10-K405

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2001

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

For the Transition Period from                              to                             

Commission File Number 333-50239

ACCURIDE CORPORATION
(Exact Name of Registrant as Specified in Its Charter)

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

Registrant's telephone number, including area code: (812) 962-5000
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 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 ý    No o

        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. ý

        As of March 1, 2002, 24,796 shares of Accuride Corporation common stock, par value $.01 per share (the "Common Stock") were outstanding. The Common Stock is privately held and, to the knowledge of registrant, no shares have been sold in the past 60 days, therefore the Company cannot make a determination regarding the market value of the Common Stock held by non-affiliates.

DOCUMENTS INCORPORATED BY REFERENCE

None

ACCURIDE CORPORATION
FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 2001

PART I
	Item 1.	Business
	Item 2.	Properties
	Item 3.	Legal Proceedings
	Item 4.	Submission of Matters to a Vote of Security Holders
PART II
	Item 5.	Market for Registrant's Common Equity and Related Stockholder Matters
	Item 6.	Selected Consolidated Financial Data
	Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations
	Item 7A.	Quantitative and Qualitative Disclosure About Market Risk
	Item 8.	Financial Statements and Supplementary Data
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
PART III
	Item 10.	Directors and Executive Officers of the Registrant
	Item 11.	Executive Compensation
	Item 12.	Security Ownership of Certain Beneficial Owners and Management
	Item 13.	Certain Relationships and Related Party Transactions
PART IV
	Item 14.	Exhibits, Financial Statement Schedules, and Reports on Form 8-K
FINANCIAL STATEMENTS
	Independent Auditors' Report
	Consolidated Balance Sheets
	Consolidated Statements of Income
	Consolidated Statements of Stockholders' Equity (Deficiency)
	Consolidated Statements of Cash Flows
	Notes to Consolidated Financial Statements
	Financial Statement Schedules
	Signatures

PART I

Item 1. Business

General

        Accuride Corporation, a Delaware corporation ("Accuride" or the "Company"), manufactures and supplies wheels and rims ("Wheels") for heavy and medium commercial vehicles. Accuride offers the broadest product line in the North American Wheel market for heavy and medium trucks, buses, vans ("Heavy/Medium Trucks") and trailers ("Trailers"). Accuride is the only North American manufacturer and supplier of both steel and forged aluminum Wheels for Heavy/Medium Trucks and Trailers ("Heavy/Medium Wheels").

        Accuride sells its Wheels primarily to Heavy/Medium Truck, Trailer and Light Truck (as defined) original equipment manufacturers ("OEMs"). Major customers include Ford Motor Company ("Ford"), Freightliner Corporation ("Freightliner"), General Motors Corporation ("General Motors"), Mack Trucks, Inc. ("Mack"), International Truck and Engine Corporation ("International"), Volvo Trucks North America ("Volvo") and Paccar, Inc. ("Paccar"). For over 10 years, Accuride's steel Wheels have been standard equipment at all North American Heavy/Medium Truck OEMs and at a number of North American Trailer OEMs. In addition, our steel Wheels are standard equipment at a majority of North America's largest trucking fleets, including J.B. Hunt Transport Services, Ryder Truck Rental, Inc., WPS, Ruan Transportation Management Systems, and Schneider Specialized Carriers, Inc. Accuride's aluminum Wheels are standard equipment at Volvo, International, and Freightliner. Approximately 25% of Accuride's sales are to Light Truck OEMs such as Ford and General Motors.

        The North American vehicle market served by Accuride can be divided into three categories: (i) Heavy/ Medium Trucks, (ii) Trailers and (iii) other vehicles such as light commercial trucks, pick-up trucks, sport utility vehicles and vans ("Light Trucks").

Corporate History

        Accuride and Accuride Canada Inc., a corporation formed under the laws of the province of Ontario, Canada and a wholly owned subsidiary of Accuride, were incorporated in November 1986 for the purpose of acquiring substantially all of the assets and assuming certain of the liabilities of Firestone Steel Products, a division of The Firestone Tire & Rubber Company. The respective acquisitions by the companies were consummated in December 1986. In 1988, the Company was purchased by Phelps Dodge Corporation ("Phelps Dodge"), the sole owner prior to the Recapitalization described below. See "The Recapitalization." As used herein, the terms "Accuride", "Company", "we", "us", and "our" include subsidiaries and predecessors unless the context indicates otherwise.

The Recapitalization

        On November 17, 1997, Accuride entered into a stock subscription agreement with Hubcap Acquisition L.L.C. ("Hubcap Acquisition") pursuant to which Hubcap Acquisition acquired control of the Company. Hubcap Acquisition is a Delaware limited liability company whose members are KKR 1996 Fund L.P. and KKR Partners II, L.P., which are affiliates of Kohlberg Kravis Roberts & Co. L.P. ("KKR"). The acquisition consisted of an equity investment in the Company (the "Equity Investment") together with approximately $363.7 million of aggregate proceeds from certain financings described below (collectively, the "Financings") which were collectively used to redeem shares of Common Stock of the Company ("Common Stock") owned by Phelps Dodge (the "Redemption") and obtain a non-competition agreement. The Equity Investment, Financings, and Redemption are collectively referred to as the "Recapitalization." Immediately after the closing of the Recapitalization, Hubcap Acquisition owned 90% of the Common Stock and Phelps Dodge owned 10% of the Common Stock.

Shortly after the Recapitalization, Accuride sold additional shares of Common Stock and granted options to purchase Common Stock to senior management of the Company representing, in the aggregate, approximately 10% of the fully diluted equity of the Company. Phelps Dodge subsequently sold its remaining interest in Accuride to RSTW Partners III, L.P.

        The Financings included (i) an aggregate of approximately $164.8 million of bank borrowings by the Company, including $135.0 million of borrowings under senior secured term loans (the "Term Loans") and $29.8 million of borrowings under a $140.0 million senior secured revolving credit facility (the "Revolver" and, together with the Term Loans, the "Credit Facility"), and (ii) $200.0 million aggregate principal amount of private notes ("Private Notes"). The Revolver is available for our working capital requirements and to facilitate future growth opportunities. The Term Loans and Revolver were amended and restated effective July 27, 2001 as discussed in the Capital Resources and Liquidity section of Item 7. The Private Notes were exchanged for public notes ("Exchange Notes") which were registered under the Securities Act of 1933, as amended (the "Securities Act"), pursuant to a registration statement on Form S-4 declared effective by the Securities and Exchange Commission (the "Commission") on July 23, 1998. The Exchange Notes evidence the same debt as the Private Notes (which they replace) and are entitled to the benefits of an indenture dated January 21, 1998 (the "Indenture"). The Private Notes and the Exchange Notes are sometimes collectively referred to herein as the "Notes."

Acquisitions

        AKW L.P.    AKW L.P., a Delaware limited partnership ("AKW") was formed in 1997 as a 50-50 joint venture between Accuride and Kaiser Aluminum and Chemical Corporation ("Kaiser") to design, manufacture, and sell heavy-duty forged aluminum Wheels. On April 1, 1999, Accuride acquired Kaiser's 50% interest in AKW.    In connection with the acquisition, AKW and Kaiser amended and restated an existing lease agreement pursuant to which AKW leases certain property from Kaiser.    Total consideration paid to Kaiser for the 50% interest was approximately $71 million.    The acquisition has been accounted for by the purchase method of accounting. The goodwill recorded in connection with the acquisition is being amortized on the straight-line method over 40 years.

        Accuride de Mexico.    On November 5, 1997, Accuride invested $4.9 million for a 51% interest in Accuride de Mexico, S.A. de C.V. ("AdM"), a venture with Industria Automotriz, S.A. de C.V. ("IaSa"), Mexico's only commercial vehicle Wheel manufacturer. On July 16, 1999, Accuride acquired IaSa's 49% interest in AdM, pursuant to the terms of a purchase agreement by and among the Company, IaSa and certain other parties. The acquisition gives Accuride 100% control of AdM. Total consideration paid was $7.4 million, consisting of a $7.3 million cash payment to IaSa for its 49% interest and $0.1 million paid to other parties for fees and expenses.

Joint Venture

        In 1991, Accuride entered into a joint venture with The Goodyear Tire and Rubber Company ("Goodyear") to assemble Wheels and tires for International to strengthen our position in the worldwide Wheel industry. Accuride and Goodyear formed AOT, Inc. ("AOT") in June 1991 in order to assemble Wheels and tires for International near International's truck assembly operation in Springfield, Ohio. Accuride and Goodyear each own 50% of AOT. In April 1998, Assembly On Time Canada Inc. (which subsequently changed its name to AOT Canada Ltd) was created as a wholly owned subsidiary of AOT to expand the AOT operations for International at a new facility in Talbotville, Ontario, Canada.

Industry Overview

        Currently, the size of the steel and aluminum commercial vehicle Wheel industry for Heavy/Medium Trucks and Trailers in North America is approximately $0.4 billion, and the size of the steel and aluminum Wheel industry for Light Trucks in North America is approximately $1.4 billion. Wheels are produced for (i) Heavy/Medium Trucks, which are over-the-road vehicles designed to carry over 10,000 pounds such as large multi-axle rigs, buses and moving trucks; (ii) Trailers, which includes trailers and chassis; and (iii) Light Trucks, which are vehicles designed to carry under 10,000 pounds such as pick-up trucks, walk-in delivery vans and sport utility vehicles. Wheels and rims produced for Heavy/Medium Trucks and Trailers are larger and heavier dual type Wheels. Wheels produced for Light Trucks are generally smaller and lighter single or dual type Wheels requiring lower load requirements.

        The commercial Wheel industry may be categorized in three ways: (i) by vehicle category-Heavy/Medium Wheels and Light Truck Wheels, (ii) by production material-steel and aluminum Wheels, and (iii) by vehicle application-dual and single Wheels.

        Heavy/Medium Wheels and Light Truck Wheels.    Heavy/Medium Wheels range in diameter from 17.5" to 24.5". Purchasers of Heavy/Medium Wheels consist primarily of Heavy/Medium Truck OEMs such as Freightliner, Paccar, International, Mack, and Volvo, and Heavy/Medium Trailer OEMs such as Great Dane Limited Partnership ("Great Dane"), Utility Trailer Manufacturing Company ("Utility") and Wabash National, Inc. ("Wabash"). The Heavy/Medium Wheel market is driven by the volume of Heavy/Medium Truck and Trailer manufacturing, which is tied to macroeconomic trends such as economic growth, fuel prices, interest rates, and insurance expense. In 2001, industry sales of Heavy/Medium Wheels in North America were approximately $0.4 billion.

        Light Truck Wheels range in diameter from 14" to 20". Purchasers of Light Truck Wheels consist primarily of Light Truck OEMs such as Ford and General Motors. The Light Truck Wheel market is driven by the volume of production of Light Trucks and performance automobiles as well as the trend toward the use of larger diameter Light Truck Wheels in smaller Light Trucks such as sport utility vehicles to improve styling and performance. In 2001, industry sales of Light Truck Wheels in North America were approximately $1.4 billion.

        Steel and Aluminum Wheels.    Steel Wheels are more resistant to damage and hold a substantial price advantage over aluminum Wheels. Aluminum Wheels are generally lighter in weight, more readily stylized and approximately 3.5 times more expensive than steel Wheels. The growth of aluminum Heavy/Medium Wheel and Light Truck Wheel sales is driven by the increasing importance of the aesthetic aspect of Wheels, particularly in the Light Truck Wheel market, and, to a lesser extent, reduced vehicle weight.

        Dual and Single Wheels.    Dual Wheels, which carry higher load ratings, are used on Heavy/Medium Trucks, Trailers and Light Trucks. Dual Wheels may be mounted in tandem (i.e., side-by-side, two wheels on each end of an axle) or individually. Single Wheels are used on Light Trucks and passenger cars. The Company is the only producer of both dual and single steel Light Truck Wheels in North America.

Products and Services

        Accuride has the broadest product line in the North American Heavy/Medium Wheel industry. We also compete in the Light Truck Wheel market for larger (with diameters of 16" and over) steel Wheels for Light Trucks. Accuride offers steel and aluminum Wheels for Heavy/Medium Trucks and Trailers, heavy-duty Wheels for the vocational vehicle industry and stylized steel Wheels for Light Trucks. Accuride distributes its products directly to OEMs and through independent distributors.

Customers

        Accuride's customers fall into four general categories: (i) Heavy/Medium Truck OEMs (which represented approximately 43% of the Company's 2001 net sales); (ii) Trailer OEMs (which represented approximately 17% of the Company's 2001 net sales); (iii) Light Truck OEMs (which represented approximately 25% of the Company's 2001 net sales); and (iv) aftermarket distributors and others (which represented approximately 15% of the Company's 2001 net sales). Accuride's major customers include Freightliner, Volvo, Mack, International and Paccar, which are Heavy/Medium Truck OEMs; Great Dane, Utility, Wabash, and Stoughton Trailers, Inc., which are Trailer OEMs; and Ford, DaimlerChrysler and General Motors, which are Light Truck OEMs. Accuride derived approximately 21.3%, 12.4%, and 12.1% of its 2001 net sales from Ford, Freightliner, and International, respectively. The loss of a significant portion of sales to any of these OEMs could have a negative impact on our business. Accuride also serves the aftermarket through a broad network of distributors.

        Accuride's design engineers work closely with its customers to support the vehicle system design. Established contacts with OEM engineers enable us to track industry trends, including new features and styles, and to ensure that new products meet changing requirements for new vehicle systems. For example, over the last few years, we have responded to and worked with customers to complete significant new development programs in the areas of full-contoured styled Light Truck steel Wheels and styled- aluminum Wheels.

        In the Heavy/Medium Wheel industry, Wheels are designated as standard equipment by the OEM, although other Wheels may be selected by fleet managers as component parts for their fleets. Generally, OEMs will have one standard Wheel manufacturer for any given vehicle model. Because Accuride is the only standard Steel Wheel manufacturer at all North American Heavy/Medium Truck OEMs, each Heavy/Medium Truck produced in North America will have Accuride Wheels unless the end-purchaser of a particular Heavy/Medium Truck (or fleet of Heavy/Medium Trucks) specifically requests a Wheel produced by another supplier. Light Truck OEMs will ordinarily designate more than one Wheel option as standard for any particular vehicle model and one Wheel supplier to supply each option. Consequently, for any particular vehicle model, more than one supplier may have its Wheels designated as standard equipment. OEMs determine which of the standard Wheels to use on any one vehicle depending on factors such as marketing, consumer preference and cost. In some cases, an OEM will allow an end-consumer to select a Wheel option from the set of Wheels designated as standard. The process of being designated as a standard supplier of a particular Wheel generally takes more than two years from the time of initial design to first delivery. A potential supplier must first develop a Wheel design based on styling and engineering specifications provided by the OEM. After a comprehensive engineering and feasibility review, the OEM designates a specific supplier for a particular Wheel. The duration of the designation is dependent upon the life cycle of the vehicle model. A supplier that designs, engineers, manufactures and conducts quality control testing is generally referred to as a "Tier I" supplier. Accuride is a Tier I supplier for both Ford and General Motors and believes that its early involvement with the engineers from our customers affords us a competitive advantage.

Manufacturing

        Continuous Productivity Improvement.    Accuride has developed and implemented a cost reduction and productivity program to continuously improve its operations and to modernize, upgrade and automate its manufacturing facilities. Since 1998, we have invested over $120 million to improve our facilities, including selected use of robotics and other automation, connection of the automated component lines to the assembly lines, and improvement in product quality through upgrading of key processes. The success of this program is reflected in improvements in operating results, cost-reduction, capacity, product quality and plant safety. The majority of our recent expenditures targeted the Tubeless Heavy/Medium Steel Wheel production processes at the Henderson, Kentucky and Ontario,

Canada, facilities, the Light Truck Steel Wheel production process at the Ontario, Canada, facility, and a major expansion of Tubeless Heavy Aluminum Wheel production capacity at the Erie, Pennsylvania, facility. We have budgeted approximately $19.3 million in 2002 for capital spending of which $11.8 million is for productivity and capacity rationalization programs. Management believes that its emphasis on low-cost manufacturing will continue to yield significant operational improvements, although no assurance of such improvements can be given.

        Manufacturing Process.    Accuride's Wheels are made using seven primary manufacturing processes: stamping, spin forming, roll forming, welding, coating/finishing, forging and machining. Our steel Wheel products are produced by spin forming or stamping of the disc, roll forming of the rim, welding, coating and finishing. Our forged aluminum Wheels are made using forging, heat treating, spinning, machining and polishing processes. The following describes the major processes we use to produce Wheels:

        Stamping.    Accuride makes discs for single Light Truck Wheels using stamping, which is the most cost-effective way to produce single steel discs because it requires the lowest cycle time per part of any available process. Stamping allows for thinner gauge steel to be used to reduce weight without sacrificing strength.

        Spin Forming.    Accuride makes discs for dual Wheels by using spin forming, which produces discs with variable wall thickness, thus reducing weight and enhancing the strength-to-weight ratio of the Wheel. Spin forming also provides a high-quality product with low raw material usage and waste.

        Roll Forming.    Accuride makes Light and Heavy/Medium steel rims using roll forming (feeding coiled steel through equipment that forms it into a cylinder, welds it, then feeds it through rim rollers to shape the rim). We have developed an extensive roll forming expertise in the 40-plus years that we have used this process and believe that we have one of the industry's highest quality yields for rim rolling.

        Welding.    Accuride uses an arc welding process to permanently join together the manufactured rims and discs for Light and Heavy/Medium steel Wheels. The arc welding process is done after the rims and discs have been assembled and provides an efficient, high strength attachment method required to sustain Wheel service loads. A resistance butt welding process is used to join the opposing ends of the formed cylinder prior to the rollforming operation during the manufacture of steel rims. This rim butt welding process is the most cost effective metal joining technology for this application and provides a high quality, air tight seam required to maintain proper tire inflation pressure.

        Coating/Finishing.    Accuride pre-treats all steel Wheels in zinc phosphate, then applies an electro-disposition coating ("E-coat"), which is an acrylic, cathodic, gray or white base coating that provides resistance to corrosion. Subsequently, some customers may choose to have us add a topcoat over the E-coat for further protection.

        Forging.    Accuride makes Heavy/Medium aluminum Wheels by using forging, in which an aluminum billet is compressed into a basic Wheel shape using high amounts of pressure and energy. Forgings are formed into their final shape using spinning (in the rim area) and by machining the entire contour to create final mounting dimensions and appearance. Forgings can offer decisive performance advantages in heavy applications.

        Machining.    Accuride uses machining processes at its Cuyahoga Falls, Ohio, and Erie, Pennsylvania, facilities to convert processed forgings into finished machined Wheels. Capital investments during 2000 and 2001 have expanded Accuride's machining capability. We believe that the control of the final machined finish is essential to meet customer appearance standards.

Supplier Relationships

        Steel Suppliers.    Accuride has secured favorable pricing from a number of different suppliers by negotiating high-volume contracts with terms ranging from 1 to 3 years. While we believe that our supply contracts can be renewed on acceptable terms, there can be no assurance that such agreements can be renewed on such terms or at all. However, we do not believe that we are overly dependent on long-term supply contracts for our steel requirements as we have alternative sources available if need requires.

        Aluminum Suppliers.    Accuride obtains aluminum through third-party suppliers. We believe that aluminum is readily available from a variety of sources. We use commodity price swaps to partially protect against changes in the market price of aluminum. See "Item 7A—Quantitative and Qualitative Disclosure about Market Risk" for our discussion on commodity price risk.

Sales and Marketing

        Accuride has built its brand franchise with a targeted sales and marketing effort aimed at Heavy/Medium Truck OEMs, Trailer OEMs, Light Truck OEMs and independent distributors. We actively market to major end-users, including trucking fleets and dealers. Accuride positions its sales managers near major customers such as Ford and General Motors in Detroit, Michigan and Freightliner in Portland, Oregon. Additional field sales personnel are geographically located throughout North America to service other OEMs, independent distributors, trucking fleets and dealers. New emphasis is being placed on targeting end-users as we commercialize premium products and expand our aluminum product line. The majority of our core customers source their requirements either on annual contracts or standard sourcing contracts.

        Accuride has appointed independent distributors in every major market area in the United States, Canada, and Mexico. The majority of these distributors are members of the National Wheel and Rim Association and serve aftermarket needs and small OEMs that we do not service directly. As a service to the aftermarket and small OEMs, we also provide order consolidation services from our warehouse in Taylor, Michigan.

Competition

        Accuride competes on the basis of price, delivery, quality, product line breadth and service. Our competitive advantages include long standing customer relationships, broad product lines in steel and aluminum, high quality products and low manufacturing costs. Due to the breadth of our product line, we compete with different companies in different markets. Our principal competitor in the dual steel Heavy/Medium Wheel and single steel Light Truck Wheel markets is Hayes Lemmerz International, Inc. ("Hayes"). Hayes has established a significant global presence and we believe Hayes is the market leader in the single Light Truck Wheel market and in the passenger car Wheel industry, which are more diversified markets than the other markets in which we compete. In the dual steel Light Truck Wheel industry, Accuride's principal competitor is ArvinMeritor Automotive, Inc. ("Meritor"). All of the dual Wheels sold by Meritor in North America are produced in either Brazil or Mexico. In the dual aluminum Heavy/Medium Wheel market, Accuride's principal competitor is Alcoa, Inc. ("Alcoa"), which we believe has the leading share in that market. Alcoa does not produce steel Wheels.

Employees

        As of January 31, 2002, Accuride had 1,887 employees. The following facilities are currently unionized: Henderson, Kentucky, plant; London, Ontario, Canada, plant; Erie, Pennsylvania, plant; and Monterrey, Mexico, plant.

        Hourly employees at the Henderson, Kentucky, facility are represented by the International Union, Automobile, Aerospace, and Agriculture Implement Workers of America ("UAW") Local #2036. The Company's contract with the UAW expired in February 1998. Accuride was not able to negotiate a mutually acceptable agreement with the UAW, and a strike occurred at the Henderson, Kentucky, facility on February 20, 1998. Effective as of March 31, 1998, we began an indefinite lockout in order to provide security for plant personnel and equipment. The UAW has rejected all of our offers, and the parties continue to be unable to reach an agreement. We are continuing to operate with salaried employees and outside contractors. Currently, there is no, and we do not believe that there will be any, supply disruption to our customer base; however, there can be no assurance to that effect. A supply disruption to our customer base could have a material adverse effect on the Company. Management does not believe that the strike had any material affect on pre-tax earnings in 2001.

        Bargaining unit employees in the Ontario, Canada, facility are represented by National Automobile, Aerospace, Transportation, and General Workers Union of Canada ("CAW") Local #27. A 3-year collective bargaining agreement was ratified on December 8, 1999. The contract runs through March 13, 2003.

        Hourly employees at the Erie, Pennsylvania, facility are represented by the UAW Local # 1186. The existing contract was implemented in August 1998 and expires in August 2003.

        The Monterrey, Mexico, hourly employees are represented by "El Sindicato Industrial de Trabajadores de Nuevo Leon". The current contract has been in place since November 1997 and is subject to renegotiation on an annual basis.

Research and Development

        The Research and Development ("R&D") department is composed of 29 employees, 18 of whom are degreed engineers (nine with advanced degrees). The objectives of the R&D department are to design and develop new products, provide technical support and service to customers and to investigate and develop new process technology. Over the last few years, Accuride has completed significant new product and process development programs in the areas of full-faced styled steel Wheels, high strength, low alloy Wheels ("HSLA"), new forged aluminum Wheel designs, cast aluminum Wheels for Heavy/Medium Truck applications in North America, and cladded wheels for Light Truck applications. Company-sponsored R&D costs for fiscal years 2001, 2000, and 1999 were approximately $5.3 million, $6.3 million and $5.2 million, respectively. These costs were expensed and included in general and administration expenses during the period incurred.

International Sales

        Sales to customers outside of the United States are considered international sales by the Company. International sales in 2001 were $77.9 million, or 21.4% of our 2001 sales volume. For additional information, see footnote 15 to the "Notes to Consolidated Financial Statements" included herein.

Patents and Trademarks

        Accuride maintains an intellectual property estate, including patents and extensive proprietary knowledge of products and systems. We currently hold 10 patents related to Wheel technology and a further 9 patents are pending. Accuride has applied for federal and international trademark protection for numerous marks. Accuride does not rely on, and is not dependent on, patent ownership for its competitive position. Were any or all patents held to be invalid, management believes the Company would not suffer significant damage. However, we do actively pursue patents on our new technology.

Backlog

        Accuride's production is based on firm customer orders and estimated future demand. Since firm orders generally do not extend beyond 15-45 days and we generally meet all requirements, backlog is not considered significant.

Cyclical and Seasonal Industry

        The Heavy/Medium Wheel and Light Wheel industries are highly cyclical and, in large part, depend on the overall strength of the demand for Heavy/Medium Trucks, Trailers, and Light Trucks. These industries have historically experienced significant fluctuations in demand based on factors such as general economic conditions, interest rates, government regulations, and consumer confidence. Since mid-2000, the industry has been in a severe downturn. This significant decrease in overall consumer demand for Heavy/Medium Trucks, Trailers, and/or Light Trucks continues to have a negative impact on Accuride's business. In addition, Accuride's operations are typically seasonal as a result of regular customer maintenance and model changeover shutdowns, which typically occur in the third and fourth quarter of each calendar year. This seasonality may result in decreased net sales and profitability during the third and fourth fiscal quarters of each calendar year.

Environmental Matters

        Accuride's operations are subject to various federal, state and local requirements, including environmental laws. Under certain environmental laws, a current or previous owner or operator of property may be liable for removal or remediation costs of certain hazardous substances or petroleum products on, under or in such property, without regard to whether the owner or operator knew of, or caused, the presence of the contaminants, and regardless of whether the practices that resulted in the contamination were legal at the time they occurred. The presence of, or failure to remediate such substances properly, may adversely affect the ability to sell or rent such property or to borrow using such property as collateral. Persons who generate, arrange for the disposal or treatment of, or dispose of hazardous substances may be liable for the costs of investigation, remediation or removal of such hazardous substances at or from the disposal storage or treatment facility, regardless of whether such facility is owned or operated by such person. Additionally, the owner of a site may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from a site. Compliance with environmental laws, stricter interpretations of or amendments to any such laws, or more vigorous enforcement policies by regulatory agencies with respect to any of them may require material expenditures by the Company. There can be no assurance that future regulations will not require Accuride to modify its facilities to meet revised requirements of environmental laws.

        The nature of Accuride's current and former operations and the history of industrial uses at our facilities expose us to the risk of liabilities or claims with respect to environmental and worker health and safety matters that could have a material adverse effect on our business. Phelps Dodge has indemnified Accuride with respect to environmental liabilities at the Henderson, Kentucky, facility and the Ontario, Canada, facility. Kaiser has indemnified Accuride with respect to environmental liabilities at the Erie, Pennsylvania, facilities except (i) Accuride will be solely responsible for claims, losses and liabilities that are caused by or arise from any action by Accuride in connection with the conduct of its business, (ii) Kaiser and Accuride will be responsible for their appropriate share of such claims, losses and liabilities associated with contamination due to the failure of Accuride to maintain the pits at the Erie, Pennsylvania, facility which contain hydraulic presses, (iii) Kaiser and Accuride will be responsible for their appropriate share of such claims, losses and liabilities that arise from both the actions of Kaiser and Accuride, the conduct of the business by either of them or (iv) to the extent that any fines or penalties assessed or threatened against Accuride during the period in which Kaiser is implementing an environmental compliance plan at the Erie, Pennsylvania, facility exceed $1,000,000.

Item 2. Properties

        Accuride operates nine facilities in North America. Accuride owns manufacturing facilities in Henderson, Kentucky; Columbia, Tennessee; Monterrey, Mexico; and London, Ontario, Canada. Accuride also leases facilities in Erie, Pennsylvania and Cuyahoga Falls, Ohio, a distribution warehouse in Taylor, Michigan, a sales office in the greater Detroit area, and an office building in Evansville, Indiana. Accuride operates facilities in Springfield, Ohio, and Talbotville, Ontario, Canada, through its joint venture with Goodyear. Accuride believes its plants are adequate and suitable for the manufacturing of products for the markets in which it sells. In 2001, the London, Ontario facility operated near capacity while the other plants operated well below capacity due to reduced OEM production schedules for Heavy/Medium Trucks.

        Accuride's corporate, manufacturing, sales, warehouse, and research facilities are as follows:

Location	Square Feet	Use	Owned/ Leased
London, Ontario, Canada (a)	462,993	Heavy/Medium Steel Wheels; steel Light Truck Wheels	Owned
Henderson, Kentucky	364,365	R&D; Heavy/Medium Steel Wheels	Owned
Taylor, Michigan (b)	75,000	Warehouse	Leased
Springfield, Ohio (c)	136,000	Wheel and tire assemblies for International	Owned
Talbotville, Ontario, Canada (d)	159,140	Wheel and tire assemblies for International	Owned
Erie, Pennsylvania (e)	126,000	Aluminum Wheels forging and machining	Leased
Cuyahoga Falls, Ohio (f)	131,700	Aluminum Wheels machining and polishing	Leased
Columbia, Tennessee (g)	340,000	Steel Light Truck Wheels	Owned
Monterrey, Mexico	262,000	Light/Medium/Heavy Steel Wheels	Owned
Evansville, Indiana (h)	37,229	Corporate headquarters of the Company	Leased
Northville, Michigan (i)	4,334	Sales Office	Leased

a)

Accuride is currently in the process of adding 63,000 square feet for light wheel production.

b)

The warehouse is leased from The Package Company under a ten year lease at the rate of $22,882 per month. The lease expires in 2009.

c)

Owned by AOT, the joint venture with Goodyear.

d)

Owned by AOT Canada Ltd. (a subsidiary of AOT) as part of the joint venture with Goodyear.

e)

The building is leased by AKW under a ten-year lease from Kaiser at the rate of $1.00 per year. The initial term of the lease expires in 2007.

f)

The building is leased by AKW from The Bell Company. The building lease was renewed in June 2001 with monthly lease payments of $32,245 through June 30, 2002 and $34,208 thereafter. The lease expires in June 2002, with an option to renew.

g)

Accuride previously announced the closure of this facility which is anticipated to be completed in the second quarter of 2002. We plan to sell the facility, thereafter.

h)

The building is leased from Woodward, LLC under a ten-year lease at the rate of $41,106 per month for the first 60 months of the lease and $45,232 per month thereafter. The Company moved into this office facility in November 1999.

i)

The building is leased from Northwood Corporate Park, LP under a five-year lease that began December 1, 1997 at a rate of $6,230 per month.

        The address of the Company's principal executive office is 7140 Office Circle, Evansville, Indiana 47715, and the Company's phone number is (812) 962-5000.

Item 3. Legal Proceedings

        We are subject to claims against us and we make claims against others in the ordinary course of our business. We do not believe that the resolution of our pending claims will materially adversely affect our business.

Item 4. Submissions of Matters to a Vote of Security Holders

        None.

Part II

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters

        Accuride's Common Stock is privately held and not listed for trading on any public market. As of March 1, 2002, there were approximately 46 record holders of the Company's Common Stock.

DIVIDEND POLICY

        Accuride has not declared or paid cash dividends on its Common Stock. Accuride currently intends to retain any future earnings to pay down debt and finance the growth and development of its business and therefore does not anticipate paying any cash dividends in the foreseeable future. Any future determination to pay cash dividends will be made by the Board of Directors in light of the Company's earnings, financial position, capital requirements and such other factors as the Board of Directors deems relevant. The payment of dividends is restricted under the terms of the Credit Facility and the Indenture. See "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources."

RECENT SALES OF UNREGISTERED SECURITIES

        Accuride did not issue any shares of the Company's Common Stock during 2001. In September 2001, Accuride offered eligible employees the opportunity to exchange performance options with an exercise price of $5,000 per share or more that were scheduled to vest in 2001 and 2002 for new options which Accuride intends to grant in 2002 under the 1998 plan. The new options will vest over a period of four years and will have an exercise price equal to the fair market value on the date of grant. On October 4, 2001, 309.4 options were tendered by the employees and were accepted for exchange and cancelled by Accuride.

