DURA AUTOMOTIVE SYSTEMS INC, S-1/A, 1996-08-07

DURA AUTOMOTIVE SYSTEMS INC
S-1/A, 1996-08-07
METAL FORGINGS & STAMPINGS

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 7, 1996

REGISTRATION NO. 333-06601
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

----------------

AMENDMENT NO. 2
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

----------------

DURA AUTOMOTIVE SYSTEMS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

----------------

DELAWARE 3465 38-2961431
(STATE OR OTHER (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
JURISDICTION OF CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
INCORPORATION OR
ORGANIZATION)

4508 IDS CENTER
MINNEAPOLIS, MINNESOTA 55402
TELEPHONE: (612) 332-2335
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

----------------

DAVID R. BOVEE
DURA AUTOMOTIVE SYSTEMS, INC.
2791 RESEARCH DRIVE, ROCHESTER HILLS, MICHIGAN 48309
TELEPHONE: (810) 299-7500
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)

COPIES TO:
H. KURT VON MOLTKE DEWEY B. CRAWFORD
KIRKLAND & ELLIS GARDNER, CARTON & DOUGLAS
200 EAST RANDOLPH DRIVE 321 NORTH CLARK STREET
CHICAGO, ILLINOIS 60601 CHICAGO, ILLINOIS 60610
(312) 861-2000 (312) 245-8422

----------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [_]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
----------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

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- -------------------------------------------------------------------------------
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC.

Cross Reference Sheet Pursuant to Item 501(b) of Regulation S-K Showing
Location in Prospectus of Information Required by Items of Part I of Form S-1.

<TABLE>
<CAPTION>
REGISTRATION STATEMENT ITEM NUMBER
AND CAPTION CAPTION OR LOCATION IN PROSPECTUS
---------------------------------- ---------------------------------
<C> <S> <C>
1. Forepart of the Registration
Statement and Outside Front
Cover Page of Prospectus...... Outside Front Cover Page of Registration
Statement; Outside Front Cover Page of
Prospectus
2. Inside Front and Outside Back
Cover Pages of Prospectus..... Inside Front Cover Page of Prospectus;
Outside Back Cover Page of Prospectus;
Additional Information
3. Summary Information and Risk
Factors....................... Prospectus Summary; Risk Factors
4. Use of Proceeds................ Prospectus Summary; Use of Proceeds;
Management's Discussion and Analysis of
Results of Operations and Financial
Condition
5. Determination of Offering
Price......................... Outside Front Cover Page of Prospectus;
Underwriting
6. Dilution....................... Dilution
7. Selling Security Holders....... Inapplicable
8. Plan of Distribution........... Outside Front Cover Page of Prospectus;
Underwriting
9. Description of Securities to be
Registered.................... Prospectus Summary; Dividend Policy;
Description of Capital Stock
10. Interests of Named Experts and
Counsel....................... Legal Matters
11. Information with Respect to the
Registrant.................... Outside Front Cover Page of Prospectus;
Prospectus Summary; Risk Factors; The
Company; Use of Proceeds; Dividend Policy;
Dilution; Capitalization; Selected
Consolidated Financial Data; Management's
Discussion and Analysis of Results of
Operations and Financial Condition;
Business; Management; Principal
Stockholders; Certain Transactions;
Description of Capital Stock; Shares
Eligible for Future Sale
12. Disclosure of Commission
Position on Indemnification
for Securities Act
Liabilities................... Inapplicable
</TABLE>
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

SUBJECT TO COMPLETION, DATED AUGUST 7, 1996

PROSPECTUS
, 1996
LOGO

2,700,000 SHARES

DURA AUTOMOTIVE SYSTEMS, INC.
CLASS A COMMON STOCK

All of the shares of Class A Common Stock, par value $.01 per share ("Class A
Common Stock"), offered hereby are being sold by Dura Automotive Systems, Inc.
(the "Company").

Prior to this offering, there has been no public market for other Class A
Common Stock of the Company. It is currently estimated that the initial public
offering price will be between $14.00 and $16.00 per share. See "Underwriting"
for information relating to the factors considered in determining the initial
public offering price.

Application has been made for quotation of the Class A Common Stock on the
Nasdaq National Market under the symbol "DRRA."

Upon completion of the offering contemplated hereby, the Company will have
2,700,000 shares of Class A Common Stock and 4,998,254 shares of Class B Common
Stock, par value $.01 per share ("Class B Common Stock"), outstanding. The
Company's Class A Common Stock and Class B Common Stock are substantially
identical except with respect to voting power and conversion rights. The Class
A Common Stock is entitled to one vote per share and the Class B Common Stock
is entitled to ten votes per share. The Class B Common Stock is convertible at
the option of the holder, and mandatorily convertible upon the transfer thereof
(except to affiliates) and upon the occurrence of certain other events, into
Class A Common Stock on a share-for-share basis. The Class A Common Stock and
Class B Common Stock will generally vote together as a single class on all
matters submitted to a vote of stockholders. Following the completion of the
offering, existing stockholders will retain approximately 97% of the voting
power. See "Description of Capital Stock." A portion of the proceeds from the
offering will be used to repay $4 million of subordinated promissory notes held
by the principal stockholders. See "Use of Proceeds" and "Certain
Transactions."
SEE "RISK FACTORS" BEGINNING ON PAGE 8 OF THIS PROSPECTUS FOR INFORMATION
THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE UNDERWRITING PROCEEDS
TO THE DISCOUNTS AND TO THE
PUBLIC COMMISSIONS(1) COMPANY(2)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share...................................... $ $ $
Total(3)....................................... $ $ $
- --------------------------------------------------------------------------------
</TABLE>
(1) See "Underwriting" for indemnification arrangements with the Underwriters.
(2) Before deducting estimated expenses of $600,000 which will be paid by the
Company.
(3) The Company has granted the Underwriters a 30-day option to purchase up to
405,000 additional shares at the Price to the Public, less Underwriting
Discounts and Commissions, solely to cover over-allotments, if any. If such
option is exercised in full, the total Price to the Public, Underwriting
Discounts and Commissions and Proceeds to the Company will be $ , $
and $ , respectively. See "Underwriting."
The shares offered hereby are offered by the several Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to
their right to reject any order in whole or in part. It is expected that
certificates for the shares will be ready for delivery in New York, New York,
on or about , 1996.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
ROBERT W. BAIRD & CO.
INCORPORATED
<PAGE>

[Diagram of car]

IN CONNECTION WITH THE OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE CLASS A
COMMON STOCK OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE
PREVAIL IN THE OPEN MARKET. SUCH STABILIZING MAY BE EFFECTED ON THE NASDAQ
NATIONAL MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.

2
<PAGE>

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by, and should be read in
conjunction with, the more detailed information and financial statements, and
the related notes thereto, included elsewhere in this Prospectus. As used in
this Prospectus, unless the context otherwise requires, the term "Company"
includes Dura Automotive Systems, Inc. and all of its subsidiaries and its and
their respective predecessors and subsidiaries. Except as otherwise indicated,
(a) all information in this Prospectus assumes (i) that the over-allotment
option granted to the Underwriters is not exercised and (ii) that the
conversion of the Company's existing classes of common stock into shares of
Class B Common Stock and a 17.625 to 1 stock split thereof have occurred and
(b) the information presented herein on a pro forma basis gives effect to the
sale of the net assets of the Company's window regulator business (the "Window
Regulator Business") as if such sale had occurred on January 1, 1995. See "The
Recapitalization" and "The Company." The Class A Common Stock and Class B
Common Stock to be outstanding immediately after completion of the Offering are
collectively referred to herein as the "Common Stock."

THE COMPANY

Dura Automotive Systems, Inc. (the "Company") is a leading designer and
manufacturer of mechanical assemblies and integrated systems for the global
automotive industry. The Company believes that it is the largest supplier of
both parking brake mechanisms and parking brake cables to original equipment
manufacturers ("OEMs") in North America, with market shares of over 60% and
over 40%, respectively. The Company supplies both parking brake mechanisms and
cables, as well as complete parking brake systems, which consist of parking
brake mechanisms and the cables that connect the brake mechanism to the brake
drum. In addition, the Company designs and manufactures a variety of automotive
cables, latches, transmission shifter mechanisms and other mechanical
assemblies. The Company's products are sold to almost every major North
American automotive OEM, including Ford Motor Company ("Ford"), General Motors
Corporation ("GM") and Chrysler Corp. ("Chrysler"), as well as to foreign OEMs
such as Toyota Motor Corp. ("Toyota"). On a pro forma basis, the Company had
revenues of $239.6 million, operating income of $17.2 million and net income of
$7.6 million in 1995.

The Company has supplied parking brake components and automotive cables to
OEMs since 1961 and 1970, respectively, and was granted its first parking brake
patent in 1967. The Company has continually increased its design capabilities,
allowing it to capitalize on the desire of its customers to shift total design
responsibilities to their suppliers. The Company believes it is the only North
American supplier with the capability to design, manufacture and assemble a
complete parking brake system for its customers. As a result of the Company's
significant design, engineering and project management capabilities, the
Company has been designated as the only Full Service Supplier of parking brake
systems to Ford and is the largest supplier of such systems to GM. In 1995, the
Company estimates that it supplied approximately 78% and 93%, respectively, of
Ford's and GM's parking brake mechanism purchases and approximately 88% and
56%, respectively, of Ford's and GM's parking brake cable purchases.

On a pro forma basis, the Company's four largest customers, Ford, GM,
Chrysler and Toyota, accounted for approximately 50%, 37%, 6% and 5%,
respectively, of the Company's 1995 revenues. The Company manufactures products
for many of the most popular car, light truck, sport utility and mini-van
models, including eight of the top ten selling vehicles in the United States
for 1995: the Ford Taurus, Escort, Explorer, Ranger and F-Series pickups, GM
C/K pickups, Saturn and Toyota Camry. The Company is generally the sole
supplier of the parts it sells to OEMs and will ordinarily continue to supply
parts for a particular model for the life of the model, which usually ranges
from three to seven years.

The automotive components supply industry is undergoing significant
consolidation and globalization as OEMs seek to reduce their supplier base. An
important factor in this trend is the OEMs' awarding of sole-source contracts
to full-service suppliers that are capable of manufacturing products in
multiple geographic markets.

3
<PAGE>

The principal objective of the Company is to capitalize on this trend through
both internal development and strategic acquisitions. From an internal
perspective, the Company seeks to utilize its design, engineering and project
management capabilities, as well as its advanced product technology and high-
quality, low-cost manufacturing capabilities, to compete for new business. The
Company competes for new business early in the development of new models and in
the redesign of existing models. The Company has become a long-term preferred
supplier to its major customers and believes that this status provides it with
a strategic advantage in securing new business.

The Company also believes that the continuing trend toward supplier
consolidation provides attractive opportunities to acquire high-quality
companies. The Company's acquisition strategy focuses on identifying companies
whose acquisition will allow the Company to expand into new geographic markets,
add new customers, provide new product, manufacturing and service capabilities
or increase model penetration with existing customers.

The Company was formed by an investor group organized by Hidden Creek
Industries ("Hidden Creek") to acquire the Dura Automotive Hardware and
Mechanical Components divisions (the "Dura Divisions") from Wickes
Manufacturing Company ("Wickes"). Following this acquisition in November 1990,
Hidden Creek hired a new management team that implemented a series of strategic
changes designed to improve product quality and reduce manufacturing costs
through, among other things, the introduction of cellular manufacturing
methods, consolidation of manufacturing facilities, improvement in inventory
management and reduction of scrap. The Company also embarked upon a strategic
acquisition program. In August 1994, the Company combined its operations with
the automotive parking brake cable and lever business and light duty cable
business (the "Brake and Cable Business") of Alkin Co., formerly known as
Orscheln Co. ("Alkin"), which significantly expanded the Company's size and
capabilities. Since that acquisition, the Company has achieved significant cost
savings through the consolidation of manufacturing facilities, sales,
engineering and design functions and the reduction of administrative personnel.
The Company has substantially completed the integration of the Brake and Cable
Business and is now positioned to further expand its capabilities.

The Company's leadership team has an average of 20 years of experience in the
automotive supply industry and has a significant stake in the Company's
success. The Company's management team will beneficially own approximately 13%
of the Common Stock after the Offering. The Company plans to provide further
ownership-related incentives to other managers and salaried and hourly
employees through grants under its 1996 Key Employee Stock Option Plan (the
"Stock Option Plan") and participation in its Employee Stock Discount Purchase
Plan (the "Employee Stock Purchase Plan").

4
<PAGE>

THE OFFERING(1)

<TABLE>
<S> <C>
Class A Common Stock Offered by
the Company...................... 2,700,000 shares
Total Common Stock to be
Outstanding after the Offering:
Class A Common Stock............ 2,700,000 shares
Class B Common Stock............ 4,998,254 shares
----------------
Total (2)..................... 7,698,254 shares
Use of Proceeds................... The net proceeds to be received by the
Company from the Offering will be used to
repay certain outstanding indebtedness of
the Company. See "Use of Proceeds."
Voting Rights..................... Upon completion of the Offering, the
Company will have two classes of
outstanding Common Stock. The Class A
Common Stock and Class B Common Stock are
substantially identical, except with
respect to voting power and conversion
rights. Each holder of Class A Common Stock
is entitled to one vote per share and each
holder of Class B Common Stock is entitled
to ten votes per share, on all matters
submitted to a vote of stockholders. Except
as required by law or in the Company's
Amended and Restated Certificate of
Incorporation (the "Restated Certificate"),
holders of the Class A Common Stock and
Class B Common Stock vote together as a
single class. See "Risk Factors--Control by
Existing Stockholders" and "Description of
Capital Stock."
Proposed Nasdaq National Market
symbol........................... DRRA
</TABLE>
- --------------------
(1) Does not include the Underwriters' over-allotment option granted by the
Company for an aggregate of 405,000 shares of Class A Common Stock.

(2) Does not include 32,045 shares of Class B Common Stock reserved for
issuance upon the exercise of outstanding options as of June 30, 1996 or
1,200,000 shares of Class A Common Stock reserved for issuance under the
Company's Stock Option Plan, Employee Stock Purchase Plan and the
Company's Independent Director Stock Option Plan (the "Director Option
Plan"). See "Management."

5
<PAGE>

SUMMARY FINANCIAL DATA

<TABLE>
<CAPTION>
JUNE 30, 1996
--------------------
AS
ACTUAL ADJUSTED(4)
(IN THOUSANDS)
<S> <C> <C>
BALANCE SHEET DATA (AT END OF PERIOD):
Working capital........................................... $ 14,000 $ 19,373
Total assets.............................................. 139,362 139,362
Long-term debt, net of current maturities................. 40,555 8,863
Total stockholders' investment............................ 32,627 69,692
</TABLE>
- --------------------
(1) In August 1994, the Company acquired the Brake and Cable Business of Alkin
for (i) 2,206,890 shares of Class B Common Stock, (ii) an option to
purchase up to 14,420 additional shares of Class B Common Stock at an
exercise price of $1.45 per share and (iii) cash consideration, net of
assumed indebtedness, of approximately $40 million. The results of
operations of the acquired business have been included in the consolidated
financial statements of the Company from August 31, 1994, the date of
acquisition. In April 1995, the Company sold the net assets of its Window
Regulator Business to Rockwell International Corporation ("Rockwell") for
$18.0 million in cash, resulting in a pretax gain of $4.2 million. The
results of operations of the Window Regulator Business have been included
in the consolidated financial statements of the Company through April 2,
1995, the date of divestiture.
(2) The pro forma statements of operations data for the year ended December 31,
1995 and the six months ended June 30, 1995 give effect to the sale of the
Window Regulator Business as if such sale had occurred on January 1, 1995
and exclude the pretax gain recorded in connection with this transaction.

6
<PAGE>

(3) Gives effect to the recapitalization of the Common Stock, contingent upon
and to occur immediately prior to the consummation of the Offering. See
"The Recapitalization."

(4) Supplemental income per share data has been adjusted to give effect to (i)
the transactions described under "The Recapitalization," and (ii) the
issuance and sale by the Company of 2,700,000 shares of Class A Common
Stock pursuant to the Offering (at an assumed initial public offering price
of $15.00 per share, the midpoint of the range set forth on the cover
hereof) and the application of the net proceeds therefrom as described
under "Use of Proceeds." Net income for the year ended December 31, 1995
was increased by $1,704,000 and net income for each of the six-month
periods ended June 30, 1995 and 1996 was increased by $852,000 to reflect
the reduction of interest expense, net of income taxes, resulting from the
application of the proceeds from the Offering to reduce outstanding
indebtedness.

(5) "EBITDA" is operating income plus depreciation and amortization. EBITDA
does not represent and should not be considered as an alternative to net
income or cash flow from operations as determined by generally accepted
accounting principles. The Company, however, believes it is generally
accepted that EBITDA provides useful information regarding a company's
ability to service and/or incur indebtedness.

7
<PAGE>

RISK FACTORS

This Prospectus contains forward-looking statements that involve risks and
uncertainties. Actual results could differ materially from those discussed in
this Prospectus as a result of the risk factors set forth below and the
matters set forth in the Prospectus generally. The Company cautions the
reader, however, that this list of factors may not be exhaustive. In analyzing
an investment in the Class A Common Stock, prospective investors should
carefully consider, together with the other matters referred to herein, the
risk factors described below.

RELIANCE ON MAJOR CUSTOMERS

On a pro forma basis, the Company's net sales to Ford and GM represented
approximately 50% and 37%, respectively, of the Company's revenues in 1995 and
approximately 41% and 41%, respectively, of the Company's revenues in 1994. In
addition, the Company's top four customers accounted for approximately 98% and
97% of the Company's revenues on a pro forma basis in 1995 and 1994,
respectively. Thus, the loss of Ford, GM or any of the Company's other
significant customers could have a material adverse effect on the Company. See
"Business." The contracts the Company has entered into with many of its
customers provide for supplying the customers' requirements for a particular
model, rather than for manufacturing a specific quantity of products. Such
contracts range from one year to the life of the model, which is generally
three to seven years, and do not require the purchase by the customer of any
minimum number of parts. Therefore, the loss of any one of such customers or a
significant decrease in demand for certain key models or group of related
models sold by any of its major customers could have a material adverse effect
on the Company. The Company also competes to supply parts for successor models
and is subject to the risk that the OEM will not select the Company to produce
parts on a successor model, which could have a material adverse effect on the
Company. The Company is also involved in claims with Ford involving alleged
failures of certain self-adjust parking brakes originally manufactured by the
Brake and Cable Business of Alkin. Ford has maintained that the Company or
Alkin is responsible for all damages or liabilities incurred by Ford as a
result of these claims. As a result of these claims, it is possible that the
Company's relationship with Ford could be adversely affected. See "Business--
Legal Proceedings." There is substantial and continuing pressure from the
major OEMs to reduce costs, including the cost of products purchased from
outside suppliers such as the Company. If the Company were unable to generate
sufficient production cost savings in the future to offset price reductions,
the Company's gross margin could be adversely affected.

RISK OF CUSTOMER LABOR INTERRUPTIONS

Substantially all of the hourly employees of North American OEMs are
represented by the United Automobile, Aerospace and Agricultural Implement
Workers of America (the "UAW") under similar collective bargaining agreements.
The collective bargaining agreements applicable to Ford and GM are both
scheduled to expire in September 1996. The failure of Ford, GM or any other
significant customer of the Company to reach agreement with the UAW relating
to the terms of a new agreement resulting in either a work stoppage or strike
at any of their production facilities could have a material adverse effect on
the Company. In March 1996, GM experienced a 17-day work stoppage due to a
labor dispute between GM and the UAW, which negatively impacted the Company's
results of operations for the first half of 1996. See "Management's Discussion
and Analysis of Results of Operations and Financial Condition."

INDUSTRY CYCLICALITY AND SEASONALITY

The automotive market is highly cyclical and is dependent on consumer
spending. Economic factors adversely affecting automotive production and
consumer spending could adversely impact the Company. In addition, the
Company's business is somewhat seasonal. The Company typically experiences
decreased revenues and operating income during the third calender quarter of
each year due to the impact of OEM plant shutdowns in July for vacations and
new model changeovers. For example, in 1995 the Company experienced a decrease
in revenues and operating income of 17.3% and 65.0%, respectively, between the
second and third quarters. See "Management's Discussion and Analysis of
Results of Operations and Financial Condition--Quarterly Results of Operations
and Seasonality."

8
<PAGE>

FAILURE TO OBTAIN BUSINESS RELATED TO NEW AND REDESIGNED MODEL INTRODUCTIONS

The Company principally competes for new business both at the beginning of
the development of new models and upon the redesign of existing models by its
major customers. New model development generally begins two to five years
prior to the marketing of such models to the public. The failure of the
Company to obtain new business on new models or to retain or increase business
on redesigned existing models could adversely affect the Company.

PRODUCT LIABILITY EXPOSURE

The Company faces an inherent business risk of exposure to product liability
claims in the event that the failure of its products results in personal
injury or death, and there can be no assurance that the Company will not
experience any material product liability losses in the future. In addition,
if any of the Company's products prove to be defective, the Company may be
required to participate in a recall involving such products. In late 1994,
Ford issued a recall of a series of manual-transmission Ford F-Series pickups
to repair the self-adjust parking brakes originally manufactured by the Brake
and Cable Business of Alkin. The Company's share of such costs, which was
fully reserved at the time of the acquisition of the Brake and Cable Business
from Alkin, has reached the full $6.0 million limit agreed to by the Company
and Ford. The Company is also involved in a product recall relating to the
same issue with respect to the Ford Contour/Mystique in Europe. The Company
has agreed to pay 50% of the costs of that recall not to exceed $1 million,
which payments totalled $0.4 million at June 30, 1996. The types of alleged
failures that prompted the F-Series recall have also led to a number of claims
and lawsuits filed against Ford. Currently, two cases are pending directly
against the Company or Alkin relating to personal injury claims, and Ford has
received over 400 claims (generally for property damage) relating to alleged
defects in the self-adjust parking brakes. Ford has maintained that the
Company or Alkin is responsible for all damages or liabilities incurred by
Ford as a result of these claims, and by July 1996, Ford had tendered its
defense of 15 such claims to Dura and Alkin. Dura and Alkin have submitted
these claims to their insurance carriers. The Company maintains insurance
against product liability claims, but there can be no assurance that such
coverage will be adequate for liabilities ultimately incurred or that it will
continue to be available on terms acceptable to the Company. A successful
claim brought against the Company in excess of available insurance coverage or
a requirement to participate in any product recall may have a material adverse
effect on the Company's results of operations or financial condition. See
"Business--Legal Proceedings."

INDUSTRY CONSOLIDATION; RISKS ASSOCIATED WITH FUTURE ACQUISITIONS

The automotive component supply industry has undergone, and is likely to
continue to experience, consolidation, as OEMs seek to reduce costs and reduce
their supplier base. The Company intends to actively pursue acquisition
targets that will allow the Company to expand into new geographic markets, add
new customers, provide new product, manufacturing and service capabilities or
increase model penetration with existing customers. There can be no assurance
that the Company will find attractive acquisition candidates or successfully
integrate acquired businesses into the Company's existing business. If the
expected synergies from such transactions do not materialize or the Company
fails to successfully integrate new businesses into its existing businesses,
the Company's results of operations could be adversely affected. To the extent
that the Company may be considered as an acquisition candidate by a third
party, certain provisions in the Restated Certificate and the Amended and
Restated By-laws ("By-laws") described below may inhibit a change in control
of the Company. See "Anti-Takeover Effects of Certain Charter, By-law and
Statutory Provisions."

DEPENDENCE ON KEY PERSONNEL

The Company's continued success largely will depend on the efforts and
abilities of its executive officers and certain other key employees. The
Company currently does not have employment agreements with any of its
executive officers and other key employees. The Company's operations could be
adversely affected if, for any reason, such executive officers or key
employees do not remain with the Company. See "Management."

9
<PAGE>

COMPETITION

The automotive component supply industry is highly competitive. Some of the
Company's competitors are companies, or divisions or subsidiaries of
companies, that are larger and have greater financial and other resources than
the Company. In addition, with respect to certain of its products, some of the
Company's competitors are divisions of its OEM customers. There can be no
assurance that the Company's products will be able to compete successfully
with the products of these other companies. See "Business--Competition."

IMPACT OF ENVIRONMENTAL REGULATION

The Company is subject to the requirements of federal, state and local
environmental and occupational health and safety laws and regulations. There
can be no assurance that the Company is at all times in complete compliance
with all such requirements. The Company has made and will continue to make
capital and other expenditures to comply with environmental requirements. If a
release of hazardous substances occurs on or from the Company's properties or
any associated offsite disposal location, or if contamination is discovered at
any of the Company's current or former properties, the Company may be held
liable, and the amount of such liability could be material. The Company is
currently involved in environmental proceedings at its Mancelona facility, and
at two landfill sites in Toledo, Ohio. See "Business--Environmental Matters."

CONTROL BY EXISTING STOCKHOLDERS

Upon completion of the Offering, Onex DHC LLC (together with its affiliates,
"Onex"), Alkin and the other existing stockholders will beneficially own all
of the outstanding shares of Class B Common Stock. Each share of Class B
Common Stock has ten votes as compared to one vote for each share of Class A
Common Stock, and thus this amount will represent 94.9% of the combined voting
power of the outstanding Common Stock after the completion of the Offering
(94.2% if the Underwriters' over-allotment option is exercised in full). In
addition, all of the Company's existing stockholders have entered into
agreements to vote their shares for the election of directors designated by
certain of the existing stockholders. As a result of such stock ownership and
voting agreements, the existing stockholders will be able to control the vote
on all matters submitted to a vote of the holders of Common Stock, including
the election of Directors, amendments to the Restated Certificate and the By-
laws and approval of significant corporate transactions. See "Description of
Capital Stock." Such consolidation of voting power could also have the effect
of delaying, deterring or preventing a change in control of the Company that
might be otherwise beneficial to stockholders. See "Principal Stockholders."

DIVIDEND POLICY; RESTRICTIONS ON PAYMENT OF DIVIDENDS

The Company currently intends to retain earnings to support its growth
strategy and does not anticipate paying dividends in the foreseeable future.
As a holding company, the ability of the Company to pay dividends in the
future is dependent upon the receipt of dividends or other payments from its
principal operating subsidiary. The payment of dividends by such subsidiary to
the Company for the purpose of paying dividends to holders of Common Stock is
restricted by the Bank Credit Agreement (as defined). The Company expects that
the New Credit Agreement (as defined) will likewise restrict the payment of
dividends. See "Dividend Policy."

SHARES ELIGIBLE FOR FUTURE SALE; REGISTRATION RIGHTS

No prediction can be made as to the effect, if any, that future sales of
shares of Class A Common Stock or the availability of such shares for future
sale will have on the market price of the Class A Common Stock prevailing from
time to time. Sales of substantial amounts of Class A Common Stock, or the
perception that such sales could occur, could adversely affect prevailing
market prices for the Class A Common Stock. Upon consummation of the Offering,
the Company will have 7,698,254 shares of Common Stock issued and outstanding.
The shares of Class A Common Stock sold in the Offering will be freely
tradeable without restriction or further registration under the Securities Act
of 1933, as amended (the "Securities Act"), unless such shares are acquired by
an "affiliate" of the Company as that term is defined under Rule 144 under the
Securities Act ("Rule 144"). Other than the shares of Class A Common Stock
being offered hereby, the

10
<PAGE>

currently outstanding shares of Common Stock have not been registered under
the Securities Act and may not be sold unless they are registered or unless an
exemption from registration, such as the exemption provided by Rule 144, is
available. Subject to the expiration of certain 180-day "lock up" agreements
described herein, 4,854,317 shares of Class B Common Stock convertible into
shares of Class A Common Stock will be eligible for sale beginning 90 days
from the date of this Prospectus, subject to certain limitations under Rule
144. Beginning 180 days after the date of this Prospectus, the holders of an
aggregate of 4,998,254 shares of Class B Common Stock convertible into shares
of Class A Common Stock will have certain rights to register their shares of
Class A Common Stock under the Securities Act at the Company's expense. See
"Shares Eligible for Future Sale."

ABSENCE OF PUBLIC MARKET; POSSIBLE VOLATILITY OF STOCK PRICE

Prior to the Offering, there has been no public market for the Class A
Common Stock, and there can be no assurance given as to the liquidity of the
trading market for the Class A Common Stock, that an active public market will
develop for the Class A Common Stock or that the Class A Common Stock will
trade in the public market subsequent to the Offering at or above the initial
public offering price. If an active public market for the Class A Common Stock
does not develop, the market price and liquidity of the Class A Common Stock
may be materially adversely affected. The initial public offering price of the
Class A Common Stock will be determined by negotiations between the Company
and the Underwriters and may not be indicative of the market price for the
Class A Common Stock after the Offering. See "Underwriting." The trading price
of the Class A Common Stock could be subject to wide fluctuations in response
to variations in the Company's quarterly operating results, changes in
earnings estimates by analysts, conditions in the Company's businesses or
general market or economic conditions. In addition, in recent years the stock
market has experienced extreme price and volume fluctuations. These
fluctuations have had a substantial effect on the market prices for many
emerging growth companies, often unrelated to the operating performance of the
specific companies. Such market fluctuations could have a material adverse
effect on the market price for the Class A Common Stock.

ANTI-TAKEOVER EFFECT OF CERTAIN CHARTER, BY-LAW AND STATUTORY PROVISIONS

Certain provisions of the Restated Certificate and the By-laws, to be
effective upon consummation of the Offering, may inhibit changes in control of
the Company not approved by the Company's Board of Directors (the "Board").
These provisions include (i) disparate voting rights per share between the
Class A Common Stock and the Class B Common Stock, (ii) a prohibition on
stockholder action through written consents, (iii) a requirement that special
meetings of stockholders be called only by the Board, (iv) advance notice
requirements for stockholder proposals and nominations, (v) limitations on the
ability of stockholders to amend, alter or repeal the By-laws and (vi) the
authority of the Board to issue without stockholder approval preferred stock
with such terms as the Board may determine. The Company will also be afforded
the protections of Section 203 of the Delaware General Corporation Law, which
could have similar effects. See "Description of Capital Stock."

DILUTION TO NEW INVESTORS

Investors purchasing shares of Class A Common Stock in the Offering will
experience immediate and substantial dilution in net tangible book value. See
"Dilution."

11
<PAGE>

THE COMPANY

The Company is a holding company whose predecessor, MC Holding Corp.
("MCHC"), was formed by Hidden Creek, Onex, J2R Corporation ("J2R") and
certain others for the purpose of acquiring the Dura Divisions from Wickes in
November 1990. In August 1994, the Company entered into a transaction that
combined the operations of the Company's operating subsidiary, Dura Operating
Corp., with the Brake and Cable Business of Alkin. In April 1995, the Company
sold all of the assets and liabilities associated with the Window Regulator
Business to Rockwell for $18.0 million in cash, resulting in a pretax gain of
$4.2 million.

The Company was incorporated in Delaware in August 1994. The principal
executive offices of the Company are located at 4508 IDS Center, Minneapolis,
Minnesota 55402, and its telephone number is (612) 332-2335.

USE OF PROCEEDS

The estimated net proceeds to the Company from the sale of 2,700,000 shares
of Class A Common Stock in the Offering (at an assumed initial public offering
price of $15.00 per share), after deducting the estimated offering expenses
and the underwriting discounts, will be approximately $37 million. The Company
expects to use the net proceeds and $2.0 million of additional borrowings
under the revolving credit facility portion of the Credit Agreement dated as
of August 31, 1994, among the Company and certain commercial lending
institutions (the "Bank Credit Agreement"), to repay in full approximately $35
million of a term loan incurred by the Company under the Bank Credit Agreement
and $4.0 million to repay in full the Company's subordinated promissory notes
(the "Notes").

The term loan portion of the Bank Credit Agreement is due in quarterly
installments through June 30, 2001 and the revolving credit facility portion
expires on August 31, 2000. On June 30, 1996, the average interest rates for
borrowings under the term loan and revolving credit facility were 6.7% and
7.2%, respectively.

The Notes mature on December 31, 2001 and bear interest at a fixed rate of
6.93% per annum. The Notes are held by Onex, J2R and Alkin. See "Certain
Transactions."

Following the completion of the Offering, the Company expects to enter into
a new bank credit agreement (the "New Credit Agreement"), providing for
borrowings of up to $50.0 million on more favorable pricing terms than the
Bank Credit Agreement. See "Management's Discussion and Analysis of Results of
Operations and Financial Condition--Liquidity and Capital Resources."

DIVIDEND POLICY

The Company has not declared or paid any dividends on its Common Stock in
the past and currently intends to retain its earnings to support its growth
strategy and does not anticipate paying dividends in the foreseeable future.
As a holding company, the ability of the Company to pay dividends in the
future is dependent upon the receipt of dividends or other payments from its
subsidiaries. Any future payment of dividends is within the discretion of the
Board and will depend upon, among other factors, the capital requirements,
operating results and financial condition of the Company from time to time. In
addition, the Company expects that its ability to pay cash dividends will be
limited by the terms of its New Credit Agreement. See "Management's Discussion
and Analysis of Results of Operations and Financial Condition--Liquidity and
Capital Resources."

12
<PAGE>

THE RECAPITALIZATION

The Company currently has four classes of Common Stock outstanding.
Immediately prior to and contingent upon the Offering, the Company's four
classes of Common Stock will be converted into Class B Common Stock (the
"Recapitalization"). The Class A Common Stock being offered hereby and the
Class B Common Stock will be identical except with respect to voting and
conversion rights. Each share of Class A Common Stock is entitled to one vote
and each share of Class B Common Stock is entitled to ten votes. Except as
otherwise required by law or the Restated Certificate, the Class A Common
Stock and the Class B Common Stock will vote together as a single class on all
matters submitted to a vote of the stockholders, including the election of
Directors. In addition, the Class B Common Stock is convertible at any time at
the option of any holder thereof, and is mandatorily convertible upon any
transfer thereof (except to affiliates) and at any time that the MC
Stockholders and their affiliates, in the aggregate, do not hold at least 10%
of the total outstanding shares of Common Stock, into shares of Class A Common
Stock on a share-for-share basis. All of the Company's existing stockholders
will receive shares of Class B Common Stock in the Recapitalization. The
number of shares of Class B Common Stock that will be issued as a result of
the conversion of the Company's existing classes of Common Stock will be
determined according to the relative preference rankings of such existing
Common Stock and the initial public offering price of the Class A Common
Stock. See "Principal Stockholders."

13
<PAGE>

DILUTION

The net tangible book value (deficit) of the Company as of June 30, 1996 was
$(10.1) million or $(2.02) per share based on 4,998,254 shares of Common Stock
outstanding after giving effect to the Recapitalization. After giving effect
to the sale of shares of Class A Common Stock and the application by the
Company of the net proceeds from the Offering (at an assumed initial public
offering price of $15.00 per share) as set forth under "Use of Proceeds," the
pro forma net tangible book value of the Company at June 30, 1996 would have
been $27.0 million or $3.51 per share of Common Stock outstanding. This
represents an immediate dilution of $11.49 per share to purchasers of shares
at the initial public offering price.

The following table illustrates the per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............. $15.00
Deficit in net tangible book value per share before the
Offering (1)............................................. $(2.02)
Increase in net tangible book value per share attributable
to new investors......................................... 5.53
------
Pro forma net tangible book value per share after the
Offering................................................... 3.51
------
Dilution per share to new investors (2)..................... $11.49
======
</TABLE>
- ---------------------

(1) Net tangible book value (deficit) per share of Common Stock is determined
by dividing the Company's tangible net worth (tangible assets less
liabilities) at June 30, 1996 by the number of shares of Common Stock (of
all classes) that will be outstanding prior to the Offering and after
giving effect to the Recapitalization.
(2) Dilution is computed by subtracting pro forma net tangible book value per
share of Common Stock after the Offering from the assumed initial public
offering price per share.

The following table summarizes, on a pro forma basis at June 30, 1996, the
differences between the number of shares purchased from the Company, the total
consideration given and the average price per share paid by the existing
stockholders and by the new investors purchasing shares of Class A Common
Stock in the Offering.

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
----------------- ------------------- PRICE PER
NUMBER PERCENT AMOUNT PERCENT SHARE
<S> <C> <C> <C> <C> <C>
Current stockholders (1)....... 4,998,254 64.9% $13,733,149 25.3% $ 2.75
New investors.................. 2,700,000 35.1 40,500,000 74.7 15.00
--------- ----- ----------- -----
Total........................ 7,698,254 100.0% $54,233,149 100.0%
========= ===== =========== =====
</TABLE>
- ---------------------

(1) Excludes 32,045 shares of Class B Common Stock reserved for issuance upon
the exercise of options outstanding as of June 30, 1996. Such options
have an exercise price of $1.45 per share.

14
<PAGE>

CAPITALIZATION

The following table sets forth the actual consolidated capitalization of the
Company at June 30, 1996, and as adjusted to give effect to the
Recapitalization and the sale by the Company of the 2,700,000 shares of Class
A Common Stock in the Offering (at an assumed initial public offering price of
$15.00 per share) and the application of the proceeds therefrom (after
deducting the underwriting discounts and estimated expenses of the Offering)
as set forth under "Use of Proceeds." This table should be read in conjunction
with the consolidated financial statements and notes thereto included
elsewhere in this Prospectus.

<TABLE>
<CAPTION>
JUNE 30, 1996
-------------------------
ACTUAL AS ADJUSTED
(IN THOUSANDS,
EXCEPT SHARE AMOUNTS)
<S> <C> <C>
Long-term debt:
Term loan.......................................... $ 35,021 $ --
Revolving credit facility (1)...................... 6,500 8,456
Subordinated promissory notes...................... 4,000 --
Other.............................................. 570 570
Less: current maturities........................... (5,536) (163)
---------- ----------
Total long-term debt............................. 40,555 8,863
---------- ----------
Stockholders' investment:
Old Class A, Class A non-voting, Class B and Class
C Common Stock.................................... 3 --
Preferred stock, $1 par value per share; 5,000,000
shares authorized; none issued or outstanding..... -- --
New Class A Common Stock, $.01 par value per share;
30,000,000 shares authorized; 2,700,000 shares
issued and outstanding on an as adjusted basis.... -- 27
New Class B Common Stock, $.01 par value per share;
10,000,000 shares authorized; 4,998,254 shares
issued and outstanding on an as adjusted basis.... -- 50
Additional paid-in capital......................... 13,571 50,562
Retained earnings.................................. 19,212 19,212
Common stock subscriptions receivable.............. (159) (159)
---------- ----------
Total stockholders' investment................... 32,627 69,692
---------- ----------
Total capitalization........................... $ 73,182 $ 78,555
========== ==========
</TABLE>
- ---------------------

(1) Following the closing of the Offering, and the application of the
proceeds therefrom as described under "Use of Proceeds," the New Credit
Agreement, if entered into, is expected to have maximum availability of
$50.0 million.

15
<PAGE>

SELECTED CONSOLIDATED FINANCIAL DATA

The following table sets forth selected consolidated financial data with
respect to the Company for each of the periods indicated. The selected
historical financial data for the Company for the years ended December 31, 1991
through 1995 have been derived from the Company's consolidated financial
statements which have been audited by Arthur Andersen LLP, independent public
accountants. The data as of and for the six months ended June 30, 1995 and 1996
have been derived from the Company's unaudited consolidated financial
statements which, in the opinion of the Company's management, contain all
adjustments, consisting of normal recurring adjustments, necessary for a fair
presentation of the financial condition and results of operations for these
periods. The results of operations for the six months ended June 30, 1996 are
not necessarily indicative of the results that may be expected for the entire
year. The following pro forma consolidated financial data for the year ended
December 31, 1995 and the six months ended June 30, 1995, which give effect to
the sale of the Window Regulator Business as if such sale had occurred on
January 1, 1995, are presented for informational purposes only and are not
necessarily indicative of the results of the future operations of the Company
or the actual results that would have been achieved had the sale occurred on
such date. The selected historical and pro forma consolidated financial data
should be read in conjunction with "Management's Discussion and Analysis of
Results of Operations and Financial Condition" and the consolidated financial
statements and notes thereto all included elsewhere herein.

