CRAGAR INDUSTRIES INC /DE, 10QSB/A, 2000-04-27

CRAGAR INDUSTRIES INC /DE
10QSB/A, 2000-04-27
MOTOR VEHICLE PARTS & ACCESSORIES

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-QSB/A

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

For the Quarterly Period Ended September 30, 1999

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the Transition Period from _________ to __________

Commission File No. 1-12559

CRAGAR INDUSTRIES, INC.
(Name of small business issuer in its charter)

DELAWARE 86-0721001
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)

4636 NORTH 43RD AVENUE, PHOENIX, ARIZONA 85031
(Address of principal executive offices)

(623) 247-1300
(Issuer's telephone number)

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

Number of shares of common stock, $.01 par value, outstanding as of April 27,
2000: 2.46 million.

Transitional small business disclosure format. Yes [ ] No [X]

<PAGE>

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits
EXHIBIT NO. DESCRIPTION
------------- -----------
3.1* Second Amended and Restated Certificate of
Incorporation of the Registrant filed with the State
of Delaware on October 1, 1996

3.2* Amended and Restated Bylaws of the Registrant

10.1+ Agreement of Purchase and Sale of Assets by and
between Cragar Industries, Inc. and Carlisle Tire and
Wheel Co.

10.2+ Exclusive Field of Use License Agreement by and
between Cragar Industries, Inc. and Carlisle Tire and
Wheel Co.

10.3+ Agreement of Purchase and Sale of Assets by and
between Cragar Industries, Inc. and Weld Racing, Inc.

10.4+ Exclusive Field of Use License Agreement by and
between Cragar Industries, Inc. and Weld Racing, Inc.

11++ Schedule of Computation of Earnings per Share

27.1++ 1999 Financial Data Schedule for the Three and Nine
Months Ended September 30, 1999

(b) Reports on Form 8-K

None

- ------------------
* - Incorporated by reference to the Company's Registration Statement on
Form SB-2 (No. 333-13415).

+ - Filed herewith

++ - Previously filed with the Company's 10-QSB on November 15, 1999.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

CRAGAR INDUSTRIES, INC.

Dated: April 27, 2000 By: /s/MICHAEL L. HARTZMARK
-------------- ---------------------------
Michael L. Hartzmark
President and CEO

Dated: April 27, 2000 By: /s/RICHARD P. FRANKE
-------------- ---------------------------
Richard P. Franke
Chief Financial Officer
(Principal Financial and
Accounting Officer)

<PAGE>

EXHIBIT 10.1

This Exhibit contains confidential information which has been omitted and
filed separately with the Security and Exchange Commission pursuant to a
confidential treatment request under rule 24b-2 of the Securities and
Exchange Act of 1934. The confidential information has been replaced with
asterisks.

AGREEMENT OF PURCHASE AND SALE OF ASSETS

BY AND BETWEEN

CRAGAR INDUSTRIES, INC.

AND

CARLISLE TIRE & WHEEL CO.

OCTOBER 15, 1999

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TABLE OF CONTENTS

DESCRIPTION PAGE
- ----------- ----
<S> <C>
ARTICLE 1 OVERVIEW.......................................................................................1
ARTICLE 2 THE TRANSACTION................................................................................1
2.1 Acquired Assets................................................................................1
2.2 Assets Not Being Acquired......................................................................2
2.4 Assumed Liabilities............................................................................3
2.5 Purchase Price.................................................................................3
2.6 Payment of Purchase Price......................................................................3
2.7 Intentionally Left Blank.......................................................................3
2.8 License Agreement..............................................................................3
2.9 Right of Recision..............................................................................4
2.10 Collection of Accounts Receivable..............................................................4
2.11 Employees......................................................................................4
2.12 Allocation of Purchase Price...................................................................4
2.13 Transfer Fees and Taxes; Prorations............................................................4
2.14 Relocation of Assets...........................................................................5
2.15 Warranty Claims................................................................................5
ARTICLE 3 CONDUCT PENDING THE CLOSING....................................................................5
3.1 Operation of Business in Ordinary Course.......................................................5
3.2 No Negotiations................................................................................6
3.3 Public Announcements...........................................................................6
3.4 Confidentiality................................................................................6
3.5 Access to Information..........................................................................6
3.6 HSR Act........................................................................................7
ARTICLE 4 THE PARTIES' OBLIGATIONS AT THE CLOSING........................................................7
4.1 The Closing....................................................................................7
4.2 Seller's Obligations...........................................................................7
4.3 Buyer's Obligations............................................................................8
4.4 Conditions to Closing..........................................................................8
ARTICLE 5 REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION................................................9
5.1 Representations Relating to the Business.......................................................9
5.2 Representations of Buyer.......................................................................9
5.3 Nature and Survival of Representations and Warranties..........................................9
5.4 Indemnification by Seller.....................................................................10
5.5 Indemnification by Buyer......................................................................10
5.6 Limits on Indemnification.....................................................................10
5.7 Procedure for Indemnification.................................................................10
ARTICLE 6 ADDITIONAL AGREEMENTS.........................................................................10
6.1 Termination...................................................................................11
6.2 Effect of Termination.........................................................................11
6.3 Transaction Expenses..........................................................................11
6.4 Notices.......................................................................................11
6.5 Governing Law and Attorneys' Fees.............................................................12
6.6 Arbitration...................................................................................12
6.7 Assignment....................................................................................12
6.8 Intent to be Binding..........................................................................12
</TABLE>

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<TABLE>
<S> <C>
6.9 Waiver of Provisions..........................................................................13
</TABLE>

Schedule 1 Inventory - as of October 15, 1999
Schedule 2 Equipment - as of February 19, 1999
Schedule 3 Equipment - supplemental list
Schedule 4 Customer Orders
Schedule 5 Vendor Orders
Schedule 6 Contracts
Schedule 7 Product Warranties

Exhibit A Definitions
Exhibit B Representations and Warranties of Seller
Exhibit C Representations and Warranties of Buyer
Exhibit D Procedure for Indemnification
Exhibit E Exclusive Field of Use License Agreement

<PAGE>

AGREEMENT OF PURCHASE AND SALE OF ASSETS

This Agreement is made as of October 15, 1999, by and between Carlisle
Tire & Wheel Co. (defined to include any subsidiaries, affiliates, partnerships,
shareholders, or other related parties), a Delaware corporation (the "BUYER"),
and Cragar Industries, Inc., a Delaware corporation (the "SELLER").

ARTICLE 1
OVERVIEW

1.1 Seller engages in the business of, among others, manufacturing and
selling vehicle wheels with steel outer rims and related accessories (the "SOR
WHEEL BUSINESS").

1.2 For purposes of this Agreement, certain capitalized terms have the
meanings ascribed to them in EXHIBIT A. Other terms are defined in the body of
this Agreement.

ARTICLE 2
THE TRANSACTION

2.1 ACQUIRED ASSETS. Seller agrees to sell and deliver to Buyer the
following assets of the SOR Wheel Business (the "ACQUIRED ASSETS"):

(a) INVENTORY. All inventories selected by Buyer of supplies,
packaging, raw materials, purchased parts and components, work-in-process and
finished goods of Seller related to the SOR Wheel Business, including, but not
limited to, all such items at Seller's facility or ordered but not yet received
by Seller as of the Closing Date (collectively, "INVENTORY"). A list of the
Inventory to be purchased, which was generated by the computer records of the
Seller, but has not been verified by a physical count is on SCHEDULE 1;

(b) EQUIPMENT. All machinery, equipment, tooling, dies, molds,
perishable tools, fixtures, chucks, shop tools, furniture, test benches,
harnesses, hardware, spare parts, and other tangible personal property owned by
or in the possession of Seller and related to the SOR Wheel Business, whether or
not located at the Seller's facility or in the custody of any of Seller's
suppliers selected by Buyer (collectively, the "EQUIPMENT"). A list of certain
Equipment appraised as of February 19, 1999 is listed on SCHEDULE 2, and a
supplemental list of all other Equipment to be purchased is attached as SCHEDULE
3;

(c) CUSTOMER ORDERS. All of Seller's rights under each
uncompleted customer order related to the SOR Wheel Business as of the Closing
Date (collectively,

1
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the "CUSTOMER ORDERS"). A list of Customer Orders to be purchased is attached
as SCHEDULE 4;

(d) VENDOR ORDERS. All of Seller's rights under each
uncompleted vendor orders related to the SOR Wheel Business (collectively,
the "VENDOR ORDERS"). A list of Vendor Order to be purchased is attached as
SCHEDULE 5; and

(e) CONTRACTS. All of Seller's rights under the executory
contracts related to the SOR Wheel Business listed in Schedule 6;

(f) WARRANTY RIGHTS. All rights of Seller under express or
implied warranties from the suppliers of Seller with respect to any of the
Acquired Assets to the extent such rights may be assigned to Buyer;

(g) INFORMATION. All operational information, together with
originals or copies of all books, records and accounts, engineering data,
design data, drawings, manuals, correspondence, records, customer lists,
marketing information, promotional material, catalogs, brochures and any
other information which has been reduced to writing relating to or arising
out of the SOR Wheel Business.

2.2 ASSETS NOT BEING ACQUIRED. The following assets are expressly
excluded from the assets to be delivered to Buyer (the "EXCLUDED ASSETS"):

(a) the minute books, corporate tax returns, and other
documents relating to the organizational existence of Seller as a corporation;

(b) any cash, loans and marketable securities of Seller;

(c) any of Seller's assets or properties unrelated to the
SOR Wheel Business including, without limitation, the Seller's business
relating to the manufacture, assembly, and marketing of vehicle wheels made
with aluminum outer rims, motorcycle wheels made from any material and
one-piece aluminum vehicle wheels and related accessories.

(d) any tax refunds paid or payable to Seller;

(e) all customer and vendor orders which Buyer elects not
to acquire and are not listed on SCHEDULE 4 or SCHEDULE 5;

(f) all deposits;

(g) all other assets not listed on Schedules 1 through 5
attached here to; and

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(h) Unless otherwise set forth in this Agreement, all
liabilities associated with employees of Seller.

2.4 ASSUMED LIABILITIES. Except as provided in SECTION 2.15, and
except for the Customer Orders and Vendor Orders acquired by Buyer, Buyer
will not assume any liabilities of Seller and nothing contained in this
Agreement shall be construed as an assumption by Buyer of, any liabilities,
obligations or undertakings of any nature whatsoever, whether fixed or
contingent, known or unknown, disclosed or undisclosed, and Seller shall be
responsible for all of the liabilities, obligations and undertakings not
specifically assumed by Buyer (collectively, the "Retained Liabilities").
Seller agrees to pay, perform or discharge the Retained Liabilities in
accordance with their respective terms. Seller and Buyer will mutually
cooperate in order to consummate assignment of the Customer Orders and Vendor
Orders to Buyer, and Buyer will assume all liabilities and obligations under
the Customer Orders and Vendor Orders which relate to events occurring after
the Closing date.

2.5 PURCHASE PRICE. In addition to the payments to be made by Buyer
under the License Agreement, Buyer will pay to Seller the sum of the
following amounts ("PURCHASE PRICE"):

(a) an amount equal to 95% of Seller's standard cost of the
Inventory for the list on SCHEDULE 1;

(b) an amount equal to one hundred thousand dollars
($100,000.00) for the Equipment listed on SCHEDULE 2; and

2.6 PAYMENT OF PURCHASE PRICE. Buyer will pay the Purchase Price, in
immediately available funds, as follows:

(a) Buyer shall pay for the Inventory upon terms of
immediately available funds at the Closing Date, subject to a physical count on
the Closing Date, or upon removal from the Seller's facility if movement takes
place prior to the Closing Date;

(b) Buyer shall pay for the Equipment at the Closing Date;

2.7 [Intentionally Left Blank]

2.8 LICENSE AGREEMENT. Buyer and Seller further agree that as of the
Closing Date Buyer will enter into a License Agreement with Seller for use of
the "Cragar" name and other intangible assets as set forth in Exhibit E.

<PAGE>

2.9 RIGHT OF RECISION. If Buyer at any time defaults under the License
Agreement (and such default is not cured within the period specified in the
License Agreement), then Seller may, at its sole discretion, repurchase any and
all (at Seller's sole discretion) of the Acquired Assets upon the same terms and
at the Purchase Price provided herein.

2.10 COLLECTION OF ACCOUNTS RECEIVABLE.

(a) Seller will retain the title to all accounts and notes
receivable of Seller related to the SOR Wheel Business as of the Closing Date
(the "RETAINED ACCOUNTS"). If any customer makes any payments to Buyer for the
Retained Accounts, then Buyer will immediately advance such funds to Seller.
Seller will provide to Buyer on a weekly basis a listing of those Retained
Accounts which have past due amounts owing to the Seller. Buyer agrees it will
work with Seller and make all commercially reasonable efforts to assist
Seller in collecting past due amounts owing to Seller.

(b) Buyer will be entitled to all accounts and notes
receivable related to the SOR Wheel Business which relate to periods following
the Closing Date (the "POST-CLOSING ACCOUNTS"). If any customer issues to Seller
a credit or takes a credit upon payment on Retained Accounts which should be
applied to the Post-Closing Accounts, then Buyer will immediately reimburse such
funds to Seller. If any customer makes any payments to Seller for the
Post-Closing Accounts, then Seller will immediately advance such funds to Buyer.

2.11 EMPLOYEES. Seller will be responsible for any severance and/or
other payments, including accrued vacation and sick time, sick pay, and other
compensation, benefits, and perquisites, incurred in connection with the
termination of any of its employees. Seller will cooperate with Buyer and make
reasonable efforts to make available to Buyer the non-exclusive services of
Michael Hartzmark, Michael Miller, and Tony Cortes (collectively, the
"TRANSITION EMPLOYEES"). Seller agrees to pay the salary and benefits for the
Transition Employees for a period of up to 90 days following the Closing;
PROVIDED, HOWEVER, that Buyer will pay for all travel costs incurred by the
Transition Employees. Notwithstanding the foregoing, Seller shall not be liable
to Buyer if any of the Transition Employees refuse at any time to work for Buyer
or are otherwise unavailable.

2.12 ALLOCATION OF PURCHASE PRICE. Promptly following the Closing,
Buyer and Seller will mutually determine the manner in which the Purchase Price
will be allocated among the Acquired Assets, and Seller and Buyer agree to
report the allocation on Internal Revenue Service Form 8594, Asset Acquisition
Statement, which they will file with their respective federal income tax returns
for the tax year that includes the Closing Date.

<PAGE>

and local real and personal property taxes relating to the Acquired Assets.
Seller will also be responsible for any Tax in respect of the Business or the
Acquired Assets related to any period prior to the Closing date.

2.14 RELOCATION OF ASSETS. All Acquired Assets which are at Seller's
facility will be relocated at Buyer's expense as soon as is reasonably practical
after the Closing Date. Buyer and its agents will be given complete and
unrestricted access to and use of such facilities and premises for that purpose.
Buyer may occupy and use the leased facility for up to six months following the
Closing Date or until Seller rejects the Lease or Seller's plan of sublease,
whichever occurs first. Thereafter, if Buyer wishes to continue to use any of
such facilities, Buyer will be responsible for making arrangements therefor with
the owner(s) of such facilities. For its use of such facilities, Buyer will pay
rent to Seller equal to the monthly rent payable by Seller to the owner of such
facilities, except that the first month of Buyer's use of the leased facility
will be rent free. Buyer shall bear the costs of utility services incurred at
facilities during its occupancy of such facilities. Buyer shall repair or cause
to be repaired, at its expense, all damage caused by its agents in removing such
assets.

2.15 WARRANTY CLAIMS. Buyer will be responsible for all product
warranty returns for all products manufactured or sold by Buyer after the
Closing Date. Buyer will be responsible for replacing or repairing at Buyer's
cost all defective SOR Wheel Business products manufactured by Seller before
the Closing Date or by Buyer after the Closing Date within the limitations of
Buyer's normal business practices for such Products; PROVIDED, HOWEVER, that,
Buyer shall not be required to pay for all warranty claims which relate to
products manufactured by Seller prior to the Closing Date which are in excess
of (i) $50,000 during the first six month period following the Closing Date,
(ii) $50,000 during the second six month period following the Closing Date,
(iii) $25,000 during the third six month period following the Closing Date, (iv)
$25,000 during the fourth sixth month period following the Closing Date, and
(v) $25,000 during the third twelve month period following the Closing Date.
Buyer shall be required to pay for warranty claims which relate to products
manufactured by Seller prior to the Closing Date beginning in the fourth year
following the Closing Date. Buyer shall notify Seller of warranty claims which
are the responsibility of the Seller and Seller shall have the opportunity to
accept or reject such claims.

ARTICLE 3
CONDUCT PENDING THE CLOSING

3.1 OPERATION OF BUSINESS IN ORDINARY COURSE. Prior to the Closing,
Seller will conduct its SOR Wheel Business and affairs only in the ordinary
course and consistent with its prior practice including, but not limited to:

<PAGE>

(a) using its reasonable best efforts to maintain its SOR
Wheel Business and sales representatives, customers, assets, suppliers,
licenses and operations in accordance with past custom and practice;

(b) not entering into any transaction related to the SOR
Wheel Business other than in the ordinary course of business, or any
transaction with affiliated persons or entities; and

(c) not (i) incurring any debt other than in the ordinary
course of business and in amounts consistent with past practices; (ii) making
any loans; or (iii) increasing the compensation, incentive arrangements or
other benefits of any employee other than in the ordinary course of business
consistent with past practices.

Seller shall notify Buyer of any material adverse change in the ordinary
course of Seller's business, of any governmental or third party complaints,
investigations, or hearings (or communications indicating that any may be
contemplated), or of any breach by Seller of any agreement, representation or
warranty hereunder.

3.2 NO NEGOTIATIONS. Neither Seller nor any of its Representatives
will, directly or indirectly, solicit or participate in any negotiations
regarding any proposal or offer from any person or entity (including any of
its or their officers or employees) relating to any material transaction,
business combination, or sale of the SOR Wheel Business or the Acquired
Assets (other than the sale of assets in the ordinary course). Seller will
promptly notify Buyer if any person contacts Seller or inquires about any
such proposal or offer.

3.3 PUBLIC ANNOUNCEMENTS. The parties will not issue any press
release or public announcement, including announcements to employees or
customers, with respect to this Agreement without the prior written consent
(which consent will not be withheld unreasonably) of Buyer or Seller, as the
case may be.

3.4 CONFIDENTIALITY. All information concerning a party provided to
the other party, other than publicly available information, will be kept in
strict confidence by such other party and will only be used to evaluate the
other party in conjunction with the transaction contemplated by this
Agreement. If this Agreement is terminated, all documents or other media
containing such information will be returned to the appropriate party.
Subject to the limitations above, nothing herein precludes a party from
developing or offering products or services competitive with those of the
other party, so long as Buyer's rights under the License Agreement are not
infringed upon. The parties may disclose information to their Representatives
so long as they agree to keep such information confidential.