Item 6. Selected Consolidated Financial Data

        The following financial data is an integral part of, and should be read in conjunction with the "Consolidated Financial Statements" and notes thereto. Information concerning significant trends in the financial condition and results of operations is contained in "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations."

Selected Historical Operations Data

		Fiscal Year Ended December 31,
		2001			2000			1999			1998			1997
		(In thousands)
Operating Data:
Net sales(a)		$	332,071		$	475,804		$	505,854		$	383,583		$	332,966
Gross profit(a)(b)			36,334			82,572			115,078			82,554			65,994
Operating expenses(c)			33,538			32,849			33,493			34,034			21,316
Income from operations(b)			2,796			49,723			81,585			48,520			44,678
Interest income (expense), net			(40,199	)		(38,742	)		(38,988	)		(32,311	)		385
Equity in earnings of affiliates(d)			250			455			2,316			3,929			4,384
Other income (expense), net(e)			(9,837	)		(6,157	)		(1,081	)		(2,904	)		719
Net income (loss)			(33,154	)		2,513			25,331			7,951			27,837
Other Data:
Adjusted EBITDA(f)		$	40,978		$	89,345		$	111,682		$	88,160		$	76,888
Adjusted EBITDA Margin(g)			12.3	%		18.7	%		21.6	%		21.1	%		21.8	%
Net cash provided by (used in):
	Operating activities		1,359			66,343			86,835			22,662			38,219
	Investing activities		(18,405	)		(51,688	)		(124,324	)		(44,669	)		(47,065	)
	Financing activities		26,238			(8,632	)		66,511			18,060			9,953
Cash interest expense(h)			39,365			38,275			37,841			31,450			145
Depreciation and amortization			35,611			32,279			29,784			24,926			20,726
Capital expenditures			17,705			50,420			44,507			46,579			24,032
Balance Sheet Data (end of period):
Cash and cash equivalents		$	47,708		$	38,516		$	32,493		$	3,471		$	7,418
Working capital(i)			(5,136	)		12,977			40,492			49,628			27,416
Total assets			498,223			515,271			525,772			404,925			347,447
Total debt			476,550			448,886			460,561			393,200			16,040
Stockholders' equity (deficiency)			(62,354	)		(29,200	)		(32,131	)		(58,096	)		256,055

(a)

Results of operations for the year ended December 31, 1997 (subsequent to May 1997) do not reflect net sales and gross profit for aluminum Wheels due to the formation of the AKW joint venture with Kaiser. Net sales and gross profit for aluminum Wheels were $19.1 million and $1.1 million, respectively, for the period beginning on January 1, 1997 and ending on April 30, 1997. Results of operations for the year ended December 31, 1999 are based on the Company's 50% ownership of AKW through March 31, 1999 and 100% ownership of AKW since April 1, 1999. Net sales and gross profit for aluminum wheels for the 9-month period from April 1, 1999 through December 31, 1999 were $76.1 million and $22.1 million, respectively.

(b)

Gross profit and income from operations for the year ended December 31, 1997 reflect $7.1 million of costs incurred in connection with the strike in early 1997 at the Company's facility in Ontario, Canada. Gross profit and income from operations for 1998 reflect $3.9 million of costs incurred in connection with the strike in 1998 at the Company's facility in Henderson, Kentucky, and $1.1 million of restructuring charges related to Accuride Canada, Inc. Gross profit and income from operations for 1999 reflect a reduction to cost of $3.0 million related to the favorable AKW recall adjustment. Gross profit for 2000 reflects $5.0 million of costs related to integration and restructuring charges at our Monterrey, Mexico, facility, and $0.2 million of cost related to restructuring charges related to our other facilities. Gross profit for 2001 reflects $2.7 million of

charges related to the closure of the Columbia, Tennessee, facility, $1.6 million of restructuring charges related to our other facilities, and a $2.6 million charge for impaired assets at the Monterrey, Mexico, facility.

(c)

Operating expenses include selling, general and administrative plus (i) $3.3 million of start-up costs related to the Columbia, Tennessee, facility incurred during 1998, (ii) $1.9 million of management retention bonuses reimbursed by Phelps Dodge in 1998, and (iii) $2.2 million of Recapitalization professional fees recorded in 1998.

(d)

Equity in earnings of affiliates includes Accuride's income from (i) AKW, from its inception in May 1997 through March 31, 1999, and (ii) AOT, which provides International with Wheel/tire assembly services.

(e)

Other income (expense), net consists primarily of realized and unrealized gains and losses related to the change in market value of our currency, commodity, and interest rate derivative instruments.

(f)

Adjusted EBITDA for 2001 represents income from operations plus depreciation and amortization, net of $2.2 million in amortization of deferred financing costs, plus equity in earnings of affiliates, plus (i) $2.7 million of charges related to the closure of the Columbia, Tennessee, facility, (ii) $1.6 million of restructuring charges related to our other facilities, and (iii) $0.2 million of charges related to the Amended and Restated Credit Agreement entered into on July 27, 2001, see "Item 7-Management's Discussion and Analysis of Financial Condition and Results of Operations."    Adjusted EBITDA for 2000 represents income from operations plus depreciation and amortization, net of $2.3 million in amortization of deferred financing costs, plus equity in earnings of affiliates, plus (i) $3.2 million of costs related to aborted merger and acquisition activities, (ii) $5.4 million restructuring and integration costs related to operations in Monterrey, Mexico, and (iii) $0.6 million for restructuring costs in the United States. Adjusted EBITDA for 1999 represents income from operations plus depreciation and amortization, net of $1.9 million in amortization of deferred financing costs plus equity in earnings of affiliates, plus (i) $1.4 million of fees associated with merger and acquisition activities less (ii) $1.5 million associated with the AKW wheel recall adjustment. This $1.5 million represents 50% of the $3.0 million reduction in the AKW product recall reserve. Adjusted EBITDA for 1998 represents income from operations plus depreciation and amortization, net of $1.7 million in amortization of deferred financing costs plus equity in earnings of affiliates, plus (i) $1.1 million of estimated restructuring costs at the London, Ontario facility, (ii) $3.4 million representing the impact of the AKW wheel recall campaign implemented in 1998, (iii) $1.9 million of management retention bonuses reimbursed by Phelps Dodge in 1998, (iv) $2.2 million of Recapitalization professional fees and (v) $3.9 million of costs incurred in connection with the strike in 1998 at the Henderson, Kentucky, facility. In determining Adjusted EBITDA for 1997, income from operations has been increased by depreciation and amortization, equity in earnings of affiliates and $7.1 million representing the estimated impact of the strike at the London, Ontario, facility that occurred during the first quarter of 1997. Adjusted EBITDA is not intended to represent cash flows from operations as defined by generally accepted accounting principles ("GAAP") and should not be considered as an alternative to net income as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. Adjusted EBITDA is included in this Annual Report as it is a basis upon which the Company assesses its financial performance and certain covenants in the Company's borrowing arrangements are tied to similar measures.

(g)

Represents Adjusted EBITDA before equity in earnings of affiliates and before the $3.4 million impact of the AKW wheel recall campaign implemented in 1998, as a percentage of net sales.

(h)

Cash interest expense represents interest expense exclusive of $2.2 million, $2.3 million, $1.9 million and $1.7 million amortization of deferred financing costs for the years ended December 31, 2001, December 31 2000, December 31, 1999, and December 31, 1998, respectively.

(i)

Working capital represents current assets less cash and current liabilities.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

        The following discussion should be read in conjunction with the "Selected Consolidated Financial Data" and the Company's Consolidated Financial Statements and the notes thereto, all included elsewhere herein. The information set forth in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" includes forward-looking statements that involve risks and uncertainties. Many factors could cause actual results to differ materially from those contained in the forward-looking statements below. See "Factors That May Affect Future Results."

General

        Net Sales.    Accuride derives a substantial portion of its net sales from the sale of steel and forged aluminum Wheels to North American Heavy/Medium Truck, Trailer OEMs, and sales of steel wheels to the Light Truck OEMs. In addition, Accuride supplies the aftermarket with replacement products. Revenues are recognized upon shipment to customers from the Company's production facilities and warehouses.

        In May 1997, Accuride invested $20.8 million for a 50% interest in AKW, a joint venture with Kaiser which acquired Kaiser's Wheel operations in Erie, Pennsylvania, and Cuyahoga Falls, Ohio. On April 1, 1999, Accuride acquired Kaiser's 50% interest in AKW for total consideration of approximately $71 million. Accuride's participation in AKW's earnings was recorded on an equity basis from the establishment of the joint venture through March 31, 1999. Subsequent to April 1, 1999, revenues of AKW were consolidated on a 100% basis for accounting purposes.

        In November, 1997, Accuride invested $4.9 million to establish AdM, a 51%-owned venture with IaSa, Mexico's only commercial vehicle Wheel manufacturer. On July 16, 1999, Accuride acquired IaSa's 49% interest in AdM, pursuant to the terms of a purchase agreement by and among the Company, IaSa and certain other parties. The acquisition gave Accuride 100% control of AdM. Total consideration paid was $7.4 million, consisting of a $7.3 million cash payment to IaSa for IaSa's 49% interest, and $0.1 million paid to other parties for fees and expenses.

        Sales to customers outside of the United States are considered international sales by the Company. International sales in 2001 were $77.9 million, or 21.4% of the Company's 2001 sales volume. For additional information, see footnote 15 to the "Notes to Consolidated Financial Statements" included herein.

        Gross Profit.    Accuride continuously strives to improve productivity, increase quality and lower costs. Management has budgeted approximately $19.3 million in capital spending in 2002 of which $11.8 million is for productivity and capacity rationalization programs and believes that Accuride's emphasis on low-cost manufacturing will continue to yield significant operational improvements. Productivity and capacity rationalization initiatives in 2002 include $9.8 million to focus on optimization and consolidation of light steel wheel manufacturing operations and $2.0 million of various other productivity initiatives.

        Accuride believes that the experience of its labor force is a significant element in maintaining low-cost production. However, we have experienced labor problems at our Henderson, Kentucky, facility during the past few years Our contract with the UAW covering the employees at the Henderson, Kentucky, facility expired in February 1998. We were not able to negotiate a mutually acceptable agreement with the UAW, and a strike occurred at the Henderson, Kentucky, facility on February 20, 1998. Effective March 31, 1998, Accuride began an indefinite lockout in order to provide security for plant personnel and equipment. The UAW has rejected all of our offers and the parties continue to be unable to reach an agreement. Accuride is continuing to operate with its salaried employees and

outside contractors. Currently there is, and we believe that there will be, no supply disruption to our customer base; however, there can be no assurance to that effect. A supply disruption to our customer base could have a material adverse effect on our business. Accuride estimates that the strike at the Henderson, Kentucky, facility negatively affected 1998 gross profit by $3.9 million; however, due to improved performance by the salaried employees and outside contractors at the Henderson, Kentucky, facility in 1999, 2000 and 2001, the strike had no adverse impact on 1999, 2000 or 2001 pre-tax earnings.

        On May 1, 2001 Accuride announced plans to optimize its operations by restructuring the Company's Light Wheel operations and closing its Columbia, Tennessee, facility. Accuride will consolidate the production of light wheels currently produced in Columbia into its London, Ontario, facility. The closure of Columbia and the consolidation of Accuride's Light Wheel business will eliminate significant fixed overhead costs and will allow the Company to be more price competitive in the steel Light Wheel market. We reserved $2.7 million in 2001 to cover the anticipated costs related to this restructuring.

        Operating Expenses.    Operating expenses are comprised primarily of selling, general and administrative ("SG&A") fees, merger and acquisition activities, and various start up costs. SG&A is comprised of corporate overhead, such as marketing and sales, research and development, finance, human resources, and administrative as well as related professional consulting fees.

        Equity in Earnings of Affiliates.    Equity in earnings of affiliates includes Accuride's income from (i) AKW, from its inception in May 1997 through March 31, 1999, and (ii) AOT, which provides International with Wheel/tire assembly services. Income from AKW and AOT was reported on the equity method, for the applicable periods, and represents Accuride's share of such joint ventures' net income. AKW total sales for the three-month period ended March 31, 1999 were $23.9 million. AOT total sales were $6.7 million, $8.1 million, and $8.8 million for the fiscal years 2001,2000, and 1999, respectively.

        Adjusted EBITDA.    Adjusted EBITDA for 2001 represents income from operations plus depreciation and amortization, net of $2.2 million in amortization of deferred financing costs, plus equity in earnings of affiliates, plus (i) $2.7 million of charges related to the closure of the Columbia, Tennessee, facility, (ii) $1.6 million of restructuring charges related to our other facilities, and (iii) $0.2 million of charges related to the Amended and Restated Credit Agreement entered into on July 27, 2001. Adjusted EBITDA for 2000 represents income from operations plus depreciation and amortization, net of $2.3 million in amortization of deferred financing costs, plus equity in earnings of affiliates, plus (i) $3.2 million of costs related to aborted merger and acquisition activities, (ii) $5.4 million for restructuring and integration costs related to operations in Monterrey, Mexico, and (iii) $0.6 million for restructuring costs in the United States. Adjusted EBITDA for 1999 represents income from operations plus depreciation and amortization, net of $1.9 million in amortization of deferred financing costs, plus equity in earnings of affiliates, plus (i) $1.4 million of costs associated with merger and acquisition activities, less (ii) $1.5 million of costs associated with the AKW wheel recall campaign which were recovered in 1999. Adjusted EBITDA is not intended to represent cash flows from operations as defined by GAAP and should not be considered as an alternative to net income as an indicator of the Company's operating performance or to cash flows as a measure of liquidity.

Results of Operations

Comparison of Fiscal Years 2001 and 2000

        The following table sets forth certain income statement information of the Company for the fiscal years ended December 31, 2001 and December 31, 2000:

	Fiscal 2001					Fiscal 2000
	(Dollars in thousands)
Net sales	$	332,071		100.0	%	$	475,804		100.0	%
Gross profit		36,334		10.9	%		82,572		17.4	%
Operating expenses		33,538		10.1	%		32,849		6.9	%
Income from operations		2,796		0.8	%		49,723		10.5	%
Equity in earnings of affiliates		250		0.1	%		455		0.1	%
Other income (expense)		(50,036	)	(15.1	)%		(44,899	)	(9.4	)%
Net income (loss)		(33,154	)	(10.0	)%		2,513		0.5	%
Other Data:
Adjusted EBITDA		40,978		12.3	%(a)		89,345		18.7	%(a)

(a)

Represents Adjusted EBITDA less adjusted equity in earnings of affiliates as a percent of sales.

        Net Sales.    Net sales decreased by $143.7 million, or 30.2%, in 2001 to $332.1 million, compared to $475.8 million for 2000. The decrease in net sales is primarily attributable to the significant cyclical downturn of the entire Heavy/Medium commercial vehicle market. The cyclicality of this market is affected by a number of economic factors including inventory levels, interest rates, industrial production, fuel prices, and general economic demand for consumer goods. During 2001, the severe industry downturn caused most of our OEM customers to significantly cutback production levels. This reduction, coupled with continued softness in the aftermarket, significantly affected Accuride's sales volumes. We anticipate the demand for Heavy/Medium Trucks and Trailers to continue to be depressed during the first half of 2002 with gradual improvement beginning in the second half of the year.

        Gross Profit.    Gross profit decreased by $46.3 million, or 56.1%, to $36.3 million for 2001 from $82.6 million for 2000. The principal cause for the decrease in gross profit was the decrease in sales volume. In addition to the sales volume related margin loss, gross profit decreased because of (1) a $2.7 million reserve related to the closure of our Columbia, Tennessee, facility, (2) $1.6 million of restructuring charges, (3) and a $2.7 million write-down of impaired assets at our Monterrey, Mexico, facility. These decreases were partially offset by favorable foreign exchange rates, productivity improvements, and effectively controlling costs.

        Operating Expenses.    Operating expenses remained relatively constant increasing by $0.7 million, or 2.1% to $33.5 million for 2001 from $32.8 million for 2000.

        Equity in Earnings of Affiliates.    Equity in earnings of affiliates decreased by approximately $0.2 million to $0.3 million for 2001 from $0.5 million for 2000. The decrease is related to the effects of the downturn in the industry.

        Other Income (Expense).    Interest expense increased to $41.6 million for 2001 compared to $40.6 million for 2000 due to additional borrowings on the Revolver. Other expenses increased by $3.6 million to $9.8 million. The $3.6 million increase is primarily due to an unrealized loss of $3.3 million on the interest rate derivative instruments, $1.5 million of realized and unrealized losses on our commodity price derivative instruments, $2.0 of unfavorable translation adjustments, offset by a $3.2 million fluctuations in foreign currency exchange rates favorably impacting our foreign currency derivative instruments.

        Adjusted EBITDA.    Adjusted EBITDA decreased by $48.3 million, or 54.1%, to $41.0 million for 2001 from $89.3 million for 2000 due to lower gross profit as described above. In determining Adjusted EBITDA for 2001, income from operations has been increased by depreciation and amortization (except for amortization of deferred financing costs), equity earnings of affiliates, $2.7 million of charges related to the closure of the Columbia, Tennessee, facility, $1.6 million of restructuring charges related to our other facilities, and $0.2 million of charges related to the Amended and Restated Credit Agreement entered into on July 27, 2001. In determining Adjusted EBITDA for 2000, income from operations has been increased by depreciation and amortization (except for amortization of deferred financing costs), equity in earnings of affiliates, $3.2 million of costs related to aborted merger and acquisition activities, $5.4 million for restructuring and integration costs related to operations in Monterrey, Mexico, and $0.6 million for restructuring costs in the United States.

        Net Income (Loss).    Accuride had a net loss of $33.2 million for the year ended December 31, 2001 compared to net income of $2.5 million for the year ended December 31, 2000 due to lower pretax earnings as described above.

Comparison of Fiscal Years 2000 and 1999

        The following table sets forth certain income statement information of the Company for the fiscal years ended December 31, 2000 and December 31, 1999:

	Fiscal 2000					Fiscal 1999
	(Dollars in thousands)
Net sales	$	475,804		100.0	%	$	505,854		100.0	%
Gross profit		82,572		17.4	%		115,078		22.7	%
Operating expenses		32,849		6.9	%		33,493		6.6	%
Income from operations		49,723		10.5	%		81,585		16.1	%
Equity in earnings of affiliates		455		0.1	%		2,316		0.5	%
Other income (expense)		(44,899	)	(9.4	)%		(40,069	)	(7.9	)%
Net income		2,513		0.5	%		25,331		5.0	%
Other Data:
Adjusted EBITDA		89,345		18.7	%(a)		111,682		21.6	%(a)

(a)

Represents Adjusted EBITDA less adjusted equity in earnings of affiliates as a percent of sales.

        Net Sales.    Net sales decreased by $30.1 million, or 5.9%, in 2000 to $475.8 million, compared to $505.9 million for 1999. The decrease in net sales is primarily attributable to the significant cyclical downturn of the entire Heavy/Medium commercial vehicle market. The cyclicality of this market is affected by a number of economic factors including inventory levels, interest rates, industrial production, fuel prices, driver shortages and general economic demand for consumer goods. During the latter half of 2000, the severe industry downturn caused most of our OEM customers to significantly cutback production levels. This reduction, coupled with continued softness in the aftermarket, significantly affected Accuride's sales volumes. On a pro-forma basis reflecting the AKW acquisition effective April 1, 1999, sales for the twelve month period ended December 31, 2000 decreased by $54.0 million or 10.2% to $475.8 million from $529.8 million, as compared to the prior twelve-month period in 1999.

        Gross Profit.    Gross profit decreased by $32.5 million, or 28.2%, to $82.6 million for 2000 from $115.1 million for 1999. The principal cause for the decrease in gross profit was the decrease in sales volume. In addition to the sales volume related margin loss, gross profit decreased because of (1) loss of overhead absorption due to planned inventory reductions, (2) fluctuations in the Canadian/U.S.

exchange rate which adversely affected some of our negotiated raw material supply contracts, and (3) operating inefficiencies and increased depreciation expense at the Monterrey, Mexico, facility.

        Operating Expenses.    Operating expenses decreased by $0.7 million, or 2.1% to $32.8 million for 2000 from $33.5 million for 1999. This decrease is primarily the result of cost containment efforts at the corporate level.

        Equity in Earnings of Affiliates.    Equity in earnings of affiliates decreased by approximately $1.8 million to $0.5 million for 2000 from $2.3 million for 1999. The decrease is the direct result of the AKW acquisition on April 1, 1999 and the subsequent change in accounting from the equity method to reporting on a consolidated basis.

        Other Income (Expense).    Interest expense increased to $40.6 million for 2000 compared to $39.8 million for 1999 due to the increased debt incurred related to the acquisition of AKW on April 1, 1999 and higher interest rates. The increase in interest expense was partially offset by higher interest income. Other expenses increased by $5.1 million to $6.2 million. The $5.1 million increase is primarily due to fluctuations in foreign currency rates that had a negative impact on hedging instruments resulting in realized and unrealized losses.

        Adjusted EBITDA.    Adjusted EBITDA decreased by $22.4 million, or 20.1%, to $89.3 million for 2000 from $111.7 million for 1999 due to lower gross profit as described above. In determining Adjusted EBITDA for 2000, income from operations has been increased by depreciation and amortization (except for amortization of deferred financing costs), equity in earnings of affiliates, $3.2 million of costs related to aborted merger and acquisition activities, $5.4 million for restructuring and integration costs related to operations in Monterrey, Mexico, and $0.6 million for restructuring costs in the United States. In determining Adjusted EBITDA for 1999, income from operations has been increased by depreciation and amortization (except for amortization of deferred financing costs), equity in earnings of affiliates, $1.4 million of costs related to aborted merger and acquisition activities, and decreased by $1.5 million of costs associated with the AKW wheel recall campaign which were recovered in 1999. In 1998, AKW had estimated that it would cost approximately $6.8 million to recall and replace approximately 47,800 aluminum truck wheels, however, the actual cost to AKW was only $3.9 million. The $1.5 million represents Accuride's 50% interest which was brought back into income in 1999.

        Net Income.    Net income decreased by $22.8 million, or 90.1%, to $2.5 million for 2000 from $25.3 million for 1999 due to lower pretax earnings, as described above, and a resulting higher effective tax rate. The higher effective tax rate is attributable to permanent book to tax differences such as nondeductible goodwill amortization and taxable inflationary gains in Mexico in relation to lower pretax income. Of the $2.5 million of net income in 2000, $1.5 million relates to an extraordinary gain, net of bond issue expense and tax, resulting from the repurchase of $10.1 million principal amount of our Senior Subordinated Notes for $7.3 million.

Effects of Inflation.

        The effects of inflation were not considered material during fiscal years 2001, 2000 or 1999.

Capital Resources and Liquidity

        Accuride's primary sources of liquidity are cash flow from operations and borrowing under the Revolver. Primary uses of cash are funding working capital, capital expenditures and debt service.

        As of December 31, 2001, Accuride had cash and short-term investments of $47.7 million compared to $38.5 million as of December 31, 2000. Cash provided from operating activities of $1.4 million and financing activities of $26.2 million were used to fund the investing activities of

$18.4 million and an increase in cash and cash equivalents of $9.2 million. The $26.2 million of financing activities include $40.0 million borrowed against the Revolver and $0.2 million proceeds from stock subscriptions receivable, offset by the prepayment of $4.9 million in term loans, the payment of the AdM working capital facility of $7.5 million, deferred financing fees of $1.3 million relating to the July 27, 2001 Amended and Restated Credit Agreement, and $0.2 million redemption of stock.

        Investing activities during the year ended December 31, 2001 were $18.4 million compared to $51.7 million for the year ended December 31, 2000. The 2001 investing activities were capital expenditures of $2.0 million at AdM, $4.0 million at AKW, $3.0 million at Columbia, Tennessee, $5.9 million in the base business, and $3.5 million related to the optimization and consolidation of the Light Wheel manufacturing operations. In 2000, investing activities included capital expenditures of $2.5 million at AdM, $30.5 million at AKW, $5.0 million at Columbia, Tennessee, and $13.7 million in the base business.

        Cash flow from financing activities during the year ended December 31, 2001 was a source of $26.2 million compared to a use of $8.6 million for the year ended December 31, 2000.

        Accuride's capital expenditures in 2001 were $18.4 million. Accuride expects its capital expenditures to be approximately $19.3 million in 2002. It is anticipated that these expenditures will fund (i) investments in productivity and low cost manufacturing improvements in 2002 of approximately $11.8 million (including $9.8 million on the optimization and consolidation of the Light Wheel manufacturing operations); (ii) Equipment and facility maintenance of approximately $6.2 million; and (iii) continuous improvement initiatives of approximately $1.3 million.

        Accuride de Mexico Credit Agreement.    Accuride entered into a $32.5 million credit facility for AdM on July 9, 1998. This credit facility was comprised of a term loan of $25.0 million and a working capital facility of $7.5 million. Interest on the term loan and working capital advances is based on the London interbank offered rate ("LIBOR") plus an applicable margin. Effective September 13, 1999 the AdM credit facility was amended to reflect a parent guaranty executed by Accuride, guaranteeing the repayment of the advances under this facility. Effective December 31, 1999, the AdM credit facility was amended to modify and delete certain covenants that were inconsistent and duplicative with similar covenants contained in Accuride's Amended Credit Agreement described below. Effective March 31, 2000, the AdM credit facility was further amended to terminate Accuride's and AdM's obligations under a completion guaranty for the Monterrey, Mexico, facility. Effective December 14, 2000, the AdM credit facility was further amended to allow AdM to issue shares of capital stock to affiliates of Accuride. In August 2000, AdM elected to prepay the principal installments of the term facility due June 25, 2001, September 25, 2001 and December 25, 2001. The total amount prepaid was $9.3 million. As of December 31, 2001, $15.6 million was outstanding under the term facility and will be repaid in five substantially equal quarterly installments commencing March 25, 2002. The working capital facility was repaid in June 2001.

        Amended and Restated Credit Agreement.    Effective July 27, 2001 Accuride entered into a second amended and restated credit agreement to modify the provisions of our Term Loans and Revolver (the "Amended Credit Agreement"). The Amended Credit Agreement provides for (i) $55.4 million that matures on January 21, 2005 ("Term A"), (ii) $69.3 million that matures on January 21, 2006 ("Term B"), and (iii) $97.0 million that matures on January 21, 2007 ("Term C"). Accuride's Canadian subsidiary is the borrower under Term A, and Accuride has guaranteed the repayment of such borrowing under Term A and all other obligations of the Canadian subsidiary under the Amended Credit Agreement. Accuride also has a $100.0 million Revolver (which may be limited to $87.5 million based on certain leverage ratios) which matures on January 21, 2004. As of December 31, 2001, $50.0 million was outstanding under the Revolver. The Term C loan provides for $1.0 million amortizations on January 21, 2003, January 21, 2004, and January 21, 2005, and $47.0 million amortizations on January 21, 2006 and January 21, 2007. Interest on the term loans and the Revolver is

based on LIBOR plus an applicable margin. The loans are secured by, among other things, the shares of stock, partnership interests and limited liability company ownership interests of Accuride's subsidiaries, and by first priority liens on all unencumbered real, personal, tangible and intangible property. A negative pledge restricts the imposition of other liens or encumbrances on all of the assets, subject to certain exceptions.

        Description of the Notes.    In January 1998 Accuride issued the $200 million Notes pursuant to the Indenture. The Indenture is limited in aggregate principal amount to $300 million, of which $200 million were issued as Private Notes and subsequently exchanged for Exchange Notes, which exchange has been registered under the Securities Act of 1933, as amended. The Indenture provides certain restrictions on the payment of dividends by Accuride. The Indenture is subject to and governed by the Trust Indenture Act of 1939, as amended. The Notes are general unsecured obligations of Accuride and are subordinated in right of payment to all existing and future Senior Indebtedness (as defined in the Indenture). The Notes mature on February 1, 2008. Interest on the Notes accrues at the rate of 9.25% per annum and is due and payable semi-annually in arrears on February 1 and August 1, commencing on August 1, 1998, to holders of record of the Notes on the immediately preceding January 15 and July 15. As of December 31, 2001 the aggregate principal amount of Notes outstanding was $189,900.

        Management believes that cash flow from operations and availability under the Revolver will provide adequate funds for the next twelve months for Accuride's foreseeable working capital needs, planned capital expenditures and debt service obligations. Any future acquisitions, joint ventures or other similar transactions will likely require additional capital, and there can be no assurance that any such capital will be available on acceptable terms or at all. Accuride's ability to fund its working capital needs, planned capital expenditures and scheduled debt payments, to refinance indebtedness and to comply with all of the financial covenants under its debt agreements, depends on its future operating performance and cash flow, which in turn, are subject to prevailing economic conditions and to financial, business and other factors, some of which are beyond Accuride's control.

        Restrictive Debt Covenants.    Accuride's credit documents contain numerous financial and operating covenants that limit the discretion of management with respect to certain business matters. These covenants place significant restrictions on, among other things, the ability to incur additional debt, to create liens, to make certain payments and investments and to sell or otherwise dispose of assets and merge or consolidate with other entities. Accuride is also required to meet certain financial ratios and tests including minimum EBITDA, a leverage ratio, an interest coverage ratio, and a fixed charge coverage ratio. A failure to comply with the obligations contained in the credit documents could result in an event of default, and possibly the acceleration of the related debt and the acceleration of debt under other instruments evidencing indebtedness that may contain cross-acceleration or cross-default provisions. Accuride is currently in compliance with its financial covenants and ratios, although a protracted continuation of negative sales trends could impact our future compliance with such covenants.

        New Accounting Pronouncements.    New accounting standards which could impact the Company include Statement of Financial Accounting Standards (SFAS) No. 142, Accounting for Goodwill and Other Intangible Assets, and SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS No. 142 establishes accounting and reporting standards for goodwill and intangible assets. SFAS No. 142 will become effective for the Company on January 1, 2002. As of the date of adoption, the Company will no longer amortize goodwill, but will test for impairment on an annual basis. Management is still evaluating the full effect of this new accounting standard on the financial statements. As a result of the accounting change, $4,156 of goodwill amortization will not be included in 2002 operating expenses. SFAS 144 is effective for the Company on January 1, 2002. The statement addresses financial accounting and reporting for the impairment of long-lived assets and for long-lived

assets to be disposed. Management is still evaluating the full effect of this new accounting standard on the financial statements.

Industry Outlook

        The commercial vehicle industry is currently in the midst of a severe cyclical downturn. Current industry forecasts by America's Commercial Transportation Publications, the Automotive Market Research Council, and Martin Labbe Associates (collectively referred to as "Analysts"), predict that the North American commercial vehicle industry will continue to be depressed for the first half of 2002 with gradual improvement beginning in the second half of the year. The commercial vehicle industry and the global vehicle industry in general are in a period of transition, marked by intense competition, geographic expansion of manufacturing, and consolidation at both vehicle manufacturer and supplier levels. These trends are expected to continue for the near future. Major OEM customers and their suppliers are consolidating and continue to extend their globalization efforts and emphasize their desire for global support through local production. These customers also continue to reduce the number of suppliers in their supply base.

        In the light vehicle Wheel market in North America, Wheels are now considered to be more integral to styling, and the Company believes that styling and design innovation will continue to play a key role for both steel and aluminum Wheel suppliers in this market.

        Wheels for on-road vehicles, both consumer and commercial, are generally made of steel or aluminum, which offer vehicle OEMs a range of design options. Steel Wheels, which are heavier than aluminum Wheels, are generally lower cost, high volume production products. Aluminum Wheels are lighter in weight, more readily stylized and more expensive than steel Wheels. Market and general economic conditions can significantly impact the relative share of the two materials in both consumer and commercial Wheel markets, due to their large difference in cost and the elasticity of price and demand.