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, JUNE 30,
----------------------------------------------------------- ----------------------------
PRO FORMA PRO FORMA
1991 1992 1993 1994 1995 1995(2) 1995 1995(2) 1996
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA(1):
Revenues............... $116,183 $125,412 $129,328 $189,675 $253,726 $239,598 $142,866 $128,738 $127,357
Cost of sales.......... 104,407 115,045 116,961 170,748 220,274 206,953 124,730 111,409 109,141
-------- -------- -------- -------- -------- -------- -------- -------- --------
Gross profit........... 11,776 10,367 12,367 18,927 33,452 32,645 18,136 17,329 18,216
Selling, general and
administrative
expenses.............. 9,464 7,036 8,293 10,362 14,798 14,379 6,745 6,326 7,586
Amortization expense... 436 507 487 690 1,094 1,094 548 548 472
-------- -------- -------- -------- -------- -------- -------- -------- --------
Operating income....... 1,876 2,824 3,587 7,875 17,560 17,172 10,843 10,455 10,158
Interest expense, net.. 1,590 1,268 1,533 3,473 4,822 4,422 2,631 2,231 1,900
Other (income)
expense............... -- 500 -- -- (4,240) -- (4,240) -- --
-------- -------- -------- -------- -------- -------- -------- -------- --------
Income before income
taxes................. 286 1,056 2,054 4,402 16,978 12,750 12,452 8,224 8,258
Provision for income
taxes................. 48 641 936 1,822 6,852 5,148 5,026 3,319 3,304
-------- -------- -------- -------- -------- -------- -------- -------- --------
Net income............. $ 238 $ 415 $ 1,118 $ 2,580 $ 10,126 $ 7,602 $ 7,426 $ 4,905 $ 4,954
======== ======== ======== ======== ======== ======== ======== ======== ========
Pro forma net income
per common and common
equivalent share (3).. $ 2.03 $ 1.52 $ .99
======== ======== ========
Pro forma weighted
average common and
common equivalent
shares outstanding
(3)................... 4,989 4,989 5,026
SUPPLEMENTAL INCOME PER
SHARE DATA(4):
Net income, as
adjusted(4)........... $ 11,830 $ 9,306 $ 5,806
======== ======== ========
Net income per common
and common equivalent
share, as adjusted
(4)................... $ 1.54 $ 1.21 $ .75
======== ======== ========
Weighted average common
and common equivalent
shares outstanding, as
adjusted (4).......... 7,689 7,689 7,726
OTHER DATA:
Net cash provided by
(used in) operating
activities............ $ 2,575 $ 190 $ 3,724 $ (6,156) $ 13,138 $ 16,856 $ 9,583
Net cash provided by
(used in) investing
activities............ (4,961) (5,602) (2,951) (46,878) 11,428 15,692 (2,381)
Net cash provided by
(used in) financing
activities............ 2,386 5,440 (787) 53,037 (22,851) (28,495) (5,695)
EBITDA (5)............. 3,821 5,024 5,996 11,600 23,138 13,809 13,231
Depreciation and
amortization.......... 1,945 2,200 2,409 3,725 5,578 2,966 3,073
Capital expenditures,
net................... 1,650 2,066 2,951 5,406 6,116 2,009 2,076
</TABLE>

16
<PAGE>

<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30, 1996
----------------------------------------- ---------------------
AS
1991 1992 1993 1994 1995 ACTUAL ADJUSTED (4)
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA (AT
END OF PERIOD):
Working capital........ $ 2,796 $ 3,801 $ 3,287 $ 18,631 $ 13,701 $ 14,000 $ 19,373
Total assets........... 51,520 56,213 52,823 159,133 140,531 139,362 139,362
Long-term debt,
net of current
maturities............ 12,823 18,242 16,792 70,112 46,639 40,555 8,863
Total stockholders'
investment............ 3,019 3,327 4,369 17,418 27,683 32,627 69,692
</TABLE>
- ---------------------

(1) In August 1994, the Company acquired the Brake and Cable Business from
Alkin for (i) 2,206,890 shares of Class B Common Stock, (ii) an option to
purchase up to 14,420 additional shares of Class B Common Stock at an
exercise price of $1.45 per share and (iii) cash consideration, net of
assumed indebtedness, of approximately $40 million. The results of
operations of the acquired business have been included in the consolidated
financial statements of the Company from August 31, 1994, the date of
acquisition. Separate statements of operations and cash flows of the Brake
and Cable Business (formerly the "Orscheln Automotive Business Unit") have
been included elsewhere herein for the year ended December 31, 1993 and
the eight-month period ended August 31, 1994. In April 1995, the Company
sold the Window Regulator Business to Rockwell for $18.0 million in cash,
resulting in a pretax gain of $4.2 million. The results of operations of
the Window Regulator Business have been included in the consolidated
financial statements of the Company through April 2, 1995, the date of
divestiture.

(2) The pro forma statement of operations data for the year ended December 31,
1995 and the six-month period ended June 30, 1995 give effect to the sale
of the Window Regulator Business as if such sale had occurred on January
1, 1995 and exclude the pretax gain recorded in connection with this
transaction.
(3) Gives effect to the Recapitalization, contingent upon and to occur
immediately prior to the consummation of the Offering. See "The
Recapitalization."

(4) Supplemental income per share data has been adjusted to give effect to (i)
the Recapitalization and (ii) the issuance and sale by the Company of
2,700,000 shares of Class A Common Stock pursuant to the Offering (at an
assumed initial public offering price of $15.00 per share) and the
application of the net proceeds therefrom as described under "Use of
Proceeds." Net income for the year ended December 31, 1995 was increased
by $1,704,000 and net income for each of the six month periods ended June
30, 1995 and 1996 was increased by $852,000 to reflect the reduction of
interest expense, net of income taxes, resulting from the application of
the proceeds from the Offering to reduce outstanding indebtedness.

17
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION

GENERAL

The Company was organized to effect the acquisition of the Dura Divisions
from Wickes, which was completed in November 1990. In August 1994, the Company
completed the acquisition of the Brake and Cable Business from Alkin. In
connection with the acquisition of the Brake and Cable Business, the Company
entered into certain transition services agreements with Alkin pursuant to
which the Company currently receives data processing and payroll services from
Alkin. Each such agreement is terminable by either party upon 30 to 90 days
notice. The Company's payments to Alkin under such agreements were $1,788,000
in 1995, and the minimum commitment under such agreements will be
approximately $400,000 in 1996. The Company expects to terminate all such
service agreements during 1997 and is in the process of developing internal
replacement systems. In addition, the Company is party to a supply agreement
with Alkin through 1999 pursuant to which each party supplies certain items
necessary for the manufacture of the other party's products. The Company is
required to purchase such supplies from Alkin only so long as the supply terms
remain no less favorable than could be obtained from an independent third
party.

In order to focus on its higher margin products, the Company sold its Window
Regulator Business to Rockwell in April 1995 for $18.0 million in cash,
resulting in a pretax gain of $4.2 million. The results of operations of the
Window Regulator Business have been included in the consolidated financial
statements of the Company through the date of divestiture, April 2, 1995. The
unaudited pro forma data for the year ended December 31, 1995 and the six
months ended June 30, 1995 give effect to the sale of the Window Regulator
Business as if such sale had occurred on January 1, 1995.

The Company ordinarily begins working on products awarded for new or
redesigned models two to five years prior to the marketing of such models to
the public. During such period, the Company incurs (i) costs related to the
design and engineering of such product, (ii) costs related to the production
of the tools and dies used to manufacture the new product and (iii) start-up
costs associated with the initial production of such product. In general,
design and engineering costs are expensed in the period incurred unless they
are reimbursed by the customer, in which case they are capitalized and
amortized over the life of such product. Costs incurred in the production of
the tools and dies are generally capitalized and reimbursed by the customer
prior to production. Start-up costs, which are generally incurred 30 to 60
days immediately prior to and immediately after initial production, are
expensed as incurred.

The following table sets forth the percentage relationship of certain items
to revenues for the periods indicated:

<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
------------------------------ ----------------------
PRO FORMA PRO FORMA
1993 1994 1995 1995 1995 1995 1996
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues................ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales........... 90.4 90.0 86.8 86.4 87.3 86.5 85.7
----- ----- ----- ----- ----- ----- -----
Gross profit........... 9.6 10.0 13.2 13.6 12.7 13.5 14.3
Selling, general and
administrative
expenses............... 6.4 5.4 5.9 6.0 4.7 4.9 5.9
Amortization expense.... 0.4 0.4 0.4 0.4 0.4 0.5 0.4
----- ----- ----- ----- ----- ----- -----
Operating income....... 2.8 4.2 6.9 7.2 7.6 8.1 8.0
Interest expense, net... 1.2 1.8 1.9 1.9 1.9 1.7 1.5
Gain on sale of Window
Regulator Business..... -- -- 1.7 -- (3.0) -- --
----- ----- ----- ----- ----- ----- -----
Income before provision
for income taxes...... 1.6 2.4 6.7 5.3 8.7 6.4 6.5
Provision for income
taxes.................. 0.7 1.0 2.7 2.1 3.5 2.6 2.6
----- ----- ----- ----- ----- ----- -----
Net income ............ 0.9% 1.4% 4.0% 3.2% 5.2% 3.8% 3.9%
===== ===== ===== ===== ===== ===== =====
</TABLE>

18
<PAGE>

COMPARISON OF SIX MONTH PERIOD ENDED JUNE 30, 1996 TO SIX MONTH PERIOD ENDED
JUNE 30, 1995

Revenues. Revenues for the first half of 1996 decreased by $15.5 million, or
10.9%, to $127.4 million from $142.9 million in the same period of 1995. The
divestiture of the Window Regulator Business in April 1995 accounted for $14.1
million of the decrease. The remaining decrease was the result of the decline
in North American automotive production, including the effects of the 17-day
work stoppage at GM in the first quarter of 1996, which adversely impacted the
Company's operations. Total production of cars and light trucks in North
America decreased by approximately 4.0% in the first half of 1996 as compared
to the same period of 1995.

Cost of Sales. Cost of sales for the first half of 1996 decreased by $15.6
million, or 12.5%, to $109.1 million from $124.7 million in the same period of
1995. As a percentage of revenues, cost of sales decreased to 85.7% in the
first half of 1996 from 87.3% in the same period of 1995, resulting in an
improved gross margin of 14.3% in the first half of 1996 from 12.7% in the
same period in 1995. The improvement in gross margin is a result of the
divestiture of the Window Regulator Business, which had lower margins, and the
Company's cost reduction efforts, which included the implementation of more
flexible cellular manufacturing methods and the closing of an underutilized
manufacturing facility.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased by $0.8 million, or 12.5%, to $7.6 million
in the first half of 1996 from $6.8 million for the same period in 1995. The
increase was primarily a result of costs incurred as a result of providing a
greater level of design and engineering services to the Company's customers,
partially offset by the sale of the Window Regulator Business. As a percentage
of revenues, selling, general and administrative expenses increased to 5.9% in
the first half of 1996 from 4.7% for the same period of 1995.

Amortization Expense. Amortization expense decreased to $472,000 in the
first half of 1996 from $548,000 for the same period in 1995. The amortization
expense results from goodwill related to the acquisitions of the Dura
Divisions and the Brake and Cable Business of Alkin in November 1990 and
August 1994, respectively.

Interest Expense. Interest expense for the six months ended June 30, 1996
decreased by $731,000, or 27.8%, to $1.9 million from $2.6 million for the
same period in 1995. The decrease was primarily the result of the repayment of
debt with the net proceeds from the sale of the Window Regulator Business in
April 1995.

Other Income. Other income of $4.2 million for the six months ended June 30,
1995 represents the pre-tax gain on the sale of the Window Regulator Business.
The Company received cash proceeds of $18.0 million from the sale, which were
used to reduce outstanding indebtedness.

Income Taxes. The effective income tax rate for the first half of 1996 was
40.0% compared to 40.4% for the same period in 1995. The effective income tax
rates were higher than federal statutory rates primarily as a result of state
income taxes and nondeductible goodwill amortization.

Net Income. As a result of the foregoing, net income decreased by $2.4
million, or 33.3%, to $5.0 million in the first half of 1996 from $7.4 million
for the same period in 1995.

COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO YEAR ENDED DECEMBER 31, 1994

Revenues. Revenues for 1995 increased by $64.0 million, or 33.8%, to $253.7
million from $189.7 million for 1994. This increase was primarily due to the
full year impact of the August 1994 acquisition of the Brake and Cable
Business of Alkin, which added approximately $100 million of revenues in 1995,
and the addition of approximately $12 million of incremental new business
relating to the liftgate and hood latches for the Ford Taurus/Sable, parking
brakes for the Toyota Avalon and the tailgate latch replacement program for
the Chrysler mini-van, all of which began production in the fourth quarter of
1994 or early 1995. This was partially offset by the April 1995 divestiture of
the Window Regulator Business, which had accounted for $62.1 million of
revenues in 1994 compared to $14.1 million in 1995.

Cost of Sales. Cost of sales for 1995 increased by $49.6 million, or 29.0%,
to $220.3 million from $170.7 million for 1994. As a percentage of revenues,
cost of sales decreased to 86.8% for 1995 from 90.0% for 1994,

19
<PAGE>

resulting in an improved gross margin of 13.2% from 10.0% in the preceding
year. The improvement in gross margin was the result of (i) the divestiture of
the Window Regulator Business, which generated lower margins, (ii) the
synergies resulting from consolidation of the Brake and Cable Business of
Alkin within the Company, (iii) the integration of the Company's business,
which included relocating production activities and the closing of certain
facilities, and (iv) the Company's efforts to improve its production
processes, including the implementation of more flexible cellular
manufacturing techniques. These improvements were partially offset by launch
costs associated with new liftgate and hood latch business on the redesigned
1996 model year Ford Taurus/Sable and the tailgate latch replacement for the
Chrysler mini-van.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased by $4.4 million, or 42.8%, to $14.8 million
for 1995 from $10.4 million for 1994. The increased expenses were the result
of the full year impact of the acquisition of the Brake and Cable Business
from Alkin, as well as costs incurred in providing a greater level of design
and engineering services to the Company's customers. As a percentage of
revenues, selling, general and administrative expenses increased to 5.9% for
1995 from 5.4% for 1994, primarily a result of the increased costs incurred in
providing a greater level of design and engineering services to customers. The
increases were partially offset by reduced costs as a result of the sale of
the Window Regulator Business.

Amortization Expense. Amortization expense increased by $404,000, or 58.6%,
to $1.1 million for 1995 from $690,000 for 1994. The increase was the result
of the full year of amortization related to the acquisition of the Brake and
Cable Business from Alkin.

Interest Expense. Interest expense for 1995 increased by $1.3 million, or
38.8%, to $4.8 million from $3.5 million for 1994. The increase was the result
of increased borrowings in the fourth quarter of 1994 as a result of the
acquisition of the Brake and Cable Business from Alkin. Partially offsetting
this increase was a reduction from the repayment of borrowings upon the sale
of the Window Regulator Business in April 1995.

Other Income. Other income of $4.2 million for 1995 represents the pre-tax
gain on the sale of the Window Regulator Business. The Company received cash
proceeds of $18.0 million from the sale, which were used to reduce outstanding
indebtedness.

Income Taxes. The effective income tax rate for 1995 was 40.4% compared to
41.4% for 1994. The decrease is due principally to the lower percentage impact
of permanent differences on pretax income. The effective rates were higher
than federal statutory rates primarily as a result of state income taxes and
nondeductible goodwill amortization.

Net Income. As a result of the foregoing, net income increased by $7.5
million, to $10.1 million for 1995 from $2.6 million for 1994.

COMPARISON OF YEAR ENDED DECEMBER 31, 1994 TO YEAR ENDED DECEMBER 31, 1993

Revenues. Revenues for 1994 increased $60.4 million, or 46.7%, to $189.7
million from $129.3 million for 1993. Approximately $50 million of the
increase was the result of the August 1994 acquisition of the Brake and Cable
Business from Alkin. The remaining increase was the result of incremental
business that began production in 1994, including the GM Cavalier/Sunfire
transmission shifters and parking brakes, the Ford Continental hood latches,
the Toyota Avalon parking brakes and hood latches and the Chrysler Neon
parking brakes. The Company also benefited from the overall increase in North
American automotive production in 1994.

Cost of Sales. Cost of sales for 1994 increased by $53.7 million, or 46.0%,
to $170.7 million from $117.0 million for 1993. As a percentage of revenues,
cost of sales decreased slightly to 90.0% for 1994 from 90.4% for 1993,
resulting in an improved gross margin of 10.0% from 9.6% in the preceding
year. The improvement was a result of the Company's continuing cost reduction
initiatives and the improvement in fixed cost absorption from higher sales.
Additionally, the Company began to realize cost savings associated with its
integration efforts following the acquisition of the Brake and Cable Business
in the third quarter. These improvements were partially offset by increases in
the cost of certain raw materials used by the Company, including steel.

20
<PAGE>

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased by $2.1 million, or 24.9%, to $10.4 million
for 1994 compared to $8.3 million for 1993. The aggregate amount of selling,
general and administrative expenses increased in 1994 principally as a result
of incremental costs associated with the acquisition of the Brake and Cable
Business from Alkin. As a percentage of revenues, selling, general and
administrative expenses decreased to 5.4% for 1994 from 6.4% for 1993,
primarily due to the consolidation of Alkin's engineering, design and
administrative center into the Company's existing facility.

Amortization Expense. Amortization expense increased by $203,000, or 41.7%,
to $690,000 for 1994 from $487,000 for 1993. The increase was the result of
amortization of goodwill resulting from the August 1994 acquisition of the
Brake and Cable Business.

Interest Expense. Interest expense increased by $2.0 million, to $3.5
million for 1994 from $1.5 million for 1993. The increase is the result of
increased borrowings during 1994, primarily as a result of the indebtedness
incurred to finance the acquisition of the Brake and Cable Business.

Income Taxes. The effective income tax rate decreased to 41.4% for 1994 from
45.6% for 1993. The decrease is due principally to the lower percentage impact
of permanent differences on pretax income. The effective income tax rates were
higher than federal statutory rates primarily as a result of state income
taxes and nondeductible goodwill amortization.

Net Income. As a result of the foregoing, net income increased by $1.5
million, to $2.6 million in 1994 from $1.1 million in 1993.

LIQUIDITY AND CAPITAL RESOURCES

Operating Activities

Net cash provided by (used in) operating activities was $13.1 million,
$(6.2) million and $3.7 million in 1995, 1994 and 1993, respectively. The
changes in cash provided by (used in) operating activities were primarily due
to changes in working capital and improvements in net income. During 1995, the
Company collected certain outstanding receivables related to Brake and Cable
Business pricing matters. This source of cash was offset by reductions in
accrued liabilities and other of $13.3 million, which were primarily due to
payments on product recalls and integration and acquisition obligations.

Net cash provided by operating activities was $9.6 million in the first half
of 1996 compared to $16.9 million in the first half of 1995. The decrease in
net cash provided by operating activities resulted primarily from a net
decrease of $2.5 million in net income and changes in working capital,
particularly a net increase in accounts receivable of $5.8 million in 1996 as
compared to a net decrease of $12.1 million in 1995. During the first half of
1995, the Company collected certain outstanding receivables related to Brake
and Cable Business pricing matters.

Investing and Financing

On August 31, 1994, the Company completed the acquisition of the Brake and
Cable Business for (i) 2,206,890 shares of Class B Common Stock, (ii) an
option to purchase up to an additional 14,420 shares of Class B Common Stock
at an exercise price of $1.45 per share and (iii) cash consideration, net of
assumed indebtedness, of approximately $40 million. In addition to borrowings
under the Bank Credit Agreement, the Company financed a portion of the
acquisition of the Brake and Cable Business by borrowing $4.0 million from
certain stockholders of the Company, including Onex ($1.8 million), J2R ($0.2
million) and Alkin ($2.0 million). See "Certain Transactions."

21
<PAGE>

On April 2, 1995, the Company completed the sale of the Window Regulator
Business for net cash consideration of $18.0 million, resulting in a pretax
gain of $4.2 million.

The Bank Credit Agreement consists of a term loan, which matures on June 30,
2001, of approximately $35 million, and a revolving credit facility of $30.0
million (of which $6.5 million was outstanding as of June 30, 1996) which
expires on August 31, 2000. The Notes mature on December 31, 2001 and bear
interest at a fixed rate of 6.93% per annum. The Notes currently have an
outstanding balance of $4.0 million. The Company intends to use the proceeds
from the Offering, along with the additional $2.0 million borrowed under the
revolving credit facility, to repay the term loan and the Notes. The Bank
Credit Agreement contains various restrictive covenants, which, among other
matters, require the Company to maintain certain financial ratios, including
minimum liquidity, net worth and fixed charge coverage. The Bank Credit
Agreement also limits additional indebtedness, capital expenditures and cash
dividends. The Company was in compliance with all such covenants as of
December 31, 1995 and June 30, 1996. The Company has also entered into an
interest expense limitation agreement ("Cap Agreement") and an interest rate
swap agreement ("Swap Agreement") related to the Bank Credit Agreement. The
Cap Agreement has a notional amount of $10 million and provides for payment to
the Company to offset interest expense should interest rates exceed a defined
level. The Swap Agreement exchanges the variable interest rate on the Bank
Credit Agreement for a fixed rate.

Based upon discussions with its principal lender, following the completion
of the Offering, the Company intends to enter into the New Credit Agreement,
and expects that the New Credit Agreement, which would replace the Bank Credit
Agreement, will provide for borrowings of up to $50.0 million and have a
scheduled maturity in 2001. The Company anticipates the New Credit Agreement
will be secured by all assets of the Company and will generally contain less
restrictive covenants and better pricing terms than the Bank Credit Agreement.
To date, no definitive agreements have been executed and no assurance can be
given that the New Credit Agreement will be executed on such terms or entered
into at all.

The Company's principal source of funds has been, and is anticipated to
continue to be, its cash flows from operations. During 1995, the Company
generated $16.5 million from operations before the effects of changes in
working capital compared to $7.8 million in 1994. The cash generated from
operations combined with the net proceeds of $18.0 million from the sale of
the Window Regulator Business were used to fund capital expenditures of $6.1
million and to reduce outstanding indebtedness by $22.9 million in 1995.

The Company estimates that it will fund approximately $8 million in capital
expenditures in each of 1996 and 1997. These capital expenditures will be used
primarily for the purchase of machinery and equipment to support new business
awards, as well as to finance continued cost reduction efforts.

The Company believes that funds available under the New Credit Agreement,
together with funds generated by the Company's operations, will provide the
Company with sufficient liquidity and capital resources for working capital,
capital expenditures and other needs. However, any significant acquisitions
may require additional debt or equity financing. The Company believes
additional financing will be available from bank lenders, through the issuance
of public or private debt securities or through the additional public
offerings of equity securities.

QUARTERLY RESULTS OF OPERATIONS AND SEASONALITY

The Company typically experiences decreased revenues and operating income
during the third calendar quarter of each year due to production shutdowns at
the automotive manufacturers for model changeovers and vacations. For example,
in 1995 the Company experienced a decrease in revenues and operating income of
17.3% and 65.0%, respectively, between the second and third quarters. See Note
12 of Notes to Consolidated Financial Statements for unaudited quarterly
financial data.

EFFECTS OF INFLATION

Inflation generally affects the Company by increasing the interest expense
of floating rate indebtedness and by increasing the cost of labor, equipment
and raw materials. Management believes that inflation has had an effect on the
Company's business over the past 18 months due to rising labor costs and raw
material costs,

22
<PAGE>

primarily steel, although at a rate below the producer price index. Although
certain of the Company's customer contracts provide that increases in the
Company's cost of raw materials in certain circumstances may be passed through
to its customers, prevailing industry practices have not allowed the Company
to pass such costs on to its customers.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

During the first quarter of 1996, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 121, "Accounting for the Impairment of Long-
Lived Assets and for Long-Lived Assets to Be Disposed Of" which requires
companies to review long-lived assets and certain identifiable intangibles for
impairment whenever events or changes in circumstances indicate that the
carrying amount of such assets may not be recoverable. The adoption of SFAS
No. 121 did not have a significant impact on the financial condition or
results of operations of the Company.

SFAS No. 123, "Accounting for Stock-Based Compensation" encourages, but does
not require, a fair value based method of accounting for employee stock
options, the sale of stock under the Company's Employee Stock Purchase Plan or
similar equity instruments. The Company has elected to continue to measure
compensation cost under Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" as was previously required, and to
comply with pro forma disclosure of net income and earnings per share as if
the fair value based method of accounting had been applied.

23
<PAGE>

BUSINESS

GENERAL

The Company is a leading designer and manufacturer of mechanical assemblies
and integrated systems for the global automotive industry. The Company
believes that it is the largest supplier of both parking brake mechanisms and
parking brake cables to OEMs in North America, with market shares of over 60%
and over 40%, respectively. The Company supplies both parking brake mechanisms
and cables, as well as complete parking brake systems, which consist of
parking brake mechanisms and the cables that connect the brake mechanism to
the brake drum. In addition, the Company designs and manufactures a variety of
automotive cables, latches, transmission shifter mechanisms and other
mechanical assemblies. The Company's products are sold to almost every major
North American automotive OEM, including Ford, GM and Chrysler, as well as to
foreign OEMs such as Toyota. On a pro forma basis, the Company had revenues of
$239.6 million, operating income of $17.2 million and net income of $7.6
million in 1995.

The Company has supplied parking brake components and automotive cables to
OEMs since 1961 and 1970, respectively, and was granted its first parking
brake patent in 1967. The Company has continually increased its design
capabilities, allowing it to capitalize on the desire of its customers to
shift total design responsibilities to their suppliers. The Company believes
it is the only North American supplier with the capability to design,
manufacture and assemble a complete parking brake system for its customers. As
a result of the Company's significant design, engineering and project
management capabilities, the Company has been designated as the only Full
Service Supplier of parking brake systems to Ford and is the largest supplier
of such systems to GM. In 1995, the Company estimates that it supplied
approximately 78% and 93%, respectively, of Ford's and GM's parking brake
mechanism purchases and approximately 88% and 56%, respectively, of Ford's and
GM's parking brake cable purchases.

On a pro forma basis, the Company's four largest customers, Ford, GM,
Chrysler and Toyota, accounted for approximately 50%, 37%, 6% and 5%,
respectively, of the Company's 1995 revenues. The Company manufactures
products for many of the most popular car, light truck, sport utility and
mini-van models, including eight of the top ten selling vehicles in the United
States for 1995: the Ford Taurus, Escort, Explorer, Ranger and F-Series
pickups, GM C/K pickups, Saturn and Toyota Camry. The Company is generally the
sole supplier of the parts it sells to OEMs and will ordinarily continue to
supply parts for a particular model for the life of the model, which usually
ranges from three to seven years.

The Company was formed by an investor group organized by Hidden Creek to
acquire the Dura Divisions from Wickes. Following this acquisition in November
1990, Hidden Creek hired a new management team that implemented a series of
strategic changes designed to improve product quality and reduce manufacturing
costs through, among other things, the introduction of cellular manufacturing
methods, consolidation of manufacturing facilities, improvement in inventory
management and reduction of scrap. The Company also embarked upon a strategic
acquisition program. In August 1994, the Company combined its operations with
the Brake and Cable Business of Alkin, which significantly expanded the
Company's size and capabilities. Since that acquisition, the Company has
achieved significant cost savings through the consolidation of manufacturing
facilities, sales, engineering and design functions and the reduction of
administrative personnel. The Company has substantially completed the
integration of the Brake and Cable Business and is now positioned to further
expand its capabilities.

INDUSTRY TRENDS

The Company's performance and growth is directly related to certain trends
within the automotive market, including the consolidation of the component
supply industry, the growth of system sourcing and the increase in global
sourcing.

24
<PAGE>

Supplier Consolidation. During the 1980s, Ford, GM and Chrysler began to
reduce their supplier base in certain product segments, including mechanical
assemblies, awarding sole-source contracts to full-service suppliers. As a
result, OEMs currently work with a smaller number of full-service suppliers,
each of which supply a greater proportion of the total vehicle. These
requirements can best be met by suppliers with sufficient size and financial
resources to meet such demands. For full-service suppliers such as the
Company, the new environment provides an opportunity to grow by obtaining
business previously provided by other non-full service suppliers and by
acquiring suppliers that further enhance product, manufacturing and service
capabilities. OEMs rigorously evaluate suppliers on the basis of product
quality, cost control, reliability of delivery, product design capability,
financial strength, new technology implementation, quality and condition of
facilities and overall management. Suppliers that obtain superior ratings are
considered for sourcing new business; those that do not may continue their
existing contracts, but normally do not receive additional business. Although
these new supplier policies have already resulted in significant consolidation
of component suppliers in certain segments, the Company believes that
opportunities exist for further consolidation within the Company's segment.
This is particularly true in Europe which has many suppliers in this segment,
each with relatively small market share.

System Sourcing. OEMs increasingly seek suppliers capable of manufacturing
complete systems of a vehicle rather than suppliers who only produce the
separate parts that comprise a system. By outsourcing complete systems, OEMs
are able to reduce their costs associated with the design and integration of
different components and improve quality by enabling their suppliers to
assemble and test major portions of the vehicle prior to beginning production.
The Company has capitalized on this trend by designing its mechanisms and
cable systems to function together and by providing cable and mechanism
designs that are integrated into the design of the entire vehicle. The Company
believes it is the only North American supplier with the capability to design,
manufacture and assemble a complete parking brake system and a complete hood
latch system for its customers.

Global Sourcing. Regions such as Asia, Latin America and Eastern Europe are
expected to experience significant growth in vehicle demand over the next ten
years. OEMs are positioning themselves to reach these emerging markets in a
cost-effective manner by seeking to design and produce "world cars" which can
be designed in one vehicle center but produced and sold in many different
geographic markets, thereby allowing OEMs to reduce design costs and take full
advantage of low-cost manufacturing locations. OEMs increasingly are requiring
their suppliers to have the capability to design and manufacture their
products in different geographic markets.

The Company has formed, or is in the process of forming, strategic alliances
with other suppliers throughout the world, including in Europe, Latin America
and India, and is also exploring opportunities for affiliations in Asia. These
strategic alliances, which range from investments in other manufacturers to
informal understandings, should not only give the Company access to new
geographic markets and customers, but also the capability of offering
complementary products. The Company also has relocated technical personnel
resources to locations in which OEMs will develop "world cars." By
participating in the design of these vehicles and through implementation of
manufacturing processes near the international facilities of the OEMs, the
Company believes it can continue to develop its international presence.

BUSINESS STRATEGY

The principal objective of the Company is to capitalize on opportunities
created by the consolidation of the automotive mechanical assembly industry
and the growth of systems sourcing on a global basis through both internal
development and strategic acquisitions. The key elements of the Company's
strategy include:

Technical Design and Engineering Capabilities. The Company has maintained a
technological advantage through its investment in product development and
advanced engineering. The Company's Advanced Technology Group has developed
many innovative features utilized in the Company's products, including self-
adjust features in parking brakes and automotive cables, vacuum and electric
releasing parking brake mechanisms and selector brackets on transmission
shifters. The Company was the first to provide a brake cable with a ten-year-
life and will manufacture and assemble the industry's first plastic pedal for
the 1998 model year Chrysler

25
<PAGE>

Intrepid/Concorde parking brake. The Company also designed a combination
transmission shifter/four-wheel drive selector into a dual-function unit that
will be manufactured for the 1999 model year Chrysler Grand Cherokee. The
Company works with OEMs throughout the product development process from
concept vehicle and prototype development through the design and
implementation of manufacturing processes. The Company's computer-aided design
systems are compatible with its major customers, enabling the Company to
communicate design developments with customer engineers throughout the design
and development stage.

Efficient Manufacturing/Continuous Improvement Programs. Following the
acquisition of the Dura Divisions, new management implemented a series of
strategic changes designed to improve product quality and reduce manufacturing
costs through, among other things, the introduction of cellular manufacturing
methods, consolidation of manufacturing facilities, improvement in inventory
management and reduction of scrap. The Company has also achieved significant
cost savings subsequent to the acquisition of the Brake and Cable Business by
implementing similar improvements to its operations as well as through the
consolidation of manufacturing facilities and sales, engineering and design
functions and reduction of administrative personnel. As one example of the
efficiency improvements implemented by new management after the acquisition of
the Dura Divisions, the Company increased inventory turnover from fewer than
five times per year as of December 1990 to over 18 times per year as of June
1994. In August 1994, the Company acquired the Brake and Cable Business of
Alkin. Despite the disproportionately higher level of inventories maintained
in the Brake and Cable Business, the Company further increased inventory
turnover to over 20 times per year as of June 1996. The improvements
implemented by management can be further illustrated in the improved gross
margin levels from 10.1% in 1991 to 14.3% for the six months ended June 30,
1996. The Company believes it can continue to improve its manufacturing
processes in the future.

Strategic Acquisitions. The Company believes that the continuing trend
toward supplier consolidation in certain product segments, together with
recent system and global sourcing trends, will provide attractive
opportunities to acquire high-quality companies whose acquisition will allow
the Company to expand into new geographic markets, add new customers, provide
new product, manufacturing and service capabilities or increase model
penetration with existing customers. The Company's acquisition of the Brake
and Cable Business from Alkin is a result of this initiative, providing
additional product capabilities such as automotive cables, enhanced system
capabilities including both mechanisms and cables and new customers such as
Nissan Motor Co. Ltd. The Company currently is targeting acquisitions that
will strengthen its ability to supply its products in Europe and other markets
outside of North America. In addition, the Company also is seeking to acquire
transmission shifter cable technology, which will further enhance the
Company's complete system capabilities. The Company is also focused on
expanding its product lines to include pedal boxes (gas, brake and clutch
pedal units) or other latching mechanisms. The Company is focusing on
automotive assemblies that utilize the Company's assembly and design
capabilities and, preferably, use attaching cables to capitalize on the
Company's system knowledge.

Expanding Customer Relationships. The Company has developed strong customer
relationships based on its long history of high-quality manufacturing,
significant investment in design and engineering capabilities, access to and
relationships with OEMs' engineering and purchasing personnel and ability to
produce complete systems. Strong customer relationships allow the Company to
identify business opportunities and react to customer needs in the early
stages of vehicle design and, therefore, maintain and increase its volume with
particular customers. The Company's strategy is to increase volume by
marketing a broader range of its products to existing customers and by
developing new products that complement its existing product lines. In
addition to its continuing strong relationships with Ford and GM, the Company
has developed a strong relationship with Toyota, which relationship has grown
substantially from limited model coverage in 1991 to a full range of Toyota
vehicles in 1995, including two models manufactured in Japan. The Company has
also experienced significant success at Chrysler in recent months, including
the award of business for the 1998 model year Intrepid/Concorde and the 1999
model year Grand Cherokee. These customer relationships are also expanding
outside the North American market as the Company supplies its products on a
global basis.

Management and Workforce Incentives. The Company's leadership team has an
average of 20 years of experience in the automotive supply industry and has a
significant stake in the Company's success. The

26
<PAGE>

Company's management team will beneficially own approximately 13% of the
Common Stock after the Offering. The Company plans to provide further
ownership-related incentives to other managers and salaried and hourly
employees through grants under the Stock Option Plan and participation in the
Employee Stock Purchase Plan. See "Management."

PRODUCTS

The Company's products consist primarily of parking brake systems,
transmission shifters, automotive cables and latches. The Company's product
offerings include foot and hand operated parking brakes; manual and automatic
floor mounted transmission shifters; parking brake, throttle, oil level, hood
release and fuel door cables; and primary, secondary and combination hood,
deck lid and tail gate latches. The Company offers parking brake and latch
systems (which consist of mechanisms and cables), allowing OEMs to capitalize
on the Company's expertise in manufacturing both components individually and
as an integrated system.

The following table sets forth the approximate composition by product
category of the Company's revenues on a pro forma basis for the last three
fiscal years:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------
PRODUCT CATEGORY 1993 1994 1995
<S> <C> <C> <C>
Parking brakes................................... 52% 45% 40%
Automotive cables................................ -- 27 40
Latches.......................................... 14 9 7
Transmission shifters............................ 9 6 4
Other body hardware.............................. 25 13 9
------- ------- -------
Total.......................................... 100% 100% 100%
======= ======= =======
</TABLE>

CUSTOMERS AND MARKETING

The North American automotive market is dominated by Ford, GM and Chrysler,
with Japanese and foreign manufacturers capturing approximately 26% of the
market. The Company supplies its products primarily to Ford, GM, Chrysler and
Toyota.

The following is a summary of the Company's customers that accounted for at
least 3% of revenues in the past three fiscal years:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------
PRO FORMA
CUSTOMER 1993 1994 1995 1995
<S> <C> <C> <C> <C>
Ford................................................ 46% 57% 52% 50%
GM.................................................. 35 29 35 37
Chrysler............................................ 14 9 6 6
Toyota.............................................. 3 3 5 5
Other............................................... 2 2 2 2
--- --- --- ---
Total............................................. 100% 100% 100% 100%
=== === === ===
</TABLE>

The Company's customers award contracts for a particular car model. Such
contracts range from one year to the life of the model, which is generally
three to seven years, and do not require the purchase by the customer of any
minimum number of parts. The Company also competes for new business to supply
parts for successor models and therefore is subject to the risk that the OEM
will not select the Company to produce parts on a successor model. Because the
Company supplies parts for a broad cross-section of both new and mature
models, its reliance on any particular model is minimized. The Company
manufactures products for many of the most popular car, light truck, sport
utility and mini-van models, including eight of the top ten selling vehicles
in the United States for 1995: the Ford Taurus, Escort, Explorer, Ranger and
F-Series pickups, GM C/K pickups, Saturn and Toyota Camry. Although not
comprehensive, the following table presents an overview of the major models
for which the Company has orders to supply products on current or new model
vehicles:

27
<PAGE>

<TABLE>
<CAPTION>
CUSTOMER CAR MODELS TRUCK MODELS
<S> <C> <C>
Ford............... Contour/Mystique/Mondeo, Aerostar, Bronco, Econoline,
Continental/Town Car, Mark/ Expedition,
Mark VIII, Taurus/Sable, Explorer/Mountaineer, F-
Thunderbird/Cougar Series, Ranger, Villager,
Windstar
GM................. Achieva/Grand Am, Century, Safari/Astro, Blazer/Jimmy,
Corsica/Beretta, Corvette, C/K Truck/Tahoe/Sierra/Yukon,
Deville/Seville, Silhouette/TransSport/Lumina,
Firebird/Camaro, S-10 Pick-up/Sonoma/Bravada,
Lumina/Grand Prix/Regal, Suburban
Aurora/Riviera, Caprice,
Olds 98/Park Avenue, Olds
88/Bonneville/LeSabre, all
Saturn models,
Sunfire/Cavalier
Chrysler........... Intrepid/Concorde, Neon, Caravan, Dakota, Grand
Prowler, Viper Cherokee, Ram Van, Voyager
Toyota............. Avalon, Camry, Corolla, Previa
Lexus, Prizm
</TABLE>

Most of the parts the Company produces have a lead time of two to five years
from product development to production. Examples of recently awarded new
business include parking brakes and hood latches for Ford's 1999 model year
DEW98, parking brakes and parking brake cables for GM's 1999 model year GMT800
Truck, parking brakes, shifters and hood release cables for Chrysler's 1999
model year Grand Cherokee, parking brakes for Chrysler's 1998 model year
Intrepid/Concorde and parking brakes, hood latches and service brake pedals
for Toyota's 1997 model year Previa.

DESIGN AND ENGINEERING SUPPORT

The Company believes that engineering service and support are key factors in
successfully obtaining new business. The Company utilizes program management
with customer-dedicated program teams, which have full design, development,
test and commercial issues under the operational control of a single manager.
In addition, cross-functional teams are established for each new program to
ensure proper management from program conception through product launch.
Advanced technology development is used to maintain product and process
technology for the Company's products, with customers often included in the
product development teams.

The Company's Technical Center is located in Rochester Hills, Michigan,
which is near the development centers of each of the Company's top four
customers. A separate Advanced Technology Group has been established to
maintain the Company's position as a technology leader. The Advanced
Technology Group has developed many innovative features in the Company's
products, many of which features were developed in conjunction with the
Company's customers. The Company utilizes Computer Aided Designs ("CAD") in
the design process, which enables the Company to share data files with its
customers' compatible systems during the design stage, improving function, fit
and performance within the total vehicle. The Company also utilizes CAD links
with its manufacturing facilities to assure manufacturability and quality of
the designs through early involvement of the manufacturing engineers.