3.5 ACCESS TO INFORMATION.

(a) Buyer and its Representatives will have the opportunity
to make a complete due diligence review of the books, records, business, and
affairs of Seller,

<PAGE>

including, the Acquired Assets and the leased premises. To facilitate the due
diligence review, Seller will provide to Buyer and its Representatives complete
access to all of Seller's records and documents, will provide Buyer with
personal, bank, and professional references, and will make available for
consultation customers, employees, suppliers, and distribution channels.

3.6 HSR ACT. To the extent required by law, Seller and Buyer shall each
file with the FTC and the DOJ any notifications required to be filed by their
respective "ultimate parent entities" under the HSR Act, with respect to the
transactions contemplated herein. Each party shall be responsible for all
expenses incurred in the preparation of their respective HSR Act filings and the
filing fees to be paid in connection with the HSR Act filings. The parties shall
use their reasonable best efforts to make such filings promptly, to respond to
any requests for additional information made by either the FTC or DOJ, and to
cause the waiting periods under the HSR Act to terminate or expire at the
earliest possible date.

ARTICLE 4
THE PARTIES' OBLIGATIONS AT THE CLOSING

4.1 THE CLOSING. The closing ("CLOSING") of these transactions will
be held within five business days of the date Seller obtains any and all
consents required to consummate the transaction contemplated herein, but in
no event later than January 15, 2000, unless both parties agree to extend the
date, and at a time and place as the parties mutually agree.

4.2 SELLER'S OBLIGATIONS. At the Closing, Seller will deliver the
following:

(a) physical possession, as possible, of the Acquired Assets
in accordance with SECTION 2.1;

(b) releases of all liens, encumbrances and security interests
in respect of the Acquired Assets and evidences of all payoffs;

(c) all needed third-party consents, including but not limited
to holders of Seller's outstanding common and preferred stock, Board of
Directors, Seller's Senior Lender (Bank of America Commercial Funding Commercial
Finance), other secured lenders and consents required to transfer the contracts;

(d) the License Agreement referred to in Section 2.8;

(e) an executed Bill of Sale, satisfactory to Buyer and
Seller, which conveys to Buyer legal title to all of the Acquired Assets;

(f) certified resolutions of the Seller's Board of Directors
and shareholders approving this Agreement;

<PAGE>

(g) certificates from the state taxing authorities as evidence
that all sales and use tax liabilities of Seller accruing before the Closing
Date have been fully satisfied; and

(h) opinion of Seller's counsel satisfactory to Buyer.

4.3 BUYER'S OBLIGATIONS. At the Closing, Buyer will deliver the
following:

(a) Payment of the Purchase Price in accordance with SECTION
2.6;

(b) certified resolutions of the Board of Directors of Buyer
necessary to approve this Agreement;

(d) the License Agreement referred to in SECTION 2.8.

4.4 Conditions to Closing

(a) The obligation of Buyer to consummate the transaction
contemplated by this Agreement shall be subject to the fulfillment, or the
waiver by Buyer, on or prior to the Closing Date, of the following conditions:

I. SELLER'S OBLIGATIONS. Delivery by Seller of
all items set forth in Section 4.2.
II. REPRESENTATIONS AND WARRANTIES TRUE AT THE
CLOSING DATE. The representations and
warranties of Seller contained in this
Agreement shall be deemed to have been made
on and as of the Closing Date and shall then
be true and correct in all material
respects.
III. LITIGATION. No claim, action, suit,
investigation or other proceeding shall be
pending or threatened by any third party
(including any governmental agency) before
any court or administrative agency
challenging or otherwise relating to the
transactions provided for in this Agreement
or which may adversely affect Seller's
ability to fulfill its obligations under
this Agreement and the License Agreement.
IV. HSR ACT. Any applicable waiting period (and
any extension thereof) under the HSR Act
relating to the transactions contemplated
hereby shall have expired or been terminated

(b) The obligation of Seller to consummate the transaction
contemplated by this Agreement shall be subject to the fulfillment, or the
waiver by Seller, on or prior to the Closing Date, of the following conditions:

<PAGE>

I. BUYERS'S OBLIGATIONS. Delivery by Buyer of
all items set forth in Section 4.3.
II. REPRESENTATIONS AND WARRANTIES TRUE AT THE
CLOSING DATE. The representations and
warranties of Buyer contained in this
Agreement shall be deemed to have been made
on and as of the Closing Date and shall then
be true and correct in all material
respects.
III. LITIGATION. No claim, action, suit,
investigation or other proceeding shall be
pending or threatened by any third party
(including any governmental agency) before
any court or administrative agency
challenging or otherwise relating to the
transactions provided for in this Agreement
or which may adversely affect Buyer's
ability to fulfill its obligations under
this Agreement and the License Agreement.
IV. HSR ACT. Any applicable waiting period (and
any extension thereof) under the HSR Act
relating to the transactions contemplated
hereby shall have expired or been terminated
V. Approvals. Seller shall have received all
required approvals related to this Agreement
and the License Agreement and the
transaction contemplated therein from its
Board of Directors, Shareholders and all
necessary third parties.

ARTICLE 5
REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION

5.1 REPRESENTATIONS RELATING TO THE SOR BUSINESS. Concurrently with the
signing of this Agreement, Seller has prepared a Disclosure Letter which
discloses certain information to Buyer. Seller acknowledges that Buyer is
relying on the accuracy of the representations and warranties contained in
EXHIBIT B. Accordingly, Seller warrants to Buyer that, except for those matters
which have been disclosed to Buyer in the Disclosure Letter, each of the
representations and warranties contained in EXHIBIT B are true and correct (in
all material respects) on the date of this Agreement, and will again be true and
correct (in all material respects) on the Closing Date.

5.2 REPRESENTATIONS OF BUYER. Buyer acknowledges that Seller is relying
on the accuracy of the representations and warranties contained in EXHIBIT C.
Accordingly, Buyer warrants to Seller that each of the representations and
warranties contained in EXHIBIT C are true and correct (in all material
respects) on the date of this Agreement, and will again be true and correct (in
all material respects) on the Closing Date.

5.3 NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Each
statement and agreement made by any of the parties in this Agreement or in any
document or other

<PAGE>

instrument delivered by or on behalf any of the parties pursuant to this
Agreement will survive for a period of two (2) years following the Closing of
this Agreement.

5.4 INDEMNIFICATION BY SELLER. Seller agrees to indemnify and hold
Buyer harmless from and against any Loss incurred by Buyer in connection with or
alleged to result from the following:

(a) a breach by Seller of any representation or warranty made
pursuant to SECTION 5.1 above or otherwise in this Agreement;

(b) a breach by Seller of any of its other obligations or
covenants contained in this Agreement;

5.5 INDEMNIFICATION BY BUYER. Buyer agrees to indemnify, defend and
hold Seller harmless from and against any Loss incurred by Seller in connection
with or alleged to result from the following:

(a) a breach by Buyer of any representation or warranty made
pursuant to SECTION 5.2 above or otherwise in this Agreement;

(b) a breach by Buyer of any of its obligations or covenants
contained in this Agreement;

(d) any liability arising from the actions of the Transition
Employees while under the supervision or control of Buyer.

5.6 LIMITS ON INDEMNIFICATION. In order to limit certain transaction
expenses, the parties acknowledge and agree that neither party may seek
indemnification under this Article 5 unless the aggregate claims exceed
$10,000 and that no claim by either party may exceed $2,000,000. This
limitation on indemnification shall not apply to any loss incurred by Buyer
as a result of Seller's failure to perform or discharge any Retained
Liabilities.

5.7 PROCEDURE FOR INDEMNIFICATION. The party that is entitled to be
indemnified hereunder shall follow the procedures set forth in EXHIBIT D.

ARTICLE 6
ADDITIONAL AGREEMENTS

<PAGE>

6.1 TERMINATION. This Agreement may be terminated at any time prior to
the Closing:

(a) by mutual written consent of Buyer and Seller;

(b) by either Buyer or Seller if the other party breaches any
of its material representations, warranties, or covenants contained in this
Agreement and, if the breach is curable, the breach is not cured within five (5)
business days after notice; or

(c) by either Buyer or Seller if the Closing does not occur
within five business days of the date Seller obtains any and all consents
required to consummate the transaction contemplated herein, but in any event
no later than January 15, 2000 (except that no party shall have the right to
terminate this Agreement unilaterally if the event giving rise to the
non-occurrence of the Closing is primarily attributable to that party or to
any affiliated party).

6.2 EFFECT OF TERMINATION. If this Agreement is terminated as provided
above, this Agreement will become void and none of the parties or their
Representatives will have any further liability or obligation except as set
forth in SECTION 3.5 of this Agreement, and except for liability arising from a
breach of this Agreement.

6.3 TRANSACTION EXPENSES. Except as expressly provided herein, each
party shall bear its own expenses, including without limitation, all fees of
counsel, consultants, and accountants incident to this Agreement.

6.4 NOTICES. All notices, and other communications hereunder will be in
writing and deemed to have been given when (i) delivered by hand, (ii) sent by
telecopier (with receipt confirmed), provided that a copy is mailed by
registered mail, postage pre-paid return receipt requested, or (iii) when
actually received by the addressee, in each case to the following:

If to Seller: Cragar Industries, Inc.
4636 North 43rd Avenue
Phoenix, Arizona 85031
Phone: (623) 247-1300, ex. 508
FAX: (623) 846-0684
Attn: Michael Hartzmark

With a copy to: Snell & Wilmer L.L.P.
One Arizona Center
Phoenix, Arizona 85004-0001
Phone: (602) 382-6363
FAX: (602) 382-6070

<PAGE>

Attn: Richard Stagg, Esq.

If to Buyer : Carlisle Tire & Wheel
23 Windham Blvd.
Aiken, SC 29805
Phone: 803-643-2900
FAX: 803-643-2919
Attn: President

With a copy to: Carlisle Companies Incorporated
250 S. Clinton St., Suite 201
Syracuse, NY 13202
Phone: 315-474-2500
FAX: 315-474-2008
Attn: Vice-President,
Secretary & General Counsel

6.6 ARBITRATION. Any controversy relating to this Agreement or relating
to the breach hereof shall be settled by arbitration conducted in Phoenix,
Arizona in accordance with the Commercial Arbitration Rules of the American
Arbitration Association then in effect. The award rendered by the arbitrator(s)
shall be final and judgment upon the award rendered by the arbitrator(s) may be
entered upon it in any court having jurisdiction thereof. The arbitrator(s)
shall possess the powers to issue mandatory orders and restraining orders in
connection with such arbitration. The expenses of the arbitration shall be borne
by the losing party unless otherwise allocated by the arbitrator(s). The
agreement to arbitrate shall be specifically enforceable under the prevailing
arbitration law. During the continuance of any arbitration proceedings, the
parties shall continue to perform their respective obligations under this
Agreement. Nothing herein shall preclude the Seller or any affiliate or
successor from seeking equitable relief, including injunction or specific
performance, in any court having jurisdiction, in connection with the
non-compete agreement.

<PAGE>

writing approved by Buyer and Seller. If any term, provision, covenant, or
restriction of this Agreement is held by a court to be invalid or unenforceable,
the remainder of the terms, provisions, covenants, and restrictions of this
Agreement will remain in full force and effect and will in no way be affected or
invalidated and the court will modify this Agreement or, in the absence thereof,
the parties agree to negotiate in good faith to modify this Agreement to
preserve each party's anticipated benefits under this Agreement.

6.9 WAIVER OF PROVISIONS. The terms, covenants, representations,
warranties, and conditions of this Agreement may be waived only by a written
instrument executed by the party waiving compliance. The failure of any party at
any time to require performance of any provisions hereof will, in no manner,
affect the right at a later date to enforce the same. No waiver by any party of
any condition, or breach of any provision, term, covenant, representation, or
warranty contained in this Agreement, whether by conduct or otherwise, in any
one or more instances, will be deemed to be or construed as a further or
continuing waiver of any such condition or of the breach of any other provision,
term, covenant, representation, or warranty of this Agreement.

<PAGE>

Buyer and Seller have executed this Agreement on the date first written
above. By signing below, each individual represents that he or she is a duly
elected officer of the company and is authorized to sign in that capacity.

CRAGAR INDUSTRIES, INC., a Delaware corporation

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

CARLISLE TIRE & WHEEL CO.
a Delaware corporation

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

<PAGE>

Schedule 1
Inventory-as of October 15, 1999
[*]

[*] Redacted Information.

<PAGE>

Schedule 2
Equipment-as of February 19, 1999
[*]

[*] Redacted Information.

<PAGE>

Schedule 3
Equipment-Supplemental List
[*]

[*] Redacted Information.

<PAGE>

Schedule 4
Customer Orders
[*]

[*] Redacted Information

<PAGE>

Schedule 5
Vendors Orders
[*]

[*] Redacted Information

<PAGE>

Schedule 6
Contracts-
NONE

<PAGE>

Schedule 7
Product Warranties
[*]

[*] Redacted Information

<PAGE>

EXHIBIT A

DEFINITIONS

1. Definitions. For purposes of this Agreement, the following
terms have the following meanings.

"ACCOUNTS RECEIVABLE" means all selected accounts and notes receivable
of Seller related to the SOR Wheel Business as of the Closing Date which are
Current Receivables (i.e., bona fide accounts receivable resulting from sales
and shipments of SOR Wheel Business products to credit worthy customers of
Seller within sixty days immediately preceding the Closing Date and are not
heavily concentrated accounts or contra accounts which are deemed unacceptable
by Bank of America Commercial Funding Commercial Finance), Future Receivables
(i.e. bona fide accounts receivable resulting from sales and shipments of SOR
Wheel Business products to customers of Seller within ninety days immediately
preceding the Closing Date in which Seller agreed at the time of sales that the
customer need not pay for the products for up to ninety days following the
sale), or other bona fide accounts receivable.

"APPLICABLE LAWS" means all laws and regulations of foreign, federal,
state, and local governments and all agencies regulating or otherwise affecting
the SOR Wheel Business or the Acquired Assets, including, without limitation,
employee health and safety, the discharge of pollutants or wastes, and employee
benefit plans.

"CONTRACT" means any (i) agreement or indenture relating to the
borrowing of money in excess of $5,000 relating to the SOR Wheel Business or
Acquired Assets or to mortgaging, pledging, or otherwise placing a lien on
any of the Acquired Assets; (ii) guaranty of any obligation for borrowed
money secured by lien on Acquired Assets, other than endorsements made for
collection; (iii) lease or agreement under which it is lessor or lessee of,
or permits any third party to hold or operate, any Acquired Assets; or (iv)
other agreement material to the SOR Wheel Business.

"GAAP" means generally accepted United States accounting principles,
applied on a basis consistent with the basis on which the Balance Sheet and the
other financial statements were prepared.

"HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976 or any successor law, and regulations and rules issued pursuant to that Act
or any successor law.

"INDEMNIFIED PARTY" means the party which is entitled to be indemnified
under this Agreement.

"INDEMNIFYING PARTY" means the party required to indemnify under this
Agreement.

A-1

<PAGE>

EXHIBIT A

"INSIDERS" means an officer, director, or shareholder of Seller or
Buyer, as the case may be, or any member of the immediate family of any such
officer, director, or shareholder, or any entity in which any of such persons
owns any beneficial interest, other than a publicly held corporation whose stock
is traded on a national securities exchange or in the over-the-counter market
and less than 1% of the stock of which is beneficially owned by any of such
shareholders.

"LOSS" mean all costs, expenses, losses, damages, fines, penalties,
liabilities, lost profits or other losses (including, without limitation,
interest which may be imposed in connection therewith, court costs, litigation
expenses, and reasonable attorneys' and accounting fees).

"REPRESENTATIVE" means any officer, director, principal, attorney,
agent, employee or other representative.

"SUBSIDIARY" means any corporation of which securities having a
majority of the ordinary voting power in electing directors are owned by Seller,
or Buyer, as the case may be, directly or through another Subsidiary.

"TAX" means any federal, state, local, foreign or other tax, levy,
impost, fee, assessment or other government charge, including without limitation
(i) income, estimated income, business, occupation, franchise, property,
payroll, personal property, sales, transfer, use, employment, commercial rent,
occupancy, franchise or withholding taxes, and (ii) any premium, interest,
penalties and additions in connection therewith.

A-2

<PAGE>

EXHIBIT B

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Buyer as follows:

1. ORGANIZATION AND QUALIFICATION. Seller is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware, and has the requisite corporate power and authority to own and operate
its properties and to carry on its business as now conducted. Seller is duly
qualified to do business and is in good standing in the states of Arizona and
Delaware, the only jurisdictions where the failure to be so qualified would have
a material adverse effect on its business, properties, or ability to conduct the
business currently conducted by it.

2. AUTHORITY RELATIVE TO THIS AGREEMENT. Seller has the requisite
corporate power and authority to enter into this Agreement and to carry out its
obligations hereunder. The execution and delivery of this Agreement by Seller
and the consummation by Seller of these transactions has been duly authorized by
the Board of Directors of Seller. This Agreement has been duly executed and
delivered by Seller, and constitutes a valid and binding obligation of Seller,
enforceable in accordance with its terms.

3. NO CONFLICTS. Except as set forth in the Disclosure Letter, the
Seller is not subject to, or obligated under, any provision of (a) its Articles
of Incorporation, Bylaws, or other organizational documents, (b) any agreement,
arrangement, or understanding, (c) any license, franchise, or permit, or (d) any
Applicable Law which would be breached or violated, or in respect of which a
right of termination or acceleration would arise, or pursuant to which any
encumbrance on any of its assets would be created, by its execution, delivery,
and performance of this Agreement and the consummation by it of the transactions
contemplated hereby.

4. NO CONSENTS. Except for the consent of the Board of Directors, the
holders of Seller's common and preferred stock, Junior Secured Lenders and Bank
of America Commercial Funding Commercial Finance, no authorization, consent, or
approval of, or filing with, any public body, court, or authority is necessary
on the part of Seller for the consummation by Seller of the transactions
contemplated by this Agreement.

5. FINANCIAL STATEMENTS. Seller has provided to Buyer for the 1997 and
1998 year-end audited financial statements in the form of Seller's 10-KSB
Reports and the Seller's most recent financial statements in the form of
Seller's 10-QSB Report. All of these financial statements have been prepared in
accordance with GAAP applied on a consistent basis throughout the periods
involved and fairly present the financial position of Seller as of the dates
thereof and the results of its operations and cash flows for the periods then
ended.

6. SELLER'S SEC REPORTING. Seller files periodic reports pursuant to
the Securities Exchange Act of 1934 (the "SEC REPORTS"). Since December 1997,
Seller has

B-1

<PAGE>

EXHIBIT B

duly filed all SEC Reports required to be filed, and no such report, as of the
date filed, contained any untrue statement of material fact or omitted to state
any material fact required to be stated therein or necessary to make the
statements in such report, in light of the circumstances under which they were
made, not misleading. The financial statements included in such SEC Reports were
prepared in accordance with generally accepted accounting principles applied on
a consistent basis throughout the periods involved and present fairly the
consolidated financial position, results of operation, and cash flows of Seller
and its consolidated subsidiaries as of the dates and for the periods indicated,
subject, in the case of unaudited interim statements, to normal year-end
adjustments and the absence of complete footnote disclosure.

