JPE INC
8-K, 1997-04-30
MOTOR VEHICLE SUPPLIES & NEW PARTS
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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                             ----------------------

                                    FORM 8-K
                                    --------

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



                Date of Report (Date of earliest event reported):
                                 April 16, 1997
                                 --------------


                         Commission File Number 0-22580
                         ------------------------------


                                    JPE, INC.
             (Exact name of registrant as specified in its charter)


                                    Michigan
                 (State or other jurisdiction of Incorporation)


                           900 Victors Way, Suite 140
                               Ann Arbor, MI 48108
          (Address of principal executive offices, including zip code)


                                   38-2958730
                        (IRS Employer Identification No.)
 

                              (313) 662-2323
              (Registrant's telephone number, including area code)


                                 Not Applicable
          (Former name or former address, if changed since last report)

================================================================================

<PAGE>

ITEM 2   ACQUISITION OR DISPOSITION OF ASSETS

     On April 16, 1997 (the "Closing Date"), Dayton Parts, Inc. (the "Company"),
a wholly-owned  subsidiary of JPE, Inc. (the "Registrant"),  acquired all of the
capital stock of Brake,  Axle and Tandem Company  ("BATCO")  pursuant to a Stock
Purchase Agreement (such Stock Purchase Agreement is filed as an exhibit to this
report).  Total  consideration of $5,558,000 was paid plus a potential earn-out,
based on sales, not to exceed $3,910,000 over a period of five years.

     Funds  from  Registrant's   existing  Third  Amended  and  Restated  Credit
Agreement,  as amended on April 16, 1997, with Comerica Bank, and other banks as
participants thereto, were used to finance the transaction.  The acquisition was
effective as of April 15, 1997.

     BATCO,  which was a closely-held  corporation,  is a full line  aftermarket
distributor of  suspension,  brake and wheel parts for the heavy duty and medium
duty truck industry.  Registrant intends to continue to use the purchased assets
in conducting substantially the same business.  Prior to the acquisition,  there
were  no  relationships  between  BATCO  and  Registrant,  any  of  Registrant's
affiliates,  any director or officer of Registrant,  or any associates of any of
Registrant's officers or directors.


ITEM 7   FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS

         (a) and (b)  Financial Statements

     The  Financial  Statements  and  Pro  Forma  Financial  Information  of the
business acquired as described in Item 2 above and required by this Item are not
filed  herewith  because they are  currently  unavailable  to the  Company.  The
Company  intends  to file such  Financial  Statements  and Pro  Forma  Financial
Information  under cover of Form 8-K/A,  as soon as  practicable,  but not later
than June 27, 1997.

         (c)  Exhibits

     2. Stock Purchase  Agreement  dated April 16, 1997 among JPE, Inc.,  Dayton
Parts, Inc. and the Stockholders of Brake, Axle and Tandem Company,  and Indices
to Schedules and Exhibits to such Agreement.

     Registrant agrees to furnish  supplementally a copy of any omitted schedule
or exhibit to the Commission upon request.

<PAGE>

                                   SIGNATURES

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


                                    JPE, INC.


Date:  April 30, 1997               /s/  James J. Fahrner
                                    -----------------------
                                    James J. Fahrner
                                    Vice President and Chief Financial Officer

<PAGE>

                                INDEX TO EXHIBITS


Exhibit                                                                  Page
Number     Description                                                  Number
- ------     -----------                                                  ------

2          Stock Purchase Agreement dated April 16, 1997 among             5
           JPE, Inc., Dayton Parts, Inc., and the Stockholders
           of Brake, Axle and Tandem Company



                                                       

                            STOCK PURCHASE AGREEMENT


                                      AMONG


                                   JPE, INC.,


                               DAYTON PARTS, INC.


                                       AND


                               THE STOCKHOLDERS OF
                         BRAKE, AXLE AND TANDEM COMPANY



                                      Dated

                                 April 16, 1997



<PAGE>

                            STOCK PURCHASE AGREEMENT

Agreement  entered  into on April 16, 1997,  by and among JPE,  Inc., a Michigan
corporation ("JPE"),  Dayton Parts, Inc., a Michigan corporation ("Buyer"),  and
George  Boyd,  John  Martin  Boyd,  Nolan  Boyd,  Nathan  Boyd and R. D.  Garner
(collectively  the  "Sellers").  The  Buyer  and the  Sellers  are  referred  to
collectively herein as the "Parties."

The Sellers in the aggregate own all of the outstanding  capital stock of Brake,
Axle and Tandem Company, a Texas corporation (the "Company").

This Agreement  contemplates a transaction in which the Buyer will purchase from
the  Sellers,  and the Sellers  will sell to the Buyer,  all of the  outstanding
capital stock of the Company in return for cash and contingent payments.

     Now,  therefore,  in  consideration of the premises and the mutual promises
     herein made, and in consideration of the representations,  warranties,  and
     covenants herein contained, the Parties agree as follows:

1.   DEFINITIONS.

     "Accredited Investor" has the meaning set forth in Regulation D promulgated
     under the Securities Act.

     "Adverse  Consequences" means all actions,  suits,  proceedings,  hearings,
     investigations,   charges,   complaints,   claims,  demands,   injunctions,
     judgments,  orders,  decrees,  rulings,  damages,  dues, penalties,  fines,
     costs, amounts paid in settlement, Liabilities,  obligations, Taxes, liens,
     losses, expenses, and fees, including court costs and reasonable attorneys'
     fees and expenses.

     "Affiliate"  has the  meaning  set forth in Rule  12b-2 of the  regulations
     promulgated under the Securities Exchange Act.

     "Affiliated  Group" means any  affiliated  group within the meaning of Code
     Section 1504.

     "Basis" means any past or present fact,  situation,  circumstance,  status,
     condition,  activity, practice, plan, occurrence,  event, incident, action,
     failure  to act,  or  transaction  that  forms the basis for any  specified
     consequence.

     "Buyer" has the meaning set forth in the preface above.

     "Closing" has the meaning set forth in Section 2.4 below.

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

     "Company" has the meaning set forth in the preface above.

     "Company Share" means any share of the Non-Voting  Common Stock,  par value
     $0.10 per  share,  and the Voting  Preferred  Stock,  par value  $12.00 per
     share, of the Company and the rights thereto.

     "Confidential  Information"  means any information  concerning the business
     and affairs of the Company and its Subsidiary that is not already generally
     available to the public.

     "Controlled  Group  of  Corporations"  has the  meaning  set  forth in Code
     Section 1563.

     "Disbursing Agent" has the meaning set forth in Section 2.2 below.

     "Disclosure Schedule" has the meaning set forth in Section 4 below.

     "Employee Benefit Plan" means any (a) nonqualified deferred compensation or
     retirement plan or arrangement  which is an Employee  Pension Benefit Plan,
     (b) qualified defined contribution  retirement plan or arrangement which is
     an Employee Pension Benefit Plan, (c) qualified defined benefit  retirement
     plan or arrangement  which is an Employee  Pension  Benefit Plan (including
     any  Multiemployer  Plan), or (d) Employee Welfare Benefit Plan or material
     fringe benefit plan or program.

     "Employee  Pension Benefit Plan" has the meaning set forth in ERISA Section
     3(2).

     "Employee  Welfare Benefit Plan" has the meaning set forth in ERISA Section
     3(1).

     "Environmental,   Health,   and  Safety   Laws"  means  the   Comprehensive
     Environmental  Response,  Compensation  and  Liability  Act  of  1980,  the
     Resource Conservation and Recovery Act of 1976, and the Occupational Safety
     and  Health  Act of 1970,  each as  amended,  together  with all other laws
     (including  rules,  regulations,  codes,  plans,  injunctions,   judgments,
     orders, decrees, rulings, and charges thereunder) of federal, state, local,
     and foreign governments (and all agencies thereof) concerning  pollution or
     protection of the environment, public health and safety, or employee health
     and safety, including laws relating to emissions,  discharges, releases, or
     threatened releases of pollutants,  contaminants, or chemical,  industrial,
     hazardous,  or toxic  materials or wastes into ambient air,  surface water,
     ground  water,  or  lands  or  otherwise   relating  to  the   manufacture,
     processing,  distribution, use, treatment, storage, disposal, transport, or
     handling of pollutants,  contaminants, or chemical, industrial,  hazardous,
     or toxic materials or wastes.

     "ERISA"  means the Employee  Retirement  Income  Security  Act of 1974,  as
     amended.

     "Extremely Hazardous Substance" has the meaning set forth in Section 302 of
     the Emergency Planning and Community Right-to-Know Act of 1986, as amended.

     "Fiduciary" has the meaning set forth in ERISA Section 3(21).

     "Financial Statement" has the meaning set forth in Section 4.7 below.

     "GAAP" means United States generally accepted  accounting  principles as in
     effect from time to time.

     "Indemnified Party" has the meaning set forth in Section 7.4 below.

     "Indemnifying Party" has the meaning set forth in Section 7.4 below.

     "Intellectual  Property"  means (a) all inventions  (whether  patentable or
     unpatentable  and whether or not  reduced to  practice),  all  improvements
     thereto,  and all patents,  patent  applications,  and patent  disclosures,
     together  with  all  reissuances,   continuations,   continuations-in-part,
     revisions,  extensions,  and  reexaminations  thereof,  (b) all trademarks,
     service  marks,  trade dress,  logos,  trade names,  and  corporate  names,
     together with all translations,  adaptations, derivations, and combinations
     thereof  and  including  all  goodwill   associated   therewith,   and  all
     applications,  registrations and renewals in connection therewith,  (c) all
     copyrightable works, all copyrights,  and all applications,  registrations,
     and  renewals  in  connection  therewith,   (d)  all  mask  works  and  all
     applications,  registrations and renewals in connection therewith,  (e) all
     trade  secrets and  confidential  business  information  (including  ideas,
     research and development,  know-how, formulas, compositions,  manufacturing
     and production processes and techniques, technical data, designs, drawings,
     specifications,  customer and supplier lists, pricing and cost information,
     and business and marketing plans and proposals),  (f) all computer software
     (including  data and  related  documentation),  (g) all  other  proprietary
     rights,  and (h) all copies and tangible  embodiments  thereof (in whatever
     form or medium).

     "Intercompany Transaction" has the meaning set forth in Treas. Reg. Section
     1.1502-13.

     "Knowledge"  means  actual  knowledge  after  reasonable   inquiry  of  Les
     Ballentine, Fred Curtis, Graem Monilaws and Don Petty.

     "Liability" means any liability (whether known or unknown, whether asserted
     or  unasserted,   whether  absolute  or  contingent,   whether  accrued  or
     unaccrued, whether liquidated or unliquidated, and whether due or to become
     due), including any liability for Taxes.

     "Most Recent  Balance Sheet" means the balance sheet  contained  within the
     Most Recent Financial Statements.

     "Most Recent Financial Statements" has the meaning set forth in Section 4.7
     below.

     "Most  Recent  Fiscal  Month End" has the  meaning set forth in Section 4.7
     below.

     "Most  Recent  Fiscal  Year End" has the  meaning  set forth in Section 4.7
     below.

     "Multiemployer Plan" has the meaning set forth in ERISA Section 3(37).

     "Ordinary  Course of  Business"  means  the  ordinary  course  of  business
     consistent  with past  custom  and  practice  (including  with  respect  to
     quantity and frequency).

     "Party" has the meaning set forth in the preface above.

     "PBGC" means the Pension Benefit Guaranty Corporation.

     "Person" means an individual, a partnership, a corporation, an association,
     a joint  stock  company,  a  trust,  a  joint  venture,  an  unincorporated
     organization,  or a  governmental  entity (or any  department,  agency,  or
     political subdivision thereof).

     "Prohibited Transaction" has the meaning set forth in ERISA Section 406 and
     Code Section 4975.

     "Purchase Price" has the meaning set forth in Section 2.2 below.

     "Reportable Event" has the meaning set forth in ERISA Section 4043.

     "Securities Act" means the Securities Act of 1933, as amended.

     "Securities  Exchange  Act" means the  Securities  Exchange Act of 1934, as
     amended.

     "Security Interest" means any mortgage, pledge, lien, encumbrance,  charge,
     or other security interest, other than (a) mechanic's,  materialmen's,  and
     similar  liens,  (b) liens for Taxes not yet due and payable,  (c) purchase
     money  liens  and  liens  securing  rental  payments  under  capital  lease
     arrangements,  and (d)  other  liens  arising  in the  Ordinary  Course  of
     Business and not incurred in connection with the borrowing of money.

     "Seller" has the meaning set forth in the preface above.

     "Subsidiary" means any corporation with respect to which a specified Person
     (or a  Subsidiary  thereof)  owns a majority of the common stock or has the
     power to vote or direct  the  voting of  sufficient  securities  to elect a
     majority of the directors.

     "Tax" means any federal,  state, local, or foreign income,  gross receipts,
     license,  payroll,   employment,   excise,  severance,  stamp,  occupation,
     premium,  windfall  profits,  environmental  (including  taxes  under  Code
     Section  59A),   customs  duties,   capital  stock,   franchise,   profits,
     withholding, social security (or similar),  unemployment,  disability, real
     property,  personal  property,  sales, use, transfer,  registration,  value
     added.  alternative or add-on minimum,  estimated, or other tax of any kind
     whatsoever,  including any interest,  penalty, or addition thereto, whether
     disputed or not.