Factors That May Affect Future Results

        In this report, Accuride has made various statements regarding current expectations or forecasts of future events. These statements are "forward-looking statements" within the meaning of that term in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are also made from time-to-time in press releases and in oral statements made by Accuride's officers. Forward-looking statements are identified by the words "estimate," "project," "anticipate," "will continue," "will likely result," "expect," "intend," "believe," "plan," "predict" and similar expressions. Forward looking statements also include statements regarding the gradual improvement in market demand for Heavy Trucks during the second half of 2002, the availability of working capital and additional capital to Accuride, continuation of operational improvements and sources of supply of raw materials, the lack of future supply disruption as a result of labor issues, and improvement in demand for our products and the expansion of our markets. Such forward-looking statements are based on assumptions and estimates, which although believed to be reasonable, may turn out to be incorrect. Therefore, undue reliance should not be placed upon these estimates and statements. Accuride cannot assure that any of these statements or estimates will be realized and actual results may differ from those contemplated in these "forward-looking statements." Accuride undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. You are advised to consult further disclosures Accuride may make on related subjects in its filings with the SEC. Accuride cannot assure that its expectations, beliefs, or projections will result or be achieved or accomplished. In addition to other

factors discussed in the report, some of the important factors that could cause actual results to differ materially from those discussed in the forward-looking statements include the following:

        Significant Indebtedness—Accuride's significant debt could adversely affect its financial resources and prevent it from satisfying its debt service obligations.    Accuride has a significant amount of indebtedness and may also incur additional indebtedness in the future. Accuride may not generate sufficient cash flow from operations, or have future borrowings available to it, sufficient to pay its debt. At December 31, 2001, total indebtedness was $476.6 million and its total stockholders' deficit was $62.4 million.

        Accuride's ability to make debt payments or refinance its indebtedness depends on future performance, which, to a certain extent, is subject to general economic, financial, competitive and other factors, some of which are beyond our control. Based upon Accuride's current level of operations and anticipated growth, management believes that available cash flow, together with available credit, will be adequate to meet its financial needs. There can be no assurance, however, that Accuride's business will generate sufficient cash flow from operations or that future borrowings will be available in an amount sufficient to enable it to pay its debts or to make necessary capital expenditures, or that any refinancing of debt would be available on commercially reasonable terms or at all.

        Accuride's substantial indebtedness could have important consequences including, but not limited to, the following: (i) a substantial decrease in net operating cash flows or an increase in expenses could make it difficult for Accuride to meet its debt service requirements; (ii) a substantial portion of cash flow will be used to pay interest expense and debt amortization, which will reduce the funds that would otherwise be available for operations and future business opportunities; (iii) the ability to obtain additional financing for acquisitions, working capital, capital expenditures, or other purposes may be impaired or unavailable; (iv) Accuride may be more highly leveraged than its competitors, which may place it at a competitive disadvantage; (v) Accuride's substantial indebtedness may make it more vulnerable during a downturn in its business or in the economy generally; and (vi) some of Accuride's existing debt contains financial and restrictive covenants that limit its ability to, among other things, borrow additional funds, dispose of assets, and pay cash dividends.

        A significant portion of our outstanding indebtedness bears interest at variable rates. While Accuride has attempted to limit its exposure to increases in interest rates by entering into interest rate protection agreements, such agreements will not eliminate completely the exposure to variable rates. Any increase in interest rates will reduce funds available to Accuride for its operations and future business opportunities and will exacerbate the consequences of the leveraged capital structure.

Restrictive Debt Covenants—Covenants and restrictions in Accuride's credit documents limit its ability to take certain actions. Accuride's credit documents contain numerous significant financial and operating covenants that limit the discretion of management with respect to certain business matters. These covenants include, among others, significant restrictions on Accuride's ability to:

•

incur certain additional debt;



•

create liens;



•

make certain payments and investments;



•

sell or otherwise dispose of assets;



•

consolidate with other entities; and



•

declare dividends or redeem or repurchase capital stock.

        Accuride must also meet certain financial ratios and tests. Failure to comply with the obligations contained in the credit documents could result in an event of default, and possibly the acceleration of the related debt and the acceleration of debt under other instruments evidencing debt that may contain cross-acceleration or cross-default provisions. Accuride is currently in compliance with its financial covenants, although a continuation of recent negative sales trends could impact our future compliance with such covenants. Should the need arise, Accuride will negotiate with its lenders to modify and expand various financial covenants, however, no assurance can be given that such negotiations will result in modifications that will allow Accuride to continue to be in compliance or otherwise be acceptable to us.

        Cyclical and Seasonal Industry—The wheel industry is cyclical and seasonal, resulting in fluctuations of revenue and income.    The Heavy/Medium Wheel and Light Wheel industries are highly cyclical and, in large part, depend on the overall strength of the demand for Heavy/Medium Trucks, Trailers, and Light Trucks. These industries have historically experienced significant fluctuations in demand based on factors such as general economic conditions, interest rates, government regulations, and consumer confidence. The industry continues to be in the midst of a major downturn. This significant decrease in overall consumer demand for Heavy/Medium Trucks, Trailers, and/or Light Trucks is having a negative impact on Accuride's business. In addition, Accuride's operations are typically seasonal as a result of regular customer maintenance and model changeover shutdowns, which typically occur in the third and fourth quarter of each calendar year. This seasonality may result in decreased net sales and profitability during the third and fourth fiscal quarters of each calendar year.

        Dependence on Major Customers—The loss of one of Accuride's significant customers could have an adverse effect on its business.    Accuride derived approximately 21.3%, 12.4% and 12.1% of its 2001 net sales from Ford, Freightliner and International, respectively. Accuride has been a supplier to these customers for many years. Accuride is continuing to engage in efforts intended to improve and expand its relations with each of these customers. Accuride has supported its position with these customers through direct and active contact with end users, trucking fleets and dealers, and has located certain of its sales personnel in offices near these customers and most of its other major customers. Although Accuride believes that its relationship with these customers is good, Accuride cannot assure that Accuride will maintain or improve these relationships, that these customers will continue to do business with Accuride as they have in the past, or that Accuride will be able to supply these customers or any of its other customers at current levels. The loss of a significant portion of Accuride's sales to Freightliner, Ford and/or International could have a material adverse effect on its business. In addition, the delay or cancellation of material orders from, or problems at, Freightliner, Ford and International or any of its other major customers could have a material adverse effect on its business.

        OEM Supplier Industry—Accuride depends on its customers that are OEMs in the Heavy/Medium Truck, Trailer and Light Truck industries.    Accuride is a supplier to OEMs in the Heavy/Medium Truck, Trailer and Light Truck industries, which are characterized by a small number of OEMs that are able to exert considerable pressure on suppliers to reduce costs, improve quality, and provide enhanced design and engineering capabilities. OEMs continue to demand and receive price reductions and measurable increases in quality through their use of competitive selection processes, rating programs, and various other arrangements. Although Accuride has been able to offset a portion of these price reductions through production cost savings, Accuride cannot assure you that it will be able to generate such cost savings in the future. The inability to generate sufficient production cost savings in the future to offset such price reductions provided to OEMs could adversely affect Accuride's profitability. Additionally, OEMs have generally required suppliers to provide more design engineering input at earlier stages of the product development process, the costs of which have, in some cases, been absorbed by the suppliers. Future price reductions, increased quality standards, or additional engineering capabilities required by OEMs could have a negative impact on our business.

        Labor Relations—The majority of Accuride employees are members of labor unions and any labor disputes could adversely affect its business.    The majority of Accuride's employees are members of labor unions. As of January 1, 2002, approximately 87% of Accuride's employees at the Henderson, Kentucky, facility were represented by the UAW and approximately 78% of Accuride's employees at the Ontario, Canada, facility were represented by the CAW. The approximate percentage of employees at the Erie, Pennsylvania, and Monterrey, Mexico, facilities who are represented by the UAW and the El Sindicato Industrial de Trabajadores de Nuevo Leon is 76% and 80%, respectively. Accuride currently has a lockout at the Henderson, Kentucky, facility (See "Item 1—Business—Employees"). Throughout the lockout period, operations have continued with salaried employees and outside contractors. There has not been, and Accuride believes that there will not be any supply disruption to its customer base; however, there can be no assurance to that effect. A supply disruption to Accuride's customer base could have a material adverse effect on its business.

        Raw Materials—Accuride is vulnerable to significant price increases and shortages.    Accuride uses substantial amounts of raw steel and aluminum. Although steel is generally available from a number of sources, Accuride has obtained favorable sourcing by negotiating and entering into high-volume contracts with third parties with terms ranging from one to three years. Accuride obtains aluminum from various third-party suppliers. While Accuride believes that its supply contracts can be renewed on acceptable terms, Accuride cannot assure that it will be successful in renewing these contracts on such favorable terms or at all. A substantial interruption in the supply of steel or aluminum or inability to obtain a supply of raw steel or aluminum on commercially desirable terms could have an adverse effect on Accuride's business. Although the price of steel has not been volatile in recent periods and Accuride has historically been able to pass through to its customers steel price increases, Accuride cannot assure that rapid and significant changes in the price of steel will not occur in the near future or that it will be able to pass on any such cost increases to its customers. Aluminum prices have been volatile; however, Accuride has used commodity price swaps to protect against the impact of these changes.

        Strong Competition—Accuride operates in a highly competitive environment.    Accuride's product line is broad and it competes with different companies in different markets. Accuride's markets are characterized by companies with substantial capital, established sales forces, extensive research and development facilities and personnel, and other resources. Several of Accuride's competitors have substantially greater financial or other resources and therefore may be more competitive. In addition, OEMs may expand their internal production of Wheels, shift sourcing to other suppliers or take other actions that could reduce the market for Accuride's products and have a negative impact on our business. Accuride may encounter increased competition in the future from existing competitors or new competitors. Also, market expansion and planned entry into additional markets may expose Accuride to an increasing number of well-capitalized competitors.

        Environmental Liabilities—Accuride may be subject to liability under environmental laws.    Accuride is subject to various foreign, federal, state and local environmental laws, ordinances, and regulations, including those governing discharges into the air and water, the storage, handling and disposal of solid and hazardous wastes, the remediation of soil and groundwater contaminated by petroleum products or hazardous substances or wastes, and the health and safety of its employees. Under certain of these laws, ordinances or regulations, a current or previous owner or operator of property may be liable for the costs of removal or remediation of certain hazardous substances or petroleum products on, under, or in its property, without regard to whether the owner or operator knew of, or caused, the presence of the contaminants, and regardless of whether the practices that resulted in the contamination were legal at the time they occurred. The presence of, or failure to remediate properly such substances, may adversely affect the ability to sell or rent such property or to borrow using such property as collateral. Persons who generate, arrange for the disposal or treatment of, or dispose of hazardous substances may be liable for the costs of investigation, remediation or removal of these hazardous substances at or from the disposal or treatment facility, regardless of

whether the facility is owned or operated by that person. Additionally, the owner of a site may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from a site. Accuride believes that it is in material compliance with environmental laws, ordinances and regulations and does not anticipate any material adverse effect on earnings or competitive position relating to environmental matters. It is possible that future developments could lead to material costs of environmental compliance. The nature of Accuride's current and former operations and the history of industrial uses at some of its facilities expose Accuride to the risk of liabilities or claims with respect to environmental and worker health and safety matters which could have a negative impact on its business.

        Key Management—Accuride depends on key management for the success of its business.    Accuride's success depends largely upon the abilities and experience of certain key management personnel. The loss of the services of one or more of these key personnel, and in particular William P. Greubel, President and Chief Executive Officer, could have a negative impact on our business. Accuride does not maintain key-man life insurance policies on any of its executives.

        Control by KKR Affiliates—The rights of Accuride's shareholders could be adversely affected because of the concentrated control of its stock.    As of December 31, 2001, approximately 87% of Accuride's Common Stock was held by Hubcap Acquisition. Hubcap Acquisition is a Delaware limited liability company whose members are KKR 1996 Fund L.P. and KKR Partners II, L.P. KKR 1996 Fund L.P., which owns more than a 95% equity interest in Hubcap Acquisition, is a Delaware limited partnership whose sole general partner is KKR Associates 1996 L.P. KKR Associates 1996 L.P. is a Delaware limited partnership whose sole general partner is KKR 1996 GP L.L.C. KKR 1996 GP L.L.C. is a Delaware limited liability company whose members are also the members of the limited liability company that is the general partner of Kohlberg Kravis Roberts & Co. L.P. ("KKR"). Accordingly, affiliates of KKR control Accuride and have the power to elect all of its directors, appoint new management and approve any action requiring the approval of its shareholders, including adopting amendments to its Certificate of Incorporation and approving mergers or sales of substantially all of its assets. Accuride cannot give any assurance that the interests of KKR and its affiliates will not conflict with the interests of other holders of Accuride's securities.

Item 7A. Quantitative and Qualitative Disclosure about Market Risk

        Accuride, in the normal course of doing business, is exposed to the risks associated with changes in foreign exchange rates, raw material/commodity prices, and interest rates. Accuride uses derivative instruments to manage these exposures. The objectives for holding derivatives are to minimize the risks using the most effective methods to eliminate or reduce the impacts of these exposures.

Foreign Currency Risk

        Certain forecasted transactions, assets, and liabilities are exposed to foreign currency risk. Accuride monitors its foreign currency exposures to maximize the overall effectiveness of its foreign currency derivatives. The principal currency of exposure is the Canadian dollar. Forward foreign exchange contracts, not designated as hedging instruments under SFAS 133, are used to offset the impact of the variability in exchange rates on our operations, cash flows, assets and liabilities. At December 31, 2001, Accuride had open foreign exchange forward contracts of $60.6 million. Foreign exchange forward contract maturities are from one to twelve months. Management believes the use of foreign currency financial instruments reduces the risks that arise from doing business in international markets.

        Accuride's foreign currency derivative contracts provide only limited protection against currency risks. Factors that could impact the effectiveness of Accuride's currency risk management programs include accuracy of sales estimates, volatility of currency markets and the cost and availability of derivative instruments. The counterparty to the foreign exchange contracts is a financial institution with an investment grade credit rating. The use of forward contracts protects Accuride's cash flows against

unfavorable movements in exchange rates, to the extent of the amount under contract. A 10% adverse change in currency exchange rates for the foreign currency derivatives held at December 31, 2001, would have an impact of approximately $6.1 million on the fair value of such instruments. This quantification of exposure to the market risk associated with foreign exchange financial instruments does not take into account the offsetting impact of changes in the fair value of Accuride's foreign denominated assets, liabilities and firm commitments.

Raw Material/Commodity Price Risk

        Accuride relies upon the supply of certain raw materials and commodities in our production processes and we have entered into firm purchase commitments for steel, aluminum, and natural gas. The exposures associated with these commitments are primarily managed through the terms of the sales, supply, and procurement contracts. Additionally, Accuride uses commodity price swaps and futures contracts to manage the variability in certain commodity prices. Commodity price swap and futures contracts, not designated as hedging instruments under SFAS 133, are used to offset the impact of the variability in certain commodity prices on our operations and cash flows. At December 31, 2001, Accuride had open commodity price swaps and futures contracts of $2.2 million. These commodity price swaps and futures contracts had maturities from one to twelve months. A 10% adverse change in commodity prices would have an impact of approximately $.2 million on the fair value of these contracts. Accuride is exposed to credit related losses in the event of nonperformance by the counterparties to the commodity price swaps and futures contracts, although no such losses are expected as the primary counterparty is a financial institution having an investment grade credit rating.

        Interest Rate Risk    Accuride uses long-term debt as a primary source of capital in its business. The following table presents the principal cash repayments and related weighted average interest rates by maturity date for its long-term fixed-rate debt and other types of long-term debt at December 31, 2001:

	2002			2003			2004			2005			2006			Thereafter			Total			Fair Value
	(Dollars in Thousands)
Long-term Debt:
Fixed																$	189,900		$	189,900		$	98,748
Avg. Rate																	9.25	%		9.25	%
Variable	$	12,500		$	4,125		$	51,000		$	56,404		$	116,256		$	47,000		$	287,285		$	255,044
Avg. Rate		5.65	%		6.16	%		6.16	%		8.67	%		7.60	%		7.75	%		7.47	%

        Accuride is exposed to the variability of interest rates on its variable rate debt. Accuride has used an interest rate swap to alter interest rate exposures between fixed and variable rates on a portion of Accuride's long-term debt. As of December 31, 2001, an interest rate swap of $100.0 million was outstanding. Under the terms of the interest rate swap, Accuride agreed with the counterparty to exchange, at specified intervals, the difference between 4.78% and the variable rate interest amounts calculated by reference to the notional principal amount. The interest rate swap was effective in July 2001 and matures in July 2003. In November 2001, Accuride executed a forward-starting interest rate cap to set a ceiling on the maximum floating interest rate Accuride would incur on a portion of Accuride's long-term debt. As of December 31, 2001, $120.0 million notional amount was outstanding on the interest rate cap. Under the terms of the interest rate cap, Accuride is entitled to receive from the counterparty on a quarterly basis the amount, if any, by which the three-month Eurodollar interest rate exceeds 2.73%. The interest rate cap becomes effective in January 2002 and matures in January 2003. The interest rate swap and cap, not designated as hedging instruments under SFAS 133, are used to offset the impact of the variability in interest rates on portions of Accuride's variable rate debt. Accuride is exposed to credit related losses in the event of nonperformance by the counterparties to the interest rate swap and cap, although no such losses are expected as the counterparties are financial institutions having investment grade credit ratings.

Item 8. Financial Statements and Supplementary Data

        Attached, beginning at page F-1.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

        None.

PART III

Item 10. Directors and Executive Officers of the Registrant

Directors and Executive Officers

        The directors and executive officers of the Company, and their ages as of December 31, 2001, are as follows:

Name	Age	Position
William P. Greubel	50	Director, President and Chief Executive Officer
John R. Murphy	51	Executive Vice President/Finance and Chief Financial Officer
David K. Armstrong	45	Senior Vice President and General Counsel
Richard J. Giromini	48	Senior Vice President/Technology and Continuous Improvement
Elizabeth I. Hamme	51	Senior Vice President/Human Resources
Terrence J. Keating	52	Senior Vice President and General Manager—Wheels
Henry R. Kravis	57	Director
George R. Roberts	58	Director
James H. Greene, Jr.	51	Director
Todd A. Fisher	36	Director
Frederick M. Goltz	30	Director

        William P. Greubel.    Mr. Greubel has been a director and the Chief Executive Officer of the Company since January 21, 1998. Mr. Greubel has been president of the Company since 1994. He is also a director of AOT. Prior to joining the Company, from 1974 to 1994, Mr. Greubel held positions at AlliedSignal Corporation in sales, marketing and operations. His last two positions were Vice President and General Manager for the Environmental Catalysts and Engineering Plastics businesses. Mr. Greubel holds a B.A. in Economics and an M.B.A. from Rutgers University.

        John R. Murphy.    Mr. Murphy currently serves as Executive Vice President/Finance and Chief Financial Officer. Mr. Murphy joined the Company in March, 1998 as Vice President/Finance and Chief Financial Officer. Prior to joining the Company, Mr. Murphy was the President and Chief Executive Officer of Falconite, Inc., a privately held rental equipment company. From 1994 to 1997, Mr. Murphy was Executive Vice President-Administration, Chief Financial Officer and Corporate Secretary of North American Stainless, Inc. Mr. Murphy also held the position of Vice President of Finance and Strategic Planning for Armco Advanced Materials Company, a stainless and electrical specialty steel manufacturing company. Mr. Murphy holds a B.S. in Accounting from the Pennsylvania State University and an M.B.A. from the University of Colorado.

        David K. Armstrong.    Mr. Armstrong currently serves as Senior Vice President and General Counsel. He also serves as Corporate Secretary. Mr. Armstrong joined the Company in October, 1998. Prior to joining the Company, Mr. Armstrong was a partner at the law firm of Snell & Wilmer L.L.P. Mr. Armstrong holds a B.S. and MAcc in Accounting and a Juris Doctorate, all from Brigham Young University.

        Richard J. Giromini.    Mr. Giromini currently serves as Senior Vice President/Technology and Continuous Improvement. Mr. Giromini joined the Company, as Vice President/General Manager of AKW L.P. in April 1998 and served as President and CEO of AKW L.P. from August 1998 through April 1999. From 1996 to 1998, Mr. Giromini was a Director of Manufacturing of ITT Automotive Inc. From 1991 to 1996, Mr. Giromini held the positions of Vice President/Operations and Plant General Manager of Hayes Wheels International, Inc. Mr. Giromini holds a B.S. in Mechanical and Industrial Engineering and a M.S. in Industrial Management from Clarkson University.

        Elizabeth I. Hamme.    Ms. Hamme currently serves as Senior Vice President/Human Resources. Ms. Hamme joined the Company, as Vice President/Human Resources in February 1995. Prior to joining the Company, Ms. Hamme served as an independent consultant to the manufacturing and financial services sectors since 1991. From 1989 to 1991, Ms. Hamme held the positions of Division Human Resources Manager and Group Manager of Human Resources Development and Compensation with FMC Corporation (Chemical Products Group). Ms. Hamme holds a B.A. in Political Science and an M.A. in Adult Education from the George Washington University.

        Terrence J. Keating.    Mr. Keating currently serves as Senior Vice President and General Manager-Wheels. Mr. Keating also serves as President of Accuride Canada, Inc. Mr. Keating joined the Company in December, 1996 as Vice President-Operations. From 1995 to November, 1996, Mr. Keating was the manager of Indianapolis Diesel Engine Plant of International Truck and Engine Corporation, a division of Navistar International Company. From 1990 to 1995, Mr. Keating was Vice President of Operations of Peerless Pump, Inc. Mr. Keating holds a B.S. in Mechanical Engineering Technology from Purdue University and an M.B.A. in Operations from Indiana University. He is certified by the American Production and Inventory Control Society (APICS) as an inventory management professional.

        Henry R. Kravis.    Mr. Kravis has been a director of the Company since 1998. He is a managing member of KKR & Co., L.L.C., the limited liability company which serves as the general partner of KKR. He is also a director of the following public companies: Alliance Imaging, Inc., Amphenol Corporation, Birch Telecom, Inc., Borden, Inc., The Boyds Collection, Ltd., Evenflo Company, Inc. The Gillette Company, IDEX Corporation, KinderCare Learning Centers, Inc., KSL Recreation Corporation, PRIMEDIA, Inc., Sotheby's Holdings Inc., Spalding Holdings Corporation, and Willis Group Holdings Limited. Mr. Kravis is a first cousin of Mr. Roberts.

        George R. Roberts.    Mr. Roberts has been a director of the Company since 1998. He is a managing member of KKR & Co., L.L.C., the limited liability company which serves as the general partner of KKR. He is also a director of the following public companies: Alliance Imaging, Inc., Amphenol Corporation, Borden, Inc., Birch Telecom, Inc., The Boyds Collection, Ltd., Evenflo Company, Inc., IDEX Corporation, KinderCare Learning Center, Inc., KSL Recreation Corporation, Owens-Illinois, Inc., PRIMEDIA, INC., Safeway, Inc., Spalding Holdings Corporation, Willis Group Holdings Limited, and Dayton Power and Light Inc. Mr. Roberts is a first cousin of Mr. Kravis.

        James H. Greene, Jr.    Mr. Greene has been a director of the Company since 1998. He is a member of KKR & Co., L.L.C., the limited liability company which serves as the general partner to KKR. He is also a director of the following public companies: Owens-Illinois, Inc., Safeway Inc., Birch Telecom, Inc., and Shoppers Drug Mart Corporation.

        Todd A. Fisher.    Mr. Fisher has been a director of the Company since 1998. He has been a member of KKR & Co., L.L.C. since January 1, 2001 and was an executive of KKR from June 1993 to December 31, 2000. From July 1992 to June 1993, Mr. Fisher was an associate at Goldman, Sachs & Co. Mr. Fisher also serves as a director of the following public companies: Layne Christensen Company, and Willis Group Holdings Limited.

        Frederick M. Goltz.    Mr. Goltz has been a director of the Company since 1999. He has been an executive of KKR since 1995 with the exception of the period from July 1997 to July 1998 during which time he earned an MBA at INSEAD. Prior to 1995, he was with Furman Selz Incorporated in its Corporate Finance Department.

Item 11. Executive Compensation

        Compensation of Directors.    Members of the Board of Directors employed by the Company do not receive any separate compensation for services performed as a director. Those members of the Board of Directors not otherwise employed by the Company receive a $30,000 annual retainer. There is no separate compensation for service on the compensation or audit committees. See also "Item 13-Certain Relationships and Related Transactions."

Summary Compensation Table

        The following table sets forth information with respect to the compensation paid by the Company for services rendered during the year ended December 31, 2001 to the Chief Executive Officer and to each of the four other most highly compensated executive officers of the Company (the "Named Executive Officers").

								Long Term Compensation
		Annual Compensation						Awards		Payouts
Name and Principal Position	Year	Salary		Bonus		Other Annual Compensation(a)		Restricted Stock Award(s)	Securities Underlying Options/SARs	LTIP Payouts	All Other Compensation(b)
William P. Greubel (President and Chief Executive Officer)	2001 2000 1999	$ $ $	378,125 375,000 275,040	$ $ $	210,937 326,574 172,685	$ $ $	14,183 14,867 16,349	— — —	— — —	— — —	$ $ $	141,983 194,733 22,553
John R. Murphy (Executive Vice President/Finance & CFO)	2001 2000 1999	$ $ $	270,000 239,788 195,600	$ $ $	140,625 239,309 102,175	$ $ $	9,532 22,168 23,645	— — —	— — —	— — —	$ $ $	83,522 88,427 8,239
Terrence J. Keating (Senior Vice President and General Manager/Wheels)	2001 2000 1999	$ $ $	202,910 201,240 167,040	$ $ $	75,465 130,448 78,447	$ $ $	9,533 20,692 26,228	— — —	— — —	— — —	$ $ $	52,330 79,444 12,747
David K. Armstrong (Senior Vice President and General Counsel)	2001 2000 1999	$ $ $	181,200 179,700 156,000	$ $ $	67,388 146,340 22,533	$ $ $	14,808 24,838 28,296	— — —	— — —	— — —	$ $ $	36,704 43,116 2,817
Richard J. Giromini (c) Senior Vice President/Technology and CI	2001 2000 1999	$ $ $	191,930 178,808 81,000	$ $	67,053 130,457 —	$ $ $	9,588 18,479 13,809	— — —	— — —	— — —	$ $ $	41,134 25,374 1,595

(a)

Compensation includes financial planning service fees, vacation sold, gift certificate, imputed income, overseas travel incentive, and gross-ups on financial planning and gift certificate as follows:

	Year	Financial Planning Service Fees Plus Gross-up		Vacation Sold		Gift Certificate Plus Gross-up		Imputed Income		Overseas Travel Incentive
Mr. Greubel	2001 2000 1999	$ $ $	10,235 11,944 11,733	$ $	— 2,885 4,616	$	— 38 —		— — —	$	3,948 — —
Mr. Murphy	2001 2000 1999	$ $ $	9,532 11,944 17,104	$ $	— 3,762 6,541	$	— 38 —		— — —	$	— 6,424 —
Mr. Keating	2001 2000 1999	$ $ $	9,533 11,944 21,274	$ $	— 6,951 4,954	$	— 38 —		— — —	$	— 1,759 —
Mr. Armstrong	2001 2000 1999	$ $ $	9,625 12,053 21,083	$ $ $	5,184 3,058 7,213	$	— 37 —		— — —	$	9,690 —
Mr. Giromini	2001 2000 1999	$ $ $	9,588 14,201 10,840	$ $	— 3,115 2,885		— — —	$	— 84	$	— 1,163 —

(b)

Compensation includes contributions made by the Company to the employees' non-qualified savings plan (company match and/or profit sharing), non-qualified deferred liability, the Executive Life Insurance Plan (which provides employees with a

bonus to pay for a universal life insurance policy that is fully owned by the employee), personal excess coverage, and gross-ups on non-qualified deferred liability and personal excess coverage as set forth below:

	Year	Make Whole Contrib. to Supplemental Savings Plan Plus Gross-Up		Company Match & Profit Sharing		ELIP Premiums		Umbrella Insurance Premium Plus Gross-up
Mr. Greubel	2001 2000 1999	$ $ $	80,870 173,635 54	$ $ $	22,200 19,445 17,184	$ $	38,913 — 5,315	$	— 1,653 —
Mr. Murphy	2001 2000 1999	$ $ $	42,705 72,945 27	$ $ $	14,194 13,829 5,610	$ $	26,623 — 2,602	$	— 1,653 —
Mr. Keating	2001 2000 1999	$ $	18,992 66,726 —	$ $ $	12,010 11,810 10,246	$ $	21,327 — 2,501	$	— 908 —
Mr. Armstrong	2001 2000 1999	$ $	11,412 31,170 —	$ $ $	10,638 11,029 1,624	$ $	14,654 — 1,193	$	— 917 —
Mr. Giromini	2001 2000 1999	$ $	12,299 18,734 —	$ $	10,585 5,727 —	$ $	18,250 — 1,595	$	— 913 —

(c)

Mr. Giromini transferred from AKW L.P. to Accuride Corporation effective July 1, 1999.

        The following table gives information for options exercised by each of the Named Executive Officers in 2001 and the value (stock price less exercise price) of the remaining options held by those executive officers at year end, using management's estimate of the Common Stock value on December 31, 2001.

Aggregated Option/SAR Exercises in Last Fiscal Year
and Fiscal Year-End Option/SAR Values

				Number of Securities Underlying Unexercised Options/SARs at Fiscal Year-End		Value of Unexercised In-the-Money Options/SARs at Fiscal Year-End(a)
Name	Shares Acquired on Exercise	Value Realized
				Exercisable	Unexercisable	Exercisable	Unexercisable
William P. Greubel	0	$	0	292.5	67.5	—	—
John R. Murphy	0	$	0	113.9	26.3	—	—
Terrence Keating	0	$	0	52	12	—	—
David K. Armstrong	0	$	0	52	12	—	—
Richard J. Giromini	0	$	0	36	20	—	—

(a)

The value of the shares underlying the options as of December 31, 2001 is not in excess of the base price. There is no established trading market for the Company's Common Stock.

Pension Plan Disclosure

        The Accuride Cash Balance Pension Plan (the "Retirement Plan") covers certain employees of the Company. Under the Retirement plan, each participant has a "cash balance account" which is established for bookkeeping purposes only. Each year, each participant's cash balance account is credited with a percentage of the participant's earnings (as defined in the Retirement Plan). The percentage ranges from 2% to 11.5%, depending on the participant's age, years of service and date of participation in the Retirement Plan. If a participant has earnings above the Social Security taxable wage base ("excess earnings"), then an additional 2% of the excess earnings amount is credited to the participant's account. Participant's accounts also are credited with interest each year, based upon the rates payable on certain U.S. Treasury debt instruments. Employees first becoming participants after January 1, 1998 also receive an additional credit for their first year of service.

        A participant's benefit at normal retirement age, if calculated as a lump sum payment, equals the balance of his cash balance account. The actuarial equivalent of the account balance also can be paid as a single life annuity, a qualified joint and survivor annuity, or an alternative form of payment allowed under the Retirement Plan.

        The estimated annual benefits payable upon retirement at normal retirement age (assuming continued compensation at the present amounts until normal retirement age and continued crediting of interest at the current rate and disregarding cost-of-living adjustments to the compensation limit, limits under Section 415 of the Internal Revenue Code or the Social Security wage base) for each of the following Named Executive Officers are:

William P. Greubel	$	224,600
John R. Murphy	$	132,400
Terrence J. Keating	$	89,500
David K. Armstrong	$	116,300
Richard J. Giromini	$	102,200

1998 Stock Purchase and Option Plan

        In early 1998, the Company adopted the 1998 Stock Purchase and Option Plan for Key Employees of Accuride Corporation and Subsidiaries (the "1998 Plan").