7. COMPLIANCE WITH LAWS. Seller and its officers, directors, agents,
and employees have complied in all material respects with all Applicable Laws
related to the SOR Wheel Business and Acquired Assets, and no claims have been
filed against Seller alleging a material violation of any such Applicable Law,
except as set forth in the Disclosure Letter.

8. LITIGATION. Except as set forth in the Disclosure Letter, there are
no suits, claims, actions, arbitrations, investigations, or proceedings entered
against, now pending, or threatened against Seller before any court,
arbitration, administrative or regulatory body, or any governmental agency which
may result in any judgment, order, award, decree, liability, or other
determination which will or could reasonably be expected to have any material
adverse effect upon Seller's ability to fulfill its obligations under this
Agreement and the License Agreement,, the Acquired Assets, or the SOR Wheel
Business. Seller is not subject to any continuing court or administrative order,
writ, injunction, or decree applicable to it or the SOR Wheel Business, or to
its property or employees, and Seller is not in material default with respect to
any order, writ, injunction, or decree of any court or federal, state,
municipal, or other governmental department, commission, board, agency, or
instrumentality which will or could reasonably be expected to have any effect
upon Seller, the Acquired Assets, or the SOR Wheel Business.

9. GOOD TITLE TO AND CONDITION OF THE ACQUIRED ASSETS.

a. The Inventory listed on SCHEDULE 1 is carried on Seller's
books and records at a value determined in accordance with GAAP.

b. Seller owns the Acquired Assets free and clear of all
liens, encumbrances and security interests, except as disclosed in the
Disclosure Letter, or leases such equipment under valid leases, all of
which are listed in the Disclosure Letter. Seller is not in default
under any such obligations, and no circumstances exist which could
result in such default, under any of such equipment leases, nor to
Seller's knowledge is any other party to any of such equipment leases
in default.

10. OTHER CONTRACTS AND COMMITMENTS.

B-2

<PAGE>

EXHIBIT B

a. Seller has furnished Buyer with a true and correct copy of
each written Contract, and a written description of each oral Contract
referred to in the Disclosure Letter, together with all amendments,
waivers, or other changes thereto.

b. Except as specifically disclosed in the Disclosure Letter:
(i) no supplier has indicated that it will stop or decrease the rate of
business done with Seller, except for changes in the ordinary course of
the SOR Wheel Business; (ii) Seller has performed in all material
respects the obligations required to be performed by it in connection
with the Contracts and Seller has not been advised of or received any
claim of default under any Contract required to be disclosed hereunder;
(iii) Seller has no present expectation or intention of not fully
performing any obligation pursuant to any Contract; and (iv) to
Seller's knowledge there has been no breach and there is no anticipated
breach by any other party to any Contract.

11. SOLVENCY; BULK SALES. Seller is solvent and able to pay its
outstanding debts as they mature. Seller will not be rendered insolvent by the
transfer of the Acquired Assets pursuant to this Agreement, and the transfer of
the Acquired Assets is not fraudulent to any creditor or equity interest holder
of Seller. There is no state bulk sales or bulk transfer law applicable to the
sale of the Acquired Assets to Buyer.

12. TAX MATTERS. Seller has filed all federal, foreign, state, county,
and local income, excise, property, sales, employment-related wages and
benefits, and other tax returns which are required to be filed by it or them, as
the case may be, in respect of Seller, the SOR Wheel Business or the Acquired
Assets, and all such returns are true and correct; all taxes due and payable by
Seller in respect of Seller, the SOR Wheel Business or the Acquired Assets have
been paid; Seller's provisions for taxes on the most recent balance sheet and
any other financial statements delivered hereunder are sufficient for all
accrued and unpaid taxes as of the dates of such balance sheets; Seller has paid
all taxes due and payable by it or which it is obligated to withhold from
amounts owing to any employee, creditor, or third party; Seller has not waived
any statute of limitations in respect of taxes or agreed to any extension of
time with respect to a tax assessment or deficiency; the assessment of any
additional taxes relating to or for periods for which returns have been filed is
not expected; and Seller has not received notice of any unresolved questions or
claims concerning its tax liability.

13. BROKERS' FEES. Seller has not dealt with any broker, finder, or
other person entitled to any brokerage commissions, finders' fees, or similar
compensation in connection with the transactions contemplated by this Agreement.

14. PRODUCT WARRANTIES. Schedule 7 to this Agreement contains a
description of all product warranties relating to products sold by Seller in the
SOR Wheel Business, including the length of each warranty, the obligation of
Seller thereunder and a three-year

B-3

<PAGE>

EXHIBIT B

history of warranty claims made against Seller with respect to the SOR Wheel
Business. Except as set forth on Schedule 7 to this Agreement, Seller has made
no express warranties with respect to SOR products sold or distributed by Seller
and no warranties have been made by Seller or authorized personnel of Seller.
Except as disclosed in the Disclosure Letter, no SOR Products sold or
manufactured by Seller in the SOR Wheel Business have at any time been subject
to any voluntary or governmental recall (whether federal, state, local or
foreign), and Seller knows of no presently existing circumstances that would
constitute a valid basis therefor.

15. NO OTHER AGREEMENT TO SELL THE ASSETS OR BUSINESS. Seller has no
legal obligation, absolute or contingent, to any other person or firm to sell
the Acquired Assets or SOR Wheel Business (other than the sale of inventory in
the ordinary course of business), or to effect any merger, consolidation or
other reorganization, directly or indirectly, of Seller or to enter into any
agreement with respect thereto.

16. Disclosure. Seller has not withheld from Buyer any material facts
relating to the Acquired Assets or the SOR Wheel Business, financial condition
or prospects of the SOR Wheel Business. No representation or warranty of Seller
in the Agreement or in any letter, certificate, schedule, statement or other
document furnished or to be furnished pursuant to this Agreement or in
connection with the transaction contemplated by this Agreement contains or will
omit to state any material fact required to be stated herein or therein or
necessary to make the statements herein therein not misleading.

B-4

<PAGE>

EXHIBIT C

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to Seller each of the following:

1. ORGANIZATION AND QUALIFICATION. Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware, and has the requisite corporate power and authority to own and operate
its properties and to carry on its business as now conducted in every
jurisdiction where the failure to do so would have a material adverse effect on
its business, properties, or ability to conduct the business currently conducted
by it.

2. AUTHORITY RELATIVE TO THIS AGREEMENT. Buyer has the requisite
corporate power and authority to enter into this Agreement and to carry out its
obligations hereunder. The execution and delivery of this Agreement by Buyer and
the consummation by Buyer of the transactions contemplated hereby have been duly
authorized by Buyer, and no other corporate proceedings on the part of Buyer are
necessary to authorize this Agreement and such transactions. This Agreement has
been duly executed and delivered by Buyer and constitutes a valid and binding
obligation of Buyer, enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
or other similar laws relating to the enforcement of creditors' rights generally
and by general principles of equity.

3. NO CONFLICTS. Buyer is not subject to, or obligated under, any
provision of (a) its Certificate of Incorporation or Bylaws, (b) any material
agreement, arrangement, or understanding, (c) any material license, franchise,
or permit, or (d) any law, regulation, order, judgment, or decree, which would
be breached or violated, or in respect of which a right of termination or
acceleration would arise, or pursuant to which any encumbrance on any of its or
any of its subsidiaries' material assets would be created, by its execution,
delivery, and performance of this Agreement and the consummation by it of the
transactions contemplated hereby.

4. NO CONSENTS. Except with respect to filing under the HSR Act, no
authorization, consent, or approval of, or filing with, any public body, court,
or authority is necessary on the part of Buyer for the consummation by Buyer of
the transactions contemplated by this Agreement.

5. COMPLIANCE WITH LAWS. Buyer and its officers, directors, agents, and
employees have complied in all material respects with all Applicable Laws
related to Buyer's business, and no claims have been filed against Buyer
alleging a material violation of any Applicable Law, except as set forth in the
Disclosure Letter.

6. LITIGATION. Except as set forth in the Disclosure Letter, there are
no suits, claims, actions, arbitrations, investigations, or proceedings entered
against, now pending, or threatened against Buyer before any court, arbitration,
administrative or regulatory body, or any governmental agency which may result
in any judgment, order, award, decree, liability, or other determination which
will or could reasonably be expected to

C-1

<PAGE>

EXHIBIT C

have any material adverse effect upon Buyer's ability to fulfill its obligations
under this Agreement or the License Agreement, the Acquired Assets, or the SOR
Wheel Business. Buyer is not subject to any continuing court or administrative
order, writ, injunction, or decree applicable to it or the SOR Wheel Business,
or to its property or employees, and Buyer is not in material default with
respect to any order, writ, injunction, or decree of any court or federal,
state, municipal, or other governmental department, commission, board, agency,
or instrumentality.

8. NO RESTRICTIONS ON BUSINESS ACTIVITIES. There is no agreement
(noncompete or otherwise), commitment, judgment, injunction, order, or decree to
which Buyer is a party or otherwise binding on Buyer or its property which has
or reasonably could be expected to have the effect of prohibiting or impairing
any business practice of Buyer, any acquisition of property (tangible or
intangible) by Buyer, or the conduct of the SOR Wheel Business.

9. DISCLOSURE.` There is no fact which has not been disclosed to Seller
which materially adversely affects or could reasonably be anticipated to
materially adversely affect the Buyer's ability to fulfill its obligations under
this Agreement. No representation or warranty of Buyer in the Agreement or in
any letter, certificate, schedule, statement or other document furnished or to
be furnished pursuant to this Agreement or in connection with the transaction
contemplated by this Agreement contains or will omit to state any material fact
required to be stated herein or therein or necessary to make the statements
herein therein not misleading

C-2

<PAGE>

EXHIBIT D

PROCEDURE FOR INDEMNIFICATION

1. The Indemnified Party will promptly give notice hereunder to the
Indemnifying Party after obtaining written notice of any claim as to which
recovery may be sought against the Indemnifying Party.

2. If the indemnity claim arises from the claim of a third party, the
Indemnified Party will permit the Indemnifying Party to assume the defense of
any such claim and any litigation resulting from such claim. If the Indemnifying
Party assumes the defense of a third-party claim, the obligations of the
Indemnifying Party as to such claim will include taking all steps necessary in
the defense or settlement of such claim or litigation and holding the
Indemnified Party harmless from and against any and all damages caused by or
arising out of any settlement approved by the Indemnifying Party or any judgment
in connection with such claim or litigation. The Indemnifying Party shall not,
in the defense of such claim or any litigation resulting therefrom, consent to
entry of any judgment (other than a judgment of dismissal on the merits without
costs) except with the written consent of the Indemnified Party, or enter into
any settlement (except with the written consent of the Indemnified Party) which
does not include as an unconditional term thereof the giving by the claimant or
the plaintiff to the Indemnified Party a release from all liability in respect
of such claim or litigation. The Indemnified Party may, with counsel of its
choice and at its expense, participate in the defense of any such claim or
litigation.

3. If the Indemnifying Party does not assume the defense of any such
claim by a third-party or resulting litigation after receipt of notice from the
Indemnified Party, the Indemnified Party may defend against such claim or
litigation in such manner as it deems appropriate, and unless the Indemnifying
Party deposits with the Indemnified Party a sum equivalent to the total amount
demanded in such claim or litigation plus the Indemnified Party's estimate of
the costs of defending the same, the Indemnified Party may settle such claim or
litigation on such terms as it may deem appropriate and the Indemnifying Party
will promptly reimburse the Indemnified Party for the amount of such settlement
and for all damages incurred by the Indemnified Party in connection with the
defense against or settlement of such claim or litigation. If the Indemnifying
Party fails to notify an Indemnified Party of its election to defend any such
claim or action by a third party within 15 days after the Indemnifying Party
received notice of such claim or action, then the Indemnifying Party will be
deemed to have waived its right to defend such claim or action.

4. The Indemnifying Party will promptly reimburse the Indemnified Party
for the amount of any judgment rendered with respect to any claim by a
third-party in such litigation and for all damage incurred by the Indemnified
Party in connection with the defense against such claim or litigation, whether
or not resulting from or arising out of the act of a third-party.

5. The right to indemnification hereunder will not be affected by any
failure of an Indemnified Party to give such notice, or delay by an Indemnified
Party in giving such notice, unless, and then only to the extent that, the
rights and remedies of the Indemnifying Party will have been prejudiced as a
result of the failure to give, or delay in giving, such notice.

D-1

<PAGE>

EXHIBIT 10.2

EXCLUSIVE FIELD OF USE LICENSE AGREEMENT

This Agreement, and any Exhibits, Schedules, and Appendices
(collectively, the "AGREEMENT"), effective as of ______________, 1999, is
entered into between Cragar Industries, Inc., a Delaware corporation having
its principal place of business at 4636 North 43rd Avenue, Phoenix, Arizona
85031 (hereinafter "LICENSOR"), and Carlisle Tire & Wheel Co., (defined to
include any of subsidiaries, affiliates, partnerships, shareholders, or other
related parties), a Delaware corporation having its principal place of
business at 23 Windham Blvd., Aiken, SC 29805 (hereinafter "LICENSEE").

WHEREAS, Licensor is the owner of the various trademark and/or
servicemark rights listed on the attached SCHEDULE A (hereinafter the
"TRADEMARK RIGHTS");

WHEREAS, Licensor is the owner of the various patent rights listed
on the attached SCHEDULE B (hereinafter the "PATENT RIGHTS");

WHEREAS, Licensee and Licensor have entered into a certain Agreement
of Sale and Purchase of Assets, dated as of October 15, 1999; and

WHEREAS, Licensee desires to obtain an exclusive license, in the
field of use designated herein, under the Trademark Rights, the Patent
Rights, and other intangible rights owned by Licensor.

NOW, THEREFORE, in consideration of the premises, the mutual
covenants contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:

1. DEFINITIONS

1.1. "PATENTED PRODUCT" means any device or system covered by a
claim of any currently issued patent contained in the Patent Rights, or any
patent that issues from a currently pending patent application contained in
the Patent Rights.

1.2. "LICENSED PRODUCTS" means the products listed on the attached
SCHEDULE C, ALL TRADE DRESS RIGHTS EMBODIED THEREIN and any Patented Product.

1.3. "LICENSED FIELD" means vehicle wheels, other than motorcycle
wheels, having either pierced or non-pierced steel outer rims, and related
accessories.

1.4. "IMPROVEMENT" means any modification in the structure or design
of the Licensed Products, whether patentable or unpatentable, which depends
upon a Licensed Product for its use or effectiveness or which increases the
effectiveness or manufacturability of a Licensed Product, including, without
limitation, any modification of a part, component, or process or apparatus
for the manufacture thereof.

1
<PAGE>

1.5. "INTANGIBLE RIGHTS" means (i) any and all documents in whatever
form, including but not limited to writings, computer disks, computer tapes,
and electronic records, containing design and technical information,
engineering or production data, drawings, plans, specifications, techniques,
methods, processes, trade secrets, reports, models, market research data,
customer lists, and any and all other material or matter used by or in
possession of Licensor and applicable to the design, manufacture, assembly,
service, and sale of the Licensed Products, (ii) Licensor's general and
specific knowledge, experience, and information, not in written or printed
form, applicable to the design, manufacture, assembly, service, and sale of
the Licensed Products, and (iii) any other trade secret information, and
proprietary information that may be applicable to the design, manufacture,
assembly, service, and sale of the Licensed Products.

1.6. "LICENSED RIGHTS" means one or more of any of the Trademark
Rights, the Patent Rights, and the Intangible Rights.

2. LICENSE GRANT

2.1. Trademarks. Licensor grants to Licensee a worldwide exclusive
license in the Licensed Field to use the Trademark Rights in connection with
the marketing and sale of the Licensed Products, subject to the terms of this
Agreement.

2.1.1. The parties agree that Licensee's use of the Trademark
Rights, including the goodwill arising from such use, shall inure to
the benefit of Licensor, and Licensee shall have no right whatsoever to
the Trademark Rights except as specifically set forth herein. Licensee
agrees to not use the Trademark Rights, or any simulation or variant
thereof, or any mark, name, logo, design, likeness, or other
representation confusingly similar to any of the marks included in the
Trademark Rights, except as specifically set forth herein.

2.1.2. Licensee shall not at any time do or cause to be done
any act or thing contesting or in any way impairing or tending to
impair any part of Licensor's right, title, and interest respecting the
Trademark Rights. Licensee shall not in any manner represent that it
has any ownership in the Trademark Rights, and Licensee acknowledges
that its use of the Trademark Rights shall not create in Licensee's
favor any right, title, or interest in or to the Trademark Rights.

2.2. LICENSED PRODUCTS. Licensor grants to Licensee a worldwide
exclusive license in the Licensed Field to make, use, sell, import and offer
for sale the Licensed Products, subject to the terms of this Agreement. In
connection with this grant, Licensor grants to Licensee a worldwide exclusive
license in the Licensed Field to use the Patent Rights and the Intangible
Rights to manufacture the Licensed Products.

2.2.1. Licensor makes no warranty related to the validity or
enforceability of any of the issued patents included in the Patent
Rights.

2
<PAGE>

2.2.2 Licensee may only disclose the Intangible Rights to
third parties if such disclosure is necessary for Licensee to perform
its obligations under this Agreement, PROVIDED, that no disclosure of
the Intangible Rights shall be made by Licensee unless Licensee has
obtained from the third party a signed nondisclosure agreement that
affords Licensor at least the same protection as set forth in PARAGRAPH
8 herein.

2.3. No Transfer. The rights granted under this PARAGRAPH 2 may not be
sublicensed or transferred, except to Licensees affiliate (defined as any
parent, subsidiary, subsidiary of a parent, or other entity in which Licensor
owns at least fifty percent of the voting interest therein), without the express
prior written consent of Licensor, which shall not be unreasonably withheld.

3. ROYALTIES AND PAYMENT TERMS

3.1. Licensee shall pay to Licensor the royalty on Net Sales of
Licensed Products as specified in the attached SCHEDULE D. Licensee's obligation
to pay royalties under this Agreement will be triggered by the invoice date or
the shipping date of the Licensed Products, whichever occurs first. Royalty
payments are due thirty (30) days after the end of each calendar quarter.

3.2. Licensee shall keep accurate and complete records containing all
information required for the computation and verification of the payments due
under Paragraph 3.1. Licensee shall keep records for a period of at least three
years. On a quarterly basis and upon five days advance written notice, Licensor
shall have the right to inspect such records during Licensee's ordinary business
hours to verify the accuracy of any royalty payments made under this Agreement.
If an audit by Licensor uncovers a deficiency in any royalty payment exceeding
twenty-five percent (25%) of the payments due under Paragraph 3.1, Licensee must
pay the cost of such audit. If an audit by Licensor uncovers a deficiency in any
royalty payment Licensee must immediately remit the amount due, including a two
percent (2.0%) per month finance charge.

3.3. Any past due royalty payments will carry an interest rate of two
percent (2.0%) per month commencing on the due date and compounding every thirty
(30) days thereafter.