     "Tax Return" means any return,  declaration,  report,  claim for refund, or
     information return or statement  relating to Taxes,  including any schedule
     or attachment thereto, and including any amendment thereof.

     "Third Party Claim" has the meaning set forth in Section 7.4 below.

2.   PURCHASE AND SALE OF COMPANY SHARES.

     2.1  Basic Transaction.  On and subject to the terms and conditions of this
          Agreement,  the Buyer agrees to purchase from each of the Sellers, and
          each of the  Sellers  agrees to sell to the  Buyer,  all of his or its
          Company Shares for the  consideration  specified below in this Section
          2.

     2.2  Purchase Price. The purchase price (the "Purchase Price") will consist
          of and JPE shall cause Buyer to pay to Mike Kirkpatrick, as disbursing
          agent for the Sellers ("Disbursing Agent"), as follows:

          (a)  Cash Payment. At the Closing, cash in the amount of $2,250,000.

          (b)  Covenant Note to Compete.  Payment of $250,000 in cash at closing
               to  George  Boyd for a  covenant  not to  compete  in the form of
               Exhibit 2.2(b).

          (c)  Severance  Agreements.  Assumption of (i) severance  obligations,
               but not the one-time  incentive  bonus,  contained in  agreements
               with James  Butler,  Fred Curtis,  Graem  Monilaws and Don Petty,
               attached hereto as Exhibit 2.2(c)(i),  (ii) severance obligations
               with  other   employees   as   generally   described  in  Exhibit
               2.2(c)(ii), provided that such employees do not voluntarily leave
               the employ of the Company  prior to their  specified  termination
               date, and (iii) the severance  agreement  dated December 20, 1996
               with Nathan Boyd  including the  reimbursement  to Sellers of the
               amount,  if any,  paid to Nathan Boyd prior to Closing;  provided
               that the total  obligation  created  by Nathan  Boyd's  severance
               agreement does not exceed $100,000 in the aggregate, and that the
               remaining  payments  continue  to be made in equal  amounts  on a
               monthly basis.

          (d)  Contingent  Payments.  Subject  to the  adjustments  provided  in
               Section 2.3,  contingent  payments  (the  "Contingent  Payments")
               based on annual  sales (net of cash  discounts  and  returns  but
               before  rebates and  freight) of the product line  categories  as
               described  in Exhibit  2.2(d)(1)  in excess of the  target  sales
               ("Target Sales"), as set forth below, by Buyer or its affiliates,
               including, but not limited to, the Company.

               The Contingent Payments to Sellers shall be made for the first to
               occur of sales  through June 30, 2002 or  Contingent  Payments in
               the aggregate of $4 million.  The  Contingent  Payments  shall be
               made on August 15 of each year at the following rates and for the
               five (5)  consecutive  twelve  month  periods  starting  with the
               twelve-month  period  July 1,  1997  through  June 30,  1998,  as
               follows:

                Period July 1         Target Sales              Percentage
               through June 30       ($ in millions)       Rate on Excess Sales
               ---------------       ---------------       --------------------
                   Year 1                 30.6                      7%
                   Year 2                 30.978                   10
                   Year 3                 31.367                    8
                   Year 4                 31.768                    7
                   Year 5                 32.181                    6

               An example of the Contingent Payment  calculation is set forth on
               Exhibit  2.2(d)(3).  Such example is provided as a forecast only,
               and Buyer does not represent or guarantee  that the sales numbers
               reflected on Exhibit  2.2(d)(3) can or will be achieved and shall
               have no liability to Sellers for such forecast.

               On  a  quarterly  basis,   concurrent  with  JPE,  Inc.'s  public
               reporting requirements, Buyer shall furnish a designated Seller a
               report of sales of the Company's products for such quarter.

               No more than once per year,  Sellers  may audit  Buyer's  records
               supporting  the sales for the  Contingent  Payments.  Such  audit
               shall be performed  during Buyer's normal business hours and upon
               reasonable notice to Buyer.  Sellers' audit shall be conducted at
               Sellers' sole cost and expense;  provided,  however, in the event
               such audit  results in a variance in the sales  number of greater
               than  ten  percent  (10%),  Buyer  shall be  responsible  for the
               reasonable expenses of Sellers' audit.

          (e)  Other. Such other payments as may be set forth in Exhibit 2.2(e).

     2.3  Adjustments to the Purchase Price. Subject to the adjustments provided
          in this Section,  the Purchase Price, based upon the December 28, 1996
          audited  balance  sheet  attached as Exhibit  2.3 as adjusted  for the
          consolidation  of  the  Tufco  assets  (the  "Balance   Sheet"),   the
          Contingent  Payment  portion of the Purchase Price will be adjusted as
          follows:

          (a)  Adjustment.  Post  closing,  Buyer shall cause a balance sheet of
               the Company as of the April 15,  1997 (the  "Closing
               Date  Balance  Sheet") to be prepared  based upon the taking of a
               physical  inventory of the Company and its  Subsidiary,  starting
               prior to Closing and completed promptly following Closing.  Buyer
               may,  if it  chooses,  at its sole  expense,  have  its  auditors
               observe the taking of the  physical  inventory,  and, at its sole
               discretion  and  expense,  have the Closing  Date  Balance  Sheet
               reviewed by its auditors ("Buyer's  Accountants").  The Company's
               accounting  department  shall  prepare the Closing  Date  Balance
               Sheet  in  accordance  with  United  States  Generally   Accepted
               Accounting Principles ("GAAP")  consistently  applied,  utilizing
               the same  accounting  principles  and past  practices used by the
               Company in preparing  the Financial  Statements,  as adjusted for
               the  consolidation  of the Tufco  assets  and  liabilities,  and,
               following  review by Buyer's  Accountants,  Buyer  shall  deliver
               final copies thereof to Sellers within ninety (90) days following
               the Closing.  Sellers agree to cooperate with Buyer in connection
               with their  preparation  of the Closing Date Balance  Sheet as is
               customary and  appropriate in the preparation of a balance sheet.
               Sellers  shall have thirty (30) days  following  their receipt of
               the Closing Date Balance  Sheet in which to object  thereto.  Any
               objection   shall  be  accompanied  by  a  letter  from  Sellers'
               Accountants   specifying  in  reasonable  detail  the  basis  for
               Sellers' objections and attesting to the fact that such objection
               is  reasonable.  If  Sellers  and Buyer are  unable to agree to a
               resolution of the differences  within thirty (30) days after such
               objection,  the Closing Date Balance Sheet will be submitted to a
               neutral arbitrator (the "Arbitrator"),  who shall be a partner of
               a "Big Six" accounting firm with an office in Dallas,  Texas, for
               a final  and  binding  arbitration.  The  Arbitrator's  fees  and
               expenses shall be allocated by the Arbitrator between Sellers and
               Buyer in the Arbitrator's sole discretion.

          (b)  Final Purchase  Price.  The "Final  Purchase  Price" shall be the
               Purchase Price adjusted,  upwards or downwards, by the difference
               between the net of the Assets less the  liabilities  reflected in
               the Closing Date Balance Sheet (as finally  agreed upon by Seller
               and Buyer or as determined by the  Arbitrator) and the comparable
               numbers shown on the Balance Sheet.

          (c)  Payments.  The Contingent  Payment amount otherwise owed by Buyer
               to Sellers  shall be  reduced,  starting  with the payment due on
               August 15, 1998 and continuing  each year  thereafter  until such
               reductions as required by Section  2.3(b) above are paid in full.
               Buyer  shall  pay to the  Disbursing  Agent any  increase  in the
               Purchase Price as calculated pursuant to Section 2.3(b) above, in
               full, in U.S. funds on August 15, 1998.

     2.4  The  Closing.  The closing of the  transactions  contemplated  by this
          Agreement (the  "Closing")  shall take place at the offices of Munsch,
          Hardt, Kopf, Harr & Dinan, P.C. in Dallas,  Texas,  commencing at 9:00
          a.m. local time upon the  satisfaction  or waiver of all conditions to
          the  obligations  of  the  Parties  to  consummate  the   transactions
          contemplated hereby (other than conditions with respect to actions the
          respective Parties will take at the Closing itself) or such other date
          as the Buyer and the  Sellers may  mutually  determine  (the  "Closing
          Date");  provided,  however,  that the Closing  Date shall be no later
          than April 16, 1997.

     2.5  Deliveries  at the  Closing.  At the  Closing,  (i) the  Sellers  will
          deliver  to the  Buyer  the  various  certificates,  instruments,  and
          documents  referred  to in  Section  6.1  below,  (ii) the Buyer  will
          deliver to the  Sellers  the various  certificates,  instruments,  and
          documents  referred to in Section 6.2 below, (iii) each of the Sellers
          will deliver to the Buyer stock  certificates  representing all of his
          or its  Company  Shares,  endorsed  in  blank or  accompanied  by duly
          executed assignment documents,  and (iv) the Buyer will deliver to the
          Disbursing Agent the consideration specified in Section 2.2 above.

3.   REPRESENTATIONS AND WARRANTIES CONCERNING THE TRANSACTION.

     3.1  Representations  and  Warranties  of the Sellers.  Each of the Sellers
          represents and warrants to the Buyer that the statements  contained in
          this  Section  3.1 are  correct  and  complete  as of the date of this
          Agreement  and will be correct and complete as of the Closing Date (as
          though made then and as though the Closing Date were  substituted  for
          the date of this  Agreement  through this Section 3.1) with respect to
          himself  only,  except as set  forth in the  Disclosure  Schedule  (as
          defined below) attached hereto.

          (a)  Authorization  of  Transaction.  The  Seller  has full  power and
               authority  to execute and deliver this  Agreement  and to perform
               his obligations  hereunder.  This Agreement constitutes the valid
               and legally  binding  obligation  of the Seller,  enforceable  in
               accordance  with its terms and  conditions.  The Seller  need not
               give  any  notice  to,  make  any  filing  with,  or  obtain  any
               authorization,   consent,   or  approval  of  any  government  or
               governmental  agency  in order  to  consummate  the  transactions
               contemplated by this Agreement.

          (b)  Brokers'  Fees.  Except  for the fees of Pate,  Winters  & Stone,
               Inc.,  the Seller has no Liability or  obligation to pay any fees
               or  commissions to any broker,  finder,  or agent with respect to
               the  transactions  contemplated  by this  Agreement for which the
               Buyer could become liable or obligated.

          (c)  Company Shares.  The Seller holds of record and owns beneficially
               or the rights to acquire  the number of Company  Shares set forth
               next  to  his or  its  name  in  Section  4.2  of the  Disclosure
               Schedule,  free and clear of any  restrictions on transfer (other
               than  any  restrictions   under  the  Securities  Act  and  state
               securities laws), Taxes, Security Interests,  options,  warrants,
               purchase rights,  contracts,  commitments,  equities,  claims and
               demands.  The  Seller  is not a  party  to any  option,  warrant,
               purchase  right,  or other  contract  or  commitment  that  could
               require the Seller to sell, transfer, or otherwise dispose of any
               capital  stock of the Company  (other than this  Agreement).  The
               Seller  is not a party  to any  voting  trust,  proxy,  or  other
               agreement  or  understanding  with  respect  to the voting of any
               capital stock of the Company.

     3.2  Representations and Warranties of the Buyer and JPE. The Buyer and JPE
          represent and warrant to the Sellers that the statements  contained in
          this  Section  3.2 are  correct  and  complete  as of the date of this
          Agreement  and will be correct and complete as of the Closing Date (as
          though made then and as though the Closing Date were  substituted  for
          the date of this Agreement throughout this Section 3.2).

          (a)  Organization of the Buyer and JPE. Each of the Buyer and JPE is a
               corporation  duly  organized,   validly  existing,  and  in  good
               standing under the laws of the State of Michigan.

          (b)  Authorization of Transaction.  Each of the Buyer and JPE has full
               power and authority (including full corporate power and authority
               and authorizing resolutions of its Board of Directors) to execute
               and  deliver  this  Agreement  and  to  perform  its  obligations
               hereunder.  This  Agreement  constitutes  the valid  and  legally
               binding   obligation  of  the  Buyer  and  JPE,   enforceable  in
               accordance with its terms and  conditions.  Neither the Buyer nor
               JPE need give any notice to, make any filing with,  or obtain any
               authorization,   consent,   or  approval  of  any  government  or
               governmental  agency  in order  to  consummate  the  transactions
               contemplated by this Agreement.

          (c)  Noncontravention.  Neither the execution and the delivery of this
               Agreement, nor the consummation of the transactions  contemplated
               hereby, will (i) violate any constitution,  statute,  regulation,
               rule,  injunction,  judgment,  order, decree,  ruling, charge, or
               other  restriction of any  government,  governmental  agency,  or
               court  to  which  either  the  Buyer  or  JPE is  subject  or any
               provision of its charter or bylaws or (ii) result in a breach of,
               constitute a default under, result in the acceleration of, create
               in any party  the  right to  accelerate,  terminate,  modify,  or
               cancel,  or require  any notice  under any  agreement,  contract,
               lease, license, instrument, or other arrangement, to which either
               the  Buyer  or JPE is a party or by which it is bound or to which
               any of its assets is subject.

          (d)  Brokers'  Fees.  Neither the Buyer nor JPE has any  Liability  or
               obligation to pay any fees or commissions to any broker,  finder,
               or agent with respect to the  transactions  contemplated  by this
               Agreement for which any Seller could become liable or obligated.