        The 1998 Plan provides for the issuance of shares of authorized but unissued or reacquired shares of Common Stock, subject to adjustment to reflect certain events such as stock dividends, stock splits, recapitalizations, mergers or reorganizations of or by the Company. The 1998 Plan is intended to assist the Company in attracting and retaining employees of outstanding ability and to promote the identification of their interests with those of the stockholders of the Company. The 1998 Plan permits the issuance of Common Stock (the "Plan-Purchase Stock") and the grant of Non-Qualified Stock Options (the "Plan-Options") to purchase shares of Common Stock (the issuance of Plan-Purchase Stock and the grant of Plan-Options pursuant to the 1998 Plan being a "Plan Grant"). Unless sooner terminated by the Company's Board of Directors, the 1998 Plan will expire ten years after adoption. Such termination will not affect the validity of any Plan Grant outstanding on the date of the termination.

        The Compensation Committee of the Board of Directors administers the Plan, including, without limitation, the determination of the employees to whom Plan Grants will be made, the number of shares of Common Stock subject to each Plan Grant, and the various terms of Plan Grants. The Compensation Committee of the Board of Directors may from time to time amend the terms of any Plan Grant, but, except for adjustments made upon a change in the Common Stock by reason of a stock split, spin-off, stock dividend, stock combination or reclassification, recapitalization, reorganization, consolidation, change of control, or similar event, such action shall not adversely affect

the rights of any participant under the 1998 Plan with respect to the Plan-Purchase Stock and the Plan-Options without such participant's consent. The Board of Directors retains the right to amend, suspend or terminate the 1998 Plan.

Severance Agreements

        Accuride has entered into severance agreements with senior management employees, including the Named Executive Officers, pursuant to which in the event of any such employee's termination "without cause" or "for good reason" (as defined therein) the Company will pay such employee one year's base salary.

        In addition to the severance agreements described above, Accuride has entered into change-in-control agreements with senior management employees, including the Named Executive Officers, and certain other key executives of the Company. Under these agreements, each participating executive is entitled to severance benefits if his or her employment with the Company is terminated within eighteen months of a change in control of the Company (as defined in the agreement) either by the employee for good reason or by the Company for any reason other than cause, disability, normal retirement, or death. In the event of a covered termination, (a) severance benefits for Tier I (Messrs. Greubel and Murphy) include a payment equal to 300% of the employee's salary plus average incentive compensation award over the prior three years, (b) severance benefits for Tier II (Messrs. Keating, Giromini, Armstrong and Ms. Hamme) include a payment equal to 200% of the employee's salary plus average incentive compensation award over the prior three years, (c) severance benefits for Tier III (other key executives) include a payment equal to 100% of the employee's salary. The agreements also provide for the continuance of certain other benefits, including health insurance coverage until the earlier of the employee becoming eligible for coverage by a subsequent employer or the expiration of 18 months from the date of termination. Any payment received under the change-in-control agreement shall be reduced by the full amount of any payments to which the executive may be entitled due to termination pursuant to any other Company severance policy.

Employee Equity Arrangements

        Pursuant to the 1998 Plan, the Company sold Plan-Purchase Stock and issued Plan-Options to selected employees, including the Named Executive Officers, which represent, in the aggregate, approximately 8% of the fully diluted Common Stock (of which the Named Executive Officers will hold approximately 47%). In connection with such arrangements, the Company and each such employee entered into an Employee Stockholders' Agreement and a Stock Option Agreement. In order to finance the stock purchases, certain employees also entered into secured Promissory Notes and Pledge Agreements. The Employee Stockholders' Agreement (i) places restrictions on each such employee's ability to transfer shares of Plan-Purchase Stock and Common Stock acquired upon exercise of the Plan-Options, including a right of first refusal in favor of the Company, (ii) provides each such employee the right to participate pro rata in certain sales of Common Stock by Hubcap Acquisition or its affiliates and (iii) provides Hubcap Acquisition and its affiliates the right to require each such employee to participate pro rata in certain sales of Common Stock by Hubcap Acquisition or its affiliates. The Stockholders' Agreement also grants (subsequent to an initial public offering of the Common Stock) piggyback registration rights to each such employee pursuant to a registration rights agreement between Hubcap Acquisition and the Company. In addition, the Employee Stockholders' Agreement gives the Company the right to purchase shares and options held by each such employee upon termination of employment for any reason and permits each such employee to sell stock and options in the event of death, disability or retirement after turning 65 years of age.

Compensation Committee Interlocks and Insider Participation

        Messrs. Greene, Fisher, and Goltz, with Mr. Greene as Chairman, serve as the members of the Compensation Committee of the Board of Directors of the Company. Messrs. Greene and Fisher are members of KKR 1996 GP L.L.C., which beneficially owns 87% of Accuride, and members of KKR & Co., L.L.C., which serves as general partner of KKR. Mr. Goltz is an executive of KKR & Co., L.L.C.

Item 12. Security Ownership of Certain Beneficial Owners and Management

        The following table sets forth the ownership of the Common Stock as of March 1, 2002 by each person known to be the owner of 5% or more of the Common Stock, by each person who is a director or Named Executive Officer of the Company and by all directors and executive officers of the Company as a group.

		Common Stock Beneficially Owned(a)
Name and Address
		Shares	Percent
KKR 1996 GP L.L.C. (b) c/o Kohlberg Kravis Roberts & Co. L.P. 9 West 57th Street New York, New York 10019		21,600	87.11	%
	Henry R. Kravis (b)	—	—
	George R. Roberts (b)	—	—
	James H. Greene, Jr. (b)	—	—
	Todd A. Fisher (b)	—	—
	Frederick M. Goltz (b)	—	—
RSTW Partners III, L.P. (c) 5847 San Felipe Houston, TX 77057		2,400	9.68	%
William P. Greubel (d)		443	1.79	%
John R. Murphy (e)		184	*
Terrence J. Keating (f)		92	*
David K. Armstrong (f)		92	*
Richard J. Giromini (g)		76	*
All executive officers and directors as a group		978	3.95	%

*

Less than one percent.

(a)

The amounts and percentage of Common Stock beneficially owned are reported on the basis of regulations of the Securities and Exchange Commission ("SEC") governing the determination of beneficial ownership of securities. Under the rules of the SEC, a person is deemed to be a "beneficial owner" of a security if that person has or shares "voting power," which includes the power to vote or to direct the voting of such security, or "investment power," which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days. Under these rules, more than one person may be deemed a beneficial owner of the same securities and a person may be deemed to be a beneficial owner of securities as to which he has no economic interest. The percentage of class outstanding is based on 24,796 shares of Common Stock outstanding as of March 1, 2002

(b)

Shares of Common Stock shown as beneficially owned by KKR 1996 GP L.L.C. are held by Hubcap Acquisition. KKR 1996 GP L.L.C. is the sole general partner of KKR Associates 1996

L.P., which is the sole general partner of KKR 1996 Fund L.P. KKR 1996 Fund L.P. is one of two members of Hubcap Acquisition and owns more than a 95% equity interest in Hubcap Acquisition. KKR 1996 GP L.L.C. is a limited liability company, the managing members of which are Messrs. Henry R. Kravis and George R. Roberts, and the other members of which are Messrs. Paul E. Raether, Michael W. Michelson, James H. Greene, Jr., Michael T. Tokarz, Edward A. Gilhuly, Perry Golkin, Scott M. Stuart, Johannes P. Huth, Todd A. Fisher, Alexander Navab Jr., Neil A. Richardson and Robert I. MacDonnell. Messrs. Kravis, Roberts, Greene, and Fisher are directors of the Company. Each of such individuals may be deemed to share beneficial ownership of any shares beneficially owned by KKR 1996 GP L.L.C. Each of such individuals disclaims beneficial ownership. Mr. Frederick M. Goltz is a director of the Company and is also an executive of KKR. Mr. Goltz disclaims that he is the beneficial owner of any shares beneficially owned by KKR Associates 1996 L.P.

(c)

RSTW Management, L.P. is the sole general partner of RSTW Partners III, L.P.; Rice Mezzanine Corporation ("RMC") is the general partner of RSTW Management, L.P. RMC is a subchapter S-Corporation, the shareholders of which are Messrs. Don K. Rice, Jeffrey P. Sangalis, Jeffrey A. Toole, and James P. Wilson. Each of such individuals may be deemed to share beneficial ownership of any shares beneficially owned by RSTW Partners III, L.P. Each of such individuals disclaims beneficial ownership.

(d)

Includes 292.5 shares, which are subject to an option to purchase such shares from the Company at $5,000 per share.

(e)

Includes 113.9 shares, which are subject to an option to purchase such shares from the Company at $5,000 per share.

(f)

Includes 52 shares, which are subject to an option to purchase such shares from the Company at $5,000 per share.

(g)

Includes 36 shares, which are subject to an option to purchase such shares from the Company at $5,000 per share.

Item 13. Certain Relationships and Related Party Transactions

        As of March 1, 2002, KKR 1996 GP L.L.C. beneficially owned approximately 87% of the Company's outstanding shares of Common Stock. See "Item 12-Security Ownership of Certain Beneficial Owners and Management." The managing members of KKR 1996 GP L.L.C. are Messrs. Henry R. Kravis and George R. Roberts and the other members of which are Messrs. Paul E. Raether, Michael W. Michelson, James H. Greene, Jr., Michael T. Tokarz, Edward A. Gilhuly, Perry Golkin, Scott M. Stuart, Johannes P. Huth, Todd A. Fisher, Alexander Navab Jr., Neil A. Richardson, and Robert I. MacDonnell. Messrs. Kravis, Roberts, Greene, and Fisher are also directors of the Company, as is Frederick M. Goltz, who is an executive of KKR & Co., L.L.C. Each of the members of KKR 1996 GP L.L.C. is also a member of KKR & Co., L.L.C, which serves as the general partner of KKR.

        KKR, an affiliate of Hubcap Acquisition, received a fee of $6.0 million in cash for negotiating the Recapitalization and arranging the related financing, plus the reimbursement of its expenses in connection therewith, and from time to time in the future, KKR may receive customary investment banking fees for services rendered to the Company in connection with divestitures, acquisitions, and certain other transactions. In addition, KKR has agreed to render management, consulting and financial services to the Company for an annual fee of $0.6 million. See "Item 10-Directors and Executive Officers of the Company" and "Item 12-Security Ownership of Certain Beneficial Owners and Management."

        Hubcap Acquisition has the right, under certain circumstances and subject to certain conditions, to require the Company to register under the Securities Act shares of Common Stock held by it pursuant to the registration rights agreement between Hubcap Acquisition and the Company and the stockholders agreement among Hubcap Acquisition, the Company, and Phelps Dodge. Such registration rights are generally available to Hubcap Acquisition until registration under the Securities Act is no longer required to enable it to resell the Common Stock owned by it. The registration rights agreement provides, among other things, that the Company will pay all expenses in connection with the first six demand registrations requested by Hubcap Acquisition and in connection with any registration commenced by the Company as a primary offering in which Hubcap Acquisition participates through piggyback registration rights granted under such agreement. Hubcap Acquisition's exercise of its registration rights under the registration rights agreement is subject to the tag along and the drag along rights of certain other stockholders provided for in the stockholders agreement.

        During 2001, 41 shares of common stock were repurchased as treasury stock.

PART IV

Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

        (a)  The following constitutes a list of Financial Statements, Financial Statement Schedules, and Exhibits required to be included in this report:

1.	Financial Statements
	The following financial statements of the Registrant are filed herewith as part of this report:
	Independent Auditors' Report.
	Consolidated Balance Sheets—December 31, 2001 and December 31, 2000.
	Consolidated Statements of Income—Years ended December 31, 2001, December 31, 2000, and December 31, 1999.
	Consolidated Statements of Stockholders' Equity (Deficiency)—Years ended December 31, 2001, December 31, 2000, and December 31, 1999.
	Consolidated Statements of Cash Flows—Years ended December 31, 2001, December 31, 2000, and December 31, 1999.
	Notes to Consolidated Financial Statements—Years ended December 31, 2001, December 31, 2000, and December 31, 1999.
2.	Financial Statement Schedules
	Schedule II—Valuation and Qualifying Accounts.
	Schedules other than those listed above are omitted because of the absence of conditions under which they are required or because the required information is presented in the Financial Statements or notes thereto.

Exhibits

        (b)  Reports on Form 8-K. The Company did not file any reports on Form 8-K during the last quarter of the 2001 fiscal year.

Exhibit No.	Description
*2.1	Stock Subscription and Redemption Agreement, dated as of November 17, 1997, among the Company, Hubcap Acquisition L.L.C. and Phelps Dodge Corporation.
*3.1	Certificate of Incorporation, as amended, of Accuride Corporation.
*3.2	By-Laws of Accuride Corporation.
*4.1	Indenture, dated as of January 21, 1998, between Accuride Corporation and U.S. Trust Company of California, N.A., as trustee, relating to $200,000,000 aggregate principal amount of 9.25% Senior Subordinated Notes due 2008.
*4.2	Registration Rights Agreement, dated as of January 21, 1998, between Accuride Corporation, and BT Alex. Brown Incorporated, Citicorp Securities, Inc., and J.P. Morgan Securities Inc.
*4.3	Specimen Certificate of 9.25% Senior Subordinated Notes due 2008, Series A (the "Private Notes").
*4.4	Specimen Certificate of 9.25% Senior Subordinated Notes due 2008, Series B (the "Exchange Notes").
*10.1	Stockholders' Agreement by and among Accuride Corporation, Phelps Dodge Corporation and Hubcap Acquisition L.L.C.
*10.2	Registration Rights Agreement by and between Accuride Corporation and Hubcap Acquisition L.L.C.
‡*10.3	1998 Stock Purchase and Option Plan for Employees of Accuride Corporation and Subsidiaries.
‡*10.4	Form of Non-qualified Stock Option Agreement by and between Accuride Corporation and certain employees.
‡*10.5	Form of Repayment and Stock Pledge Agreement by and between Accuride and certain employees.
*10.6	Form of Secured Promissory Note in favor of Accuride Corporation.
*10.7	Form of Stockholders' Agreement by and among Accuride Corporation, certain employees and Hubcap Acquisition L.L.C.
‡*10.8	Form of Severance Agreement by and between Accuride Corporation and certain executives.
*10.9	Contribution Agreement, dated as of May 1, 1997, among Accuride Corporation, Kaiser Aluminum & Chemical Corporation, AKW General Partner L.L.C. and AKW L.P.
*10.10	Limited Partnership Agreement of AKW L.P., dated as of May 1, 1997, among AKW General Partner L.L.C., Accuride Ventures, Inc., Accuride Corporation and Kaiser Aluminum & Chemical Corporation.
*10.11	Limited Liability Company Agreement of AKW General Partner L.L.C., dated as of May 1, 1997, among Accuride Ventures, Inc., Accuride Corporation and Kaiser Aluminum & Chemical Corporation.
*10.12	Lease Agreement dated November 1, 1988, by and between Kaiser Aluminum & Chemical Corporation and The Bell Company regarding the property in Cuyahoga Falls, Ohio, as amended and extended.
*10.13	Lease Agreement, dated as of February 1, 1974, by and between Henderson County and The Firestone Tire & Rubber Company.
*10.14	Lease Amendment, dated as of December 19, 1986, by and between Henderson County and The Firestone Tire & Rubber Company.
*10.15	Joint Venture Agreement, dated November 5, 1997, by and among the Company, Industria Automotriz, S.A. de C.V., Grupo Industrial Ramirez, S.A. and Accuride de Mexico, S.A. de C.V.
*10.16	By-laws of Accuride de Mexico, S.A. de C.V.
*10.17	Purchase and Sale Agreement, dated as of October 21, 1997, by and between Accuride Corporation and General Electric Company regarding property located in Columbia, Tennessee.
*10.18	Purchase Supply and Assembly Agreement, dated as of January 15, 1998, between Accuride Corporation and Lacks Industries, Inc.

*10.19	Purchase Agreement, dated as of January 15, 1998, between Accuride Corporation and BT Alex. Brown Incorporated, Citicorp Securities, Inc., and J.P. Morgan Securities Inc.
**10.20	Lease Agreement dated October 26, 1998, by and between Accuride Corporation and Woodward, LLC. regarding the Evansville, Indiana, office space.
***10.21	Purchase Agreement dated April 1, 1999, between the Company, Accuride Ventures, Inc. (the Company's wholly-owned subsidiary) and Kaiser.
***10.22	Amended and Restated Lease Agreement dated April 1, 1999, between AKW, L.P. and Kaiser.
****10.23	Amended and Restated Credit Agreement, dated April 16, 1999, between the Company, Citicorp USA, Inc., as administrative agent, Salomon Smith Barney, Inc., as arranger, Bankers Trust Company as syndication agent, and Wells Fargo Bank, N.A. as the documentation agent.
****10.24	Amended and Restated Pledge Agreement dated April 16, 1999, between the Company, Accuride Canada, Inc., and Accuride Ventures, Inc. as pledgors and Citicorp USA, Inc., as administrative agent.
†10.25	Purchase Agreement dated July 16, 1999 between the Company and Industria Automotriz, S.A. de C.V.
†10.26	Amended and Restated Completion Guarantee dated July 16, 1999 between the Company, Accuride de Mexico, S.A. de C.V., Citibank Mexico, S.A. and Grupo Financiero Citibank.
*10.27	Amendment dated December 31, 1999 between the Company, Accuride de Mexico, S.A. de C.V., Citibank Mexico, S.A. and Grupo Financiero Citibank.
‡*10.28	Amended and Restated Supplemental Savings Plan dated January 1, 1998.
†††10.29	Amendment dated March 31, 2000 between the Company, Accuride de Mexico, S.A. de C.V., Citibank Mexico, S.A. and Grupo Financiero Citibank.
†††10.30	Amendment dated December 14, 2000 between the Company, Accuride de Mexico, S.A. de C.V., Citibank Mexico, S.A. and Grupo Financiero Citibank.
†††10.31	Joint Marketing Agreement between the Company and Gianetti Ruote SpA.
†††10.32	Technology Cross License Agreement between the Company and Gianetti Ruote SpA.
††††10.33	Second Amended and Restated Credit Agreement
††††10.34	Second Amended and Restated Pledge Agreement
††††10.35	Security Agreement between the Company, Accuride Canada, Inc., and Citicorp USA, Inc.
††††10.36	Security Agreement between Accuride Canada, Inc., and Citicorp USA, Inc.
10.37	Form of Change-In-Control Agreement (Tier I employees)
10.38	Form of Change-In-Control Agreement (Tier II employees)
10.39	Form of Change-In-Control Agreement (Tier III employees)
21.1	Subsidiaries of Accuride Corporation.
23.1	Consent of Deloitte & Touche LLP.

*	Previously filed as an exhibit to the Form S-4 effective July 23, 1998 (Reg. No. 333-50239) and incorporated herein by reference.
**	Previously filed as an exhibit to the Form 10-K filed on March 30, 1999 and incorporated herein by reference.
***	Previously filed as an exhibit to the Form 8-K filed on April 12, 1999 and incorporated herein by reference.
****	Previously filed as an exhibit to the Form 10-Q for the quarterly period ended March 31, 1999 and incorporated herein by reference.
†	Previously filed as an exhibit to the Form 10-Q for the quarterly period ended June 30, 1999 and incorporated herein by reference.
‡	Management contract for compensatory plan or arrangement required to be filed as an exhibit pursuant to Item 14(c) of Form 10-K.
†††	Previously filed as an exhibit to the Form 10-K filed on March 26, 2001 and incorporated herein by reference.
††††	Previously filed as an exhibit to the Form10-Q filed on August 9, 2001.

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of Accuride Corporation:

        We have audited the accompanying consolidated balance sheets of Accuride Corporation and subsidiaries as of December 31, 2001 and 2000, and the related consolidated statements of income, stockholders' equity (deficiency) and cash flows for each of the three years in the period ended December 31, 2001. Our audits also included the financial statement schedule listed in the Index at Item 14. These financial statements and the financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and the financial statement schedule based on our audits.

        We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance 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. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

        In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Accuride Corporation and subsidiaries as of December 31, 2001 and 2000, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2001 in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

DELOITTE & TOUCHE LLP
Indianapolis, Indiana

February 11, 2002

ACCURIDE CORPORATION

CONSOLIDATED BALANCE SHEETS

AS OF DECEMBER 31, 2001 AND 2000 (DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)

			2001			2000
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents		$	47,708		$	38,516
	Customer receivables, net of allowance for doubtful accounts of $1,448 and $806			25,163			31,059
	Other receivables			2,229			4,325
	Inventories, net			29,107			37,484
	Supplies			8,666			8,545
	Deferred income taxes			6,219			5,175
	Income taxes receivable			1,176			599
	Prepaid expenses and other current assets			792			941
		Total current assets		121,060			126,644
PROPERTY, PLANT AND EQUIPMENT, NET				225,514			237,410
OTHER ASSETS:
	Goodwill, net of accumulated amortization of $43,105 and $38,949			123,197			127,353
	Investment in affiliates			3,439			3,189
	Deferred financing costs, net of accumulated amortization of $6,527 and $4,436			8,776			9,546
	Deferred income taxes			2,930
	Pension benefit plan asset			11,558			9,678
	Other			1,749			1,451
TOTAL			$	498,223		$	515,271
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
CURRENT LIABILITIES:
	Accounts payable		$	29,836		$	38,231
	Current portion of long-term debt			12,500
	Short term notes payable						7,500
	Accrued payroll and compensation			9,690			7,584
	Accrued interest payable			11,352			11,830
	Accrued and other liabilities			15,110			10,006
		Total current liabilities		78,488			75,151
LONG-TERM DEBT, less current portion				464,050			441,386
OTHER POSTRETIREMENT BENEFIT PLAN LIABILITY				16,615			15,734
OTHER LIABILITIES				1,424			1,234
DEFERRED INCOME TAXES							10,966
COMMITMENTS AND CONTINGENCIES (Notes 13 and 14)
STOCKHOLDERS' EQUITY (DEFICIENCY):
	Preferred stock, $.01 par value; 5,000 shares authorized and unissued Common stock and additional paid in capital, $.01 par value; 45,000 shares authorized, 24,923 shares issued; 24,796 and 24,837 outstanding in 2001 and 2000			24,939			24,939
	Treasury stock, 127 shares and 86 shares at cost in 2001 and 2000			(735	)		(505	)
	Stock subscriptions receivable			(638	)		(868	)
	Retained earnings (deficit)			(85,920	)		(52,766	)
		Total stockholders' equity (deficiency)		(62,354	)		(29,200	)
TOTAL			$	498,223		$	515,271

See notes to consolidated financial statements.

ACCURIDE CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(DOLLARS IN THOUSANDS)

		Years Ended December 31,
		2001			2000			1999
NET SALES		$	332,071		$	475,804		$	505,854
COST OF GOODS SOLD			295,737			393,232			390,776
GROSS PROFIT			36,334			82,572			115,078
OPERATING EXPENSES:
	Selling, general and administrative		33,538			32,849			33,493
INCOME FROM OPERATIONS			2,796			49,723			81,585
OTHER INCOME (EXPENSE):
	Interest income		1,362			1,824			798
	Interest expense		(41,561	)		(40,566	)		(39,786	)
	Equity in earnings of affiliates		250			455			2,316
	Other income (expense), net		(9,837	)		(6,157	)		(1,081	)
INCOME (LOSS) BEFORE INCOME TAXES, MINORITY
INTEREST AND EXTRAORDINARY GAIN			(46,990	)		5,279			43,832
INCOME TAX PROVISION (BENEFIT)			(13,836	)		4,361			18,410
MINORITY INTEREST									91
INCOME (LOSS) BEFORE EXTRAORDINARY GAIN			(33,154	)		918			25,331
EXTRAORDINARY GAIN, NET OF TAX						1,595
NET INCOME (LOSS)		$	(33,154	)	$	2,513		$	25,331

See notes to consolidated financial statements.

ACCURIDE CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)

(DOLLARS IN THOUSANDS)

		Comprehensive Income (Loss)			Common Stock and Additional Paid in Capital		Treasury Stock			Stock Subscriptions Receivable			Accumulated Other Comprehensive Income (Loss)			Retained Earnings (Deficit)			Total Stockholders' Equity (Deficiency)
BALANCE AT JANUARY 1, 1999					$	24,158				$	(1,644	)				$	(80,610	)	$	(58,096	)
Net income																	25,331			25,331
Issuance of shares						580					(580	)
Purchase of treasury stock							$	(51	)		10									(41	)
Proceeds from stock subscriptions receivable											675									675
BALANCE AT DECEMBER 31, 1999						24,738		(51	)		(1,539	)					(55,279	)		(32,131	)
Net income																	2,513			2,513
Issuance of shares						201					(201	)
Purchase of treasury stock								(454	)		160									(294	)
Proceeds from stock subscriptions receivable											712									712
BALANCE AT DECEMBER 31, 2000						24,939		(505	)		(868	)					(52,766	)		(29,200	)
Net loss		$	(33,154	)													(33,154	)		(33,154	)
Purchase of treasury stock								(230	)											(230	)
Proceeds from stock subscriptions receivable											230									230
Other comprehensive income (loss):
	Cumulative change in accounting (net of tax)		(189	)									$	(189	)					(189	)
	Realization of deferred amounts (net of tax)		189											189						189
Comprehensive income (loss)		$	(33,154	)
BALANCE AT DECEMBER 31, 2001					$	24,939	$	(735	)	$	(638	)	$			$	(85,920	)	$	(62,354	)

See notes to consolidated financial statements.

ACCURIDE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(DOLLARS IN THOUSANDS)

					Years Ended December 31,
					2001			2000			1999
CASH FLOWS FROM OPERATING ACTIVITIES:
	Net income (loss)				$	(33,154	)	$	2,513		$	25,331
	Adjustments to reconcile net income (loss) to net cash provided by operating activities:
		Depreciation				29,260			25,814			23,765
		Amortization				6,351			6,465			6,019
		Losses on disposal of assets				1,170			1,156			1,021
		Gain on early retirement of debt							(1,595	)
		Deferred income taxes				(14,941	)		789			12,947
		Equity in earnings of affiliated companies				(250	)		(454	)		(2,316	)
		Minority interest										91
		Changes in certain assets and liabilities (net of effects from purchase of AKW L.P.):
			Receivables			7,993			34,602			8,924
			Inventories and supplies			8,128			3,623			1,903
			Prepaid expenses and other assets			(2,605	)		2,068			(2,762	)
			Accounts payable			(8,395	)		(3,367	)		8,959
			Accrued and other liabilities			7,802			(5,271	)		2,953
				Net cash provided by operating activities		1,359			66,343			86,835
CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchases of property, plant and equipment					(17,705	)		(50,420	)		(44,507	)
	Capitalized interest					(700	)		(1,268	)		(1,565	)
	Payment for purchase of AdM											(7,422	)
	Payment for purchase of AKW L.P.											(71,095	)
	Net cash distribution from AKW L.P.											265
				Net cash used in investing activities		(18,405	)		(51,688	)		(124,324	)
CASH FLOWS FROM FINANCING ACTIVITIES:
	Proceeds from issuance of long-term debt											102,711
	Proceeds from issuance of short term notes payable											3,589
	Payments on long-term debt					(4,940	)		(19,050	)		(6,050	)
	Principal payments on short term notes payable					(7,500	)
	Net increase (decrease) in revolving credit advance					40,000			10,000			(33,000	)
	Deferred financing fees					(1,322	)					(1,373	)
	Redemption of shares					(230	)		(294	)		(41	)
	Proceeds from stock subscriptions receivable					230			712			675
				Net cash provided by (used in) financing activities		26,238			(8,632	)		66,511
	Increase in cash and cash equivalents					9,192			6,023			29,022
	Cash and cash equivalents, beginning of year					38,516			32,493			3,471
	Cash and cash equivalents, end of year				$	47,708		$	38,516		$	32,493

See notes to consolidated financial statements.

ACCURIDE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE YEARS IN THE PERIOD ENDED DECEMBER 31, 2001

(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Consolidation—The accompanying consolidated financial statements include the accounts of Accuride Corporation (the "Company") and its wholly-owned subsidiaries, including Accuride Canada, Inc. ("Accuride Canada"), AKW L.P. ("AKW"), and Accuride de Mexico, S.A. de C.V. ("AdM"). All significant intercompany transactions have been eliminated. Investments in affiliated companies in which the Company does not have a controlling interest are accounted for using the equity method.

Business of The Company—The Company is engaged primarily in the design, manufacture and distribution of wheels and rims for trucks, trailers and certain military and construction vehicles. The Company sells its products primarily within North America and Latin America to original equipment manufacturers and to the aftermarket. The Company's primary manufacturing facilities are located in Henderson, Kentucky; Columbia, Tennessee; Erie, Pennsylvania; Cuyahoga Falls, Ohio; London, Ontario, Canada and Monterrey, Mexico. The Company plans to close its Columbia, Tennessee, facility and consolidate the production of light wheels into its other facilities during 2002.

Management's Estimates and Assumptions—The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition—The Company records sales upon shipment and provides an allowance for estimated discounts associated with customer rebates.

Inventories—Inventories are stated at the lower of cost or market. Cost for substantially all inventories, except AdM, is determined by the last-in, first-out method (LIFO). AdM's inventories are stated at average cost.

Supplies—Supplies are stated at the lower of cost or market. Cost for substantially all supplies is determined by a moving-average method. The Company performs periodic evaluations of supplies and provides an allowance for obsolete items.

Property, Plant and Equipment—Property, plant and equipment are carried at cost. Expenditures for replacements and betterments are capitalized; maintenance and repairs are charged to operations as incurred.

        Buildings, machinery and equipment are depreciated using the straight-line method over estimated lives of 5 to 40 years. Tooling is generally depreciated over a 3-year life.

Deferred Financing Costs—Direct costs incurred in connection with the Recapitalization (see Note 2) and the Credit Agreement (see Note 9) have been deferred and are being amortized over the life of the related debt using the interest method.

Goodwill—Goodwill consists of costs in excess of the net assets acquired in connection with the Phelps Dodge Corporation ("PDC") acquisition of the Company in March 1988 and the AKW and AdM acquisitions in April 1999 and July 1999, respectively. Goodwill has been amortized using the straight-line method over 40 years.

Long-Lived Assets—The Company evaluates its long-lived assets to be held and used and its identifiable intangible assets for impairment when events or changes in economic circumstances indicate the carrying amount of such assets may not be recoverable. Long-lived assets to be disposed of are carried at the lower of cost or fair value less the costs of disposal.

Restructuring Reserve—Included in the Company's operating results for the year ended December 31, 2001, are restructuring charges of $2,700. These charges result from the Company's plans to close its Columbia, Tennessee, facility and consolidate the production of light wheels into its other facilities. The Company anticipates that these restructuring activities will be completed by the end of the third quarter of fiscal year 2002. As of December 31, 2001, there had been no disbursements made by the Company with respect to these charges and, consequently, the full $2,700 is included in "Accrued and Other Liabilities".

Pension Plans—The Company has trusteed, non-contributory pension plans covering substantially all U.S. and Canadian employees. For certain plans, the benefits are based on career average salary and years of service and, for other plans, a fixed amount for each year of service. The Company's funding policy provides that payments to the pension trusts shall be at least equal to the minimum legal funding requirements.

Postretirement Benefits Other Than Pensions—The Company has postretirement health care and life insurance benefit plans covering substantially all U.S. non-bargained and Canadian employees. The Company accounts for these benefits on an accrual basis and provides for the expected cost of such postretirement benefits accrued during the years employees render the necessary service. The Company's funding policy provides that payments to participants shall be at least equal to its cash basis obligation.

Postemployment Benefits Other Than Pensions—The Company has certain postemployment benefit plans covering certain U.S. and Canadian employees which provide severance, disability, supplemental health care, life insurance or other welfare benefits. The Company accounts for these benefits on an accrual basis. The Company's funding policy provides that payments to participants shall be at least equal to its cash basis obligation.

Income Taxes—Deferred tax assets and liabilities are computed based on differences between financial statement and income tax bases of assets and liabilities using enacted income tax rates. Deferred income tax expense or benefit is based on the change in deferred tax assets and liabilities from period to period, subject to an ongoing assessment of realization of deferred tax assets.