3.4. Within thirty (30) days after the end of each calendar quarter,
Licensee will have paid to Licensor at least the following cumulative royalty
payment amounts:

First Quarter: 20% of the total minimum annual royalty for that year.
Second Quarter: 40% of the total minimum annual royalty for that year.
Third Quarter: 60% of the total minimum annual royalty for that year.
Fourth Quarter: 100% of the total minimum annual royalty for that year.

3
<PAGE>

If any of the above cumulative royalty payment amounts is not met by
Licensee, or if Licensee is late for any quarterly royalty payment, Licensee
will be deemed to have defaulted. Upon written notice of such default,
Licensee shall have ninety (90) days to cure such default, otherwise Licensor
may immediately terminate this Agreement. Termination of this Agreement is
the sole remedy available to Licensor.

4. QUALITY CONTROL

4.1. Licensee shall use the Trademark Rights in connection with the
Licensed Products only upon employing quality standards that meet or exceed
each of the following: (a) the current standards under which such products
have in the past been manufactured by Licensor; and (b) the standards
recognized by the industry as acceptable for such products.

4.2. Licensee agrees that Licensor has the right to control the
quality of all Licensed Products manufactured, sold, and marketed by Licensee
under the Trademark Rights. If Licensor determines, in Licensor's sole
reasonable discretion, that the quality of the Licensed Products fail to meet
the quality control standards set forth herein, then such failure shall
constitute a material breach of this Agreement, permitting Licensor to
terminate this Agreement upon ninety (90) days' written notice to Licensee,
unless such breach is cured.

4.3. Licensee shall permit Licensor or Licensor's appointed agent to
inspect and to monitor Licensee's use of the Trademark Rights including,
without limitation, (a) allowing Licensor or Licensor's appointed agent, at
reasonable times, to review Licensee's advertisements and other materials
using the Trademark Rights, and (b) with reasonable advance notice, to enter
the premises of Licensee, or any premises under the control of Licensee,
where any Licensed Product is manufactured or sold, to inspect the Licensed
Products and the manner in which the Licensed Products are marketed. Licensee
shall also provide, upon request of Licensor, representative samples of the
Licensed Products and any advertising therefor.

4.4. Licensee agrees not to use the Trademark Rights in connection
with any Licensed Products where the character, appearance, quality, or
suitability thereof is disapproved by Licensor. The Licensed Products sold
and manufactured under the Trademark Rights shall be in compliance with all
applicable national, state, and local laws and regulations governing the
Licensed Products.

4.5. LEVERAGING OF THE TRADEMARK RIGHTS

4.5.1. Subject to approval of Licensor and subject to the
quality control standards set forth herein, Licensee may utilize the
Trademark Rights in conjunction with any marks owned or created by
Licensee, but only to the extent that such use of the Trademark Rights
is reasonably intended to promote the Licensed Products, and only to
the extent that such use does not dilute any of the Trademark Rights.

4
<PAGE>

4.5.2. Subject to approval of Licensor and subject to the
quality control standards set forth herein, Licensee shall use the word
mark CRAGAR to create new trademark or service mark designs on behalf
of Licensor (hereinafter "NEW MARKS"). Such New Marks are only to be
used in connection with the sales, promotion, or marketing of the
Licensed Products and such New Marks must be distinctive over all other
New Marks that are created by additional Licensees of Licensor under
similar terms. The parties agree that Licensee's use of such New Marks,
including the goodwill arising from such use, shall inure to the
benefit of Licensor, and Licensee shall have no right whatsoever to the
New Marks except as specifically set forth herein. Licensee agrees to
not use the New Marks, or any simulation or variant thereof, or any
mark, name, logo, design, likeness, or other representation confusingly
similar to any of the New Marks, except as specifically set forth
herein.

4.5.3 Licensee agrees to use the New Marks whenever the Cragar
name or logo is used.

4.5.4. Licensee's right to use the Trademark Rights, any marks
derived from or including any of the Trademark Rights, and any New
Marks, as contemplated by this PARAGRAPH 4.5, shall immediately cease
upon termination of this Agreement for any reason.

5. MARKINGS

5.1. [Intentionally Left Blank]

5.2. Licensee shall place the trademark registration symbol "-R-"
immediately following each use of a federally registered trademark included in
the Trademark Rights. Licensee shall place the trademark symbol "TM" immediately
following each use of a non-federally-registered trademark included in the
Trademark Rights.

5.3. Licensee shall mark each Licensed Product it manufactures with the
actual manufacturing date of such Licensed Product, along with any other
government-mandated, statutory, or other regulatory markings that may be
required. Licensee shall be fully responsible for, and agrees to indemnify
Licensor for, any and all product liability and product warranty claims (and any
associated costs and damages) caused by Licensee's failure to properly mark the
Licensed Products under this Paragraph 5.3.

6. IMPROVEMENTS

6.1. If Licensee develops an Improvement, Licensee shall immediately
disclose such Improvements to Licensor prior to incorporation or implementation
of such Improvement into any Licensed Product. Licensee shall obtain written
approval from Licensor, which shall not be unreasonably denied by Licensor,
before any such Improvement is incorporated or implemented into any Licensed
Product.

5
<PAGE>

6.2. Upon termination of this Agreement, Licensee shall grant to
Licensor a non-exclusive and royalty-free license to make, use, sell, offer
for sale, and import products that embody or utilize any Improvement
developed by Licensor.

6.3. Licensor shall retain all rights in and to any Improvement
developed or acquired by Licensor. Licensor agrees to grant to Licensee
licenses of the scope specified in Paragraph 2 herein for any Improvements
developed by Licensor, and the terms of this Agreement shall also apply to
such Improvements. No additional royalty shall be due for such additional
licenses for such Improvements. Licensee agrees to cooperate with Licensor,
without further consideration, during the preparation and prosecution of any
patent applications filed in connection with Improvements developed by
Licensor.

7. BEST EFFORTS

7.1. Licensee shall use its best efforts to promote the sale of the
Licensed Products, including making commercially reasonable advertising and
marketing expenditures, prospecting and contacting customers and potential
customers of the Licensed Products, and striving to achieve a cost-efficient
manufacturing process while maintaining a high quality of Licensed Products.

7.2. Licensor may request Licensee to prepare a written quarterly
summary of promotional, marketing, and sales activity related to the Licensed
Products.

7.3. If, for any reason, Licensee ceases to actively market and
promote the Licensed Products for any continuous ninety (90) day period,
Licensee shall promptly notify Licensor and Licensor shall have the right to
immediately terminate this Agreement.

8. CONFIDENTIALITY

8.1. During the term of this Agreement, one party (the "DISCLOSING
PARTY") may disclose to another party (the "RECEIVING PARTY") confidential
information, proprietary information, trade secret information, marketing data,
and the like (hereinafter "CONFIDENTIAL INFORMATION"). The Receiving Party shall
not use or disclose any Confidential Information, except for the purpose of
complying with its obligations under this Agreement.

8.2. The Receiving Party agrees to keep all Confidential Information
strictly confidential, subject to the limited disclosure to a selected number of
employees as may be reasonably necessary to enable the Receiving Party to comply
with its obligations under this Agreement.

8.3. Upon termination of this Agreement, the Receiving Party shall
return (or destroy if requested by the Disclosing Party) all Confidential
Information in its

6
<PAGE>

possession. Notwithstanding the foregoing, the confidentiality provisions set
forth herein shall survive any termination of this Agreement.

9. INFRINGEMENT

9.1. If either party discovers an infringing use of any of the
Licensed Rights by any third party, the discovering party shall promptly
notify the other party. If Licensor elects to institute an action to end such
third party infringement, Licensee shall provide all reasonable assistance to
Licensor in connection with such action. If Licensor elects to not institute
such an action, Licensee may initiate such action, and Licensor agrees to
provide reasonable assistance to Licensee in connection with such action.

9.2 Any lawsuit or action initiated pursuant to Paragraph 9.1 shall
be prosecuted at the sole expense of the party bringing suit and all sums
recovered shall be divided equally between the parties after deduction of all
reasonable expenses and attorney fees.

10. TERM AND TERMINATION

10.1. This Agreement shall have a term of ten (10) years from its
effective date, with perpetual renewal rights. Any renewal of this Agreement
shall have a term of ten (10) years.

10.2. At least three hundred sixty (360) days prior to the termination
date of the original Agreement or any subsequently renewed Agreement, Licensee
shall provide written notice to Licensor of Licensee's intent to terminate or
renew the current Agreement.

10.3. If Licensee fails to comply with any of the material terms of
this Agreement, then Licensee will be deemed to have defaulted. Upon written
notice of such default, unless otherwise specified herein, Licensee shall have
ninety (90) days to cure such default, otherwise Licensor may immediately
terminate this Agreement.

10.4. In the event of failure, receivership, or seizure of Licensee,
this Agreement shall terminate immediately.

10.5. If this Agreement is terminated for any reason, Licensee shall
not be relieved of any duties or obligations owing as of the date of
termination, including without limitation, accounting for any outstanding
royalties, responsibility for product warranties and product liability for any
Licensed Products, and the duty to maintain confidentiality in accordance with
Paragraph 8 herein. Any royalty payments due upon termination of this Agreement
must be paid by Licensee within sixty (60) days of the termination date.

10.6. Upon termination of this Agreement for any reason, Licensee shall
immediately cease and desist from any use whatsoever of the Licensed Rights.
Licensee,

7
<PAGE>

its primary lender or another party responsible for liquidating the
Licensee's inventory may, however, liquidate all remaining inventory in its
possession at time of termination, provided that (i) Licensor shall be given
the right of first refusal to purchase any or all of the inventory upon the
same terms as Licensee offers to third parties, (ii) royalties shall be
payable to Licensor on all liquidated inventory. Further, upon termination of
this Agreement for any reason, Licensee shall immediately transfer to
Licensor or destroy, at Licensor's election, any and all documents and things
bearing any mark included within the Trademark Rights.

11. ARBITRATION

Any controversy or claim arising out of or relating to this Agreement,
or its breach, shall be settled by binding arbitration in accordance with the
rules of the American Arbitration Association with all proceedings conducted in
Phoenix, Arizona. Judgement upon the award rendered by the arbitrator(s) may be
entered in any court having competent jurisdiction.

12. MISCELLANEOUS TERMS

12.1. Licensor may assign its rights under this Agreement to any third
party, with prior written consent of Licensee, which shall not be unreasonably
withheld.

12.2. Licensee agrees to indemnify and hold Licensor and its officers,
directors, representatives, agents, and employees harmless from and against any
and all liability, damage, loss, or expense, which Licensor may sustain or incur
in any action brought or claim made by any person, organization, or governmental
entity or agency (including Licensee), to the extent such liability relates to
acts or omissions of acts by Licensee with respect to making, using, selling,
importing and offering for sale the Licensed Products, following the Closing
Date.

12.3. EXCEPT AS EXPRESSLY SET FORTH HEREIN, LICENSOR, AND ANY RELATED
ENTITIES INCLUDING LICENSOR'S DIRECTORS, OFFICERS, EMPLOYEES, AND AFFILIATES
MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESSED
OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, VALIDITY OF ISSUED OR PENDING PATENT CLAIMS, IN THE
ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE. NOTHING IN THIS
AGREEMENT SHALL BE CONSTRUED AS A REPRESENTATION MADE OR WARRANTY GIVEN BY
LICENSOR THAT THE PRACTICE BY LICENSEE OF THE LICENSES GRANTED HEREUNDER SHALL
NOT INFRINGE THE PATENT OR TRADEMARK RIGHTS OF ANY THIRD PARTY. IN NO EVENT
SHALL LICENSOR, ITS DIRECTORS, OFFICERS, EMPLOYEES, OR AFFILIATES BE LIABLE FOR
INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGE OR
INJURY TO PROPERTY OR LOST PROFITS, REGARDLESS OF

8
<PAGE>

WHETHER LICENSOR SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT
SHALL KNOW OF THE POSSIBILITY.

12.4. Subject to PARAGRAPH 2.3 herein, this Agreement shall be
binding upon the successors, assigns, and legal representatives of the
parties.

12.5. Any payment, notice, or other communication required or
permitted to be made or given to either party pursuant to this Agreement
shall be sufficiently made or given upon actual receipt if hand-delivered or
by telecopy, or three days after the date of mailing if sent by certified or
registered mail, postage prepaid, addressed to such party at its address set
forth above or to any other address as it shall designate by written notice
to the other party.

12.6. The parties agree that if any part, term, or provision of this
Agreement is found to be illegal, invalid, or unenforceable, the validity of
the remaining provisions shall not be affected thereby.

12.7. This Agreement shall be governed by, construed, and
interpreted in accordance with the laws of the State of Arizona, without
regard to its conflict of laws rules.

12.8. The failure of any party to exercise any right, power, or
remedy hereunder shall not constitute a waiver thereof, nor shall any single
or partial exercise of any right, power, or remedy hereunder preclude any
other or further exercise thereof or the exercise of any other right, power,
or remedy.

12.9. This Agreement constitutes the entire understanding between
the parties as to the subject matter hereof. No amendments to this Agreement
shall be effective unless in writing and signed by the parties.

12.10 Licensor represents and warrants to Licensee that Licensor has
good and marketable title to and owns or exclusively holds all rights to use,
free and clear of all liens, claims, restrictions and infringements, other
than those disclosed to Licensee, the Licensed Rights. To the best of the
Licensor's knowledge there is no current infringement or other adverse claim
pending against any of the Licensed Rights. Licensor has received no notice
or has any knowledge that Licensor is currently infringing upon the right or
claim right of any person under or with respect to any of the Licensed Rights.

9
<PAGE>

LICENSOR: CRAGAR INDUSTRIES, INC.
a Delaware corporation

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

LICENSEE: CARLISLE TIRE & WHEEL CO.
a Delaware corporation

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

10
<PAGE>

SCHEDULE A - LICENSOR'S TRADEMARK RIGHTS

THIS SCHEDULE A ACCOMPANIES THE EXCLUSIVE FIELD OF USE LICENSE
AGREEMENT, EFFECTIVE __________________________, BETWEEN CRAGAR INDUSTRIES,
INC. ("LICENSOR") AND CARLISLE TIRE & WHEEL CO. ("LICENSEE"). THE PARTIES
AGREE THAT THIS SCHEDULE A MAY NOT BE AMENDED UNLESS SUCH AMENDMENT IS IN
WRITING AND IS SIGNED BY BOTH PARTIES.

A LIST ALL APPLICABLE STATE, FEDERAL, AND FOREIGN REGISTERED TRADEMARKS AND
SERVICE MARKS, INCLUDING THE REGISTRATION NUMBERS AND APPROPRIATE EXHIBITS
SHOWING DESIGN MARKS ARE ATTACHED.

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------
SCHEDULE A
- ------------------------------------------------------------------------------
TRADEMARK NUMBER TRADEMARK DESCRIPTION
- ------------------------------------------------------------------------------
<S> <C>
1478604 Trademark - Cragar America's Choice & design
- ------------------------------------------------------------------------------
819800 Trademark - Cragar
- ------------------------------------------------------------------------------
964061 Trademark - Super Trick
- ------------------------------------------------------------------------------
70444 Trademark - S/S (State of California)
- ------------------------------------------------------------------------------
1031812 Trademark - S/S
- ------------------------------------------------------------------------------
252027 Trademark - CRAGAR in Class 19 Mexican
- ------------------------------------------------------------------------------
354546 Trademark - CRAGAR Mexican
- ------------------------------------------------------------------------------
1870609 Trademark - CRAGAR Japanese
- ------------------------------------------------------------------------------
297264 Trademark - S/S CRAGAR Taiwanese
- ------------------------------------------------------------------------------
297263 Trademark - CRAGAR Taiwanese
- ------------------------------------------------------------------------------
295028 Trademark - CRAGAR Taiwanese
- ------------------------------------------------------------------------------
A233367 Trademark - CRAGAR Australia
- ------------------------------------------------------------------------------
A299886 Trademark - CRAGAR Australia
- ------------------------------------------------------------------------------
161878 Trademark - CRAGAR Canadian
- ------------------------------------------------------------------------------
DMS 16273-000532903 Trademark - European Commercial
- ------------------------------------------------------------------------------

- ------------------------------------------------------------------------------
</TABLE>

<PAGE>

SCHEDULE B - LICENSOR'S PATENT RIGHTS

THIS SCHEDULE B ACCOMPANIES THE EXCLUSIVE FIELD OF USE LICENSE
AGREEMENT, EFFECTIVE ____________________________, BETWEEN CRAGAR INDUSTRIES,
INC. ("LICENSOR") AND CARLISLE TIRE & WHEEL CO. ("LICENSEE"). THE PARTIES AGREE
THAT THIS SCHEDULE B MAY NOT BE AMENDED UNLESS SUCH AMENDMENT IS IN WRITING AND
IS SIGNED BY BOTH PARTIES.

NONE.

12
<PAGE>

SCHEDULE C - LICENSED PRODUCTS

THIS SCHEDULE C ACCOMPANIES THE EXCLUSIVE FIELD OF USE LICENSE
AGREEMENT, EFFECTIVE ________________________________, BETWEEN CRAGAR
INDUSTRIES, INC. ("LICENSOR") AND CARLISLE TIRE & WHEEL CO. ("LICENSEE"). THE
PARTIES AGREE THAT THIS SCHEDULE C MAY NOT BE AMENDED UNLESS SUCH AMENDMENT IS
IN WRITING AND IS SIGNED BY BOTH PARTIES.

The Licensed Products for the License Agreement shall be as follows:

1. Any wheel having steel or aluminum spokes attached to a
pierced steel outer rim and hub, and related accessories
whether or not marketed, distributed or sold under any of the
Trademark Rights ("Wire Wheels");
2. Any wheel having a non-steel center disk attached to a
non-pierced steel outer rim, and related accessories,
marketed, distributed or sold under any of the Trademark
Rights ("Composite Wheels")
3. Any wheel having a multi-piece center disk attached to a
non-pierced steel outer rim, and related accessories,
marketed, distributed or sold under any of the Trademark
Rights ("Legacy Wheels")
4. Any other wheel within the Licensed Field other than
Licensor's Line, Wire Wheels or Composite Wheels, and related
accessories, marketed, distributed or sold under any of the
Trademark Rights ("Commodity Steel Wheels").
5. Licensor's line of wheels, and related accessories with wheel
series identification numbers contained in the Cragar
Industries, Inc. Warehouse Distributor Workbook dated January
1, 1999 ("Licensor's Line") as set forth below:

1. 08/61 (Legacy S/S) (L);
2. 32 (Keystone Klassic) (L);
3. 54 (SS/T) (L);
4. 103 (Street Pro) (L);
5. 310 (Nomad) (C);
6. 311 (Black Race Wheel) (C);
7. 315 (Nomad II)(C);
8. 316 (Star Spoke) (C);
9. 320 (Quick Trick I) (C);
10. 330 (Super Spoke) (C);
11. 341 (Street Star) (L);
12. 346 (Street Lite) (L);
13. 470/471/477/479 (Star Wire) (L); and
14. T80 (W).
Legacy are denoted with "L"
Commodity Steel Wheels are denoted with "C"
Wire Wheels are denoted with "W"

13
<PAGE>

SCHEDULE D - ROYALTY PAYMENTS

This Schedule D accompanies the Exclusive Field of Use License
Agreement, effective ________________________________, between Cragar
Industries, Inc. ("Licensor") and Carlisle Tire & Wheel Co. ("Licensee"). The
parties agree that this Schedule D may not be amended unless such amendment is
in writing and is signed by both parties.