          (e)  Investment.  Buyer (i)  understands  that the Company Shares have
               not been, and will not be,  registered  under the Securities Act,
               or under any state  securities  laws,  and are being  offered and
               sold  in  reliance   upon  federal  and  state   exemptions   for
               transactions not involving a public  offering;  (ii) is acquiring
               the Company  Shares  solely for its own  account  for  investment
               purposes,  and not with a view to the distribution thereof; (iii)
               is a  sophisticated  investor with  knowledge  and  experience in
               business and financial matters; (iv) is able to bear the economic
               risk  and lack of  liquidity  inherent  in  holding  the  Company
               Shares; and (v) is an Accredited Investor.

          (f)  Financing.  Buyer has adequate cash resources or commitments  for
               financing to perform its obligations under this Agreement.

          (g)  Litigation. There are no suits, actions or legal, administrative,
               arbitration or other  proceedings or governmental  investigations
               against  either  Buyer or JPE  pending  or, to either  Buyer's or
               JPE's knowledge, threatened, which (i) if determined adversely to
               either  Buyer or JPE,  could be  expected to result in a material
               adverse   effect  on  the  financial   condition  or  results  of
               operations  of Buyer  and JPE  taken as a whole,  or (ii) seek to
               prevent the consummation of the transaction.

4.   REPRESENTATIONS  AND WARRANTIES  CONCERNING THE COMPANY AND BRAKE, AXLE AND
     TANDEM  COMPANY  CANADA  INC.  ("SUBSIDIARY").  The Sellers  represent  and
     warrant to the Buyer that the  statements  contained  in this Section 4 are
     correct and complete as of the date of this  Agreement  and will be correct
     and  complete as of the Closing Date (as though made then and as though the
     Closing Date were  substituted  for the date of this  Agreement  throughout
     this Section 4), except as set forth in the disclosure  schedule  delivered
     by the Sellers to the Buyer on the date hereof and initialed by the Parties
     (the "Disclosure  Schedule").  Nothing in the Disclosure  Schedule shall be
     deemed  adequate to disclose an exception to a  representation  or warranty
     made  herein,  however,  unless  the  Disclosure  Schedule  identifies  the
     exception with reasonable particularity and describes the relevant facts in
     reasonable  detail.  Without limiting the generality of the foregoing,  the
     mere listing (or inclusion of a copy) of a document or other item shall not
     be deemed adequate to disclose an exception to a representation or warranty
     made herein  (unless  the  representation  or  warranty  has to do with the
     existence of the document or other item itself).  The  Disclosure  Schedule
     will be arranged in paragraphs  corresponding  to the lettered and numbered
     paragraphs contained in this Section 4.

     4.1  Organization,  Qualification, and Corporate Power. Each of the Company
          and its Subsidiary is a corporation duly organized,  validly existing,
          and in  good  standing  under  the  laws  of the  jurisdiction  of its
          incorporation.  Each  of  the  Company  and  its  Subsidiary  is  duly
          authorized to conduct  business and is in good standing under the laws
          of each jurisdiction where such qualification is required except where
          the  lack of such  qualification  would  not have a  material  adverse
          effect on the business,  financial condition,  operations,  results of
          operations,  or future  prospects  of the Company  and its  Subsidiary
          taken as a whole.  Each of the  Company  and its  Subsidiary  has full
          corporate  power  and  authority  and  all  licenses,   permits,   and
          authorizations  necessary  to  carry  on the  business  in which it is
          engaged  and to own and  use  the  properties  owned  and  used by it.
          Section  4.1  of the  Disclosure  Schedule  lists  the  directors  and
          officers of each of the Company and its  Subsidiary.  The Sellers have
          delivered to the Buyer correct and complete  copies of the charter and
          bylaws of each of the Company and its Subsidiary (as amended to date).
          The  minute  books   (containing   the  records  of  meetings  of  the
          stockholders,  the board of directors, and any committees of the board
          of directors), the stock certificate books, and the stock record books
          of each of the Company and its  Subsidiary  are correct and  complete.
          Neither of the Company nor its  Subsidiary  is in default  under or in
          violation of any provision of its charter or bylaws.

     4.2  Capitalization.  The entire  authorized  capital  stock of the Company
          consists of 500,000 shares of Non-Voting Common Stock, of which 88,000
          shares  are  issued  and  outstanding  and  12,000  shares are held in
          treasury and 500,000 shares of Voting  Preferred  Stock,  of which one
          (1) share is issued and  outstanding,  93,999 rights to acquire shares
          and 6,000 rights to acquire  shares are held in  treasury.  All of the
          issued and outstanding  Company Shares have been duly authorized,  are
          validly issued, fully paid, and nonassessable,  and are held of record
          by  the  respective  Sellers  as  set  forth  in  Section  4.2  of the
          Disclosure   Schedule.   Except  as  described  above,  there  are  no
          outstanding  or  authorized   options,   warrants,   purchase  rights,
          subscription  rights,  conversion  rights,  exchange rights,  or other
          contracts  or  commitments  that could  require  the Company to issue,
          sell,  or  otherwise  cause to become  outstanding  any of its capital
          stock.  There are no  outstanding  or authorized  stock  appreciation,
          phantom stock, profit participation, or similar rights with respect to
          the Company. There are no voting trusts,  proxies, or other agreements
          or  understandings  with respect to the voting of the capital stock of
          the Company.

     4.3  Noncontravention.  Neither  the  execution  and the  delivery  of this
          Agreement,  nor  the  consummation  of the  transactions  contemplated
          hereby, will (i) violate any constitution,  statute, regulation, rule,
          injunction,   judgment,   order,  decree,  ruling,  charge,  or  other
          restriction of any government,  governmental agency, or court to which
          the  Company or its  Subsidiary  is subject  or any  provision  of the
          charter or bylaws of the Company or its  Subsidiary  or (ii)  conflict
          with, result in a breach of, constitute a default under, result in the
          acceleration  of,  create  in  any  party  the  right  to  accelerate,
          terminate,  modify,  or  cancel,  or  require  any  notice  under  any
          agreement,  contract, lease, license, instrument, or other arrangement
          to which the  Company or its  Subsidiary  is a party or by which it is
          bound or to which  any of its  assets  is  subject  (or  result in the
          imposition  of any Security  Interest  upon any of its assets)  except
          where  the  violation,  breach,  default,  acceleration,  termination,
          modification, cancellation, or failure to give notice would not have a
          material  adverse  effect  on  the  business,   financial   condition,
          operations,  results of operations, or future prospects of the Company
          and its  Subsidiary  taken as a whole.  Neither  the  Company  nor its
          Subsidiary  needs to give any notice  to,  make any  filing  with,  or
          obtain any  authorization,  consent,  or approval of any government or
          governmental  agency  in  order  for the  Parties  to  consummate  the
          transactions  contemplated by this Agreement  except where the failure
          to give notice,  to file, or to obtain any  authorization,  consent or
          approval  would not have a material  adverse  effect on the  business,
          financial  condition,  operations,  results of  operations,  or future
          prospects of the Company and its Subsidiary taken as a whole.

     4.4  Brokers'  Fees.  Except as  provided  in Section  3.1(b),  neither the
          Company nor its  Subsidiary has any Liability or obligation to pay any
          fees or  commissions to any broker,  finder,  or agent with respect to
          the transactions contemplated by this Agreement.

     4.5  Title  to  Assets.  The  Company  and its  Subsidiary  have  good  and
          indefeasible   title  to,  or  a  valid  leasehold  interest  in,  the
          properties  and assets used by them,  located on their  premises other
          than personal property owned by employees or officers, or shown on the
          Most Recent Balance Sheet or acquired after the date thereof, free and
          clear of all  Security  Interests,  except for  properties  and assets
          disposed of in the Ordinary  Course of Business  since the date of the
          Most Recent Balance Sheet.

     4.6  Subsidiary.  Section 4.6 of the Disclosure Schedule sets forth for the
          Subsidiary (i) its name and  jurisdiction of  incorporation,  (ii) the
          number of  shares of  authorized  capital  stock of each  class of its
          capital stock,  (iii) the number of issued and  outstanding  shares of
          each class of its capital stock, the names of the holders thereof, and
          the number of shares held by each such holder,  and (iv) the number of
          shares of its capital  stock held in  treasury.  All of the issued and
          outstanding  shares of capital stock of the Subsidiary  have been duly
          authorized and are validly issued, fully paid, and nonassessable.  The
          Company holds of record and owns  beneficially  all of the outstanding
          shares  of the  Subsidiary,  free  and  clear of any  restrictions  on
          transfer (other than  restrictions  under the Securities Act and state
          securities  laws),  Taxes,  Security  Interests,   options,  warrants,
          purchase  rights,  contracts,   commitments,   equities,  claims,  and
          demands.  There are no  outstanding or authorized  options,  warrants,
          purchase  rights,   conversion  rights,   exchange  rights,  or  other
          contracts  or  commitments  that could  require  the  Company to sell,
          transfer,  or otherwise dispose of any capital stock of the Subsidiary
          or that could  require the  Subsidiary  to issue,  sell,  or otherwise
          cause to become outstanding any of its own capital stock. There are no
          outstanding stock appreciation,  phantom stock, profit  participation,
          or similar rights with respect to the Subsidiary.  There are no voting
          trusts, proxies, or other agreements or understandings with respect to
          the voting of any capital stock of the Subsidiary. Neither the Company
          nor its Subsidiary  controls  directly or indirectly or has any direct
          or indirect  equity  participation  in any  corporation,  partnership,
          trust, or other business  association which is not a Subsidiary of the
          Company.

     4.7  Financial Statements. Attached hereto as Exhibit 4.7 are the following
          financial statements  (collectively the "Financial  Statements"):  (i)
          audited consolidated balance sheets and statements of income,  changes
          in stockholders'  equity, and cash flow as of and for the fiscal years
          ended December 31, 1994, December 31, 1995, and December 28, 1996 (the
          "Most Recent Fiscal Year End") for the Company and its Subsidiary; and
          (ii) unaudited  consolidated  balance sheets and statements of income,
          changes  in  stockholders'  equity,  and cash flow (the  "Most  Recent
          Financial  Statements") as of and for the three months ended March 29,
          1997 (the "Most  Recent  Fiscal  Month  End") for the  Company and its
          Subsidiary.  The Financial  Statements  (including  the notes thereto)
          have been  prepared in  accordance  with GAAP  applied on a consistent
          basis  throughout  the periods  covered  thereby,  present  fairly the
          financial condition of the Company and its Subsidiary as of such dates
          and the results of  operations of the Company and its  Subsidiary  for
          such periods,  are correct and complete,  and are consistent  with the
          books and records of the Company and its  Subsidiary  (which books and
          records are correct and complete);  provided,  however,  that the Most
          Recent Financial Statements are subject to normal year-end adjustments
          (which will not be material individually or in the aggregate) and lack
          footnotes and other presentation items.

     4.8  Events  Subsequent  to Most  Recent  Fiscal  Year End.  Since the Most
          Recent Fiscal Year End, there has not been any material adverse change
          in the  business,  financial  condition,  operations,  or  results  of
          operations of the Company and its Subsidiary taken as a whole. Without
          limiting the generality of the foregoing, since that date:

          (a)  neither  the  Company  nor  its  Subsidiary  has  sold,   leased,
               transferred,   or  assigned  any  of  its  assets,   tangible  or
               intangible,  other than for a fair  consideration in the Ordinary
               Course of Business;

          (b)  neither  the  Company nor its  Subsidiary  has  entered  into any
               agreement,  contract,  lease,  or  license  (or series of related
               agreements,  contracts,  leases,  and licenses)  either involving
               more than $5,000 or outside the Ordinary Course of Business;

          (c)  no  party   (including  the  Company  and  its   Subsidiary)  has
               accelerated,  terminated,  modified,  or canceled any  agreement,
               contract,  lease,  or license  (or series of related  agreements,
               contracts,  leases,  and licenses)  involving more than $5,000 to
               which the Company or its Subsidiary is a party or by which any of
               them is bound, except in the Ordinary Course of Business;

          (d)  neither the Company nor its  Subsidiary  has imposed any Security
               Interest upon any of its assets, tangible or intangible;

          (e)  neither  the  Company  nor its  Subsidiary  has made any  capital
               expenditure  (or series of related capital  expenditures)  either
               involving  more than  $5,000 or outside  the  Ordinary  Course of
               Business;

          (f)  neither  the  Company  nor its  Subsidiary  has made any  capital
               investment in, any loan to, or any  acquisition of the securities
               or assets  of, any other  Person  (or  series of related  capital
               investments, loans, and acquisitions);

          (g)  neither the Company nor its Subsidiary has issued any note, bond,
               or  other  debt  security  or  created,  incurred,   assumed,  or
               guaranteed  any  indebtedness  for borrowed  money or capitalized
               lease  obligation  either  involving  more than $2,000  singly or
               $25,000 in the aggregate;

          (h)  neither the Company nor its  Subsidiary  has delayed or postponed
               the payment of  accounts  payable  and other  Liabilities  beyond
               sixty (60) days from the date of the invoices;

          (i)  neither the Company nor its Subsidiary has canceled, compromised,
               waived,  or  released  any right or claim (or  series of  related
               rights and claims)  either  involving more than $2,500 or outside
               the Ordinary Course of Business;

          (j)  neither the Company nor its Subsidiary has granted any license or
               sublicense   of  any  rights   under  or  with   respect  to  any
               Intellectual Property;