Research and Development Costs—Expenditures relating to the development of new products and processes, including significant improvements and refinements to existing products, are expensed as incurred. The amounts charged against income in 2001, 2000, and 1999 totaled $5,321, $6,264, and $5,176, respectively.

Foreign Currency—The assets and liabilities of Accuride Canada and AdM that are receivable or payable in cash are converted at current exchange rates, and inventories and other non-monetary assets and liabilities are converted at historical rates. Revenues and expenses are converted at average rates in effect for the period. Accuride Canada's and AdM's functional currencies have been determined to be the U.S. dollar. Accordingly, gains and losses resulting from conversion of such amounts, as well as gains and losses on foreign currency transactions, are included in operating results as "Other income (expense), net." The Company had aggregate foreign currency gains (losses) of $(822), $74, and $(5,544), for the years ended December 31, 2001, 2000, and 1999, respectively.

Concentrations of Credit Risk—Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash, cash equivalents, customer receivables, and derivative financial instruments. The Company places its cash and cash equivalents and

executes derivatives with high quality financial institutions. Generally, the Company does not require collateral or other security to support customer receivables.

Derivative Financial Instruments—The Company uses derivative instruments, which are not designated as hedging instruments, to manage exposures to foreign currency, commodity prices, and interest rate risks. The Company does not enter into derivative financial instruments for trading or speculative purposes. The derivative instruments used by the Company include interest rate, foreign exchange, and commodity price instruments. All derivative instruments are recognized on the balance sheet at their estimated fair value. See Note 16 for the carrying amounts and estimated fair values of these instruments.

Interest Rate Instruments—The Company uses interest rate swap agreements as a means of fixing the interest rate on portions of the Company's floating-rate debt. The interest rate swap is not designated as a hedge for financial reporting purposes and, accordingly, is carried in the financial statements at fair value, with unrealized gains or losses reflected in current period earnings as "Other income (expense), net". The settlement amounts from the swap agreement are reported in the financial statements as a component of interest. The Company uses interest rate cap agreements to set ceilings on the maximum interest rate the Company would incur on portions of the Company's floating-rate debt. The interest rate cap is carried in the financial statements at fair value, with unrealized gains or losses reflected in current period earnings as "Other income (expense), net". In the event that the cap is exercised, any realized gain would be recorded in the financial statements as a component of interest.

Foreign Exchange Instruments—The Company uses foreign currency forward contracts and options to limit foreign exchange risk on anticipated but not yet committed transactions expected to be denominated in Canadian dollars. The forward contracts are not designated as hedges for financial reporting purposes and, accordingly, are carried in the financial statements at fair value, with realized and unrealized gains or losses reflected in current period earnings as "Other income (expense), net." The total notional amount of outstanding forward contracts at December 31, 2001 and 2000 was $60,621 and $97,078, respectively.

Commodity Price Instruments—The Company uses commodity price swap contracts to limit exposure to changes in certain raw material prices. The commodity price instruments are not designated as hedges for financial reporting purposes and, accordingly, are carried in the financial statements at fair value, with realized and unrealized gains and losses reflected in current period earnings as "Other income (expense), net". Prior to the adoption of FAS 133 on January 1, 2001, aggregate realized gains were reflected in "Cost of goods sold". The total notional amount of outstanding commodity price swaps at December 31, 2001 and 2000 was $2,180 and $23,246, respectively.

        The realized and unrealized gain (loss) on the Company's derivative financial instruments as of December 31 are as follows:

	Interest Rate Instruments				Foreign Exchange Instruments				Commodity Price Instruments
	Realized gain (loss)		Unrealized gain (loss)		Realized gain (loss)		Unrealized gain (loss)		Realized gain (loss)		Unrealized gain (loss)
2001	(29	)	(3,360	)	(7,587	)	3,363		(1,919	)	(62	)
2000	547		—		(691	)	(6,621	)	1,477		—
1999	(660	)	—		2,565		2,194		193		—

Accounting Standards Adopted—Accounting standards adopted during 2001 include Statement of Financial Accounting Standards (SFAS) No. 133, Accounting for Derivative Instruments and Hedging Activities, and SFAS No. 141, Accounting for Business Combinations.

SFAS 133 established a comprehensive standard for the recognition and measurement of derivatives and hedging activities. The standard requires that all derivatives be recognized as assets or liabilities in the balance sheet and measured at fair value. Gains or losses resulting from changes in fair value are required to be recognized in current earnings unless specific hedge criteria are met. The adoption of SFAS 133 resulted in a net pre-tax reduction to other comprehensive income (OCI) of $300 ($189 after tax). The reduction in OCI was attributable to a net unrealized loss on cash flow hedges. During the year ended December 31, 2001, the $189 was reclassified into cost of goods sold as the related derivative instruments matured.

SFAS 141 established accounting and reporting standards for business combinations and prohibits the use of the pooling-of-interests method of accounting for those transactions after June 30, 2001. This Statement has had no effect on the Company's financial statements.

New Accounting Standards—New accounting standards which could impact the Company include SFAS No. 142, Accounting for Goodwill and Other Intangible Assets, and SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets".

SFAS 142 establishes accounting and reporting standards for goodwill and intangible assets. SFAS 142 will become effective for the Company on January 1, 2002. As of the date of adoption, the Company will no longer amortize goodwill, but will test for impairment on an annual basis. Management is still evaluating the full effect of this new accounting standard on the financial statements. As a result of the accounting change, $4,156 of goodwill amortization will not be included in 2002 operating expenses.

SFAS 144 is effective for the Company on January 1, 2002. The statement addresses financial accounting and reporting for the impairment of long-lived assets and for long-lived assets to be disposed. Management is still evaluating the full effect of this new accounting standard on the financial statements.

Reclassifications—Certain amounts from prior year's financial statement have been reclassified to conform to the current year presentation.

2. RECAPITALIZATION OF ACCURIDE CORPORATION

        The Company entered into a stock subscription and redemption agreement dated November 17, 1997 (the "Agreement" or "Redemption"), with PDC and Hubcap Acquisition L.L.C. ("Hubcap Acquisition"), a Delaware limited liability company formed at the direction of KKR 1996 Fund L.P., a Delaware limited partnership affiliated with Kohlberg Kravis Roberts & Co., L.P. ("KKR").

        Pursuant to the Agreement, effective January 21, 1998, Hubcap Acquisition acquired 90% of the common stock of the Company for an aggregate redemption price of $468,000 (the "Recapitalization"). In connection with the Recapitalization, Hubcap Acquisition made an equity investment in the Company of $108,000, and the Company issued $200,000 of 9.25% senior subordinated notes at 99.48% of principal value due 2008 and obtained $164,800 in bank borrowings, including $135,000 of borrowings under senior secured term loans due 2005 and 2006 with variable interest rates and $29,800 of borrowings under a $140,000 senior secured revolving line of credit expiring 2004 with a variable interest rate.

        Subsequent to the Recapitalization, effective September 30, 1998, PDC sold its remaining interest in the Company to an unrelated third party.

3. AKW AND AdM ACQUISITIONS

AKW Acquisition—AKW was formed in 1997 as a 50-50 joint venture between Kaiser and the Company to design, manufacture, and sell heavy-duty aluminum wheels. On April 1, 1999, the Company acquired Kaiser's 50% interest in AKW. Total aggregate cost was $71,095 including fees and

expenses. In connection with this acquisition, the fair value of assets acquired was $36,190 less liabilities assumed of $16,838. The cost exceeded the fair value of the net assets acquired by $51,743.

        The following unaudited pro forma financial data illustrates the estimated effects as if the AKW acquisition had been completed as of the beginning of the period presented, after including the impact of certain adjustments, such as goodwill amortization, depreciation, interest expense, the elimination of equity in earnings of affiliates arising from the Company's 50% interest in AKW owned prior to the acquisition, and the related income tax effects.

	Year Ended December 31, 1999
Net Sales	$	529,800
Net Income	$	25,632

        The pro forma results are not necessarily indicative of the actual results if the transactions had been in effect for the entire period presented. In addition, they are not intended to be a projection of future results and do not reflect, among other things, any synergies that might have been achieved from combined operations.

AdM Acquisition—AdM was formed on November 5, 1997 between the Company, Industria Automotriz, S.A. de C.V. ("IaSa"), and certain other parties to produce, market and sell steel wheels, rims, side rings, lock rings, mounting rings, spacer bands and related components. On July 16, 1999, the Company acquired IaSa's 49% interest in AdM. The acquisition gives the Company 100% control of AdM. Total aggregate cost was $7,400, including fees and expenses. The cost exceeded the fair value of the net assets acquired by $301.

        The AdM and AKW acquisitions have been accounted for by the purchase method of accounting. Under purchase accounting, the total purchase price has been allocated to the tangible and intangible assets and liabilities of AdM and AKW, respectively, based upon their respective fair values as of the dates of the acquisitions based upon valuations and other studies.

4. CONSOLIDATED STATEMENTS OF CASH FLOWS

        For the purpose of preparing the Consolidated Statements of Cash Flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Interest paid (net of amounts capitalized of $700, $1,268 and $1,565) for the years ended December 31, 2001, 2000 and 1999 was $40,572, $39,454 and $37,029, respectively. Income taxes paid for the years ended December 31, 2001, 2000 and 1999 were $1,682, $2,129 and $8,114, respectively.

5. INVENTORIES

        Inventories at December 31 were as follows:

		2001			2000
Raw materials		$	5,181		$	7,650
Work in process			9,223			11,163
Finished manufactured goods			15,157			17,731
LIFO adjustment			(454	)		940
	Total inventories	$	29,107		$	37,484

        During 2001 and 2000, certain inventory quantities were reduced, which resulted in liquidations of LIFO inventory layers carried at lower costs which prevailed in prior years. The effect of the liquidation was to decrease cost of goods sold by $382, $178 and $193 and to increase net income by $241, $112 and $112 for the years ended December 31, 2001, 2000 and 1999, respectively.

6. PROPERTY, PLANT AND EQUIPMENT

        Property, plant and equipment at December 31 consist of the following:

		2001		2000
Land and land improvements		$	7,006	$	7,016
Buildings			62,389		61,090
Machinery and equipment			381,319		366,679
			450,714		434,785
Less accumulated depreciation			225,200		197,375
	Property, plant and equipment, net	$	225,514	$	237,410

        During 2001, the Company evaluated its assets and determined $2,700 of equipment at its Monterrey, Mexico, facility to be impaired. This amount is included in cost of goods sold for the year ended December 31, 2001.

7. INVESTMENTS IN AFFILIATES

        Included in "Equity in earnings of affiliates" is the Company's 50% interest in the earnings of AOT, Inc. ("AOT"), and from January 1, 1999 through March 31, 1999, a 50% interest in the earnings of AKW. The following summarizes the Company's investments in affiliates.

AOT—AOT is a joint venture between the Company and The Goodyear Tire & Rubber Company formed to provide sequenced wheel and tire assemblies for Navistar International Transportation Corporation. The Company's investment in AOT at December 31, 2001 and 2000 totaled $3,439 and $3,189, respectively.

        In accordance with the agreement between the Company and The Goodyear Tire & Rubber Company, the Company has guaranteed fifty percent of AOT's outstanding bank debt. At December 31, 2001 and 2000, the amount of debt guaranteed by the Company totaled $2,650 and $2,950, respectively.

        As of December 31, 1999, the Company had one note receivable from AOT included in "Other assets" in the amount of $282, with an interest rate of 9.25%. Interest income earned on this note receivable for 2001, 2000 and 1999 totaled $0, $34, and $92, respectively.

AKW L.P.—On May 1, 1997, the Company entered into a joint venture with Kaiser for the formation of AKW and accounted for the investment using the equity method. The Company performed all billing and collection functions, as well as calculation and notification of rebates, for AKW. Fees associated with those agreements totaled $63 for the year ended December 31, 1999 and is reported as a reduction in "Selling, general and administrative expenses".

        On April 1, 1999 the Company acquired Kaiser's 50% interest in AKW (see Note 3).

8. SHORT-TERM NOTES PAYABLE

        Effective July 9, 1998, AdM entered into a $32,500 amended credit agreement consisting of a $7,500 working capital facility and a $25,000 term facility (see Note 9) which was guaranteed by the Company. At December 31, 2000, the interest rate on the working capital facility was comprised of the Eurodollar rate of 6.875% plus the Applicable Margin of 1.625%. In June 2001 the $7,500 working capital advance was repaid and the working capital facility was terminated. At December 31, 2000, the Company had $7,500 of short-term notes payable outstanding under the working capital facility.

9. LONG-TERM DEBT

        Long-term debt at December 31 consists of the following:

	2001		2000
Revolving Credit Advance	$	50,000	$	10,000
Term A Advance		55,404		57,600
Term B Advance		69,256		72,000
Term C Advance		97,000		97,000
Senior subordinated notes, net of $635 and $739 unamortized discount		189,265		189,161
AdM Term Advance		15,625		15,625
		476,550		441,386
Less current maturities (AdM Term Advance)		12,500
Total	$	464,050	$	441,386

Bank Borrowings—The Revolving Credit, Term A, Term B and Term C Advances were issued pursuant to the second amended and restated credit agreement ("Credit Agreement") dated as of July 27, 2001. The Revolving Credit, Term B and Term C Advances were borrowed by the U.S. Borrower and the Term A Advance was borrowed by Accuride Canada ("Canadian Borrower").

        The Credit Agreement consists of: (i) a $55,404 Term A Advance; (ii) a $69,256 Term B Advance; (iii) a $97,000 Term C Advance; and (iv) up to $100,000 under the revolving credit facility (which may be limited to $87,500 based on certain leverage ratios) and trade letters of credit and standby letters of credit up to an aggregate sub-limit of $20,000. Letters of credit of $855 and $540 were outstanding at December 31, 2001 and 2000. Swing line advances may be made up to the lesser of: (1) $10,000; or (2) the aggregate unused revolving credit commitment from time to time. The borrowings under the Revolving Credit, Term A, Term B and Term C Advances are collectively referred to as the "Bank Borrowings."

        The Company has the option to borrow under the Credit Agreement at the Base Rate or Eurodollar Rate plus an Applicable Margin, as defined in the Credit Agreement. The Applicable Margin shall be adjusted upon the Company achieving certain leverage ratios and varies by type of borrowing. At December 31, 2001, the Company had $15,000 outstanding on the revolving credit facility under the Base Rate option of 4.75% plus the Applicable Margin of 2.25% and $35,000 outstanding on the revolving credit facility under the Eurodollar Rate option. The corresponding Eurodollar Rate ranged from 2.13%—2.56% and the Applicable Margin was 3.25%. At December 31, 2000, the Company had $10,000 outstanding under the revolving credit facility and the corresponding Eurodollar Rate was 6.56% and the Applicable Margin was 1.38%.

        The Company's other Bank Borrowings at December 31, 2001 and 2000 were all borrowed under the Eurodollar Rate option. At December 31, 2001 the corresponding Eurodollar Rates ranged from 3.75%—5.44%, and the Applicable Margin ranged from 3.25%—4.00%. At December 31, 2000 the corresponding Eurodollar Rate was 6.81% and the Applicable Margin ranged from 1.25% to 2.25%.

        Bank Borrowings and any unpaid interest thereon under; (i) the Term A Advance shall be repayable on January 21, 2005 in the amount equal to the then outstanding principal balance of the Term A Advance; (ii) the Term B Advance shall be repayable on January 21, 2006 in the amount of the then outstanding principal balance of the Term B Advance; (iii) the Term C Advance shall be repayable in installments of $1,000 each on January 21, 2003, January 21, 2004, and January 21, 2005, and an installment of $47,000 on January 21, 2006 and on January 21, 2007 in the amount of the then outstanding principal balance of the Term C Advance; and (iv) the revolving credit facility shall be payable in full on January 21, 2004. In May 2001, the Company prepaid $2,196 for the Term A

Advance and $2,744 for the Term B Advance. In April 2000, the Company prepaid $600 for the Term A Advance, $750 for the Term B Advance, and $1,000 for the Term C Advance.

        The Bank Borrowings are guaranteed by all domestic subsidiaries of the U.S. Borrower. The Term A Advance is guaranteed by the U.S. Borrower. The Bank Borrowings are collateralized by a valid and perfected first priority interest in 100% of the common stock of each first tier domestic subsidiary of the U.S. Borrower and of the Canadian Borrower, and 66% of all of the U.S. Borrower's current and future first tier foreign subsidiaries other than the Canadian Borrower. In addition, the Bank Borrowing are supported by first priority liens on all unencumbered real, personal, tangible and intangible property of the Borrowers. A negative pledge restricts the imposition of other liens or encumbrances on all of the assets of the Borrowers and their subsidiaries, subject to certain exceptions.

Senior Subordinated Notes—Interest at 9.25% on the senior subordinated notes (the "Notes") is payable on February 1 and August 1 of each year, commencing on August 1, 1998. The Notes mature in full on February 1, 2008 and may be redeemed, at the option of the Company, in whole or in part, at any time on or after February 1, 2003 in cash at the redemption prices set forth in the indenture, plus interest. In addition, at any time prior to February 1, 2002 the Company may redeem up to 40% of the original aggregate principal amount of the Notes with the net proceeds of one or more Equity Offerings, as defined. The Notes are a general unsecured obligation of the Company ranking senior in right of payment to all existing and future subordinated indebtedness of the Company. The Notes are subordinated to all existing and future senior indebtedness of the Company including indebtedness incurred under the Credit Agreement. In 2000, the Company elected to repurchase at market prices $10,100 in principal amount of Notes. The debt retirement resulted in an extraordinary gain of $2,512, net of $917 in tax expense. As of December 31, 2001 and 2000 the aggregate principal amount of Notes outstanding was $189,900.

AdM Term Facility—At December 31, 2001 and December 31, 2000, AdM had term notes outstanding of $15,625 under its $25,000 term facility (see Note 8). Principal is payable quarterly from June 25, 2001 through March 25, 2003. At December 31, 2001, the interest rate on the term note was based on a Eurodollar rate of 2.15% plus the Applicable Margin of 3.50%. At December 31, 2000, the interest rate on the term note was based on the Eurodollar rate of 6.88% plus the Applicable Margin of 1.50%. AdM's total assets have been assigned as collateral under the terms of the credit agreement. In August 2000, AdM prepaid the principal installments due June 25, 2001, September 25, 2001 and December 25, 2001. The total amount of principal prepaid was $9,375.

        Under the terms of the Company's credit agreement and AdM's credit agreement, there are certain restrictive covenants that limit the payment of cash dividends and establish minimum financial ratios.

Interest Rate Instruments—At December 31, 2001, the Company was a party to a 2.73% interest rate cap agreement expiring in January 2003. The agreement entitles the Company to receive from the counterparty on a quarterly basis the amount, if any, by which the Company's interest payments on $120,000 of floating-rate long-term debt exceed 2.73% plus the Applicable Margin. As of December 31, 2001 the interest rate cap had a notional amount of $120,000. At December 31, 2000, the Company was a party to a 7.5% interest rate cap agreement expiring in January 2001. The agreement entitles the Company to receive from the counterparty on a quarterly basis the amount, if any, by which the Company's interest payments on $34,300 of floating-rate long-term debt exceed 7.5% plus the Applicable Margin. As of December 31, 2000 the interest rate cap had a notional amount of $34,300.

        The Company uses interest rate swap agreements to manage its interest rate exposure on portions of its floating-rate debt obligations. Under the interest rate swap agreement in effect as of December 31, 2001, the Company makes fixed rate payments at 4.78% and receives variable rate payments at the three-month Eurodollar rate. As of December 31, 2001 the interest rate swap agreement had a notional amount of $100,000, and the corresponding Eurodollar rate was 2.37%. The

maturity date of the interest rate swap agreement is July 2003. Under the interest rate swap agreement in effect as of December 31, 2000, the Company made fixed rate payments at 5.75% and received variable rate payments at the three-month Eurodollar rate. As of December 31, 2000 the interest rate swap agreement had a notional amount of $98,000, and the corresponding Eurodollar rate was 6.76%. The maturity date of the interest rate swap agreement was January 2001.

        The Company is exposed to credit losses in the event of nonperformance by the counterparties to its interest rate caps and interest rate swaps. The Company anticipates, however, that each counterparty will be able to fully satisfy the obligations under the contracts. The Company does not obtain collateral or other security to support financial instruments subject to credit risk but monitors the credit standing of each counterparty.

        Maturities of long-term debt, including the bond discount, based on minimum scheduled payments as of December 31, 2001, are as follows:

2002		$	12,500
2003			4,125
2004			51,000
2005			56,404
2006			116,256
Thereafter			236,900
	Total	$	477,185

10. PENSION PLANS AND OTHER POSTRETIREMENT BENEFIT PLANS

        The Company sponsors non-contributory employee defined benefit pension plans covering substantially all U.S. and Canadian employees (the "plans"). Employees covered under the U.S. salaried plan are eligible to participate upon the completion of one year of service and benefits are determined by their cash balance accounts, which are based on an allocation they earn each year. Employees covered under the Canadian salaried plan are eligible to participate upon the completion of two years of service and benefits are based upon career average salary and years of service. Employees covered under the hourly plans are generally eligible to participate at the time of employment and benefits are generally based on a fixed amount for each year of service. U.S. employees are vested in the plans after five years of service; Canadian hourly employees are vested after two years of service.

        In addition to providing pension benefits, the Company also provides certain unfunded health care and life insurance programs for U.S. non-bargained and Canadian employees who meet certain eligibility requirements. These benefits are provided through contracts with insurance companies and health service providers. The coverage is provided on a non-contributory basis for certain groups of employees and on a contributory basis for other groups. The majority of these benefits are paid by the Company.

        The components of pension and postretirement benefit cost included the following components:

		Pension Benefits									Other Benefits
		2001			2000			1999			2001			2000			1999
Service cost-benefits earned during the year		$	2,965		$	2,649		$	2,339		$	602		$	562		$	528
Interest cost on projected benefit obligation			2,957			2,719			2,232			1,106			991			839
Expected return on plan assets			(4,410	)		(3,740	)		(3,350	)
Prior service cost and other amortization (net)			313			300			488			(208	)		(224	)		(162	)
	Net amount charged to income	$	1,825		$	1,928		$	1,709		$	1,500		$	1,329		$	1,205

        For 2001 measurement purposes, annual rates of increase in the per capita cost of covered health care benefits were assumed to average 10% for 2002 decreasing gradually to 5.5% by 2008 and remaining at that level thereafter, for U.S. plans. The annual rates of increase in the per capita cost of covered health care benefits for Canadian plans were assumed to average 11% for 2002 decreasing 1% per annum to 5% and remaining at that level thereafter. The health care cost trend rate assumption has a significant effect on the amounts reported. A one-percentage point change in assumed health care cost trend rates would have the following effects:

	1-Percentage- Point Increase		1-Percentage- Point Decrease
Effect on total of service and interest cost components	$	315	$	(264	)
Effect on postretirement benefit obligation		2,472		(2,174	)

        Assumptions used to develop the net periodic pension cost and other postretirement benefit cost and to value pension obligations as of December 31 were as follows:

	Pension Benefits				Other Benefits
	2001		2000		2001		2000
Discount rate	7.00	%	7.75	%	7.00	%	7.75	%
Rate of increase in future compensation levels	4.0	%*	4.00	%	4.0	%*	4.00	%
Expected long-term rate of return on assets	9.0	%**	9.5	%**	N/A		N/A

*

A 3.5% increase in future compensation assumption was used for the Canadian plans.

**

A 10.0% return on assets assumption was used for the Canadian plans.

        The following table sets forth the change in benefit obligation, change in plan assets, funded status of the pension plan, and net asset (liability) recognized in the Company's balance sheet at December 31, 2001 and 2000:

		Pension Benefits						Other Benefits
		2001			2000			2001			2000
Change in benefit obligation:
	Benefit obligation at beginning of year	$	40,862		$	35,582		$	15,582		$	14,600
	Service cost		2,965			2,649			602			562
	Interest cost		2,957			2,719			1,106			991
	Amendments								321
	Actuarial loss (gain)		2,649			2,316			1,723			(56	)
	Currency translation adjustment		(1,600	)		(958	)		(310	)		(186	)
	Benefits paid		(2,042	)		(1,446	)		(356	)		(329	)
	Benefit obligation at end of year		45,791			40,862			18,668			15,582
Change in plan assets:
	Fair value of assets at beginning of year		43,935			37,798
	Actual return on plan assets		(377	)		3,833
	Employer contribution		4,454			4,804
	Currency translation adjustment		(1,808	)		(1,054	)
	Benefits paid		(2,042	)		(1,446	)
	Fair value of assets at end of year		44,162			43,935
	Funded status		(1,629	)		3,073			(18,668	)		(15,582	)
	Unrecognized actuarial loss		10,586			3,626			3,859			2,225
	Unrecognized prior service cost (benefit)		2,316			2,658			(1,806	)		(2,377	)
	Unrecognized net obligation		285			321
	Accrued benefit asset (cost)	$	11,558		$	9,678		$	(16,615	)	$	(15,734	)

        The pension plans were valued as of December 31 (December 1 for Accuride Union Plan) for both 2001 and 2000. The obligations were projected to and the assets were valued as of the end of 2001 and 2000. The plan assets are invested in a diversified portfolio of stocks, bonds and cash or cash equivalents.

        The projected benefit obligation, accumulated benefit obligation, and fair value of plan assets for the pension plans with accumulated benefit obligations in excess of plan assets were $18,654, $17,659 and $13,469, respectively, as of December 31, 2001 and $4,317, $4,100 and $3,019, respectively, as of December 31, 2000.

        The Company intends to fund at least the minimum amount required under the Employee Retirement Income Security Act of 1974, as amended, for U.S. plans, or in the case of Accuride Canada, the minimum legal requirements in Canada.

        The Company also provides a 401(k) savings plan and a profit sharing plan for substantially all U.S. salaried employees. Select employees may also participate in a supplemental savings plan. Expense associated with these plans for the years ended December 31, 2001, 2000 and 1999 totaled $1,108, $1,755, and $1,183, respectively.

11. INCOME TAXES

        The income tax provision (benefit) from continuing operations before extraordinary item for the years ended December 31 is as follows:

			2001			2000			1999
Current:
	Federal		$	0		$	367		$	523
	State			415			845			981
	Foreign			689			2,549			3,959
				1,104			3,761			5,463
Deferred:
	Federal			(13,745	)		4,645			15,429
	State			(2,455	)		(375	)		(2,691	)
	Foreign			(1,712	)		(3,670	)		2,342
	Valuation allowance			2,972						(2,133	)
				(14,940	)		600			12,947
		Total	$	(13,836	)	$	4,361		$	18,410

        A reconciliation of the U.S. statutory tax rate to the Company's effective tax rate for the years ended December 31, is as follows:

		2001		2000		1999
Statutory tax rate		35.0	%	35.0	%	35.0	%
Withholding tax on dividend of foreign subsidiary						0.3
State and local income taxes		5.3		2.6		2.2
Incremental international tax		2.8		18.7		8.5
Goodwill		(2.0	)	17.0		2.1
Change in state tax rates		(0.6	)			(4.1	)
Change in valuation allowance		(6.3	)			(4.9	)
Other items, net		(4.7	)	9.3		2.9
	Effective tax rate	29.5	%	82.6	%	42.0	%

        Deferred income tax assets and liabilities comprised the following at December 31:

			2001			2000
Deferred tax assets:
	Depreciation and amortization		$	10,173		$	11,524
	Postretirement and postemployment benefits			5,611			5,073
	Other			8,333			6,038
	Foreign tax credit			736
	Alternative minimum tax credit			1,018			1,879
	Loss carryforwards			31,209			9,392
	Valuation allowance			(2,972	)
		Total deferred tax assets		54,108			33,906
Deferred tax liabilities:
	Asset basis and depreciation			28,161			28,812
	Pension costs			4,006			3,641
	Inventories			1,880			677
	Withholding tax on dividend of foreign subsidiary						128
	Other			10,912			6,439
		Total deferred tax liabilities		44,959			39,697
Net deferred tax assets (liabilities)				9,149			(5,791	)
	Current deferred tax asset			6,219			5,175
Long-term deferred income tax asset (liability)-net			$	2,930		$	(10,966	)

        The Company's net operating loss, capital loss and tax credit carryforwards available in various tax jurisdictions at December 31, 2001 expire in periods ranging from five to twenty years, except that the alternative minimum tax credit and capital loss do not expire. Realization of deferred tax assets is dependent upon taxable income within the carryforward periods available under the applicable tax laws. Although realization of deferred tax assets in excess of deferred tax liabilities is not certain, management has concluded that it is more likely than not the Company will realize the full benefit of deferred tax assets, except for a valuation allowance related to loss carryforwards and for foreign tax credits.

        The Company does not intend to permanently reinvest the undistributed earnings of Accuride Canada. However, no provision for U.S. income taxes has been made because, in management's opinion, such earnings will be remitted as dividends with taxes substantially offset by foreign tax credits.

        At December 31, 2001, AdM had no cumulative retained earnings for distribution. The Company previously treated undistributed earnings as permanently reinvested. Accordingly, no provision for U.S. income taxes has ever been made for such earnings.

12. STOCK PURCHASE AND OPTION PLAN

        Effective January 21, 1998, the Company adopted the 1998 Stock Purchase and Option Plan for key employees of Accuride Corporation and subsidiaries (the "1998 Plan").

        The 1998 Plan provides for the issuance of shares of authorized but unissued or reacquired shares of common stock subject to adjustment to reflect certain events such as stock dividends, stock splits, recapitalizations, mergers or reorganizations of or by the Company. The 1998 Plan is intended to assist the Company in attracting and retaining employees of outstanding ability and to promote the identification of their interests with those of the stockholders of the Company. The 1998 Plan permits the issuance of common stock (the "1998 Plan-Purchase Stock") and the grant of non-qualified stock

options (the "1998 Plan-Options") to purchase shares of common stock (the issuance of 1998 Plan Purchase Stock and the grant of the 1998 Plan Options pursuant to the 1998 Plan being a "1998 Plan Grant"). Unless sooner terminated by the Company's Board of Directors, the 1998 Plan will expire ten years after adoption. Such termination will not affect the validity of any 1998 Plan Grant outstanding on the date of the termination.

        Pursuant to the 1998 Plan, 2,667 shares of common stock of the Company are reserved for issuance under such plan.

1998 Plan-Purchase Stock—At December 31, 2001, the Company had issued 922 shares of common stock under the 1998 Plan Purchase Stock totaling $4,621 under the terms of stock subscription agreements with various management personnel of the Company. During 2001 and 2000, respectively, 41 shares and 76 shares were repurchased as treasury stock at a cost of $230 and $454. The unpaid principal balance of $638 under the stock subscription agreements has been recorded as a reduction of stockholders' equity.

1998 Plan-Options—The following is an analysis of stock option activity pursuant to the 1998 Plan for each of the last two years ended December 31 and the stock options outstanding at the end of the respective year:

	Year ended December 31,
	2001				2000
	Options		Weighted Average Price		Options		Weighted Average Price
Outstanding, beginning of year	1,648		$	5,014	1,669		$	5,000
Granted					95		$	5,250
Cancelled	(309	)	$	5,000
Forfeited or expired	(110	)	$	5,006	(116	)	$	5,000
Outstanding at end of year	1,229		$	5,017	1,648		$	5,014
Options exercisable at end of year	952		$	5,012	865		$	5,010

        Time options vest in equal installments over a five-year period from the date of the grant. Performance options vest after approximately eight years or vest at an accelerated rate if the Company meets certain performance objectives. As of December 31, 2001, options outstanding have an exercise price ranging between $5,000 and $5,250 per share and a weighted average remaining contractual life of 6.8 years.

        In 2001, the Company offered eligible employees the opportunity to exchange performance options with an exercise price of $5,000 per share or more that were scheduled to vest in 2001 and 2002 for new options which the Company intends to grant in 2002 under the 1998 Plan. The new options will vest over a period of four years and will have an exercise price equal to the fair value at the date of grant. On October 4, 2001, 309.4 options were tendered by the employees and were accepted for exchange and cancelled by Accuride.