The Company has more than 100 patents granted or in the application process.
The patents granted expire over several years commencing in late 1996.
Although the Company believes that, taken together, the patents are
significant, the loss or expiration of any particular patent would not be
material to the Company.

MANUFACTURING

In manufacturing its products, the Company utilizes two different
manufacturing processes, one for mechanisms and one for cables that will
ultimately attach to such mechanisms, creating a system. The Company

28
<PAGE>

utilizes flexible manufacturing cells in both the mechanism and cable assembly
processes. Manufacturing cells are clusters of individual manufacturing
operations and work stations grouped in a cylindrical configuration, with the
operators placed centrally within the configuration. This provides flexibility
by allowing efficient changes to the number of operations each operator
performs. When compared to the more traditional, less flexible assembly line
process, cell manufacturing allows the Company to maintain its production
output consistently with its customers' requirements and reduce the level of
inventory.

Mechanical assemblies consist of between five and 50 individual components,
which are attached to form an integrated mechanism. The Company's assembly
operations are performed on either dedicated, high-volume, automated assembly
machines or on low capital-intensive, flexible, cell-oriented assembly units
capable of low or high volume production runs. The assembly operations
construct the final product through welding, staking and riveting the
component parts. A large portion of the component parts are purchased from
outside suppliers to the Company. However, the Company manufactures its own
stampings, which process consists of passing sheet metal through dies in a
stamping press to form the metal into three-dimensional parts. The Company
produces stamped parts using single-stage and progressive dies in presses,
ranging in size from 150 to 600 tons. Through cell teams, which stress
employee involvement, the Company's processes are continuously upgraded to
increase flexibility, improve operating safety and minimize changeover times
of the dies.

Cables are manufactured using a variety of processes, including plastic
injection molding, extrusion, wire flattening, spring making and zinc
diecasting. Wire is purchased from outside suppliers and then formed into
contra-twisted layers on tubular stranders and bunching machines to produce
19-wire stranded cable. Corrosion resistance is provided by a proprietary,
ceramic coating applied during the stranding process. The cable then is
plastic-coated by an extrusion process to provide a smooth, low coefficient
surface that results in high efficiency and durability. Conduit is then
produced by flattening and coiling wire, which is then extruded with a
protective coating. Proprietary strand and conduit cutting machines enable
efficient processing. Assembly operations are arranged in cells to minimize
inventory, improve quality, reduce scrap, improve productivity and enhance
employee involvement. The cables are assembled with various attachments and
end fittings that allow the customer to install the cables to the appropriate
mating mechanisms.

The Company utilizes frequent communication meetings at all levels of
manufacturing to provide training and instruction as well as to assure a
cohesive, focused effort toward common goals. The Company encourages employee
involvement in all production activity and views such involvement as a key
element toward the success of the Company. The Company also aggressively
pursues involvement from its suppliers, which is necessary to assure a
consistent flow of raw materials and components on a timely basis with
consistently high quality. The Company utilizes the component suppliers where
practical in the design and prototype stages of the new product development to
facilitate the most comprehensive, state-of-the-art designs available. The
Company has made substantial investments in manufacturing technology and
product design capability to support its products, including modern
manufacturing equipment, fineblanking, sophisticated computer-aided design
systems and highly-trained engineering personnel. These advanced capabilities
have helped to further reduce scrap rates, ensure superior product quality and
increase efficiency.

OEMs have established quality rating systems involving rigorous inspections
of suppliers' facilities and operations. OEMs' factory rating programs provide
a quantitative measure of a company's success in improving the quality of its
operations. The Company's facilities in Mancelona, Michigan; Hannibal (South)
and Brookfield, Missouri and Matamoros, Mexico were all certified as Ford Q-1
suppliers, and the Company's remaining plants were in the process of being so
certified, when the automotive industry adopted a quality rating system known
as QS-9000. The Company has completed three of the five phases toward QS-9000
Company-wide registration and expects to complete the remaining phases by the
end of 1996. The Q-1 and QS-9000 awards were designed by OEMs to measure
quality of products and manufacturing systems. The Company believes that
qualifying for such awards will make it more likely that OEMs will purchase
the Company's products.

The Company's plants have been recognized by its customers with various
awards, such as the Chrysler Pentastar Award, GM Target for Excellence, Nummi
Delivery Performance Award, Isuzu Quality Achievement Award and Calsonic
Supplier of the Year Award.

29
<PAGE>

FACILITIES

The following table provides information regarding the Company's principal
facilities. The Company believes that the productive capacity and utilization
of its facilities are sufficient to allow the Company to conduct its
operations in accordance with its business strategy. All of the owned
facilities are subject to liens under the Bank Credit Agreement. The Company
expects that all of the owned facilities will likewise be subject to liens
under the New Credit Agreement.

<TABLE>
<CAPTION>
SQUARE TYPE OF
LOCATION FOOTAGE INTEREST DESCRIPTION OF USE
<S> <C> <C> <C>
Mancelona, Michigan..................... 167,000 Owned Manufacturing
Moberly, Missouri....................... 165,000 Owned Manufacturing
East Jordan, Michigan................... 135,000 Owned Manufacturing
Hannibal, Missouri (South).............. 90,000 Owned Manufacturing
Rochester Hills, Michigan............... 65,000 Leased Product Development/
Operating Headquarters
Hannibal, Missouri (North).............. 64,000 Owned Manufacturing
Brookfield, Missouri.................... 51,000 Owned Manufacturing
Moberly, Missouri(1).................... 46,000 Leased Manufacturing
Matamoros, Mexico....................... 42,000 Owned Manufacturing
Minneapolis, Minnesota.................. 5,700 Leased Corporate Headquarters
</TABLE>
- ---------------------

(1) Will be vacated by July 1, 1997.

Management believes that substantially all of its property and equipment is
in good condition and that it has sufficient capacity to meet its current
manufacturing needs.

COMPETITION

The Company operates in a highly competitive environment. The number of the
Company's competitors has decreased due to the supplier consolidation
resulting from changing OEM policies. The Company currently estimates that it
has over 60% of the North American parking brake market. Its competitors for
parking brakes include Magna International Inc. and Atwood Industries Inc., a
division of Excel Corporation. The Company estimates it has over 40% of the
brake cable market. Dominion Controls Company is the Company's largest
competitor in brake cables. In the hood latch market, the Company estimates it
has approximately 20% of the market. Competitors in the hood latch market
include Magna International Inc. and the Inland Fisher Guide Division of GM.
In the North American shifter market, the Company believes its share is under
5%. The Company's largest competitors in the shifter market are Grand Haven
Stamped Products Co., Sparton Corp. and Atwood Industries Inc.

The Company principally competes for new business both at the beginning of
the development of new models and upon the redesign of existing models. New
model development generally begins two to five years before the marketing of
such models to the public. Once a producer has been designated to supply parts
for a new program, an OEM usually will continue to purchase those parts from
the designated producer for the life of the program, although not necessarily
for a redesign. Competitive factors in the market for the Company's products
include product quality and reliability, cost, timely delivery, technical
expertise and development capability, new product innovation and customer
service.

SUPPLIERS AND RAW MATERIALS

The principal raw materials purchased by the Company are steel, wire and
resin. The types of steel the Company purchases include hot and cold rolled,
galvanized, organically coated and aluminized steel. In general the wire used
by the Company is produced from steel with many of the same characteristics
with the exception that it has a higher carbon content. The Company utilizes
plastic resin to produce the protective coating for its cables. The Company
employs just-in-time manufacturing and sourcing systems enabling it to meet
customer requirements for faster deliveries while minimizing its need to carry
significant inventory levels. The Company has not experienced any significant
shortages of raw materials and normally does not carry inventories of raw
materials or finished products in excess of those reasonably required to meet
production and shipping schedules.

30
<PAGE>

The Company typically negotiates blanket purchase orders or 12-month supply
agreements with integrated steel suppliers, mini-mills and service centers
that have demonstrated timely delivery, quality steel and competitive prices.
These relationships allow the Company to order precise quantities and types of
steel for delivery on short notice, thereby permitting the Company to maintain
low inventories. In addition, the Company occasionally must "spot buy" steel
from service centers to meet unexpected customer demand, engineering changes
or new part tool trials.

Other raw materials purchased by the Company include dies, fasteners,
springs, rivets and rubber products, all of which are available from numerous
sources.

EMPLOYEES

As of June 30, 1996, the Company employed 2,584 persons, 432 of whom are
salaried and the balance of whom are paid on an hourly basis. Approximately
500 employees located at the Company's facilities in Matamoros, Mexico and
East Jordan and Mancelona, Michigan are currently covered by collective
bargaining agreements. The collective bargaining agreement at the Michigan
facilities is with the UAW and expires in December 2000. The collective
bargaining agreement at the Matamoros facility is with the Confederacion de
Trabajadores de Mexico and expires in August 1997. Although management
believes that the Company's relationship with its union employees at these
facilities is good, there can be no assurance that the Company will be able to
negotiate new agreements on favorable terms. In the event the Company is
unsuccessful in negotiating new agreements, these facilities could be subject
to work stoppages, which would have a material adverse effect on the
operations of the Company. The Company has not experienced any work stoppages
and considers its relations with its employees to be good.

ENVIRONMENTAL MATTERS

The Company is subject to the requirements of federal, state, and local
environmental and occupational health and safety laws and regulations. There
can be no assurance that the Company is at all times in complete compliance
with all such requirements. Although the Company has made and will continue to
make capital and other expenditures to comply with environmental requirements,
the Company does not expect to incur material capital expenditures for
environmental controls in 1996 or 1997. If a release of hazardous substances
occurs on or from the Company's properties or any associated offsite disposal
location, or if contamination is discovered at any of the Company's current or
former properties, the Company may be held liable for remediation costs and
expenses, and the amount of such liability could be material.

In 1995, the Michigan Department of Environmental Quality ("MDEQ") requested
that Wickes and the Company investigate environmental conditions at the
Company's Mancelona facility and at certain adjacent property retained by
Wickes. Wickes and the Company jointly completed the requested investigation
and, in January of 1996, submitted the results to MDEQ. The Company is
awaiting MDEQ's response to the sampling results. The Company could incur
additional costs to further investigate or conduct cleanup at the facility. In
1993, the Company received requests for information pursuant to CERCLA from
the U.S. EPA with respect to two landfill sites located in Toledo, Ohio. In
1994, the Company received a notice of potential liability under CERCLA from
the EPA with respect to one of the sites. The Company responded to the
requests and notice by explaining to the EPA that it had no involvement with
these sites, which apparently ceased operations prior to the formation of the
Company in 1990. The Company has received no further communications from the
EPA with respect to either site.

In connection with the Company's acquisition of certain assets from Wickes
in 1990, and subject to certain limitations, Wickes agreed to indemnify the
Company for environmental liabilities arising from the operation of the
acquired facilities prior to the acquisition. The Company and Wickes
subsequently agreed that the Company had provided Wickes with timely and
adequate notice with respect to certain matters (including the matters
described in the immediately preceding paragraph) and that, subject to the
limitations set forth in the agreement, those matters are covered by the
Wickes indemnification. There can be no assurance, however, that all costs
associated with such matters will ultimately be reimbursed by Wickes. The
Company does not currently believe that any liability associated with the
foregoing matters will be material to the Company.

31
<PAGE>

LEGAL PROCEEDINGS

In late 1994, Ford issued a recall of a series of manual-transmission Ford
F-Series pick-ups to repair the self-adjust parking brakes originally
manufactured by the Brake and Cable Business of Alkin. Ford had received
several reports that the brakes failed. Pursuant to a letter agreement entered
into in connection with the acquisition of the Brake and Cable Business, the
Company agreed to reimburse Ford for up to $6.0 million of Ford's costs of the
recall. The Company has reimbursed Ford for the full amount under this
agreement. The Company is also involved in a product recall relating to the
same issue with respect to the Ford Contour/Mystique in Europe. The Company
has agreed to pay 50% of the costs of that recall not to exceed $1.0 million,
which payments totalled $0.4 million as of June 30, 1996.

The type of alleged failures that prompted the F-Series recalls have also
led to a number of claims and lawsuits filed against Ford and, in certain
instances, against the Company and/or Alkin. The Company may be subject to
claims brought directly against the Company by injured occupants of Ford
vehicles and to claims for contribution or indemnification asserted by Ford.
The agreement relating to the acquisition of the Brake and Cable Business
provided that the Company is liable for claims arising out of accidents that
take place on or after August 31, 1994 and that the Company will be liable for
other claims only to the extent any losses by Alkin relating to such claims
are not paid by Alkin's insurance policies (either because they are not over
the deductible amount, because Alkin's policy limits have been exceeded or
because they are not covered by Alkin's insurance policies for other reasons).
Two cases are currently pending directly against the Company or Alkin relating
to personal injury claims, and Ford has received over 400 claims (generally
for property damage) relating to alleged defects in the self-adjust parking
brakes. Ford has maintained that the Company or Alkin is responsible for all
damages or liabilities arising out of these claims. The Company disputes this
position. By July 1996, Ford had tendered its defense of 15 such claims to
Dura and Alkin, and indicated that it would look to Dura and Alkin for
indemnification were Ford ultimately found to be liable and required to make
any payments relating to such claims. Dura and Alkin have submitted these
claims to their insurance carriers. The Company has attempted to work together
with Ford to address the claims arising from the self-adjust parking brakes
originally manufactured by the Brake and Cable Business of Alkin and does not
believe that these claims have adversely affected its business relationship
with Ford.

From time to time, in the ordinary course of its business, the Company
receives notice from a customer that a product may not be properly
functioning. For example, in November 1995, the Company was notified by
Chrysler that it had received reports of a number of parking brake failures in
manual transmission vehicles, particularly in Europe. The Company's
investigation of this matter remains in preliminary stages, and the Company
has had no further contacts from Chrysler regarding this matter. It is
possible that Chrysler could seek contribution from the Company for costs it
incurs if a recall were undertaken or for costs associated with possible
repairs.

In January 1996, the Company was served with a complaint alleging a wrongful
death as the result of injuries purportedly caused by a defectively-designed
manual release for an emergency brake on a 1990 Cadillac Fleetwood. The
lawsuit is in preliminary stages and has been referred to the Company's
insurance carrier.

In June 1996, the Company was served with a complaint alleging a wrongful
death as the result of injuries purportedly caused by a defectively designed
rear latch on a Chrysler mini-van. Chrysler and two other suppliers to
Chrysler were also named as defendants in the complaint. The lawsuit is in
preliminary stages and has been referred to the Company's insurance carrier.
In addition, Chrysler has agreed to assume the defense of, and to indemnify
the Company with respect to, this claim as long as the plaintiffs do not make
any claim alleging a manufacturing defect as it relates to the Company. There
can be no assurance that the plaintiffs will not make such an allegation.

The Company believes it maintains adequate insurance, including product
liability coverage, to cover the claims described above. The Company has also
established reserves in amounts it believes adequate to cover any adverse
judgments. However, any adverse judgment in excess of its insurance coverage
and such reserves could result in a material adverse effect on the Company.

32
<PAGE>

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth certain information with respect to the
Directors and executive officers of the Company:

<TABLE>
<CAPTION>
NAME AGE POSITION(S)
<S> <C> <C>
S.A. (Tony) Johnson............ 56 Chairman and Director
President, Chief Executive Officer and
Karl F. Storrie................ 58 Director
David R. Bovee................. 46 Vice President, Chief Financial Officer and
Assistant Secretary
Joe A. Bubenzer................ 44 Senior Vice President
Robert R. Hibbs................ 34 Vice President and Director
David P. Klosterman............ 59 Vice President
John J. Knappenberger.......... 49 Vice President
Milton D. Kniss................ 48 Vice President
Craig L. Lamiman............... 41 Vice President
Scott D. Rued.................. 39 Vice President
Neil Anderson.................. 45 Director
W. H. Clement.................. 68 Director
James L. O'Loughlin............ 52 Director
William L. (Barry) Orscheln.... 45 Director
Eric J. Rosen.................. 35 Director
Barbara A. Westhues............ 35 Director
</TABLE>

S.A. (Tony) Johnson has served as Chairman and a Director of the Company
since November 1990. Mr. Johnson is the founder, Chief Executive Officer and
President of Hidden Creek, a private industrial management company based in
Minneapolis, Minnesota, which has provided certain management and other
services to the Company. Mr. Johnson is also the President of J2R. Prior to
forming Hidden Creek, Mr. Johnson served from 1985 to 1989 as Chief Operating
Officer of Pentair, Inc., a diversified industrial company. From 1981 to 1985,
Mr. Johnson was President and Chief Executive Officer of Onan Corp., a
diversified manufacturer of electrical generating equipment and engines for
commercial, defense and industrial markets. Mr. Johnson served as Chairman and
a director of Automotive Industries Holding, Inc., a supplier of interior trim
components to the automotive industry, from May 1990 to August 1995. Mr.
Johnson is also Chairman and a director of Tower Automotive, Inc., a
manufacturer of engineered metal stampings and assemblies for the automotive
industry.

Karl F. Storrie has served as President, Chief Executive Officer and a
Director of the Company since March 1991. Prior to joining the Company and
from 1986, Mr. Storrie was Group President of a number of aerospace
manufacturing companies owned by Coltec Industries, a multi-divisional public
corporation. Prior to becoming a Group President, Mr. Storrie was a Division
President of two aerospace design and manufacturing companies for Coltec
Industries from 1981 to 1986. During his thirty-five year career, Mr. Storrie
has held a variety of positions in technical and operations management. Mr.
Storrie is also a director of Argo-Tech Corporation, a manufacturer of
aircraft fuel, boost and transfer pumps.

David R. Bovee has served as Vice President and Chief Financial Officer of
the Company since November 1990. Mr. Bovee also serves as Assistant Secretary
for the Company. Prior to joining the Company, Mr. Bovee served as Vice
President at Wickes in its Automotive Group from 1987 to 1990.

Joe A. Bubenzer has served as Vice President Sales/Engineering since joining
the Company in October 1993 and was named Senior Vice President in 1995. Prior
to joining the Company, Mr. Bubenzer filled various executive positions with
ITT Automotive, a supplier of components to the automotive industry, where he
worked for six years, and, prior to such time, at GM, where he worked for 14
years.

Robert R. Hibbs has served as a Director of the Company since August 1994
and as Vice President since November 1990. Mr. Hibbs, a stockholder of J2R,
has also served as Vice President-Corporate Development of

33
<PAGE>

Hidden Creek since January 1994 and as its Director from April 1990 through
December 1993. Prior thereto, Mr. Hibbs worked in the corporate finance area
with Drexel Burnham Lambert, an investment banking firm, in New York from 1988
to 1990. Mr. Hibbs is also Chairman of the Audit Committee of the Board.

David P. Klosterman has served as Vice President of Advanced Technology
Development since September 1994. Mr. Klosterman served as Vice President of
Engineering for Alkin since December 1991 and prior thereto served as General
Manager of Engineering for Orscheln since January 1979.

John J. Knappenberger has served as Vice President of Quality and Materials
of the Company since December 1995. Prior to joining the Company, Mr.
Knappenberger was Director of Quality for Carrier Corporation's North American
Operations, manufacturers of heating and air conditioning systems, from
February 1992. From 1985 to 1991, Mr. Knappenberger was employed by TRW Inc., a
supplier of components to the automotive industry, beginning as Director of
Quality in 1985 for the Steering and Suspension Division and becoming Vice
President, Quality for the Automotive Sector in 1990.

Milton D. Kniss has served as Vice President of Operations of the Company
since January 1994. From April 1991 until January 1994, Mr. Kniss served as
Director of Michigan Operations for the Company. Mr. Kniss joined the
predecessor in 1981 as a Divisional Purchasing Manager, served as Plant Manager
of East Jordan, Michigan from 1982 until 1986, and Plant Manager of
Gordonsville, Tennessee until 1991.

Craig L. Lamiman has served as Vice President of the Company since August
1994. Prior to joining the Company, Mr. Lamiman served as Director of
Industrial Relations at United Technologies Corporation, a diversified
publicly-held corporation, and President and CEO of his own company in
Connecticut. Mr. Lamiman served in several positions while at Pepsico, Inc.
from 1980 to 1988, the most recent being as Regional Personnel Director for
Pepsi-Cola International Limited (U.S.A.).

Scott D. Rued has served as Vice President of the Company since November
1990. Mr. Rued, a stockholder of J2R, has also served as Executive Vice
President and Chief Financial Officer of Hidden Creek since January 1994 and
served as its Vice President--Finance and Corporate Development from June 1989
through 1993. Mr. Rued has served as Vice President, Corporate Development and
a director of Tower Automotive, Inc. since April 1993. Mr. Rued served as Vice
President, Chief Financial Officer and a director of Automotive Industries
Holding, Inc. from April 1990 to August 1995. Mr. Rued is also a director of
The Rottlund Company, Inc., a corporation engaged in the development and sale
of residential real estate.

Neil Anderson has served as a Director of the Company since August 1994. Mr.
Anderson has also served as Vice President of Finance for Orscheln Management
Co. since March 1991 and was named Senior Vice President of Finance in October
1995. Mr. Anderson has also served as a director for Analytical Bio Chemistry
Laboratories, Inc. since June 1995.

W. H. Clement has served as a Director of the Company since 1993. Mr. Clement
serves as a consultant to Hidden Creek. From 1975 until May 1994, Mr. Clement
served as Chief Executive Officer or as President of Automotive Industries
Holding, Inc. and its predecessor. Mr. Clement is also a director of F&M
National Corporation, a bank holding company, and Tower Automotive, Inc.

James L. O'Loughlin has served as a Director of the Company since August
1994. Mr. O'Loughlin has also served as Vice President and General Counsel to
Orscheln Management Co. since December 1987 and was named Senior Vice President
in October 1995.

William L. (Barry) Orscheln has served as a Director of the Company since
August 1994. Mr. Orscheln has also served as President of Alkin (and its
predecessors) since March 1994, as President of Orscheln Farm and Home since
September 1995, as President of Orscheln Properties Co., L.L.C., since October
1994 and as President of Orscheln Management Co. since December 1987. Mr.
Orscheln has served as a director of UMB Bank, a bank holding company, since
July 1989 and as a director of Orscheln Management Co. since 1987.

Eric J. Rosen has served as a Director of the Company since January 1995. Mr.
Rosen is Managing Director of Onex Investment Corp., a diversified industrial
corporation and an affiliate of Onex, and served as a Vice

34
<PAGE>

President of Onex Investment Corp. from 1989 to February 1994. Prior thereto,
Mr. Rosen worked in the merchant banking group at Kidder, Peabody & Co.
Incorporated from 1987 to 1989. Mr. Rosen is also a director of Tower
Automotive, Inc.

Barbara A. Westhues has served as a Director of the Company since August
1994. Ms. Westhues has served on the Audit Committee since August 1994. Ms.
Westhues has also served as the Controller of Orscheln Management Co. since
December 1987 and was named Senior Vice President in October 1995.

The Company currently has nine Directors, all of whom were elected pursuant
to the terms of the Stockholders Agreement. Promptly following consummation of
the Offering, the Company intends to appoint two additional Directors who are
not otherwise affiliated with the Company or any of its stockholders. Such
nominees have not been selected as of the date hereof. Each Director is
elected to serve until the next annual meeting of stockholders or until a
successor is duly elected and qualified. Executive officers of the Company are
duly elected by the Board to serve until their respective successors are
elected and qualified. There are no family relationships between any of the
Directors or executive officers of the Company.

The Company has letter agreements with Messrs. Lamiman, Klosterman and
Knappenberger with respect to their employment with the Company. The
agreements provide for an annual base salary of $125,000 for Mr. Lamiman,
$95,000 for Mr. Klosterman and $135,000 for Mr. Knappenberger. The agreements
provide that each individual is eligible for an annual bonus of up to 50% of
his annual base salary and certain other benefits customary for agreements of
this type.

Certain of the Company's existing stockholders have entered into agreements
pursuant to which such stockholders have agreed to vote their shares of the
Company's voting stock for the election of directors designated by certain of
the existing stockholders. See "--Stockholders Agreement."

There are three Committees of the Board: the Executive Committee, the
Compensation Committee and the Audit Committee. The Executive Committee, which
is currently composed of Messrs. Johnson, Storrie and Orscheln, exercises the
powers of the Board of Directors during intervals between Board meetings and
acts as an advisory body to the Board by reviewing various matters prior to
their submission to the Board. The Compensation Committee, which is currently
composed of Messrs. Johnson and Orscheln, reviews and makes recommendations to
the Board of Directors regarding salaries, compensation and benefits of
executive officers and key employees of the Company and grants all options to
purchase Common Stock of the Company. The Audit Committee is currently
composed of Messrs. Hibbs, Clement, Anderson and Rosen and Ms. Westhues. Among
other duties, the Audit Committee reviews the internal and external financial
reporting of the Company, reviews the scope of the independent audit and
considers comments by the auditors regarding internal controls and accounting
procedures and management's response to these comments. The Company does not
have a nominating committee. The Company intends to appoint one of the new
independent directors to each of the Audit Committee and the Compensation
Committee.

DIRECTOR COMPENSATION

Directors who are not employees of the Company or any of its affiliates each
receive an annual fee of $14,400 for serving as a director of the Company. In
addition, each non-employee director receives $1,000 for each Board of
Directors meeting attended, $500 for each committee meeting attended and
reimbursement of out of pocket expenses incurred to attend such meetings.

EXECUTIVE COMPENSATION

The following table sets forth certain information for the Company's chief
executive officer and its four other most highly compensated executive
officers (the "Named Executive Officers") for 1995. The Named Executive
Officers did not exercise and were not granted any stock options in 1995 and
did not hold any stock options as of December 31, 1995.

35
<PAGE>

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-----------------------------------
OTHER ANNUAL ALL OTHER
SALARY BONUS COMPENSATION COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($)(1) ($)(1) ($)(2) ($)(3)
<S> <C> <C> <C> <C> <C>
Karl F. Storrie............... 1995 $258,340 $260,000 $11,775 $3,600
President and Chief Executive
Officer
Joe A. Bubenzer............... 1995 157,333 120,000 8,322 2,616
Senior Vice President
David R. Bovee................ 1995 130,833 100,000 4,389 2,832
Vice President
Milton D. Kniss............... 1995 122,000 86,000 6,250 2,776
Vice President
Craig L. Lamiman.............. 1995 125,000 28,000 8,417 231
Vice President
</TABLE>
- ---------------------
(1) Includes amounts deferred by employees under the Company's 401(k) employee
savings plan.
(2) Includes the value of personal benefits and perquisites.
(3) Includes the dollar value of premiums paid by the Company for term life
insurance on behalf of the Named Executive Officers and the Company's
matching 401(k) contributions.

1996 KEY EMPLOYEE STOCK OPTION PLAN

Prior to consummation of the Offering, the Board and stockholders of the
Company will approve the Stock Option Plan. The Stock Option Plan will be
administered by a Compensation Committee (the "Committee") composed of non-
management members of the Board, who will be appointed by the Board. Certain
people who are full-time, salaried employees of the Company will be eligible
to participate in the Stock Option Plan (an "Employee Participant"). The
Committee will select the Employee Participants and determine the terms and
conditions of the options. The Stock Option Plan will provide for the issuance
of options to Employee Participants covering 600,000 shares of Class A Common
Stock of the Company, subject to certain adjustments reflecting changes in the
Company's capitalization.

Options granted under the Stock Option Plan may be either incentive stock
options ("ISOs") or such other forms of non-qualified stock options ("NQOs")
as the Committee may determine. ISOs are intended to qualify as "incentive
stock options" within the meaning of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code"). The exercise price of (i) an ISO granted to
an individual who owns shares possessing more than 10% of the total combined
voting power of all classes of stock of the Company (a "10% Owner") will be at
least 110% of the fair market value of a share of common stock on the date of
grant and (ii) an ISO granted to an individual other than a 10% Owner and an
NQO will be at least 100% of the fair market value of a share of Common Stock
on the date of grant.

Options granted under the Stock Option Plan may be subject to time vesting
and certain other restrictions at the Committee's sole discretion. Subject to
certain exceptions, the right to exercise an option generally will terminate
at the earlier of (i) the first date on which the initial grantee of such
option is not employed by the Company for any reason other than termination
without cause, death or permanent disability or (ii) the expiration date of
the option. If the holder of an option dies or suffers a permanent disability
while still employed by the Company, the right to exercise all unexpired
installments of such option shall be accelerated and shall vest as of the
latest of the date of such death, the date of such permanent disability and
the date of the discovery of such permanent disability, and such option shall
be exercisable, subject to certain exceptions, for 90 days after such date. If
the holder of an option is terminated without cause, to the extent the option
has vested, such option will be exercisable for 30 days after such date.

36
<PAGE>

All outstanding options under the Stock Option Plan will terminate
immediately prior to consummation of a liquidation or dissolution of the
Company, unless otherwise provided by the Board. In the event of the sale of
all or substantially all of the assets of the Company or the merger of the
Company with another corporation, all restrictions on any outstanding options
will terminate and Employee Participants will be entitled to the full benefit
of their options immediately prior to the closing date of such sale or merger,
unless otherwise provided by the Board.

The Board generally will have the power and authority to amend the Stock
Option Plan at any time without approval of the Company's stockholders;
however, the Board may not amend the Stock Option Plan to materially alter the
plan eligibility requirements, number of shares issuable under the plan or
benefits to participants in the plan without the approval of the Company's
stockholders. No options have been granted under the Stock Option Plan to
date. Immediately following the consummation of the Offering, the Company
intends to grant to Karl F. Storrie, President and Chief Executive Officer of
the Company, and John J. Knappenberger, Vice President of the Company, options
to purchase 80,000 shares and 22,600 shares, respectively, of Class A Common
Stock at an exercise price equal to the initial public offering price per
share. One-half of Mr. Storrie's options will vest on the first anniversary of
the date of grant, and one-half will vest on the second anniversary of the
date of grant. All of Mr. Knappenberger's options will vest on the six-month
anniversary of the date of grant.

EMPLOYEE STOCK DISCOUNT PURCHASE PLAN

The Employee Stock Purchase Plan will be approved by the Board and
stockholders prior to the consummation of the Offering. The Employee Stock
Purchase Plan will be established to give employees desiring to do so a
convenient means of purchasing shares of Common Stock through payroll
deductions. The Employee Stock Purchase Plan will provide an incentive to
participate by permitting purchases at a discounted price. The Company
believes that ownership of stock by employees will foster greater employee
interest in the success, growth and development of the Company.

Subject to certain restrictions, each employee of the Company who is a U.S.
resident or a U.S. citizen temporarily on location at a facility outside of
the U.S. will be eligible to participate in the Employee Stock Purchase Plan
if he or she has been employed by the Company for more than six months.
Participation will be discretionary with each eligible employee. The Company
will reserve 500,000 shares of Class A Common Stock for issuance in connection
with the Employee Stock Purchase Plan. Each eligible employee will be entitled
to purchase a maximum of 200 shares per year. Elections to participate and
purchases of stock will be made on a quarterly basis. Each participating
employee contributes to the Employee Stock Purchase Plan by choosing a payroll
deduction in any specified amount, with a minimum deduction of $10 per payroll
period. A participating employee may increase or decrease the amount of
his/her payroll deduction, including a change to a zero deduction as of the
beginning of any calendar quarter. Elected contributions will be credited to
participants' accounts at the end of each calendar quarter. In addition,
employees may make lump sum contributions at the end of the year to enable
them to purchase the maximum number of shares available for purchase during
the plan year.

Each participating employee's contributions will be used to purchase shares
for the employee's share account within 15 days after the last day of each
calendar quarter. The cost per share is 85% of the lower of the closing price
of the Company's Class A Common Stock on the Nasdaq National Market on the
first or the last day of the calendar quarter. The number of shares purchased
on each employee's behalf and deposited in his/her share account will be based
on the amount accumulated in such participant's cash account and the purchase
price for shares with respect to any calendar quarter. Shares purchased under
the Employee Stock Purchase Plan carry full rights to receive dividends
declared from time to time. Under the Employee Stock Purchase Plan any
dividends attributable to shares in the employee's share account will be
automatically used to purchase additional shares for such employee's share
account. Share distributions and share splits will be credited to the
participating employee's share account as of the record date and effective
date, respectively. A participating employee will have full ownership of all
shares in his/her share account and may withdraw them for sale or otherwise by
written

37
<PAGE>

request to the Committee following the close of each calendar quarter. Subject
to applicable federal securities and tax laws, the Board of Directors will have
the right to amend or to terminate the Employee Stock Purchase Plan. Amendments
to the Employee Stock Purchase Plan will not affect a participating employee's
right to the benefit of the contributions made by such employee prior to the
date of any such amendment. In the event the Employee Stock Purchase Plan is
terminated, the Committee will be required to distribute all shares held in
each participating employee's share account plus an amount of cash equal to the
balance in each participating employee's cash account.

INDEPENDENT DIRECTOR STOCK OPTION PLAN

The Director Option Plan will be approved by the Board and stockholders prior
to the consummation of the Offering. The Director Option Plan will be
established to encourage stock ownership by certain Directors of the Company
and to provide those individuals with an additional incentive to manage the
Company and to provide a form of compensation that will attract and retain
highly qualified individuals as members of the Board. The Director Option Plan
will provide for the issuance of options to independent Directors, as defined,
covering 100,000 shares of Class A Common Stock of the Company, subject to
certain adjustments reflecting changes in the Company's capitalization.

The terms of each option granted under the Director Option Plan may not
exceed ten years from the date of grant. The option price for each option must
equal 100% of the fair market value of the Company's Class A Common Stock on
the date the option is granted. In general, no option may be exercised in whole
or in part prior to the expiration of at least six months from the date of
grant of the option. In consideration of the grant of an option, an optionee is
required to agree to continue to serve as a director of the Company for the
lesser of 12 months from the date the option is granted or for the remainder of
the optionee's term as a Director of the Company. Notwithstanding this
requirement, nothing contained in the Director Option Plan or any agreement to
be executed pursuant to the Director Option Plan will obligate the Company, its
Board or its stockholders to retain an optionee as a Director of the Company.
No options have been granted under the Director Option Plan to date.

STOCKHOLDERS AGREEMENT

On August 31, 1994, the Company, Onex, J2R, Alkin and certain individuals
named therein (including members of the Company's management) entered into a
Stockholders Agreement (as amended, the "Stockholders Agreement"). Concurrently
with the Offering, the Stockholders Agreement will be amended and restated to
require all the parties thereto to vote their shares of Common Stock and take
any other action necessary to ensure the Board will be comprised of eleven
persons, seven of whom, including the two independent directors, shall be
designated by Onex, J2R and certain stockholders affiliated with Hidden Creek
(collectively, the "MC Stockholders") and four of whom shall be designated by
Alkin (the "Alkin Stockholders"). The voting provision terminates automatically
when the Alkin Stockholders cease to own at least 10% of the outstanding Common
Stock. The Stockholders Agreement also contains provisions granting the parties
thereto certain tag-along rights allowing them to sell their shares in certain
private sales of Common Stock initiated by the other parties to the
Stockholders Agreement. The Stockholders Agreement also provides that the
affirmative vote of two-thirds of the Board is required to issue any Preferred
Stock (as defined below) of the Company. The Stockholders Agreement also binds
subsequent transferees who have acquired their shares in private sales from the
parties to the Stockholders Agreement. Subject to certain exemptions, each of
Alkin, Onex, J2R and the MC Stockholders have agreed not to compete with the
business of the Company for a period of five years after the date of the
original Stockholders Agreement and Onex, J2R, the MC Stockholders and the
Company have agreed not to compete with the business of Alkin during that
period. J2R, Onex and Messrs. Johnson, Rued and Hibbs have also entered into an
agreement requiring the parties to vote their shares of Common Stock as
directed by Onex, and providing Onex with certain first offer rights in
connection with private sales of Common Stock.

38
<PAGE>

CERTAIN TRANSACTIONS

On August 31, 1994, MCHC, Alkin and all of the existing stockholders of MCHC
entered into an agreement whereby stockholders of MCHC contributed all shares
of MCHC common stock to the Company in return for shares of Class A Common
Stock. Alkin contributed the Brake and Cable Business to the Company in return
for (i) 2,206,890 shares of Class B Common Stock, (ii) an option to purchase
up to an additional 14,420 shares of Class B Common Stock at an exercise price
of $1.45 per share and (iii) cash consideration, net of assumed indebtedness,
of approximately $40 million. In addition to borrowings under the Bank Credit
Agreement, in financing such transaction, the Company borrowed an aggregate of
$4.0 million, evidenced by the Notes, from certain stockholders of the
Company, including Onex ($1.8 million), J2R ($0.2 million) and Alkin ($2.0
million). See "Use of Proceeds."

In connection with the acquisition of the Brake and Cable Business, the
Company entered into agreements with Alkin whereby the Company receives
services related to data processing, payroll, personnel administration and
other administrative matters. Amounts paid under these agreements were
$570,000 in 1994, $1,788,000 in 1995 and $370,000 in the six-month period
ended June 30, 1996. In addition, the Company and Alkin agreed to supply each
other's operations with certain items necessary for the manufacture of their
respective products. These supply agreements are for periods of up to five
years and the Company is required to purchase such supplies from Alkin only so
long as the supply terms remain no less favorable than could be obtained from
an independent party.

In November 1990, the Company's predecessor entered into a Management
Agreement with Hidden Creek, an affiliate of the Company. On August 31, 1994,
the Company and Hidden Creek entered into a new Management Agreement, and the
prior agreement was terminated. Pursuant to the Management Agreements, Hidden
Creek has provided strategic direction, management and financial and
administrative services to the Company. In exchange for such services, the
Company has paid monthly management fees to Hidden Creek. Total management
fees under such agreements were approximately $500,000 for 1993, $554,000 for
1994, $733,000 for 1995 and $500,000 for the six months ended June 30, 1996.
Although the current Management Agreement will be terminated upon completion
of the Offering, certain officers and employees of Hidden Creek will continue
to provide services to the Company. A portion of the salaries and expenses of
the Hidden Creek officers and employees will be allocated to the Company. The
Company also paid to Hidden Creek fees of approximately $500,000 in connection
with the acquisition of the Brake and Cable Business from Alkin and fees of
approximately $250,000 in connection with the sale of the Window Regulator
Business to Rockwell.

On June 26, 1995, the Company sold an aggregate of 78,819 shares of Class B
Common Stock to certain management employees at a purchase price of $2.69 per
share and 70,500 shares of Class B Common Stock to certain management
employees at a purchase price of $1.96 per share, pursuant to agreements
entered into in May 1995 and August 1994, respectively. In connection
therewith, Messrs. Klosterman, Kniss and Lamiman, each an executive officer of
the Company, purchased 35,250, 8,812 and 35,250 shares, respectively. In
connection with such sale, the Company loaned funds to finance up to half of
the purchase price for such shares at an interest rate equal to the base rate
of the Company's senior lender plus 1.5% (9.75% at June 30, 1996) and a
scheduled maturity on the earlier of (i) June 26, 2000 or (ii) the date such
employee sells such shares.

The Company has granted registration rights to certain of its existing
stockholders, including Onex, J2R, Alkin and Messrs. Johnson, Storrie,
Bubenzer, Bovee, Kniss, Klosterman and Lamiman. See "Shares Eligible for
Future Sale--Registration Agreement."

39
<PAGE>

PRINCIPAL STOCKHOLDERS

The Company currently has four classes of Common Stock outstanding.
Immediately prior to and contingent upon the Offering, the Company's four
classes of Common Stock will be converted into Class B Common Stock. The Class
A Common Stock being offered hereby and the Class B Common Stock will be
substantially identical except with respect to voting and conversion rights.
Each share of Class A Common Stock is entitled to one vote and each share of
Class B Common Stock is entitled to ten votes. Except as otherwise required by
law or by the Restated Certificate, the Class A Common Stock and the Class B
Common Stock will vote together as a single class on all matters submitted to
a vote of the stockholders, including the election of Directors. In addition,
the Class B Common Stock is convertible at any time at the option of the
holder thereof, and is mandatorily convertible upon any transfer thereof
(except to affiliates) and at any time that the MC Stockholders and their
affiliates, in the aggregate, do not hold at least 10% of the total
outstanding shares of Common Stock, into shares of Class A Common Stock on a
share-for-share basis. All of the Company's existing stockholders will receive
shares of Class B Common Stock in the Recapitalization. The number of shares
of Class B Common Stock that will be issued as a result of the conversion of
the Company's existing classes of Common Stock will be determined according to
the relative preference rankings of such existing Common Stock and the initial
public offering price of the Class A Common Stock.