          (k)  there has been no change  made or  authorized  in the  charter or
               bylaws of either the Company or its Subsidiary;

          (l)  neither the  Company nor its  Subsidiary  has  issued,  sold,  or
               otherwise  disposed of any of its capital  stock,  or granted any
               options,   warrants,  or  other  rights  to  purchase  or  obtain
               (including  upon  conversion,  exchange,  or exercise) any of its
               capital stock;

          (m)  neither the Company nor its Subsidiary  has declared,  set aside,
               or paid any dividend or made any distribution with respect to its
               capital  stock   (whether  in  cash  or  in  kind)  or  redeemed,
               purchased, or otherwise acquired any of its capital stock;

          (n)  neither  the  Company  nor its  Subsidiary  has  experienced  any
               damage,   destruction,   or  loss  (whether  or  not  covered  by
               insurance) to any of its material property;

          (o)  neither the Company nor its  Subsidiary  has made any loan to, or
               entered into any other  transaction  with,  any of its directors,
               officers, employees and shareholders;

          (p)  neither  the  Company nor its  Subsidiary  has  entered  into any
               employment contract or collective bargaining  agreement,  written
               or oral,  or modified the terms of any existing  such contract or
               agreement;

          (q)  neither the Company nor its  Subsidiary  has granted any increase
               in the base compensation of any of its directors,  officers,  and
               employees;

          (r)  except as  contemplated  by Section 5.5,  neither the Company nor
               its Subsidiary has adopted, amended,  modified, or terminated any
               bonus,  profit-sharing,  incentive,  severance,  or  other  plan,
               contract,  or commitment for the benefit of any of its directors,
               officers, and employees (or taken any such action with respect to
               any other Employee Benefit Plan);

          (s)  neither the Company nor its  Subsidiary has made any other change
               in  employment  terms  for any of its  directors,  officers,  and
               employees;

          (t)  neither  the Company  nor its  Subsidiary  has made or pledged to
               make any charitable or other capital contribution;

          (u)  there  has  not  been  any  other  material  occurrence,   event,
               incident,  action,  failure to act,  or  transaction  outside the
               Ordinary Course of Business  involving  either the Company or its
               Subsidiary; and

          (v)  neither the Company nor its  Subsidiary  has  committed to any of
               the foregoing.

     4.9  Undisclosed  Liabilities.  Neither the Company nor its  Subsidiary has
          any Liability (and there is no Basis for any present or future action,
          suit, proceeding, hearing, investigation, charge, complaint, claim, or
          demand against any of them giving rise to any  Liability),  except for
          (i) Liabilities set forth on the face of the Most Recent Balance Sheet
          (or in any notes thereto),  (ii)  Liabilities  which have arisen after
          the Most Recent  Fiscal Month End in the  Ordinary  Course of Business
          (none of which  results  from,  arises out of,  relates  to, is in the
          nature  of,  or was  caused  by any  breach  of  contract,  breach  of
          warranty, tort, infringement,  or violation or law), (iii) Liabilities
          disclosed  in  the  Disclosure  Schedule  or  (iv)  Liabilities  under
          contracts, purchase orders and other agreements or arrangements of the
          type required to be disclosed on a schedule  hereto but because of the
          dollar amount or other qualification are not required to be listed.

     4.10 Legal Compliance.  Each of the Company and its Subsidiary has complied
          with all applicable laws (including rules, regulations,  codes, plans,
          injunctions,   judgments,   orders,  decrees,   rulings,  and  charges
          thereunder) of federal, state, local, and foreign governments (and all
          agencies  thereof),   and  no  action,  suit,   proceeding,   hearing,
          investigation,  charge,  complaint,  claim, demand, or notice has been
          filed or commenced against any of them alleging any failure to comply.

     4.11 Tax Matters.

          (a)  Each of the Company and its  Subsidiary has filed all Tax Returns
               that it was  required  to  file,  and has paid  all  Taxes  shown
               thereon as owing.  All such Tax Returns were correct and complete
               in all  respects.  All other  Taxes owed by the  Company  and its
               Subsidiary have been paid. Neither the Company nor its Subsidiary
               currently  is the  beneficiary  of any  extension  of time within
               which to file any Tax  Return.  No claim has ever been made by an
               authority in a  jurisdiction  where the Company or its Subsidiary
               does  not  file  Tax  Returns  that  it is or may be  subject  to
               taxation by that jurisdiction. There are no Security Interests on
               any of the assets of the Company or its Subsidiary  that arose in
               connection with any failure (or alleged failure) to pay any Tax.

          (b)  Each of the Company and its  Subsidiary has withheld and paid all
               Taxes required to have been withheld and paid, in connection with
               amounts paid or owing to any  employee,  independent  contractor,
               creditor, stockholder, or other third party.

          (c)  There is no dispute or claim  concerning any Tax Liability of the
               Company or its  Subsidiary  either  (i)  claimed or raised by any
               authority  in writing or (ii) as to which any of the  Sellers and
               the directors and officers of the Company and its  Subsidiary has
               Knowledge  based  upon  personal  contact  with any agent of such
               authority.  Section  4.11 of the  Disclosure  Schedule  lists all
               federal,  state, local, and foreign income Tax Returns filed with
               respect to the Company  and its  Subsidiary  for taxable  periods
               ended on or after December 31, 1993,  indicates those Tax Returns
               that have been  audited,  and  indicates  those Tax Returns  that
               currently are the subject of audit. The Sellers have delivered to
               the Buyer  correct and  complete  copies of all  federal,  state,
               local and foreign income Tax Returns,  examination  reports,  and
               statements of deficiencies  assessed  against or agreed to by the
               Company or its Subsidiary since December 31, 1993.

          (d)  Neither the Company nor its  Subsidiary has waived any statute of
               limitations  in  respect of Taxes or agreed to any  extension  of
               time with respect to a Tax assessment or deficiency.

          (e)  Neither the Company nor its  Subsidiary has filed a consent under
               Code Section 341(f) concerning collapsible corporations.  Neither
               the  Company  nor  its  Subsidiary  has  made  any  payments,  is
               obligated to make any  payments,  or is a party to any  agreement
               that under certain  circumstances  could  obligate it to make any
               payments  that will not be  deductible  under Code Section  280G.
               Each of the  Company  and its  Subsidiary  has  disclosed  on its
               federal income Tax Returns all positions taken therein that could
               give rise to a substantial  understatement  of federal income Tax
               within the meaning of Code Section 6662.  Neither the Company nor
               its  Subsidiary  is a party  to any  Tax  allocation  or  sharing
               agreement.  Neither the Company nor its Subsidiary (i) has been a
               member  of an  Affiliated  Group  filing a  consolidated  federal
               income Tax Return  (other than a group the common parent of which
               was the Company) or (ii) has any  Liability  for the Taxes of any
               Person (other than the Company and its  Subsidiary)  under Treas.
               Reg. Section 1.1502-6 (or any similar provision of state,  local,
               or foreign law), as a transferee  or successor,  by contract,  or
               otherwise.

          (f)  The unpaid Taxes of the Company and its  Subsidiary  (i) did not,
               as of the Most Recent  Fiscal  Month End,  exceed the reserve for
               Tax  Liability  (rather  than  any  reserve  for  deferred  Taxes
               established  to reflect timing  differences  between book and Tax
               income)  set forth on the face of the Most Recent  Balance  Sheet
               (or in any notes  thereto)  and (ii) will not exceed that reserve
               as adjusted for operations and  transactions  through the Closing
               Date in  accordance  with the past  custom  and  practice  of the
               Company and its Subsidiary in filing their Tax Returns.

     4.12 Real Property.

          (a)  The Company and its Subsidiary own no real property.

          (b)  Section  4.12(b) of the  Disclosure  Schedule lists and describes
               briefly  all real  property  leased or  subleased  to either  the
               Company or its  Subsidiary.  The Sellers  have  delivered  to the
               Buyer  correct and  complete  copies of the leases and  subleases
               listed in Section 4.12(b) of the Disclosure Scheduled (as amended
               to date).  With  respect  to each  lease and  sublease  listed in
               Section 4.12(b) of the Disclosure Schedule:

               (i)  the lease or sublease is legal, valid, binding, enforceable,
                    and in full force and effect;

               (ii) the lease or  sublease  will  continue  to be legal,  valid,
                    binding,  enforceable,  and in  full  force  and  effect  on
                    identical   terms   following   the   consummation   of  the
                    transactions contemplated hereby;

              (iii) the Company is not,  and to the  knowledge  of  Sellers,  no
                    other party to the lease or  sublease  has been in breach or
                    default,  and no event has  occurred  which,  with notice or
                    lapse of time,  would  constitute  a breach  or  default  or
                    permit    termination,    modification,    or   acceleration
                    thereunder;

               (iv) the Company is not,  and to the  knowledge  of  Sellers,  no
                    other  party to the lease or  sublease  has  repudiated  any
                    provision thereof;

               (v)  there  are no  disputes,  oral  agreements,  or  forbearance
                    programs in effect as to the lease or sublease;

               (vi) with  respect  to each  sublease,  the  representations  and
                    warranties  set forth in  subsections  (i) through (v) above
                    true and correct with respect to the underlying lease;

              (vii )neither  the  Company  nor  its   Subsidiary  has  assigned,
                    transferred,   conveyed,  mortgaged,  deeded  in  trust,  or
                    encumbered any interest in the leasehold or subleasehold;

             (viii) all  facilities  leased  or  subleased   thereunder  have
                    received   all   approvals   of   governmental   authorities
                    (including licenses and permits) required in connection with
                    the  Company's  operation  thereof and, to the  knowledge of
                    Sellers,  have been  operated and  maintained  in accordance
                    with applicable laws, rules, and regulations; and

               (ix) all facilities  leased or subleased  thereunder are supplied
                    with  utilities  and  other   services   necessary  for  the
                    operation of said facilities.

     4.13 Intellectual Property.

          (a)  The  Company  and its  Subsidiary  own or have  the  right to use
               pursuant to license,  sublicense,  agreement,  or permission  all
               Intellectual Property necessary for the operation of the business
               of the Company and its  Subsidiary as presently  conducted.  Each
               item of Intellectual Property owned or used by either the Company
               or its Subsidiary immediately prior to the Closing hereunder will
               be owned or available for use by the Company or the Subsidiary on
               identical  terms and  conditions  immediately  subsequent  to the
               Closing  hereunder.  Each of the Company and its  Subsidiary  has
               taken all  necessary  action to maintain and protect each item of
               Intellectual Property that it owns or uses.

          (b)  Neither the  Company  nor its  Subsidiary  has  interfered  with,
               infringed  upon,  misappropriated,  or violated any  Intellectual
               Property rights of third parties, and none of the Sellers and the
               directors and officers (and  employees  with  responsibility  for
               Intellectual  Property matters) of the Company and its Subsidiary
               has ever received any charge, complaint, claim, demand, or notice
               alleging any such interference,  infringement,  misappropriation,
               or violation  (including any claim that either the Company or its
               Subsidiary  must license or refrain  from using any  Intellectual
               Property  rights of any third party).  To the Knowledge of any of
               the Sellers and the directors and officers  (and  employees  with
               responsibility for Intellectual  Property matters) of the Company
               and its Subsidiary, no third party has interfered with, infringed
               upon,  misappropriated,  or violated  any  Intellectual  Property
               rights of either the Company or its Subsidiary.

          (c)  Section  4.13(c)  of  the  Disclosure  Schedule  identifies  each
               registered trademark,  trade name or unregistered  trademark used
               by either the Company or its Subsidiary in connection with any of
               its  businesses.  With  respect  to  each  item  of  Intellectual
               Property  required  to be  identified  in Section  4.13(c) of the
               Disclosure Schedule:

               (i)  the Company and its Subsidiary possess all right, title, and
                    interest in and to the item,  free and clear of any Security
                    Interest, license, or other restriction;

               (ii) the  item  is not  subject  to any  outstanding  injunction,
                    judgment, order, decree, ruling, or charge;

              (iii) no  action,  suit,   proceeding,   hearing,   investigation,
                    charge,  complaint,  claim,  or demand is pending or, to the
                    Knowledge  of any of  the  Sellers  and  the  directors  and
                    officers (and employees with responsibility for Intellectual
                    Property   matters)  of  the  Company  and  its  Subsidiary,
                    threatened   which   challenges   the  legality,   validity,
                    enforceability, use, or ownership of the item; and

               (iv) neither the Company  nor its  Subsidiary  has ever agreed to
                    indemnify  any  Person  for  or  against  any  interference,
                    infringement,   misappropriation,  or  other  conflict  with
                    respect to the item.