        The Company applies APB Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations in accounting for the plans; accordingly, since the grant price of the stock options was at least 100% of the fair value at the date of the grant, no compensation expense has been recognized by the Company in connection with the option grants. Had compensation cost for the plans been determined based on the fair value at the grant dates for awards under the plan consistent with the fair value method of SFAS No. 123, Accounting for Stock-Based Compensation, the Company's net income for the years ended December 31, 2000 and 1999 would have decreased from $2,513 and $25,331 to the pro forma amounts of $2,496 and $25,284, respectively.

        The weighted average fair value of options granted in 2000 was $3,745. The fair value of the option grants is estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: dividend yield equaling 0%, risk-free interest rates ranging from 4.90%-6.60%, expected volatilities assumed to be 0% and expected lives of approximately 7 years. The pro forma amounts are not representative of the effects on reported net income for future years.

13. COMMITMENTS

        The Company leases certain plant, office space and equipment for varying periods. Management expects that in the normal course of business, leases will be renewed or replaced by other leases.

        Rent expense for the years ended December 31, 2001, 2000 and 1999 was $2,372, $3,072 and $2,371, respectively. Future minimum lease payments for all noncancelable operating leases having a remaining term in excess of one year at December 31, 2001 are as follows:

2002		$	2,030
2003			1,473
2004			883
2005			858
2006			849
Thereafter			2,421
	Total	$	8,514

14. CONTINGENCIES

        The Company is from time to time involved in various legal proceedings of a character normally incident to its business. Management does not believe that the outcome of these proceedings will have a material adverse effect on the consolidated financial condition or results of operations of the Company.

        The Company's operations are subject to federal, state and local environmental laws, rules and regulations. Pursuant to the Recapitalization of the Company (see Note 2), the Company has been indemnified by PDC with respect to certain environmental liabilities at its Henderson and London facilities, subject to certain limitations. Pursuant to the AKW acquisition agreement (see Note 3), the Company has been indemnified by Kaiser with respect to certain environmental liabilities relating to the facilities leased by AKW. Management does not believe that the outcome of any environmental proceedings will have a material adverse effect on the consolidated financial condition or results of operations of the Company.

15. SEGMENT REPORTING

        The Company operates in one business segment: the design, manufacture and distribution of wheels and rims for trucks, trailers, and other vehicles.

Geographic Segments—The Company has operations in the United States, Canada, and Mexico which are summarized below.

2001			United States		Canada		Mexico		Eliminations			Combined
Net sales:
	Sales to unaffiliated customers—domestic		$	258,754	$	10,532	$	35,337				$	304,623
	Sales to unaffiliated customers—export			21,983				5,465					27,448
		Total	$	280,737	$	10,532	$	40,802				$	332,071
Long-lived assets			$	378,184	$	108,191	$	40,995	$	(153,137	)	$	374,233

2000			United States		Canada		Mexico		Eliminations			Combined
Net sales:
	Sales to unaffiliated customers—domestic		$	398,369	$	11,826	$	31,499				$	441,694
	Sales to unaffiliated customers—export			29,853				4,257					34,110
		Total	$	428,222	$	11,826	$	35,756				$	475,804
Long-lived assets			$	383,060	$	104,475	$	46,113	$	(145,021	)	$	388,627

1999			United States		Canada		Mexico		Eliminations			Combined
Net sales:
	Sales to unaffiliated customers—domestic		$	430,722	$	14,940	$	20,604				$	466,266
	Sales to unaffiliated customers—export			30,331				9,257					39,588
		Total	$	461,053	$	14,940	$	29,861				$	505,854
Long-lived assets			$	337,621	$	96,696	$	48,413	$	(112,864	)	$	369,866

        Sales to three customers exceed 10% of total net sales for the years ended December 31, as follows:

	2001				2000				1999
	Amount		% of Sales		Amount		% of Sales		Amount		% of Sales
Customer one	$	70,830	21.3	%	$	96,518	20.3	%	$	93,568	18.5	%
Customer two		41,073	12.4	%		71,604	15.1	%		86,327	17.1	%
Customer three		40,171	12.1	%		58,488	12.3	%		65,955	13.0	%
	$	152,074	45.8	%	$	226,610	47.7	%	$	245,850	48.6	%

        Each geographic segment made sales to all three major customers in 2001.

16. FINANCIAL INSTRUMENTS

        The estimated fair value amounts of financial instruments have been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have an effect on the estimated fair value amounts.

        The carrying amounts of cash and cash equivalents, trade receivables, other current assets, and accounts payable approximate fair value because of the relatively short maturity of these instruments. The carrying amounts and related estimated fair values for the Company's remaining financial instruments are as follows:

	December 31, 2001				December 31, 2000
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Assets
Interest Rate Cap	$	292	$	292
Interest Rate Swap					$	0	$	250
Liabilities
Interest Rate Swap	$	3,232	$	3,232
Foreign Exchange Forward Contracts	$	913	$	913	$	4,276	$	4,276
Commodity Price Contracts	$	612	$	612	$	0	$	882
Total Debt	$	476,550	$	353,792	$	448,886	$	390,756

        Fair values relating to derivative financial instruments reflect the estimated amounts that the Company would receive or pay to terminate the contracts at the reporting date based on quoted market prices of comparable contracts as of December 31.

        The fair value of the Company's long-term debt has been determined on the basis of the specific securities issued and outstanding. All of the Company's long-term debt is at variable rates at December 31, 2001 and 2000 except for the senior subordinated notes which have a fixed interest rate of 9.25% (see Note 9).

17. LABOR RELATIONS

        The Company's prior contract with the United Auto Workers ("UAW") covering employees at the Henderson Facility expired in February 1998, and the Company was not able to negotiate a mutually acceptable agreement with the UAW. As a result, a strike occurred at the Henderson Facility on February 20, 1998. On March 31, 1998, the Company began an indefinite lock-out. On January 27, 2002, the UAW rejected the Company's most recent contract proposal. The Company is continuing to operate with its salaried employees and contractors. Currently, there is, and the Company believes that there will be, no supply disruption to the Company's customer base; however, there can be no assurance to that effect.

18. RELATED PARTY TRANSACTIONS

        Effective January 21, 1998, the Company and KKR entered into a management agreement providing for the performance by KKR of certain management, consulting and financial services for the Company. The Company expensed approximately $600 in each of the three years ended December 31, 2001, pursuant to such management agreement.

19. QUARTERLY DATA (Unaudited)

        The following table sets forth certain quarterly income statement information of the Company for the fiscal years ended December 31, 2001, 2000 and 1999:

	2001
	Q1			Q2			Q3			Q4			Total
	(Dollars in Thousands)
Net sales	$	90,931		$	92,056		$	77,714		$	71,370		$	332,071
Gross profit		8,946			11,907			9,779			5,702			36,334
Operating expenses		7,257			10,220			7,706			8,355			33,538
Income (loss) from operations		1,689			1,687			2,073			(2,653	)		2,796
Equity earnings of affiliates (1)		120			70			28			32			250
Other expense (2)		(13,028	)		(6,765	)		(17,756	)		(12,487	)		(50,036	)
Net loss		(7,194	)		(4,951	)		(10,305	)		(10,704	)		(33,154	)

	2000
	Q1			Q2			Q3			Q4			Total
	(Dollars in Thousands)
Net sales	$	143,368		$	136,956		$	104,403		$	91,077		$	475,804
Gross profit		31,742			27,580			17,189			6,061			82,572
Operating expenses		8,400			9,915			6,435			8,099			32,849
Income (loss) from operations		23,342			17,665			10,754			(2,038	)		49,723
Equity earnings of affiliates (1)		126			113			118			98			455
Other expense (2)		(10,776	)		(12,770	)		(12,920	)		(8,433	)		(44,899	)
Income (loss) before extraordinary gain		7,361			2,906			(1,189	)		(8,160	)		918
Net income (loss)		7,361			2,906			(1,189	)		(6,565	)		2,513

	1999
	Q1			Q2			Q3			Q4			Total
	(Dollars in Thousands)
Net sales	$	111,533		$	136,052		$	129,422		$	128,847		$	505,854
Gross profit		26,092			31,226			28,702			29,058			115,078
Operating expenses		6,479			7,695			7,608			11,711			33,493
Income from operations		19,613			23,531			21,094			17,347			81,585
Equity earnings (loss) of affiliates (1)		2,315			11			32			(42	)		2,316
Other expense (2)		(9,259	)		(10,396	)		(10,659	)		(9,755	)		(40,069	)
Net income		7,324			7,557			6,071			4,379			25,331

(1)

AKW was accounted for on the equity method until April 1, 1999 when the Company acquired 100% ownership.

(2)

Included in other expense are interest income, interest expense, and other income (expense), net.

* * * * * *

Schedule II

Accuride Corporation
Valuation and Qualifying Accounts and Reserves

		Balance at Beginning of Period	Charges to Costs and Expenses	Recoveries	Write- offs		Balance at End of Period
Reserves deducted in balance sheet from the asset to which Applicable:
Accounts Receivable:
	December 31, 1999	1,008	61	21	(628	)	462
	December 31, 2000	462	293	79	(28	)	806
	December 31, 2001	806	1,035	275	(668	)	1,448

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.

Dated: March 11, 2002

ACCURIDE CORPORATION
By:	/s/  WILLIAM P. GREUBEL William P. Greubel President and Chief Executive Officer

        Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/  WILLIAM P. GREUBEL William P. Greubel	President and Chief Executive Officer (Principal Executive Officer, Director)	March 11, 2002
/s/  JOHN R. MURPHY John R. Murphy	Executive Vice President/Chief Financial Officer, Secretary and Chief Financial Officer (Principal Financial and Accounting Officer)	March 11, 2002
/s/  GEORGE R. ROBERTS George R. Roberts	Director	March 11, 2002
/s/  JAMES H. GREENE, JR. James H. Greene, Jr.	Director	March 11, 2002
/s/  FREDERICK M. GOLTZ Frederick M. Goltz	Director	March 11, 2002
Henry R. Kravis	Director
Todd A. Fisher	Director

EX-10.37

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November 20, 2001

Tier I Employee
Accuride Corporation
7140 Office Circle
Evansville, IN 47715

Change in Control Agreement

Dear Tier I Employee:

        Our Board of Directors believes that it is in the best interests of Accuride Corporation ("Accuride") and its shareholders to take appropriate steps to allay any concerns you may have about your future employment opportunities with Accuride and its subsidiaries (Accuride and its subsidiaries are collectively referred to as the "Company"). As a result, the Board has decided to offer to you the special package of benefits described below.

        Please bear in mind that these benefits are being offered only to a few selected employees and we accordingly ask that you refrain from discussing this special program with others. Also, please note that the special benefits package described below will only be effective if you sign the extra copy of this Change in Control Agreement (the "Agreement") which is enclosed and return it to me on or before December 15, 2001. This Agreement supersedes any other change in control agreements entered into previously by you and the Company, whether written or oral.

1.

TERM OF AGREEMENT.

        This Agreement is effective immediately and will continue in effect for an approximate three-year term, ending on December 31, 2004 (the "Initial Term"). This Agreement will be automatically renewed at the end of the Initial Term for additional terms commencing on each January 1, and ending on the next following December 31 (a "Renewal Term"), unless either party serves notice of desire to terminate or modify this Agreement on the other. Such notice must comply with Section 13 and be given at least six months before the end of the Initial Term or the applicable Renewal Term. If a Change in Control or a Partial Change in Control occurs during the Initial Term or any Renewal Term, the scheduled expiration date of the Initial Term or Renewal Term, as the case may be, shall be extended for a term ending on the 18-month anniversary of the Change in Control or Partial Change in Control. Termination of this Agreement will not reduce or diminish any liabilities that have accrued prior to termination.

2.

SEVERANCE PAYMENT.

        If your employment with the Company is terminated without "Cause" (as defined in Section 8) within 18 months following a Change in Control or Partial Change in Control, you will receive the "Severance Payment" described below. The Severance Payment also will be payable if you terminate your employment for "Good Reason" (as defined in Section 7) within 18 months following a Change in Control or Partial Change in Control.

        The "Severance Payment" is a lump sum payment equal to the sum of: (a) 300% of your annualized base salary as of the date on which a Change in Control or Partial Change in Control occurs, plus (b) 300% of any bonus or incentive compensation paid or payable to you pursuant to the Company's Incentive Compensation Program, determined as the greater of the following: (i) the incentive compensation to which you would have been entitled if the year were to end on the day on which the Change in Control or Partial Change in Control occurs, based upon an annualized figure determined using performance up to that date; or (ii) the average of the actual incentive compensation paid to you through the Incentive Compensation Program during the three years preceding the year of your termination. The Severance Payment shall be reduced by the full amount of any payments to which you may be entitled due to your termination pursuant to any other Company severance policy, any agreement between you and the Company providing for severance, or applicable law.

        The Severance Payment will be paid in one lump sum within 10 days following your termination of employment.

        The Severance Payment will not be payable if your employment is terminated for Cause, if you terminate your employment without Good Reason, or if your employment is terminated by reason of your "Disability" (as defined in Section 10(d)) or your death. In addition, the Severance Payment will not be payable if your employment is terminated by you or the Company for any or no reason before a Change in Control or Partial Change in Control occurs or more than 18 months after a Change in Control or Partial Change in Control has occurred.

        In order to receive the Severance Payment, you must execute a release of known or unknown claims that you may have against the Company. The release shall be in a form reasonably requested by Company.

        The Severance Payment will be payable without regard to whether you look for or obtain alternative employment following your termination of employment with the Company.

3.

ACCELERATION OF OR PAYMENT FOR OPTIONS.

        If an agreement is entered into that will result in a Change in Control or Partial Change in Control, before the Change in Control or Partial Change in Control occurs the Compensation Committee of the Company's Board of Directors will accelerate the exercisability of any options you hold to acquire Company stock in accordance with the acceleration provisions of the 1998 Stock Purchase and Option Plan for Employees of Accuride Corporation and Subsidiaries.

4.

OTHER BENEFITS.

        (a)    In General.    If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company shall arrange to provide you, for an 18-month period, with disability, accident, dental and group health insurance benefits substantially similar to those which you were receiving immediately prior to your termination. The cost to you of a particular type of benefit (e.g., dental insurance) shall be not more than the cost to you of that particular benefit immediately prior to your termination. The Company may provide the health insurance benefit described under this Section by paying a portion of the premiums you are required to pay for continued health insurance coverage under the Company's health insurance plan pursuant to COBRA. The amount paid by the Company will be equal to the difference between the total COBRA premium and the amount you were required to pay for health insurance immediately prior to your termination.

        Your right to receive continued health insurance benefits pursuant to COBRA shall commence upon the termination of your employment and shall not be extended by your rights under this Agreement.

        Your right to receive all forms of benefits described under this paragraph (a) shall terminate as soon as you become eligible to receive health care benefits, without exclusion for pre-existing conditions, from any other employer.

        (b)    Outplacement and Financial Planning Benefits.    If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company will provide you with (i) senior executive outplacement services; and (ii) a tax and financial planning services stipend in an amount equal to the amount you received in the year prior to the year in which the Change in Control or Partial Change in Control takes place. The Company will select the firm to provide outplacement services.

        (c)    Mayo Executive Physical Program.    If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company will, for a period of 12 months following your termination, continue to allow you to participate in the Mayo Executive Physical Program and cover all expenses associated therewith, including, without limitation, travel, meals, lodging and fees.

5.

RETIREMENT AND SAVINGS PLAN.

        If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company shall make a payment to you equal to 110% of the amount of any forfeitures that you experience as a result of your termination of employment under any of the Company's pension, or profit sharing plans. If you experience forfeitures under the Accuride Cash Balance Pension Plan the amount of the Company's payment shall be equal to 110% of your unvested "Cash Balance Account" as defined in the Accuride Cash Balance Pension Plan, as it may be amended from time to time. The additional 10% payment provided for in this Section is to compensate you for the loss of the opportunity to defer taxes through a rollover of the forfeited amounts.

6.

CHANGE IN CONTROL AND PARTIAL CHANGE IN CONTROL DEFINED.

        For purposes of this Agreement, the term "Change in Control" shall mean and include (i) any sale, merger, consolidation, tender offer or similar acquisition of shares or other transaction or series of related transactions as a result of which at least a majority of the voting power of the Company is not held, directly or indirectly, by the persons or entities who held the Company's securities with voting power before such transactions or (ii) a sale or other disposition of all or a substantial part of the Company's assets, whether in one transaction or a series of related transactions; provided that, in the event of a transaction under either clause (i) or clause (ii) above, Kohlberg Kravis Roberts & Co. ("KKR") has liquidated at least 50% of its equity investment, as valued as of the date of the Change in Control, in the Company for cash consideration.

        For purposes of this Agreement, the term "Partial Change in Control" shall mean and include any transaction described in clause (i) or clause (ii) in the preceding paragraph, but without the proviso that KKR must liquidate 50% of its equity investment in the Company for cash consideration.

7.

GOOD REASON DEFINED.

        For purposes of this Agreement, "Good Reason" shall have different meanings depending on whether a Change in Control or a Partial Change in Control has occurred. Following a Change in Control, "Good Reason" shall mean the occurrence (without your prior express written consent) of any one of the following acts, or failures to act, unless, in the case of any act or failure to act described in clauses (a), (d), or (e) below, such act or failure to act is corrected by the Company prior to the date of termination specified in the Notice of Termination given by you in respect thereof not later than 60 days after the occurrence of the event that serves as the basis for the Notice of Termination:

        (a)  a significant change in your title, duties or responsibilities from those which are in effect immediately prior to the Change in Control which then results in a diminution in your position with the Company;

        (b)  a material reduction in your annual base salary or annual bonus opportunity as in effect as of the Change in Control unless such reduction is in connection with a general reduction of compensation at the Company affecting at least 90% of the officers of the Company which does not exceed 20% of your annual base salary;

        (c)  the relocation of the Company's principal executive offices to a location more than thirty (30) miles from its location on the date of this Agreement (or, if different, more than thirty (30) miles from where such offices are located immediately prior to any Change in Control) or the Company requiring you to be based anywhere other than the Company's principal executive offices except for required travel on the Company's business to an extent substantially consistent with your business travel obligations as of the date of this Agreement;

        (d)  a reduction in the kind or level of employee benefits to which you are entitled immediately before a Change in Control, with the result that your overall benefit package is significantly reduced;

        (e)  any breach by the Company of any provision of this agreement applicable to it which is material and adverse to you;

        (f)    the failure of the Company to obtain a written agreement reasonably satisfactory to you from any successor to the Company (as described in Section 11) to perform this Agreement.

        If a Partial Change in Control (but not a Change in Control) has occurred, then "Good Reason" shall have the same meaning as in the case of a Change in Control, with the following limitations:

        (x)  A temporary change in your title, duties or responsibilities, as described in (a) above, shall not constitute Good Reason; provided that the change is part of an acceptable written transition plan that includes the following provisions:

        (i)    The transition plan provides that by the end of the transition period you will be employed by the combined entity in a position that is comparable to or better than the position that you held with the Company prior to the Partial Change in Control;

        (ii)  The transition period will last no more than 18 months unless you agree otherwise in writing; and

        (iii)  If you are relocated during the transition period, your compensation and benefits will be adjusted in the same fashion as described in (y) below.

        (y)  Your relocation described in clause (iii) above, will not constitute Good Reason as long as the following requirements are met:

        (i)    Your annualized salary must be no lower than the greater of your annualized base salary at the time of the Partial Change in Control or the annualized base salary of the person who previously had your title and/or responsibilities at the acquiring company;

        (ii)  All moving and relocation expenses will be paid for by the Company or reimbursed on a liberal basis, including a "gross-up" on any taxable expenditures, extended temporary living expenses and participation in home buy-out program that is at least as favorable to you as the Company's current executive home buy-out program;

        (iii)  You will receive a reasonable relocation bonus equal to two-months' salary to deal with incidentals and the inconvenience of moving; and

        (iv)  You will retain current (or similar) benefits and perquisites consistent with your position in the new company including equity incentive awards and a change in control or severance agreement equivalent to other executives in the new company; provided that in the event the new company does not then have change in control agreements for its executives, you and the new company will negotiate in good faith a mutually acceptable change in control agreement for your benefit.

        If any of the criteria in clauses (x) or (y) are not satisfied, you will have the option to elect to terminate employment and receive the full Change in Control package as if you had terminated for Good Reason.

8.

CAUSE DEFINED.

        For purposes of this Agreement, "Cause" shall mean (a) your continued willful failure, neglect or refusal to perform your duties with respect to the Company; (b) conduct by you involving (i) dishonesty, fraud, or breach of trust in connection with your employment or (ii) conduct which would be a reasonable basis for an indictment for a felony or for a misdemeanor involving moral turpitude; (c) your willful and continued failure or refusal to follow material directions of the Board or any other act of insubordination by you; or (d) willful malfeasance or willful misconduct by you which is injurious to the Company, monetarily or otherwise.

9.

CAP ON BASIC PAYMENTS, SUPPLEMENTAL PAYMENTS AND SHAREHOLDER APPROVAL.

        (a)    General Rules.    The Internal Revenue Code (the "Code") places significant tax burdens on you and the Company if the total payments made to you due to a Change in Control exceed prescribed limits. For example, if your "Base Period Income" (as defined below) is $100,000, your limit or "Cap" is $299,999. If your "Basic Payments" exceed the Cap by even $1.00, you are subject to an excise tax under Section 4999 of the Code of 20% of all amounts paid to you in excess of $100,000. In other words, if your Cap is $299,999, you will not be subject to an excise tax if you receive exactly $299,999. If you receive $300,000, you will be subject to an excise tax of $40,000 (20% of $200,000). In order to avoid this excise tax and the related adverse tax consequences for the Company, by signing this Agreement you agree that your Basic Payments will not exceed an amount equal to your Cap.

        (b)    Special Definitions.    For purposes of this Section, the following specialized terms will have the following meanings:

        (i)    "Base Period Income".    "Base Period Income" is an amount equal to your "annualized includable compensation" for the "base period" as defined in Sections 280G(d)(1) and (2) of the Code and the regulations adopted thereunder. Generally, your "annualized includable compensation" is the average of your annual taxable income from the Company for the "base period," which is the five calendar years prior to the year in which the Change in Control occurs. These concepts are complicated and technical and all of the rules set forth in the applicable regulations apply for purposes of this Agreement.

        (ii)    "Cap" or "280G Cap".    "Cap" or "280G Cap" shall mean an amount equal to 2.99 times your "Base Period Income". This is the maximum amount which you may receive without becoming subject to the excise tax imposed by Section 4999 of the Code or which the Company may pay without loss of deduction under Section 280G of the Code.

        (iii)    "Basic Payments".    The "Basic Payments" include any "payments in the nature of compensation" (as defined in Section 280G of the Code and the regulations adopted thereunder), made pursuant to this Agreement or otherwise, to you or for your benefit, the receipt of which is contingent on a Change in Control and to which Section 280G of the Code applies.

        (c)    Calculating the Cap.    If the Company believes that these rules will result in a reduction of the payments to which you are entitled under this Agreement, it will so notify you as soon as possible. The Company will then, at its expense, retain a "Consultant" (which shall be a law firm, a certified public accounting firm, and/or a firm of recognized executive compensation consultants) to provide an opinion or opinions concerning whether your Basic Payments exceed the limit discussed above. The Company will select the Consultant.

        At a minimum, the opinions required by this Section must set forth the amount of your Base Period Income, the value of the Basic Payments and the amount and present value of any excess parachute payments.

        If the opinions state that there would be an excess parachute payment, your payments under this Agreement will be reduced to the extent necessary to eliminate the excess such that no excise tax will be payable under Section 4999 of the Code in respect of your Basic Payments. You will be allowed to choose the payment that should be reduced or eliminated, but the payment you choose to reduce or eliminate must be a payment determined by such Consultant to be includable in Basic Payments. You will make your decision in writing and deliver it to the Company within 30 days of your receipt of such opinions. If you fail to so notify the Company, it will decide which payments to reduce or eliminate.

        If the Consultant selected to provide the opinions referred to above so requests in connection with the opinion required by this Section, a firm of recognized executive compensation consultants selected by the Company (which may, but is not required to be, the Consultant) shall provide an opinion, upon which such Consultant may rely, as to the reasonableness of any item of compensation as reasonable compensation for services rendered before or after the Change in Control.

        If the Company believes that your Basic Payments will exceed the limitations of this Section, it will nonetheless make payments to you, at the times stated above, in the maximum amount that it believes may be paid without exceeding such limitations. The balance, if any, will then be paid after the opinions called for above have been received.

        If the amount paid to you by the Company is ultimately determined, pursuant to the opinion referred to above or by the Internal Revenue Service, to have exceeded the limitation of this Section, the excess will be treated as a loan to you by the Company and shall be repayable on the 90th day following demand by the Company, together with interest at the lowest "applicable federal rate" provided in Section 1274(d) of the Code. If it is ultimately determined, pursuant to the opinion referred to above or by the Internal Revenue Service, that a greater payment should have been made to you, the Company shall pay you the amount of the deficiency, together with interest thereon from the date such amount should have been paid to the date of such payment, at the rate set forth above, so that you will have received or be entitled to receive the maximum amount to which you are entitled under this Agreement.

        (d)    Supplemental Payment.    If your Basic Payments are limited pursuant to Section 9(a), then, subject to shareholder approval pursuant to Section 9(e), you shall receive a "Supplemental Payment" as described herein. Your "Supplemental Payment" is the difference between your "Capped Benefit" and the amount to which you will be entitled pursuant to this Agreement without regard to the limitations of Section 9(a). For this purpose, your "Capped Benefit" is the amount to which you will be entitled pursuant to this Agreement, as applicable, after the application of the limitations of Section 9(a). The Consultant selected pursuant to Section 9(c) will calculate your "Capped Benefit" and the "Supplemental Payment."

        (e)    Shareholder Approval.    The Supplemental Payment described herein, shall be subject to approval by the Company's shareholders holding more than 75% of the voting power of the Company's outstanding stock as of the date such approval is obtained, and no Supplemental Payment shall be made pursuant to this Agreement unless and until such approval is obtained. This shareholder approval is intended to satisfy and shall be sought in accordance with the requirements of Section 280G(b)(5)(B) of the Code and the regulations thereunder. A copy of the form of this Agreement and adequate disclosure for purposes of Section 280G(b)(5)(B)(ii) will be provided to the Company's shareholders.

        (f)    Calculations.    All determinations concerning the Cap and any Supplemental Payment (as well as any assumptions to be used in making such determinations) shall be made by the Consultant selected pursuant to Section 9(c). The Consultant shall provide you and the Company with a written notice of the Cap and the amount of any Supplemental Payment. The notice from the Consultant shall include any necessary calculations in support of its conclusions. All fees and expenses of the Consultant shall be borne by the Company.

        As a general rule, the Consultant's determination shall be binding on you and the Company. Section 280G and the excise tax rules of Section 4999, however, are complex and uncertain and, as a result, the Internal Revenue Service may disagree with the Consultant's conclusions. If the Internal Revenue Service determines that the Cap is actually lower than calculated by the Consultant, the Cap will be recalculated by the Consultant. Any payment over that revised Cap will then be paid by you to the Company. If the Internal Revenue Service determines that the actual Cap exceeds the amount calculated by the Consultant, the Company shall pay you any shortage (unless such amounts were already paid through a Supplemental Payment).

        The Company has the right to challenge any determinations made by the Internal Revenue Service. If the Company agrees to indemnify you from any taxes, interest and penalties that may be imposed upon you (including any taxes, interest and penalties on the amounts paid pursuant to the Company's indemnification agreement), you must cooperate fully with the Company in connection with any such challenge. The Company shall bear all costs associated with the challenge of any determination made by the Internal Revenue Service and the Company shall control all such challenges.

        You must notify the Company in writing of any claim or determination by the Internal Revenue Service that, if upheld, would result in the payment of excise taxes. Such notice shall be given as soon as possible but in no event later than 15 days following your receipt of notice of the Internal Revenue Service's position.

        (g)    Effect of Repeal or Inapplicablity.    In the event that the provisions of Sections 280G and 4999 of the Code are repealed without succession, this Section shall be of no further force or effect. Moreover, if the provisions of Sections 280G and 4999 of the Code do not apply to impose the excise tax to payments under this Agreement, then the provisions of this Section shall not apply.

10.

TERMINATION NOTICE AND PROCEDURE.

        Any termination by the Company or you of your employment shall be communicated by written Notice of Termination to you if such Notice of Termination is delivered by the Company and to the Company if such Notice of Termination is delivered by you, all in accordance with the following procedures:

        (a)  The Notice of Termination shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances alleged to provide a basis for termination.

        (b)  Any Notice of Termination by the Company shall be in writing signed by the President of the Company or a member of the Board who is not a Company employee, specifying in detail the basis for such termination.

        (c)  If the Company shall furnish a Notice of Termination for Cause and you in good faith notify the Company that a dispute exists concerning such termination within the 15 day period following your receipt of such notice, you may elect to continue your employment during such dispute. If it is thereafter determined that Cause did exist, your "Termination Date" shall be the earlier of (i) the date on which the dispute is finally determined, either by mutual written agreement of the parties or pursuant to the alternative dispute resolution provisions of Section 17 or (ii) the date of your death. If it is thereafter determined that Cause did not exist, your employment shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such notice.

        (d)  If the Company shall furnish a Notice of Termination by reason of Disability and you in good faith notify the Company that a dispute exists concerning such termination within the 15-day period following your receipt of such notice, you may elect to continue your employment during such dispute. The dispute relating to the existence of a Disability shall be resolved by the opinion of the licensed physician selected by Accuride; provided, however, that if you do not accept the opinion of the licensed physician selected by Accuride, the dispute shall be resolved by the opinion of a licensed physician who shall be selected by you; provided further, however, that if Accuride does not accept the opinion of the licensed physician selected by you, the dispute shall be finally resolved by the opinion of a licensed physician selected by the licensed physicians selected by Accuride and you, respectively. If it is thereafter determined that a Disability did exist, your Termination Date shall be the earlier of (i) the date on which the dispute is resolved or (ii) the date of your death. If it is thereafter determined that a Disability did not exist, your employment shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such notice. For purposes of this Agreement, "Disability" shall mean your inability to perform your customary duties for the Company due to a physical or mental condition that is considered to be of long-lasting or indefinite duration.

        (e)  If you in good faith furnish a Notice of Termination for Good Reason and the Company notifies you that a dispute exists concerning the termination within the 15 day period following the Company's receipt of such notice, you may elect to continue your employment during such dispute. If it is thereafter determined that Good Reason did exist, your Termination Date shall be the earlier of (i) the date on which the dispute is finally determined, either by mutual written agreement of the parties or pursuant to the alternative dispute resolution provisions of Section 17, (ii) the date of your death, or (iii) one day prior to the 18 month anniversary of a Change in Control, and your payments hereunder shall reflect events occurring after you delivered Notice of Termination. If it is thereafter determined that Good Reason did not exist, your employment shall continue after such determination as if you had not delivered the Notice of Termination asserting Good Reason.

        (f)    If you submit a Notice of Termination for Good Reason, and the Company successfully contests the grounds you set forth in such Notice of Termination, at the Company's discretion you may be deemed to have voluntarily terminated your employment other than for Good Reason regardless whether you elect to continue employment pending resolution of the dispute regarding your Notice of Termination.

        (g)  If the Company submits a Notice of Termination for Cause, and you successfully contest the grounds set forth in such Notice of Termination, the Company will be deemed to have terminated you other than by reason of Disability or Cause if you do not elect to continue employment pending resolution of the dispute regarding your Notice of Termination.

        (h)  For purposes of this Agreement, a transfer from Accuride to one of its subsidiaries or a transfer from a subsidiary to Accuride or another subsidiary shall not be treated as a termination of employment. Such a transfer may, however, in certain circumstances, provide you with Good Reason to terminate employment pursuant to Section 7.

11.

SUCCESSORS.

        Accuride will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of Accuride or any of its subsidiaries to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Accuride or any subsidiary would be required to perform it if no such succession had taken place. Failure of Accuride to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to the compensation described in this Agreement to which you would be entitled hereunder as if you terminate your employment for Good Reason following a Change in Control, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Termination Date. As used in this Agreement, "Accuride" shall mean Accuride as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law or otherwise.