1. Licensee shall pay to Licensor a royalty of five percent (5.0%) of
the Net Sales for all Licensed Products defined as Legacy or Composite
Wheels, where "Net Sales" means the total gross sales price for all
Legacy and Composite Wheel Licensed Products sold by Licensee less the
total gross sales price for all Legacy and Composite Wheel Licensed
Products returned to Licensee during the relevant time period,
except that the total gross sales price for all returned Legacy and
Composite Wheel Licensed Products shall not be deducted in the case
where the Licensor is wholly responsible for the returned Legacy
and Composite Wheel Licensed Product.

2. Licensee shall pay to Licensor a royalty of three percent (3.0%) of
the Net Sales for all Licensed Products defined as Wire Wheels, where
"Net Sales" means the total gross sales price for all Wire Wheel
Licensed Products sold by Licensee less the total gross sales price
for all Wire Wheel Licensed Products returned to Licensee during the
relevant time period, except that the total gross sales price for
all returned Wire Wheel Licensed Products shall not be deducted in
the case where the Licensor is wholly responsible for the returned
Wire Wheel Licensed Product.

3. Licensee shall pay to Licensor a royalty of two percent (2.0%) of
the Net Sales for all Licensed Products defined as Commodity Steel
Wheels, where "Net Sales" means the total gross sales price for all
Commodity Steel Wheel Licensed Products sold by Licensee less the
total gross sales price for all Commodity Steel Wheel Licensed
Products returned to Licensee during the relevant time period, except
that the total gross sales price for all returned Commodity Steel
Wheel Licensed Products shall not be deducted in the case where the
Licensor is wholly responsible for the returned Commodity Steel
Wheel Licensed Product.

4. During the calendar year, should Net Sales for all Licensed
Products exceed ten million dollars ($10,000,000), for the purpose
of calculating additional royalty payments due, the royalty
percentages in (1), (2) and (3), above, shall be reduced by
twenty-five percent (25%) for all Net Sales above ten million
($10,000,000) dollars and equal to or below fifteen million dollars
($15,000,000) for such calendar year.

5. During the calendar year, should Net Sales for all Licensed
Products exceed fifteen million dollars ($15,000,000), for the
purpose of calculating additional royalty payments due, the royalty
percentages in (1), (2) and (3), above, shall be reduced by fifty
percent (50%) for all Net Sales above fifteen million dollars
($15,000,000) and equal to or below twenty million dollars
($20,000,000) for such calendar year.

14
<PAGE>

6. During the calendar year, should Net Sales for all Licensed
Products exceed twenty million dollars ($20,000,000), for the purpose
of calculating additional royalty payments due, the royalty
percentages in (1), (2) and (3), above, shall all be reduced to one
percent (1.0%) for all Net Sales above twenty million dollars
($20,000,000) for such calendar year.

7. Licensee agrees to pay Licensor a minimum royalty of two hundred,
fifty thousand dollars ($250,000) per year for each of the years 2000
and beyond.

8. On the effective date of the License Agreement, Licensee shall
pay to Licensor a royalty prepayment of one hundred, seventy-five
thousand dollars ($175,000), which is to be applied to future royalty
payments due to Licensor. Payment will be made in a combination
of cash and the application of amounts due Licensee by Licensor based
on the outstanding Accounts Payable Balance.

<PAGE>

EXHIBIT 10.3

AGREEMENT OF PURCHASE AND SALE OF ASSETS

BY AND BETWEEN

CRAGAR INDUSTRIES, INC.

AND

WELD RACING, INC.

SEPTEMBER 30, 1999

<PAGE>

TABLE OF CONTENTS

DESCRIPTION PAGE
- ----------- ----
<S> <C>
ARTICLE 1 OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
ARTICLE 2 THE TRANSACTION. . . . . . . . . . . . . . . . . . . . . . . . . .3
2.1 Acquired Assets. . . . . . . . . . . . . . . . . . . . . . . . . .3
2.2 Assets Not Being Acquired. . . . . . . . . . . . . . . . . . . . .4
2.3 Leased Tools . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.4 Assumed Liabilities. . . . . . . . . . . . . . . . . . . . . . . .5
2.5 Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.6 Payment of Purchase Price. . . . . . . . . . . . . . . . . . . . .5
2.7 Determination of Fair Market Value . . . . . . . . . . . . . . . .6
2.8 License Agreement. . . . . . . . . . . . . . . . . . . . . . . . .6
2.9 Left Intentionally Blank . . . . . . . . . . . . . . . . . . . . .6
2.10 Collection of Accounts Receivable. . . . . . . . . . . . . . . . .6
2.11 Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
2.12 Allocation of Purchase Price . . . . . . . . . . . . . . . . . . .7
2.13 Transfer Fees and Taxes; Prorations. . . . . . . . . . . . . . . .7
2.14 Relocation of Assets . . . . . . . . . . . . . . . . . . . . . . .7
2.15 Warranty Claims. . . . . . . . . . . . . . . . . . . . . . . . . .7
2.16 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
2.17 Returned Goods . . . . . . . . . . . . . . . . . . . . . . . . . .8
ARTICLE 3 CONDUCT PENDING THE CLOSING. . . . . . . . . . . . . . . . . . . .8
3.1 Operation of Business in Ordinary Course . . . . . . . . . . . . .8
3.2 No Negotiations. . . . . . . . . . . . . . . . . . . . . . . . . .8
3.3 Public Announcements . . . . . . . . . . . . . . . . . . . . . . .9
3.4 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . .9
3.5 Access to Information. . . . . . . . . . . . . . . . . . . . . . .9
[3.6 HSR Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
ARTICLE 4 THE PARTIES' OBLIGATIONS AT THE CLOSING. . . . . . . . . . . . . 10
4.1 The Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.2 Seller's Obligations . . . . . . . . . . . . . . . . . . . . . . 10
4.3 Buyer's Obligations. . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE 5 REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION. . . . . . . . . 10
5.1 Representations Relating to the Business . . . . . . . . . . . . 11
5.2 Representations of Buyer . . . . . . . . . . . . . . . . . . . . 11
5.3 Nature and Survival of Representations and Warranties. . . . . . 11
5.4 Indemnification by Seller. . . . . . . . . . . . . . . . . . . . 11
5.5 Indemnification by Buyer . . . . . . . . . . . . . . . . . . . . 11
5.6 Limits on Indemnification. . . . . . . . . . . . . . . . . . . . 12
5.7 Procedure for Indemnification. . . . . . . . . . . . . . . . . . 12
ARTICLE 6 ADDITIONAL AGREEMENTS. . . . . . . . . . . . . . . . . . . . . . 12
6.1 Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
6.2 Effect of Termination. . . . . . . . . . . . . . . . . . . . . . 12
6.3 Transaction Expenses . . . . . . . . . . . . . . . . . . . . . . 12
6.4 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
6.5 Governing Law and Attorneys' Fees. . . . . . . . . . . . . . . . 13
6.6 Arbitration. . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.7 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
6.8 Intent to be Binding . . . . . . . . . . . . . . . . . . . . . . 14
6.9 Waiver of Provisions . . . . . . . . . . . . . . . . . . . . . . 14
</TABLE>

<PAGE>

Schedule 1 Inventory - as of February 19, 1999
Schedule 2 Inventory - supplemental list
Schedule 3 Equipment - as of February 19, 1999
Schedule 4 Equipment - supplemental list
Schedule 5 Customer Orders
Schedule 6 Vendor Orders
Schedule 7 Tools

Exhibit A Definitions
Exhibit B Representations and Warranties of Seller
Exhibit C Representations and Warranties of Buyer
Exhibit D Procedure for Indemnification
Exhibit E Form of Bill of Sale and Assumption
Exhibit F Assumption of Contracts

<PAGE>
AGREEMENT OF PURCHASE AND SALE OF ASSETS

This Agreement is made as of September 30, 1999, by and between Weld
Racing, Inc., a Missouri corporation (the "BUYER"), and Cragar Industries, Inc.,
a Delaware corporation (the "SELLER").

ARTICLE 1
OVERVIEW

1.1 Seller engages in the business of, among others, manufacturing and
selling racing, automobile, motorcycle and light truck wheels with non-cast
wrought aluminum alloy outer rims and related accessories (the "WROUGHT WHEEL
BUSINESS").

1.2 Buyer and Seller are parties to a letter agreement dated August 26,
1999, which contemplates the acquisition by Buyer of selected assets of
Seller's business.

1.3 This Agreement supersedes the letter agreement and sets forth the
respective obligations of the parties relating to the sale of the Business.

1.4 For purposes of this Agreement, certain capitalized terms have the
meanings ascribed to them in EXHIBIT A. Other terms are defined in the body
of this Agreement.

ARTICLE 2
THE TRANSACTION

2.1 ACQUIRED ASSETS. Seller agrees to sell and deliver to Buyer the
following assets of the Wrought Wheel Business (the "ACQUIRED ASSETS"):

(a) INVENTORY. All selected inventories of supplies, raw
materials, purchased parts and components, work-in-process and finished goods
of Seller related to the Wrought Wheel Business, including, but not limited
to, all such items at Seller's facility or ordered but not yet received by
Seller as of the Closing Date (collectively, "INVENTORY"). A list of the
Inventory to be purchased, which was generated by the computer records of the
Seller, but has not been verified by a physical count is on SCHEDULE 1;

(b) EQUIPMENT. All selected machinery, equipment, perishable
tools, fixtures, chucks, shop tools, furniture, test benches, harnesses,
hardware, spare parts, and other tangible personal property owned by or in
the possession of Seller and related to the Wrought Wheel Business, whether
or not located at the Seller's facility or in the custody of any of Seller's
suppliers (collectively, the "EQUIPMENT"). A list of certain Equipment
appraised as of February 19, 1999 is listed on SCHEDULE 2, and a supplemental
list of all

3
<PAGE>

other Equipment to be purchased is attached as SCHEDULE 3;

(c) CUSTOMER ORDERS. All of Seller's rights under each uncompleted
customer order related to the Wrought Wheel Business as of the Closing Date
(collectively, the "CUSTOMER ORDERS"). A list of Customer Orders to be
purchased is attached as SCHEDULE 4;

(d) VENDOR ORDERS. All of Seller's rights under each uncompleted
vendor order related to the Wrought Wheel Business (collectively, the "VENDOR
ORDERS"). A list of Vendor Order to be purchased is attached as SCHEDULE 5;
and

(e) WARRANTY RIGHTS. All rights of Seller under express or implied
warranties from the suppliers of Seller with respect to any of the Acquired
Assets to the extent such rights may be assigned to Buyer; and

(f) INFORMATION. All operational information, together with
originals or copies of all books, records and accounts, correspondence,
records, customer lists, marketing information and any other information
which has been reduced to writing relating to or arising out of the Wrought
Wheel Business.

2.2 ASSETS NOT BEING ACQUIRED. The following assets are expressly
excluded from the assets to be delivered to Buyer (the "EXCLUDED ASSETS"):

(a) the minute books, corporate tax returns, and other documents
relating to the organizational existence of Seller as a corporation;

(b) any cash, loans and marketable securities of Seller;

(c) any of Seller's assets or properties unrelated to the Wrought
Wheel Business including, without limitations, the Seller's business relating
to the manufacture, assembly, and marketing of automobile wheels made with
steel outer rims, wire wheels, composite wheels, cast aluminum outer rims,
and one-piece cast aluminum wheels and related accessories.

(d) any tax refunds paid or payable to Seller with respect to
periods prior to the Closing;

(e) all customer and vendor orders which Buyer elects not to
acquire and are not listed on SCHEDULE 4 or SCHEDULE 5; and

(f) all deposits.

(g) all other assets not listed on Schedules 1 through 5 attached
herein.

4
<PAGE>

2.3 LEASED TOOLS. Buyer hereby agrees to lease from Seller all
selected tooling and dies used for manufacture and assembly of Wrought Wheels
("TOOLS"). A list of Tools to be leased is attached as SCHEDULE 6. Buyer
shall maintain the Tools in good working condition and upon request shall
return the Tools to Seller in similar, usable condition as provided to Buyer
except for normal use, wear and tear. The lease payment for the Tools shall
be [*] per annum, payable by Buyer on September 30, 1999 and again on each
subsequent year that the lease of the Tools remains in effect. Seller shall
have the right to terminate this Lease of the Tools at any time if (i) Buyer
is in breach of the License Agreement, or (ii) Buyer fails to maintain the
Tools in good working condition. Buyer hereby agrees to indemnify Seller for
any and all costs incurred by Seller if Seller is required to repair the
Tools upon termination of the lease of the Tools. This lease shall expire
upon expiration of the License Agreement.

2.4 ASSUMED LIABILITIES. Except as provided in SECTION 2.15 and 2.16, and
except for the Customer Orders and Vendor Orders acquired by Buyer, Buyer will
not assume any liabilities of Seller. Seller and Buyer will mutually cooperate
in order to consummate assignment of the Customer Orders and Vendor Orders to
Buyer, and Buyer will assume all liabilities and obligations under the Customer
Orders and Vendor Orders which relate to events occurring after the Closing
date.

2.5 PURCHASE PRICE. In addition to the payments to be made by Buyer under
the License Agreement and the lease of the Tools, Buyer will pay to Seller the
sum of the following amounts ("PURCHASE PRICE"):

(a) an amount equal to [*] of Seller's standard cost of the
Inventory listed on SCHEDULE 1;

(b) an amount equal to the Fair Market Value (as determined in
SECTION 2.7) for the Equipment listed on SCHEDULE 2; and

2.6 PAYMENT OF PURCHASE PRICE. Buyer will pay the Purchase Price, in
immediately available funds, as follows:

(a) Buyer shall pay for the Inventory with a Promissory Note with
terms of 1/3 net 120 days, 1/3 net 150 days, and 1/3 net 180 days from the
Closing date with the third payment used to make up any difference between
the physical inventory and the computer generated inventory records;

(b) As of and following the Closing date, Buyer shall pay for the
Equipment as it is removed from Seller's facility;

[*] Redacted Information

5
<PAGE>

2.7 DETERMINATION OF FAIR MARKET VALUE.

(a) The "Fair Market Value" for the Equipment listed on SCHEDULE 2
shall be determined in accordance with the latest independent fair market
appraisal done for Nations Credit Commercial Funding on February 19, 1999.
Alternatively, Buyer may engage at its sole expense an independent appraiser.

(b) The "Fair Market Value" for the Equipment listed on SCHEDULE 3
shall be replacement cost minus wear and tear. Alternatively, Buyer may
engage at its sole expense an independent appraiser.

2.8 LICENSE AGREEMENT. Buyer and Seller further agree that as of the
Closing date, Buyer will enter into a License Agreement with Seller for use
of the "Cragar" name and other intangible assets.

2.9 Intentionally Left Blank

2.10 COLLECTION OF ACCOUNTS RECEIVABLE.

(a) Seller will retain the title to all accounts and notes
receivable of Seller related to the Wrought Wheel Business as of the Closing
Date (the "RETAINED ACCOUNTS"). If any customer makes any payments to Buyer
for the Retained Accounts, then Buyer will immediately advance such funds to
Seller. Seller will provide to Buyer on a weekly basis a listing of those
Retained Accounts which have past due amounts owing to the Seller. Buyer
agrees it will not ship additional product to those listed customer accounts
without prior written permission of the Seller.

(b) Buyer will be entitled to all accounts and notes receivable
related to the Wrought Wheel Business which relate to periods following the
Closing Date (the "POST-CLOSING ACCOUNTS"). If any customer issues to Seller
a credit or takes a credit upon payment on Retained Accounts which should be
applied to the Post-Closing Accounts, then Buyer will immediately reimburse
such funds to Seller. If any customer makes any payments to Seller for the
Post-Closing Accounts, then Seller will immediately advance such funds to
Buyer.

2.11 EMPLOYEES. Seller will be responsible for any severance and/or
other payments, including accrued vacation and sick time, sick pay, and other
compensation, benefits, and perquisites, incurred in connection with the
termination of any of its employees. Seller will cooperate with Buyer and
make reasonable effort to make available to Buyer the non-exclusive services
of Michael Hartzmark, Michael Miller, (collectively, the "TRANSITION
EMPLOYEES"). Seller agrees to pay the salary and benefits for the Transition
Employees for a period of up to 90 days following the Closing; PROVIDED,
HOWEVER, that Buyer will pay for all relocation and travel costs incurred by
the Transition Employees. Seller agrees to provide the consulting services of
Tony Cortes, to Buyer at its facilities in Kansas City for a period up to ten
business

6
<PAGE>

days that need not be concurrent. Buyer agrees to pay for all
related travel expenses during this consulting period. If additional
consulting services are required, Buyer will pay for them at a daily per diem
rate of [*] plus related travel expenses. Notwithstanding the foregoing,
Seller shall not be liable to Buyer if any of the Transition Employees or
Tony Cortes refuse at any time to work for Buyer or are otherwise unavailable.

2.12 ALLOCATION OF PURCHASE PRICE. Promptly following the Closing,
Buyer and Seller will mutually determine the manner in which the Purchase
Price will be allocated among the Acquired Assets, and Seller and Buyer agree
to report the allocation on Internal Revenue Service Form 8594, Asset
Acquisition Statement, which they will file with their respective federal
income tax returns for the tax year that includes the Closing date.

2.13 TRANSFER FEES AND TAXES; PRORATIONS. Buyer will pay all transfer
and assumption fees and expenses and sales and use taxes arising out of the
transfer of the Acquired Assets. Seller will pay its portion, prorated as of
the Closing date, of state and local real and personal property taxes
relating to the Acquired Assets. Seller will also be responsible for any Tax
in respect of the Business or the Acquired Assets related to any period prior
to the Closing date.

2.14 RELOCATION OF ASSETS. All Acquired Assets which are at Seller's
facility (if Buyer does not assume or renegotiate the facility lease), will
be relocated at Buyer's expense as soon as is reasonably practical after the
Closing Date. Buyer and its agents will be given complete and unrestricted
access to and use of such facilities and premises for that purpose. Buyer may
occupy and use the leased facility (if Buyer does not assume or renegotiate
the facility lease) for up to six months following the Closing Date or until
Seller rejects the Lease or Seller's plan of sublease, whichever occurs
first. Thereafter, if Buyer wishes to continue to use any of such facilities,
Buyer will be responsible for making arrangements therefor with the owner(s)
of such facilities. For its use of such facilities, Buyer will pay rent to
Seller equal to the monthly rent payable by Seller to the owner of such
facilities, except that the first month of Buyer's use of the leased facility
will be rent free. Buyer shall bear the costs of utility services incurred at
facilities during its occupancy of such facilities. Buyer shall repair or
cause to be repaired, at its expense, all damage caused by its agents in
removing such assets.