          (d)  Section 4.13(d) of the Disclosure  Schedule  identifies each item
               of  Intellectual  Property  that any  third  party  owns and that
               either the Company or its  Subsidiary  uses  pursuant to license,
               sublicense,  agreement, or permission. The Sellers have delivered
               to the Buyer  correct and complete  copies of all such  licenses,
               sublicenses,  agreements,  and  permissions (as amended to date).
               With respect to each item of Intellectual Property required to be
               identified in Section 4.13(d) of the Disclosure Schedule:

               (i)  the license,  sublicense,  agreement, or permission covering
                    the item is legal, valid, binding,  enforceable, and in full
                    force and effect;

               (ii) the  license,   sublicense  agreement,  or  permission  will
                    continue to be legal, valid,  binding,  enforceable,  and in
                    full  force  and  effect  on  substantially   similar  terms
                    following the Closing;

              (iii) the Company is not,  and to the  knowledge  of  Sellers,  no
                    other  party  to  the  license,  sublicense,  agreement,  or
                    permission  is in  breach  or  default,  and  no  event  has
                    occurred which with notice or lapse of time would constitute
                    a breach or default or permit termination,  modification, or
                    acceleration thereunder;

               (iv) the Company is not,  and to the  knowledge  of  Sellers,  no
                    other  party  to  the  license,  sublicense,  agreement,  or
                    permission has repudiated any provision thereof;

               (v)  the underlying item of Intellectual  Property is not subject
                    to any  outstanding  injunction,  judgment,  order,  decree,
                    ruling, or charge;

               (vi) no action, suit, proceeding, hearing, investigation, charge,
                    complaint,  claim, or demand is pending or, to the Knowledge
                    of any of the Sellers and the  directors and officers of the
                    Company and its Subsidiary,  is threatened  which challenges
                    the legality,  validity, or enforceability of the underlying
                    item of Intellectual Property; and

              (vii) neither  the  Company  nor its  Subsidiary  has  granted any
                    sublicense  or similar  right with  respect to the  license,
                    sublicense, agreement, or permission.

     4.14 Tangible  Assets.  The  Company  and its  Subsidiary  own or lease all
          buildings,  machinery,  equipment, and other tangible assets necessary
          for the conduct of their businesses as presently conducted.  Each such
          tangible  asset is free from  defects  (patent and  latent),  has been
          maintained in accordance  with normal  industry  practice,  is in good
          operating  condition and repair (subject to normal wear and tear), and
          is suitable for the purposes for which it presently is used.

     4.15 Inventory. The inventory of the Company and its Subsidiary consists of
          raw  materials,  packaging  materials and supplies,  manufactured  and
          purchased parts, goods in process, and finished goods, all of which is
          merchantable  and fit for the  purpose  for which it was  procured  or
          manufactured, and none of which is slow-moving,  obsolete, damaged, or
          defective,  subject only to the reserve for  inventory  writedown  set
          forth on the fact of the Most  Recent  Balance  Sheet (or in any notes
          thereto) as adjusted  for the passage of time through the Closing Date
          in accordance with the past custom and practice of the Company and its
          Subsidiary.

     4.16 Contracts. Section 4.16 of the Disclosure Schedule lists the following
          contracts  and other  agreements  to which  either the  Company or its
          Subsidiary is a party:

          (a)  any agreement (or group of related  agreements)  for the lease of
               personal  property  to or from any  Person  providing  for  lease
               payments in excess of $5,000 per annum;

          (b)  any agreement (or group of related  agreements)  for the purchase
               or sale of raw materials,  commodities,  supplies,  products,  or
               other  personal  property,  or for the  furnishing  or receipt of
               services,  the  performance of which will extend over a period of
               more  than one  year,  result in a  material  loss to either  the
               Company or its Subsidiary as they currently  operate,  or involve
               consideration in excess of $5,000;

          (c)  any agreement concerning a partnership or joint venture;

          (d)  any agreement (or group of related agreements) under which it has
               created,  incurred,  assumed,  or guaranteed any indebtedness for
               borrowed money, or any capitalized lease obligation, in excess of
               $5,000 or under which it has  imposed a Security  Interest on any
               of its assets,  tangible or intangible having a purchase price in
               excess of $5,000;

          (e)  any agreement concerning noncompetition;

          (f)  any agreement with any of the Sellers and their Affiliates (other
               than the Company and its Subsidiary);

          (g)  any  profit  sharing,  stock  options,   stock  purchase,   stock
               appreciation, deferred compensation,  severance, or other plan or
               arrangement  for the benefit of its current or former  directors,
               officers, and employees;

          (h)  any collective bargaining agreement;

          (i)  any  agreement  for  the   employment  of  any  individual  on  a
               full-time, part-time, consulting, or other basis providing annual
               compensation in excess of $50,000 or providing severance benefits
               in excess of two (2) weeks' pay;

          (j)  any agreement under which it has advanced or loaned any amount to
               any  of  its  directors,  officers,  and  employees  outside  the
               Ordinary Course of Business;

          (k)  any  agreement  under  which the  consequences  of a  default  or
               termination could have a material adverse effect on the business,
               financial  condition,  operations,  or results of  operations  of
               either the Company or its Subsidiary; or

          (l)  any  other  agreement  (or  group  of  related   agreements)  the
               performance of which involves consideration in excess of $5,000.

          The Sellers have delivered to the Buyer a correct and complete copy of
          each  written  agreement  listed  in  Section  4.16 of the  Disclosure
          Schedule (as amended to date) and a written  summary setting forth the
          material terms and  conditions of each oral  agreement  referred to in
          Section  4.16 of the  Disclosure  Schedule.  With respect to each such
          agreement:  (i) the agreement is legal, valid,  binding,  enforceable,
          and in full force and effect;  (ii) the agreement  will continue to be
          legal, valid,  binding,  enforceable,  and in full force and effect in
          all material  respects  following the consummation of the transactions
          contemplated  hereby;  (iii) the Company has not, and to the knowledge
          of Sellers,  no other party is in breach or default,  and no event has
          occurred, which with notice or lapse of time would constitute a breach
          or default,  or permit  termination,  modification,  or  acceleration,
          under  the  agreement;  and  (iv)  the  Company  has  not,  and to the
          knowledge of Sellers,  no other party has  repudiated any provision of
          the agreement.

     4.17 Notes and Accounts  Receivable.  All notes and accounts  receivable of
          the Company and its Subsidiary  are reflected  properly on their books
          and  records,   are  valid  receivables   subject  to  no  setoffs  or
          counterclaims,  are current and collectible,  and will be collected in
          accordance with their terms at their recorded amounts, subject only to
          the  reserve  for bad debts  set forth on the face of the Most  Recent
          Balance Sheet (or in any notes thereto) as adjusted for the passage of
          time through the Closing Date in  accordance  with the past custom and
          practice of the Company and its Subsidiary.

     4.18 Powers of  Attorney.  There  are no  outstanding  powers  of  attorney
          executed on behalf of either the Company or its Subsidiary.

     4.19 Insurance.  Section  4.19 of the  Disclosure  Schedule  sets forth the
          following information with respect to each insurance policy (including
          policies  providing  property,   casualty,   liability,  and  workers'
          compensation  coverage  and bond  and  surety  arrangements)  to which
          either  the  Company  or its  Subsidiary  has  been a  party,  a named
          insured,  or otherwise the  beneficiary of coverage at any time within
          the past three years:

          (a)  the name, address, and telephone number of the agent;

          (b)  the name of the insurer,  the name of the  policyholder,  and the
               name of each covered insured;

          (c)  the policy number and the period of coverage; and

          (d)  a description  of any  retroactive  premium  adjustments or other
               loss-sharing arrangements.

          With respect to each such insurance  policy:  (i) the policy is legal,
          valid,  binding,  enforceable,  and in full force and effect; (ii) the
          policy will continue to be legal, valid, binding,  enforceable, and in
          full force and effect on identical terms following the consummation of
          the transactions contemplated hereby; (iii) neither the Company or its
          Subsidiary  nor, to the Knowledge of the Sellers and the directors and
          officers (and employees with  responsibility  for insurance  matters),
          any other party to the policy is in breach or default  (including with
          respect to the payment of premiums or the giving of  notices),  and no
          event  has  occurred  which,  with  notice  or lapse  of  time,  would
          constitute   such  a  breach  or  default,   or  permit   termination,
          modification, or acceleration,  under the policy; and (iv) the Company
          has not, and to the  knowledge of Sellers,  no party to the policy has
          repudiated  any  provision  thereof;  and all losses  incurred but not
          reported have been disclosed to Buyer.  Section 4.19 of the Disclosure
          Schedule  describes  any  self-insurance  arrangements  affecting  the
          Company and its Subsidiary.

     4.20 Litigation.  Section 4.20 of the  Disclosure  Schedule sets forth each
          instance in which the Company and its Subsidiary (i) is subject to any
          outstanding injunction,  judgment, order, decree, ruling, or charge or
          (ii) is a party or, to the  Knowledge  of any of the  Sellers  and the
          directors  and  officers  of  the  Company  and  its  Subsidiary,   is
          threatened  to be  made a  party  to  any  action,  suit,  proceeding,
          hearing,   or   investigation   of,   in,  or  before   any  court  or
          quasi-judicial or administrative agency of any federal,  state, local,
          or foreign jurisdiction or before any arbitrator.

     4.21 Product  Warranty.   Each  product  manufactured,   sold,  leased,  or
          delivered  by the Company and its  Subsidiary  has been in  conformity
          with  all  applicable  contractual  commitments  and all  express  and
          implied warranties, and neither the Company nor its Subsidiary has any
          Liability  for  replacement  or repair  thereof  or other  damages  in
          connection therewith, subject only to the reserve for product warranty
          claims set forth on the face of the Most Recent  Balance  Sheet (or in
          any notes thereto) as adjusted for operations and transactions through
          the Closing  Date in  accordance  with the past custom and practice of
          the Company and its Subsidiary. No product manufactured, sold, leased,
          or  delivered  by the  Company  or its  Subsidiary  is  subject to any
          guaranty, warranty, or other indemnity, beyond the applicable standard
          terms and conditions of sale or lease.  Section 4.21 of the Disclosure
          Schedule  includes copies of the standard terms and conditions of sale
          or  lease  for  each of the  Company  and its  Subsidiary  (containing
          applicable guaranty, warranty, and indemnity provisions).

     4.22 Product  Liability.  No  person  has  asserted  any  claim,  or to the
          knowledge of Sellers,  has  threatened  to assert a claim,  which,  if
          successful,  would  result  in a  Liability  for  the  Company  or its
          Subsidiary out of any injury to individuals or property as a result of
          the ownership,  possession, or use of any product manufactured,  sold,
          leased,  or  delivered by the Company or its  Subsidiary  prior to the
          Closing Date.

     4.23 Employees.  To the  Knowledge of any of the Sellers and the  directors
          and  officers  (and  employees  with   responsibility  for  employment
          matters)  of  the  Company  and  its  Subsidiary,  no  executive,  key
          employee,  or group of employees has any announced  plans to terminate
          employment  with  either the  Company or its  Subsidiary.  Neither the
          Company nor its  Subsidiary  is a party to or bound by any  collective
          bargaining  agreement,  nor has any of them  experienced  any strikes,
          grievances,  claims of unfair  labor  practices,  or other  collective
          bargaining  disputes  within  the last three (3)  years.  Neither  the
          Company nor its  Subsidiary  has committed  any unfair labor  practice
          where the result of such activity would have a material adverse effect
          on the  Company  and its  Subsidiary,  taken as a  whole.  None of the
          Sellers  and  the   directors  and  officers   (and   employees   with
          responsibility  for  employment   matters)  of  the  Company  and  its
          Subsidiary has any Knowledge of any  organizational  effort  presently
          being  made or  threatened  by or on behalf of any  labor  union  with
          respect to employees of the Company or its Subsidiary.

     4.24 Employee Benefits.

          (a)  Section  4.24 of the  Disclosure  Schedule  lists  each  Employee
               Benefit Plan that the Company and its Subsidiary  maintains or to
               which either the Company or its Subsidiary contributes.

               (i)  Each such  Employee  Benefit Plan (and each  related  trust,
                    insurance  contract,  or  fund)  complies  in  form  and  in
                    operation in all respects with the  applicable  requirements
                    of ERISA, the Code, and other applicable laws.

               (ii) All required  reports or  descriptions  (including Form 5500
                    Annual  Reports,  Summary  Annual  Reports,   PBGC-1's,  and
                    Summary Plan  Descriptions)  have been filed or  distributed
                    with  respect  to  each  such  Employee  Benefit  Plan.  The
                    requirements of Part 6 of Subtitle B of Title I of ERISA and
                    of Code  Section  4980B  have been met with  respect to each
                    such  Employee  Benefit  Plan which is an  Employee  Welfare
                    Benefit Plan.

              (iii) All contributions  (including all employer contributions and
                    employee salary reduction  contributions) which are due have
                    been paid to each such  Employee  Benefit  Plan  which is an
                    Employee Pension Benefit Plan and all  contributions for any
                    period  ending on or before the  Closing  Date which are not
                    yet due have been paid to each such Employee Pension Benefit
                    Plan or  accrued  in  accordance  with the past  custom  and
                    practice of the Company and its Subsidiary.  All premiums or
                    other  payments  for all  periods  ending on or  before  the
                    Closing  Date  have  been  paid  with  respect  to each such
                    Employee  Benefit Plan which is an Employee  Welfare Benefit
                    Plan.

               (iv) Each such Employee Benefit Plan which is an Employee Pension
                    Benefit Plan has received a favorable  determination  letter
                    from the  Internal  Revenue  Service  that it meets  Section
                    401(a) of the Code.

               (v)  The market value of assets under each such Employee  Benefit
                    Plan which is an Employee  Pension  Benefit Plan (other than
                    any Multiemployer  Plan) equals or exceeds the present value
                    of  all  vested   and   nonvested   Liabilities   thereunder
                    determined in accordance  with PBGC  methods,  factors,  and
                    assumptions  applicable to an Employee  Pension Benefit Plan
                    terminating on the date for determination.