12.

BINDING AGREEMENT.

        This Agreement shall inure to the benefit of and be enforceable by you and your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you should die while any amount would still be payable to you hereunder had you continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate.

13.

NOTICE.

        For purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notices to Accuride shall be directed to the attention of the President of the Company or a member of the Board who is not a Company employee with a copy to the Secretary of Accuride, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

14.

MISCELLANEOUS.

        No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and the President of the Company or a member of the Board who is not a Company employee. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Indiana without regard to its conflicts of law principles. All references to sections of the Securities Exchange Act of 1934 or the Code shall be deemed also to refer to any successor provisions to such sections. Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law. The obligations of the Company that arise prior to the expiration of this Agreement shall survive the expiration of the term of this Agreement.

15.

VALIDITY.

        The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

16.

COUNTERPARTS.

        This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

17.

ALTERNATIVE DISPUTE RESOLUTION.

        (a)    Mediation.    Unless otherwise provided herein (such as in Sections 9 and 10(d)), any and all disputes arising under, pertaining to or touching upon this Agreement or the statutory rights or obligations of either party hereto, shall, if not settled by negotiation, be subject to non-binding mediation before an independent mediator selected by the parties pursuant to Section 17(d). Notwithstanding the foregoing, both you and Accuride may seek preliminary judicial relief if such action is necessary to avoid irreparable damage during the pendency of the proceedings described in this Section 17. Any demand for mediation shall be made in writing and served upon the other party to the dispute, by certified mail, return receipt requested, at the business address of Accuride, or at your last known residence address, respectively. The demand shall set forth with reasonable specificity the basis of the dispute and the relief sought. The mediation hearing will occur at a time and place convenient to the parties in Evansville, Indiana, within 30 days of the date of selection or appointment of the mediator.

        (b)    Arbitration.    In the event that the dispute is not settled through mediation, the parties shall then proceed to binding arbitration before a single independent arbitrator selected pursuant to Section 17(d). The mediator shall not serve as arbitrator. TO THE EXTENT ALLOWABLE UNDER APPLICABLE LAW, ALL DISPUTES INVOLVING ALLEGED UNLAWFUL EMPLOYMENT DISCRIMINATION, BREACH OF CONTRACT OR POLICY, OR EMPLOYMENT TORT COMMITTED BY ACCURIDE OR A REPRESENTATIVE OF ACCURIDE, INCLUDING CLAIMS OF VIOLATIONS OF FEDERAL OR STATE DISCRIMINATION STATUTES OR PUBLIC POLICY, SHALL BE RESOLVED PURSUANT TO THIS POLICY AND THERE SHALL BE NO RECOURSE TO COURT, WITH OR WITHOUT A JURY TRIAL. The arbitration hearing shall occur at a time and place convenient to the parties in Evansville, Indiana, within 30 days of selection or appointment of the arbitrator. If Accuride has adopted a policy that is applicable to arbitrations with executives, the arbitration shall be conducted in accordance with said policy to the extent that the policy is consistent with this Agreement and the Federal Arbitration Act, 9 U.S.C. §§ 1-16. If no such policy has been adopted, the arbitration shall be governed by the National Rules for the Resolution of Employment Disputes of AAA in effect on the date of the first notice of demand for arbitration. The arbitrator shall issue written findings of fact and conclusions of law, and an award, within 15 days of the date of the hearing unless the parties otherwise agree.

        (c)    Damages.    In cases of breach of contract or policy, damages shall be limited to contract damages. In cases of discrimination claims prohibited by statute, the arbitrator may direct payment consistent with the applicable statute. In cases of employment tort, the arbitrator may award punitive damages if proved by clear and convincing evidence. The arbitrator may award attorneys' fees to the prevailing party and assess costs against the non-prevailing party, only in accordance with Section 18 of this Agreement. Issues of procedure, arbitrability, or confirmation of award shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16, except that Court review of the arbitrator's award shall be that of an appellate court reviewing a decision of a trial judge sitting without a jury.

        (d)    Selection of Mediators or Arbitrators.    The parties shall select the mediator or arbitrator from a panel list made available by the AAA. If the parties are unable to agree to a mediator or arbitrator within 10 days of receipt of a demand for mediation or arbitration, the mediator or arbitrator will be chosen by alternatively striking from a list of five mediators or arbitrators obtained by Accuride from AAA. You shall have the first strike.

18.

EXPENSES AND INTEREST.

        If a good faith dispute shall arise with respect to the enforcement of your rights under this Agreement or if any arbitration or legal proceeding shall be brought in good faith to enforce or interpret any provision contained herein, or to recover damages for breach hereof, and you are the prevailing party, you shall recover from the Company any reasonable attorneys' fees and necessary costs and disbursements incurred as a result of such dispute or legal proceeding, and prejudgment interest on any money judgment obtained by you calculated at the rate of interest announced by Citibank from time to time as its prime rate from the date that payments to you should have been made under this Agreement. It is expressly provided that the Company shall in no event recover from you any attorneys' fees, costs, disbursements or interest as a result of any dispute or legal proceeding involving the Company and you.

19.

PAYMENT OBLIGATIONS ABSOLUTE.

        Accuride's obligation to pay you the compensation and to make the arrangements in accordance with the provisions herein shall be absolute and unconditional and shall not be affected by any circumstances; provided, however, that the Company may apply amounts payable under this Agreement to any debts owed to the Company by you on your Termination Date. All amounts payable by the Company in accordance with this Agreement shall be paid without notice or demand. If the Company has paid you more than the amount to which you are entitled under this Agreement, the Company shall have the right to recover all or any part of such overpayment from you or from whomsoever has received such amount.

20.

ENTIRE AGREEMENT.

        This Agreement, the Accuride Corporation Separation Pay Plan, any severance agreement between you and the Company, and any Stock Option Agreements set forth the entire agreement between you and the Company concerning the subject matter discussed in such agreements and supersede all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether written or oral, by any officer, employee or representative of the Company. Any prior agreements or understandings with respect to the subject matter set forth in the aforementioned agreements are hereby terminated and canceled.

21.

DEFERRAL OF PAYMENTS.

        To the extent that any payment under this Agreement, when combined with all other payments received during the year that are subject to the limitations on deductibility under Section 162(m) of the Code, exceeds the limitations on deductibility under Section 162(m) of the Code, such payment shall, in the discretion of the Company, be deferred to the next succeeding calendar year. Such deferred amounts shall be paid no later than the 60th day after the end of such next succeeding calendar year, provided that such payment, when combined with any other payments subject to the Section 162(m) limitations received during the year, does not exceed the limitations on deductibility under Section 162(m) of the Code.

22.

PARTIES.

        This Agreement is an agreement between you and Accuride. In certain cases, though, obligations imposed upon Accuride may be satisfied by a Accuride subsidiary. Any payment made or action taken by a Accuride subsidiary shall be considered to be a payment made or action taken by Accuride for purposes of determining whether Accuride has satisfied its obligations under this Agreement.

        If you would like to participate in this special benefits program, please sign and return the extra copy of this letter which is enclosed.

Sincerely,

William P. Greubel
President & CEO
Accuride Corporation

Enclosure

ACCEPTANCE

        I hereby accept the offer to participate in this special benefit program and I agree to be bound by all of the provisions noted above.

Tier I Employee
Title

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Tier I Employee Change in Control Agreement

EX-10.38

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November 20, 2001

Tier II Employee
Accuride Corporation
7140 Office Circle
Evansville, IN 47715

Change in Control Agreement

Dear Tier II Employee:

        Our Board of Directors believes that it is in the best interests of Accuride Corporation ("Accuride") and its shareholders to take appropriate steps to allay any concerns you may have about your future employment opportunities with Accuride and its subsidiaries (Accuride and its subsidiaries are collectively referred to as the "Company"). As a result, the Board has decided to offer to you the special package of benefits described below.

        Please bear in mind that these benefits are being offered only to a few selected employees and we accordingly ask that you refrain from discussing this special program with others. Also, please note that the special benefits package described below will only be effective if you sign the extra copy of this Change in Control Agreement (the "Agreement") which is enclosed and return it to me on or before December 15, 2001. This Agreement supersedes any other change in control agreements entered into previously by you and the Company, whether written or oral.

1.

TERM OF AGREEMENT.

        This Agreement is effective immediately and will continue in effect for a three-year term, ending on December 31, 2004 (the "Initial Term"). This Agreement will be automatically renewed at the end of the Initial Term for additional terms commencing on each January 1, and ending on the next following December 31 (a "Renewal Term"), unless either party serves notice of desire to terminate or modify this Agreement on the other. Such notice must comply with Section 13 and be given at least six months before the end of the Initial Term or the applicable Renewal Term. If a Change in Control or a Partial Change in Control occurs during the Initial Term or any Renewal Term, the scheduled expiration date of the Initial Term or Renewal Term, as the case may be, shall be extended for a term ending on the 18-month anniversary of the Change in Control or Partial Change in Control. Termination of this Agreement will not reduce or diminish any liabilities that have accrued prior to termination.

2.

SEVERANCE PAYMENT.

        If your employment with the Company is terminated without "Cause" (as defined in Section 8) within 18 months following a Change in Control or Partial Change in Control, you will receive the "Severance Payment" described below. The Severance Payment also will be payable if you terminate your employment for "Good Reason" (as defined in Section 7) within 18 months following a Change in Control or Partial Change in Control.

        The "Severance Payment" is a lump sum payment equal to the sum of: (a) 200% of your annualized base salary as of the date on which a Change in Control or Partial Change in Control occurs, plus (b) 200% of any bonus or incentive compensation paid or payable to you pursuant to the Company's Incentive Compensation Program, determined as the greater of the following: (i) the incentive compensation to which you would have been entitled if the year were to end on the day on which the Change in Control or Partial Change in Control occurs, based upon an annualized figure determined using performance up to that date; or (ii) the average of the actual incentive compensation paid to you through the Incentive Compensation Program during the three years preceding the year of your termination. The Severance Payment shall be reduced by the full amount of any payments to which you may be entitled due to your termination pursuant to any other Company severance policy, any agreement between you and the Company providing for severance, or applicable law.

        The Severance Payment will be paid in one lump sum within 10 days following your termination of employment.

        The Severance Payment will not be payable if your employment is terminated for Cause, if you terminate your employment without Good Reason, or if your employment is terminated by reason of your "Disability" (as defined in Section 10(d)) or your death. In addition, the Severance Payment will not be payable if your employment is terminated by you or the Company for any or no reason before a Change in Control or Partial Change in Control occurs or more than 18 months after a Change in Control or Partial Change in Control has occurred.

        In order to receive the Severance Payment, you must execute a release of known or unknown claims that you may have against the Company. The release shall be in a form reasonably requested by Company.

        The Severance Payment will be payable without regard to whether you look for or obtain alternative employment following your termination of employment with the Company.

3.

ACCELERATION OF OR PAYMENT FOR OPTIONS.

        If an agreement is entered into that will result in a Change in Control or Partial Change in Control, before the Change in Control or Partial Change in Control occurs the Compensation Committee of the Company's Board of Directors will accelerate the exercisability of any options you hold to acquire Company stock in accordance with the acceleration provisions of the 1998 Stock Purchase and Option Plan for Employees of Accuride Corporation and Subsidiaries.

4.

OTHER BENEFITS.

        (a)    In General.    If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company shall arrange to provide you, for an 18-month period, with disability, accident, dental and group health insurance benefits substantially similar to those which you were receiving immediately prior to your termination. The cost to you of a particular type of benefit (e.g., dental insurance) shall be not more than the cost to you of that particular benefit immediately prior to your termination. The Company may provide the health insurance benefit described under this Section by paying a portion of the premiums you are required to pay for continued health insurance coverage under the Company's health insurance plan pursuant to COBRA. The amount paid by the Company will be equal to the difference between the total COBRA premium and the amount you were required to pay for health insurance immediately prior to your termination.

        Your right to receive continued health insurance benefits pursuant to COBRA shall commence upon the termination of your employment and shall not be extended by your rights under this Agreement.

        Your right to receive all forms of benefits described under this paragraph (a) shall terminate as soon as you become eligible to receive health care benefits, without exclusion for pre-existing conditions, from any other employer.

        (b)    Outplacement and Financial Planning Benefits.    If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company will provide you with (i) senior executive outplacement services; and (ii) a tax and financial planning services stipend in an amount equal to the amount you received in the year prior to the year in which the Change in Control or Partial Change in Control takes place. The Company will select the firm to provide outplacement services.

        (c)    Mayo Executive Physical Program.    If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company will, for a period of 12 months following your termination, continue to allow you to participate in the Mayo Executive Physical Program and cover all expenses associated therewith, including, without limitation, travel, meals, lodging and fees.

5.

RETIREMENT AND SAVINGS PLAN.

        If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company shall make a payment to you equal to 110% of the amount of any forfeitures that you experience as a result of your termination of employment under any of the Company's pension, or profit sharing plans. If you experience forfeitures under the Accuride Cash Balance Pension Plan the amount of the Company's payment shall be equal to 110% of your unvested "Cash Balance Account" as defined in the Accuride Cash Balance Pension Plan, as it may be amended from time to time. The additional 10% payment provided for in this Section is to compensate you for the loss of the opportunity to defer taxes through a rollover of the forfeited amounts.

6.

CHANGE IN CONTROL AND PARTIAL CHANGE IN CONTROL DEFINED.

        For purposes of this Agreement, the term "Change in Control" shall mean and include (i) any sale, merger, consolidation, tender offer or similar acquisition of shares or other transaction or series of related transactions as a result of which at least a majority of the voting power of the Company is not held, directly or indirectly, by the persons or entities who held the Company's securities with voting power before such transactions or (ii) a sale or other disposition of all or a substantial part of the Company's assets, whether in one transaction or a series of related transactions; provided that, in the event of a transaction under either clause (i) or clause (ii) above, Kohlberg Kravis Roberts & Co. ("KKR") has liquidated at least 50% of its equity investment, as valued as of the date of the Change in Control, in the Company for cash consideration.

        For purposes of this Agreement, the term "Partial Change in Control" shall mean and include any transaction described in clause (i) or clause (ii) in the preceding paragraph, but without the proviso that KKR must liquidate 50% of its equity investment in the Company for cash consideration.

7.

GOOD REASON DEFINED.

        For purposes of this Agreement, "Good Reason" shall have different meanings depending on whether a Change in Control or a Partial Change in Control has occurred. Following a Change in Control, "Good Reason" shall mean the occurrence (without your prior express written consent) of any one of the following acts, or failures to act, unless, in the case of any act or failure to act described in clauses (a), (d), or (e) below, such act or failure to act is corrected by the Company prior to the date of termination specified in the Notice of Termination given by you in respect thereof not later than 60 days after the occurrence of the event that serves as the basis for the Notice of Termination:

        (a)  a significant change in your title, duties or responsibilities from those which are in effect immediately prior to the Change in Control which then results in a diminution in your position with the Company;

        (b)  a material reduction in your annual base salary or annual bonus opportunity as in effect as of the Change in Control unless such reduction is in connection with a general reduction of compensation at the Company affecting at least 90% of the officers of the Company which does not exceed 20% of your annual base salary;

        (c)  the relocation of the Company's principal executive offices to a location more than thirty (30) miles from its location on the date of this Agreement (or, if different, more than thirty (30) miles from where such offices are located immediately prior to any Change in Control) or the Company requiring you to be based anywhere other than the Company's principal executive offices except for required travel on the Company's business to an extent substantially consistent with your business travel obligations as of the date of this Agreement;

        (d)  a reduction in the kind or level of employee benefits to which you are entitled immediately before a Change in Control, with the result that your overall benefit package is significantly reduced;

        (e)  any breach by the Company of any provision of this agreement applicable to it which is material and adverse to you;

        (f)    the failure of the Company to obtain a written agreement reasonably satisfactory to you from any successor to the Company (as described in Section 11) to perform this Agreement.

        If a Partial Change in Control (but not a Change in Control) has occurred, then "Good Reason" shall have the same meaning as in the case of a Change in Control, with the following limitations:

        (x)  A temporary change in your title, duties or responsibilities, as described in (a) above, shall not constitute Good Reason; provided that the change is part of an acceptable written transition plan that includes the following provisions:

        (i)    The transition plan provides that by the end of the transition period you will be employed by the combined entity in a position that is comparable to or better than the position that you held with the Company prior to the Partial Change in Control;

        (ii)  The transition period will last no more than 18 months unless you agree otherwise in writing. and

        (iii)  If you are relocated during the transition period, your compensation and benefits will be adjusted in the same fashion as described in (y) below.

        (y)  Your relocation described in clause (iii) above, will not constitute Good Reason as long as the following requirements are met:

        (i)    Your annualized salary must be no lower than the greater of your annualized base salary at the time of the Partial Change in Control or the annualized base salary of the person who previously had your title and/or responsibilities at the acquiring company;

        (ii)  All moving and relocation expenses will be paid for by the Company or reimbursed on a liberal basis, including a "gross-up" on any taxable expenditures, extended temporary living expenses and participation in home buy-out program that is at least as favorable to you as the Company's current executive home buy-out program;

        (iii)  You will receive a reasonable relocation bonus equal to two-months' salary to deal with incidentals and the inconvenience of moving; and

        (iv)  You will retain current (or similar) benefits and perquisites consistent with your position in the new company including equity incentive awards and a change in control or severance agreement equivalent to other executives in the new company; provided that in the event the new company does not then have change in control agreements for its executives, you and the new company will negotiate in good faith a mutually acceptable change in control agreement for your benefit.

        If any of the criteria in clauses (x) or (y) are not satisfied, you will have the option to elect to terminate employment and receive the full Change in Control package as if you had terminated for Good Reason.

8.

CAUSE DEFINED.

        For purposes of this Agreement, "Cause" shall mean (a) your continued willful failure, neglect or refusal to perform your duties with respect to the Company; (b) conduct by you involving (i) dishonesty, fraud, or breach of trust in connection with your employment or (ii) conduct which would be a reasonable basis for an indictment for a felony or for a misdemeanor involving moral turpitude; (c) your willful and continued failure or refusal to follow material directions of the Board or any other act of insubordination by you; or (d) willful malfeasance or willful misconduct by you which is injurious to the Company, monetarily or otherwise.

9.

CAP ON PAYMENTS.

        (a)    General Rules.    The Internal Revenue Code (the "Code") places significant tax burdens on you and the Company if the total payments made to you due to a Change in Control exceed prescribed limits. For example, if your "Base Period Income" (as defined below) is $100,000, your limit or "Cap" is $299,999. If your "Basic Payments" exceed the Cap by even $1.00, you are subject to an excise tax under Section 4999 of the Code of 20% of all amounts paid to you in excess of $100,000. In other words, if your Cap is $299,999, you will not be subject to an excise tax if you receive exactly $299,999. If you receive $300,000, you will be subject to an excise tax of $40,000 (20% of $200,000). In order to avoid this excise tax and the related adverse tax consequences for the Company, by signing this Agreement you agree that your Basic Payments will not exceed an amount equal to your Cap.

        (b)    Special Definitions.    For purposes of this Section, the following specialized terms will have the following meanings:

        (i)    "Base Period Income".    "Base Period Income" is an amount equal to your "annualized includable compensation" for the "base period" as defined in Sections 280G(d)(1) and (2) of the Code and the regulations adopted thereunder. Generally, your "annualized includable compensation" is the average of your annual taxable income from the Company for the "base period," which is the five calendar years prior to the year in which the Change in Control occurs. These concepts are complicated and technical and all of the rules set forth in the applicable regulations apply for purposes of this Agreement.

        (ii)    "Cap" or "280G Cap".    "Cap" or "280G Cap" shall mean an amount equal to 2.99 times your "Base Period Income". This is the maximum amount which you may receive without becoming subject to the excise tax imposed by Section 4999 of the Code or which the Company may pay without loss of deduction under Section 280G of the Code.

        (iii)    "Basic Payments".    The "Basic Payments" include any "payments in the nature of compensation" (as defined in Section 280G of the Code and the regulations adopted thereunder), made pursuant to this Agreement or otherwise, to you or for your benefit, the receipt of which is contingent on a Change in Control and to which Section 280G of the Code applies.

        (c)    Calculating the Cap.    If the Company believes that these rules will result in a reduction of the payments to which you are entitled under this Agreement, it will so notify you as soon as possible. The Company will then, at its expense, retain a "Consultant" (which shall be a law firm, a certified public accounting firm, and/or a firm of recognized executive compensation consultants) to provide an opinion or opinions concerning whether your Basic Payments exceed the limit discussed above. The Company will select the Consultant.

        At a minimum, the opinions required by this Section must set forth the amount of your Base Period Income, the value of the Basic Payments and the amount and present value of any excess parachute payments.

        If the opinions state that there would be an excess parachute payment, your payments under this Agreement will be reduced to the extent necessary to eliminate the excess such that no excise tax will be payable under Section 4999 of the Code in respect of your Basic Payments. You will be allowed to choose the payment that should be reduced or eliminated, but the payment you choose to reduce or eliminate must be a payment determined by such Consultant to be includable in Basic Payments. You will make your decision in writing and deliver it to the Company within 30 days of your receipt of such opinions. If you fail to so notify the Company, it will decide which payments to reduce or eliminate.

        If the Consultant selected to provide the opinions referred to above so requests in connection with the opinion required by this Section, a firm of recognized executive compensation consultants selected by the Company (which may, but is not required to be, the Consultant) shall provide an opinion, upon which such Consultant may rely, as to the reasonableness of any item of compensation as reasonable compensation for services rendered before or after the Change in Control.

        If the Company believes that your Basic Payments will exceed the limitations of this Section, it will nonetheless make payments to you, at the times stated above, in the maximum amount that it believes may be paid without exceeding such limitations. The balance, if any, will then be paid after the opinions called for above have been received.

        If the amount paid to you by the Company is ultimately determined, pursuant to the opinion referred to above or by the Internal Revenue Service, to have exceeded the limitation of this Section, the excess will be treated as a loan to you by the Company and shall be repayable on the 90th day following demand by the Company, together with interest at the lowest "applicable federal rate" provided in Section 1274(d) of the Code. If it is ultimately determined, pursuant to the opinion referred to above or by the Internal Revenue Service, that a greater payment should have been made to you, the Company shall pay you the amount of the deficiency, together with interest thereon from the date such amount should have been paid to the date of such payment, at the rate set forth above, so that you will have received or be entitled to receive the maximum amount to which you are entitled under this Agreement.

        (d)    Calculations.    All determinations concerning the Cap (as well as any assumptions to be used in making such determinations) shall be made by the Consultant selected pursuant to Section 9(c). The Consultant shall provide you and the Company with a written notice of the Cap. The notice from the Consultant shall include any necessary calculations in support of its conclusions. All fees and expenses of the Consultant shall be borne by the Company.

        As a general rule, the Consultant's determination shall be binding on you and the Company. Section 280G and the excise tax rules of Section 4999, however, are complex and uncertain and, as a result, the Internal Revenue Service may disagree with the Consultant's conclusions. If the Internal Revenue Service determines that the Cap is actually lower than calculated by the Consultant, the Cap will be recalculated by the Consultant. Any payment over that revised Cap will then be paid by you to the Company. If the Internal Revenue Service determines that the actual Cap exceeds the amount calculated by the Consultant, the Company shall pay you any shortage.

        The Company has the right to challenge any determinations made by the Internal Revenue Service. If the Company agrees to indemnify you from any taxes, interest and penalties that may be imposed upon you (including any taxes, interest and penalties on the amounts paid pursuant to the Company's indemnification agreement), you must cooperate fully with the Company in connection with any such challenge. The Company shall bear all costs associated with the challenge of any determination made by the Internal Revenue Service and the Company shall control all such challenges.

        You must notify the Company in writing of any claim or determination by the Internal Revenue Service that, if upheld, would result in the payment of excise taxes. Such notice shall be given as soon as possible but in no event later than 15 days following your receipt of notice of the Internal Revenue Service's position.

        (e)    Effect of Repeal or Inapplicablity.    In the event that the provisions of Sections 280G and 4999 of the Code are repealed without succession, this Section shall be of no further force or effect. Moreover, if the provisions of Sections 280G and 4999 of the Code do not apply to impose the excise tax to payments under this Agreement, then the provisions of this Section shall not apply.

10.

TERMINATION NOTICE AND PROCEDURE.

        Any termination by the Company or you of your employment shall be communicated by written Notice of Termination to you if such Notice of Termination is delivered by the Company and to the Company if such Notice of Termination is delivered by you, all in accordance with the following procedures:

        (a)  The Notice of Termination shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances alleged to provide a basis for termination.

        (b)  Any Notice of Termination by the Company shall be in writing signed by the President of the Company or a member of the Board who is not a Company employee, specifying in detail the basis for such termination.

        (c)  If the Company shall furnish a Notice of Termination for Cause and you in good faith notify the Company that a dispute exists concerning such termination within the 15 day period following your receipt of such notice, you may elect to continue your employment during such dispute. If it is thereafter determined that Cause did exist, your "Termination Date" shall be the earlier of (i) the date on which the dispute is finally determined, either by mutual written agreement of the parties or pursuant to the alternative dispute resolution provisions of Section 17 or (ii) the date of your death. If it is thereafter determined that Cause did not exist, your employment shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such notice.

        (d)  If the Company shall furnish a Notice of Termination by reason of Disability and you in good faith notify the Company that a dispute exists concerning such termination within the 15 day period following your receipt of such notice, you may elect to continue your employment during such dispute. The dispute relating to the existence of a Disability shall be resolved by the opinion of the licensed physician selected by Accuride; provided, however, that if you do not accept the opinion of the licensed physician selected by Accuride, the dispute shall be resolved by the opinion of a licensed physician who shall be selected by you; provided further, however, that if Accuride does not accept the opinion of the licensed physician selected by you, the dispute shall be finally resolved by the opinion of a licensed physician selected by the licensed physicians selected by Accuride and you, respectively. If it is thereafter determined that a Disability did exist, your Termination Date shall be the earlier of (i) the date on which the dispute is resolved or (ii) the date of your death. If it is thereafter determined that a Disability did not exist, your employment shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such notice. For purposes of this Agreement, "Disability" shall mean your inability to perform your customary duties for the Company due to a physical or mental condition that is considered to be of long-lasting or indefinite duration.

        (e)  If you in good faith furnish a Notice of Termination for Good Reason and the Company notifies you that a dispute exists concerning the termination within the 15 day period following the Company's receipt of such notice, you may elect to continue your employment during such dispute. If it is thereafter determined that Good Reason did exist, your Termination Date shall be the earlier of (i) the date on which the dispute is finally determined, either by mutual written agreement of the parties or pursuant to the alternative dispute resolution provisions of Section 17, (ii) the date of your death, or (iii) one day prior to the 18 month anniversary of a Change in Control, and your payments hereunder shall reflect events occurring after you delivered Notice of Termination. If it is thereafter determined that Good Reason did not exist, your employment shall continue after such determination as if you had not delivered the Notice of Termination asserting Good Reason.

        (f)    If you submit a Notice of Termination for Good Reason, and the Company successfully contests the grounds you set forth in such Notice of Termination, at the Company's discretion you may be deemed to have voluntarily terminated your employment other than for Good Reason regardless whether you elect to continue employment pending resolution of the dispute regarding your Notice of Termination.

        (g)  If the Company submits a Notice of Termination for Cause, and you successfully contest the grounds set forth in such Notice of Termination, the Company will be deemed to have terminated you other than by reason of Disability or Cause if you do not elect to continue employment pending resolution of the dispute regarding your Notice of Termination.

        (h)  For purposes of this Agreement, a transfer from Accuride to one of its subsidiaries or a transfer from a subsidiary to Accuride or another subsidiary shall not be treated as a termination of employment. Such a transfer may, however, in certain circumstances, provide you with Good Reason to terminate employment pursuant to Section 7.

11.

SUCCESSORS.

        Accuride will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of Accuride or any of its subsidiaries to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Accuride or any subsidiary would be required to perform it if no such succession had taken place. Failure of Accuride to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to the compensation described in this Agreement to which you would be entitled hereunder as if you terminate your employment for Good Reason following a Change in Control, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Termination Date. As used in this Agreement, "Accuride" shall mean Accuride as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law or otherwise.

12.

BINDING AGREEMENT.

        This Agreement shall inure to the benefit of and be enforceable by you and your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you should die while any amount would still be payable to you hereunder had you continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate.

13.

NOTICE.

        For purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notices to Accuride shall be directed to the attention of the President of the Company or a member of the Board who is not a Company employee with a copy to the Secretary of Accuride, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

14.

MISCELLANEOUS.

        No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and the President of the Company or a member of the Board who is not a Company employee. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Indiana without regard to its conflicts of law principles. All references to sections of the Securities Exchange Act of 1934 or the Code shall be deemed also to refer to any successor provisions to such sections. Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law. The obligations of the Company that arise prior to the expiration of this Agreement shall survive the expiration of the term of this Agreement.

15.

VALIDITY.

        The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

16.

COUNTERPARTS.

        This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

17.

ALTERNATIVE DISPUTE RESOLUTION.

        (a)    Mediation.    Unless otherwise provided herein (such as in Sections 9 and 10(d)), any and all disputes arising under, pertaining to or touching upon this Agreement or the statutory rights or obligations of either party hereto, shall, if not settled by negotiation, be subject to non-binding mediation before an independent mediator selected by the parties pursuant to Section 17(d). Notwithstanding the foregoing, both you and Accuride may seek preliminary judicial relief if such action is necessary to avoid irreparable damage during the pendency of the proceedings described in this Section 17. Any demand for mediation shall be made in writing and served upon the other party to the dispute, by certified mail, return receipt requested, at the business address of Accuride, or at your last known residence address, respectively. The demand shall set forth with reasonable specificity the basis of the dispute and the relief sought. The mediation hearing will occur at a time and place convenient to the parties in Evansville, Indiana, within 30 days of the date of selection or appointment of the mediator.

        (b)    Arbitration.    In the event that the dispute is not settled through mediation, the parties shall then proceed to binding arbitration before a single independent arbitrator selected pursuant to Section 17(d). The mediator shall not serve as arbitrator. TO THE EXTENT ALLOWABLE UNDER APPLICABLE LAW, ALL DISPUTES INVOLVING ALLEGED UNLAWFUL EMPLOYMENT DISCRIMINATION, BREACH OF CONTRACT OR POLICY, OR EMPLOYMENT TORT COMMITTED BY ACCURIDE OR A REPRESENTATIVE OF ACCURIDE, INCLUDING CLAIMS OF VIOLATIONS OF FEDERAL OR STATE DISCRIMINATION STATUTES OR PUBLIC POLICY, SHALL BE RESOLVED PURSUANT TO THIS POLICY AND THERE SHALL BE NO RECOURSE TO COURT, WITH OR WITHOUT A JURY TRIAL. The arbitration hearing shall occur at a time and place convenient to the parties in Evansville, Indiana, within 30 days of selection or appointment of the arbitrator. If Accuride has adopted a policy that is applicable to arbitrations with executives, the arbitration shall be conducted in accordance with said policy to the extent that the policy is consistent with this Agreement and the Federal Arbitration Act, 9 U.S.C. §§ 1-16. If no such policy has been adopted, the arbitration shall be governed by the National Rules for the Resolution of Employment Disputes of AAA in effect on the date of the first notice of demand for arbitration. The arbitrator shall issue written findings of fact and conclusions of law, and an award, within 15 days of the date of the hearing unless the parties otherwise agree.

        (c)    Damages.    In cases of breach of contract or policy, damages shall be limited to contract damages. In cases of discrimination claims prohibited by statute, the arbitrator may direct payment consistent with the applicable statute. In cases of employment tort, the arbitrator may award punitive damages if proved by clear and convincing evidence. The arbitrator may award attorneys' fees to the prevailing party and assess costs against the non-prevailing party, only in accordance with Section 18 of this Agreement. Issues of procedure, arbitrability, or confirmation of award shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16, except that Court review of the arbitrator's award shall be that of an appellate court reviewing a decision of a trial judge sitting without a jury.