The table below sets forth certain information regarding the equity
ownership of the Company as of June 30, 1996 and immediately following the
Offering (in each case giving effect to the Recapitalization at an assumed
initial public offering price of $15.00 per share), by (i) each person or
entity known to the Company who beneficially owns five percent or more of the
Common Stock of the Company, (ii) each Director and Named Executive Officer
and (iii) all Directors and executive officers of the Company as a group.
Unless otherwise stated, each of the persons named in the table has sole
voting and investment power with respect to the securities beneficially owned
by it or him as set forth opposite its or his name. Beneficial ownership of
the Common Stock listed in the table has been determined in accordance with
the applicable rules and regulations promulgated under the Exchange Act. The
actual number of shares to be issued to each existing stockholder in the
Recapitalization is subject to change based upon changes in the assumed
initial public offering price.

<TABLE>
<CAPTION>
COMMON STOCK OWNED COMMON STOCK OWNED
PRIOR TO THE OFFERING AFTER THE OFFERING
------------------------- -------------------------------------------
NUMBER PERCENTAGE NUMBER PERCENTAGE
OF SHARES OF SHARES OF SHARES OF SHARES
OF CLASS A OF CLASS A OF CLASS B OF CLASS B
NUMBER PERCENTAGE COMMON COMMON COMMON COMMON
NAME AND ADDRESS OF SHARES OF SHARES STOCK STOCK STOCK STOCK
<S> <C> <C> <C> <C> <C> <C>
Onex DHC LLC (1)(2)..... 2,791,364 55.7% -- -- 2,791,364 55.7%
Alkin Co. (2)(3)........ 2,221,310 44.3 -- -- 2,221,310 44.3
J2R Corporation (2)(4).. 409,291 8.2 -- -- 409,291 8.2
S. A. Johnson (2)(4).... 468,959 9.4 -- -- 468,959 9.4
Karl F. Storrie (2)..... 139,531 2.8 -- -- 139,531 2.8
David R. Bovee (2)...... 41,308 * -- -- 41,308 *
Joe A. Bubenzer (2)..... 35,814 * -- -- 35,814 *
Robert R. Hibbs (2)(5).. 432,240 8.6 -- -- 432,240 8.6
David P. Klosterman
(2).................... 35,250 * -- -- 35,250 *
John J. Knappenberger... -- -- -- -- -- --
Milton D. Kniss (2)..... 17,992 * -- -- 17,992 *
Craig L. Lamiman (2).... 35,250 * -- -- 35,250 *
Neil Anderson (2)(3).... 2,221,310 44.3 -- -- 2,221,310 44.3
W. H. Clement (2)....... -- -- -- -- -- --
James L. O'Loughlin
(2)(3)................. 2,221,310 44.3 -- -- 2,221,310 44.3
William L. Orscheln
(2)(3)................. 2,221,310 44.3 -- -- 2,221,310 44.3
Eric J. Rosen (1)(2).... 2,791,364 55.7 -- -- 2,791,364 55.7
Scott D. Rued (2)(6).... 455,189 9.1 -- -- 455,189 9.1
Barbara A. Westhues
(2)(3)................. 2,221,310 44.3 -- -- 2,221,310 44.3
All Directors and
executive officers as a
group
(16 persons)........... 4,858,094 96.9 -- -- 4,858,094 96.9
</TABLE>
- ---------------------
*Less than one percent.

40
<PAGE>

(1) Reflects shares of Class B Common Stock held by Onex DHC LLC, which has
shared voting power over 2,791,364 shares of Common Stock (see footnote
(2)) and sole dispositive power over 1,793,833 shares of Class B Common
Stock. Mr. Rosen, a Director of the Company, is Managing Director of Onex
Investment Corp. and disclaims beneficial ownership of all shares of
Common Stock owned by Onex DHC LLC. Onex DHC LLC and Onex Investment
Corp. are both wholly owned subsidiaries of Onex Corporation. The address
for Onex DHC LLC and Mr. Rosen is c/o Onex Investment Corp., 712 Fifth
Avenue, 40th Floor, New York, New York 10019.

(2) Onex, J2R, Messrs. Johnson, Storrie, Bovee, Bubenzer, Hibbs, Klosterman,
Kniss, Lamiman, Clement, Rosen and Rued and certain of the Company's other
existing stockholders have entered into agreements pursuant to which such
stockholders agreed to vote their shares of Common Stock in the same
manner as Onex votes its shares on all matters presented to the Company's
stockholders for a vote and, to the extent permitted by law, granted to
Onex a proxy to effectuate such agreement. As a result, Onex will have
voting control of approximately 53.0% of the Common Stock following the
completion of the Offering (52.6% if the Underwriters' over-allotment
option is exercised in full). All of the Company's existing stockholders,
including Alkin, have entered into an agreement providing for the election
of the Board. As a result, such stockholders will collectively have voting
control over 94.9% of the Common Stock following the completion of the
Offering (94.2% if the Underwriters' over-allotment option is exercised in
full).

(3) Includes 14,420 shares issuable upon the exercise of a currently
exercisable option issued to Alkin in connection with the Company's
acquisition of the Brake and Cable Business. Alkin has granted each of
Messrs. Anderson and O'Loughlin and Ms. Westhues options to acquire 13,218
shares of the Class B Common Stock owned by Alkin. Messrs. Anderson,
O'Loughlin and Orscheln and Ms. Westhues are officers of Alkin and, other
than Mr. Orscheln, each disclaims beneficial ownership of the shares owned
by Alkin other than the shares subject to each of their outstanding
options. The address for Alkin is 2000 U.S. Highway 63 South, Moberly,
Missouri 65270, and the address of each such individual is c/o Alkin at
the same address.

(4) Includes 409,291 shares owned by J2R, of which Mr. Johnson is President,
and 59,668 shares owned by Mr. Johnson. The address for Mr. Johnson and
J2R is c/o Dura Automotive Systems, Inc., 4508 IDS Center, Minneapolis,
Minnesota 55402.

(5) Includes 409,291 shares owned by J2R, of which Mr. Hibbs is a stockholder,
and 22,949 shares owned by Mr. Hibbs. Mr. Hibbs disclaims beneficial
ownership of the shares owned by J2R. The address for Mr. Hibbs is c/o
Dura Automotive Systems, Inc., 4508 IDS Center, Minneapolis, Minnesota
55402.

(6) Includes 409,291 shares owned by J2R, of which Mr. Rued is a stockholder,
and 45,898 shares owned by Mr. Rued. Mr. Rued disclaims beneficial
ownership of the shares owned by J2R. The address for Mr. Rued is c/o Dura
Automotive Systems, Inc., 4508 IDS Center, Minneapolis, Minnesota 55402.

41
<PAGE>

DESCRIPTION OF CAPITAL STOCK

GENERAL MATTERS

The Company currently has four classes of Common Stock outstanding.
Immediately prior to and contingent upon the Offering, the Company's four
classes of Common Stock will be converted into Class B Common Stock. All of
the Company's existing stockholders will receive shares of Class B Common
Stock in the Recapitalization. The number of shares of Class B Common Stock
that will be issued as a result of the conversion of the Company's existing
classes of Common Stock will be determined according to the relative
preference rankings of such existing Common Stock and the initial public
offering price of the Class A Common Stock.

At the time of the Offering, after giving effect to the Recapitalization,
the total amount of authorized capital stock of the Company will consist of
30,000,000 shares of Class A Common Stock, par value $0.01 per share,
10,000,000 shares of Class B Common Stock, par value $0.01 per share and
5,000,000 shares of Preferred Stock, par value $1.00 per share (the "Preferred
Stock"). Giving effect to the Recapitalization and upon completion of the
Offering, 2,700,000 shares of Class A Common Stock, 4,998,254 shares of Class
B Common Stock and no shares of Preferred Stock will be issued and
outstanding. The discussion herein describes the Company's capital stock, the
Restated Certificate and By-laws as anticipated to be in effect upon
consummation of the Offering. The following summary of certain provisions of
the Company's capital stock describes all material provisions of, but does not
purport to be complete and is subject to, and qualified in its entirety by,
the Restated Certificate and the By-laws of the Company that are included as
exhibits to the Registration Statement of which this Prospectus forms a part
and by the provisions of applicable law. As of June 30, 1996 (without giving
effect to the Recapitalization), the Company had 283,589 shares of Common
Stock outstanding held by 35 holders of record.

The Restated Certificate and By-laws will contain certain provisions that
are intended to enhance the likelihood of continuity and stability in the
composition of the Board and which may have the effect of delaying, deferring
or preventing a future takeover or change in control of the Company unless
such takeover or change in control is approved by the Board.

CLASS A COMMON STOCK

The shares of Class A Common Stock being offered by the Company will be,
upon payment therefor, validly issued, fully paid and nonassessable. Subject
to the prior rights of the holders of any Preferred Stock, the holders of
outstanding shares of Class A Common Stock will be entitled to receive
dividends out of assets legally available therefor at such time and in such
amounts as the Board may from time to time determine. See "Dividend Policy."
The shares of Class A Common Stock will not be convertible and the holders
thereof will have no preemptive or subscription rights to purchase any
securities of the Company. Upon liquidation, dissolution or winding up of the
Company, the holders of Class A Common Stock will be entitled to receive pro
rata the assets of the Company which are legally available for distribution,
after payment of all debts and other liabilities and subject to the prior
rights of any holders of Preferred Stock then outstanding. Each outstanding
share of Class A Common Stock will be entitled to one vote on all matters
submitted to a vote of stockholders. Except as otherwise required by law or
the Restated Certificate, the Class A Common Stock and Class B Common Stock
will vote together on all matters submitted to a vote of the stockholders,
including the election of Directors.

Application has been made for quotation of the Class A Common Stock on the
Nasdaq National Market under the symbol "DRRA."

CLASS B COMMON STOCK

The issued and outstanding shares of Class B Common Stock generally will
have identical rights to those of the Class A Common Stock except with respect
to voting power and conversion rights. Each share of Class B Common Stock will
be entitled to ten votes on all matters submitted to a vote of stockholders,
as compared to

42
<PAGE>

one vote for each share of Class A Common Stock. Class B Common Stock will be
convertible at the option of the holder, and mandatorily convertible upon any
transfer thereof (except to affiliates) and at any time that the MC
Stockholders and their affiliates, in the aggregate, do not beneficially own
at least 10% of the total outstanding shares of Common Stock, into Class A
Common Stock on a share-for-share basis. The Class B Common Stock will not be
registered under the Securities Act and will not be listed for trading on any
national securities exchange or on the Nasdaq National Market.

PREFERRED STOCK

The Board may, without further action by the Company's stockholders, from
time to time, direct the issuance of shares of Preferred Stock in series and
may, at the time of issuance, determine the rights, preferences and
limitations of each series. Satisfaction of any dividend preferences of
outstanding shares of Preferred Stock would reduce the amount of funds
available for the payment of dividends on shares of Common Stock. Holders of
shares of Preferred Stock may be entitled to receive a preference payment in
the event of any liquidation, dissolution or winding-up of the Company before
any payment is made to the holders of shares of Common Stock. Under certain
circumstances, the issuance of shares of Preferred Stock may render more
difficult or tend to discourage a merger, tender offer or proxy contest, the
assumption of control by a holder of a large block of the Company's securities
or the removal of incumbent management. Upon the affirmative vote of a
majority of the total number of Directors then in office, the Board, without
stockholder approval, may issue shares of Preferred Stock with voting and
conversion rights which could adversely affect the holders of shares of Common
Stock. Upon consummation of the Offering, there will be no shares of Preferred
Stock outstanding, and the Company has no present intention to issue any
shares of Preferred Stock. The Stockholders Agreement provides that the
affirmative vote of two-thirds of the Board is required to issue any Preferred
Stock.

CERTAIN PROVISIONS OF THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
AND BY-LAWS

The Restated Certificate will provide that stockholder action can be taken
only at an annual or special meeting of stockholders and cannot be taken by
written consent in lieu of a meeting. The Restated Certificate and the By-laws
will provide that, except as otherwise required by law, special meetings of
the stockholders can only be called by the Chairman of the Board or the
President of the Company, or pursuant to a resolution adopted by a majority of
the Board. Stockholders will not be permitted to call a special meeting or to
require the Board to call a special meeting.

The By-laws will establish an advance notice procedure for stockholder
proposals to be brought before an annual meeting of stockholders of the
Company, including proposed nominations of persons for election to the Board.

Stockholders at an annual meeting may only consider proposals or nominations
specified in the notice of meeting or brought before the meeting by or at the
direction of the Board or by a stockholder who was a stockholder of record on
the record date for the meeting, who is entitled to vote at the meeting and
who has given to the Company's Secretary timely written notice, in proper
form, of the stockholder's intention to bring that business before the
meeting. Although the By-laws will not give the Board the power to approve or
disapprove stockholder nominations of candidates or proposals regarding other
business to be conducted at a special or annual meeting, the By-laws may have
the effect of precluding the conduct of certain business at a meeting if the
proper procedures are not followed or may discourage or defer a potential
acquiror from conducting a solicitation of proxies to elect its own slate of
Directors or otherwise attempting to obtain control of the Company.

The Restated Certificate and By-laws will provide that the affirmative vote
of holders of at least 80% of the total votes eligible to be cast in the
election of Directors will be required to amend, alter, change or repeal
certain of their provisions. This requirement of a super-majority vote to
approve amendments to the Restated Certificate and By-laws could enable a
minority of the Company's stockholders to exercise veto power over any such
amendments. In addition, the Class B Common Stock has ten votes, as compared
to one vote for each share of

43
<PAGE>

Class A Common Stock, on all matters, including the election of Directors, to
come before the stockholders. By virtue of such stock ownership, the holders
of the Class B Common Stock will be able to control the vote on all matters
submitted to a vote of the holders of Common Stock, including the election of
Directors, amendments to the Restated Certificate and By-laws and approval of
significant corporate transactions. Such concentration of ownership could also
have the effect of delaying, deterring or preventing a change in control of
the Company that might otherwise be beneficial to stockholders. See "Risk
Factors--Controlling Stockholder."

CERTAIN PROVISIONS OF DELAWARE LAW

Following the consummation of the Offering, the Company will be subject to
the "business combination" provisions of the Delaware General Corporation Law.
In general, such provisions prohibit a publicly held Delaware corporation from
engaging in various "business combination" transactions with any "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an "interested stockholder," unless (i) the
transaction is approved by the Board of Directors prior to the date the
"interested stockholder" obtained such status, (ii) upon consummation of the
transaction which resulted in the stockholder becoming an "interested
stockholder," the "interested stockholder," owned at least 85% of the voting
stock of the corporation outstanding at the time the transaction commenced,
excluding for purposes of determining the number of shares outstanding those
shares owned by (a) persons who are directors and also officers and (b)
employee stock plans in which employee participants do not have the right to
determine confidentially whether shares held subject to the plan will be
tendered in a tender or exchange offer, or (iii) on or subsequent to such date
the "business combination" is approved by the board of directors and
authorized at an annual or special meeting of stockholders by the affirmative
vote of at least 66 2/3% of the outstanding voting stock which is not owned by
the "interested stockholder." A "business combination" is defined to include
mergers, asset sales and other transactions resulting in financial benefit to
a stockholder. In general, an "interested stockholder" is a person who,
together with affiliates and associates, owns (or within three years, did own)
15% or more of a corporation's voting stock. The statute could prohibit or
delay mergers or other takeover or change in control attempts with respect to
the Company and, accordingly, may discourage attempts to acquire the Company.

LIMITATIONS ON LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS

The Restated Certificate will limit the liability of Directors to the
fullest extent permitted by the Delaware General Corporation Law. In addition,
the Restated Certificate will provide that the Company shall indemnify
Directors and officers of the Company to the fullest extent permitted by such
law. The Company anticipates entering into indemnification agreements with its
current Directors and executive officers prior to the completion of the
Offering.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Class A Common Stock will be
Firstar Trust Company.

44
<PAGE>

SHARES ELIGIBLE FOR FUTURE SALE

Prior to the Offering there has been no market for the Common Stock of the
Company. The Company can make no predictions as to the effect, if any, that
sales of shares or the availability of shares for sale will have on the market
price prevailing from time to time. Nevertheless, sales of significant amounts
of the Class A Common Stock in the public market, or the perception that such
sales may occur, could adversely affect prevailing market prices. See "Risk
Factors--Shares Eligible for Future Sale."

Upon completion of the Offering, the Company expects to have 7,698,254
shares of Common Stock outstanding. Of these shares, the 2,700,000 shares of
Class A Common Stock sold in the Offering (3,105,000 shares if the
Underwriters' over-allotment option is exercised in full) will be freely
tradeable without restriction under the Securities Act, except for any such
shares which may be acquired by an "affiliate" of the Company (an "Affiliate")
as that term is defined in Rule 144 under the Securities Act, which shares
will be subject to the resale limitations of Rule 144. The remaining
outstanding shares of Common Stock held by existing stockholders upon
completion of the Offering will be "restricted securities" (as that phrase is
defined in Rule 144) and may not be resold in the absence of registration
under the Securities Act or pursuant to exemptions from such registration,
including among others, the exemptions provided by Rule 144 under the
Securities Act.

In general, under Rule 144 as currently in effect, beginning 90 days after
the date of this Prospectus, if a period of at least two years has elapsed
since the later of the date the restricted securities were acquired from the
Company and the date they were acquired from an Affiliate, then the holder of
such restricted securities (including an Affiliate) is entitled to sell a
number of shares within any three-month period that does not exceed the
greater of 1% of the then outstanding shares of the Class A Common Stock
(approximately 27,000 shares immediately after the Offering) or the average
weekly reported volume of trading of the Class A Common Stock on the Nasdaq
National Market during the four calendar weeks preceding such sale. The holder
may only sell such shares through unsolicited brokers' transactions. Sales
under Rule 144 are also subject to certain requirements pertaining to the
manner of such sales, notices of such sales and the availability of current
public information concerning the Company. Affiliates may sell shares not
constituting restricted shares in accordance with the foregoing volume
limitations and other requirements but without regard to the two-year holding
period. Under Rule 144(k), if a period of at least three years has elapsed
between the later of the date restricted securities were acquired from the
Company and the date they were acquired from an Affiliate, as applicable, a
holder of such restricted securities who is not an Affiliate at the time of
the sale and has not been an Affiliate for at least three months prior to the
sale would be entitled to sell the shares immediately without regard to the
volume limitations and other conditions described above. In June 1995, the
Commission proposed reducing the two and three-year holding period under Rule
144 described above to one and two years, respectively.

Without giving effect to the contractual restrictions described below,
4,854,317 shares of Class A Common Stock (represented by currently outstanding
shares of Class B Common Stock) will be eligible for sale in the public market
under Rule 144, subject to the volume limitations and the other conditions
described above, 90 days after the date of this Prospectus.

The Company and certain of its existing stockholders, who in aggregate own
4,998,254 shares of Common Stock, will agree that, for a period of 180 days
after the date of this Prospectus, they will not, without the prior written
consent of Donaldson, Lufkin & Jenrette Securities Corporation, offer, sell,
contract to sell or otherwise dispose of any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock
other than sales of Class A Common Stock under the Underwriting Agreement (as
defined) or the issuance of shares of Class A Common Stock upon the exercise
of outstanding options.

REGISTRATION AGREEMENT

The Company, Onex, J2R, Alkin and the management stockholders named therein
(the "Management Stockholders") are parties to a registration agreement (the
"Registration Agreement") dated August 31, 1994. Under the Registration
Agreement, the holders of a majority of shares of Common Stock held by Onex,
J2R and

45
<PAGE>

the Management Stockholders, as a group, or the holders of a majority of
shares of Common Stock held by Alkin, each have the right at any time, subject
to certain conditions, to require the Company to register any and all of their
shares of Common Stock under the Securities Act on Form S-1 (a "Long-Form
Registration") on four occasions at the Company's expense and on Form S-2 or
Form S-3 (a "Short-Form Registration") on an unlimited number of occasions at
the Company's expense. The Company is not required, however, to effect any
such Long-Form Registration or Short-Form Registration within six months after
the effective date of a prior demand registration or a registration in which
the holders of registrable securities were given piggyback rights with no
cutbacks and may postpone the filing of such registration for up to six months
if the holders of a majority of the registrable securities agree that such a
registration would likely have a material adverse effect on the Company. In
addition, such parties are entitled to request the inclusion of any Common
Stock subject to the Registration Agreement in any registration statement at
the Company's expense whenever the Company proposed to register any of its
securities under the Securities Act, subject to certain conditions. In
connection with all registrations, the Company has agreed to indemnify all
holders of registerable securities against certain liabilities, including
liabilities under the Securities Act. Beginning 180 days after the date of the
Prospectus, the holders of an aggregate of 4,998,254 shares of Common Stock
will have registration rights pursuant to the Registration Agreement.

46
<PAGE>

UNDERWRITING

The Underwriters named below (the "Underwriters") for whom Donaldson, Lufkin
& Jenrette Securities Corporation, Morgan Stanley & Co. Incorporated and
Robert W. Baird & Co. Incorporated are acting as representatives (the
"Representatives"), have severally agreed, subject to the terms and conditions
of an underwriting agreement (the "Underwriting Agreement"), to purchase from
the Company the respective number of shares of Class A Common Stock set forth
opposite their names below:

<TABLE>
<CAPTION>
NUMBER OF
SHARES OF CLASS A
UNDERWRITER COMMON STOCK
<S> <C>
Donaldson, Lufkin & Jenrette Securities Corporation........
Morgan Stanley & Co. Incorporated..........................
Robert W. Baird & Co. Incorporated.........................
---------
Total.............................................. 2,700,000
=========
</TABLE>

The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the shares of the Class A
Common Stock offered hereby are subject to approval of certain legal matters
by counsel and to certain other conditions. The Underwriters are obligated to
take and pay for all the shares of the Class A Common Stock if any are taken.

The Representatives have advised the Company that the Underwriters propose
to offer the shares of the Class A Common Stock in part directly to the public
initially at the public offering price set forth on the cover page of this
Prospectus and in part to certain dealers at such price less a concession not
in excess of $ per share; that the Underwriters may allow, and such dealers
may reallow, a concession not in excess of $ per share on sales to other
dealers; and that after the initial public offering, the public offering price
and other selling terms may be changed by the Representatives. The
Underwriters have informed the Company that they do not intend to confirm
sales to any accounts over which they exercise discretionary authority.

The Company has granted to the Underwriters an option, exercisable for 30
days from the date of this Prospectus, to purchase up to an aggregate of
405,000 additional shares of Class A Common Stock at the initial public
offering price less underwriting discounts and commissions. The Underwriters
may exercise such option only for the purpose of covering over-allotments, if
any, incurred in connection with the sales of Class A Common Stock offered
hereby. To the extent that the Underwriters exercise such option, each
Underwriter will become obligated, subject to certain conditions, to purchase
the same percentage of such additional shares as the number of other shares to
be purchased by that Underwriter bears to the total number of shares set forth
on the cover page of this Prospectus.

At the request of the Company, the Underwriters have reserved up to 135,000
shares of Class A Common Stock for sale at the initial public offering price
to directors, officers, employees and business associates of the Company. Any
reserved shares which are not so purchased will be offered by the Underwriters
to the general public on the same basis as the other shares offered hereby.

The Company and certain of its existing stockholders, who own an aggregate
of 4,998,254 shares of Common Stock, have agreed prior to the consummation of
the offering with the Underwriters, not to offer, sell, contract to sell,
grant any other option to purchase or otherwise dispose of any shares of the
Common Stock or

47
<PAGE>

any securities convertible into or exercisable for, or warrants, rights or
options to acquire, shares of Common Stock for a period of 180 days without
the prior written consent of Donaldson, Lufkin & Jenrette Securities
Corporation, other than sales of Class A Common Stock under the Underwriting
Agreement or the issuance of shares of Class A Common Stock upon the exercise
of outstanding options.

The Company and its principal operating subsidiary have agreed to indemnify
the Underwriters against certain liabilities, including liabilities under the
Securities Act, or to contribute to payments that they may be required to make
in respect thereof.

The initial public offering price for the shares of Class A Common Stock
will be determined through negotiations between the Company and the
Representatives. Among the factors to be considered in such negotiations are
the future prospects of the Company and its industry in general, the
experience of management, the demand for similar securities of companies
considered comparable to the Company, the prevailing conditions in the equity
securities market and other relevant factors. There can be no assurance that
an active trading market will develop for the shares of Class A Common Stock
or that the shares of Class A Common Stock will trade in the public market
subsequent to the Offering at or above the initial offering price.

LEGAL MATTERS

The validity of the Class A Common Stock being offered hereby will be passed
upon for the Company by Kirkland & Ellis (a partnership which includes
professional corporations), Chicago, Illinois, and for the Underwriters by
Gardner, Carton & Douglas, Chicago, Illinois.

EXPERTS

The audited financial statements included in this Prospectus and elsewhere
in the Registration Statement have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto, and are included herein in reliance upon the authority of said firm
as experts in giving said reports.

ADDITIONAL INFORMATION

The Company has filed with the Commission a Registration Statement on Form
S-1 under the Securities Act with respect to the Class A Common Stock being
offered hereby. This Prospectus does not contain all the information set forth
in the Registration Statement and the exhibits and schedules thereto, certain
items of which are omitted in accordance with the rules and regulations of the
Commission. Statements contained in this Prospectus concerning the provisions
of documents filed with the Registration Statement as exhibits are necessarily
summaries of such documents, and each such statement is qualified in its
entirety by reference to the copy of the applicable document filed as an
exhibit to the Registration Statement. The Registration Statement can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549; at its Chicago
Regional Office, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-
2511; and at its New York Regional Office, Seven World Trade Center, 13th
Floor, New York, New York 10048. Copies of such material can be obtained from
the public reference section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, upon payment of the prescribed rates. The Commission
maintains a Web site that contains reports, proxy and information statements
and other information regarding registrants that file electronically with the
Commission, and the address of such site is http://www.sec.gov. For further
information pertaining to the Company and the Common Stock being offered
hereby, reference is made to the Registration Statement, including the
exhibits thereto and the financial statements, notes and schedules filed as a
part thereof.

As a result of the Offering, the Company will become subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). So long as the Company is subject to the periodic
reporting requirements of the Exchange Act, it will continue to furnish the
reports and other information required thereby to the Commission. The Company
intends to furnish holders of the Class A Common Stock with annual reports
containing, among other information, audited financial statements certified by
an independent public accounting firm and quarterly reports containing
unaudited condensed financial information for the first three quarters of each
fiscal year. The Company also intends to furnish such other reports as it may
determine or as may be required by law.

48
<PAGE>

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
<S> <C>
DURA AUTOMOTIVE SYSTEMS, INC.
Report of Independent Public Accountants................................ F-2
Consolidated Balance Sheets as of December 31, 1994 and 1995 and June
30, 1996 (unaudited)................................................... F-3
Consolidated Statements of Operations for the years ended December 31,
1993, 1994 and 1995 and for the six months ended June 30, 1995 and 1996
(unaudited)............................................................ F-4
Consolidated Statements of Stockholders' Investment for the years ended
December 31, 1993, 1994 and 1995 and for the six months ended June 30,
1996 (unaudited)....................................................... F-5
Consolidated Statements of Cash Flows for the years ended December 31,
1993, 1994 and 1995 and for the six months ended June 30, 1995 and 1996
(unaudited)............................................................ F-6
Notes to Consolidated Financial Statements.............................. F-7
ORSCHELN AUTOMOTIVE BUSINESS UNIT
Report of Independent Public Accountants................................ F-20
Statements of Operations for the year ended December 31, 1993 and the
eight-month period ended August 31, 1994............................... F-21
Statements of Cash Flows for the year ended December 31, 1993 and the
eight-month period ended August 31, 1994............................... F-22
Notes to Financial Statements........................................... F-23
</TABLE>

F-1
<PAGE>

After the recapitalization and stock split discussed in Notes 10 and 11 to
Dura Automotive Systems, Inc.'s consolidated financial statements are
effected, we expect to be in a position to render the following audit report.

ARTHUR ANDERSEN LLP

August 5, 1996

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Dura Automotive Systems, Inc.

We have audited the accompanying consolidated balance sheets of Dura
Automotive Systems, Inc. (a Delaware corporation--See Note 1 of Notes to
Consolidated Financial Statements) and Subsidiaries as of December 31, 1994
and 1995 and the related consolidated statements of operations, stockholders'
investment and cash flows for each of the three years in the period ended
December 31, 1995. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. 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, the financial statements referred to above present fairly,
in all material respects, the financial position of Dura Automotive Systems,
Inc. and Subsidiaries as of December 31, 1994 and 1995, and the results of
their operations and their cash flows for each of the three years in the
period ended December 31, 1995 in conformity with generally accepted
accounting principles.

Minneapolis, Minnesota,
January 26, 1996
(except for the matters
discussed in Notes 10 and 11
for which the date is
August , 1996)

F-2
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
DECEMBER 31,
------------------ JUNE 30,
1994 1995 1996
-------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents..................... $ 17 $ 1,732 $ 3,239
Accounts receivable, net...................... 46,762 34,990 40,760
Inventories................................... 16,348 11,916 10,278
Other current assets.......................... 9,922 10,661 6,203
-------- -------- --------
Total current assets....................... 73,049 59,299 60,480
-------- -------- --------
Property, Plant and Equipment:
Land and buildings............................ 10,665 9,333 9,771
Machinery and equipment....................... 35,681 34,889 36,298
Construction in progress...................... 4,538 2,731 2,960
Less--Accumulated depreciation................ (8,175) (10,246) (12,847)
-------- -------- --------
Net property, plant and equipment.......... 42,709 36,707 36,182
-------- -------- --------
Other Assets:
Goodwill...................................... 40,287 42,388 40,730
Other......................................... 5,219 5,362 5,667
Less--Accumulated amortization................ (2,131) (3,225) (3,697)
-------- -------- --------
Total other assets......................... 43,375 44,525 42,700
-------- -------- --------
$159,133 $140,531 $139,362
======== ======== ========
LIABILITIES AND STOCKHOLDERS' INVESTMENT
Current Liabilities:
Accounts payable.............................. $ 27,353 $ 24,865 $ 22,756
Accrued liabilities........................... 22,411 15,596 18,188
Current maturities of long-term debt.......... 4,654 5,137 5,536
-------- -------- --------
Total current liabilities.................. 54,418 45,598 46,480
Long-Term Debt, net of current maturities...... 70,112 46,639 40,555
Other Noncurrent Liabilities................... 17,185 20,611 19,700
-------- -------- --------
Commitments and Contingencies (Notes 4, 7, 8
and 9)
Stockholders' Investment:
Preferred stock, par value $1; 5,000,000
shares authorized;
none issued or outstanding................... -- -- --
Common stock, Class A; par value $.01;
30,000,000 shares authorized; none issued or
outstanding.................................. -- -- --
Common stock, Class B; par value $.01;
10,000,000 shares authorized; 4,904,186,
5,007,307 and 4,998,254 shares issued and
outstanding.................................. 49 50 50
Additional paid-in capital.................... 13,368 13,563 13,524
Retained earnings............................. 4,132 14,258 19,212
Common stock subscriptions receivable......... (131) (188) (159)
-------- -------- --------
Total stockholders' investment............. 17,418 27,683 32,627
-------- -------- --------
$159,133 $140,531 $139,362
======== ======== ========
</TABLE>

The accompanying notes are an integral part of these consolidated balance
sheets.

F-3
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED DECEMBER 31, JUNE 30,
-------------------------- -----------------
1993 1994 1995 1995 1996
-------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenues.......................... $129,328 $189,675 $253,726 $142,866 $127,357
Cost of sales..................... 116,961 170,748 220,274 124,730 109,141
-------- -------- -------- -------- --------
Gross profit..................... 12,367 18,927 33,452 18,136 18,216
Selling, general and
administrative expenses.......... 8,293 10,362 14,798 6,745 7,586
Amortization expense.............. 487 690 1,094 548 472
-------- -------- -------- -------- --------
Operating income................. 3,587 7,875 17,560 10,843 10,158
Interest expense.................. 1,533 3,473 4,822 2,631 1,900
Gain on sale of window regulator
business......................... -- -- 4,240 4,240 --
-------- -------- -------- -------- --------
Income before income taxes....... 2,054 4,402 16,978 12,452 8,258
Provision for income taxes........ 936 1,822 6,852 5,026 3,304
-------- -------- -------- -------- --------
Net income....................... $ 1,118 $ 2,580 $ 10,126 $ 7,426 $ 4,954
======== ======== ======== ======== ========
Pro forma net income per common
and common equivalent share after
giving effect to recapitalization
(Notes 2 and 10)................. $ 2.03 $ .99
======== ========
Pro forma weighted average common
and common equivalent shares
outstanding after giving effect
to recapitalization (Notes 2 and
10).............................. 4,989 5,026
======== ========
</TABLE>

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

F-4
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' INVESTMENT

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
COMMON STOCK
-------------------------------
CLASS A CLASS B ADDITIONAL COMMON STOCK
------------- ----------------- PAID-IN RETAINED SUBSCRIPTIONS
SHARES AMOUNT SHARES AMOUNT CAPITAL EARNINGS RECEIVABLE TOTAL
------ ------ --------- ------ ---------- -------- ------------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE, December 31,
1992................... -- -- 2,764,907 $28 $ 2,979 $ 434 $(114) $ 3,327
Repurchase of common
stock, net............ -- -- (64,701) (1) (86) -- 11 (76)
Net income............. -- -- -- -- -- 1,118 -- 1,118
--- --- --------- --- ------- ------- ----- -------
BALANCE, December 31,
1993................... -- -- 2,700,206 27 2,893 1,552 (103) 4,369
Repurchase of common
stock, net............ -- -- (2,910) -- (3) -- (28) (31)
Issuance of common
stock for
acquisition........... -- -- 2,206,890 22 10,478 -- -- 10,500
Net income............. -- -- -- -- -- 2,580 -- 2,580
--- --- --------- --- ------- ------- ----- -------
BALANCE, December 31,
1994................... -- -- 4,904,186 49 13,368 4,132 (131) 17,418
Repurchase of common
stock, net............ -- -- (46,204) -- (155) -- 19 (136)
Issuance of common
stock................. -- -- 149,325 1 350 -- (76) 275
Net income............. -- -- -- -- -- 10,126 -- 10,126
--- --- --------- --- ------- ------- ----- -------
BALANCE, December 31,
1995................... -- -- 5,007,307 50 13,563 14,258 (188) 27,683
Repurchase of common
stock, net
(unaudited)........... -- -- (9,053) -- (39) -- 29 (10)
Net income
(unaudited)........... -- -- -- -- -- 4,954 -- 4,954
--- --- --------- --- ------- ------- ----- -------
BALANCE, June 30, 1996
(unaudited)............ -- -- 4,998,254 $50 $13,524 $19,212 $(159) $32,627
=== === ========= === ======= ======= ===== =======
</TABLE>

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

F-5
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED DECEMBER 31, JUNE 30,
--------------------------- ------------------
1993 1994 1995 1995 1996
------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Operating activities:
Net income................... $ 1,118 $ 2,580 $ 10,126 $ 7,426 $ 4,954
Adjustments required to
reconcile net income to net
cash provided by (used in)
operating activities--
Depreciation and
amortization.............. 2,409 3,725 5,578 2,966 3,073
Deferred income tax
provision................. 681 1,507 5,067 2,608 1,658
Gain on sale of window
regulator business........ -- -- (4,240) (4,240) --
Change in other operating
items:
Accounts receivable, net.. 5,505 (6,997) 11,772 12,137 (5,770)
Inventories............... 900 1,821 2,167 375 1,638
Other current assets...... (3,183) (3,261) (1,405) (1,771) 4,458
Accounts payable.......... 3,962 (6,813) (2,656) (663) (2,109)
Accrued liabilities and
other.................... (7,668) 1,282 (13,271) (1,982) 1,681
------- -------- -------- -------- --------
Net cash provided by
(used in) operating
activities.............. 3,724 (6,156) 13,138 16,856 9,583
------- -------- -------- -------- --------
Investing activities:
Capital expenditures, net.... (2,951) (5,406) (6,116) (2,009) (2,076)
Acquisition, net............. -- (39,428) -- -- --
Sale of window regulator
business, net............... -- -- 18,006 18,006 --
Other, net................... -- (2,044) (462) (305) (305)
------- -------- -------- -------- --------
Net cash provided by
(used in) investing
activities.............. (2,951) (46,878) 11,428 15,692 (2,381)
------- -------- -------- -------- --------
Financing activities:
Borrowings under revolving
credit facility............. 92,748 91,625 95,500 34,750 62,500
Repayment of revolving credit
facility.................... (92,898) (83,550) (105,750) (52,000) (65,750)
Proceeds from issuance of
debt........................ -- 66,500 -- -- --
Repayments of debt........... (1,300) (22,660) (12,740) (11,437) (2,435)
Sale (repurchase) of common
stock, net.................. (87) (3) 139 192 (10)
Proceeds from notes payable
to stockholders............. 750 1,125 -- -- --
------- -------- -------- -------- --------
Net cash provided by
(used in) financing
activities.............. (787) 53,037 (22,851) (28,495) (5,695)
------- -------- -------- -------- --------
Net change in cash and
cash equivalents........ (14) 3 1,715 4,053 1,507
Cash and cash equivalents,
beginning of period.......... 28 14 17 17 1,732
------- -------- -------- -------- --------
Cash and cash equivalents, end
of period.................... $ 14 $ 17 $ 1,732 $ 4,070 $ 3,239
======= ======== ======== ======== ========
Supplemental cash flow
information:
Cash paid for--
Interest.................... $ 1,504 $ 2,781 $ 4,822 $ 2,962 $ 2,153
======= ======== ======== ======== ========
Income taxes................ $ 245 $ 145 $ 2,285 $ 475 $ 1,052
======= ======== ======== ======== ========
</TABLE>

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

F-6
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(INFORMATION AS OF AND FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND 1996 IS
UNAUDITED)

1. ORGANIZATION AND BASIS OF PRESENTATION:

The consolidated financial statements include the accounts of Dura
Automotive Systems, Inc. (Systems or Parent; formerly Dura Automotive Holding,
Inc.) and its subsidiaries, Dura Operating Corp. (formerly Dura Automotive
Systems, Inc.) and Dura de Mexico S.A. de C.V. (a Mexican corporation),
collectively referred to as Dura or the Company. Dura designs and manufactures
mechanical assembly systems, components and hardware for use in the automotive
industry. Dura has eight manufacturing facilities located in Michigan,
Missouri and Mexico.

2. SIGNIFICANT ACCOUNTING POLICIES:

PRINCIPLES OF CONSOLIDATION:

The consolidated financial statements include the accounts of Systems and
its subsidiaries. All significant intercompany accounts and transactions have
been eliminated in consolidation.

FISCAL YEAR:

The Company has adopted a 52-/53-week fiscal year. For presentation
purposes, the Company uses December 31 as the fiscal year end.

USE OF ESTIMATES:

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Ultimate results could differ from those
estimates.

CASH EQUIVALENTS:

Cash equivalents consist of money market instruments with original
maturities of three months or less and are stated at cost which approximates
fair value.

INVENTORIES:

Inventories are valued at the lower of first-in, first-out (FIFO) cost or
market.

Inventories consisted of the following (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
--------------- JUNE 30,
1994 1995 1996
------- ------- -----------
<S> <C> <C> <C> <C>
Raw materials................................... $ 6,762 $ 5,841 $ 4,915
Work in process................................. 7,220 3,883 3,401
Finished goods.................................. 2,366 2,192 1,962
------- ------- -------
$16,348 $11,916 $10,278
======= ======= =======
</TABLE>

Effective December 31, 1995, the Company adopted the FIFO method of
inventory valuation for all locations. Prior to that date, the Company used
the last-in, first-out (LIFO) method of inventory valuation for certain
locations. The effect of this change in accounting method, if it had been
retroactively reflected in the accompanying consolidated financial statements,
would not have been material to the Company's consolidated financial position
or results of operations.