               (vi) The Sellers have delivered to the Buyer correct and complete
                    copies of the plan documents and summary plan  descriptions,
                    the  most  recent  determination  letter  received  from the
                    Internal Revenue  Service,  the most recent Form 5500 Annual
                    Report,   and  all  related  trust   agreements,   insurance
                    contracts, and other funding agreements which implement each
                    such Employee Benefit Plan.

          (b)  With  respect  to each  Employee  Benefit  Plan that  either  the
               Company,  or its Subsidiary,  maintains or ever has maintained or
               to which any of them contributes,  ever has contributed,  or ever
               has been required to contribute,  an Employee  Benefit Plan which
               is an Employee Pension Benefit Plan:

               (i)  No such Employee  Benefit Plan which is an Employee  Pension
                    Benefit  Plan (other than any  Multiemployer  Plan) has been
                    completely or partially  terminated or been the subject of a
                    Reportable Event as to which notices would be required to be
                    filed with the PBGC.  No proceeding by the PBGC to terminate
                    any such  Employee  Pension  Benefit  Plan  (other  than any
                    Multiemployer Plan) has been instituted or, to the Knowledge
                    of any of the Sellers and the  directors  and officers  (and
                    employees with  responsibility for employee benefit matters)
                    of the Company and its Subsidiary, threatened.

               (ii) There have been no Prohibited  Transactions  with respect to
                    any  such  Employee  Benefit  Plan.  No  Fiduciary  has  any
                    Liability for breach of fiduciary  duty or any other failure
                    to act or comply in connection  with the  administration  or
                    investment of the assets of any such Employee  Benefit Plan.
                    No action, suit, proceeding,  hearing, or investigation with
                    respect  to  the  administration  or the  investment  of the
                    assets of any such Employee Benefit Plan (other than routine
                    claims for  benefits) is pending or, to the Knowledge of any
                    of the Sellers and the directors and officers (and employees
                    with  responsibility  for employee  benefit  matters) of the
                    Company and its Subsidiary,  threatened. None of the Sellers
                    and  the  directors  and  officers   (and   employees   with
                    responsibility  for employee benefit matters) of the Company
                    and its  Subsidiary  has any  Knowledge of any Basis for any
                    such action, suit, proceeding, hearing, or investigation.

          (c)  None of the Company, its Subsidiary, and the other members of the
               Controlled  Group of  Corporations  that includes the Company and
               its Subsidiary (i)  contributes  to, ever has  contributed to, or
               ever has been required to contribute to any Multiemployer Plan or
               has any  Liability  (including  withdrawal  Liability)  under any
               Multiemployer  Plan or (ii)  maintains or  contributes  to or has
               ever  maintained  or  contributed  to a  qualified  pension  plan
               subject  to the  minimum  funding  requirements  of ERISA and the
               Code.

          (d)  Neither  the  Company nor its  Subsidiary  maintains  or ever has
               maintained or contributes, ever has contributed, or ever has been
               required to  contribute  to any  Employee  Welfare  Benefit  Plan
               providing   medical,   health,   or  life   insurance   or  other
               welfare-type benefits for current or future retired or terminated
               employees,  their  spouses,  or their  dependents  (other than in
               accordance with Code Section 4980B).

     4.25 Guaranties.  Neither the Company nor its  Subsidiary is a guarantor or
          otherwise  is  liable  for  any  Liability  or  obligation  (including
          indebtedness) of any other Person.

     4.26 Environmental, Health, and Safety.

          (a)  Each of the  Company  and its  Subsidiary,  and their  respective
               predecessors and Affiliates has complied with all  Environmental,
               Health,  and  Safety  Laws,  and  no  action,  suit,  proceeding,
               hearing,  investigation,  charge,  complaint,  claim,  demand, or
               notice has been filed or commenced  against any of them  alleging
               any failure so to comply.  Without limiting the generality of the
               preceding  sentence,  each of the Company,  its  Subsidiary,  and
               their  respective  predecessors  and  Affiliates has obtained and
               been in  compliance  with all of the terms and  conditions of all
               permits,  licenses,  and other  authorizations which are required
               under, and has complied with all other limitations, restrictions,
               conditions, standards, prohibitions,  requirements,  obligations,
               schedules,   and   timetables   which  are   contained   in,  all
               Environmental, Health, and Safety Laws.

          (b)  Neither the Company nor its  Subsidiary  has any  Liability  (and
               none  of  the  Company,  its  Subsidiary,  and  their  respective
               predecessors  and  Affiliates  has  handled  or  disposed  of any
               substance,  arranged for the disposal of any  substance,  exposed
               any employee or other  individual  to any substance or condition,
               or owned or operated  any property or facility in any manner that
               could  form the Basis for any  present  or future  action,  suit,
               proceeding, hearing, investigation,  charge, complaint, claim, or
               demand against  either the Company or its Subsidiary  giving rise
               to any  Liability) for damage to any site,  location,  or body of
               water  (surface  or  subsurface),  for any illness of or personal
               injury to any employee or other individual,  or other individual,
               or for any reason  under any  Environmental,  Health,  and Safety
               Law.

          (c)  All properties and equipment used in the business of the Company,
               its Subsidiary,  and their respective predecessors and Affiliates
               have  been  free  of   asbestos,   PCB's,   methylene   chloride,
               trichloroethylene,       1,2-transdichloroethylene,      dioxins,
               dibenzofurans, and Extremely Hazardous Substances.

     4.27 Certain  Business  Relationships  with the Company and Its Subsidiary.
          None of the Sellers has been involved in any business  arrangement  or
          relationship  with the  Company or its  Subsidiary  within the past 12
          months,  and  none  of  the  Sellers  owns  any  asset,   tangible  or
          intangible,  which  is  used in the  business  of the  Company  or its
          Subsidiary.

     4.28 Tufco. On or prior to the Closing,  all tooling assets and vehicles of
          Tufco, Inc. shall have been transferred to the Company and the Company
          shall have valid title,  free from any liens or security  interests to
          such assets.  Such assets  include the tooling as described on Exhibit
          4.28, which shall include the physical location of each tool.

     4.29 Expenses. Each of the Buyer, JPE, the Company, and its Subsidiary will
          bear his or its own  costs  and  expenses  (including  legal  fees and
          expenses)   incurred  in  connection   with  this  agreement  and  the
          transactions  contemplated  hereby. The Sellers agree that neither the
          Company nor its  Subsidiary has borne or will bear any of the Sellers'
          costs and expenses (including any of their legal fees and expenses) in
          connection with this Agreement or any of the transactions contemplated
          hereby.

     4.30 Disclosure.  The  representations  and  warranties  contained  in this
          Section 4 do not contain any untrue  statement  of a material  fact or
          omit to  state  any  material  fact  necessary  in  order  to make the
          statements and information contained in this Section 4 not misleading.

5.   POST-CLOSING  COVENANTS.  The Parties  agree as follows with respect to the
     period following the Closing:

     5.1  General.  In case at any time after the Closing any further  action is
          necessary  to carry out the  purposes of this  Agreement,  each of the
          Parties will take such further  action  (including  the  execution and
          delivery of such further instruments and documents) as any other Party
          reasonably  may  request,  all at the  sole  cost and  expense  of the
          requesting   Party  (unless  the  requesting   Party  is  entitled  to
          indemnification   therefor   under  Section  7  below).   The  Sellers
          acknowledge  and agree that from and after the  Closing the Buyer will
          be entitled to possession of all documents,  books, records (including
          Tax records),  agreements,  and financial data of any sort relating to
          the Company and its  Subsidiary.  Buyer agrees that from and after the
          Closing  Date,  the  Sellers  shall  have  reasonable  access  to  all
          documents,  books,  records  (including  Tax records),  agreements and
          financial  data of the  Company  but only to the  extent  the same are
          reasonably  required in connection with the period up to and including
          the Closing Date.

     5.2  Litigation Support. In the event and for so long as any Party actively
          is  contesting  or  defending  against any action,  suit,  proceeding,
          hearing,  investigation,   charge,  complaint,  claim,  or  demand  in
          connection with (i) any transaction  contemplated under this Agreement
          or  (ii)  any  fact,  situation,   circumstance,   status,  condition,
          activity, practice, plan, occurrence, event, incident, action, failure
          to act,  or  transaction  on or prior to the  Closing  Date  involving
          either the Company or its  Subsidiary,  each of the other Parties will
          cooperate  with him or it and his or its  counsel  in the  contest  or
          defense,  make available their  personnel,  and provide such testimony
          and  access  to their  books  and  records  as shall be  necessary  in
          connection  with the  contest  or  defense,  all at the sole  cost and
          expense of the contesting or defending Party (unless the contesting or
          defending Party is entitled to indemnification  therefor under Section
          7 below).

     5.3  Transition.  Except as otherwise  agreed  between Buyer and any of the
          Sellers,  until December 31, 1997,  each of the Sellers agrees that he
          will not take any action  that is  designed  or  intended  to have the
          effect of discouraging any lessor,  licensor,  customer,  supplier, or
          other business  associate of either the Company or its Subsidiary from
          maintaining  the same business  relationships  with the Company or its
          Subsidiary  after the Closing as it maintained with the Company or its
          Subsidiary prior to the Closing;  provided  however,  in the event the
          Company or Buyer  terminates the employment of Mr. Garner (without the
          other entity  immediately  hiring him),  Mr.  Garner shall be released
          from the  obligations  created by this  sentence.  Each of the Sellers
          will refer all customer  inquiries  relating to the  businesses of the
          Company and its  Subsidiary  to the Buyer from and for a period of one
          year after the  Closing;  provided,  however,  in the event Don Garner
          ceases to be an employee of either the  Company or Buyer,  Mr.  Garner
          shall be released from the obligations created by this sentence. Buyer
          agrees  that  prior to  December  31,  1997 it will not (i) change Mr.
          Garners' base rate of compensation of $71,656; (ii) change the company
          provided vehicle he is currently driving,  or (iii) require Mr. Garner
          to relocate.  Buyer's  failure to comply with any such covenants shall
          release Mr. Garner from all obligations set forth in this Section 5.3.

     5.4  Confidentiality.  Each of the Sellers  will treat and hold as such all
          of  the  Confidential  Information,  refrain  from  using  any  of the
          Confidential Information except in connection with this Agreement, and
          deliver promptly to the Buyer or destroy, at the request and option of
          the  Buyer,   all  tangible   embodiments  (and  all  copies)  of  the
          Confidential  Information  which are in his or its possession.  In the
          event  that any of the  Sellers  is  requested  or  required  (by oral
          question  or  request  for  information  or  documents  in  any  legal
          proceeding,  interrogatory,  subpoena,  civil investigative demand, or
          similar process) to disclose any Confidential Information, that Seller
          will notify the Buyer  promptly of the request or  requirement so that
          the Buyer may seek an appropriate protective order or waive compliance
          with the  provisions  of this  Section  5.4.  If, in the  absence of a
          protective  order or the  receipt  of a waiver  hereunder,  any of the
          Sellers  is, on the  advice of  counsel,  compelled  to  disclose  any
          Confidential  Information  to any  tribunal  or else stand  liable for
          contempt, that Seller may disclose the Confidential Information to the
          tribunal;  provided, however, that the disclosing Seller shall use his
          or its reasonable best efforts to obtain, at the reasonable request of
          Buyer, an order or other assurance that confidential treatment will be
          accorded to such portion of the Confidential  Information  required to
          be disclosed as the Buyer shall  designate.  The foregoing  provisions
          shall not apply to any  Confidential  Information  which is  generally
          available to the public immediately prior to the time of disclosure.

     5.5  Termination  of 401(k) Plan.  In the event the Brake,  Axle and Tandem
          Company Profit  Sharing Plan has not been  terminated on or before the
          Closing,  Sellers shall  terminate  such plan  promptly  following the
          Closing and Buyer shall assume no responsibility  for such termination
          or any  obligations of such plan. In addition,  the Company shall have
          made any and all payments and deposits due and owing to such plan.

     5.6  Employees. For employees of the Company who become employees of Buyer,
          Buyer shall recognize service with the Company for purposes of vesting
          of benefits,  but not accrual.  All other employees who are terminated
          by the Company  after the Closing Date and who are  employed  with the
          Company through their respective  termination  dates, as determined by
          the  Company,  shall  receive  severance as  determined  either (i) by
          written  agreement  between the  Company and such  employee or (ii) as
          generally outlined on Exhibit 5.6.