[*] Redacted Information

7
<PAGE>

2.16 INSURANCE. Seller will continue its product liability insurance in
order to cover liability issues that take place prior to the Closing Date.
Following two years after the Closing Date, Seller may, at its sole election,
choose to self-insure and not purchase any additional product insurance
coverage. Seller will pay to Buyer the incremental insurance cost in excess
of [*] per year for Buyer accepting the responsibility for all product
liability for Seller's Wrought Wheels manufactured prior to the Closing Date.
Buyer will be responsible for showing Seller documentation relating to such
incremental costs, and Seller may, at its discretion, obtain a independent
quotation which, if lower, will be the maximum that Seller will be required
to pay under this SECTION 2.16.

2.17 RETURNED GOODS. Buyer will be responsible for accepting and
issuing credit, without offset to Seller, for all non-defective returned
Wrought Wheel Business products sold by Seller before the Closing Date within
the limitations of Seller's normal business practices for such Products or
within reasonably prudent business practices for the maintenance of good
customer relations.

ARTICLE 3
CONDUCT PENDING THE CLOSING

3.1 OPERATION OF BUSINESS IN ORDINARY COURSE. Prior to the Closing,
Seller will conduct its Wrought Wheel Business and affairs only in the
ordinary course and consistent with its prior practice including, but not
limited to:

(a) using its reasonable best efforts to maintain its business and
employees, sales representatives, customers, assets, suppliers, licenses and
operations in accordance with past custom and practice;

(b) not entering into any transaction related to the Wrought Wheel
Business other than in the ordinary course of business, or any transaction
with affiliated persons or entities; and

(c) not (i) incurring any debt other than in the ordinary course
of business and in amounts consistent with past practices; (ii) making any
loans; or (iii) increasing the compensation, incentive arrangements or other
benefits of any employee other than in the ordinary course of business
consistent with past practices.

[*] Redacted Information

8
<PAGE>

Business or the Acquired Assets (other than the sale of assets in the
ordinary course). Seller will promptly notify Buyer if any person contacts
Seller or inquires about any such proposal or offer.

3.3 PUBLIC ANNOUNCEMENTS. The parties will not issue any press release
or public announcement, including announcements to employees or customers,
with respect to this Agreement without the prior written consent (which
consent will not be withheld unreasonably) of Buyer or Seller, as the case
may be.

3.4 CONFIDENTIALITY. All information concerning a party provided to
the other party, other than publicly available information, will be kept in
strict confidence by such other party and will only be used to evaluate the
other party in conjunction with the transaction contemplated by this
Agreement. If this Agreement is terminated, all documents or other media
containing such information will be returned to the appropriate party.
Subject to the limitations above, nothing herein precludes a party from
developing or offering products or services competitive with those of the
other party. The parties may disclose information to their Representatives
so long as they agree to keep such information confidential.

3.5 ACCESS TO INFORMATION.

(a) Buyer and its Representatives will have the opportunity to
make a complete due diligence review of the books, records, business, and
affairs of Seller, including, the Acquired Assets and the leased premises.
To facilitate the due diligence review, Seller will provide to Buyer and its
Representatives complete access to all of Seller's records and documents,
will provide Buyer with personal, bank, and professional references, and will
make available for consultation customers, employees, suppliers, and
distribution channels.

(b) Seller and its Representatives will have the opportunity to
make a complete due diligence review of the books, records, business, and
affairs of Buyer. To facilitate the due diligence review, Buyer will provide
to Seller and its Representatives complete access to all of Buyer's records
and documents, will provide Seller with personal, bank, and professional
references, and will make available for consultation customers, employees,
suppliers, and distribution channels.

[3.6 HSR ACT. To the extent required by law, Seller and Buyer shall each file
with the FTC and the DOJ any notifications required to be filed by their
respective "ultimate parent entities" under the HSR Act, with respect to the
transactions contemplated herein. Each party shall be responsible for all
expenses incurred in the preparation of their respective HSR Act filings and
the filing fees to be paid in connection with the HSR Act filings. The
parties shall use their reasonable best efforts to make such filings
promptly, to respond to any requests for additional information made by
either the FTC or DOJ, and to cause the waiting periods under the HSR Act to
terminate or expire at the earliest possible date.]

9
<PAGE>

ARTICLE 4
THE PARTIES' OBLIGATIONS AT THE CLOSING

4.1 THE CLOSING. The closing ("CLOSING") of these transactions will be
held on September ___, 1999 at a time and place as the parties mutually agree.

4.2 SELLER'S OBLIGATIONS. At the Closing, Seller will deliver the
following:

(a) physical possession, as possible, of the Acquired Assets in
accordance with SECTION 2.1;

(b) releases of all liens, encumbrances and security interests in
respect of the Acquired Assets and evidences of all payoffs;

(d) the License Agreement referred to in SECTION 2.8;

(e) an executed Bill of Sale, attached as EXHIBIT E, which conveys to
Buyer legal title to all of the Acquired Assets;

(f) certified resolutions of the Seller's Board of Directors and
shareholders approving this Agreement; and

(g) certificates from the state taxing authorities as evidence that
all sales and use tax liabilities of Seller accruing before the Closing date
have been fully satisfied.

4.3 BUYER'S OBLIGATIONS. At the Closing, Buyer will deliver the
following:

(a) Payment of the Purchase Price in accordance with SECTION 2.6;

(b) certified resolutions of the Board of Directors of Buyer
necessary to approve this Agreement;

(d) the License Agreement referred to in SECTION 2.8; and

(e) the Assumption of Contracts attached as EXHIBIT F, which conveys
to Buyer the Customer Orders and Vendor Orders.

ARTICLE 5
REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION

<PAGE>

5.1 REPRESENTATIONS RELATING TO THE BUSINESS. Concurrently with the
signing of this Agreement, Seller has prepared a Disclosure Letter which
discloses certain information to Buyer. Seller acknowledges that Buyer is
relying on the accuracy of the representations and warranties contained in
EXHIBIT B. Accordingly, Seller warrants to Buyer that, except for those
matters which have been disclosed to Buyer in the Disclosure Letter, each of
the representations and warranties contained in EXHIBIT B are true and
correct (in all material respects) on the date of this Agreement, and will
again be true and correct (in all material respects) on the Closing date.

5.2 REPRESENTATIONS OF BUYER. Buyer acknowledges that Seller is
relying on the accuracy of the representations and warranties contained in
EXHIBIT C. Accordingly, Buyer warrants to Seller that each of the
representations and warranties contained in EXHIBIT C are true and correct
(in all material respects) on the date of this Agreement, and will again be
true and correct (in all material respects) on the Closing date.

5.3 NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Each
statement and agreement made by any of the parties in this Agreement or in
any document or other instrument delivered by or on behalf any of the parties
pursuant to this Agreement will survive for a period of one (1) year
following the Closing of this Agreement.

5.4 INDEMNIFICATION BY SELLER. Seller agrees to indemnify and hold
Buyer harmless from and against any Loss incurred by Buyer in connection with
or alleged to result from the following:

(a) a breach by Seller of any representation or warranty made
pursuant to SECTION 5.1 above or otherwise in this Agreement;

(b) a breach by Seller of any of its other obligations or
covenants contained in this Agreement;

5.5 INDEMNIFICATION BY BUYER. Buyer agrees to indemnify, defend and
hold Seller harmless from and against any Loss incurred by Seller in
connection with or alleged to result from the following:

(a) a breach by Buyer of any representation or warranty made
pursuant to SECTION 5.2 above or otherwise in this Agreement;

(b) a breach by Buyer of any of its obligations or covenants
contained in this Agreement;

<PAGE>

(d) any liability arising from the actions of the Transition
Employees while under the supervision or control of Buyer.

5.6 LIMITS ON INDEMNIFICATION. In order to limit certain transaction
expenses, the parties acknowledge and agree that neither party may seek
indemnification under this ARTICLE 5 unless the aggregate claims exceed
$10,000.

5.7 PROCEDURE FOR INDEMNIFICATION. The party that is entitled to be
indemnified hereunder shall follow the procedures set forth in EXHIBIT D.

ARTICLE 6
ADDITIONAL AGREEMENTS

6.1 TERMINATION. This Agreement may be terminated at any time prior to
the Closing:

(a) by mutual written consent of Buyer and Seller;

(b) by either Buyer or Seller if the other party breaches any of
its material representations, warranties, or covenants contained in this
Agreement and, if the breach is curable, the breach is not cured within five
(5) business days after notice; or

(c) by either Buyer or Seller if the Closing does not occur on or
before ________, 1999 (except that no party shall have the right to terminate
this Agreement unilaterally if the event giving rise to the non-occurrence of
the Closing is primarily attributable to that party or to any affiliated
party).

6.4 NOTICES. All notices, and other communications hereunder will be
in writing and deemed to have been given when (i) delivered by hand, (ii)
sent by telecopier (with receipt confirmed), provided that a copy is mailed
by registered mail, postage pre-paid return receipt requested, or (iii) when
actually received by the addressee, in each case to the following:

<PAGE>

If to Seller: Cragar Industries, Inc.
4636 North 43rd Avenue
Phoenix, Arizona 85031
Phone: (623) 247-1300, ex. 508
FAX: (623) 846-0684
Attn: Michael Hartzmark

With a copy to: Snell & Wilmer L.L.P.
One Arizona Center
Phoenix, Arizona 85004-0001
Phone: (602) 382-6363
FAX: (602) 382-6070
Attn: Richard Stagg, Esq.

If to Buyer: Weld Racing, Inc.
933 Mulberry Street
Kansas City, Missouri 64101
Phone: (816) 421-8040
FAX: (816) 235-7452
Attn: Greg Weld

With a copy to: Bryan Cave L.L.P.
7500 College Boulevard, Suite 1100
Overland Park, Kansas 66210-4035
Phone: (913) 338-7701
FAX: (913) 338-7777
Attn: Tom VanDyke

6.5 GOVERNING LAW AND ATTORNEYS' FEES. The validity, construction, and
enforceability of this Agreement shall be governed in all respects by the
laws of the State of Arizona, without regard to its conflict of laws rules.
If any legal action or any arbitration or other proceeding is brought in
connection with this Agreement, each party will pay their own attorneys'
fees, accounting fees, and other costs incurred in that action or proceeding.

6.6 ARBITRATION. Any controversy relating to this Agreement or
relating to the breach hereof shall be settled by arbitration conducted in
Phoenix, Arizona in accordance with the Commercial Arbitration Rules of the
American Arbitration Association then in effect. The award rendered by the
arbitrator(s) shall be final and judgment upon the award rendered by the
arbitrator(s) may be entered upon it in any court having jurisdiction
thereof. The arbitrator(s) shall possess the powers to issue mandatory
orders and restraining orders in connection with such arbitration. The
expenses of the arbitration shall be borne by each party unless otherwise
allocated by the arbitrator(s). The agreement to arbitrate shall be
specifically enforceable under the prevailing arbitration law. During the
continuance of any arbitration proceedings, the parties shall continue to
perform their respective obligations under this Agreement. Nothing herein
shall preclude

<PAGE>

the Seller or any affiliate or successor from seeking equitable relief,
including injunction or specific performance, in any court having
jurisdiction, in connection with the non-compete agreement.

6.7 ASSIGNMENT. This Agreement will not be assigned by operation of
law or otherwise, except that this Agreement may be assigned by operation of
law to any corporation or entity with or into which Seller may be merged or
consolidated or to which Seller transfers all or substantially all of its
assets, and such corporation or entity assumes this Agreement and all
obligations and undertakings of Seller hereunder. This Agreement allows
Buyer to assign all of its rights to its primary lender, subject to the terms
and conditions set forth in this Agreement and the Exclusive Field of Use
License Agreement dated September 30, 1999.

6.8 INTENT TO BE BINDING. The Schedules and Exhibits referred to
herein are incorporated herein by reference as if fully set forth in the text
of this Agreement. This Agreement may be executed in any number of
counterparts, and each counterpart constitutes an original instrument, but
all such separate counterparts constitute one and the same agreement. This
Agreement may not be amended except by an instrument in writing approved by
Buyer and Seller. If any term, provision, covenant, or restriction of this
Agreement is held by a court to be invalid or unenforceable, the remainder of
the terms, provisions, covenants, and restrictions of this Agreement will
remain in full force and effect and will in no way be affected or invalidated
and the court will modify this Agreement or, in the absence thereof, the
parties agree to negotiate in good faith to modify this Agreement to preserve
each party's anticipated benefits under this Agreement.

6.9 WAIVER OF PROVISIONS. The terms, covenants, representations,
warranties, and conditions of this Agreement may be waived only by a written
instrument executed by the party waiving compliance. The failure of any
party at any time to require performance of any provisions hereof will, in no
manner, affect the right at a later date to enforce the same. No waiver by
any party of any condition, or breach of any provision, term, covenant,
representation, or warranty contained in this Agreement, whether by conduct
or otherwise, in any one or more instances, will be deemed to be or construed
as a further or continuing waiver of any such condition or of the breach of
any other provision, term, covenant, representation, or warranty of this
Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

CRAGAR INDUSTRIES, INC., a
Delaware corporation

By:________________________________
Name:______________________________
Title:_____________________________

WELD RACING, INC.,
a Missouri corporation

By:________________________________
Name:______________________________
Title:_____________________________

<PAGE>

Schedule 1
Inventory-as of February 19, 1999
[*]

[*] Redacted Information

<PAGE>

Schedule 2
Inventory-Supplemental list
[*]

[*] Redacted Information

<PAGE>

Schedule 3
Equipment-as of February 19, 1999.
[*]

[*] Redacted Information

<PAGE>

Schedule 4
Equipment-Supplemental list
[*]

[*] Redacted Information

<PAGE>

Schedule 5
Customer Orders.
[*]

[*] Redacted Information

<PAGE>

Schedule 6
Vendor Orders.
[*]

[*] Redacted Information

<PAGE>

Schedule 7
TOOLS
[*]

[*] Redacted Information.

<PAGE>

EXHIBIT A

DEFINITIONS

1. DEFINITIONS. For purposes of this Agreement, the following terms
have the following meanings.

"ACCOUNTS RECEIVABLE" means all selected accounts and notes receivable
of Seller related to the Wrought Wheel Business as of the Closing Date which
are Current Receivables (i.e., bona fide accounts receivable resulting from
sales and shipments of Wrought Wheel Business products to credit worthy
customers of Seller within sixty days immediately preceding the Closing Date
and are not heavily concentrated accounts or contra accounts which are deemed
unacceptable by Bank of America Commercial Funding Commercial Finance),
Future Receivables (i.e. bona fide accounts receivable resulting from sales
and shipments of Wrought Wheel Business products to customers of Seller
within ninety days immediately preceding the Closing Date in which Seller
agreed at the time of sales that the customer need not pay for the products
for up to ninety days following the sale), or other bona fide accounts
receivable.

"APPLICABLE LAWS" means all laws and regulations of foreign, federal,
state, and local governments and all agencies regulating or otherwise
affecting the Wrought Wheel Business or the Acquired Assets, including,
without limitation, employee health and safety, the discharge of pollutants
or wastes, and employee benefit plans.

"CONTRACT" means any (i) collective bargaining agreement or contract
with any labor union; (ii) bonus, pension, profit sharing, retirement, or
other form of deferred compensation plan; (iii) hospitalization insurance, or
similar plan or practice, whether formal or informal; (iv) contract for the
employment or compensation of any officer, individual employee, or other
person on a full-time or consulting basis or relative to severance pay or
change-in-control benefits for any such person; (v) agreement or indenture
relating to the borrowing of money in excess of $[*] relating to the
Wrought Wheel Business or Acquired Assets or to mortgaging, pledging, or
otherwise placing a lien on any of the Acquired Assets; (vi) guaranty of any
obligation for borrowed money or otherwise, other than endorsements made for
collection; (vii) lease or agreement under which it is lessor or lessee of,
or permits any third party to hold or operate, any Acquired Assets; or (viii)
other agreement material to the Wrought Wheel Business or not entered into in
the ordinary course of business.

"GAAP" means generally accepted United States accounting principles,
applied on a basis consistent with the basis on which the Balance Sheet and
the other financial statements were prepared.

"HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976
or any successor law, and regulations and rules issued pursuant to that Act
or any successor law.

[*] Redacted Information

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EXHIBIT A

"INDEMNIFIED PARTY" means the party which is entitled to be indemnified
under this Agreement.

"INDEMNIFYING PARTY" means the party required to indemnify under this
Agreement.

"INSIDERS" means an officer, director, or shareholder of Seller or
Buyer, as the case may be, or any member of the immediate family of any such
officer, director, or shareholder, or any entity in which any of such persons
owns any beneficial interest, other than a publicly held corporation whose
stock is traded on a national securities exchange or in the over-the-counter
market and less than 1% of the stock of which is beneficially owned by any of
such persons.

"LOSS" mean all costs, expenses, losses, damages, fines, penalties,
liabilities, lost profits or other losses (including, without limitation,
interest which may be imposed in connection therewith, court costs,
litigation expenses, and reasonable attorneys' and accounting fees).

"REPRESENTATIVE" means any officer, director, principal, attorney,
agent, employee or other representative.

"SUBSIDIARY" means any corporation of which securities having a majority
of the ordinary voting power in electing directors are owned by Seller, or
Buyer, as the case may be, directly or through another Subsidiary.

"TAX" means any federal, state, local, foreign or other tax, levy,
impost, fee, assessment or other government charge, including without
limitation (i) income, estimated income, business, occupation, franchise,
property, payroll, personal property, sales, transfer, use, employment,
commercial rent, occupancy, franchise or withholding taxes, and (ii) any
premium, interest, penalties and additions in connection therewith.

A-2

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EXHIBIT B

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Buyer as follows:

1. ORGANIZATION AND QUALIFICATION. Seller is a corporation duly
organized, validly existing, and in good standing under the laws of the State
of Delaware, and has the requisite corporate power and authority to own and
operate its properties and to carry on its business as now conducted. Seller
is duly qualified to do business and is in good standing in the states of
Arizona and Delaware, the only jurisdictions where the failure to be so
qualified would have a material adverse effect on its business, properties,
or ability to conduct the business currently conducted by it.

2. AUTHORITY RELATIVE TO THIS AGREEMENT. Seller has the requisite
corporate power and authority to enter into this Agreement and to carry out
its obligations hereunder. The execution and delivery of this Agreement by
Seller and the consummation by Seller of these transactions has been duly
authorized by the Board of Directors of Seller and has been duly approved by
all of the shareholders of Seller, and no other corporate proceedings on the
part of Seller are necessary to authorize this Agreement and such
transactions. This Agreement has been duly executed and delivered by Seller,
and constitutes a valid and binding obligation of Seller, enforceable in
accordance with its terms.