F-7
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

OTHER CURRENT ASSETS:

Other current assets consisted of the following (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
-------------- JUNE 30,
1994 1995 1996
------ ------- --------
<S> <C> <C> <C>
Excess of cost over billings on uncompleted
tooling projects................................ $8,851 $ 8,653 $4,960
Prepaid expenses................................. 762 1,699 934
Deferred tooling and design costs................ 309 309 309
------ ------- ------
$9,922 $10,661 $6,203
====== ======= ======
</TABLE>

Excess of cost over billings on uncompleted tooling projects represents
costs incurred by the Company in the development of new tooling used in the
manufacture of the Company's products. Once customer approval is obtained for
the manufacture of a new product, the Company is reimbursed by its customers
for the cost of the tooling, at which time the tooling becomes the property of
the customer. Generally, reimbursement is received before production of the
related part commences.

Certain tooling and design costs are reimbursed by the Company's customers
as the related product is sold through an incremental increase in each
product's unit selling price. The amount the Company expects to recover in the
current operating cycle is included in other current assets. Amounts expected
to be recovered beyond the current operating period, $2,128,000 at December
31, 1995 and $2,302,000 at June 30, 1996, are included in other assets.

PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment acquired in connection with the acquisition
discussed in Note 3 are stated at fair value as of the acquisition date.
Additions to property, plant and equipment are stated at cost. For financial
reporting purposes, depreciation is provided on the straight-line method over
the following estimated useful lives:

<TABLE>
<S> <C>
Buildings...................... 30 years
Machinery and equipment........ 3 to 20 years
</TABLE>

Accelerated depreciation methods are used for tax reporting purposes.

Maintenance and repairs are charged to expense as incurred. Major
betterments and improvements which extend the useful life of the item are
capitalized and depreciated. The cost and accumulated depreciation of
property, plant and equipment retired or otherwise disposed of are removed
from the related accounts and any residual values are charged or credited to
income.

OTHER ASSETS:

Goodwill represents the excess of the purchase price over the fair value of
the net assets acquired and is being amortized on a straight-line basis over a
40-year period from the date of the related acquisition. Other assets
principally consist of transaction costs, representing costs incurred related
to the acquisitions and are being amortized over five to seven years.

F-8
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
The Company periodically evaluates whether events and circumstances have
occurred which may affect the estimated useful life or the recoverability of
the remaining balance of its goodwill. If such events or circumstances
indicate that the carrying amount of goodwill may not be recoverable, the
Company estimates the future cash flows expected to result from the use of the
net assets acquired and their eventual disposition. If the sum of the expected
future cash flows (undiscounted and without interest charges) is less than the
carrying amount of goodwill, the Company will recognize an impairment loss in
accordance with Statement of Financial Accounting Standards (SFAS) No. 121
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets
to be Disposed Of."

ACCRUED LIABILITIES:

Accrued liabilities consisted of the following (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
--------------- JUNE 30,
1994 1995 1996
------- ------- --------
<S> <C> <C> <C>
Compensation and benefits........................... $ 3,681 $ 4,256 $ 4,014
Medical insurance................................... 2,904 4,016 5,467
Product warranty.................................... 7,000 1,125 616
Interest............................................ 641 763 552
Other............................................... 8,185 5,436 7,539
------- ------- -------
$22,411 $15,596 $18,188
======= ======= =======
</TABLE>

OTHER NONCURRENT LIABILITIES:

Other noncurrent liabilities consisted of the following (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
--------------- JUNE 30,
1994 1995 1996
------- ------- --------
<S> <C> <C> <C>
Legal and environmental............................. $ 1,600 $ 8,568 $ 8,502
Post-retirement medical benefits.................... 5,404 5,724 5,930
Accrued pension liability........................... 1,697 1,782 1,832
Other............................................... 8,484 4,537 3,436
------- ------- -------
$17,185 $20,611 $19,700
======= ======= =======
</TABLE>

INCOME TAXES:

The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes," which requires recognition of deferred tax
liabilities and assets for the expected future tax consequences of events that
have been included in the financial statements or tax returns. Under this
method, deferred tax liabilities and assets are determined based on the
difference between the financial statement and tax bases of assets and
liabilities using currently enacted tax rates.

COMMON STOCK:

The holder of each share of Class A common stock outstanding is entitled to
one vote per share and the holder of each share of Class B common stock
outstanding is entitled to ten votes per share.

F-9
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

DERIVATIVE FINANCIAL INSTRUMENTS:

The Company's only involvement with derivative financial instruments, none
of which are used for trading purposes, consists of an interest rate cap
agreement and a swap agreement used to hedge against exposure to fluctuations
in interest rates on the Company's term loan and revolving credit facility.
The Company manages exposure to counterparty credit risk by entering into such
transactions with major financial institutions that are expected to perform
under the terms of such agreements. Costs of such agreements are amortized
over the period of the related borrowings and were not material to the Company
as of or for the years ended December 31, 1993, 1994, 1995 and the six months
ended June 30, 1995 and 1996. In addition, at no time during such periods were
such transactions material nor did the Company have a material risk of off-
balance sheet accounting loss.

PRO FORMA NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE AFTER GIVING
EFFECT TO RECAPITALIZATION:

Pro forma net income per common and common equivalent share is computed by
dividing net income by the weighted average number of shares of common and
common stock equivalent shares outstanding, after giving effect to the
recapitalization discussed in Note 10. Common stock issued and common stock
options granted within one year immediately preceding the initial public
offering of common stock, discussed in Note 11, at prices below the public
offering price have been reflected in the net income per share calculation as
if they had been outstanding for all periods presented. Historical net income
per common and common equivalent share is not presented as it is no longer
relevant due to the recapitalization discussed in Note 10.

INTERIM FINANCIAL INFORMATION (UNAUDITED):

The accompanying consolidated balance sheet as of June 30, 1996, and the
consolidated statements of operations, stockholders' investment and cash flows
for the six-month periods ended June 30, 1995 and 1996, are unaudited. In the
opinion of management, such consolidated financial statements include all
adjustments, consisting solely of normal recurring adjustments, necessary for
a fair presentation of results for these interim periods. The results of
operations for the six-month period ended June 30, 1996 are not necessarily
indicative of results to be expected for the entire year.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS:

During the first quarter of 1996, the Company adopted SFAS No. 121 which
requires companies to review long-lived assets and certain identifiable
intangibles for impairment whenever events or changes in circumstances
indicate that the carrying amount of such assets may not be recoverable. The
adoption of SFAS No. 121 did not have a significant impact on the financial
condition or results of operations of the Company.

SFAS No. 123, "Accounting for Stock-Based Compensation" encourages, but does
not require, a fair value based method of accounting for employee stock
options, the sale of stock under the Company's employee stock purchase plan or
similar equity instruments. The Company has elected to continue to measure
compensation cost under Accounting Principles Board Opinion No. 25 (APB No.
25), "Accounting for Stock Issued to Employees" as was previously required,
and to comply with pro forma disclosure of net income and earnings per share
as if the fair value based method of accounting had been applied.

F-10
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

3. ACQUISITION AND DIVESTITURE:

ACQUISITION:

On August 31, 1994, Orscheln Co. (Orscheln), a manufacturer of parking brake
cables and levers and light duty cables, transferred certain assets and
liabilities to Systems. Orscheln received total consideration of approximately
$50.5 million, consisting of 2,206,890 shares of Systems common stock and an
option to purchase up to 14,420 additional shares of Systems Class A common
stock at an exercise price of $1.45 per share with a combined value of
approximately $10.5 million and cash consideration, net of assumed
indebtedness, of approximately $40 million.

The acquisition of Orscheln was accounted for as a purchase. Accordingly,
the assets acquired and liabilities assumed have been recorded at fair value
as of the date of the acquisition. The purchase price in excess of the fair
value of the net assets acquired is included in goodwill in the accompanying
consolidated balance sheets. In July 1995, and as further discussed in Note 9,
the Company increased goodwill and other noncurrent liabilities by
approximately $7 million, based on additional information received about
certain product liability claims assumed in connection with this acquisition.
The results of operations of the acquired business have been included in the
accompanying consolidated financial statements from August 31, 1994, the date
of acquisition.

DIVESTITURE:

On April 2, 1995, the Company sold the net assets of its window regulator
business to Rockwell International Corporation for approximately $18 million
in cash, resulting in a pretax gain of approximately $4.2 million. The results
of operations of the window regulator business have been included in the
accompanying consolidated financial statements through April 2, 1995, the date
of divestiture.

Following are the unaudited pro forma results of operations for the years
ended December 31, 1994 and 1995 and the six months ended June 30, 1995 as if
the aforementioned acquisition and divestiture had occurred at the beginning
of the respective period. The following unaudited pro forma financial
information does not purport to represent what the Company's consolidated
results of operations would actually have been if such transactions in fact
had occurred at such date or to project the Company's results of future
operations (in thousands):

<TABLE>
<CAPTION>
PRO FORMA RESULTS FOR THE PRO FORMA RESULTS
YEARS ENDED DECEMBER 31, FOR THE SIX
------------------------- MONTHS ENDED
1994 1995 JUNE 30, 1995
------------ ------------ -----------------
<S> <C> <C> <C>
Revenues....................... $ 231,509 $ 239,598 $128,738
============ ============ ========
Operating income............... $ 12,787 $ 17,172 $ 10,455
============ ============ ========
Net income..................... $ 6,045 $ 7,602 $ 4,905
============ ============ ========
Net income per common and
common equivalent share....... $ 1.76 $ 1.52 $ .99
============ ============ ========
</TABLE>

F-11
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

4. DEBT:

Debt consisted of the following (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
---------------- JUNE 30,
1994 1995 1996
------- ------- --------
<S> <C> <C> <C> <C>
Term loan, principal and interest due in
quarterly installments through June 30,
2001, interest at the lender's prevailing
reference rate plus up to 0.50% or the
Eurodollar rate plus 0.75% to 1.75% at the
discretion of the Company (6.94% to 8.5%
at December 31, 1995 and 6.6% to 8.25% at
June 30, 1996)............................ $50,000 $37,408 $35,021
Revolving credit facility, due August 31,
2000, interest at the lender's prevailing
reference rate plus up to 0.50% or the
Eurodollar rate plus 0.75% to 1.75% at the
discretion of the Company (6.81% to 8.5%
at December 31, 1995 and 8.25% at June 30,
1996)..................................... 20,000 9,750 6,500
Subordinated promissory notes, payable to
stockholders, due December 31, 2001,
interest due semiannually at 6.93%........ 4,000 4,000 4,000
Other...................................... 766 618 570
------- ------- -------
74,766 51,776 46,091
Less--Current maturities................... (4,654) (5,137) (5,536)
------- ------- -------
$70,112 $46,639 $40,555
======= ======= =======
</TABLE>

Future maturities of long-term debt as of December 31, 1995 are as follows
(in thousands):

<TABLE>
<S> <C>
1996............................. $ 5,137
1997............................. 5,652
1998............................. 5,831
1999............................. 8,023
2000............................. 15,390
Thereafter....................... 11,743
-------
$51,776
=======
</TABLE>

The revolving credit facility provides for borrowings of up to $30 million
and is collateralized by substantially all assets of the Company. Borrowings
are limited to eligible accounts receivable, inventories and tooling work in
process, as defined. The borrowing base limit was $30 million at December 31,
1995 and June 30, 1996. The weighted average interest rate for borrowings
under the revolving credit facility was 8.3 percent for the year ended
December 31, 1994, 8.8 percent for the year ended December 31, 1995 and 7.2
percent for the six months ended June 30, 1996.

The term loan and revolving credit facility contain various restrictive
covenants which, among other matters, require the Company to maintain certain
financial ratios, as defined. The agreement also limits additional
indebtedness, capital expenditures and cash dividends. The Company was in
compliance with all such covenants as of December 31, 1995 and June 30, 1996.

In September 1994, the Company entered into an Interest Expense Limitation
Agreement (Cap Agreement) and an Interest Rate Swap Agreement (Swap Agreement)
related to its term loan and revolving credit facility.

F-12
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
The Cap Agreement has a notional amount of $10 million, provides for payment
to the Company to offset interest expense, in the event the quoted LIBOR rate
exceeds 7.0%, and expires March 30, 1997. The Swap Agreement has a decreasing
notional amount of $20 million at inception, decreasing to $8.6 million at its
September 30, 1999 expiration. The Swap Agreement exchanges the variable
interest rate under the term loan and revolving credit facility described
above for a fixed rate of 6.95% on the notional amount, as defined. Fees paid
under the Cap and Swap Agreements are being amortized over the period of the
related term loan and revolving credit facility. The impact of the Cap and
Swap Agreements were not material to the Company.

The Company issued subordinated promissory notes to certain stockholders of
Systems in connection with the acquisition discussed in Note 3. Proceeds from
the notes were used to pay a portion of the purchase price. The notes are
unsecured.

The Company also has outstanding letters of credit totaling $600,000 at
December 31, 1995 and $1,310,000 at June 30, 1996 for the benefit of its
insurance companies related to workers' compensation coverage.

5. INCOME TAXES:

The provision for income taxes consisted of the following (in thousands):

<TABLE>
<CAPTION>
SIX MONTHS
YEARS ENDED DECEMBER 31, ENDED JUNE 30,
------------------------ --------------
1993 1994 1995 1995 1996
--------------- -------- ------- ------
<S> <C> <C> <C> <C> <C>
Current............................... $ 255 $ 315 $ 1,785 $ 1,309 $1,646
Deferred.............................. 681 1,507 5,067 3,717 1,658
------ -------- -------- ------- ------
Total................................. $ 936 $ 1,822 $ 6,852 $ 5,026 $3,304
====== ======== ======== ======= ======
</TABLE>

A reconciliation of the provision for income taxes at the statutory rates to
the reported income tax provision is as follows (in thousands):

<TABLE>
<CAPTION>
SIX MONTHS
YEARS ENDED DECEMBER 31, ENDED JUNE 30,
------------------------ ---------------
1993 1994 1995 1995 1996
--------------- -------- ------- -------
<S> <C> <C> <C> <C> <C>
Federal provision at statutory
rates............................. $ 698 $ 1,497 $ 5,898 $ 4,358 $ 2,890
Amortization of non-deductible
goodwill.......................... 70 115 255 130 140
State taxes, net of federal
benefit........................... 168 210 685 531 314
Other, net......................... -- -- 14 7 (40)
------ -------- -------- ------- -------
Total.............................. $ 936 $ 1,822 $ 6,852 $ 5,026 $ 3,304
====== ======== ======== ======= =======
</TABLE>

The benefit from the utilization of preacquisition net deferred income tax
assets has been reflected as a reduction of goodwill in the accompanying
consolidated financial statements. As of December 31, 1995 and June 30, 1996,
the Company had remaining acquired net operating loss and alternative minimum
tax credit carryforwards for income tax reporting purposes of approximately $2
million. The Company will record further reductions in goodwill to the extent
such carryforwards are realized in future periods.

F-13
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

As of December 31, 1994 and 1995 and June 30, 1996, the Company had provided
a valuation allowance for its net deferred income taxes as, based on available
evidence, it is more likely than not that net deferred tax assets will not be
realized. A summary of deferred tax assets (liabilities) is as follows (in
thousands):
<TABLE>
<CAPTION>
DECEMBER 31,
------------------ JUNE 30,
1994 1995 1996
-------- -------- --------
<S> <C> <C> <C>
Accrued legal and insurance costs............ $ 4,368 $ 5,387 $ 5,253
Accrued integration reserves................. 2,825 2,078 1,789
Net operating loss and alternative minimum
tax credit carryforwards.................... 1,836 1,375 1,375
Accrued compensation costs................... 767 868 1,017
Post retirement benefit obligations.......... 570 668 686
Inventory.................................... 441 344 366
Other reserves and accruals not deductible
for tax purposes............................ 3,039 1,805 2,403
-------- -------- --------
Deferred tax assets........................ 13,846 12,525 12,889
-------- -------- --------
Depreciation and property basis differences.. (1,306) (1,459) (1,683)
Deferred research and development costs...... (515) (833) (899)
-------- -------- --------
Deferred tax liabilites.................... (1,821) (2,292) (2,582)
-------- -------- --------
Valuation allowance........................ (12,025) (10,233) (10,307)
-------- -------- --------
Net deferred income taxes................ $ -- $ -- $ --
======== ======== ========
</TABLE>

6. MAJOR CUSTOMERS:

The Company sells directly to each of the three major North American
automobile manufacturers and to certain automobile manufacturers operating in
Europe. Following is a summary of customers that accounted for a significant
percentage of consolidated revenues:

<TABLE>
<CAPTION>
YEARS ENDED SIX MONTHS
DECEMBER 31, ENDED JUNE 30,
-------------- --------------
1993 1994 1995 1995 1996
---- ---- ---- ------- -------
<S> <C> <C> <C> <C> <C>
Ford.......................................... 46% 57% 52% 54% 48%
GM............................................ 35 29 35 34 35
Chrysler...................................... 14 9 6 5 10
Toyota........................................ -- 3 5 4 5
--- --- --- ------- -------
95% 98% 98% 97% 98%
=== === === ======= =======
</TABLE>

As of December 31, 1994 and 1995 and June 30, 1996, receivables from these
customers represented 92%, 91% and 95% of total accounts receivable.

The Company had export sales, principally to customers in Canada and Mexico,
of $30,138,000 in 1993, $36,343,000 in 1994, $34,807,000 in 1995 and
$24,307,000 for the six months ended June 30, 1996. These sales require
payment in U.S. dollars.

7. MANAGEMENT AGREEMENT:

Under the terms of a management agreement, the Company paid Hidden Creek
Industries (HCI), an affiliate of the Company, monthly management fees for
certain administrative services. Total management fees of approximately
$500,000 for the year ended December 31, 1993, $554,000 for the year ended
December 31, 1994, $733,000 for the year ended December 31, 1995, $300,000 for
the six months ended June 30, 1995 and $500,000 for the six months ended June
30, 1996 are included in selling, general and administrative expenses in the
accompanying consolidated statements of operations. In addition, the Company
paid fees to HCI of approximately $500,000 in connection with the acquisition
and $250,000 in connection with the divestiture discussed in Note 3.

F-14
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

8. EMPLOYEE BENEFIT PLANS:

PENSION PLANS:

The Company sponsors two defined benefit pension plans which cover certain
employees. The Company's policy is to make annual contributions to the plans
to meet the minimum funding requirements of the Employee Retirement Income
Security Act of 1974.

Net pension expense consisted of the following (in thousands):

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
---------------------------
1993 1994 1995
-------- -------- --------
<S> <C> <C> <C>
Service cost-benefits
earned during the year... $ 388 $ 394 $ 413
Interest cost on projected
benefit obligation....... 194 242 277
Return on plan assets..... (73) (116) (150)
Net amortization and
deferral................. 26 26 26
------- -------- --------
Net pension expense..... $ 535 $ 546 $ 566
======= ======== ========
</TABLE>

Pursuant to Statement of Financial Accounting Standards No. 87, "Employers'
Accounting for Pensions," the Company has recorded deferred pension costs of
$246,000, $220,000 and $194,000 at December 31, 1993, 1994 and 1995 related to
the minimum pension liability, which are classified as other assets in the
accompanying consolidated balance sheets.

The funded status of the Company's plans is as follows (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
--------------
1994 1995
------ ------
<S> <C> <C>
Actuarial present value of:
Vested benefit obligation............................... $1,369 $2,164
====== ======
Accumulated benefit obligation.......................... $2,115 $2,855
====== ======
Projected benefit obligation............................ $3,473 $3,987
Plan assets at fair value................................. 1,704 2,305
------ ------
Projected benefit obligation in excess of plan assets... 1,769 1,682
Unrecognized net loss..................................... (201) (18)
Prior service cost........................................ (220) (194)
Adjustment to recognize minimum liability................. 349 312
------ ------
Accrued pension costs................................... $1,697 $1,782
====== ======
</TABLE>

The accumulated and projected benefit obligations were determined using an
assumed discount rate of 8% at December 31, 1994 and 7.5% at December 31,
1995. The assumed long-term rate of return on assets was 8% at December 31,
1994 and 7.5% at December 31, 1995. Plan assets consist principally of common
stock, fixed income securities and guaranteed investment contracts.

RETIREMENT SAVINGS PLANS:

The Company sponsors employee retirement savings plans which allow qualified
employees to provide for their retirement on a tax-deferred basis. In
accordance with the terms of the retirement savings plans, the Company is
required to match certain of the participants' contributions and/or provide
employer contributions

F-15
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

based on the Company's performance. Such matching contributions totaled
$95,000, $419,000 and $976,000 during fiscal 1993, 1994 and 1995 and $525,000
and $665,000 for the six months ended June 30, 1995 and 1996.

POSTRETIREMENT BENEFITS OTHER THAN PENSIONS:

The Company has various postretirement medical benefit plans for certain
employee groups and has recorded a liability for its estimated obligations
under these plans.

Net periodic postretirement benefit cost is as follows (in thousands):

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------
1993 1994 1995
-------- -------- --------
<S> <C> <C> <C>
Service cost-benefits earned during the year...... $ 45 $ 54 $ 74
Interest cost on projected benefit obligation..... 424 529 679
Net amortization and deferral..................... -- 93 124
-------- -------- --------
Net periodic postretirement benefit cost........ $ 469 $ 676 $ 877
======== ======== ========
</TABLE>

The funded status of the Company's plans is as follows (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
----------------
1994 1995
------- -------
<S> <C> <C>
Accumulated benefit obligation......................... $ 7,527 $ 7,738
Plan assets at fair value.............................. -- --
------- -------
Projected benefit obligation in excess of plan
assets.............................................. 7,527 7,738
Unrecognized net loss.................................. (2,123) (2,014)
------- -------
Accrued postretirement benefits...................... $ 5,404 $ 5,724
======= =======
</TABLE>

For measurement purposes, a 9% annual rate of increase for the healthcare
cost trend was assumed for 1995. The rate was assumed to decrease 1% annually
to 5% at 2000 and remain level thereafter. Increasing the assumed healthcare
cost trend assumption by one percentage point would increase the accumulated
postretirement benefit obligation by approximately $491,000 and the net
periodic postretirement expense by approximately $46,000 for the year ended
December 31, 1995.

9. COMMITMENTS AND CONTINGENCIES:

ORSCHELN SERVICE AND SUPPLY AGREEMENTS:

In connection with the acquisition discussed in Note 3, the Company entered
into agreements with Orscheln whereby the Company is to receive services
related to data processing, payroll and personnel administration, and other
administrative matters. Amounts paid under these service agreements were
$570,000 and $1,788,000 for the years ended December 31, 1994 and 1995 and
$370,000 for the six months ended June 30, 1996. Future minimum commitments
under the service agreements are approximately $400,000 in 1996. In addition,
the Company and Orscheln have mutually agreed to supply each other's
operations with certain items necessary for the manufacture of their products.
These supply agreements are for periods of up to five years and are at terms
which the Company believes are no less favorable than could be obtained from
an independent party.

F-16
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

LEASES:

The Company leases office and manufacturing space and certain equipment
under operating lease agreements which require it to pay maintenance,
insurance, taxes and other expenses in addition to annual rentals. Future
annual rental commitments at December 31, 1995 under these operating leases
are as follows (in thousands):

<TABLE>
<CAPTION>
AMOUNT
YEAR ------
<S> <C>
1996................................................................ $1,091
1997................................................................ 689
1998................................................................ 534
1999................................................................ 401
2000................................................................ 423
Thereafter.......................................................... 1,569
------
$4,707
======
</TABLE>

STOCK PURCHASE PLAN:

The Company maintains a plan which allows for the sale of shares of the
Company's Class B common stock, either directly or through the granting of
options to certain employees. Eligible employees and the terms of such sales
or options are as determined by the Company's board of directors. During 1994,
1995 and the six months ended June 30, 1996, the Company sold 42,070, 149,325
and 0 shares of its common stock to management and repurchased 44,980, 46,204
and 9,053 shares of its common stock from management at estimated fair market
value, as determined under the terms of this plan.

STOCK OPTIONS:

During 1993, MCHC issued an option to purchase 17,625 shares of Class B
common stock to an outside consultant who can exercise the options at any time
while still associated with the Company for up to ten years, at a price of
$1.45 per share. In connection with the acquisition discussed in Note 3, this
option was exchanged for an option to purchase 17,625 shares of Systems common
stock at terms similar to those discussed above.

As discussed in Note 3, an option to purchase up to 14,420 shares of Systems
Class B common stock, at a price of $1.45 per share, was granted to Orscheln
in connection with the acquisition. The option is exercisable for up to ten
years or the date of exercise of the option discussed above, which ever occurs
earlier.

PRODUCT WARRANTY AND CLAIMS:

In connection with the acquisition discussed in Note 3, the Company agreed
to assume the liability for two potential product recalls by a customer,
related to two parking brake systems manufactured by Orscheln. The customer
has agreed to limit the liability of the Company in connection with the
potential recalls to $7 million. In fiscal 1994, the Company recorded a
reserve for its full obligation related to the liability associated with these
recalls in the accounting for the purchase of Orscheln. As of June 30, 1996,
the Company has reimbursed the customer approximately $6.5 million for such
costs.

In addition, the Company indemnified Orscheln for certain preacquisition
product liability claims brought against Orscheln and/or a customer. Based
upon the receipt of additional information regarding the number and severity
of claims, the Company, in July 1995, increased goodwill and noncurrent
liabilities by approximately $7 million. The Company believes the reserves are
adequate to cover its potential liability for these claims and any potential
future liabilities.

LITIGATION:

The Company is party to certain claims arising in the ordinary course of
business. In the opinion of management, based upon the advice of legal
counsel, the outcomes of such claims are not expected to be material to the
Company.

F-17
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

ENVIRONMENTAL MATTERS:

Due to the nature of its business, the Company may, from time to time, be
exposed to potential liabilities to clean up environmental contaminants. The
Company has been named as one of four potentially responsible parties related
to groundwater contamination in East Jordan, Michigan, that was in existence
at the date of the Company's formation. The Company has provided reserves
which management believes are adequate to cover any exposure related to this
matter, and the Company's former owners have agreed to indemnify the Company
for any costs in excess of the provided reserves.

10. RECAPITALIZATION:

In connection with the Offering discussed in Note 11, the Company's board of
directors and stockholders have approved a 17.625 for 1 stock split and
approved a recapitalization pursuant to which the shares of the Company's
Class A, B and C common stock were converted into shares of new Class B Common
Stock. The allocation of shares of Common Stock among existing stockholders
was in accordance with the resolutions of the Company's stockholders
containing conversion ratios which were arrived at by applying an established
formula based upon the stockholders' initial capital contributions, relative
preference ranking and the initial public offering price of the Common Stock.
The Company's board of directors and stockholders also approved an increase in
the number of authorized shares to 30,000,000 Class A common shares and
10,000,000 Class B common shares. These actions were contingent upon and
occurred immediately prior to the Offering. The accompanying consolidated
financial statements have been retroactively restated to give effect to the
stock split.

11. INITIAL PUBLIC OFFERING AND STOCK OPTION AND PURCHASE PLANS:

INITIAL PUBLIC OFFERING:

On June 21, 1996, the Company's board of directors approved the filing of a
Form S-1 Registration Statement with the Securities and Exchange Commission
for the sale of 2,700,000 shares of the Company's Class A common stock to the
public (the Offering).

The Company intends to use the proceeds of the Offering to repay certain
outstanding indebtedness.

STOCK OPTION PLAN:

In May 1996, the Company's board of directors approved an employee stock
option plan that provides for the issuance of options to acquire up to 600,000
shares of the Company's Class A common stock. The exercise price of the
options will be at least 100% of the fair market value of the Company's Class
A common stock at the time of the issuance of options.

EMPLOYEE STOCK PURCHASE PLAN:

In May 1996, the Company's board of directors approved an employee stock
discount purchase plan that reserves 500,000 shares of the Company's Class A
common stock for sale to employees at discounted purchase prices, subject to
certain limitations. The cost per share under this plan will be 85% of the
market value of the Company's Class A common stock, as defined.

INDEPENDENT DIRECTOR STOCK OPTION PLAN:

In May 1996, the Company's board of directors approved an independent
director stock option plan that provides for the issuance of options to
acquire up to 100,000 shares of the Company's Class A common stock. The
exercise price of the options will be at least 100% of the fair market value
of the Company's Class A common stock at the time of the issuance of the
options.

F-18
<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

12. QUARTERLY FINANCIAL DATA (UNAUDITED):

The following is a condensed summary of actual quarterly results of
operations for 1994, 1995 and the first half of 1996 (in thousands except per
share amounts):

<TABLE>
<CAPTION>
NET INCOME
PER COMMON
AND COMMON
GROSS OPERATING EQUIVALENT
REVENUES PROFIT INCOME NET INCOME SHARE
-------- ------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C>
1994:
First........................ $ 33,881 $ 2,381 $ 513 $ 64 $ .02
Second....................... 37,732 3,558 1,305 455 .17
Third........................ 43,973 3,836 1,393 210 .06
Fourth....................... 74,089 9,152 4,664 1,851 .38
-------- ------- ------- -------
$189,675 $18,927 $ 7,875 $ 2,580 $ .75
======== ======= ======= =======
1995:
First........................ $ 80,707 $ 9,019 $ 5,607 $ 2,442 $ .50
Second....................... 62,159 9,117 5,236 4,984 1.00
Third........................ 51,426 5,568 1,833 417 .08
Fourth....................... 59,434 9,748 4,884 2,283 .45
-------- ------- ------- -------
$253,726 $33,452 $17,560 $10,126 $2.03
======== ======= ======= =======
1996:
First........................ $ 59,303 $ 7,462 $ 3,336 $ 1,347 $ .27
Second....................... 68,054 10,754 6,822 3,607 .72
-------- ------- ------- -------
$127,357 $18,216 $10,158 $ 4,954 $ .99
======== ======= ======= =======
</TABLE>

The sum of net income per common and common equivalent share for each of the
fiscal 1994 quarters does not agree with the total per share for the year due
to the timing of the Offering and its effects on the computation of weighted
average number of shares outstanding.

F-19
<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Orscheln Co.:

We have audited the accompanying statements of operations and cash flows of
Orscheln Automotive Business Unit (an operating unit of Orscheln Co.--see Note
1 of Notes to Financial Statements) for the year ended December 31, 1993 and
the eight-month period ended August 31, 1994. These financial statements are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, Orscheln Automotive Business Unit's results of
operations and its cash flows for the year ended December 31, 1993 and the
eight-month period ended August 31, 1994, in conformity with generally
accepted accounting principles.

ARTHUR ANDERSEN LLP

Kansas City, Missouri,
May 20, 1996

F-20
<PAGE>

ORSCHELN AUTOMOTIVE BUSINESS UNIT
(AN OPERATING UNIT OF ORSCHELN CO.)

STATEMENTS OF OPERATIONS

(IN THOUSANDS)

<TABLE>
<CAPTION>
EIGHT-MONTH
PERIOD
YEAR ENDED ENDED
DECEMBER 31, AUGUST 31,
1993 1994
------------ -----------
<S> <C> <C>
Revenues (Notes 2 and 3)............................... $132,873 $104,816
Cost of sales.......................................... 125,183 93,220
-------- --------
Gross profit......................................... 7,690 11,596
Selling, general and administrative expenses........... 10,492 6,979
-------- --------
Operating income (loss).............................. (2,802) 4,617
Interest expense (Notes 3 and 4)....................... (1,167) (1,113)
Other expense, net..................................... (245) --
-------- --------
Net income (loss).................................... $ (4,214) $ 3,504
======== ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-21
<PAGE>

ORSCHELN AUTOMOTIVE BUSINESS UNIT
(AN OPERATING UNIT OF ORSCHELN CO.)

STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<TABLE>
<CAPTION>
EIGHT-MONTH
PERIOD
YEAR ENDED ENDED
DECEMBER 31, AUGUST 31,
1993 1994
------------ -----------
<S> <C> <C>
Operating Activities:
Net income (loss)................................... $(4,214) $ 3,504
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities--
Depreciation and amortization..................... 4,744 2,782
Change in operating items:
Accounts receivable, net........................ (2,731) (4,222)
Receivables from affiliates..................... (826) 655
Unbilled customer tooling....................... (496) 1,597
Inventories..................................... (595) 2,471
Other assets.................................... 312 157
Accounts payable and accrued liabilities........ 2,092 1,849
------- --------
Net cash provided by (used in) operating
activities................................... (1,714) 8,793
------- --------
Investing Activities:
Capital expenditures, net........................... (7,533) (2,601)
Increase in pooled investments...................... -- (8,503)
------- --------
Net cash used in investing activities......... (7,533) (11,104)
------- --------
Financing Activities:
Principal payments on long-term debt................ (4,449) (2,328)
Proceeds from issuance of long-term debt............ 13,500 --
Increase (decrease) in line of credit............... (1,750) 3,450
Increase in affiliate notes payable................. 1,949 1,190
------- --------
Net cash provided by financing activities..... 9,250 2,312
------- --------
Net increase in cash and cash equivalents..... 3 1
Cash and Cash Equivalents, beginning of period........ 7 10
------- --------
Cash and Cash Equivalents, end of period.............. $ 10 $ 11
======= ========
Supplemental Disclosure--
Cash paid for interest.............................. $ 1,099 $ 1,043
======= ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-22
<PAGE>

ORSCHELN AUTOMOTIVE BUSINESS UNIT
(AN OPERATING UNIT OF ORSCHELN CO.)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1993 AND AUGUST 31, 1994

1. ORGANIZATION AND BASIS OF PRESENTATION:

Orscheln Automotive Business Unit (the Company) is an operating unit of
Orscheln Co., a Delaware corporation. The Company's principal operations
include the manufacture and marketing of mechanical control assemblies and
component parts to North American original equipment manufacturers of
automotive vehicles, after market distributors and first tier suppliers to
automotive manufacturers.

On August 31, 1994, Orscheln Co. entered into an agreement whereby
stockholders of MC Holding Corp. (MCHC) contributed all shares of MCHC common
stock to Dura Automotive Holding, Inc. (Dura) in return for shares of Dura
common stock. Orscheln Co. transferred certain assets and liabilities of the
Company to Dura in return for 125,214 shares of Dura common stock, an option
to purchase up to 818.18 additional shares of Dura common stock and cash
consideration, net of assumed indebtedness, of approximately $40 million.

In February 1996, Orscheln Co. changed its name to Alkin Co.

2. SIGNIFICANT ACCOUNTING POLICIES:

Fiscal Year:

The Company has adopted a 52-/53-week fiscal year. For presentation
purposes, the Company uses December 31 as the fiscal year end.

Use of Estimates:

The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the
reporting period. Ultimate results could differ from those estimates.

Inventories:

Inventories are valued at the lower of cost or market. The last-in, first-
out (LIFO) method of determining costs is used. Cost includes material, labor
and manufacturing overhead required in the production of the Company's
products. During 1994, inventory quantities were reduced, which resulted in a
liquidation of LIFO quantities recorded at lower costs prevailing in prior
years as compared to the cost of 1994 purchases. The effect was not material
to the results of operations for 1994.

Property, Plant and Equipment:

Property, plant and equipment are stated at cost. Predominately all
depreciation is computed using the straight-line method over the following
estimated useful lives:

<TABLE>
<S> <C>
Buildings and improvements.................................. 3 to 20 years
Machinery and equipment..................................... 3 to 10 years
Office furniture and fixtures............................... 3 to 10 years
Vehicles.................................................... 3 to 5 years
</TABLE>

Income Taxes:

The Company is an operating unit of Orscheln Co., a subchapter S corporation
as defined under the Internal Revenue Code. Under S status, the taxable income
or loss of Orscheln Co. is included in the taxable income of its stockholders.

F-23
<PAGE>

ORSCHELN AUTOMOTIVE BUSINESS UNIT

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

Research and Development:

Research and development expenses were approximately $1,986,000 and
$1,212,000 for the year ended December 31, 1993 and the eight-month period
ended August 31, 1994, respectively, and were charged to expense as incurred.

Major Customers:

The Company sells directly to two major North American automobile
manufacturers. Sales to these customers for the year ended December 31, 1993
and the eight-month period ended August 31, 1994, accounted for a significant
percentage of revenue.

<TABLE>
<CAPTION>
1993 1994
---- ----
<S> <C> <C>
Ford.......................... 66% 62%
General Motors................ 28 32
--- ---
94% 94%
=== ===
</TABLE>

Statements of Cash Flows:

Cash equivalents consist of money market instruments with original
maturities of three months or less and are stated at cost which approximates
fair value.

3. TRANSACTIONS WITH AFFILIATES:

The Company has transactions with stockholders and companies that are
affiliated through common ownership and management. A summary of significant,
related-party transactions not disclosed elsewhere in the financial statements
or notes is as follows:

Interest Expense:

Interest expense incurred on notes payable to affiliates was approximately
$403,000 and $327,000 for the year ended December 31, 1993 and for the eight-
month period ended August 31, 1994, and respectively.

Payments to Affiliated Companies

Significant payments to affiliated companies for the year ended December 31,
1993 and the eight-month period ended August 31, 1994, were as follows:

. Orscheln Management Co. provides administrative, management, payroll,
human resources and other services to the Company, for which the Company
paid $4,496,000 for the year ended December 31, 1993 and $3,097,000 for
the eight-month period ended August 31, 1994.

. Computerized Business Systems, Inc., provides data processing services
to the Company, for which the Company paid $1,099,000 for the year ended
December 31, 1993 and $1,151,000 for the eight-month period ended August
31, 1994.

. Suratco Products Co. supplies the Company with component parts, for
which the Company paid $1,811,000 for the year ended December 31, 1993
and $0 for the eight-month period ended August 31, 1994.

. Utility Air, Inc., provides air transportation services and other travel
services to the Company, for which the Company paid $850,000 for the
year ended December 31, 1993 and $424,000 for the eight-month period
ended August 31, 1994.

F-24
<PAGE>

ORSCHELN AUTOMOTIVE BUSINESS UNIT

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

. American Third Century Co. provides risk-management services and sells
insurance to the Company, for which the Company paid $560,000 for the
year ended December 31, 1993 and $386,000 for the eight-month period
ended August 31, 1994.

. The Company paid Orscheln Industries Health Plan Trust $2,928,000 for
the year ended December 31, 1993 and $1,967,000 for the eight-month
period ended August 31, 1994.

. The Company made payments to other affiliated companies of $906,000 for
the year ended December 31, 1993 and $511,000 for the eight-month period
ended August 31, 1994. These payments were primarily for building
improvements, employee payroll deductions, production tooling and
miscellaneous transportation costs.

Sales to Affiliates

Sales to affiliated companies were $3,859,000 for the year ended December
31, 1993 and $2,000,000 for the eight-month period ended August 31, 1994.

4. NOTES PAYABLE:

The Company has a bank line of credit and a term loan with an institutional
lender that bears interest at the prime rate and notes payable and capitalized
lease obligations which bear interest at rates ranging from 5 percent to 10.85
percent.