6.   CONDITIONS TO OBLIGATION TO CLOSE.

     6.1  Conditions to Obligation of the Buyer.  The obligation of the Buyer to
          consummate the  transactions  to be performed by it in connection with
          the Closing is subject to satisfaction of the following conditions:

          (a)  the  representations  and warranties set forth in Section 3.1 and
               Section  4  above  shall  be true  and  correct  in all  material
               respects at and as of the Closing Date;

          (b)  the Sellers  shall have  performed and complied with all of their
               covenants hereunder in all material respects through the Closing;

          (c)  the  Company and its  Subsidiary  shall have given any notices to
               third  parties  and shall have  procured  all of the third  party
               consents that Buyer  reasonably  may have requested in connection
               with the matters  referred to in Section 4.3 above,  except (i) a
               waiver from the landlord of the Dallas  warehouse for the benefit
               of Comerica Bank, as agent,  with regard to the Company's  assets
               and (ii) a consent from such landlord to any  assignment of lease
               deemed to occur as a result of the Closing;

          (d)  no  action,  suit,  or  proceeding  shall be  pending  or, to the
               Knowledge   of   Sellers,   threatened   before   any   court  or
               quasi-judicial  or administrative  agency of any federal,  state,
               local, or foreign  jurisdiction or before any arbitrator  wherein
               an unfavorable  injunction,  judgment,  order, decree, ruling, or
               charge would (i) prevent any Seller's  consummation of any of the
               transactions  contemplated by this  Agreement,  (ii) cause any of
               the  transactions  contemplated by this Agreement to be rescinded
               following  consummation,  (iii) affect adversely the right of the
               Buyer to own the  Company  Shares and to control  the Company and
               its Subsidiary,  or (iv) affect adversely the right of either the
               Company or its  Subsidiary  to own its assets and to operate  its
               businesses  (and no such  injunction,  judgment,  order,  decree,
               ruling, or charge shall be in effect);

          (e)  the Sellers shall have  delivered to the Buyer a  certificate  to
               the effect that each of the conditions specified above in Section
               6.1(a)-(d)  is  satisfied,   with  respect  to  himself,  in  all
               respects;

          (f)  Buyer  shall have  entered  into an  employment  and  non-compete
               agreement  with John  Martin  Boyd for a period of five (5) years
               with an annual  non-compete  payment in the amount of $70,000 and
               upon the terms and conditions as set forth in Exhibit 6.1(f);

          (g)  George  Boyd  shall  have  entered  into  a  five  year  covenant
               not-to-compete  agreement  with  Buyer  in the  form  of  Exhibit
               2.2(b);

          (h)  Each Seller shall have  delivered  to Buyer a General  Release in
               the form of Exhibit 6.1(h);

          (i)  Sellers shall have  delivered to Buyer a General  Release from Al
               McCaleb;

          (j)  The Company  shall have entered into  severance  agreements  with
               each of Butler,  Curtis and Petty in the form of Exhibit  6.1(j),
               which shall replace the severance agreements entered into by such
               employees in 1996;

          (k)  The Company  shall have entered into a severance  agreement  with
               Monilaws in the form of Exhibit  6.1(k),  which shall replace the
               severance agreement dated October 31, 1996;

          (l)  the Buyer  shall have  received  from  counsel to the  Sellers an
               opinion  in form and  substance  as set forth in  Exhibit  6.1(l)
               attached  hereto,  addressed  to the  Buyer,  and dated as of the
               Closing Date;

          (m)  the Buyer shall have received the  resignations,  effective as of
               the Closing,  of each director and officer of the Company and its
               Subsidiary; and

          (n)  all  actions  to be  taken  by the  Sellers  in  connection  with
               consummation  of the  transactions  contemplated  hereby  and all
               certificates, opinions, instruments, and other documents required
               to effect the transactions contemplated hereby will be reasonably
               satisfactory in form and substance to the Buyer.

          The Buyer may waive any condition specified in this Section 6.1 if its
          executes a writing so stating at or prior to the Closing.

     6.2  Conditions to Obligation of the Sellers. The obligation of the Sellers
          to consummate the  transactions  to be performed by them in connection
          with  the  Closing  is  subject  to   satisfaction  of  the  following
          conditions:

          (a)  the representations and warranties set forth in Section 3.2 above
               shall be true and correct in all  material  respects at and as of
               the Closing Date;

          (b)  the Buyer  shall  have  performed  and  complied  with all of its
               covenants hereunder in all material respects through the Closing;

          (c)  no  action,  suit,  or  proceeding  shall be  pending  or, to the
               knowledge of either Buyer or JPE,  threatened before any court or
               quasi-judicial  or administrative  agency of any federal,  state,
               local, or foreign  jurisdiction or before any arbitrator  wherein
               an unfavorable  injunction,  judgment,  order, decree, ruling, or
               charge would (i) prevent  consummation of any of the transactions
               contemplated   by  this   Agreement;   (ii)   cause  any  of  the
               transactions  contemplated  by  this  Agreement  to be  rescinded
               following consummation (and no such injunction,  judgment, order,
               decree, ruling, or charge shall be in effect); or (iii) adversely
               affect  the  ability  of  either  Buyer  or  JPE to  perform  its
               obligations  under the Agreement or transactions  contemplated by
               the Agreement;

          (d)  the Buyer shall have  delivered to the Sellers a  certificate  to
               the effect that each of the conditions specified above in Section
               6.2(a)-(c) is satisfied in all respects;

          (e)  Buyer  shall have  entered  into an  employment  and  non-compete
               agreement  with John  Martin  Boyd for a period of five (5) years
               with an annual  non-compete  payment in the amount of $70,000 and
               upon the terms and conditions as set forth in Exhibit 6.1(f);

          (f)  Simultaneous with the Closing,  Buyer shall pay all amounts owing
               by the  Company  to  Creekwood  Capital  Corporation  and  obtain
               releases from Sellers' guaranties to Creekwood;

          (g)  the  Sellers  shall have  received  from  counsel to the Buyer an
               opinion  in form and  substance  as set forth in  Exhibit  6.2(f)
               attached  hereto,  addressed to the Sellers,  and dated as of the
               Closing Date; and

          (h)  all  actions  to  be  taken  by  the  Buyer  in  connection  with
               consummation  of the  transactions  contemplated  hereby  and all
               certificates, opinions, instruments, and other documents required
               to effect the transactions contemplated hereby will be reasonably
               satisfactory in form and substance to the Sellers.

          The Sellers may waive any  condition  specified in this Section 6.2 if
          they execute a writing so stating at or prior to the Closing.

7.   REMEDIES FOR BREACHES OF THIS AGREEMENT.

     7.1  Survival of Representations and Warranties. All of the representations
          and  warranties  of the Sellers  contained  in Section  4.1,  Sections
          4.3-4.10, Sections 4.12-4.23,  Section 4.24 except with respect to the
          Brake,   Axle  and   Tandem   Company   Profit   Sharing   Plan  which
          representations and warranties shall not terminate,  Section 4.25, and
          Sections  4.27-4.28  shall  survive the Closing  hereunder  (except as
          specifically disclosed on the Disclosure Schedules or Annexes, even if
          the  Buyer  knew or had  reason  to know of any  misrepresentation  or
          breach of warranty at the time of Closing)  and continue in full force
          and effect for a period of eighteen (18) months thereafter. All of the
          other  representations and warranties of the Parties contained in this
          Agreement (including the representations and warranties of the Sellers
          contained in Section 4.11 above) shall survive the Closing  (except as
          specifically disclosed on the Disclosure Schedules or Annexes, even if
          the damaged Party knew or had reason to know of any  misrepresentation
          or breach of  warranty at the time of  Closing)  and  continue in full
          force  and  effect  forever  thereafter  (subject  to  any  applicable
          statutes of limitations).

     7.2  Indemnification Provisions for Benefit of the Buyer and JPE.

          (a)  In the event  any of the  Sellers  breaches  (or in the event any
               third party alleges  facts that,  if true,  would mean any of the
               Sellers has breached) any of their  representations,  warranties,
               and  covenants  contained  herein  (other than the  covenants  in
               Section  2.1  above and the  representations  and  warranties  in
               Sections  3.1 and 4.2  above),  and,  if there  is an  applicable
               survival period pursuant to Section 7.1 above,  provided that the
               Buyer or JPE makes a written  claim for  indemnification  against
               any of the  Sellers  pursuant  to Section  8.8 below  within such
               survival period, then each of the Sellers agrees to indemnify the
               Buyer  and JPE  from  and  against  the  entirety  of an  Adverse
               Consequences  the Buyer or JPE may suffer  through  and after the
               date of the  claim for  indemnification  (including  any  Adverse
               Consequences  the  Buyer or JPE may  suffer  after the end of any
               applicable  survival  period)  resulting  from,  arising  out of,
               relating  to, in the  nature  of, or caused by the breach (or the
               alleged breach);  provided,  however,  that the Sellers shall not
               have  any  obligation  to  indemnify  the  Buyer  or JPE from and
               against any Adverse Consequences  resulting from, arising out of,
               relating  to, in the  nature  of, or  caused  by the  breach  (or
               alleged beach) of any  representation  or warranty of the Sellers
               contained in Section  4.1-4.10 and Section  4.12-4.28 above until
               the Buyer and/or JPE has suffered Adverse  Consequences by reason
               of all such breaches (or alleged breaches) in excess of a $25,000
               aggregate threshold (at which point the Sellers will be obligated
               to  indemnify  the Buyer or JPE from and against all such Adverse
               Consequences  relating  back  to  the  first  dollar).   Sellers'
               indemnification  of Buyer and JPE shall be recovered by Buyer and
               JPE solely by amounts due, if any, under Section 2.2(d).  Further
               provided  that  Buyer's  or JPE's  right to  recovery  under this
               provision  shall  not be  impaired  or  affected  in  any  way by
               Sellers' allocation of the Purchase Price.

          (b)  In the event  any of the  Sellers  breaches  (or in the event any
               third party alleges  facts that,  if true,  would mean any of the
               Sellers has  breached) any of his or its covenants in Section 2.1
               above  or any of his or its  representations  and  warranties  in
               Sections  3.1 and 4.2  above,  and,  if  there  is an  applicable
               survival period pursuant to Section 7.1 above,  provided that the
               Buyer or JPE makes a written  claim for  indemnification  against
               the Seller  pursuant  to Section 8.8 below  within such  survival
               period,  then such Seller  agrees to indemnify  the Buyer and JPE
               from and against the  entirety  of any Adverse  Consequences  the
               Buyer or JPE may suffer  through  and after the date of the claim
               for indemnification (including any Adverse Consequences the Buyer
               may  suffer  after  the end of any  applicable  survival  period)
               resulting from, arising out of, relating to, in the nature of, or
               caused by the breach (or the alleged breach by such Seller only),
               not to exceed such Seller's share of the Purchase Price.

     7.3  Indemnification  Provisions  for Benefit of the Sellers.  In the event
          the Buyer  breaches  (or in the event any third  party  alleges  facts
          that,  if  true,  would  mean  the  Buyer  has  breached)  any  of its
          representations,  warranties,  and covenants contained herein, and, if
          there is an applicable  survival period pursuant to Section 7.1 above,
          provided   that  any  of  the  Sellers   makes  a  written  claim  for
          indemnification against the Buyer pursuant to Section 8.8 below within
          such survival  period,  then the Buyer agrees to indemnify each of the
          Sellers from and against the entirety of any Adverse  Consequences the
          Seller may suffer  after the end of any  applicable  survival  period)
          resulting  from,  arising  out of,  relating  to, in the nature of, or
          caused by the breach (or the alleged breach).

     7.4  Matters Involving Third Parties.

          (a)  If any third  party  shall  notify  any Party  (the  "Indemnified
               Party") with respect to any matter (a "Third Party  Claim") which
               may give rise to a claim for  indemnification  against  any other
               Party (the  "Indemnifying  Party") under this Section 7, then the
               Indemnified Party shall promptly notify each  Indemnifying  Party
               thereof in writing; provided,  however, that no delay on the part
               of the  Indemnified  Party in notifying  any  Indemnifying  Party
               shall  relieve  the   Indemnifying   Party  from  any  obligation
               hereunder unless (and then solely to the extent) the Indemnifying
               Party thereby is prejudiced.

          (b)  Any  Indemnifying  Party  will  have  the  right  to  defend  the
               Indemnified  Party  against the Third Party Claim with counsel of
               its choice  satisfactory to the Indemnified  Party so long as (i)
               the Indemnifying  Party notifies the Indemnified Party in writing
               within 15 days after the  Indemnified  Party has given  notice of
               the Third Party Claim that the Indemnifying  Party will indemnify
               the  Indemnified  Party  from and  against  the  entirety  of any
               Adverse  Consequences the Indemnified  Party may suffer resulting
               from, arising out of, relating to, in the nature or, or caused by
               the Third Party Claim,  subject to the  limitations  set forth in
               Sections 7.1 and 7.2, (ii) the  Indemnifying  Party  provides the
               Indemnified  Party with evidence  acceptable  to the  Indemnified
               Party  that  the  Indemnifying  Party  will  have  the  financial
               resources to defend against the Third Party Claim and fulfill its
               indemnification  obligations  hereunder,  (iii) the  Third  Party
               Claim involves only money damages and does not seek an injunction
               or other  equitable  relief,  (iv)  settlement  of, or an adverse
               judgment  with  respect  to, the Third Party Claim is not, in the
               good faith judgment of the Indemnified Party, likely to establish
               a  precedential  custom or  practice  materially  adverse  to the
               continuing  business  interests of the Indemnified Party, and (v)
               the  Indemnifying  Party  conducts the defense of the Third Party
               Claim actively and diligently.

          (c)  So long as the  Indemnifying  Party is conducting  the defense of
               the Third Party Claim in  accordance  with Section  7.4(b) above,
               (i) the Indemnified  Party may retain separate  co-counsel at its
               sole cost and expense and participate in the defense of the Third
               Party Claim,  (ii) the Indemnified  Party will not consent to the
               entry of any judgment or enter into any  settlement  with respect
               to the Third Party Claim without the prior written consent of the
               Indemnifying Party (not to be withheld  unreasonably),  and (iii)
               the  Indemnifying  Party  will not  consent  to the  entry of any
               judgment or enter into any  settlement  with respect to the Third
               Party Claim without the prior written  consent of the Indemnified
               Party (not to be withheld unreasonably).