3. NO CONFLICTS. Except as set forth in the Disclosure Letter, the
Seller is not subject to, or obligated under, any provision of (a) its
Articles of Incorporation, Bylaws, or other organizational documents, (b) any
agreement, arrangement, or understanding, (c) any license, franchise, or
permit, or (d) any Applicable Law which would be breached or violated, or in
respect of which a right of termination or acceleration would arise, or
pursuant to which any encumbrance on any of its assets would be created, by
its execution, delivery, and performance of this Agreement and the
consummation by it of the transactions contemplated hereby.

4. NO CONSENTS. Except for the consent of the Board of Directors,
Shareholders and Bank of America Commercial Funding Commercial Finance, no
authorization, consent, or approval of, or filing with, any public body,
court, or authority is necessary on the part of Seller for the consummation
by Seller of the transactions contemplated by this Agreement.

5. FINANCIAL STATEMENTS. Seller has provided to Buyer for the 1997
and 1998 year-end audited financial statements and the Seller's most current
monthly financial statements. All of these financial statements have been
prepared in accordance with GAAP applied on a consistent basis throughout the
periods involved and fairly present the financial position of Seller as of
the dates thereof and the results of its operations and cash flows for the
periods then ended.

6. SELLER'S SEC REPORTING. Seller files periodic reports pursuant to
the Securities Exchange Act of 1934 (the "SEC REPORTS"). Since December
1996, Seller has

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EXHIBIT B

duly filed all SEC Reports required to be filed, and no such report, as of
the date filed, contained any untrue statement of material fact or omitted to
state any material fact required to be stated therein or necessary to make
the statements in such report, in light of the circumstances under which they
were made, not misleading. The financial statements included in such SEC
Reports were prepared in accordance with generally accepted accounting
principles applied on a consistent basis throughout the periods involved and
present fairly the consolidated financial position, results of operation, and
cash flows of Seller and its consolidated subsidiaries as of the dates and
for the periods indicated, subject, in the case of unaudited interim
statements, to normal year-end adjustments and the absence of complete
footnote disclosure.

7. COMPLIANCE WITH LAWS. Seller and its officers, directors, agents,
and employees have complied with all Applicable Laws related to the Wrought
Wheel Business and Acquired Assets, and no claims have been filed against
Seller alleging a violation of any Applicable Law, except as set forth in the
Disclosure Letter.

8. LITIGATION. Except as set forth in the Disclosure Letter, there
are no suits, claims, actions, arbitrations, investigations, or proceedings
entered against, now pending, or threatened against Seller before any court,
arbitration, administrative or regulatory body, or any governmental agency
which may result in any judgment, order, award, decree, liability, or other
determination which will or could reasonably be expected to have any effect
upon Seller, the Acquired Assets, or the Wrought Wheel Business. Seller is
not subject to any continuing court or administrative order, writ,
injunction, or decree applicable to it or the Wrought Wheel Business, or to
its property or employees, and Seller is not in default with respect to any
order, writ, injunction, or decree of any court or federal, state, municipal,
or other governmental department, commission, board, agency, or
instrumentality.

9. GOOD TITLE TO AND CONDITION OF THE ACQUIRED ASSETS.

a. The Inventory listed on SCHEDULE 1 is carried on Seller's books
and records at a value determined in accordance with GAAP.

b. Seller owns the Acquired Assets free and clear of all liens,
encumbrances and security interests, except as disclosed in the Disclosure
Letter, or leases such equipment under valid leases, all of which are
listed in the Disclosure Letter. Seller is not in default, and no
circumstances exist which could result in such default, under any of such
equipment leases, nor is any other party to any of such equipment leases in
default.

10. OTHER CONTRACTS AND COMMITMENTS.

a. The Disclosure Letter sets forth the material terms of each
Contract and identifies each Contract which is not terminable at will by
Seller.

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EXHIBIT B

b. Seller has furnished Buyer with a true and correct copy of each
written Contract, and a written description of each oral Contract referred
to in the Disclosure Letter, together with all amendments, waivers, or
other changes thereto.

c. Except as specifically disclosed in the Disclosure Letter: (i)
no supplier has indicated that it will stop or decrease the rate of
business done with Seller, except for changes in the ordinary course of the
Wrought Wheel Business; (ii) Seller has performed in all material respects
the obligations required to be performed by it in connection with the
Contracts and Seller has not been advised of or received any claim of
default under any Contract required to be disclosed hereunder; (iii) Seller
has no present expectation or intention of not fully performing any
obligation pursuant to any Contract; and (iv) there has been no breach and
there is no anticipated breach by any other party to any Contract.

d. Seller must disclose any pending credits due on any account for
advertising allowance or co-op, volume bonus rebates, or any other type of
credit or rebate.

e. Seller must state any pricing commitments, guarantees or
contracts with customers or vendors.

11. SOLVENCY; BULK SALES. Seller is solvent and able to pay its
outstanding debts as they mature. Seller will not be rendered insolvent by
the transfer of the Acquired Assets pursuant to this Agreement, and the
transfer of the Acquired Assets is not fraudulent to any creditor or equity
interest holder of Seller. There is no state bulk sales or bulk transfer law
applicable to the sale of the Acquired Assets to Buyer.

12. TAX MATTERS. Seller has filed all federal, foreign, state, county,
and local income, excise, property, sales, employment-related wages and
benefits, and other tax returns which are required to be filed by it or them,
as the case may be, in respect of Seller, the Wrought Wheel Business or the
Acquired Assets, and all such returns are true and correct; all taxes due and
payable by Seller in respect of Seller, the Wrought Wheel Business or the
Acquired Assets have been paid; Seller's provisions for taxes on the most
recent balance sheet and any other financial statements delivered hereunder
are sufficient for all accrued and unpaid taxes as of the dates of such
balance sheets; Seller has paid all taxes due and payable by it or which it
is obligated to withhold from amounts owing to any employee, creditor, or
third party; Seller has not waived any statute of limitations in respect of
taxes or agreed to any extension of time with respect to a tax assessment or
deficiency; the assessment of any additional taxes relating to or for periods
for which returns have been filed is not expected; and Seller has not
received notice of any unresolved questions or claims concerning its tax
liability.

B-3

<PAGE>

EXHIBIT C

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to Seller each of the following:

1. ORGANIZATION AND QUALIFICATION. Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State
of Missouri, and has the requisite corporate power and authority to own and
operate its properties and to carry on its business as now conducted in every
jurisdiction where the failure to do so would have a material adverse effect
on its business, properties, or ability to conduct the business currently
conducted by it.

2. AUTHORITY RELATIVE TO THIS AGREEMENT. Buyer has the requisite
corporate power and authority to enter into this Agreement and to carry out
its obligations hereunder. The execution and delivery of this Agreement by
Buyer and the consummation by Buyer of the transactions contemplated hereby
have been duly authorized by Buyer, and no other corporate proceedings on the
part of Buyer are necessary to authorize this Agreement and such
transactions. This Agreement has been duly executed and delivered by Buyer
and constitutes a valid and binding obligation of Buyer, enforceable in
accordance with its terms, except as the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, or other similar laws
relating to the enforcement of creditors' rights generally and by general
principles of equity.

3. NO CONFLICTS. Buyer is not subject to, or obligated under, any
provision of (a) its Certificate of Incorporation or Bylaws, (b) any material
agreement, arrangement, or understanding, (c) any material license,
franchise, or permit, or (d) any law, regulation, order, judgment, or decree,
which would be breached or violated, or in respect of which a right of
termination or acceleration would arise, or pursuant to which any encumbrance
on any of its or any of its subsidiaries' material assets would be created,
by its execution, delivery, and performance of this Agreement and the
consummation by it of the transactions contemplated hereby.

4. NO CONSENTS. Except for the consent of the Board of Directors and
PNC Business Credit, no authorization, consent, or approval of, or filing
with, any public body, court, or authority is necessary on the part of Buyer
for the consummation by Buyer of the transactions contemplated by this
Agreement

5. COMPLIANCE WITH LAWS. Buyer and its officers, directors, agents,
and employees have complied with all Applicable Laws related to Buyer's
business, and no claims have been filed against Buyer alleging a violation of
any Applicable Law, except as set forth in the Disclosure Letter.

6. LITIGATION. Except as set forth in the Disclosure Letter, there
are no suits, claims, actions, arbitrations, investigations, or proceedings
entered against, now pending, or threatened against Buyer before any court,
arbitration, administrative or regulatory body, or any governmental agency
which may result in any judgment, order, award, decree, liability, or other
determination which will or could reasonably be expected to

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<PAGE>

EXHIBIT C

have any effect upon Buyer, the Acquired Assets, or the Wrought Wheel
Business. Buyer is not subject to any continuing court or administrative
order, writ, injunction, or decree applicable to it or the Wrought Wheel
Business, or to its property or employees, and Buyer is not in default with
respect to any order, writ, injunction, or decree of any court or federal,
state, municipal, or other governmental department, commission, board,
agency, or instrumentality.

7. BUYER'S REVIEW OF SELLER AND COMPANY INFORMATION. Buyer
acknowledges that it has reviewed Seller's SEC Reports, and has had an
opportunity to ask questions of and to receive answers from Seller regarding
these reports and the affairs and prospects of Seller in general, and desires
no further information pertaining to Seller. In addition, Buyer acknowledges
that it has reviewed and understands the business strategy and plans of the
Company, has had an opportunity to ask questions of and to receive answers
from the Company regarding its affairs and prospects, and desires no further
information regarding the Company. Buyer acknowledges that an investment in
Seller and especially in the Company involves a significant degree of risk,
and that it is able to bear the risk of loss of these investments.

8. FINANCIAL STATEMENTS. The audited 1997 and 1998 year-end financial
statements and the Buyer's most current monthly financial statements are
attached to the Disclosure Letter. All of these financial statements have
been prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved and fairly present the financial position of
Buyer as of the dates thereof and the results of its operations and cash
flows for the periods then ended.

9. PARENT AND/OR SUBSIDIARIES. Except as disclosed in the Disclosure
Letter, Buyer does not have, nor has it ever had, a Parent or any
Subsidiaries and Buyer does not own, and has never otherwise owned, any
stock, partnership interest, joint venture interest, or any other security
issued by or equity interest in any other corporation, organization,
association, or entity.

10. NO RESTRICTIONS ON BUSINESS ACTIVITIES. There is no agreement
(noncompete or otherwise), commitment, judgment, injunction, order, or decree
to which Buyer is a party or otherwise binding on Buyer or its property which
has or reasonably could be expected to have the effect of prohibiting or
impairing any business practice of Buyer, any acquisition of property
(tangible or intangible) by Buyer, or the conduct of the Wrought Wheel
Business.

11. INSURANCE. The Disclosure Letter lists and briefly describes each
insurance policy and fidelity bond maintained by Buyer with respect to its
respective properties, assets, employees, officers, and directors and sets
forth the date of expiration of each such insurance policy. All of such
insurance policies are in full force and effect and Buyer is not in default
with respect to its obligations under any of such insurance policies. There
is no claim of Buyer pending under any of such policies or bonds as to which
coverage has been questioned, denied, or disputed by the underwriters of such
policies or bonds and there has been no threatened termination of, or
material premium increase with

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<PAGE>

EXHIBIT C

respect to, any of such policies. To the best knowledge of Buyer, the
insurance coverage is customary for corporations of similar size engaged in
similar lines of business.

12. AFFILIATE TRANSACTIONS. Except as set forth in the Disclosure
Letter, no Insiders have any agreement with Buyer or any interest in any
property (real, person, or mixed, tangible or intangible) used in or
pertaining to Buyer's business.

13. DISCLOSURE. There is no fact which has not been disclosed to Seller
which materially adversely affects or could reasonably be anticipated to
materially adversely affect the assets, financial condition or results of
operations, customer, employee or supplier relations, business condition,
prospects, or financing arrangements of Buyer.

C-3

<PAGE>

EXHIBIT D

PROCEDURE FOR INDEMNIFICATION

1. The Indemnified Party will promptly give notice hereunder to the
Indemnifying Party after obtaining written notice of any claim as to which
recovery may be sought against the Indemnifying Party.

2. If the indemnity claim arises from the claim of a third party, the
Indemnified Party will permit the Indemnifying Party to assume the defense of
any such claim and any litigation resulting from such claim. If the
Indemnifying Party assumes the defense of a third-party claim, the
obligations of the Indemnifying Party as to such claim will include taking
all steps necessary in the defense or settlement of such claim or litigation
and holding the Indemnified Party harmless from and against any and all
damages caused by or arising out of any settlement approved by the
Indemnifying Party or any judgment in connection with such claim or
litigation. The Indemnifying Party shall not, in the defense of such claim
or any litigation resulting therefrom, consent to entry of any judgment
(other than a judgment of dismissal on the merits without costs) except with
the written consent of the Indemnified Party, or enter into any settlement
(except with the written consent of the Indemnified Party) which does not
include as an unconditional term thereof the giving by the claimant or the
plaintiff to the Indemnified Party a release from all liability in respect of
such claim or litigation. The Indemnified Party may, with counsel of its
choice and at its expense, participate in the defense of any such claim or
litigation.

3. If the Indemnifying Party does not assume the defense of any such
claim by a third-party or resulting litigation after receipt of notice from
the Indemnified Party, the Indemnified Party may defend against such claim or
litigation in such manner as it deems appropriate, and unless the
Indemnifying Party deposits with the Indemnified Party a sum equivalent to
the total amount demanded in such claim or litigation plus the Indemnified
Party's estimate of the costs of defending the same, the Indemnified Party
may settle such claim or litigation on such terms as it may deem appropriate
and the Indemnifying Party will promptly reimburse the Indemnified Party for
the amount of such settlement and for all damages incurred by the Indemnified
Party in connection with the defense against or settlement of such claim or
litigation. If the Indemnifying Party fails to notify an Indemnified Party
of its election to defend any such claim or action by a third party within 15
days after the Indemnifying Party received noticed of such claim or action,
then the Indemnifying Party will be deemed to have waived its right to defend
such claim or action.

4. The Indemnifying Party will promptly reimburse the Indemnified
Party for the amount of any judgment rendered with respect to any claim by a
third-party in such litigation and for all damage incurred by the Indemnified
Party in connection with the defense against such claim or litigation,
whether or not resulting from or arising out of the act of a third-party.

5. The right to indemnification hereunder will not be affected by any
failure of an Indemnified Party to give such notice, or delay by an
Indemnified Party in giving such notice, unless, and then only to the extent
that, the rights and remedies of the Indemnifying Party will have been
prejudiced as a result of the failure to give, or delay in giving, such
notice.

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<PAGE>
EXHIBIT E

BILL OF SALE

For good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, CRAGAR INDUSTRIES, INC., a Delaware corporation,
("SELLER"), does hereby grant, bargain, transfer, sell, assign, convey and
deliver to WELD RACING, INC., a Missouri corporation ("BUYER"), all right,
title and interest in and to the Assets as such term is defined in the Asset
Purchase Agreement dated as of _________________, 1999 by and among Buyer and
Seller (the "AGREEMENT"). Buyer hereby acknowledges that Seller is making no
representation or warranty with respect to the assets being conveyed hereby
except as specifically set forth in the Agreement. Seller for itself, its
successors and assigns hereby covenants and agrees that, at any time and from
time to time forthwith upon the written request of Buyer, Seller will do,
execute, acknowledge and deliver or cause to be done, executed, acknowledged
and delivered, each and all of such further acts, deeds, assignments,
transfers, conveyances, powers of attorney and assurances as may reasonably
be required by Buyer in order to assign, transfer, set over, convey, assure
and confirm unto and vest in Buyer, its successors and assigns, title to the
assets sold, conveyed, transferred and delivered by this Bill of Sale.

This Bill of Sale is being executed and delivered by Seller as of the
date set forth below pursuant to the terms of the Agreement.

Executed at ___________________________________, this _____ day of 1999.

CRAGAR INDUSTRIES, INC., a Delaware corporation

By: _____________________________
Michael Hartzmark, President

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<PAGE>

EXHIBIT F

ASSUMPTION OF CONTRACTS

Pursuant to the Agreement of Purchase and Sale of Assets, dated as of
September 30, 1999 ("PURCHASE AGREEMENT"), by and among Weld Racing, Inc., a
Missouri corporation ("BUYER") and Cragar Industries, Inc., a Delaware
corporation ("SELLER"), for good and valuable consideration, the receipt and
adequacy of which are acknowledged, Buyer does assume the Customer Orders and
Vendor Orders as such terms are defined in the Purchase Agreement; PROVIDED,
HOWEVER, that Buyer will assume such liabilities and obligations under the
Customer Orders and Vendor Orders only to the extent such liabilities and
obligations arise after the Closing Date (as defined in the Purchase
Agreement). Except as expressly assumed herein, Buyer does not assume and
will not in any manner be responsible for any liability, obligation, lien or
encumbrance of Seller.

Dated this ___ day of _________, 1999.

WELD RACING, INC., a Missouri corporation

By: __________________________
Richard G. Weld, President

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<PAGE>

EXHIBIT 10.4

EXCLUSIVE FIELD OF USE LICENSE AGREEMENT

This Agreement, and any Exhibits, Schedules, and Appendices
(collectively, the "AGREEMENT"), effective as of September 30, 1999, is
entered into between Cragar Industries, Inc., a Delaware corporation having
its principal place of business at 4636 North 43rd Avenue, Phoenix, Arizona
85031 (hereinafter "LICENSOR"), and Weld Racing, Inc., a Missouri corporation
having its principal place of business at 933 Mulberry Street, Kansas City,
Missouri 64101 (hereinafter "LICENSEE").

WHEREAS, Licensor is the owner of the various trademark and/or
servicemark rights listed on the attached SCHEDULE A (hereinafter the
"TRADEMARK RIGHTS");

WHEREAS, Licensor is the owner of the various patent rights listed on
the attached SCHEDULE B (hereinafter the "PATENT RIGHTS");

WHEREAS, Licensee and Licensor have entered into a certain Agreement of
Sale and Purchase of Assets, dated as of September 30, 1999; and

WHEREAS, Licensee desires to obtain an exclusive license, in the field
of use designated herein, under the Trademark Rights, the Patent Rights, and
other intangible rights owned by Licensor.

NOW, THEREFORE, in consideration of the premises, the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

1. DEFINITIONS

1.1. "PATENTED PRODUCT" means any device or system covered by a claim
of any currently issued patent contained in the Patent Rights, or any patent
that issues from a currently pending patent application contained in the
Patent Rights.

1.2. "LICENSED PRODUCTS" means the products listed on the attached
SCHEDULE C and any Patented Product.

1.3. "LICENSED PRODUCT CLASS" means one of the categories of Licensed
Products set forth on the attached SCHEDULE C.

1.4. "LICENSED FIELD" means the Licensor's line of racing, automobile,
motorcycle and light truck wheels having a non-cast, wrought aluminum alloy
outer rim, and related accessories (whether currently offered by Licensor or
to be developed in the future).

1.5. "IMPROVEMENT" means any modification in the structure or design
of the Licensed Products, whether patentable or unpatentable, which depends
upon a Licensed

<PAGE>

Product for its use or effectiveness or which increases the effectiveness or
manufacturability of a Licensed Product, including, without limitation, any
modification of a part, component, or process or apparatus for the
manufacture thereof.