<TABLE>
<CAPTION>
DECEMBER 31, AUGUST 31,
1993 1994
------------ ----------
(IN THOUSANDS)
<S> <C> <C>
10.85% unsecured note payable, payable in monthly
installments of principal and interest of $33,000
through February 1994................................ $ 64 $ --
6% capitalized lease obligation secured by lease
improvements, interest payable semiannually and
principal payable annually in amounts varying from
$60,000 to $80,000 through September 30, 1996........ 230 230
5% unsecured notes payable to a municipality payable
in monthly installments of principal and interest of
less than $1,000 maturing in March 1996 and November
2000................................................. 73 64
5% notes payable to a state agency secured by a deed
of trust, payable in monthly installments of
principal and interest varying form $2,000 to $3,000
maturing August 1997 through August 2002............. 340 308
5% subordinated note payable to a municipality,
secured by a deed of trust payable in monthly
installments of principal and interest of $3,000
beginning February 1995 through February 2005........ 270 270
Unsecured note payable to an institutional lender,
payable in equal monthly principal installments of
$278,000 through July 1996 plus interest at prime
(7.75% at August 31, 1994)........................... 9,167 6,944
------- ------
10,144 7,816
Less--Current maturities.............................. 3,535 3,485
------- ------
Total............................................. $ 6,609 $4,331
======= ======
</TABLE>

F-25
<PAGE>

ORSCHELN AUTOMOTIVE BUSINESS UNIT

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

5. LEASES:

The Company leases certain equipment and facilities under operating leases
which expire through 1998. Rental expense was $525,000 and $374,000 for the
year ended December 31, 1993 and the eight-month period ended August 31, 1994,
respectively. Future minimum lease payments for noncancelable leases as of
August 31, 1994, are as follows (in thousands):

6. EMPLOYEE BENEFIT PLAN:

The Company participates in the Orscheln Industries Retirement Program, a
defined contribution plan (the Plan). Employees who have completed one year of
service may participate in the Plan. Participants may contribute 1 percent to
15 percent of their gross earnings and the Company is required to match 50
percent of the contribution up to 2 percent of gross earnings. The Company
contributes an additional 3 percent of the participant's gross earnings to
those employees who have completed two years or more of service.

Company contributions to the Plan were approximately $880,000 and $675,000
during the year ended December 31, 1993 and the eight-month period ended
August 31, 1994, respectively.

7. PRO FORMA FINANCIAL INFORMATION (UNAUDITED):

The unaudited pro forma financial information is provided to show the
significant effects on the historical financial information had the Company
operated as a C corporation throughout all periods presented. Income taxes
have been computed at the federal statutory rate of 34 percent.

<TABLE>
<CAPTION>
EIGHT-MONTH
YEAR ENDED PERIOD ENDED
DECEMBER 31, 1993 AUGUST 31, 1994
----------------- ---------------
(IN THOUSANDS)
<S> <C> <C>
Unaudited pro forma information--
Income (loss) before provision for
income taxes....................... $(4,214) $3,504
Provision for income taxes.......... -- 1,191
------- ------
Net income (loss)................. $(4,214) $2,313
======= ======
</TABLE>

F-26
<PAGE>

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY IN-
FORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY OF THE UNDER-
WRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITA-
TION OF AN OFFER TO BUY THE SHARES BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING THE OF-
FER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.

-------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
<S> <C>
Prospectus Summary....................................................... 3
Risk Factors............................................................. 8
The Company.............................................................. 12
Use of Proceeds.......................................................... 12
Dividend Policy.......................................................... 12
The Recapitalization..................................................... 13
Dilution................................................................. 14
Capitalization........................................................... 15
Selected Consolidated Financial Data..................................... 16
Management's Discussion and Analysis of Results of Operations and
Financial Condition..................................................... 18
Business................................................................. 24
Management............................................................... 33
Certain Transactions..................................................... 39
Principal Stockholders................................................... 40
Description of Capital Stock............................................. 42
Shares Eligible for Future Sale.......................................... 45
Underwriting............................................................. 47
Legal Matters............................................................ 48
Experts.................................................................. 48
Additional Information................................................... 48
Index to Financial Statements............................................ F-1
</TABLE>

-------------

UNTIL , 1996 (25 DAYS AFTER THE COMMENCEMENT OF THIS OFFERING), ALL DEAL-
ERS EFFECTING TRANSACTIONS IN THE CLASS A COMMON STOCK, WHETHER OR NOT PARTIC-
IPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS
IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING
AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

2,700,000 SHARES

LOGO

DURA AUTOMOTIVE
SYSTEMS, INC.

CLASS A COMMON STOCK

----------------

PROSPECTUS

----------------

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION

MORGAN STANLEY & CO.
INCORPORATED

ROBERT W. BAIRD & CO.
INCORPORATED

, 1996

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following is a statement of the expenses of the issuance and
distribution of the securities being registered other than underwriting
compensation, all of which are estimates with the exception of the Securities
and Exchange Commission fee and the National Association of Securities Dealers
fee and all of which will be paid by the Company:

<TABLE>
<S> <C>
Securities and Exchange Commission registration fee.............. $17,131
National Association of Securities Dealers, Inc. fee............. 5,468
Nasdaq National Market listing fee............................... 20,525
Blue sky fees and expenses (including attorneys' fees and
expenses)....................................................... *
Printing and engraving expenses.................................. *
Transfer agent's fees and expenses............................... *
Accounting fees and expenses..................................... *
Legal fees and expenses.......................................... *
Miscellaneous expenses........................................... *
-------
Total.......................................................... $ *
=======
</TABLE>
- ---------------------
* To be filed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Company is incorporated under the laws of the State of Delaware. Section
145 of the General Corporation Law of the State of Delaware ("Section 145")
provides that a Delaware corporation may indemnify any persons who are, or are
threatened to be made, parties to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of such corporation), by reason of
the fact that such person was an officer, director, employee or agent of
another corporation or enterprise. The indemnity may include expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action
or proceeding, had no reasonable cause to believe that his conduct was
illegal. A Delaware corporation may indemnify any persons who are, or are
threatened to be made, a party to any threatened, pending or completed action
or suit by or in the right of the corporation by reason of the fact that such
person was a director, officer, employee or agent of such corporation, or is
or was serving at the request of such corporation as a director, officer,
employee or agent of another corporation or enterprise. The indemnification
may include expenses (including attorneys' fees) actually and reasonably
incurred by such person in connection with the defense or settlement of such
action or suit, provided such person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the corporation's best
interests except that no indemnification is permitted without judicial
approval if the officer or director is adjudged to be liable to the
corporation. Where an officer or director is successful on the merits or
otherwise in the defense of any action referred to above, the corporation must
indemnify him against the expenses which such officer or director has actually
and reasonably incurred.

The Company's Restated Certificate will provide for the indemnification of
directors and officers of the Company to the fullest extent permitted by
Section 145.

In that regard, the Restated Certificate will provide that the Company shall
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, administrative or investigative (other than action by or in the right
of the corporation) by reason of the fact that he is or was a director or
officer of the Company, or is or was serving at the request of the Company as
a director, officer or member of another corporation, partnership, joint
venture, trust or other

II-1
<PAGE>

enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best
interests of such corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
Indemnification in connection with an action or suit by or in the right of such
corporation to procure a judgment in its favor will be limited to payment of
expenses (including attorneys' fees) actually and reasonably incurred in
connection with the defense or settlement of such an action or suit except that
no such indemnification may be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the indemnifying corporation
unless and only to the extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall determine that, despite
the adjudication of liability but in consideration of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the court shall deem proper.

The Company has in effect insurance policies covering all of the Company's
directors and officers in certain instances where by law they may not be
indemnified by the Company.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Since its incorporation in August 1994, the Company has not sold any
securities not registered under the Securities Act, except as follows:

(i) On August 31, 1994 and in connection with its initial capitalization,
after giving effect to the Recapitalization (as defined in the Prospectus),
the Company issued an aggregate of 494,185 shares of Class A Common Stock,
1,762,500 shares of Class B Common Stock and 440,625 shares of Class C
Common Stock to the former stockholders of MC Holding Corp. ("MCHC") in
exchange for all of their outstanding MCHC common stock. Concurrently, the
Company issued 2,206,890 shares of Class B Common Stock together with an
option to purchase 14,420 additional shares of Class B Common Stock to
Alkin Co. as partial consideration for its Brake and Cable Business (as
defined in the Prospectus).

(ii) On June 26, 1995, after giving effect to the Recapitalization, the
Company sold an aggregate of 78,819 shares of its Class B Common Stock to
certain employees of the Company at a price equal to $2.69 per share and
70,500 shares of its Class B Common Stock to certain employees of the
Company at a price equal to $1.96 per share, pursuant to agreements entered
into in May 1995 and in August and September 1994, respectively.

The sale and issuances of the securities listed above in paragraphs (i) and
(ii) were deemed to be exempt from registration under the Securities Act by
virtue of Section 4(2) thereof and Regulation D promulgated thereunder as
transactions not involving a public offering.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits.

<TABLE>
<CAPTION>
NUMBER DESCRIPTION
------ -----------
<C> <S>
1 Form of Underwriting Agreement
3.1* Form of Amended and Restated Certificate of Incorporation of the
Company
3.2* Form of Amended and Restated By-laws of the Company
4.1* Stockholders Agreement, dated as of August 31, 1994, by and among
the Company, Onex U.S. Investments, Inc., J2R, Alkin, the HCI
Stockholders (as defined therein) and the Management
Stockholders (as defined therein)
4.2* Amendment to Stockholders Agreement, dated May 17, 1995, by and
between the Company, Onex DHC LLC, J2R, Alkin, the HCI
Stockholders (as defined therein) and the Management
Stockholders (as defined therein)
</TABLE>

II-2
<PAGE>

<TABLE>
<CAPTION>
NUMBER DESCRIPTION
------ -----------
<C> <S>
4.3* Registration Agreement, dated as of August 31, 1994, among the
Company, Alkin and the MC Stockholders (as defined therein)
4.4* Amendment to Registration Agreement, dated May 17, 1995, by and
between the Company, the MC Stockholders (as defined therein) and
Alkin
4.5* Investor Stockholder Agreement, dated as of August 31, 1994, by and
among the Company, Onex U.S. Investments, Inc., J2R and certain
other stockholders party thereto
4.6 Form of certificate representing Class A Common Stock of the Company
5* Opinion and Consent of Kirkland & Ellis
10.1* Joint Venture Agreement, dated as of August 31, 1994, by and among
the Company, Alkin, MCHC, Onex and J2R. The Company agrees to
furnish supplementally to the Commission a copy of any omitted
schedule or exhibit to the Agreement upon request by the Commission.
10.2* Management Contribution Agreement, dated as of August 31, 1994, by
and among the Company, Kim B. Clark and the Management Stockholders
(as defined therein)
10.3* Management Agreement, dated as of August 31, 1994, by and between
Hidden Creek and Dura Operating Corp. (formerly known as Dura
Automotive Systems, Inc.) ("Dura Operating")
10.4* Stock Option Agreement, dated as of August 31, 1994, between the
Company and Alkin
10.5* Stock Option Agreement, dated as of August 31, 1994, between the
Company and Kim B. Clark
10.6* Subordinated Promissory Note, dated August 31, 1994, of the Company
in the amount of $2,000,000 in favor of Alkin
10.7* Subordinated Promissory Note, dated August 31, 1994, of MCHC in the
amount of $1,800,000 in favor of Onex Ohio Holdings, Inc.
10.8* Subordinated Promissory Note, dated August 31, 1994, of MCHC in the
amount of $200,000 in favor of J2R
10.9* Credit Agreement, dated as of August 31, 1994, among Dura Operating,
certain commercial lending institutions, The Bank of Nova Scotia,
Comerica Bank, The Chase Manhattan Bank and Continental Bank
10.10* Security Agreement, dated as of August 31, 1994, between Dura
Operating and Continental Bank, as agent
10.11* Pledge Agreement, dated as of August 31, 1994, entered into by Dura
Operating in favor of Continental Bank, as agent
10.12* Guaranty, dated August 31, 1994, by Dura de Mexico S.A. de C.V.
("Dura Mexico") in favor of the Agents, the Co-Agents and the
Lenders (each as defined therein)
10.13* Accounts Receivable Pledge Agreement, dated as of August 31, 1994, by
and between Continental Bank, as agent, and Dura Mexico
10.14* Corporate Guaranty, dated August 31, 1994, by MCHC in favor of the
Agent, Co-Agents and Lenders (each as defined therein)
10.15* Pledge Agreement, dated as of August 31, 1994, by MCHC in favor of
Continental Bank, as agent
10.16* Letter Agreement, dated August 25, 1994, between the Company and Ford
10.17* Promissory Note, dated December 31, 1991, of Karl F. Storrie in favor
of Continental Bank, as agent
10.18* Asset Purchase Agreement, dated March 23, 1995, by and among Dura
Operating, the Company and Rockwell International Corporation. The
Company agrees to furnish supplementally to the Commission a copy of
any omitted schedule or exhibit to the Agreement upon request by the
Commission.
</TABLE>

II-3
<PAGE>

<TABLE>
<CAPTION>
NUMBER DESCRIPTION
------ -----------
<C> <S>
10.19* Subscription Agreement, dated as of June 26, 1995, by and between
the Company and the persons listed on the signature pages thereto
10.20* Subscription Agreement, dated as of June 26, 1995, by and between
the Company, David P. Klosterman and Craig L. Lamiman
10.21* Letter Agreement, dated November 9, 1995, between the Company and
John J. Knappenberger
10.21.1* Letter Agreement, dated August 16, 1994, between the Company and
Craig L. Lamiman
10.21.2* Letter Agreement, dated September 1, 1994, between the Company and
David P. Klosterman
10.22* Lease, entered into as of January 5, 1988, between the City of
Moberly, Missouri and Alkin
10.23* Net Lease, made as of March 16, 1995, by and between First
Industrial Financing Partnership, L.P. ("First Industrial") and
Dura Operating
10.24* First Addendum to Net Lease, dated April 24, 1995, between First
Industrial and Dura Operating
10.25* Lease of Office Space, dated June 14, 1991, between 80 South Eighth
Street Limited Partnership ("Eighth Street") and Hidden Creek
10.26* Amendment and Renewal of Lease, made as of April 30, 1993, by and
between Eighth Street and Hidden Creek
10.27 Form of 1996 Key Employee Stock Option Plan
10.28 Form of Independent Director Stock Option Plan
10.29 Form of Employee Stock Discount Purchase Plan
10.30* Form of Amended and Restated Stockholders Agreement
10.31* Form of Amended and Restated Investor Stockholders Agreement
21* Subsidiaries of the Company
23.1 Consent of Arthur Andersen LLP, Minneapolis, Minnesota
23.2 Consent of Arthur Andersen LLP, Kansas City, Missouri
23.3* Consent of Kirkland & Ellis (included in Exhibit 5)
24* Powers of Attorney
27 Financial Data Schedule
</TABLE>
- ---------------------

*Previously filed.

All other schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are not required under
the related instructions, are inapplicable or not material, or the information
called for thereby is otherwise included in the financial statements and
therefore has been omitted.

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes to provide to the underwriter
at closing specified in the underwriting agreement certificates in such
denominations and registered in such names as requested by the underwriter to
permit prompt delivery to each purchaser.

The undersigned registrant hereby undertakes:

(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

II-4
<PAGE>

(2) For purposes of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Securities Act") may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.

II-5
<PAGE>

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS AMENDMENT NO. 2 TO REGISTRATION STATEMENT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF
ROCHESTER HILLS, STATE OF MICHIGAN ON AUGUST 6, 1996.

Dura Automotive Systems, Inc.

/s/ Karl F. Storrie
By: _________________________________
KARL F. STORRIE
PRESIDENT AND CHIEF EXECUTIVE
OFFICER

* * * *

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
NO. 2 TO REGISTRATION STATEMENT AND POWER OF ATTORNEY HAVE BEEN SIGNED BY THE
FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED:

<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
<S> <C> <C>

/s/ Karl F. Storrie President, Chief Executive August 6, 1996
_________________________________ Officer and Director
KARL F. STORRIE (principal executive officer)

/s/ David R. Bovee Vice President and Chief August 6, 1996
_________________________________ Financial Officer (principal
DAVID R. BOVEE financial officer)

/s/ S.A. Johnson Chairman of the Board and August 6, 1996
_________________________________ Director
S.A. JOHNSON

/s/ Robert R. Hibbs Vice President and Director August 6, 1996
_________________________________
ROBERT R. HIBBS

/s/ Neil Anderson Director August 6, 1996
_________________________________
NEIL ANDERSON

/s/ W. H. Clement Director August 6, 1996
_________________________________
W. H. CLEMENT

/s/ James O'Loughlin Director August 6, 1996
_________________________________
JAMES O'LOUGHLIN

/s/ William L. Orscheln Director August 6, 1996
_________________________________
WILLIAM L. ORSCHELN

/s/ Eric J. Rosen Director August 6, 1996
_________________________________
ERIC J. ROSEN

/s/ Barbara A. Westhues Director August 6, 1996
_________________________________
BARBARA A. WESTHUES
</TABLE>

II-6

<PAGE>

Draft: 8/1/96

2,700,000 Shares

DURA AUTOMOTIVE SYSTEMS, INC.

Class A Common Stock

UNDERWRITING AGREEMENT
-----------------------

__________, 1996

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
ROBERT W. BAIRD & CO.
INCORPORATED
As representatives of the
several underwriters
named in Schedule I hereto
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
140 Broadway
New York, New York 10005

Dear Sirs:

Dura Automotive Systems, Inc., a Delaware corporation (the "Company")
proposes to issue and sell an aggregate of 2,700,000 shares of Class A Common
Stock, $.01 par value, of the Company (the "Firm Shares"), to the several
underwriters named in Schedule I hereto (the "Underwriters"). The Company also
proposes to issue and sell to the several Underwriters not more than 405,000
additional shares of Class A Common Stock, $.01 par value, of the Company (the
"Additional Shares"), if requested by the Underwriters as provided in Section 2
hereof. The Firm Shares and the Additional Shares are herein collectively
called the
<PAGE>

"Shares." The shares of common stock of the Company to be outstanding after
giving effect to the sales contemplated hereby are hereinafter referred to
as the "Common Stock."

1. Registration Statement and Prospectus. The Company has prepared
and filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively called the
"Act"), a registration statement on Form S-1 including a prospectus relating to
the Shares, which may be amended. The registration statement as amended at the
time when it becomes effective, including a registration statement (if any)
filed pursuant to Rule 462(b) under the Act increasing the size of the offering
registered under the Act and information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Act, is hereinafter referred to as the Registration Statement; and the
prospectus in the form first used to confirm sales of Shares is hereinafter
referred as the Prospectus.

2. Agreements to Sell and Purchase. On the basis of the
representations and warranties contained in this Agreement, and subject to its
terms and conditions, the Company agrees to issue and sell and each Underwriter
agrees, severally and not jointly, to purchase from the Company at a price per
share of $______ (the "Purchase Price") the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto.

On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to issue
and sell the Additional Shares and the Underwriters shall have the right to
purchase, severally and not jointly, up to 405,000 Additional Shares from the
Company at the Purchase Price. Additional Shares may be purchased solely for
the purpose of covering over-allotments made in connection with the offering of
the Firm Shares. The Underwriters may exercise their right to purchase
Additional Shares in whole or in part at any time (but not more than once) by
giving written notice thereof to the Company within 30 days after the date of
this Agreement. You shall give any such notice on behalf of the Underwriters
and such notice shall specify the aggregate number of Additional Shares to be
purchased pursuant to such exercise and the date for payment and delivery
thereof. The date specified in any such notice shall be a business day (i) no
earlier than the Closing Date (as hereinafter defined), (ii) no later than ten
business days after such notice has been given and (iii) no earlier than two
business days after such notice has been given. If any Additional Shares are
to be purchased, each Underwriter, severally and not jointly, agrees to purchase
from the Company the number of such Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) which bears
the same proportion to the total number of Additional Shares to be purchased
from the Company as the number of Firm Shares set forth opposite the name of
such Underwriter in Schedule I bears to the total number of Firm Shares.

The Company agrees and the Company shall, concurrently with the
execution of this Agreement, deliver an agreement executed by (i) each of
the directors and officers of the Company, and (ii) each stockholder listed on
Annex I hereto, pursuant to which each such person agrees, not to offer, sell,
contract to sell, grant any option to purchase, or otherwise dispose of any
common stock of the Company or any securities convertible into or exercisable
or

-2-
<PAGE>

exchangeable for such common stock, except to the Underwriters pursuant to this
Agreement, for a period of 180 days after the date of the Prospectus without the
prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation.
Notwithstanding the foregoing, during such period (i) the Company may grant
stock options pursuant to the Company's 1996 Key Employee Stock Option Plan and
Independent Director Stock Option Plan and (ii) the Company may issue shares of
its common stock upon the exercise of an option or warrant or the conversion of
a security outstanding on the date hereof and in connection with its Employee
Stock Discount Purchase Plan.

3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose (i) to make a public offering of their respective portions
of the Shares as soon after the effective date of the Registration Statement as
in your judgment is advisable and (ii) initially to offer the Shares upon the
terms set forth in the Prospectus.

4. Delivery and Payment. Delivery to the Underwriters of and payment
for the Firm Shares shall be made at 10:00 A.M., New York City time, on the
third or fourth business day unless otherwise permitted by the Commission
pursuant to Rule 15c6-1 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")(the "Closing Date") following the date of the initial public
offering, at such place outside the State of New York as you shall designate.
The Closing Date and the location of delivery of and the form of payment for
the Firm Shares may be varied by agreement between you and the Company.

Delivery to the Underwriters of and payment for any Additional Shares
to be purchased by the Underwriters shall be made at such place as you shall
designate at 10:00 A.M., New York City time, on the date specified in the
applicable exercise notice given by you pursuant to Section 2 (the "Option
Closing Date"). The Option Closing Date and the location of delivery of and
the form of payment for such Additional Shares may be varied by agreement
between you and the Company.

Certificates for the Shares shall be registered in such names and
issued in such denominations as you shall request in writing not later than two
full business days prior to the Closing Date or the Option Closing Date, as the
case may be. Such certificates shall be made available to you for inspection
not later than 9:30 A.M., New York City time, on the business day next preceding
the Closing Date or the Option Closing Date, as the case may be. Certificates
in definitive form evidencing the Shares shall be delivered to you on the
Closing Date or the Option Closing Date, as the case may be, against payment of
the Purchase Price therefor by wire transfer or certified or official bank
checks payable in immediately available Federal funds to the order of the
Company.

5. Agreements of the Company. The Company agrees with you:

(a) To use its best efforts to cause the Registration Statement to
become effective at the earliest possible time.

-3-
<PAGE>

(b) To advise you promptly after obtaining knowledge thereof and,
if requested by you, to confirm such advice in writing, (i) when the
Registration Statement has become effective and when any post-effective
amendment to it becomes effective, (ii) of any request by the Commission
for amendments to the Registration Statement or amendments or supplements
to the Prospectus or for additional information, (iii) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares
for offering or sale in any jurisdiction, or the initiation of any
proceeding for such purposes, and (iv) of the happening of any event during
the period referred to in paragraph (e) below which makes any statement of
a material fact made in the Registration Statement or the Prospectus untrue
or which requires the making of any additions to or changes in the
Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop
order suspending the effectiveness of the Registration Statement, the
Company will make every reasonable effort to obtain the withdrawal or
lifting of such order at the earliest possible time.

(c) To furnish to you, without charge, four copies of the
Registration Statement (certified by the Secretary of the Company) as
first filed with the Commission and of each amendment to it, including
all exhibits, and to furnish to you and each Underwriter designated by
you such number of conformed copies of the Registration Statement as so
filed and of each amendment to it, without exhibits, as you may reasonably
request.

(d) Not to file any amendment or supplement to the Registration
Statement, whether before or after the time when it becomes effective, or
to make any amendment or supplement to the Prospectus, of which you shall
not previously have been advised or to which you shall reasonably object;
and, at any time prior to the termination of the offering of the Shares,
to prepare and file with the Commission, promptly upon your reasonable
request, any amendment to the Registration Statement or supplement to the
Prospectus which may be necessary or advisable in connection with the
distribution of the Shares by you, and to use its best efforts to cause
the same to become promptly effective.

(e) Promptly after the Registration Statement becomes effective, and
from time to time thereafter at any time prior to the termination of the
offering of the Shares if in the opinion of counsel for the Underwriters a
prospectus is required by law to be delivered in connection with sales by
an Underwriter or a dealer, to furnish to each Underwriter and dealer as
many copies of the Prospectus (and of any amendment or supplement to the
Prospectus) as such Underwriter or dealer may reasonably request.

(f) If during the period specified in paragraph (e) any event shall
occur as a result of which, in the opinion of counsel for the Underwriters
it becomes necessary to amend or supplement the Prospectus in order to make
the statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Prospectus to comply with any law,
forthwith to prepare and file with the Commission an appropriate amendment
or supplement to the Prospectus so that the statements in the Prospectus,
as so amended or supplemented, will

-4-
<PAGE>

not in the light of the circumstances when it is so delivered, be
misleading, or so that the Prospectus will comply with law, and to furnish
to each Underwriter and to such dealers as you shall specify, such number
of copies thereof as such Underwriter or dealers may reasonably request.

(g) Prior to any public offering of the Shares, to cooperate with you
and counsel for the Underwriters in connection with the registration or
qualification of the Shares for offer and sale by the several Underwriters
and by dealers under the state securities or Blue Sky laws of such
jurisdictions as you may reasonably request, to continue such qualification
in effect so long as required for distribution of the Shares and to file
such other documents as may be necessary in order to effect such
registration or qualification; provided, however, that neither the Company
nor any of its subsidiaries shall be obligated to file any general consent
to service of process or to qualify as a foreign corporation or as a dealer
in securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any jurisdiction
in which it is not otherwise so subject.

(h) To mail and make generally available to its stockholders as soon
as reasonably practicable an earnings statement covering a period of at
least twelve months after the effective date of the Registration Statement
(but in no event commencing later than 90 days after such date) which shall
satisfy the provisions of Section 11(a) of the Act, and to advise you in
writing when such statement has been so made available.

(i) During the period of three years after the date of this
Agreement, to make generally available as soon as reasonably practicable
after the end of each fiscal year to the record holders of its Common Stock
a financial report of the Company and its subsidiaries on a consolidated
basis (and a similar financial report of all unconsolidated subsidiaries,
if any), all such financial reports to include a consolidated balance
sheet, a consolidated statement of operations, a consolidated statement of
cash flows and a consolidated statement of shareholders' equity as of the
end of and for such fiscal year, together with comparable information as
of the end of and for the preceding year, certified by independent
certified public accountants.

(j) During the period referred to in paragraph (i), to furnish to
you as soon as available a copy of each report or other publicly available
information of the Company mailed to the holders of Common Stock or filed
with the Commission and such other publicly available information
concerning the Company and its subsidiaries as you may reasonably request.

(k) To pay all costs, expenses, fees and taxes incident to (i) the
preparation, printing, filing and distribution under the Act of the
Registration Statement (including financial statements and exhibits), each
preliminary prospectus and all amendments and supplements to any of them
prior to or during the period specified in paragraph (e), (ii) the printing
and delivery of the Prospectus and all amendments or supplements to it
during the period specified in paragraph (e), (iii) the delivery of this
Agreement, the

-5-
<PAGE>

Preliminary and Supplemental Blue Sky Memoranda and all other agreements,
memoranda, correspondence and other documents delivered in connection with
the offering of the Shares (including in each case any reasonable
disbursements of counsel for the Underwriters relating to such delivery),
(iv) the registration or qualification of the Shares for offer and sale
under the securities or Blue Sky laws of the several states (including in
each case the reasonable fees and disbursements of counsel for the
Underwriters relating to such registration or qualification and memoranda
relating thereto), (v) filing fees relating to the clearance with the
National Association of Securities Dealers, Inc. ("NASD") in connection
with the offering, (vi) the listing of the Shares on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ")
National Market System, (vii) furnishing such copies of the Registration
Statement, the Prospectus and all amendments and supplements thereto as may
be requested for use in connection with the offering or sale of the Shares
by the Underwriters or by dealers to whom Shares may be sold and (viii) the
performance by the Company of its other obligations under this Agreement.

(l) As long as the Common Stock is registered under Section 12(g) of
the Exchange Act, to use its best efforts to maintain the inclusion of the
Common Stock in the NASDAQ National Market System (or on a national
securities exchange) for a period of three years after the effective date
of the Registration Statement.

(m) To use its best efforts to do and perform all things reasonably
required or reasonably necessary to be done and performed under this
Agreement by the Company prior to the Closing Date or any Option Closing
Date, as the case may be, and to satisfy all conditions precedent to the
delivery of the Shares.

6. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter that:

(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before or, to the Company's
knowledge, threatened by the Commission.

(b) (i) Each part of the Registration Statement, when such part
became effective, did not contain and each such part, as amended or
supplemented, if applicable, will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii)
the Registration Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the
Act and (iii) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties
set forth in this paragraph (b) do not apply to statements or omissions in
the Registration Statement or the Prospectus

-6-
<PAGE>

based upon information relating to any Underwriter furnished to the Company
in writing by such Underwriter through you expressly for use therein.

(c) The Company and each of its subsidiaries has been duly
incorporated, is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation and has the corporate power
and authority to carry on its business as it is currently being conducted
and to own, lease and operate its properties, and each is duly qualified
and is in good standing as a foreign corporation authorized to do business
in each jurisdiction in which the nature of its business or its ownership
or leasing of property requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on
the Company and its subsidiaries, taken as a whole.

(d) All of the outstanding shares of capital stock of, or other
ownership interests in, each of the Company's subsidiaries have been duly
authorized and validly issued and are fully paid and non-assessable, and,
except as otherwise set forth in the Prospectus and except for any liens
pursuant to the New Credit Agreement (as defined in the Prospectus), are
owned by the Company, free and clear of any security interest, claim, lien,
encumbrance or adverse interest of any nature.

(e) All the outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid, non-assessable
and, as of the Closing Date, will not be subject to any preemptive or
similar rights; and the Shares have been duly authorized and, when issued
and delivered to the Underwriters against payment therefor as provided by
this Agreement, will be validly issued, fully paid and non-assessable, and
the issuance of such Shares will not be subject to any preemptive or
similar rights.

(f) The authorized capital stock of the Company, including the Common
Stock, conforms as to legal matters to the description thereof contained in
the Prospectus.

(g) Neither the Company nor any of its subsidiaries is in violation
of its respective charter or by-laws or in default in the performance of
any obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any other agreement,
indenture or instrument material to the conduct of the business of the
Company and its subsidiaries, taken as a whole, to which the Company or
any of its subsidiaries is a party or by which it or any of its
subsidiaries or their respective property is bound, which default could
reasonably be expected to result in a material adverse effect on the
business, prospects, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole.

(h) The execution, delivery and performance of this Agreement,
compliance by the Company with all the provisions hereof and the
consummation of the transactions contemplated hereby will not require any
consent, approval, authorization or other order of any court, regulatory
body, administrative agency or other governmental body (except as such may
be required under the Act, the Exchange Act, or the securities or Blue Sky

-7-
<PAGE>

laws of the various states or the by-laws or rules of the NASD) and will
not conflict with or constitute a breach of any of the terms or provisions
of, or a default under, the charter or by-laws of the Company or any of its
subsidiaries or any agreement, indenture or other instrument to which it or
any of its subsidiaries is a party or by which it or any of its
subsidiaries or their respective property is bound, or violate or conflict
with any laws, administrative regulations or rulings or court decrees
applicable to the Company, any of its subsidiaries or their respective
property, other than conflicts or breaches that, individually or in the
aggregate, would not reasonably be expected to result in a material adverse
effect on the business, prospects, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, or
materially impair the ability of the Company to perform its obligations
under this Agreement.

(i) Except as otherwise set forth in the Prospectus, there are no
material legal or governmental proceedings pending to which the Company or
any of its subsidiaries is a party or of which any of their respective
property is the subject, and, to the best of the Company's knowledge, no
such proceedings are threatened or contemplated. No contract or document of
a character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement is
not so described or filed as required.

(j) Except as otherwise set forth in the Prospectus, neither the
Company nor any of its subsidiaries has violated any foreign, federal,
state or local law or regulation relating to the protection of human health
and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("Environmental Laws"), nor any federal or state
law relating to discrimination in the hiring, promotion or pay of employees
nor any applicable federal or state wages and hours laws, nor any
provisions of the Employee Retirement Income Security Act or the rules and
regulations promulgated thereunder, which in any such case might result in
any material adverse change in the business, prospects, financial condition
or results of operations of the Company and its subsidiaries, taken as a
whole.

(k) The Company and each of its subsidiaries has such permits,
licenses, franchises and authorizations of governmental or regulatory
authorities ("permits"), including, without limitation, under any
applicable Environmental Laws, as are necessary to own, lease and operate
its respective properties and to conduct its business, except for such
permits, licenses, franchises and authorizations the absence of which,
individually or in the aggregate, would not have a material adverse effect
on the business, prospects, financial condition or results of operations of
the Company and its subsidiaries, taken as a whole; and the Company and
each of its subsidiaries has fulfilled and performed all of its material
obligations with respect to such permits and no event has occurred which
allows, or after notice or lapse of time would allow, revocation or
termination thereof or results in any other material impairment of the
rights of the holder of any such permit.

(l) Except as otherwise set forth in the Prospectus or such as are
not material to the business, prospects, financial condition or results of
operation of the Company and its

-8-
<PAGE>

subsidiaries, taken as a whole, the Company and each of its subsidiaries
has good and marketable title, free and clear of all liens, claims,
encumbrances and restrictions except liens for taxes not yet due and
payable and liens that do not materially detract from the value thereof or
materially impair its use in the business of the Company or such
subsidiary, to all property and assets described in the Registration
Statement as being owned by it. No default has occurred or is continuing
under any material lease to which the Company or any of its subsidiaries is
a party which might result in any material adverse change in the business,
prospects, financial condition or results of operation of the Company and
its subsidiaries, taken as a whole.

(m) The Company and each of its subsidiaries maintain reasonably
adequate insurance.

(n) To the Company's knowledge Arthur Andersen LLP are independent
public accountants with respect to the Company as required by the Act.

(o) The financial statements, together with related schedules and
notes forming part of the Registration Statement and the Prospectus (and
any amendment or supplement thereto), present fairly the consolidated
financial position, results of operations and changes in financial position
of the Company and its subsidiaries on the basis stated in the Registration
Statement at the respective dates or for the respective periods to which
they apply; such statements and related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other financial and statistical information and data set
forth in the Registration Statement and the Prospectus (and any amendment
or supplement thereto) are, in all material respects, accurately presented
and prepared on a basis consistent with such financial statements and the
books and records of the Company.

(p) The Company is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.

(q) Except as otherwise set forth in the Prospectus, no holder of any
security of the Company has any right to require registration of shares of
Common Stock or any other security of the Company.

(r) The Company has complied with all provisions of Section 517.075,
Florida Statutes (Chapter 92-198, Laws of Florida).

(s) The Company has filed a registration statement pursuant to
Section 12(g) of the Exchange Act, to register the Common Stock, has filed
an application to list the Shares on the Nasdaq National Market, and has
received notification that the listing has been approved, subject to notice
of issuance.

-9-
<PAGE>

7. Indemnification. (a) Each of the Company and Dura Operating Corp.
("Dura"; for purposes of this Section 8, the term "Company" shall include Dura)
agrees to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), from and against any and all losses, claims, damages, liabilities and
judgments caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
such losses, claims, damages, liabilities or judgments are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriters furnished in writing to the Company by
or on behalf of any Underwriter through you expressly for use therein; provided,
however, that the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages and liabilities and judgments
purchased Shares, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Shares to such
person, and if the Prospectus (as so amended and supplemented) would have cured
the defect giving rise to such loss, claim, damage, liability or judgment.

(b) In case any action shall be brought against any Underwriter or any
person controlling such Underwriter, based upon any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement thereto
and with respect to which indemnity may be sought against the Company, such
Underwriter shall promptly notify the Company in writing and the Company shall
assume the defense thereof, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all reasonable fees and
expenses. Any Underwriter or any such controlling person shall have the right to
employ separate counsel in any such action and participate in the defense
thereof, but the reasonable fees and expenses of such counsel shall be at the
expense of such Underwriter or such controlling person unless (i) the employment
of such counsel shall have been specifically authorized in writing by the
Company, (ii) the Company shall have failed to assume the defense and employ
counsel or (iii) the named parties to any such action (including any impleaded
parties) include both such Underwriter or such controlling person and the
Company and such Underwriter or such controlling person shall have been advised
by such counsel that there may be one or more legal defenses available to it
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to assume the defense of such
action on behalf of such Underwriter or such controlling person, it being
understood, however, that the Company shall not, in connection with any one such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of

-10-
<PAGE>

attorneys (in addition to any local counsel) for all such Underwriters and
controlling persons, which firm shall be designated in writing by Donaldson,
Lufkin & Jenrette Securities Corporation and that all such reasonable fees and
expenses shall be reimbursed as they are incurred). The Company shall not be
liable for any settlement of any such action effected without its written
consent but if settled with the written consent of the Company, the Company
agrees to indemnify and hold harmless any Underwriter and any such controlling
person from and against any loss or liability by reason of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, which consent shall not be unreasonably withheld, effect any settlement
of any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity reasonably could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.

(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and any person controlling the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent
as the foregoing indemnity from the Company to each Underwriter but only with
reference to information relating to such Underwriter furnished in writing by or
on behalf of such Underwriter through you expressly for use in the Registration
Statement, the Prospectus or any preliminary prospectus. In case any action
shall be brought against the Company, any of its directors, any such officer or
any person controlling the Company based on the Registration Statement, the
Prospectus or any preliminary prospectus and in respect of which indemnity may
be sought against any Underwriter, the Underwriter shall have the rights and
duties given to the Company (except that if the Company shall have assumed the
defense thereof, such Underwriter shall not be required to do so, but may employ
separate counsel therein and participate in the defense thereof but the fees and
expenses of such counsel shall be at the expense of such Underwriter), and the
Company, its directors, any such officers and any person controlling the Company
shall have the rights and duties given to the Underwriter, by Section 7(b)
hereof.

(d) If the indemnification provided for in this Section 7 is
unavailable (other than as expressly provided above) to an indemnified party in
respect of any losses, claims, damages, liabilities or judgments referred to
therein, then each indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities and judgments (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Underwriters on the other hand from the
offering of the Shares or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Underwriters in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Underwriters shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company,
and the total underwriting discounts and commissions

-11-
<PAGE>

received by the Underwriters, bear to the total price to the public of the
Shares, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault of the Company and the Underwriters shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the Company or the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 7(d) are several in proportion to the respective number of Shares
purchased by each of the Underwriters hereunder and not joint.

8. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Firm Shares under this Agreement are subject to
the satisfaction of each of the following conditions:

(a) All the representations and warranties of the Company contained in
this Agreement shall be true and correct on the Closing Date with the same
force and effect as if made on and as of the Closing Date.

(b) The Registration Statement shall have become effective not later
than 5:00 P.M.(and in the case of a Registration Statement filed under Rule
462(b) of the Act, not later than 10:00 p.m.), New York City time, on the
date of this Agreement or at such later date and time as you may approve in
writing, and at the Closing Date no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for
that purpose shall have been commenced or shall be pending before or
contemplated by the Commission.

(c) (i) Since the date of the latest balance sheet included in the
Registration Statement and the Prospectus, there shall not have been any
material adverse change, or

-12-
<PAGE>

any development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, affairs or business
prospects, whether or not arising in the ordinary course of business, of
the Company, (ii) since the date of the latest balance sheet included in
the Registration Statement and the Prospectus there shall not have been any
change, or any development involving a prospective material adverse change,
in the capital stock or in the long-term debt of the Company from that set
forth in the Registration Statement and Prospectus, and (iii) on the
Closing Date you shall have received a certificate dated the Closing Date,
signed by each of the Chief Executive Officer and the Chief Financial
Officer of the Company, confirming the matters set forth in paragraphs (a),
(b), and (c) of this Section 9.