          (d)  In the event any of the  conditions in Section 7.4(b) above is or
               becomes  unsatisfied,  however,  (i) the  Indemnified  Party  may
               defend against, and consent to the entry of any judgment or enter
               into any settlement with respect to, the Third Party Claim in any
               manner it reasonably may deem  appropriate  (and the  Indemnified
               Party need not  consult  with,  or obtain any consent  from,  any
               Indemnifying   Party   in   connection   therewith),   (ii)   the
               Indemnifying   Parties  will  reimburse  the  Indemnified   Party
               promptly and periodically for the costs of defending  against the
               Third  Party  Claim  (including  reasonable  attorneys'  fees and
               expenses),   and  (iii)  the  Indemnifying  Parties  will  remain
               responsible for any Adverse  Consequences  the Indemnified  Party
               may suffer  resulting  from,  arising out of, relating to, in the
               nature  of, or caused by the  Third  Party  Claim to the  fullest
               extent  provided in this Section 7 and subject to the limitations
               set forth in Sections 7.1 and 7.2.

     7.5  Determination of Adverse  Consequences.  All indemnification  payments
          under  this  Section 7 shall be  deemed  adjustments  to the  Purchase
          Price.

     7.6  Other  Indemnification  Provisions.  Indemnification  pursuant  to the
          provisions  of this  Section  7 shall be the  exclusive  remedy of the
          Parties  for  any  breach  of a  representation  or  warranty  of this
          Agreement.  The only legal  action  which may be asserted by any Party
          hereto against any other Party hereto with respect to any matter which
          is the  subject  of  Section 7 of this  Agreement  shall be a contract
          action to enforce, or to recover damages consistent with, this Section
          7. Without  limiting the  generality  of the preceding  sentences,  no
          action  sounding  in  contribution,  tort or strict  liability  may be
          maintained  by any Party  hereto  against any other Party  hereto with
          respect  to any  matter  that  is the  subject  of  Section  7 of this
          Agreement.  Nothing in this Section  shall limit the rights of a Party
          hereto under this Agreement to seek and obtain injunctive relief.

8.   MISCELLANEOUS.

     8.1  Nature of Certain Obligations.

          (a)  The  covenants  of each  of the  Sellers  in  Section  2.1  above
               concerning the sale of his or its Company Shares to the Buyer and
               the  representations  and  warranties  of each of the  Sellers in
               Section  3.1  above   concerning  the   transaction  are  several
               obligations.  This means that the  particular  Seller  making the
               representation,  warranty, or covenant will be solely responsible
               to the extent  provided  in, and  subject to the  limitation  of,
               Section 7 above for any Adverse Consequences the Buyer may suffer
               as a result of any breach thereof.

          (b)  The remainder of the representations and warranties  contained in
               Article  4,  and  covenants  set  forth  in  Section  5.5 in this
               Agreement are joint and several obligations. This means that each
               Seller will be  responsible  to the extent  provided in Section 7
               above for the entirety of any Adverse  Consequences the Buyer may
               suffer  as a  result  of  any  breach  thereof,  subject  to  the
               limitations of Section 7 of this Agreement.

     8.2  Press  Releases  and Public  Announcements.  No Seller shall issue any
          press release or make any public announcement  relating to the subject
          matter of this Agreement without the prior written approval of JPE.

     8.3  No  Third-Party  Beneficiaries.  This  Agreement  shall not confer any
          rights or  remedies  upon any Person  other than the Parties and their
          respective successors and permitted assigns.

     8.4  Entire Agreement.  This Agreement (including the documents referred to
          herein)  constitutes  the  entire  agreement  among  the  Parties  and
          supersedes any prior understandings, agreements, or representations by
          or among the Parties,  written or oral, including the letter of intent
          dated March 19,  1997,  to the extent  they  related in any way to the
          subject matter hereof. No warranty or  representation  shall be deemed
          to  have  been  made  by  Sellers   except  for  the   warranties  and
          representations set forth in this Agreement,  the exhibits,  schedules
          and certificates delivered pursuant thereto

     8.5  Succession and  Assignment.  This Agreement  shall be binding upon and
          inure to the benefit of the Parties named herein and their  respective
          successors  and  permitted  assigns.  No Party may assign  either this
          Agreement  or any of his or  its  rights,  interests,  or  obligations
          hereunder  without  the prior  written  approval  of the Buyer and the
          Sellers;  provided,  however,  that any Seller may assign his right to
          receive  payments  under Section 2.2(d) above to heirs and assigns and
          that the Buyer may (i) assign  any or all of its rights and  interests
          hereunder to one or more of its  Affiliates  and (ii) designate one or
          more of its Affiliates to perform its obligations hereunder (in any or
          all of which cases the Buyer nonetheless shall remain  responsible for
          the performance of all of its obligations hereunder). Further provided
          that Buyer's and JPE's obligations  created by this Agreement shall be
          assumed by any  successor  in interest to the business of Buyer either
          directly or indirectly by any successor in interest to the business of
          JPE.

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

     8.7  Headings.  The  section  headings  contained  in  this  Agreement  are
          inserted  for  convenience  only and shall  not  affect in any way the
          meaning or interpretation of this Agreement.

     8.8  Notices.   All  notices,   requests,   demands,   claims,   and  other
          communications  hereunder  will be in writing.  Any  notice,  request,
          demand,  claim, or other communication  hereunder shall be deemed duly
          given if (and then two business  days after) it is sent by  registered
          or certified mail,  return receipt  requested,  postage  prepaid,  and
          addressed to the intended recipient as set forth below:

          If to the Sellers:                 George Boyd
                                             10210 East Lake Highlands Drive
                                             Dallas, Texas  75218

          With a copy to:                    Michael Hainsfurther, Esq.
                                             Munsch, Hardt, Kopf, Harr & Dinan
                                             4000 Fountain Place
                                             1445 Ross Avenue
                                             Dallas, Texas 75202

          If to the Buyer:                   JPE, Inc.
                                             900 Victors Way, Suite 140
                                             Ann Arbor, Michigan 48108
                                             Attention:

          With a copy to:                    Donna L. Bacon
                                             Vice President, General Counsel
                                              and Secretary
                                             JPE, Inc.
                                             900 Victors Way, Suite 140
                                             Ann Arbor, Michigan 48018

          Any  Party  may send any  notice,  request,  demand,  claim,  or other
          communication  hereunder to the intended  recipient at the address set
          forth  above  using  any other  means  (including  personal  delivery,
          expedited courier,  messenger service, telecopy, telex, ordinary mail,
          or electronic mail), but no such notice,  request,  demand,  claim, or
          other communication shall be deemed to have been duly given unless and
          until it actually is received by the intended recipient. Any Party may
          change the address to which notices,  requests,  demands,  claims, and
          other communications hereunder are to be delivered by giving the other
          Parties notice in the manner herein set forth.

     8.9  Governing  Law. This  Agreement  shall be governed by and construed in
          accordance with the domestic laws of the State of Texas without giving
          effect to any choice or conflict of law  provision or rule (whether of
          the State of Texas or any other  jurisdiction)  that  would  cause the
          application  of the laws of any  jurisdiction  other than the State of
          Texas.

     8.10 Amendments  and  Waivers.  No  amendment  of  any  provision  of  this
          Agreement  shall be valid  unless  the same  shall be in  writing  and
          signed  by the Buyer  and the  Sellers.  No waiver by any Party of any
          default,  misrepresentation,   or  breach  of  warranty,  or  covenant
          hereunder,  whether  intentional  or not, shall be deemed to extent to
          any  prior or  subsequent  default,  misrepresentation,  or  breach of
          warranty or covenant hereunder or affect in any way any rights arising
          by virtue of any prior or subsequent such occurrence.

     8.11 Severability.  Any term or provision of this Agreement that is invalid
          or unenforceable in any situation in any jurisdiction shall not affect
          the validity or  enforceability  of the remaining terms and provisions
          hereof or the  validity or  enforceability  of the  offending  term or
          provision in any other situation or in any other jurisdiction.

     8.12 Construction. The Parties have participated jointly in the negotiation
          and drafting of this Agreement.  In the event an ambiguity or question
          of intent or interpretation  arises, this Agreement shall be construed
          as if drafted  jointly by the Parties and no  presumption or burden of
          proof shall arising favoring or disfavoring any Party by virtue of the
          authorship of any of the provisions of this  Agreement.  Any reference
          to any  federal,  state,  local,  or  foreign  statute or law shall be
          deemed  also  to  refer  to  all  rules  and  regulations  promulgated
          thereunder,   unless  the  context   requires   otherwise.   The  word
          "including"  shall mean  including  without  limitation.  The  Parties
          intend that each  representation,  warranty,  and  covenant  contained
          herein shall have independent significance.  If any Party has breached
          any  representation,  warranty,  or covenant  contained  herein in any
          respect, the fact that there exists another representation,  warranty,
          or covenant  relating to the same subject  matter  (regardless  of the
          relative levels of specificity) which the Party has not breached shall
          not detract  from or mitigate  the fact that the Party is in breach of
          the first representation, warranty, or covenant.

     8.13 Incorporation  of Exhibits,  Annexes,  and  Schedules.  The  Exhibits,
          Annexes,  and Schedules  identified in this Agreement are incorporated
          herein by reference and made a part hereof.

     8.14 Dispute Resolution.  Neither party shall institute a proceeding in any
          court or  administrative  agency  to  resolve a  dispute  between  the
          parties  before that party has sought to resolve  the dispute  through
          direct  negotiation  with  the  other  party.  If the  dispute  is not
          resolved within three (3) weeks after a demand for direct negotiation,
          the parties shall attempt to resolve the dispute through mediation. If
          the parties do not promptly agree on a mediator, or if the mediator is
          unable to facilitate a settlement  of the dispute  within a reasonable
          period  of time,  as  determined  by the  mediator  through  a written
          statement to that  effect,  the  aggrieved  party may then seek relief
          through arbitration in a neutral location administered by the American
          Arbitration   Association  under  its  commercial  arbitration  rules,
          provided that the persons eligible to be selected as arbitrators shall
          be  persons  who (i) are on the AAA's  commercial  panel and (ii) have
          specialized  in  either  general  commercial   litigation  or  general
          corporate and commercial  matters.  The  arbitrators  shall base their
          award on  applicable  laws and judicial  precedent and include in such
          award a  statement  of the  reasons  upon  which  the  award is based.
          Judgment on the award rendered by the  arbitrator(s) may be entered in
          any court having jurisdiction thereof.


<PAGE>

IN WITNESS WHEREOF,  the Parties hereto have executed this Agreement on the date
first above written.

JPE, INC.                                  DAYTON PARTS, INC.


By: /s/ James J. Fahrner                   By: /s/ James J. Fahrner
   ------------------------------             ---------------------------------
Title:  V.P.-C.F.O.                        Title:  V.P.-C.F.O.



The Stockholders of Brake, Axle and Tandem Company


/s/ George Boyd                            /s/ Shirley W. Boyd
- ---------------------------------          ------------------------------------
George Boyd                                Shirley W. Boyd


/s/ John Martin Boyd                       /s/ Katherine E. Boyd
- ---------------------------------          ------------------------------------
John Martin Boyd                           Katherine E. Boyd


/s/ Don Garner
- ---------------------------------
Don Garner


/s/ Nolan Boyd                             /s/ Mary A. Boyd
- ---------------------------------          ------------------------------------
Nolan Boyd                                 Mary A. Boyd


/s/ Nathan Boyd                            /s/ Terri L. Boyd
- ---------------------------------          ------------------------------------
Nathan Boyd                                Terri L. Boyd


<PAGE>

                            STOCK PURCHASE AGREEMENT
                                      AMONG
                                   JPE, INC.,
                               DAYTON PARTS, INC.
                                       AND
               THE STOCKHOLDERS OF BRAKE, AXLE AND TANDEM COMPANY


Exhibit       Description
- -------       -----------

2.2(b)        Covenant Not to Compete for George Boyd
2.2(c)(i)     Agreements with James  Butler,  Fred Curtis,  Graem  Monilaws and
              Don Petty concerning severance arrangements
2.2(c)(ii)    Description of severance arrangements with other employees
2.2(d)(1)     Current product line categories of BATCO
2.2(d)(3)     Example of Contingent Payment calculation
2.2(e)        Letter  agreement among JPE, Dayton Parts and the shareholders of
              BATCO regarding other payments
2.3           December 28, 1996 audited balance sheet of BATCO
4.7           Financial Statements of BATCO and its Subsidiary
4.28          Tufco Tooling
5.6           Outline of severance arrangements for employees  terminated by
              BATCO after the Closing Date
6.1(e)        Certificate  of  Sellers re  satisfaction  of  the  conditions
              specified  in  Sections 6.1(a)-(d) of Stock Purchase Agreement
6.1(f)        Employment and non-compete agreement with John Martin Boyd
6.1(h)        General Release from each Seller
6.1(i)        General Release from Al McCaleb
6.1(j)        Severance Agreements to be entered into with Butler, Curtis and
              Petty
6.1(k)        Severance Agreement to be entered into with Monilaws
6.1(l)        Opinion of counsel to Sellers
6.2(d)        Certificate  of  Buyer  re  satisfaction   of  the  conditions 
              specified in  Sections 6.2(a)-(c) of the Stock Purchase Agreement
6.2(f)        Opinion of counsel to Buyer


Disclosure Schedules:
- ---------------------

Exceptions to  representations  and  warranties  concerning  the Company and its
Subsidiary



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