        (d)    Selection of Mediators or Arbitrators.    The parties shall select the mediator or arbitrator from a panel list made available by the AAA. If the parties are unable to agree to a mediator or arbitrator within 10 days of receipt of a demand for mediation or arbitration, the mediator or arbitrator will be chosen by alternatively striking from a list of five mediators or arbitrators obtained by Accuride from AAA. You shall have the first strike.

18.

EXPENSES AND INTEREST.

        If a good faith dispute shall arise with respect to the enforcement of your rights under this Agreement or if any arbitration or legal proceeding shall be brought in good faith to enforce or interpret any provision contained herein, or to recover damages for breach hereof, and you are the prevailing party, you shall recover from the Company any reasonable attorneys' fees and necessary costs and disbursements incurred as a result of such dispute or legal proceeding, and prejudgment interest on any money judgment obtained by you calculated at the rate of interest announced by Citibank from time to time as its prime rate from the date that payments to you should have been made under this Agreement. It is expressly provided that the Company shall in no event recover from you any attorneys' fees, costs, disbursements or interest as a result of any dispute or legal proceeding involving the Company and you.

19.

PAYMENT OBLIGATIONS ABSOLUTE.

        Accuride's obligation to pay you the compensation and to make the arrangements in accordance with the provisions herein shall be absolute and unconditional and shall not be affected by any circumstances; provided, however, that the Company may apply amounts payable under this Agreement to any debts owed to the Company by you on your Termination Date. All amounts payable by the Company in accordance with this Agreement shall be paid without notice or demand. If the Company has paid you more than the amount to which you are entitled under this Agreement, the Company shall have the right to recover all or any part of such overpayment from you or from whomsoever has received such amount.

20.

ENTIRE AGREEMENT.

        This Agreement, the Accuride Corporation Separation Pay Plan, and severance agreement between you and the Company, and any Stock Option Agreements set forth the entire agreement between you and the Company concerning the subject matter discussed in such agreements and supersede all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether written or oral, by any officer, employee or representative of the Company. Any prior agreements or understandings with respect to the subject matter set forth in the aforementioned agreements are hereby terminated and canceled.

21.

DEFERRAL OF PAYMENTS.

        To the extent that any payment under this Agreement, when combined with all other payments received during the year that are subject to the limitations on deductibility under Section 162(m) of the Code, exceeds the limitations on deductibility under Section 162(m) of the Code, such payment shall, in the discretion of the Company, be deferred to the next succeeding calendar year. Such deferred amounts shall be paid no later than the 60th day after the end of such next succeeding calendar year, provided that such payment, when combined with any other payments subject to the Section 162(m) limitations received during the year, does not exceed the limitations on deductibility under Section 162(m) of the Code.

22.

PARTIES.

        This Agreement is an agreement between you and Accuride. In certain cases, though, obligations imposed upon Accuride may be satisfied by a Accuride subsidiary. Any payment made or action taken by a Accuride subsidiary shall be considered to be a payment made or action taken by Accuride for purposes of determining whether Accuride has satisfied its obligations under this Agreement.

        If you would like to participate in this special benefits program, please sign and return the extra copy of this letter which is enclosed.

Sincerely,

William P. Greubel
President & CEO
Accuride Corporation

Enclosure

ACCEPTANCE

        I hereby accept the offer to participate in this special benefit program and I agree to be bound by all of the provisions noted above.

Tier II Employee
Title

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Tier II Employee Change in Control Agreement

EX-10.39

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November 20, 2001

Tier III Employee
Accuride Corporation
7140 Office Circle
Evansville, IN 47715

Change in Control Agreement

Dear Tier III Employee:

        Our Board of Directors believes that it is in the best interests of Accuride Corporation ("Accuride") and its shareholders to take appropriate steps to allay any concerns you may have about your future employment opportunities with Accuride and its subsidiaries (Accuride and its subsidiaries are collectively referred to as the "Company"). As a result, the Board has decided to offer to you the special package of benefits described below.

        Please bear in mind that these benefits are being offered only to a few selected employees and we accordingly ask that you refrain from discussing this special program with others. Also, please note that the special benefits package described below will only be effective if you sign the extra copy of this Change in Control Agreement (the "Agreement") which is enclosed and return it to me on or before December 15, 2001. This Agreement supersedes any other change in control agreements entered into previously by you and the Company, whether written or oral.

1.

TERM OF AGREEMENT.

        This Agreement is effective immediately and will continue in effect for a three-year term, ending on December 31, 2004 (the "Initial Term"). This Agreement will be automatically renewed at the end of the Initial Term for additional terms commencing on each January 1, and ending on the next following December 31 (a "Renewal Term"), unless either party serves notice of desire to terminate or modify this Agreement on the other. Such notice must comply with Section 13 and be given at least six months before the end of the Initial Term or the applicable Renewal Term. If a Change in Control or a Partial Change in Control occurs during the Initial Term or any Renewal Term, the scheduled expiration date of the Initial Term or Renewal Term, as the case may be, shall be extended for a term ending on the 18-month anniversary of the Change in Control or Partial Change in Control. Termination of this Agreement will not reduce or diminish any liabilities that have accrued prior to termination.

2.

SEVERANCE PAYMENT.

        If your employment with the Company is terminated without "Cause" (as defined in Section 8) within 18 months following a Change in Control or Partial Change in Control, you will receive the "Severance Payment" described below. The Severance Payment also will be payable if you terminate your employment for "Good Reason" (as defined in Section 7) within 18 months following a Change in Control or Partial Change in Control.

        The "Severance Payment" is a lump sum payment equal to 100% of your annualized base salary as of the date on which a Change in Control or Partial Change in Control occurs. The Severance Payment shall be reduced by the full amount of any payments to which you may be entitled due to your termination pursuant to any other Company severance policy, any agreement between you and the Company providing for severance, or applicable law.

        The Severance Payment will be paid in one lump sum within 10 days following your termination of employment.

        The Severance Payment will not be payable if your employment is terminated for Cause, if you terminate your employment without Good Reason, or if your employment is terminated by reason of your "Disability" (as defined in Section 10(d)) or your death. In addition, the Severance Payment will not be payable if your employment is terminated by you or the Company for any or no reason before a Change in Control or Partial Change in Control occurs or more than 18 months after a Change in Control or Partial Change in Control has occurred.

        In order to receive the Severance Payment, you must execute a release of known and unknown claims that you may have against the Company. The release shall be in a form reasonably requested by Company.

        The Severance Payment will be payable without regard to whether you look for or obtain alternative employment following your termination of employment with the Company.

3.

ACCELERATION OF OR PAYMENT FOR OPTIONS.

        If an agreement is entered into that will result in a Change in Control or Partial Change in Control, before the Change in Control or Partial Change in Control occurs the Compensation Committee of the Company's Board of Directors will accelerate the exercisability of any options you hold to acquire Company stock in accordance with the acceleration provisions of the 1998 Stock Purchase and Option Plan for Employees of Accuride Corporation and Subsidiaries.

4.

OTHER BENEFITS.

        If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company shall arrange to provide you, for a 12-month period, with disability, accident, dental and group health insurance benefits substantially similar to those which you were receiving immediately prior to your termination. The cost to you of a particular type of benefit (e.g., dental insurance) shall be not more than the cost to you of that particular benefit immediately prior to your termination. The Company may provide the health insurance benefit described under this Section by paying a portion of the premiums you are required to pay for continued health insurance coverage under the Company's health insurance plan pursuant to COBRA. The amount paid by the Company will be equal to the difference between the total COBRA premium and the amount you were required to pay for health insurance immediately prior to your termination.

        Your right to receive continued health insurance benefits pursuant to COBRA shall commence upon the termination of your employment and shall not be extended by your rights under this Agreement.

        Your right to receive all forms of benefits described under this Section 4 shall terminate as soon as you become eligible to receive health care benefits, without exclusion for pre-existing conditions, from any other employer.

5.

RETIREMENT AND SAVINGS PLAN.

        If your employment is terminated by the Company without Cause, or if you terminate your employment for Good Reason, within 18 months following a Change in Control or Partial Change in Control, the Company shall make a payment to you equal to 110% of the amount of any forfeitures that you experience as a result of your termination of employment under any of the Company's pension, or profit sharing plans. If you experience forfeitures under the Accuride Cash Balance Pension Plan the amount of the Company's payment shall be equal to 110% of your unvested "Cash Balance Account" as defined in the Accuride Cash Balance Pension Plan, as it may be amended from time to time. The additional 10% payment provided for in this Section is to compensate you for the loss of the opportunity to defer taxes through a rollover of the forfeited amounts.

6.

CHANGE IN CONTROL AND PARTIAL CHANGE IN CONTROL DEFINED.

        For purposes of this Agreement, the term "Change in Control" shall mean and include (i) any sale, merger, consolidation, tender offer or similar acquisition of shares or other transaction or series of related transactions as a result of which at least a majority of the voting power of the Company is not held, directly or indirectly, by the persons or entities who held the Company's securities with voting power before such transactions or (ii) a sale or other disposition of all or a substantial part of the Company's assets, whether in one transaction or a series of related transactions; provided that, in the event of a transaction under either clause (i) or clause (ii) above, Kohlberg Kravis Roberts & Co. ("KKR") has liquidated at least 50% of its equity investment, as valued at the date of the Change in Control, in the Company for cash consideration.

        For purposes of this Agreement, the term "Partial Change in Control" shall mean and include any transaction described in clause (i) or clause (ii) in the preceding paragraph, but without the proviso that KKR must liquidate 50% of its equity investment, as valued as of the date of the Change in Control, in the Company for cash consideration.

7.

GOOD REASON DEFINED.

        For purposes of this Agreement, "Good Reason" shall have different meanings depending on whether a Change in Control or a Partial Change in Control has occurred. Following a Change in Control, "Good Reason" shall mean the occurrence (without your prior express written consent) of any one of the following acts, or failures to act, unless, in the case of any act or failure to act described in clauses (a), (d), or (e) below, such act or failure to act is corrected by the Company prior to the date of termination specified in the Notice of Termination given by you in respect thereof not later than 60 days after the occurrence of the event that serves as the basis for the Notice of Termination:

        (a)  a significant change in your title, duties or responsibilities from those which are in effect immediately prior to the Change in Control which then results in a diminution in your position with the Company;

        (b)  a material reduction in your annual base salary or annual bonus opportunity as in effect as of the Change in Control unless such reduction is in connection with a general reduction of compensation at the Company affecting at least 90% of the officers of the Company which does not exceed 20% of your annual base salary;

        (c)  the relocation of the Company's principal executive offices to a location more than thirty (30) miles from its location on the date of this Agreement (or, if different, more than thirty (30) miles from where such offices are located immediately prior to any Change in Control) or the Company requiring you to be based anywhere other than the Company's principal executive offices except for required travel on the Company's business to an extent substantially consistent with your business travel obligations as of the date of this Agreement;

        (d)  a reduction in the kind or level of employee benefits to which you are entitled immediately before a Change in Control, with the result that your overall benefit package is significantly reduced;

        (e)  any breach by the Company of any provision of this agreement applicable to it which is material and adverse to you;

        (f)    the failure of the Company to obtain a written agreement reasonably satisfactory to you from any successor to the Company (as described in Section 11) to perform this Agreement.

        If a Partial Change in Control (but not a Change in Control) has occurred, then "Good Reason" shall have the same meaning as in the case of a Change in Control, with the following limitations:

        (x)  A temporary change in your title, duties or responsibilities, as described in (a) above, shall not constitute Good Reason; provided that the change is part of an acceptable written transition plan that includes the following provisions:

        (i)    The transition plan provides that by the end of the transition period you will be employed by the combined entity in a position that is comparable to or better than the position that you held with the Company prior to the Partial Change in Control;

        (ii)  The transition period will last no more than 18 months unless you agree otherwise in writing; and

        (iii)  If you are relocated during the transition period, your compensation and benefits will be adjusted in the same fashion as described in (y) below.

        (y)  Your relocation described in clause (iii) above, will not constitute Good Reason as long as the following requirements are met:

        (i)    Your annualized salary must be no lower than the greater of your annualized base salary at the time of the Partial Change in Control or the annualized base salary of the person who previously had your title and/or responsibilities at the acquiring company;

        (ii)  All moving and relocation expenses will be paid for by the Company or reimbursed on a liberal basis, including a "gross-up" on any taxable expenditures, extended temporary living expenses and participation in home buy-out program that is at least as favorable to you as the Company's current executive home buy-out program;

        (iii)  You will receive a reasonable relocation bonus equal to two-months' salary to deal with incidentals and the inconvenience of moving; and

        (iv)  You will retain current (or similar) benefits and perquisites consistent with your position in the new company including equity incentive awards and a change in control or severance agreement equivalent to other executives in the new company; provided that in the event the new company does not then have change in control agreements for its executives, you and the new company will negotiate in good faith a mutually acceptable change in control agreement for your benefit.

        If any of the criteria in clauses (x) or (y) are not satisfied, you will have the option to elect to terminate employment and receive the full Change in Control package as if you had terminated for Good Reason.

8.

CAUSE DEFINED.

        For purposes of this Agreement, "Cause" shall mean (a) your continued willful failure, neglect or refusal to perform your duties with respect to the Company; (b) conduct by you involving (i) dishonesty, fraud, or breach of trust in connection with your employment or (ii) conduct which would be a reasonable basis for an indictment for a felony or for a misdemeanor involving moral turpitude; (c) your willful and continued failure or refusal to follow material directions of the Board or any other act of insubordination by you; or (d) willful malfeasance or willful misconduct by you which is injurious to the Company, monetarily or otherwise.

9.

CAP ON PAYMENTS.

        (a)    General Rules.    The Internal Revenue Code (the "Code") places significant tax burdens on you and the Company if the total payments made to you due to a Change in Control exceed prescribed limits. For example, if your "Base Period Income" (as defined below) is $100,000, your limit or "Cap" is $299,999. If your "Basic Payments" exceed the Cap by even $1.00, you are subject to an excise tax under Section 4999 of the Code of 20% of all amounts paid to you in excess of $100,000. In other words, if your Cap is $299,999, you will not be subject to an excise tax if you receive exactly $299,999. If you receive $300,000, you will be subject to an excise tax of $40,000 (20% of $200,000). In order to avoid this excise tax and the related adverse tax consequences for the Company, by signing this Agreement you agree that your Basic Payments will not exceed an amount equal to your Cap.

        (b)    Special Definitions.    For purposes of this Section, the following specialized terms will have the following meanings:

        (i)    "Base Period Income".    "Base Period Income" is an amount equal to your "annualized includable compensation" for the "base period" as defined in Sections 280G(d)(1) and (2) of the Code and the regulations adopted thereunder. Generally, your "annualized includable compensation" is the average of your annual taxable income from the Company for the "base period," which is the five calendar years prior to the year in which the Change in Control occurs. These concepts are complicated and technical and all of the rules set forth in the applicable regulations apply for purposes of this Agreement.

        (ii)    "Cap" or "280G Cap".    "Cap" or "280G Cap" shall mean an amount equal to 2.99 times your "Base Period Income". This is the maximum amount which you may receive without becoming subject to the excise tax imposed by Section 4999 of the Code or which the Company may pay without loss of deduction under Section 280G of the Code.

        (iii)    "Basic Payments".    The "Basic Payments" include any "payments in the nature of compensation" (as defined in Section 280G of the Code and the regulations adopted thereunder), made pursuant to this Agreement or otherwise, to you or for your benefit, the receipt of which is contingent on a Change in Control and to which Section 280G of the Code applies.

        (c)    Calculating the Cap.    If the Company believes that these rules will result in a reduction of the payments to which you are entitled under this Agreement, it will so notify you as soon as possible. The Company will then, at its expense, retain a "Consultant" (which shall be a law firm, a certified public accounting firm, and/or a firm of recognized executive compensation consultants) to provide an opinion or opinions concerning whether your Basic Payments exceed the limit discussed above. The Company will select the Consultant.

        At a minimum, the opinions required by this Section must set forth the amount of your Base Period Income, the value of the Basic Payments and the amount and present value of any excess parachute payments.

        If the opinions state that there would be an excess parachute payment, your payments under this Agreement will be reduced to the extent necessary to eliminate the excess such that no excise tax will be payable under Section 4999 of the Code in respect of your Basic Payments. You will be allowed to choose the payment that should be reduced or eliminated, but the payment you choose to reduce or eliminate must be a payment determined by such Consultant to be includable in Basic Payments. You will make your decision in writing and deliver it to the Company within 30 days of your receipt of such opinions. If you fail to so notify the Company, it will decide which payments to reduce or eliminate.

        If the Consultant selected to provide the opinions referred to above so requests in connection with the opinion required by this Section, a firm of recognized executive compensation consultants selected by the Company (which may, be is not required to be, the Consultant) shall provide an opinion, upon which such Consultant may rely, as to the reasonableness of any item of compensation as reasonable compensation for services rendered before or after the Change in Control.

        If the Company believes that your Basic Payments will exceed the limitations of this Section, it will nonetheless make payments to you, at the times stated above, in the maximum amount that it believes may be paid without exceeding such limitations. The balance, if any, will then be paid after the opinions called for above have been received.

        If the amount paid to you by the Company is ultimately determined, pursuant to the opinion referred to above or by the Internal Revenue Service, to have exceeded the limitation of this Section, the excess will be treated as a loan to you by the Company and shall be repayable on the 90th day following demand by the Company, together with interest at the lowest "applicable federal rate" provided in Section 1274(d) of the Code. If it is ultimately determined, pursuant to the opinion referred to above or by the Internal Revenue Service, that a greater payment should have been made to you, the Company shall pay you the amount of the deficiency, together with interest thereon from the date such amount should have been paid to the date of such payment, at the rate set forth above, so that you will have received or be entitled to receive the maximum amount to which you are entitled under this Agreement.

        (d)    Calculations.    All determinations concerning the Cap (as well as any assumptions to be used in making such determinations) shall be made by the Consultant selected pursuant to Section 9(c). The Consultant shall provide you and the Company with a written notice of the Cap. The notice from the Consultant shall include any necessary calculations in support of its conclusions. All fees and expenses of the Consultant shall be borne by the Company.

        As a general rule, the Consultant's determination shall be binding on you and the Company. Section 280G and the excise tax rules of Section 4999, however, are complex and uncertain and, as a result, the Internal Revenue Service may disagree with the Consultant's conclusions. If the Internal Revenue Service determines that the Cap is actually lower than calculated by the Consultant, the Cap will be recalculated by the Consultant. Any payment over that revised Cap will then be paid by you to the Company. If the Internal Revenue Service determines that the actual Cap exceeds the amount calculated by the Consultant, the Company shall pay you any shortage.

        The Company has the right to challenge any determinations made by the Internal Revenue Service. If the Company agrees to indemnify you from any taxes, interest and penalties that may be imposed upon you (including any taxes, interest and penalties on the amounts paid pursuant to the Company's indemnification agreement), you must cooperate fully with the Company in connection with any such challenge. The Company shall bear all costs associated with the challenge of any determination made by the Internal Revenue Service and the Company shall control all such challenges.

        You must notify the Company in writing of any claim or determination by the Internal Revenue Service that, if upheld, would result in the payment of excise taxes. Such notice shall be given as soon as possible but in no event later than 15 days following your receipt of notice of the Internal Revenue Service's position.

        (e)    Effect of Repeal or Inapplicablity.    In the event that the provisions of Sections 280G and 4999 of the Code are repealed without succession, this Section shall be of no further force or effect. Moreover, if the provisions of Sections 280G and 4999 of the Code do not apply to impose the excise tax to payments under this Agreement, then the provisions of this Section shall not apply.

10.

TERMINATION NOTICE AND PROCEDURE.

        Any termination by the Company or you of your employment shall be communicated by written Notice of Termination to you if such Notice of Termination is delivered by the Company and to the Company if such Notice of Termination is delivered by you, all in accordance with the following procedures:

        (a)  The Notice of Termination shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances alleged to provide a basis for termination.

        (b)  Any Notice of Termination by the Company shall be in writing signed by the President of the Company or a member of the Board who is not a Company employee, specifying in detail the basis for such termination.

        (c)  If the Company shall furnish a Notice of Termination for Cause and you in good faith notify the Company that a dispute exists concerning such termination within the 15 day period following your receipt of such notice, you may elect to continue your employment during such dispute. If it is thereafter determined that Cause did exist, your "Termination Date" shall be the earlier of (i) the date on which the dispute is finally determined, either by mutual written agreement of the parties or pursuant to the alternative dispute resolution provisions of Section 17 or (ii) the date of your death. If it is thereafter determined that Cause did not exist, your employment shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such notice.

        (d)  If the Company shall furnish a Notice of Termination by reason of Disability and you in good faith notify the Company that a dispute exists concerning such termination within the 15 day period following your receipt of such notice, you may elect to continue your employment during such dispute. The dispute relating to the existence of a Disability shall be resolved by the opinion of the licensed physician selected by Accuride; provided, however, that if you do not accept the opinion of the licensed physician selected by Accuride, the dispute shall be resolved by the opinion of a licensed physician who shall be selected by you; provided further, however, that if Accuride does not accept the opinion of the licensed physician selected by you, the dispute shall be finally resolved by the opinion of a licensed physician selected by the licensed physicians selected by Accuride and you, respectively. If it is thereafter determined that a Disability did exist, your Termination Date shall be the earlier of (i) the date on which the dispute is resolved or (ii) the date of your death. If it is thereafter determined that a Disability did not exist, your employment shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such notice. For purposes of this Agreement, "Disability" shall mean your inability to perform your customary duties for the Company due to a physical or mental condition that is considered to be of long-lasting or indefinite duration.

        (e)  If you in good faith furnish a Notice of Termination for Good Reason and the Company notifies you that a dispute exists concerning the termination within the 15 day period following the Company's receipt of such notice, you may elect to continue your employment during such dispute. If it is thereafter determined that Good Reason did exist, your Termination Date shall be the earlier of (i) the date on which the dispute is finally determined, either by mutual written agreement of the parties or pursuant to the alternative dispute resolution provisions of Section 17, (ii) the date of your death, or (iii) one day prior to the 18 month anniversary of a Change in Control, and your payments hereunder shall reflect events occurring after you delivered Notice of Termination. If it is thereafter determined that Good Reason did not exist, your employment shall continue after such determination as if you had not delivered the Notice of Termination asserting Good Reason.

        (f)    If you submit a Notice of Termination for Good Reason, and the Company successfully contests the grounds you set forth in such Notice of Termination, at the Company's discretion you may be deemed to have voluntarily terminated your employment other than for Good Reason regardless whether you elect to continue employment pending resolution of the dispute regarding your Notice of Termination.

        (g)  If the Company submits a Notice of Termination for Cause, and you successfully contest the grounds set forth in such Notice of Termination, the Company will be deemed to have terminated you other than by reason of Disability or Cause if you do not elect to continue employment pending resolution of the dispute regarding your Notice of Termination.

        (h)  For purposes of this Agreement, a transfer from Accuride to one of its subsidiaries or a transfer from a subsidiary to Accuride or another subsidiary shall not be treated as a termination of employment. Such a transfer may, however, in certain circumstances, provide you with Good Reason to terminate employment pursuant to Section 7.

11.

SUCCESSORS.

        Accuride will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of Accuride or any of its subsidiaries to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Accuride or any subsidiary would be required to perform it if no such succession had taken place. Failure of Accuride to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to the compensation described in this Agreement to which you would be entitled hereunder as if you terminate your employment for Good Reason following a Change in Control, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Termination Date. As used in this Agreement, "Accuride" shall mean Accuride as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law or otherwise.

12.

BINDING AGREEMENT.

        This Agreement shall inure to the benefit of and be enforceable by you and your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you should die while any amount would still be payable to you hereunder had you continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate.

13.

NOTICE.

        For purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notices to Accuride shall be directed to the attention of the President of the Company or a member of the Board who is not a Company employee with a copy to the Secretary of Accuride, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

14.

MISCELLANEOUS.

        No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and the President of the Company or a member of the Board who is not a Company employee. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Indiana without regard to its conflicts of law principles. All references to sections of the Securities Exchange Act of 1934 or the Code shall be deemed also to refer to any successor provisions to such sections. Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law. The obligations of the Company that arise prior to the expiration of this Agreement shall survive the expiration of the term of this Agreement.

15.

VALIDITY.

        The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

16.

COUNTERPARTS.

        This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

17.

ALTERNATIVE DISPUTE RESOLUTION.

        (a)    Mediation.    Unless otherwise provided herein (such as in Sections 9 and 10(d)), any and all disputes arising under, pertaining to or touching upon this Agreement or the statutory rights or obligations of either party hereto, shall, if not settled by negotiation, be subject to non-binding mediation before an independent mediator selected by the parties pursuant to Section 17(d). Notwithstanding the foregoing, both you and Accuride may seek preliminary judicial relief if such action is necessary to avoid irreparable damage during the pendency of the proceedings described in this Section 17. Any demand for mediation shall be made in writing and served upon the other party to the dispute, by certified mail, return receipt requested, at the business address of Accuride, or at your last known residence address, respectively. The demand shall set forth with reasonable specificity the basis of the dispute and the relief sought. The mediation hearing will occur at a time and place convenient to the parties in Evansville, Indiana, within 30 days of the date of selection or appointment of the mediator.

        (b)    Arbitration.    In the event that the dispute is not settled through mediation, the parties shall then proceed to binding arbitration before a single independent arbitrator selected pursuant to Section 17(d). The mediator shall not serve as arbitrator. TO THE EXTENT ALLOWABLE UNDER APPLICABLE LAW, ALL DISPUTES INVOLVING ALLEGED UNLAWFUL EMPLOYMENT DISCRIMINATION, BREACH OF CONTRACT OR POLICY, OR EMPLOYMENT TORT COMMITTED BY ACCURIDE OR A REPRESENTATIVE OF ACCURIDE, INCLUDING CLAIMS OF VIOLATIONS OF FEDERAL OR STATE DISCRIMINATION STATUTES OR PUBLIC POLICY, SHALL BE RESOLVED PURSUANT TO THIS POLICY AND THERE SHALL BE NO RECOURSE TO COURT, WITH OR WITHOUT A JURY TRIAL. The arbitration hearing shall occur at a time and place convenient to the parties in Evansville, Indiana, within 30 days of selection or appointment of the arbitrator. If Accuride has adopted a policy that is applicable to arbitrations with executives, the arbitration shall be conducted in accordance with said policy to the extent that the policy is consistent with this Agreement and the Federal Arbitration Act, 9 U.S.C. §§ 1-16. If no such policy has been adopted, the arbitration shall be governed by the National Rules for the Resolution of Employment Disputes of AAA in effect on the date of the first notice of demand for arbitration. The arbitrator shall issue written findings of fact and conclusions of law, and an award, within 15 days of the date of the hearing unless the parties otherwise agree.

        (c)    Damages.    In cases of breach of contract or policy, damages shall be limited to contract damages. In cases of discrimination claims prohibited by statute, the arbitrator may direct payment consistent with the applicable statute. In cases of employment tort, the arbitrator may award punitive damages if proved by clear and convincing evidence. The arbitrator may award attorneys' fees to the prevailing party and assess costs against the non-prevailing party, only in accordance with Section 18 of this Agreement. Issues of procedure, arbitrability, or confirmation of award shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16, except that Court review of the arbitrator's award shall be that of an appellate court reviewing a decision of a trial judge sitting without a jury.

        (d)    Selection of Mediators or Arbitrators.    The parties shall select the mediator or arbitrator from a panel list made available by the AAA. If the parties are unable to agree to a mediator or arbitrator within 10 days of receipt of a demand for mediation or arbitration, the mediator or arbitrator will be chosen by alternatively striking from a list of five mediators or arbitrators obtained by Accuride from AAA. You shall have the first strike.

18.

EXPENSES AND INTEREST.

        If a good faith dispute shall arise with respect to the enforcement of your rights under this Agreement or if any arbitration or legal proceeding shall be brought in good faith to enforce or interpret any provision contained herein, or to recover damages for breach hereof, and you are the prevailing party, you shall recover from the Company any reasonable attorneys' fees and necessary costs and disbursements incurred as a result of such dispute or legal proceeding, and prejudgment interest on any money judgment obtained by you calculated at the rate of interest announced by Citibank from time to time as its prime rate from the date that payments to you should have been made under this Agreement. It is expressly provided that the Company shall in no event recover from you any attorneys' fees, costs, disbursements or interest as a result of any dispute or legal proceeding involving the Company and you.

19.

PAYMENT OBLIGATIONS ABSOLUTE.

        Accuride's obligation to pay you the compensation and to make the arrangements in accordance with the provisions herein shall be absolute and unconditional and shall not be affected by any circumstances; provided, however, that the Company may apply amounts payable under this Agreement to any debts owed to the Company by you on your Termination Date. All amounts payable by the Company in accordance with this Agreement shall be paid without notice or demand. If the Company has paid you more than the amount to which you are entitled under this Agreement, the Company shall have the right to recover all or any part of such overpayment from you or from whomsoever has received such amount.

20.

ENTIRE AGREEMENT.

        This Agreement, the Accuride Corporation Separation Pay Plan, any severance agreement between you and the Company, and any Stock Option Agreements set forth the entire agreement between you and the Company concerning the subject matter discussed in such agreements and supersede all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether written or oral, by any officer, employee or representative of the Company. Any prior agreements or understandings with respect to the subject matter set forth in the aforementioned agreements are hereby terminated and canceled.

21.

DEFERRAL OF PAYMENTS.

        To the extent that any payment under this Agreement, when combined with all other payments received during the year that are subject to the limitations on deductibility under Section 162(m) of the Code, exceeds the limitations on deductibility under Section 162(m) of the Code, such payment shall, in the discretion of the Company, be deferred to the next succeeding calendar year. Such deferred amounts shall be paid no later than the 60th day after the end of such next succeeding calendar year, provided that such payment, when combined with any other payments subject to the Section 162(m) limitations received during the year, does not exceed the limitations on deductibility under Section 162(m) of the Code.

22.

PARTIES.

        This Agreement is an agreement between you and Accuride. In certain cases, though, obligations imposed upon Accuride may be satisfied by a Accuride subsidiary. Any payment made or action taken by a Accuride subsidiary shall be considered to be a payment made or action taken by Accuride for purposes of determining whether Accuride has satisfied its obligations under this Agreement.

        If you would like to participate in this special benefits program, please sign and return the extra copy of this letter which is enclosed.

Sincerely,

William P. Greubel
President & CEO
Accuride Corporation

Enclosure

ACCEPTANCE

        I hereby accept the offer to participate in this special benefit program and I agree to be bound by all of the provisions noted above.

Tier III Employee
Title

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Tier III Employee Change in Control Agreement

EX-21.1

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EXHIBIT 21.1

ACCURIDE CORPORATION
LIST OF SUBSIDIARIES

Subsidiary	Jurisdiction of Incorporation
Accuride Canada, Inc.	Canada
Accuride Texas, Inc.	Delaware
Accuride Ventures, Inc.	Delaware
Accuride Henderson Limited Liability Company	Delaware
AKW, L.P.	Delaware
AKW General Partner, L.L.C.	Delaware
Accuride de Mexico, S.A. de C.V.	Mexico
Accuride Cuyahoga Falls, Inc.	Delaware
Accuride S.A. de C.V.	Mexico
Accuride Monterrey S.A. de C.V.	Mexico

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ACCURIDE CORPORATION LIST OF SUBSIDIARIES

EX-23.1

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        EXHIBIT 23.1

INDEPENDENT AUDITORS' CONSENT

        We consent to the incorporation by reference in Registration Statement No. 333-68227 of Accuride Corporation on Form S-8 of our report dated February 11, 2002, appearing in this annual Report on Form 10-K of Accuride Corporation for the year ended December 31, 2001.

Deloitte & Touche LLP
Indianapolis, Indiana

March 11, 2002

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INDEPENDENT AUDITORS' CONSENT