(d) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing
Date, of Kirkland & Ellis, counsel for the Company, to the effect that:

(i) the Company and Dura have been duly incorporated, are each
validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation and have the corporate power and
authority required to carry on their businesses as described in the
Prospectus;

(ii) the Company and Dura are duly qualified and in good standing
as foreign corporations authorized to do business in Michigan and
Missouri which such counsel have been informed by the Company are the
only states in which the Company and Dura are qualified to do business
as foreign corporations;

(iii) the Company is the sole record owner and, to such counsel's
knowledge, the sole beneficial owner of all of the outstanding shares
of capital stock of Dura;

(iv) all the outstanding shares of Common Stock have been duly
authorized and validly issued and are fully paid and non-assessable;
(v) the Shares to be issued and sold by the Company hereunder have
been duly authorized, and when issued and delivered to the
Underwriters against payment therefor as provided by this Agreement,
will have been validly issued and will be fully paid and non-
assessable, and, to such counsel's knowledge, the issuance of such
Shares is not subject to any preemptive or similar rights;

(vi) this Agreement has been duly authorized, executed and
delivered by each of the Company and Dura;

(vii) the authorized capital stock of the Company, including the
Common Stock, conforms in all material respects as to legal matters to
the description thereof contained in the Prospectus;

-13-
<PAGE>

(viii) the Commission has advised the Company that the
Registration Statement has become effective under the Act, and, the
knowledge of such counsel, no stop order suspending its effectiveness
has been issued and no proceedings for that purpose are pending before
or contemplated by the Commission;

(ix) the statements under the captions "Management -- 1996 Key
Employee Stock Option Plan", "Management -- Employee Stock Discount
Purchase Plan", "Management -- Independent Director Stock Option
Plan", "Management -- Stockholders Agreement", "Description of Capital
Stock", and "Shares Eligible for Future Sale -- Registration
Agreement" and in the Prospectus and Item 14 of Part II of the
Registration Statement insofar as such statements constitute a summary
of legal matters, documents or proceedings referred to therein, fairly
present the information called for with respect to such legal matters,
documents and proceedings;

(x) the execution, delivery and performance of this Agreement by
the Company and Dura, compliance by the Company and Dura with all the
provisions hereof and the issuance and sale of the Shares to be sold
by the Company to the Underwriters hereby will not require, to such
counsel's knowledge, any consent, approval, authorization or other
order of any court, regulatory body, administrative agency or other
governmental body (except as such may be required under the Act, the
Exchange Act or other securities or Blue Sky laws or the rules or by-
laws of the NASD) and will not conflict with or constitute a breach of
any of the terms or provisions of, or a default under, the charter or
by-laws of the Company or Dura or the Agreements listed on attached
Annex II, or violate or conflict with any laws, administrative
regulations or rulings or court decrees known to such counsel and
applicable to the Company or Dura or their respective properties
(other than federal securities laws);

(xii) after due inquiry, such counsel does not know of any legal
or governmental proceeding pending or threatened to which the Company
or Dura is a party or to which any of their respective property is
subject which is required to be described in the Registration
Statement or the Prospectus and is not so described, or of any
contract or other document which is required to be described in the
Registration Statement or the Prospectus or is required to be filed as
an exhibit to the Registration Statement which is not described or
filed as required;

(xiv) to such counsel's knowledge, except as set forth in the
Registration Agreement (as defined in the Prospectus), no holder of
any security of the Company has any right to require registration of
shares of Common Stock or any other security of the Company; and

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<PAGE>

(xv) the Registration Statement (including any Registration
Statement filed under 462(b) of the Act, if any) and the Prospectus
and any supplement or amendment thereto (except for financial
statements as to which no opinion need be expressed) appear on their
face to be appropriately responsive in all material respects to the
requirements of the Act.

Such counsel shall also advise that, based upon its participation in
conferences during which the Registration Statement, the Prospectus and
related matters were discussed, its review of certain corporate documents
of the Company, its understanding of applicable law and the experience it
has gained in its practice thereunder (relying to a large extent upon the
opinions and statements of officers of the Company with respect to facts
necessary to the determination of materiality), nothing has come to such
counsel's attention that causes it to believe that, as of its effective
date, the Registration Statement (other than the financial statements, the
notes thereto and the supporting schedules and other financial and
statistical data set forth therein or omitted therefrom, as to which no
such advice need be given) contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that, as of its
date or as of the date of delivery of such advice, the Prospectus (other
than the financial statements, the notes thereto and the supporting
schedules and other financial and statistical data set forth therein or
omitted therefrom, as to which no such advice need be given) included an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.

(e) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Gardner, Carton & Douglas, counsel for the Underwriters,
as to the matters referred to in clauses (v), (vi) (but only with respect
to the Company), (viii), (ix) (but only with respect to the statements
under the captions "Description of Capital Stock" and "Underwriting") and
(xv) of the foregoing paragraph (e).

-15-
<PAGE>

omitted to state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.

(f) You shall have received a letter on and as of the Closing Date, in
form and substance satisfactory to you, from Arthur Andersen LLP,
independent public accountants, with respect to the financial statements
and certain financial information contained in the Registration Statement
and the Prospectus and substantially in the form and substance of the
letter delivered to you by Arthur Andersen LLP on the date of this
Agreement.

(g) The Company shall have delivered to you the agreements specified
in Section 2 hereof.

(h) The Company shall not have failed at or prior to the Closing Date
to perform or comply with any of the agreements herein contained and
required to be performed or complied with by the Company at or prior to the
Closing Date.

The several obligations of the Underwriters to purchase any Additional Shares
hereunder are subject to the delivery to you on the Option Closing Date of such
documents as you may reasonably request with respect to the good standing of the
Company, the due authorization and issuance of such Additional Shares and other
matters related to the issuance of such Additional Shares.

9. Effective Date of Agreement and Termination. This Agreement shall
become effective upon the later of (i) execution of this Agreement and (ii) when
notification of the effectiveness of the Registration Statement has been
released by the Commission.

This Agreement may be terminated at any time prior to the Closing Date
by you by written notice to the Company if any of the following has occurred:
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change or
development involving a prospective material adverse change in the condition,
financial or otherwise, of the Company and subsidiaries, taken as a whole, or
the earnings, affairs, or business prospects of the Company and its
subsidiaries, taken as a whole, whether or not arising in the ordinary course of
business, which would, in your judgment, make it impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus, (ii) any
outbreak or escalation of hostilities or other national or international
calamity or crisis or change in economic conditions or in the financial markets
of the United States or elsewhere that, in your judgment, is material and
adverse and would, in your judgment, make it impracticable to market the Shares
on the terms and in the manner contemplated in the Prospectus, (iii) the
suspension or material limitation of trading in securities on the New York Stock
Exchange, the American Stock Exchange or the NASDAQ National Market System or
limitation on prices for securities on any such exchange or National Market
System, or (iv) the declaration of a banking moratorium by either federal or New
York State authorities.

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<PAGE>

If on the Closing Date or on the Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase the
Firm Shares or Additional Shares, as the case may be, which it or they have
agreed to purchase hereunder on such date and the aggregate number of Firm
Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters, as the case may be, agreed but failed or refused to
purchase is not more than one-tenth of the total number of Shares to be
purchased on such date by all Underwriters, each non-defaulting Underwriter
shall be obligated severally, in the proportion which the number of Firm Shares
set forth opposite its name in Schedule I bears to the total number of Firm
Shares which all the non-defaulting Underwriters, as the case may be, have
agreed to purchase, or in such other proportion as you may specify, to purchase
the Firm Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters, as the case may be, agreed but failed or refused to
purchase on such date; provided that in no event shall the number of Firm Shares
or Additional Shares, as the case may be, which any Underwriter has agreed to
purchase pursuant to Section 2 hereof be increased pursuant to this Section 10
by an amount in excess of one-ninth of such number of Firm Shares or Additional
Shares, as the case may be, without the written consent of such Underwriter. If
on the Closing Date or on the Option Closing Date, as the case may be, any
Underwriter or Underwriters shall fail or refuse to purchase Firm Shares, or
Additional Shares, as the case may be, and the aggregate number of Firm Shares
or Additional Shares, as the case may be, with respect to which such default
occurs is more than one-tenth of the aggregate number of Shares to be purchased
on such date by all Underwriters and arrangements satisfactory to you and the
Company for purchase of such Shares are not made within 48 hours after such
default, this Agreement will terminate without liability on the part of any non-
defaulting Underwriter and the Company. In any such case which does not result
in termination of this Agreement, either you or the Company shall have the right
to postpone the Closing Date or the Option Closing Date, as the case may be, but
in no event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and the Prospectus or any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
any such Underwriter under this Agreement.

10. Miscellaneous. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (a) if to the Company, to Dura
Automotive Systems, Inc., 4508 IDS Center, Minneapolis, Minnesota 55402, and (b)
if to any Underwriter or to you, to you c/o Donaldson, Lufkin & Jenrette
Securities Corporation, 140 Broadway, New York, New York 10005, Attention:
Syndicate Department, or in any case to such other address as the person to be
notified may have requested in writing.

The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company, its officers and directors and
of the several Underwriters set forth in or made pursuant to this Agreement
shall remain operative and in full force and effect, and will survive delivery
of and payment for the Shares, regardless of (i) any investigation, or statement
as to the results thereof, made by or on behalf of any Underwriter or by or on
behalf of the Company, the officers or directors of the Company or any
controlling person of the Company, (ii) acceptance of the Shares and payment for
them hereunder and (iii) termination of this Agreement.

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<PAGE>

If this Agreement shall be terminated by the Underwriters because of
any failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, other than any termination
pursuant to Section 9(ii), (iii) or (iv), the Company agrees to reimburse the
several Underwriters for all out-of-pocket expenses (including the reasonable
fees and disbursements of counsel) reasonably incurred by them.

Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the
Underwriters, any controlling persons referred to herein and their respective
successors and assigns, all as and to the extent provided in this Agreement, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include a purchaser of
any of the Shares from any of the several Underwriters merely because of such
purchase.

This Agreement shall be governed and construed in accordance with the
laws of the State of New York.

This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.

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<PAGE>

Please confirm that the foregoing correctly sets forth the agreement
between the Company, the Selling Stockholders and the several Underwriters.

Very truly yours,

DURA AUTOMOTIVE SYSTEMS, INC.

By:
--------------------------
Title:

DURA OPERATING CORP.

By:
--------------------------
Title:

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
ROBERT W. BAIRD & CO.
INCORPORATED
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto

By DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION

By
------------------------

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<PAGE>

SCHEDULE I
-----------

Number of Firm
Underwriters Shares to be Purchased
- ------------ ----------------------

Donaldson, Lufkin & Jenrette
Securities Corporation
Morgan Stanley & Co.
Incorporated
Robert W. Baird & Co.
Incorporated

----------------------

Total 2,700,000
======================

-20-
<PAGE>

ANNEX I
--------

Required Stockholder Lock-ups
-----------------------------

<S> <C> <C>
Onex DHC LLC Hanson Nordstrom
Alkin Co. Haxel Skrzyniarz
J2R Corporation Robert R. Hibbs Stepanian
S.A. Johnson Huber Stephens
Karl F. Storrie David P. Klosterman Tayon
Allison John J. Knappenberger Truckey
Bach Milton D. Kniss Neil Anderson
Bigham Kraus W.H. Clement
David R. Bovee Kukla Mary L. Johnson
Joe A. Bubenzer Carl Kuscera James L. O'Loughlin
Casleton Craig L. Lamiman Barry Orscheln
Doolittle Mack Eric J. Rosen
Elliot McGuire Scott D. Rued
Fritz Messinger Barbara A. Westhues

</TABLE>

-21-

<PAGE>

DRRA
[LOGO OF DURA AUTOMOTIVE SYSTEMS, INC.]

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

CUSIP 265903 10 4
SEE REVERSE SIDE FOR
CERTAIN DEFINITIONS

This Certifies that

is the registered holder of

FULLY PAID AND NON-ASSESSABLE SHARES OF THE CLASS A COMMON STOCK OF THE PAR
VALUE $.01 EACH OF

DURA AUTOMOTIVE SYSTEMS, INC.

transferable on the books of Dura Automotive Systems, Inc. by the holder hereof
in person or by duly authorized attorney upon surrender of this Certificate
properly endorsed. This Certificate and the shares represented are issued and
shall be subject to all of the provisions of the Articles of Incorporation and
the By-laws of Dura Automotive Systems, Inc., and all amendments thereto, copies
of which are on file with the Transfer Agent. This Certificate is not valid
until countersigned by the Transfer Agent and registered by the Registrar.

WITNESS the facsimile seal of the Dura Automotive Systems, Inc. and the
facsimile signatures of its duly authorized officers.

Dated:

/s/ David Bovee /s/ Karl F. Storrie
------------------- -------------------
David Bovee Karl F. Storrie
Assistant Secretary President

[SEAL OF DURA AUTOMOTIVE SYSTEMS, INC.]

COUNTERSIGNED: FIRSTAR TRUST COMPANY
(Milwaukee, Wisconsin)
BY TRANSFER AGENT and REGISTRAR

----------------------------------------------
AUTHORIZED SIGNATURE

<PAGE>

The Company will furnish without charge to each stockholder who so requests
a statement of the rights, privileges, restrictions, voting powers, limitations
and qualifications of the several classes of stock of the company. Requests may
be directed to the Assistant Secretary of Dura Automotive Systems, Inc., 2791
Research Drive, Rochester Hills, Michigan 48309.

The following abbreviations, when used in the inscription on the face of
this Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

UNIF GIFT MIN ACT _______ CUSTODIAN ________
(Cust) (Minor)
Under Uniform Gift to Minors

Act -
TEN COM - as tenants in common ---------------
(State)
TEN ENT - as tenants by the entireties

JT TEN - as joint tenants with right of survivorship
and not as tenants in common

UNIF TRANS MIN ACT ______ Custodian ________
(Cust) (Minor)
Under Uniform Transfers to Minors

Act -
---------------
(State)

Additional abbreviations also may be used though not in the above list.

For Value Received,__________hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE

- --------------------------------------

- -------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

- -------------------------------------------------------------------------------

_________________________________________________________________________Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint

____________________________________________________________________as Attorney,
to transfer the said shares on the books of the within named corporation with
full power of substitution in the premises.

Date
---------------- ----------------------------------------------
SIGNATURE

NOTICE THE SIGNATURE TO THIS ASSIGNMENT MUST CORRE-
SPOND WITH THE NAME AS WRITTEN UPON THE FACE
OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHAT-
EVER.

<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC.

1996 KEY EMPLOYEE STOCK OPTION PLAN
-----------------------------------

ARTICLE 1

IDENTIFICATION OF THE PLAN

1.1 Title. The plan described herein shall be known as the Dura
Automotive Systems, Inc. 1996 Key Employee Stock Option Plan (the "Plan").

1.2 Purpose. The purpose of this Plan is (i) to compensate certain
officers and employees of Dura Automotive Systems, Inc. (the "Company") and its
Subsidiaries for services rendered by such persons after the date of adoption of
this Plan to the Company or any Subsidiary; (ii) to provide certain officers and
employees of the Company and its Subsidiaries with significant additional
incentive to promote the financial success of the Company; and (iii) to provide
an incentive which may be used to induce able persons to enter into or remain in
the employment of the Company or any Subsidiary.

1.3 Effective Date. The Plan shall become effective upon its approval
by the Board of Directors of the Company (the "Effective Date").

1.4 Defined Terms. Certain capitalized terms used herein have the
meanings as set forth in Section 10.1 of the Plan.

ARTICLE 2

ADMINISTRATION OF THE PLAN

2.1 Committee's Powers. This Plan shall be administered by a
Compensation Committee (the "Committee") composed of persons appointed by the
Board of Directors of the Company in accordance with the provisions of Section
2.2. The Committee shall have full power and authority to prescribe, amend and
rescind rules and procedures governing administration of this Plan. The
Committee shall have full power and authority (i) to interpret the terms of this
Plan, the terms of the Options and the rules and procedures
<PAGE>

established by the Committee and (ii) to determine the meaning of or
requirements imposed by or rights of any person under this Plan, any Option or
any rule or procedure established by the Committee. Each action of the Committee
which is within the scope of the authority delegated to the Committee by this
Plan or by the Board shall be binding on all persons.

2.2 Committee Membership. The Committee shall be composed of two or
more members of the Board, each of whom is an "outside director" as defined in
Section 162(m) of the Code and a "disinterested person," as defined in
Securities and Exchange Commission Rule 16b-3, as amended ("Rule 16b-3"), or any
successor rules or government pronouncements. The Board shall have the power to
determine the number of members which the Committee shall have and to change the
number of membership positions on the Committee from time to time. The Board
shall appoint all members of the Committee. The Board may from time to time
appoint members to the Committee in substitution for, or in addition to, members
previously appointed and may fill vacancies, however caused, on the Committee.
Any member of the Committee may be removed from the Committee by the Board at
any time with or without cause. If at any time no special committee has been
constituted by the Board especially for the purposes of this Plan, then the
members of the Board who are both "outside directors" as defined in Section
162(m) of the Code and "disinterested persons" as defined in Rule 16b-3 shall
have all powers and rights delegated to the "Committee" under this Plan.
Notwithstanding anything to the contrary in this Section 2.2, the Committee
shall not grant an Option to a Section 16 Holder unless the Committee is
constituted so as to comply with Securities and Exchange Commission Rule 16b-3,
as amended, or any successor rules or government pronouncements.

2.3 Committee Procedures. The Committee shall hold its meetings at
such times and places as it may determine. The Committee may make such rules
and regulations for the conduct of its business as it shall deem advisable.
Unless the Board or the Committee expressly decides to the contrary, a majority
of the members of the Committee shall constitute a quorum and any action taken
by a majority of the Committee members in attendance at a meeting at which a
quorum of Committee members are present shall be deemed an act of the Committee.

2.4 Indemnification. No member of the Committee shall be liable,
in the absence of bad faith, for any act or omission with respect to his or
her service on the Committee under this

-2-
<PAGE>

Plan. Service on the Committee shall constitute service as a director of the
Company so that the members of the Committee shall be entitled to
indemnification and reimbursement as directors of the Company for any action
or any failure to act in connection with service on the Committee to the full
extent provided for at any time in the Company's Certificate of Incorporation
and By-Laws, or in any insurance policy or other agreement intended for the
benefit of the Company's directors.

ARTICLE 3

EMPLOYEES ELIGIBLE TO RECEIVE OPTIONS

A person shall be eligible to be granted an Option only if on the
proposed Granting Date for such Option such person is a full-time, salaried
employee of the Company or any Subsidiary, excluding non-management directors
of the Company. A person eligible to be granted an Option is herein called a
"Key Employee."

ARTICLE 4

GRANT OF OPTIONS

4.1 Power to Grant Options. The Committee shall have the right and
the power to grant at any time to any Key Employee an option entitling such
person to purchase Common Stock (the "Common Stock") from the Company in such
quantity, at such price, on such terms and subject to such conditions consistent
with the provisions of this Plan as may be established by the Committee on or
prior to the Granting Date for such option. Each option to purchase Common
Stock which shall be granted by the Committee pursuant to the provisions of this
Plan is herein called an "Option."

4.2 Granting Date. An Option shall be deemed to have been granted
under this Plan on the date (the "Granting Date") which the Committee designates
as the Granting Date at the time it approves such Option, provided that the
Committee may not designate a Granting Date with respect to any Option which is
earlier than the date on which the granting of such Option is approved by the
Committee.

4.3 Option Terms Which The Committee May Determine. The Committee
shall have the power to determine the Key Employee to

-3-
<PAGE>

whom Options are granted, the number of Shares subject to each Option, the
number of Options awarded to each Key Employee and the time at which each Option
is granted. Except as otherwise expressly provided in this Plan, the Committee
shall also have the power to determine, at the time of the grant of each Option,
all terms and conditions governing the rights and obligations of the holder with
respect to such Option, including but not limited to: (a) the purchase price per
Share or the method by which the purchase price per Share will be determined;
(b) the length of the period during which the Option may be exercised and any
limitations on the number of Shares purchasable with the Option at any given
time during such period; (c) the times at which the Option may be exercised;
(d) any conditions precedent to be satisfied before the Option may be exercised,
such as vesting period; (e) any restrictions on resale of any Shares purchased
upon exercise of the Option; and (f) whether the Option will constitute an
Incentive Stock Option.

4.4 Option Agreement. No person shall have any rights under any
Option unless and until the Company and the person to whom such Option is
granted have executed and delivered an agreement expressly granting the Option
to such person and containing provisions setting forth the terms of the Option
(an "Option Agreement").

4.5 Limitation on Shares Issuable to any Key Employee. The aggregate
number of Shares that a Key Employee may receive upon exercise of all Options
awarded to such Key Employee during any calendar year (including those already
exercised by the Key Employee) shall not exceed 100,000 shares, as adjusted
pursuant to Article 8 of this Plan.

ARTICLE 5

OPTION TERMS

5.1 Plan Provisions Control Option Terms. The terms of this Plan
shall govern all the Options. In the event any provision of any Option
Agreement conflicts with any term in this Plan as constituted on the Granting
Date of such Option, the term in this Plan as constituted on the Granting Date
of the Option shall control. Except as provided in Article 8, the terms of any
Option may not be changed after the Granting Date of such Option without the
express approval of the Company and the Option Holder.

-4-
<PAGE>

5.2 Price Limitation. Subject to Article 8, the price at which each
Share may be purchased upon the exercise of any Option may not be less than the
Per Share Market Value on the Granting Date for such Option.

5.3 Term Limitation. No Incentive Stock Option may be granted under
this Plan which is exercisable more than ten years after its Granting Date.
This Section 5.3 shall not be deemed to limit the term which the Committee may
specify for any Options granted under the Plan which are not intended to be
Incentive Stock Options.

5.4 Transfer Limitations. No Option granted pursuant to this Plan
shall be transferable other than by will or the laws of descent and distribution
or exercisable during the lifetime of the person to whom the Option is initially
granted by anyone other than the initial grantee. It shall be a condition
precedent to any transfer of any Option that the transferee executes and
delivers an agreement acknowledging such Option has been acquired for investment
and not for distribution and is and shall remain subject to this Plan and the
Option Agreement. The "Holder" of any Option shall mean (i) the initial grantee
of such Option or (ii) any permitted transferee.

5.5 $100,000 Per Year Limit on Incentive Stock Options. No Key
Employee may be granted Incentive Stock Options if the value of the Shares
subject to those options which first become exercisable in any given calendar
year (and the value of the Shares subject to any other Incentive Stock Options
issued to the Key Employee under the Plan or any other plan of the Company or
its Subsidiaries which first become exercisable in such year) exceeds $100,000.
For this purpose, the value of Shares shall be determined on the Granting Date.
Any Incentive Stock Options issued in excess of the $100,000 limit shall be
treated as Options that are not Incentive Stock Options. Incentive Stock
Options shall be taken into account in the order in which they were granted.

5.6 No Right to Employment Conferred. Nothing in this Plan or (in
the absence of an express provision to the contrary) in any Option Agreement
(i) confers any right or obligation on any person to continue in the employ of
the Company or any Subsidiary or (ii) affects or shall affect in any way any
person's right or the right of the Company or any Subsidiary to terminate such

-5-
<PAGE>

person's employment with the Company or any Subsidiary at any time, for any
reason, with or without cause.

ARTICLE 6

OPTION EXERCISE

6.1 Normal Option Term. Except as otherwise expressly provided in
Sections 6.3, 6.5 or 6.7 or in the Option Agreement, the right to exercise any
Option shall terminate at the earlier of the following dates: (i) the
Termination Date of the initial grantee of the Option or (ii) the Expiration
Date of the Option.

6.2 Exercise Time. No Option granted to a Section 16 Holder shall
become exercisable within six months of the applicable Granting Date, except in
the case of the death or permanent disability of the Holder as provided in
Section 6.5 below. Notwithstanding the terms of the Option Agreement, if any
Option is issued to a Holder who is not a Section 16 Holder on the Granting Date
and such Holder becomes a Section 16 Holder before such Holder exercises such
Option, then such Option shall not become exercisable within six months of the
applicable Granting Date, except in the case of the death or permanent
disability of the Holder as provided in Section 6.5 below. Subject to the
preceding two sentences, each Option shall become exercisable at the time
provided in the Option Agreement, provided that the Committee in its sole
discretion shall have the right (but shall not in any case be obligated)
to permit the exercise of such Option prior to such time.

6.3 Extension of Exercise Time. The Committee in its sole discretion
shall have the right (but shall not in any case be obligated) to permit any
Option to be exercised after the Termination Date of the Holder of such Option.
Notwithstanding the preceding sentence, but subject to Section 6.7, the
Committee shall not have the right to permit the exercise of any Option after
its Expiration Date.

6.4 Exercise Procedures. Each Option shall be exercised by written
notice to the Company. Any Holder of any Option shall be required, as a
condition to such Holder's right to purchase securities with such Option, to
supply the Committee at such person's expense with such evidence,
representations, agreements or assurances (including, but not limited to,
opinions of counsel

-6-
<PAGE>

satisfactory to the Committee) as the Committee may deem necessary or desirable
in order to establish to the satisfaction of the Committee the right of such
person to exercise such Option and of the propriety of the sale of securities by
reason of such exercise under the Securities Act and any other laws or
requirements of any governmental authority specified by the Committee. The
Company shall not be obligated to sell any Shares subject to such Option until
all evidence, representations, agreements and assurances required by the
Committee have been supplied. An Option Holder shall not have any rights as a
stockholder with respect to Shares issuable under any Option until and unless
such Shares are sold and delivered to such Option Holder. The purchase price of
Shares purchased upon the exercise of an Option shall be paid in full in cash or
by check by the Option Holder at the time of the delivery of such Shares,
provided that the Committee may (but need not) permit payment to be made by (i)
delivery to the Company of outstanding Shares, (ii) retention by the Company of
Shares which would otherwise be transferred to the Option Holder upon exercise
of the Option or (iii) any combination of cash, check, the Holder's delivery of
outstanding Shares and retention by the Company of Shares which would otherwise
be transferred to the Option Holder upon exercise of the Option, and provided
further that no portion of the purchase price of Shares purchased on the
exercise of an Incentive Stock Option may be paid by retention of Shares by the
Company. In the event an Incentive Stock Option is granted, the Committee may
(but need not) permit payment to be made by (i) cash or check or (ii) delivery
to the Company of outstanding Shares. In the event any Common Stock is delivered
to or retained by the Company to satisfy all or any part of the purchase price,
the part of the purchase price deemed to have been satisfied by such Common
Stock shall be equal to the product derived by multiplying (i) the Per Share
Market Value as of the date of exercise by (ii) the number of Shares delivered
to or retained by the Company. The number of Shares delivered to or retained by
the Company in satisfaction of the purchase price shall not be a number which
when multiplied by the Per Share Market Value as of the date of exercise would
result in a product greater than the purchase price. No fractional Shares shall
be delivered to or retained by the Company in satisfaction of the purchase
price. To the extent such fractional share would result, the Option Holder shall
make up such difference in cash. With respect to any exercise of an Option that
is permitted to be made by delivery to the Company of outstanding Shares of
Common Stock or retention by the Company of Shares which would otherwise be
transferable to the Option Holder, the Option Holder shall be required to
deposit with the Company an amount in

-7-
<PAGE>

cash sufficient to allow the Company to satisfy any tax or other withholding
requirements under applicable law. Any part of the purchase price paid in cash
or by check upon the exercise of any Option shall be added to the general funds
of the Company and may be used for any proper corporate purpose. Notwithstanding
Article 7, unless the Board shall otherwise determine, for each Share delivered
to or retained by the Company as payment of all or part of the purchase price
upon the exercise of any Option, the aggregate number of Shares subject to this
Plan shall be increased by one Share.

6.5 Death, Permanent Disability, Retirement or Termination Without
Cause of Option Holder; Change in Control.

(a) Death. Except as otherwise expressly provided in the Option
Agreement, if the Holder of an Option dies while such Option Holder is still
employed by the Company or any Subsidiary, then the right to exercise all
unexpired installments of such Option which have not yet vested or become
exercisable shall be accelerated to the date of death and shall become
exercisable as of the date of death. Except as otherwise provided in the
Option Agreement and subject to Section 6.7, if the Holder of an Option dies
and such Option is then exercisable at the date of death (for any reason
including acceleration of vesting pursuant to the preceding sentence), then the
Holder's estate or the person or persons to whom the Holder's rights under the
Option shall pass by reason of the Holder's death shall have the right to
exercise the Option for 90 days after the date of death, and the Option shall
expire at the end of such 90-day period.

(b) Permanent Disability. Except as otherwise provided in the Option
Agreement, if a Permanent Disability occurs while a Holder of an Option is still
employed by the Company or any Subsidiary, then the right to exercise all
unexpired installments of such Option which have not yet vested or become
exercisable shall be accelerated to the Permanent Disability Date and shall
become exercisable as of the Permanent Disability Date. Except as otherwise
provided in the Option Agreement and subject to Section 6.7, if a Permanent
Disability occurs with respect to the Holder of an Option and such Option is
exercisable at the Permanent Disability Date (for any reason including
acceleration pursuant to the preceding sentence), then such Holder shall have
the right to exercise such Option for 90 days after the Permanent Disability
Date, and the Option shall expire at the end of such 90-day period.

-8-
<PAGE>

(c) Retirement. Except as otherwise provided in the Option Agreement,
if the Holder of an Option elects to voluntarily retire from the Corporation or
any Subsidiary while such Holder is still employed by the Company or any
Subsidiary, then any installments of such Option which have not yet vested or
become exercisable shall remain outstanding for up to three years following the
date of such retirement. During such three-year period, the time period for the
vesting of an Option contained in an Option Agreement will be deemed to continue
to be satisfied during such retirement and counted toward determining whether
any time period has been satisfied for vesting of the Option. Except as
otherwise provided in the Option Agreement and subject to Section 6.7, if the
Holder of an Option retires and such Option is or becomes exercisable at the
time of or following such retirement, then such Holder shall have the right to
exercise such Option for three years after the date of retirement, and the
Option shall expire at the end of such three-year period. This Section 6.5(c)
shall only apply to a Holder who voluntarily retires from the Company or a
Subsidiary on or after the date on which such Holder has attained the age of 59
1/2. Notwithstanding anything in this Section 6.5(c) or an Option Agreement to
the contrary, if the Committee determines in the good faith exercise of its
judgment that any Holder who has retired engages in any conduct detrimental to
the Company, upon such determination by the Committee, such Option shall
immediately and without further action on the part of the Company, expire and
become unexerciseable. No notice of such determination need be given to any
Holder in such circumstance.

(d) Termination Without Cause. Except as otherwise provided in the
Option Agreement and subject to Section 7, if the Holder of an Option is
terminated without Cause and such Option is currently exercisable at the time of
such termination, then such Holder shall have the right to exercise such Option
for 30 days after the date of such termination, and the Option shall expire at
the end of such 30-day period.

(e) Change in Control. In the event of a Change in Control, except as
otherwise provided in the Option Agreement, any Option awarded under this Plan
to the extent not previously exercisable shall immediately become fully
exercisable. The Committee in its sole discretion may direct the Company to cash
out all outstanding Options on the basis of the Change in Control Price as of
the date a Change in Control occurs or such other date as the Committee may
determine prior to the Change in Control.

-9-
<PAGE>

6.6 Taxes. The Company or any Subsidiary shall be entitled, if the
Committee deems it necessary or desirable, to withhold from an Option Holder's
salary or other compensation (or to secure payment from the Option Holder in
lieu of withholding) all or any portion of any withholding or other tax due from
the Company or any Subsidiary with respect to any Shares deliverable under such
Holder's Option or the Committee may (but need not) permit payment of such
withholding by the Company's retention of Shares which would otherwise be
transferred to the Option Holder upon exercise of the Option. In the event any
Common Stock is retained by the Company to satisfy all or any part of the
withholding, the part of the withholding deemed to have been satisfied by such
Common Stock shall be equal to the product derived by multiplying the Per Share
Market Value as of the date of exercise by the number of Shares retained by the
Company. The number of Shares retained by the Company in satisfaction of
withholding shall not be a number which when multiplied by the Per Share Market
Value as of the date of exercise would result in a product greater than the
withholding amount. No fractional Shares shall be retained by the Company in
satisfaction of withholding. Notwithstanding Article 7, unless the Board shall
otherwise determine, for each Share retained by the Company in satisfaction of
all or any part of the withholding amount, the aggregate number of Shares
subject to this Plan shall be increased by one Share. The Company may defer
delivery under a Holder's Option until indemnified to its satisfaction with
respect to such withholding or other taxes.

6.7 Securities Law Compliance. Each Option shall be subject to the
condition that such Option may not be exercised if and to the extent the
Committee determines that the sale of securities upon exercise of the Option may
violate the Securities Act or any other law or requirement of any governmental
authority. The Company shall not be deemed by any reason of the granting of any
Option to have any obligation to register the Shares subject to such Option
under the Securities Act or to maintain in effect any registration of such
Shares which may be made at any time under the Securities Act. An Option shall
not be exercisable if the Committee or the Board determines there is non-public
information material to the decision of the Holder to exercise such Option which
the Company cannot for any reason communicate to such Holder. Notwithstanding
Sections 6.1, 6.3 and 6.5 and the terms of the Option Agreement, if (i) any
Holder makes a bona fide request to exercise any Option which complies with
Section 6.4, (ii) the Committee or the Board determines such Option cannot be
exercised
-10-
<PAGE>

for a period of time pursuant to this Section 6.7 and (iii) such Option expires
during such period, then the term of such Option shall be extended until the end
of such period; provided, however, that the term of an Incentive Stock Option
cannot be extended beyond ten years after its Granting Date.

ARTICLE 7

SHARES SUBJECT TO THE PLAN

Except as provided in Sections 6.4 and 6.6 and Article 8, an aggregate
of 600,000 Shares of Common Stock shall be subject to this Plan. Except as
provided in Sections 6.4 and 6.6 and Article 8, the Options shall be limited so
that the sum of the following shall not as of any given time exceed 600,000
Shares: (i) all Shares subject to Options outstanding under this Plan at the
given time and (ii) all Shares which shall have been sold by the Company by
reason of the exercise at or prior to the given time of any of the Options. The
Common Stock issued under the Plan may be either authorized and unissued shares,
shares reacquired and held in the treasury of the Company, or both, all as from
time to time determined by the Board. In the event any Option shall expire or be
terminated before it is fully exercised, then all Shares formerly subject to
such Option as to which such Option was not exercised shall be available for any
Option subsequently granted in accordance with the provisions of this Plan.

In the event of a change in the Shares as presently constituted, which
is limited to a change of all of its authorized shares with par value into the
same number of shares with a different par value or without par value, the
shares resulting from any such change shall be deemed to be the Shares within
the meaning of the Plan.

ARTICLE 8

ADJUSTMENTS TO REFLECT ORGANIC CHANGES

The Board shall appropriately and proportionately adjust the number
and kind of Shares subject to outstanding Options, the price for which Shares
may be purchased upon the exercise of outstanding Options, and the number and
kind of Shares available for Options subsequently granted under this Plan to
reflect any stock dividend, stock split, combination or exchange of shares,
merger, consolidation or other change in the capitalization of the Company which
the Board determines to be similar, in its substantive effect upon this Plan or
the Options, to any of the changes expressly indicated in this sentence. The
Board may (but shall not be required to) make any appropriate adjustment to the
number and kind of Shares subject to outstanding Options, the price

-11-
<PAGE>

for which Shares may be purchased upon the exercise of outstanding Options, and
the number and kind of Shares available for Options subsequently granted under
this Plan to reflect any spin-off, spin-out or other distribution of assets to
stockholders or any acquisition of the Company's stock or assets or other change
which the Board determines to be similar, in its substantive effect upon this
Plan or the Options, to any of the changes expressly indicated in this sentence.
The Committee shall have the power to determine the amount of the adjustment to
be made in each case described in the preceding two sentences, but no adjustment
approved by the Committee shall be effective until and unless it is approved by
the Board. In the event of any reorganization, reclassification, consolidation,
merger or sale of all or substantially all of the Company's assets which is
effected in such a way that holders of Common Stock are entitled to receive
(either directly or upon subsequent liquidation) stock, securities or assets
with respect to or in exchange for Common Stock, the Board may (but shall not be
required to) substitute the per share amount of such stock, securities or assets
for Shares upon any subsequent exercise of any Option. If any fractional Share
becomes subject to any Option as a result of any change made under this Article
8, then (i) such Option may not be exercised with respect to such fractional
Share until and unless such Option is exercised as to all other Shares subject
to such Option and (ii) if such Option is exercised with respect to such
fractional Share, the Company shall have the right to deliver to the Holder in
lieu of such fractional Share cash in an amount equal to the product derived by
multiplying the fraction representing the portion of a full Share represented by
such fractional Share times the Per Share Market Value on the exercise date of
the Option with respect to such fractional Share established as prescribed in
this Plan.

ARTICLE 9

AMENDMENT AND TERMINATION OF THE PLAN

9.1 Amendment. Except as provided in the following two sentences, the
Board shall have complete power and authority to amend this Plan at any time and
no approval by the Company's stockholders or by any other person, committee or
other entity of any kind shall be required to make any amendment approved by the
Board effective. The Board shall not, without the affirmative approval of the
Company's stockholders, amend the Plan in any manner which would cause any
outstanding Incentive Stock Options to

-12-
<PAGE>

no longer qualify as Incentive Stock Options. If any Section 16 Holder holds any
Option, the Board shall not, without the affirmative vote of the holders of a
majority of the securities of the Company present, or represented, and entitled
to vote at a meeting duly held in accordance with applicable law, make any
amendment to this Plan which materially (i) increases the benefits accruing to
participants under the Plan, (ii) increases the number of shares of Common Stock
which may be issued under the Plan or (iii) modifies the requirements as to
eligibility for participation in the Plan. No termination or amendment of this
Plan may, without the consent of the Holder of any Option prior to termination
or the adoption of such amendment, materially and adversely affect the rights of
such Holder under such Option.

9.2 Termination. The Board shall have the right and the power to
terminate this Plan at any time, provided that no Incentive Stock Options may be
granted after the tenth anniversary of the adoption of this Plan. No Option
shall be granted under this Plan after the termination of this Plan, but the
termination of this Plan shall not have any other effect. Any Option outstand-
ing at the time of the termination of this Plan may be exercised after
termination of this Plan at any time prior to the Expiration Date of such Option
to the same extent such Option would have been exercisable had this Plan not
terminated.

ARTICLE 10

DEFINITIONS AND OTHER PROVISIONS OF THE PLAN

10.1 Definitions. Each term defined in this Section 10.1 has the
meaning indicated in this Section 10.1 whenever such term is used in this Plan:

"Board of Directors" and "Board" both mean the Board of Directors of
the Company as constituted at the time the term is applied.

"Cause" means (i) the willful refusal to follow directions given by
the Board, (ii) commission of any act involving moral turpitude or any act which
brings or could bring the Company into disrepute or materially damages its
relations with its customers, suppliers, licensors or financing sources, (iii)
the violation of any statutory or common law duty of loyalty to the Company or
(iv) a good faith determination by a majority of the

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<PAGE>

Board that continued employment is not in the best interests of the Company.

"Change in Control" means the occurrence of any of the following:

(i) When any "person" as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934 (the "Exchange Act") and as used in Sections 13(d) and
14(d) thereof, including a "group" as defined in Section 13(d) of the Exchange
Act but excluding the Company and any Subsidiary and any employee benefit plan
sponsored or maintained by the Company or any Subsidiary (including any trustee
of such plan acting as trustee), directly or indirectly, becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act, as amended from time to
time), after the effective date of the Plan, of securities of the Company
representing 20 percent or more of the combined voting power of the Company's
then outstanding securities;

(ii) When, during any period of 24 consecutive months during the
existence of the Plan, the individuals who, at the beginning of such period,
constitute the Board (the "Incumbent Directors") cease for any reason other than
death to constitute at least a majority thereof, provided, however, that a
director who was not a director at the beginning of such 24-month period shall
be deemed to have satisfied such 24-month requirement (and be an Incumbent
Director) if such director was elected by, or on the recommendation of or with
the approval of, at least two-thirds of the directors who then qualified as
Incumbent Directors either actually (because they were directors at the
beginning of such 24 month period) or by prior operation of this provision; or

(iii) The approval by the stockholders of the Company of a transaction
involving the acquisition of the Company by an entity other than the Company or
a subsidiary through purchase of assets, by merger, or otherwise.

"Change in Control Price" means the highest price per Share paid in
any transaction reported on the Nasdaq National Market or paid or offered in any
bona fide transaction related to a Change in Control at any time during the 60-
day period immediately preceding the occurrence of the Change in Control, in
each case as determined by the Committee.

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<PAGE>

"Common Stock" means the issued or issuable Class A Common Stock, par
value $.01 per share, of the Company.

"Code" means the Internal Revenue Code of 1986, as amended.

"Committee" has the meaning such term is given in Section 2.1 of this
Plan.

"Company" as applied as of any given time shall mean Dura Automotive
Systems, Inc., a Delaware corporation, except that if prior to the given time
any corporation or other entity has acquired all or a substantial part of the
assets of the Company (as herein defined) and has agreed to assume the
obligations of the Company under this Plan, or is the survivor in a merger or
consolidation to which the Company was a party, such corporation or other entity
shall be deemed to be the Company at the given time.