1.6. "INTANGIBLE RIGHTS" means (i) any and all documents in whatever
form, including but not limited to writings, computer disks, computer tapes,
and electronic records, containing design and technical information,
engineering or production data, drawings, plans, specifications, techniques,
methods, processes, trade secrets, reports, models, market research data,
customer lists, and any and all other material or matter used by or in
possession of Licensor and applicable to the design, manufacture, assembly,
service, and sale of the Licensed Products, (ii) Licensor's general and
specific knowledge, experience, and information, not in written or printed
form, applicable to the design, manufacture, assembly, service, and sale of
the Licensed Products, and (iii) any other trade secret information, and
proprietary information that may be applicable to the design, manufacture,
assembly, service, and sale of the Licensed Products.

1.7. "LICENSED RIGHTS" means one or more of any of the Trademark
Rights, the Patent Rights, and the Intangible Rights.

2. LICENSE GRANT

2.1. TRADEMARKS. Licensor grants to Licensee a worldwide exclusive
license in the Licensed Field to use the Trademark Rights in connection with
the marketing and sale of the Licensed Products, subject to the terms of this
Agreement.

2.1.1. The parties agree that Licensee's use of the Trademark
Rights, including the goodwill arising from such use, shall inure to the
benefit of Licensor, and Licensee shall have no right whatsoever to the
Trademark Rights except as specifically set forth herein. Licensee agrees
to not use the Trademark Rights, or any simulation or variant thereof, or
any mark, name, logo, design, likeness, or other representation
confusingly similar to any of the marks included in the Trademark Rights,
except as specifically set forth herein.

2.1.2. Licensee shall not at any time do or cause to be done
any act or thing contesting or in any way impairing or tending to impair
any part of Licensor's right, title, and interest respecting the Trademark
Rights. Licensee shall not in any manner represent that it has any
ownership in the Trademark Rights, and Licensee acknowledges that its use
of the Trademark Rights shall not create in Licensee's favor any right,
title, or interest in or to the Trademark Rights.

2.2. LICENSED PRODUCTS. Licensor grants to Licensee a worldwide
exclusive license in the Licensed Field to make, use, sell, and offer for
sale the Licensed Products, subject to the terms of this Agreement. In
connection with this grant, Licensor grants to Licensee a worldwide exclusive
license in the Licensed Field to use the Patent Rights and the Intangible
Rights to manufacture the Licensed Products.

<PAGE>

2.2.1. Licensor makes no warranty related to the validity or
enforceability of any of the issued patents included in the Patent Rights.

2.2.2 Licensee may only disclose the Intangible Rights to
third parties if such disclosure is necessary for Licensee to perform its
obligations under this Agreement, PROVIDED, that no disclosure of the
Intangible Rights shall be made by Licensee unless Licensee has obtained
from the third party a signed nondisclosure agreement that affords
Licensor at least the same protection as set forth in PARAGRAPH 8 herein.

2.3. NO TRANSFER. The rights granted under this PARAGRAPH 2 may not
be sublicensed or transferred without the express prior written consent of
Licensor.

3. ROYALTIES AND PAYMENT TERMS

3.1. Licensee shall pay to Licensor the royalty on Annual Net Sales of
Licensed Products as specified in the attached SCHEDULE D. Licensee's
obligation to pay royalties under this Agreement will be triggered by the
invoice date or the shipping date of the Licensed Products, whichever occurs
first. Royalty payments are due thirty (30) days after the end of each
calendar quarter.

3.2. Licensee shall keep accurate and complete records containing all
information required for the computation and verification of the payments due
under Paragraph 3.1. Licensor shall have the right to inspect such records
during Licensee's ordinary business hours to verify the accuracy of any
royalty payments made under this Agreement. If an audit by Licensor uncovers
a deficiency in any royalty payment, Licensee must pay the cost of such audit
and immediately remit the amount due, including a two percent (2.0%) per
month finance charge.

3.3. Any past due royalty payments will carry an interest rate of two
percent (1.5%) per month commencing on the due date and compounding every
thirty (30) days thereafter.

3.4. Within thirty (30) days after the end of each calendar quarter,
Licensee will have paid to Licensor at least the following cumulative royalty
payment amounts:

First Quarter: [*] of the total minimum annual royalty for that year.
Second Quarter: [*] of the total minimum annual royalty for that year.
Third Quarter: [*] of the total minimum annual royalty for that year.
Fourth Quarter: [*] of the total minimum annual royalty for that year.

[*] Redacted Information

<PAGE>

4. QUALITY CONTROL

4.3. Licensee shall permit Licensor or Licensor's appointed agent to
inspect and to monitor Licensee's use of the Trademark Rights including,
without limitation, (a) allowing Licensor or Licensor's appointed agent, at
reasonable times, to review Licensee's advertisements and other materials
using the Trademark Rights, and (b) with reasonable advance notice, to enter
the premises of Licensee, or any premises under the control of Licensee,
where any Licensed Product is manufactured or sold, to inspect the Licensed
Products and the manner in which the Licensed Products are marketed.
Licensee shall also provide, upon request of Licensor, representative samples
of the Licensed Products and any advertising therefor.

4.5. LEVERAGING OF THE TRADEMARK RIGHTS

4.5.1. Subject to approval of Licensor and subject to the
quality control standards set forth herein, Licensee may utilize the
Trademark Rights in conjunction with any marks owned or created by
Licensee, but only to the extent that such use of the Trademark Rights is
reasonably intended to promote the Licensed Products, and only to the
extent that such use does not dilute any of the Trademark Rights.

<PAGE>

promotion, or marketing of the Licensed Products and such New Marks
must be distinctive over all other New Marks that are created by
additional Licensees of Licensor under similar terms. The parties agree
that Licensee's use of such New Marks, including the goodwill arising
from such use, shall inure to the benefit of Licensor, and Licensee shall
have no right whatsoever to the New Marks except as specifically set
forth herein. Licensee agrees to not use the New Marks, or any
simulation or variant thereof, or any mark, name, logo, design, likeness,
or other representation confusingly similar to any of the New Marks,
except as specifically set forth herein.

4.5.3 Licensee agrees to use the New Marks whenever the Cragar
name or logo is used.

4.5.4. Licensee's right to use the Trademark Rights, any marks
derived from or including any of the Trademark Rights, and any New Marks,
as contemplated by this PARAGRAPH 4.5, shall immediately cease upon
termination of this Agreement for any reason.

4.6. Notwithstanding the foregoing, Licensee shall be responsible for
assuring that the Licensed Products sold under this Agreement are free from
defects in materials or workmanship, are of merchantable quality, and are fit
for the purposes intended by Licensee's customers.

5. MARKINGS

5.1. Licensee shall mark each Patented Product and its associated
packaging with the applicable patent number.

5.2. Licensee shall place the trademark registration symbol
"-Registered Trademark-" immediately following each use of a federally
registered trademark included in the Trademark Rights. Licensee shall place
the trademark symbol "-TM-" immediately following each use of a
non-federally-registered trademark included in the Trademark Rights.

5.3. Licensee shall mark each Licensed Product it manufactures with
the actual manufacturing date of such Licensed Product, along with any other
government-mandated, statutory, or other regulatory markings that may be
required. Licensee shall be fully responsible for, and agrees to indemnify
Licensor for, any and all product liability and product warranty claims (and
any associated costs and damages) caused by Licensee's failure to properly
mark the Licensed Products under this Paragraph 5.3.

6. IMPROVEMENTS

<PAGE>

Licensor, which shall not be unreasonably denied by Licensor, before any such
Improvement is incorporated or implemented into any Licensed Product.

7. BEST EFFORTS

7.2. Licensor may request Licensee to prepare a written quarterly
summary of promotional, marketing, and sales activity related to the Licensed
Products.

7.3. If, for any two (2) year period, Licensee does not market and
promote a particular Licensed Product Class, Licensor shall have the right to
exclude from this Agreement any and all products contained in such Licensed
Product Class. Licensor shall have the right to offer the Licensed Rights
for products contained in any excluded Licensed Product Class to any third
party.

7.4. If, for any reason, Licensee ceases to actively market and
promote the Licensed Products for any continuous ninety (90) day period,
Licensee shall promptly notify Licensor and Licensor shall have the right to
immediately terminate this Agreement.

8. CONFIDENTIALITY

8.1. During the term of this Agreement, one party (the "DISCLOSING
PARTY") may disclose to another party (the "RECEIVING PARTY") confidential
information, proprietary information, trade secret information, marketing
data, and the like (hereinafter "CONFIDENTIAL INFORMATION"). The Receiving
Party shall not use or disclose any Confidential Information, except for the
purpose of complying with its obligations under this Agreement.

<PAGE>

8.2. The Receiving Party agrees to keep all Confidential Information
strictly confidential, subject to the limited disclosure to a selected number
of employees as may be reasonably necessary to enable the Receiving Party to
comply with its obligations under this Agreement.

8.3. Upon termination of this Agreement, the Receiving Party shall
return (or destroy if requested by the Disclosing Party) all Confidential
Information in its possession. Notwithstanding the foregoing, the
confidentiality provisions set forth herein shall survive any termination of
this Agreement.

9. INFRINGEMENT

9.1. If either party discovers an infringing use of any of the
Licensed Rights by any third party, the discovering party shall promptly
notify the other party. If Licensor elects to institute an action to end
such third party infringement, Licensee shall provide all reasonable
assistance to Licensor in connection with such action. If Licensor elects to
not institute such an action, Licensee may initiate such action, and Licensor
agrees to provide reasonable assistance to Licensee in connection with such
action.

10. TERM AND TERMINATION

10.1. This Agreement shall have a term of [*] from its effective date,
with perpetual renewal rights. Any renewal of this Agreement shall have a
term of [*].

10.2. At least two hundred seventy (270) days prior to the termination
date of the original Agreement or any subsequently renewed Agreement,
Licensee shall provide written notice to Licensor of Licensee's intent to
terminate or renew the current Agreement.

10.3. If Licensee fails to comply with any of the terms of this
Agreement or of the Agreement of Sale and Purchase of Assets, then Licensee
will be deemed to have defaulted. Upon written notice of such default,
unless otherwise specified herein, Licensee shall have ninety (90) days to
cure such default, otherwise Licensor may immediately terminate this
Agreement.

10.4. In the event of failure, receivership, or seizure of Licensee,
this Agreement shall terminate immediately.

[*] Redacted Information

<PAGE>

10.5. If this Agreement is terminated for any reason, Licensee shall
not be relieved of any duties or obligations owing as of the date of
termination, including without limitation, accounting for any outstanding
royalties, responsibility for product warranties and product liability for
any Licensed Products, and the duty to maintain confidentiality in accordance
with Paragraph 8 herein. Any royalty payments due upon termination of this
Agreement must be paid by Licensee within sixty (60) days of the termination
date.

10.6. Upon termination of this Agreement for any reason, Licensee shall
immediately cease and desist from any use whatsoever of the Licensed Rights.
Licensee or primary lender may, however, liquidate all remaining inventory in
its possession at time of termination, provided that (i) Licensor shall be
given the right of first refusal to purchase any or all of the inventory upon
the same terms as Licensee offers to third parties, (ii) royalties shall be
payable to Licensor on all liquidated inventory. Further, upon termination
of this Agreement for any reason, Licensee shall immediately transfer to
Licensor or destroy, at Licensor's election, any and all documents and things
bearing any mark included within the Trademark Rights.

11. ARBITRATION

Any controversy or claim arising out of or relating to this Agreement,
or its breach, shall be settled by binding arbitration in accordance with the
rules of the American Arbitration Association with all proceedings conducted
in Phoenix, Arizona. Judgement upon the award rendered by the arbitrator(s)
may be entered in any court having competent jurisdiction.

12. MISCELLANEOUS TERMS

12.1. Licensor may assign its rights under this Agreement to any third
party, without prior notice or consent of Licensee.

12.2. Licensee agrees to indemnify and hold Licensor and its officers,
directors, representatives, agents, and employees harmless from and against
any and all liability, damage, loss, or expense, which Licensor may sustain
or incur in any action brought or claim made by any person, organization, or
governmental entity or agency (including Licensee), irrespective of the legal
theory on which such action or claim may be based, to the extent such
liability relates to this Agreement.

<PAGE>

BE CONSTRUED AS A REPRESENTATION MADE OR WARRANTY GIVEN BY LICENSOR THAT THE
PRACTICE BY LICENSEE OF THE LICENSES GRANTED HEREUNDER SHALL NOT INFRINGE THE
PATENT OR TRADRMARK RIGHTS OF ANY THIRD PARTY. IN NO EVENT SHALL LICENSOR,
ITS DIRECTORS, OFFICERS, EMPLYEEES, OR AFFILIATES BE LIABLE FOR INCIDENTAL OR
CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO
PROPERTY OR LOST PROFITS, REGARDLESS OF WHETHER LICENSOR SHALL BE ADVISED,
SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY.

12.4. Subject to PARAGRAPH 2.3 herein, this Agreement shall be binding
upon the successors, assigns, and legal representatives of the parties.

12.5. Any payment, notice, or other communication required or permitted
to be made or given to either party pursuant to this Agreement shall be
sufficiently made or given upon actual receipt if hand-delivered or by
telecopy, or three days after the date of mailing if sent by certified or
registered mail, postage prepaid, addressed to such party at its address set
forth above or to any other address as it shall designate by written notice
to the other party.

12.7. This Agreement shall be governed by, construed, and interpreted
in accordance with the laws of the State of Arizona.

12.8. The failure of any party to exercise any right, power, or remedy
hereunder shall not constitute a waiver thereof, nor shall any single or
partial exercise of any right, power, or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power, or
remedy.

12.9. This Agreement constitutes the entire understanding between the
parties as to the subject matter hereof. No amendments to this
Agreement shall be effective unless in writing and signed by the
parties.

CRAGAR INDUSTRIES, INC., WELD RACING, INC.
a Delaware corporation a Missouri corporation

By: By:
Name:_________________________ Name:_______________________
Title: _______________________ Title:______________________

<PAGE>

SCHEDULE A - LICENSOR'S TRADEMARK RIGHTS

THIS SCHEDULE A ACCOMPANIES THE EXCLUSIVE FIELD OF USE LICENSE
AGREEMENT, EFFECTIVE ________________________________, BETWEEN CRAGAR
INDUSTRIES, INC. ("LICENSOR") AND WELD RACING, INC. ("LICENSEE"). THE
PARTIES AGREE THAT THIS SCHEDULE A MAY NOT BE AMENDED UNLESS SUCH AMENDMENT
IS IN WRITING AND IS SIGNED BY BOTH PARTIES.

LIST ALL APPLICABLE STATE, FEDERAL, AND FOREIGN REGISTERED TRADEMARKS AND
SERVICE MARKS, INCLUDING THE REGISTRATION NUMBERS AND APPROPRIATE EXHIBITS
SHOWING DESIGN MARKS. ALSO LIST ALL APPLICABLE COMMON LAW TRADEMARKS AND
SERVICE MARKS, AND ALL APPLICABLE STATE, FEDERAL, AND FOREIGN TRADEMARK
APPLICATIONS.

- ------------------------------------------------------------------------------
</TABLE>

<PAGE>

SCHEDULE B - LICENSOR'S PATENT RIGHTS

THIS SCHEDULE B ACCOMPANIES THE EXCLUSIVE FIELD OF USE LICENSE
AGREEMENT, EFFECTIVE ________________________________, BETWEEN CRAGAR
INDUSTRIES, INC. ("LICENSOR") AND WELD RACING, INC. ("LICENSEE"). THE
PARTIES AGREE THAT THIS SCHEDULE B MAY NOT BE AMENDED UNLESS SUCH AMENDMENT
IS IN WRITING AND IS SIGNED BY BOTH PARTIES.

NONE

<PAGE>

SCHEDULE C - CRAGAR PRODUCTS

THIS SCHEDULE C ACCOMPANIES THE EXCLUSIVE FIELD OF USE LICENSE
AGREEMENT, EFFECTIVE ________________________________, BETWEEN CRAGAR
INDUSTRIES, INC. ("LICENSOR") AND WELD RACING, INC. ("LICENSEE"). THE
PARTIES AGREE THAT THIS SCHEDULE C MAY NOT BE AMENDED UNLESS SUCH AMENDMENT
IS IN WRITING AND IS SIGNED BY BOTH PARTIES.

The Licensed Product Classes for the License Agreement shall be as
follows:

1. One piece non-cast, wrought aluminum alloy wheels and related
accessories;

2. Two piece aluminum alloy wheels having a non-cast, wrought aluminum
alloy outer rim, and related accessories;

3. Three (or more) piece alloy wheels having non-cast, wrought aluminum
alloy outer rims, and related accessories.

4. Any type of aluminum or magnesium racing wheel built and marketed
for the purposes of racing.

5. Any type of non-cast, wrought aluminum alloy wheel built and
marketed for motorcycles.

For purposes of the License Agreement, the Licensed Products that are
currently part of Licensor's product offering are strictly limited to the
following wheel series (and corresponding accessories). The following wheel
series identification numbers are contained in the Cragar Industries, Inc.
Warehouse Distributor Workbook dated January 1, 1999:

1. 41/42 (Drag Star);
2. 44 (Super Star);
3. 46/47 (Superlite II);
4. 48 (Super Race);
5. 280;
6. 333; and
7. 49 (Super Truck).

<PAGE>

SCHEDULE D - ROYALTY PAYMENTS

This Schedule D accompanies the Exclusive Field of Use License
Agreement, effective ________________________________, between Cragar
Industries, Inc. ("LICENSOR") and Weld Racing, Inc. ("LICENSEE"). The parties
agree that this Schedule D may not be amended unless such amendment is in
writing and is signed by both parties.

1. On the effective date of the License Agreement, Licensee shall
pay to Licensor a royalty prepayment of [*], which is to be applied to future
royalty payments due to Licensor.

2. On the effective date of the License Agreement, Licensee shall
provide to Licensor a non-interest bearing promissory note guaranteed by
Richard G. Weld which will be in the amount of the minimum annual royalty
payment for the second year. Such promissory note shall be updated annually
on or before January 30 of the next year such that the amount of such
promissory note is equal to the minimum annual royalty payment for the next
year. Licensor acknowledges that Licensee may have certain current
obligations with respect to securing Licensee's assets and Licensor will
endeavor to create a secured promissory note that will not adversely impact
the operation of Licensee's business.

3. Licensee agrees to pay Licensor the greater of a minimum annual
royalty of [*] or the amount due under Paragraph 5 below.

4. Until the aggregate royalty paid by Licensee to Licensor under
the License Agreement and any renewals thereof reaches [*], the parties agree
that the minimum annual royalty payment and the percentage royalty rate shall
be determined in accordance with the following table, where "ANNUAL NET
SALES" means the total gross sales price for all Licensed Products sold
during that year less the total gross sales price for all Licensed Products
returned to Licensee during that year, except where warranty returns are paid
for by Licensor as set forth in Paragraph 2.3 of the Agreement of Sale and
Purchase of Assets.

[*] Redacted Information

<PAGE>

[*] [*]

5. [*]

[*] Redacted Information