"Expiration Date" as applied to any Option means the date specified in
the Option Agreement between the Company and the Holder as the expiration date
of such Option. If no expiration date is specified in the Option Agreement
relating to any Option, then the Expiration Date of such Option shall be the day
prior to the tenth anniversary of the Granting Date of such Option.
Notwithstanding the preceding sentences, if the person to whom any Incentive
Stock Option is granted owns, on the Granting Date of such Option, stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Company (or of any parent or Subsidiary of the Company
in existence on the Granting Date of such Option), and if no expiration date is
specified in the Option Agreement relating to such Option, then the Expiration
Date of such Option shall be the day prior to the fifth anniversary of the
Granting Date of such Option.

"Granting Date" has the meaning such term is given in Section 4.2 of
this Plan.

"Holder" has the meaning such term is given in Section 5.4 of this
Plan.

"Incentive Stock Option" means an incentive stock option, as defined
in Code Section 422, which is granted pursuant to this Plan.

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<PAGE>

"Key Employee" has the meaning such term is given in Article 3 of this
Plan.

"Option" has the meaning such term is given in Section 4.1 of this
Plan.

"Option Agreement" has the meaning such term is given in Section 4.4
of this Plan.

"Permanent Disability" shall mean a determination by the Social
Security Administration or any similar successor agency that an initial grantee
is "permanently disabled."

"Permanent Disability Date" shall mean the date on which a
determination is made by the Social Security Administration or any similar
successor agency that an initial grantee is "permanently disabled."

"Per Share Market Value" on any given date shall be the fair market
value of one Share as of the close of business on the given date determined in
such manner as shall be prescribed in good faith by the Committee; provided,
that as long as the Shares are traded on a national securities exchange or
national automated quotation system (such as the Nasdaq National Market), the
Per Share Market Value shall be the reported closing price of the Shares on such
date.

"Plan" has the meaning such term is given in Section 1.1 of this Plan.

"Section 16 Holder" refers to any person who, with respect to the
Company, is subject to Section 16 of the Securities Exchange Act of 1934, as
amended, at any time or any law or statute which succeeds Section 16.

"Securities Act" at any given time shall consist of: (i) the
Securities Act of 1933 as constituted at the given time; (ii) any other law or
laws promulgated prior to the given time by the United States Government which
are in effect at the given time and which regulate or govern any matters at any
time regulated or governed by the Securities Act of 1933; (iii) all regulations,
rules, registration forms and other governmental pronouncements issued under the
laws specified in clauses (i) and (ii) of this sentence which are in effect at
the given time; and (iv) all inter-

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<PAGE>

pretations by any governmental agency or authority of the things specified in
clause (i), (ii) or (iii) of this sentence which are in effect at the given
time. Whenever any provision of this Plan requires that any action be taken in
compliance with any provision of the Securities Act, such provision shall be
deemed to require compliance with the Securities Act as constituted at the time
such action takes place.

"Share" means a share of Common Stock.

"Subsidiary" means any corporation in which the Company owns, directly
or indirectly, 50% or more of the total combined voting power of all classes of
securities of such corporation.

"Termination Date" as applied to the initial grantee of any Option
means, except as otherwise provided in the Option Agreement, the first date on
which such initial grantee is not employed by either the Company or any
Subsidiary for any reason (including, but not limited to, voluntary termination
or termination for Cause) other than as a result of the death, Permanent
Disability, retirement or termination without Cause of such Holder, in which
case the provisions set forth in Section 6 shall apply. The Committee may
specify in the original terms of an Option (or if not so specified, shall
determine) whether an authorized leave of absence or absence on military or
government service or absence for any other reason shall constitute a
termination of employment with the Company or any Subsidiary for the purposes of
this Plan.

10.2 Headings. Section headings used in this Plan are for conveni-
ence only, do not constitute a part of this Plan and shall not be deemed to
limit, characterize or affect in any way any provisions of this Plan. All
provisions in this Plan shall be construed as if no headings had been used in
this Plan.

10.3 Severability.

(a) General. Whenever possible, each provision in this Plan and in
every Option at any time granted under this Plan shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Plan or any Option at any time granted under this Plan is held to be
prohibited by or invalid under applicable law, then (i) such provision shall be
deemed amended to accomplish the objectives of the provision as originally
written to the fullest extent permitted by law and

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<PAGE>

(ii) all other provisions of this Plan and every Option at any time granted
under this Plan shall remain in full force and effect.

(b) Incentive Stock Options. Whenever possible, each provision in
this Plan and in every Option at any time granted under this Plan which is
evidenced by an Option Agreement which expressly states such Option is intended
to constitute an Incentive Stock Option under Code Section 422 (an "intended
ISO") shall be interpreted in such manner as to entitle such intended ISO to the
tax treatment afforded by the Code to Options which do constitute Incentive
Stock Options under Code Section 422, but if any provision of this Plan or any
intended ISO at any time granted under this Plan is held to be contrary to the
requirements necessary to entitle such intended ISO to the tax treatment
afforded by the Code to Options which do constitute Incentive Stock Options
under Code Section 422, then (i) such provision shall be deemed to have
contained from the outset such language as shall be necessary to entitle such
intended ISO to the tax treatment afforded by the Code to Options which do
constitute Incentive Stock Options under Code Section 422, and (ii) all other
provisions of this Plan and such intended ISO shall remain in full force and
effect. If any Option Agreement covering an intended ISO granted under this Plan
does not explicitly include any terms required to entitle such intended ISO to
the tax treatment afforded by the Code to Options which do constitute Incentive
Stock Options under Code Section 422, then all such terms shall be deemed
implicit in the intention to afford such treatment to such Option and such
Option shall be deemed to have been granted subject to all such terms.

10.4 No Strict Construction. No rule of strict construction shall
be applied against the Company, the Committee or any other person in the
interpretation of any of the terms of this Plan, any Option or any rule or
procedure established by the Committee.

10.5 Choice of Law. This Plan and all documents contemplated hereby,
and all remedies in connection therewith and all questions or transactions
relating thereto, shall be construed in accordance with and governed by the
internal laws of the State of Delaware.

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<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC.

INDEPENDENT DIRECTOR STOCK OPTION PLAN
--------------------------------------

1. Name and Purpose. This plan shall be called the Dura Automotive
Systems, Inc. Independent Director Stock Option Plan (the "Plan"). The Plan is
intended to encourage stock ownership by Independent Directors (as defined
below) of Dura Automotive Systems, Inc. (the "Company"), to provide such
directors with an additional incentive to manage the Company effectively and to
contribute to its success, and to provide a form of compensation which will
attract and retain highly qualified individuals as members of the Board of
Directors of the Company.

2. Effective Date and Term of the Plan. The Plan shall become effective
on the date of the consummation of the initial public offering of the Company's
Class A Common Stock, par value $.01 per share (the "Effective Date"). The
Plan, however, is subject to the approval by the stockholders of the Company.
If stockholder approval is not granted within twelve (12) months from the date
of its adoption by the Board of Directors, the Plan shall thereupon terminate.
Grants of options may be made prior to stockholder approval, but any options
granted shall not be exercisable prior to stockholder approval, and shall
terminate if stockholder approval is not given. Options may not be granted
under the Plan after the tenth (10th) anniversary of the Effective Date (the
"Term"); provided, however, that all options outstanding as of that date shall
remain or become exercisable pursuant to their terms and the terms of the Plan.

3. Administration. The Plan shall be administered by a committee of not
less than two (2) members of the Board of Directors of the Company (the
"Committee"), none of whom may be an Independent Director nor an employee of the
Company or any subsidiary of the Company. No member of the Committee shall be
eligible to participate in the Plan and no director may serve on the Committee
if he or she received an award or grant of any equity securities of the Company
(or any options to acquire such securities) under any plan of the Company during
the one (1) year period prior to service on the Committee.
<PAGE>

The Committee may, from time to time, establish such regulations,
provisions and procedures, within the terms of the Plan, as in the opinion of
its members may be advisable in the administration of the Plan. The Committee
shall keep minutes of its meetings. A majority of the Committee shall
constitute a quorum, and the acts of a majority of a quorum at any meeting,
or acts reduced to or approved in writing by a majority of the members of the
Committee, shall be the valid acts of the Committee.

The interpretation and construction by the Committee of any provisions
of the Plan or of any option granted pursuant to the Plan shall be final and
binding upon the Company, the Board of Directors of the Company and any
optionee. No member of the Board of Directors of the Company or the Committee
shall be liable for any action or determination made in good faith with respect
to the Plan or any option granted pursuant thereto.

4. Participation. Subject to the limitations contained in this Section
4, any director of the Company who (a) is not a contractual nor common law
employee of the Company or any of its subsidiaries, and (b) does not directly or
indirectly own beneficially more than five percent (5%) of any outstanding
security of the Company (including being a stockholder, owner, partner, director
or holder of more than ten percent (10%) of the equity or capital of any entity
which owns beneficially more than five percent (5%) of any outstanding security
of the Company) (an "Independent Director"), may be granted options to purchase
shares of the issued or issuable Class A Common Stock, par value $.01 per share,
of the Company (the "Common Stock"), in accordance and consistent with the terms
and conditions of the Plan. An optionee may hold more than one option, but only
on the terms and subject to the restrictions hereafter set forth. The Committee
shall from time to time determine the directors (among the Independent
Directors) to be granted options, the amount of Common Stock to be optioned to
each director, and the terms and conditions of the options to be granted. The
amount and other terms and conditions of options granted to a director at any
given time need not be the same for any other grant of options.

5. Stock Available for Options. Subject to the adjustments as provided
in Subsection 6(h), the aggregate number of shares of Common Stock reserved for
purposes of the Plan shall be 100,000 shares authorized and issued shares or
issued shares reacquired by

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<PAGE>

the Company (the "Shares"). Determinations as to the number of Shares that
remain available for issuance under the Plan shall be made in accordance with
such rules and procedures as the Committee shall determine from time to time,
which shall be consistent with the requirements of Rule 16b-3 of the Securities
Exchange Act of 1934, as amended, and such interpretations thereof. If any
outstanding option under the Plan expires or is terminated for any reason before
the end of the Term of the Plan, the shares allocable to the unexercised portion
of such option shall become available for the grant of other options under the
Plan. No shares delivered to the Company in full or partial payment upon
exercise of an option pursuant to Subsection 6(d) or in full or partial payment
of any withholding tax liability permitted under Section 9 shall become
available for the grant of other options under the Plan.

6. Terms and Conditions of Options of the Plan. Options granted under
this Plan shall be evidenced by agreements in such form as the Committee shall
from time to time approve, which agreements shall comply with and be subject to
the following conditions:

(a) Optionee's Agreement. Each optionee shall agree to continue to
serve as a director of the Company for the lesser of at least twelve (12)
months from the date of the grant of the option or for the remainder of
such optionee's term as a director of the Company. Such agreement shall not
impose upon the Company, its Board of Directors, or its stockholders any
obligation to retain the optionee as a director for any period.

(b) Number of Shares and Term of Options. Each option shall state the
number of shares of the Common Stock of the Company to which it pertains.
The term of each option shall be for a period of not greater than ten (10)
years from the date of grant of the option.

(c) Option Price. The exercise price of each option shall be equal to
one hundred percent (100%) of the Fair Market Value of the shares of Common
Stock on the date of the grant of the option. If the shares are traded in
the over-the-counter market, the Fair Market Value per share shall be the
closing price on the national market list as quoted in the National
Association of Securities Dealers Automated Quotation

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<PAGE>

System ("Nasdaq") on the day the option is granted or if no sale of shares
is reflected in Nasdaq on that day, on the next preceding day on which
there was a sale of shares reflected in Nasdaq. If the shares are not
traded in the over-the-counter market but are listed upon an established
stock exchange or exchanges, such Fair Market Value shall be deemed to be
the closing price of the shares on such stock exchange or exchanges on the
day the option is granted or if no sale of the shares shall have been made
on any stock exchange on that day, on the next preceding day on which there
was a sale of the shares.

(d) Medium of Payment. The option price shall be payable to the
Company either (i) in United States dollars in cash or by check, bank
draft, or money order payable to the order of the Company or (ii) if
permitted by the Committee, through the delivery of shares of the Common
Stock with a Fair Market Value on the date of the exercise equal to the
option price, provided such shares are utilized as payment to acquire at
least 100 shares of Common Stock, or (iii) by a combination of (i) and (ii)
above. Fair Market Value will be determined in the manner specified in
Subsection 6(c) except as to the date of determination.

(e) Exercise of Options. Except as provided in Subsection 6(h), no
option shall be exercisable, either in whole or in part, prior to the
expiration of six (6) months from the date of grant of the option. Subject
to the foregoing, the Committee shall have the authority to determine, at
the time of the grant of each Option, the times at which an Option may be
exercised and any conditions precedent to the exercise of an Option. An
option shall be exercisable upon written notice to the Chief Financial
Officer of the Company, as to any or all shares covered by the option,
until its termination or expiration in accordance with its terms or the
provisions of the Plan. Notwithstanding the foregoing, an option shall not
at any time be exercisable with respect to less than 100 shares unless the
remaining shares covered by an option are less than 100 shares. The
purchase price of the shares purchased pursuant to an option shall be paid
in full upon delivery to the optionee of certificates for such shares.
Exercise by an optionee's heir or personal representative shall be
accompanied by evidence of his or her

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<PAGE>

authority to act, in a form reasonably satisfactory to the Company.

(f) Options not Transferable. Options may not be sold, pledged,
assigned, or transferred in any manner otherwise than by will or the laws
of descent or distribution to the extent provided in Subsection 6(g).
During the lifetime of an optionee, the options shall be exercisable only
by the optionee. Following the death of an optionee, the options shall be
exercisable only to the extent provided in Subsection 6(g).

(g) Termination of Service as Director.

(i) Termination of Service for any Reason Other than Death. In
the event an optionee shall cease to serve the Company as a director
for any reason other than such optionee's death, each option held by
such optionee shall remain exercisable, subject to prior expiration
according to its terms and other limitations imposed by the Plan, for
a period of one (1) year following the optionee's cessation of service
as a director of the Company. If the optionee dies after such
cessation of service, the optionee's options shall be exercisable in
accordance with Subsection 6(g)(ii) hereof.

(ii) Termination of Service for Death or Permanent Disability.
If an optionee ceases to be a director by reason of death or Permanent
Disability, each option held by such optionee shall, to the extent
rights to purchase shares under the option have been accrued at the
time of death or Permanent Disability and shall not have been fully
exercised, be exercisable, in whole or in part, by (in the case of
Permanent Disability) the optionee or (in the case of death) the
personal representative of the optionee's estate or by any person or
persons who have acquired the option directly from the optionee by
bequest or inheritance during the shorter of the following periods:
(i) the term of the option, or (ii) a period of one (1) year from the
death or Permanent Disability of such optionee. If an optionee dies or
a Permanent Disability occurs during the extended exercise period
following cessation of service specified in Subsection

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<PAGE>

6(g) (i) above, such option may be exercised any time within the
longer of such extended period or one (1) year after death or
Permanent Disability, subject to the prior expiration of the term of
the option. For purposes of this Subsection 6(g)(ii), "Permanent
Disability" shall mean a determination by the Social Security
Administration or any similar successor agency that an optionee is
"permanently disabled," and the date on which a Permanent Disability
is deemed to have occurred shall be the date on which such
determination by such agency shall have been made.

(h) Adjustment in Shares Covered by Option. The number of shares
covered by each outstanding option, and the purchase price per share thereof,
shall be proportionately adjusted for any increase or decrease in the number of
issued and outstanding shares resulting from a split in or combination of shares
or the payment of a stock dividend on the shares or any other increase or
decrease in the number of such shares effected without receipt of consideration
by the Company.

If the Company shall be the surviving corporation in any merger or
consolidation or if the Company is merged into a wholly-owned subsidiary solely
for purposes of changing the Company's state of incorporation, each outstanding
option shall pertain to and apply to the securities to which a holder of the
number of shares subject to the option would have been entitled.

In the event of a Change in Control, except as otherwise provided in
the option agreement, any option awarded under this Plan to the extent not
previously exercisable shall immediately become fully exercisable. The Committee
in its sole discretion may direct the Company to cash out all outstanding
options on the basis of the Change in Control Price as of the date a Change in
Control occurs or such other date as the Committee may determine prior to the
Change in Control. For purposes of this Plan, a "Change in Control" means the
occurrence of any of the following: (i) when any "person" as defined in Section
3(a)(9) of the Securities Exchange Act of 1934 (the "Exchange Act") and as used
in Sections 13(d) and 14(d) thereof, including a "group" as defined in Section
13(d) of the Exchange Act but excluding the Company and any subsidiary and any
employee benefit plan sponsored or maintained by the Company or any subsidiary
(including any trustee of such plan acting as trustee), directly or indirectly,
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act,
as amended from time to time), after the effective date of the Plan, of
securities of the Company representing 20 percent or more of the combined voting
power of the Company's then outstanding securities; (ii) when, during any period
of 24 consecutive months during the existence of the Plan, the individuals who,
at the beginning of such period, constitute the Board of Directors of the
Company (the "Incumbent Directors") cease for any reason other than death to
constitute at least a majority thereof, provided, however, that a director who
was not a director at the beginning of such 24-month period shall be deemed to
have satisfied such 24-month requirement (and be an Incumbent Director) if such
director was elected by, or on the recommendation of or with the approval of,
least two-thirds of the directors who then qualified as Incumbent Directors
either actually (because they were directors at the beginning of such 24 month
period) or by prior operation of this provision; or (iii) the approval by the
stockholders of the Company of a transaction involving the acquisition of the
Company by an entity other than the Company or a subsidiary through purchase of
assets, by merger, or otherwise. For purposes of this Plan, "Change in Control
Price" means the highest price per share of Common Stock paid in any transaction
reported on the Nasdaq National Market or paid or offered in any bona fide
transaction related to a Change in Control at any time during the 60-day period
immediately preceding the occurrence of the Change in Control, in each case as
determined by the Committee.

In the event of a change in the shares as presently constituted, which
is limited to a change of all of its authorized shares with par value into the
same number of shares with a different par value or without par value, the
shares resulting from any such change shall be deemed to be the shares within
the meaning of the Plan.

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<PAGE>

To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Committee,
whose determination in that respect shall be final, binding and conclusive.
Any such adjustment may provide for the elimination of any fractional share
which might otherwise become subject to an option.

Except as expressly provided in this Subsection 6(h), the optionee
shall have no rights by reason of any split or combination of shares of
stock of any class or the payment of any stock dividend or any other
increase or decrease in the number of shares of stock of any class or by
reason of any dissolution, liquidation, merger, or consolidation or spinoff
of assets or stock of another corporation, and any issue by the Company of
shares of stock of any class, or securities convertible into shares of
stock of any class, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of stock
subject to the option.

The grant of an option pursuant to the Plan shall not affect in any
way the right or power of the Company to make adjustments,
reclassifications, reorganizations, or changes of its capital or business
structure, or to merge or to consolidate or to dissolve, liquidate or sell,
or transfer all or any part of its business or assets.

(i) Rights of a Stockholder. An optionee shall have no rights as a
stockholder with respect to any shares covered by his or her option until
the date on which the optionee becomes the holder of record of such shares.
No adjustment shall be made for dividends, distributions, or other rights
for which the record date is prior to the date on which he or she shall
have become the holder of record thereof, except as provided in Subsection
6(h).

(j) Postponement of Delivery of Shares and Representations. The
Company, in its discretion, may postpone the issuance and/or delivery of
shares upon any exercise of an option until completion of the registration
or other qualification of such shares under any state and/or federal law,
rule or regulation as the Company may consider appropriate, and may require
any person exercising an option

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<PAGE>

to make such representations, including a representation that it is the
optionee's intention to acquire shares for investment and not with a view
to distribution thereof, and furnish such information as it may consider
appropriate in connection with the issuance or delivery of the shares in
compliance with applicable laws, rules, and regulations. In such event no
shares shall be issued to such holder unless and until the Company is
satisfied with the accuracy of any such representations.

(k) Other Provisions. The option agreements authorized under the Plan
shall contain such other provisions, including, without limitation,
restrictions upon the exercise of the option, as the Committee shall deem
advisable.

7. Adjustments in Shares Available for Options. The adjustments in
number and kind of shares and the substitution of shares, affecting outstanding
options in accordance with Subsection 6(h) hereof, shall also apply to the
number and kind of shares reserved for issuance pursuant to the Plan, but not
yet covered by options.

8. Amendment of the Plan. The Committee, insofar as permitted by law,
shall have the right from time to time, with respect to any shares at the time
not subject to options, to suspend or discontinue the Plan or revise or amend it
in any respect whatsoever, and except that, without the approval of the
stockholders of the Company, no such revision or amendment shall:

(a) increase the maximum number of shares which may be subject to the
Plan,

(b) materially increase the benefits accruing to option holders under
the Plan,

(d) remove the administration of the Plan from the Committee, or

(e) permit the granting of options under the Plan after the Term of
the Plan.

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<PAGE>

9. Withholding of Taxes. The Company shall have the right to deduct from
any payment to be made pursuant to this Plan, or to otherwise require, prior to
the issuance or delivery of any shares of Common Stock, payment by the optionee
of any federal, state, or local taxes required by law to be withheld. Unless
otherwise prohibited by the Committee, an optionee may satisfy any such
withholding tax obligation by any of the following means or by a combination of
such means:

(a) tendering a cash payment;

(b) authorizing the Company to withhold from the shares otherwise
issuable to the optionee a number of shares having a Fair Market Value as
of the "Tax Date," less than or equal to the amount of withholding tax
obligation; or

(c) delivering to the Company unencumbered shares owned by the
optionee having a Fair Market Value, as of the Tax Date, less than or equal
to the amount of the withholding tax obligation.

The "Tax Date" shall be the date that the amount of tax to be withheld is
determined. Fair Market Value shall be determined in the manner specified in
Subsection 6(c), except as to the date of determination. An optionee's election
to pay the withholding tax obligation by either of (b) or (c) above shall be
irrevocable, may be disapproved by the Committee, and must be made either six
(6) months prior to the Tax Date or during the period beginning on the third
business day following the date of release of the Company's quarterly or annual
summary statement of sales and earnings and ending on the twelfth business day
following such date.

10. Right of Board of Directors or Stockholders to Terminate Director's
Service. Nothing in this Plan or in the grant of any option hereunder shall in
any way limit or affect the right of the Board of Directors or the stockholders
of the Company to remove any director or otherwise terminate his or her service
as a director, pursuant to the law, the Articles of Incorporation, or Bylaws of
the Company.

11. Application of Funds. The proceeds received by the Company from the
sale of stock pursuant to options will be used for general corporate purposes.

-9-
<PAGE>

12. No Obligation to Exercise Option. The granting of an option shall
impose no obligation on the optionee to exercise such option.

13. Construction. This Plan shall be construed under the laws of the
State of Delaware.

-10-

<PAGE>

DURA AUTOMOTIVE SYSTEMS, INC.

EMPLOYEE STOCK DISCOUNT PURCHASE PLAN
-------------------------------------

1. Title. The plan described herein shall be known as the Dura Automotive
Systems, Inc. Employee Stock Discount Purchase Plan (the "Plan"). The Plan
will be maintained by the Company and any of its subsidiaries that may adopt the
Plan from time to time in accordance with the procedures set forth in Section 22
hereof (each such adopting subsidiary referred to herein as a "Covered Entity")
with the Company's consent.

2. Purpose. The purpose of the Plan is to give employees wishing to do so
a convenient means of purchasing at a discount shares of Dura Automotive
Systems, Inc. Class A Common Stock (the "Shares") through payroll deductions.
The Company believes that ownership of Shares by employees will foster greater
employee interest in the Company's growth and development.

3. Shares Reserved for the Plan. There shall be reserved for issuance and
purchase by employees of the Company under this Plan an aggregate of 500,000
Shares, subject to adjustment as provided in Section 16 hereof. Shares subject
to the Plan may be shares now or hereafter authorized and unissued or shares
already authorized, issued and owned by the Company. The right to purchase
shares pursuant to the Plan shall be made available by a series of quarterly
offerings to employees eligible to participate in the Plan pursuant to Section 8
hereof. If and to the extent that any right to purchase reserved Shares shall
not be exercised by any employee for any reason or if such right to purchase
shall terminate as provided herein, Shares that have not been so purchased under
the Plan shall again become available for the purposes of the Plan during the
remaining term of the Plan.

4. Effective Date. The Plan shall become effective on the date of the
consummation of the initial public offering of the Company's Class A Common
Stock, par value $.01 per share (the "Effective Date").
<PAGE>

5. The Plan Year. The Plan shall operate on a fiscal year beginning on
the first day of January in each year and ending on the 31st day of December.
This fiscal year is referred to herein as the "Plan year."

6. Plan Quarters. The Plan year shall be divided into four Plan quarters
ending March 31, June 30, September 30 and December 31. Each such quarter is
referred to herein as a "Plan quarter."

7. Plan Administration. The Plan shall be administered by a Compensation
Committee of the Company's Board of Directors (the "Committee"). As Plan
administrator, the Committee shall have complete control of the administration
of the Plan, which includes the determination of employees, eligibility for
participation in accordance with the standards set forth in Section 8 hereof,
the interpretation of provisions of the Plan, the adoption of any rules or
regulations which may be necessary, advisable or desirable in the operation of
the Plan including rules governing the participation of officers and directors
in the Plan in order to exempt transactions under the Plan in accordance with
Rule 16b of the Securities and Exchange Commission, and the delegation of
certain of the duties of the Committee to an agent to facilitate the purchase
and transfer of Shares and to otherwise assist in the administration of the
Plan. The Committee shall control the general administration of the Plan with
all powers necessary to enable it to carry out its duties in that respect,
except that, if for any reason a Committee shall not have been appointed, all
authority and duties of the Committee under this Plan shall be vested in and
exercised by the Board of Directors of the Company.

8. Eligibility. Any employee of the Company (including, during the period
in which they are on location at a facility, any Co-op students) who is a
United States resident or who is a United States citizen temporarily on
location at a facility outside of the United States and any Covered Entity (as
defined in Section 22 hereof) shall be eligible to participate in the Plan on
the day next following the six-month anniversary of such employee's employment
provided such employee (i) regularly works at least 1,000 hours during the he
calendar year, (ii) has an average work week of 20 hours or more during the
period worked and (iii) would not own, immediately after the exercise of any
right granted hereunder, stock possessing five percent (5%) or more of the
combined voting power

-2-
<PAGE>

or value of all classes of capital stock of the Company. The Committee shall
determine which employees are eligible to participate in the Plan in accordance
with the standards set forth in this Section.

9. Election to Participate, Payroll Deductions and Lump Sum Contributions.
An eligible employee may elect to participate in the Plan on any day within the
Plan quarter in which such employee becomes eligible to participate, and
thereafter as of the first day of any Plan quarter, by correctly
completing and returning to the Company an enrollment form authorizing a
specified payroll deduction to be made from each subsequent paycheck for the
purchase of Shares under this Plan (the "payroll deduction"). The minimum
allowable payroll deduction is $10.00 per payroll period. All payroll
deductions shall be made regularly and in equal amounts and shall be credited on
the records of the Company in the name of the eligible employee. Such credit
shall constitute only a bookkeeping entry by the Company and no interest will be
paid or due on any money paid into this Plan or credited to such eligible
employee. Employees who elect to participate in the Plan are referred to herein
as "participating employees."

A participating employee will be deemed to have authorized the same payroll
deduction for each subsequent payroll period provided that he or she is eligible
to participate during each subsequent payroll period. A participating employee
may increase or decrease his or her payroll deduction as of the first day of the
first full payroll period with respect to such employee of any Plan quarter by
filing the required form, in the time and manner prescribed by the Committee.

Upon the request of any participating employee, the Company shall suspend
making any payroll deduction with respect to such employee as soon as
practicable after the employee notifies the Company of such request. In such
event, the earliest date upon which payroll deductions may be resumed with
respect to such employee shall be the first day of the Plan quarter occurring
immediately after the first full Plan quarter that follows the suspension of the
employee's payroll deductions.

In the event that an employee ceases to be a participating employee, or if
for any reason the Company does not

-3-
<PAGE>

invest the aggregate amount of payroll deductions of a participating employee,
the amount of payroll deductions not theretofore invested shall be returned to
such employee.

10. Limitation of Number of Shares That an Employee May Purchase. A
participant shall be allocated the number of Shares which may be purchased with
such participant's contributions; provided, that a participant may purchase no
more than 50 Shares in any Plan quarter under this Plan; and further provided
that an eligible employee whose purchases for the Plan year do not equal 200
Shares (or, in the case of any partial calender year in which the Plan is in
effect, a number of Shares equal to (i) the number of full or partial Plan
quarters in such year in which the Plan is in effect, multiplied by (ii) 50
Shares) shall be entitled to make a lump sum contribution to such
employee's cash account at any time during the period from January 1 through
January 15 of the following Plan year, the maximum amount of any such
contribution to be the amount necessary to purchase the number of Shares equal
to the difference between the participant's aggregate purchases for the
immediately preceding Plan year and 200 Shares (or such lesser number of Shares
for any partial Plan year as determined above). In the case of any such lump sum
contribution, the cost per Share shall be calculated as set forth in Section 12
hereof based upon the closing prices with respect to the immediately preceding
Plan quarter. Notwithstanding the foregoing, no right to purchase Shares under
this Plan shall permit an employee to purchase stock under all employee stock
purchase plans (as defined in Section 423 of the Internal Revenue Code) of the
Company at a rate which in aggregate exceeds $25,000 of fair market value of
such stock (determined at the time the right is granted) for each calendar year
in which the right is outstanding at any time. In addition, the total number of
Shares purchased under the Plan shall not exceed 500,000 and if, for any
purchase date, the number of Shares to be purchased with participants' cash
account balances, when aggregated with all prior purchases under the Plan, would
exceed 500,000 Shares, allocations to participants for such purchase date shall
be reduced pro rata in accordance with their respective cash account balances,
so that the total allocations shall not cause the total Shares purchased under
the Plan to exceed 500,000 Shares.

-4-
<PAGE>

11. Accounting for Participant Contributions. The Committee will cause to
be established a "cash account" and a "Share account" for each participant under
the Plan for bookkeeping purposes. As soon as practicable on or after the last
day of each Plan quarter, but in no case later than the fifteenth day of the
month immediately following the end of the Plan quarter, the Committee will
credit each participant's cash account with such participant's payroll
deductions during the Plan quarter ("credited payroll deductions"). The date of
crediting of such credited payroll deductions is referred to herein as the
"deduction crediting date." The Company shall not be required to pay or accrue
interest on the cash balances in participants' cash accounts or on the value of
participants' Share accounts.

12. Share Purchases. The Committee will use the entire balance of funds in
participants' cash accounts to purchase Shares to be allocated to participants'
Share accounts within the first 15 working days following each deduction
crediting date. The cost per Share to participants will be 85% of the lower of
the closing price for the Shares on the Nasdaq National Market ("Nasdaq") on the
first or the last day of the Plan quarter with respect to which such purchase
relates; provided that if the first or last day of the Plan quarter is a day on
which Nasdaq is closed, the price for such day shall be determined as of the
last preceding day on which Nasdaq is open.

13. Allocation of Shares. As soon as practicable after all necessary
Shares have been purchased by the Committee (or its agent) for the benefit of
participants, the Committee will allocate such Shares to participants' Share
accounts (the date of such allocation to be referred to as the "Share allocation
date") in the following manner:

(a) The Committee will allocate full Shares and fractional Shares to the
Share accounts of the individual participants to the extent of the balances in
their respective cash accounts, subject to the limitations set forth in Section
10. The cash accounts will be charged with the cost to participants of all
Shares so allocated. No cash balances will remain in the participants' cash
accounts immediately after each Share allocation date;

-5-
<PAGE>

(b) Until certificates are issued, no person shall have any right to sell,
assign, mortgage, pledge, hypothecate or otherwise encumber any of the Shares
allocated to a participant's Share account.

14. Issuance of Share Certificates. Share certificates for the number of
whole Shares in each participant's Share account may be issued to participants
only upon the receipt by the Committee (or its agent) of a participant's written
request indicating the number of Shares (to a maximum of the number of full
Shares in the participant's Share account) for which the participant wishes to
receive certificates. Such request shall be made on a form at the time
prescribed by the Committee and filed with the Committee (or its agent). Share
certificates shall be issued to the participant as soon as practicable after the
end of a Plan quarter.

15. Expenses. The Company or the Covered Entity will bear the costs
associated with administering the Plan and purchasing Shares. No expenses
attributable to a participant's sale of Shares, however, will be borne by the
Company or the Covered Entity.

16. Cash Dividends, Share Splits and Distributions.

(a) Cash Dividends. Cash dividends attributable to Shares allocated to
participants' Share accounts as of the record date for which such cash dividends
are declared will be credited to participants' cash accounts as of the dividend
payment date and applied to Share purchases and allocations on the next Share
allocation date in accordance with the methods set forth in Sections 12 and 13
hereof.

(b) Share Distributions and Share Splits. Share distributions and Share
splits attributable to Shares allocated to participants' Share accounts as of
the Share distribution record date or the Share split effective date will be
credited directly to participants' Share accounts as of the record date and the
effective date, respectively, of such Share distributions and such Share splits.

-6-
<PAGE>

Share rights or warrants with respect to Shares. Following and as of the record
date for determining those shareholders of record entitled to receive Share
rights or warrants with respect to their Shares, the Company shall issue, and
the Committee shall allocate, such Share rights and/or warrants directly to the
appropriate participants as though the Shares allocated to the account of each
such participant were held of record by such participant. Certificates
representing such Share rights or warrants, if any such certificates have been
authorized by the Board of Directors of the Company, may be issued to
participants pursuant to the procedures set forth in Section 14 of this Plan.

(d) Change in Common Stock. In the event of a reorganization,
recapitalization, stock split, merger, consolidation or other increase or change
in the common stock of the Company, the Committee may make appropriate changes
in the number and type of Shares that at the time of such event remain available
for purchase under this Plan.

17. Voting Rights. Holders of Shares have the right to vote on matters
affecting the Company. If one of these matters is submitted to the shareholders
for a vote, then following the record date for any shareholder meeting at which
such vote is to occur, the Committee shall advise the Company of the number of
participants for whom Shares are held in Share accounts on such record date, and
the Company shall furnish the Committee (or its agent) with sufficient sets of
its proxy soliciting materials to deliver one set to each such participant.
The Committee shall thereupon forward one set to each participant for whom
allocated Shares are being held and request voting instructions. Upon receipt
of voting instructions, the Committee shall vote the Shares as instructed. The
Committee shall not vote any Share allocated to a participant's Share account
unless voting instructions have been received from the participant.

18. Records and Reports to Participants. The Committee shall cause to be
maintained true and accurate books of account, and a record of all transactions
under the Plan, and such accounts, books and records relating thereto shall be
open to inspection and audit by such person or persons designated by the
Company. At least annually, but in all cases on or before March 31 of each year,
the Committee shall file with the Chief Financial Officer of the Company a
written report setting forth
-7-
<PAGE>

all receipts and disbursements and other transactions effected on behalf of the
Plan during the last preceding Plan year, including a description of all Shares
purchased together with the cost of all such Shares. Such report shall also
disclose any liabilities of the Plan and shall show, as of the close of the Plan
year, the value of each active cash account and Share account of each
participant together with the record of Share certificates delivered to each of
the participants during such Plan year. The Committee shall have the right to
maintain one or more bank accounts for funds contributed to the Plan, and to
make deposits in and withdrawals therefrom in connection with its administration
of the Plan.

An annual report shall be rendered to each participant in the Plan annually
within 90 days after the close of the Plan year, showing for the Plan year just
ended:

(a) the amounts of employee payroll deductions made for each participant;

(b) the amounts of cash dividends credited to such participant's cash
account;

(c) the number of Shares acquired for such participant's Share account
(including the amounts of Share distributions or Share splits so allocated or
credited);

(d) the cost to the participant per Share of Shares purchased for such
participant;

(e) the number of Shares, if any, for which certificates were delivered to
such participant; and

(f) the beginning and ending balances in the participant's Share and cash
accounts.

19. Termination of Employment. Settlement of the accounts of participants
whose employment has terminated shall be made as of the beginning of the Plan
quarter following the Plan quarter in which termination of employment occurred.

As promptly as practicable after the close of the Plan quarter in which
termination of employment occurred, the

-8-
<PAGE>

Committee will deliver to such former participant a certificate for the number
of full Shares allocated to such participant's account and not previously
distributed, together with a check for (i) any remaining cash balance and (ii)
the value of any fractional Shares allocated to such participant's account.

In the event of a participant's death, settlement will be made to the
participant's designated beneficiary, if any. If no beneficiary has been
designated, or if such beneficiary does not survive the participant, settlement
will be made to the participant's duly appointed legal representative after the
satisfaction of any applicable legal requirements.

20. Amendment and Termination of the Plan. Subject to the provisions of
Section 423 of the Internal Revenue Code and Rule 16b-3 under the Securities
Exchange Act of 1934, the Board of Directors may amend this Plan in any respect;
provided, that no amendment may affect any participant's right to the benefit of
contributions made by such participant prior to the date of the amendment.

The Board of Directors reserves the right to terminate this Plan at the end
of any Plan quarter. In the event of termination of the Plan, the Committee
will make an allocation of Shares to the Share accounts of the participants in
the usual manner. As soon as practicable, the Committee will distribute to or
on behalf of each participant all of the Shares held in such participant's Share
account plus an amount of cash equal to the balance in such participant's cash
account.

21. Limitation on Sale of Shares. No Shares will be sold under the Plan
to any employee residing or employed in any jurisdiction where the sale of such
Shares is not permitted under the applicable laws.

22. Adopting Subsidiaries. Any subsidiary of the Company may adopt the
Plan on behalf of its employees either unilaterally or by collective bargaining
by filing with the Company a certified copy of a resolution of the Board of
Directors (or other appropriate authorization satisfactory to the Secretary of
the Company) of the subsidiary providing for such subsidiary's adoption of the
Plan and a certified copy of a resolution of the Board of Directors of the
Company consenting to
-9-
<PAGE>

such adoption. Each such adopting subsidiary is referred to herein as a "Covered
Entity."

-10-

<PAGE>

EXHIBIT 23.1

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our report
and to all references to our Firm included in or made a part of this
registration statement.

ARTHUR ANDERSEN LLP

Minneapolis, Minnesota,
August 5, 1996

<PAGE>

EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our report
and to all references to our Firm included in or made a part of this
registration statement.

ARTHUR ANDERSEN LLP

Kansas City, Missouri,
August 5, 1996

<PAGE>

<ARTICLE> 5
<MULTIPLIER> 1,000

<S> <C> <C>
<PERIOD-TYPE> YEAR 6-MOS
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1996
<PERIOD-START> JAN-01-1995 JAN-01-1996
<PERIOD-END> DEC-31-1995 JUN-30-1996
<CASH> 1,732 3,239
<SECURITIES> 0 0
<RECEIVABLES> 34,990 40,760
<ALLOWANCES> 0 0
<INVENTORY> 11,916 10,278
<CURRENT-ASSETS> 59,299 60,480
<PP&E> 36,707 36,182
<DEPRECIATION> (10,246) (12,847)
<TOTAL-ASSETS> 140,531 139,362
<CURRENT-LIABILITIES> 45,598 46,480
<BONDS> 0 0
<COMMON> 50 50
0 0
0 0
<OTHER-SE> 27,633 32,777
<TOTAL-LIABILITY-AND-EQUITY> 140,531 139,362
<SALES> 253,726 127,357
<TOTAL-REVENUES> 253,726 127,357
<CGS> 220,274 109,141
<TOTAL-COSTS> 220,274 109,141
<OTHER-EXPENSES> 15,892 8,058
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 4,822 1,900
<INCOME-PRETAX> 16,978 8,258
<INCOME-TAX> 6,852 3,304
<INCOME-CONTINUING> 10,126 4,954
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 10,126 4,954
<EPS-PRIMARY> 2.03 .99
<EPS-DILUTED> 2.03 .99

</TABLE>