RESTRUCTURING SUPPORT AGREEMENT

 

Agreement ”), dated as of September 15, 2009, whereby certain Lenders agreed to extend the temporary waiver of the Scheduled Defaults (as defined in the Third Temporary Waiver Agreement) and the Additional Default (as defined in the Third Temporary Waiver Agreement) until the Third Temporary Waiver Termination Date (as defined in the Third Temporary Waiver Agreement);

 

WHEREAS, as a result of the then likely occurrence of certain Events of Default under the Pre-Petition Credit Agreement, the Administrative Agent and certain of the Lenders entered into that certain Fourth Temporary Waiver Agreement, dated as of September 30, 2009, whereby certain Lenders agreed to extend the temporary waiver of the Scheduled Defaults (as defined in the Fourth Temporary Waiver Agreement) and the Additional Default (as defined in the Fourth Temporary Waiver Agreement) until the Fourth Temporary Waiver Termination Date (as defined in the Fourth Temporary Waiver Agreement);

 

WHEREAS, as a result of the then likely occurrence of certain Events of Default under the Pre-Petition Credit Agreement, the Administrative Agent and certain of the Lenders entered into that certain Fifth Temporary Waiver Agreement, dated as of October 5, 2009, whereby certain Lenders agreed to temporarily waive certain defaults under the Pre-Petition Credit Agreement until October 8, 2009 in order to afford the Borrowers an opportunity to propose an amendment to or restructuring of their obligations under the Pre-Petition Credit Agreement and the other Loan Documents (defined in the Pre-Petition Credit Agreement) that is acceptable to the Lenders (in their sole discretion);

 

WHEREAS, Accuride expects to enter into a restructuring support agreement on the date hereof (the “ Noteholder Restructuring Support Agreement ”) with certain holders (the “ Noteholders ”) of its 8-1/2% Senior Subordinated Notes due 2015 (the “ Notes ”);

 

WHEREAS, the term sheets (the “ Term Sheets ”) attached as Exhibit A hereto, the Noteholder Commitment Letter (defined below), the Noteholder Restructuring Support Agreement, the DIP Financing Order (defined below), the DIP Credit Agreement (defined below) and the provisions hereof (collectively, the “ Restructuring Support Documents ”) set forth the basic terms of a financial and corporate restructuring of Accuride (sometimes referred to herein as the “ Debtors ”) to be achieved through a chapter 11 plan of reorganization (the “ Restructuring ”);

 

WHEREAS, in accordance with and subject to the terms and conditions set forth below and in the other Restructuring Support Documents, the Parties have agreed to the basic terms of the Restructuring;

 

WHEREAS, Accuride intends to (i) commence voluntary cases (collectively, the “ Chapter 11 Cases ”) under chapter 11 of title 11 of the United States Code (the “ Bankruptcy Code ”) in the United States Bankruptcy Court for the district of Delaware (the “ Bankruptcy Court ”), (ii) file and use commercially reasonable efforts to obtain confirmation by the Bankruptcy Court of a plan of reorganization in the Chapter 11 Case that implements the terms of the Restructuring (such plan of reorganization, the “ Chapter 11 Plan ”), and (iii) file and use commercially reasonable efforts to obtain approval by the Bankruptcy Court of a disclosure statement and related materials for the Chapter 11 Plan (the “ Disclosure Statement ”);

 

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WHEREAS, the Supporting Lenders have agreed to support (i) the commencement of the Chapter 11 Cases by the Debtors, (ii) confirmation by the Bankruptcy Court of the Chapter 11 Plan, and (iii) approval by the Bankruptcy Court of the Disclosure Statement, in each case on the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as follows:

 

Section 1.                General .  Each of the Parties agrees and covenants that, subject to the terms and conditions set forth in the Restructuring Support Documents, so long as this Agreement has not been terminated:

 

(a)            it will negotiate in good faith (i) the documentation regarding the Restructuring or otherwise contemplated by the Restructuring Support Documents, (ii) the Chapter 11 Plan, and (iii) the other documents contemplated hereby and thereby;

 

(b)            subject to Section 11 hereof, it will not (i) object to, delay, impede, commence any proceeding, or take any other action to interfere, directly or indirectly, in any material respect with the acceptance or implementation of the Chapter 11 Plan, (ii) encourage or support any person or entity to do any of the foregoing, (iii) in the case of the Supporting Lenders, exercise any rights under the Pre-Petition Credit Agreement or any other Loan Document or instruct the Administrative Agent to exercise any such rights except to the extent not inconsistent with this Agreement, or (iv) propose, file, support, vote for, consent to or instruct any person or entity concerning any restructuring, workout, plan of reorganization, dissolution, winding up, or liquidation of the Debtors, other than the Chapter 11 Plan; provided , that any Party shall be able to enforce the terms of this Agreement and the other Restructuring Support Documents; and

 

(c)            it will use commercially reasonable efforts to take or cause to be taken all actions commercially reasonably necessary to confirm and consummate the Chapter 11 Plan on the terms and subject to the conditions set forth in the Restructuring Support Documents.

 

Section 2.                Condition to Effectiveness .

 

The effectiveness of this Agreement shall be subject to the satisfaction of the following conditions prior to the commencement of the Chapter 11 Cases:

 

(a)            the receipt by counsel to the Administrative Agent of Accuride’s executed counterpart signature pages to this Agreement;

 

(b)            the receipt by Accuride or its counsel of counterpart signature pages to this Agreement duly executed and delivered by the Supporting Lenders who hold at least fifty percent (50%) of the aggregate principal amount of the “First Out Loan Obligations” outstanding under the Pre-Petition Credit Agreement;

 

(c)            the receipt by the Administrative Agent or its counsel of evidence satisfactory to the Supporting Lenders that Accuride has entered into the Noteholder

 

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Restructuring Support Agreement with holders of the Notes representing at least two-thirds of the aggregate principal face amount of the Notes; and

 

(d)               the Noteholder Restructuring Support Agreement and the letter executed by sufficient holders of the Notes so as to subscribe to the backstop evidencing their commitment to provide new capital to Accuride (together, with all related term sheets, the “ Noteholder Commitment Letter ”) shall each be duly executed by all applicable Noteholders and on terms and conditions reasonably satisfactory to the Supporting Lenders, and shall be valid, enforceable and binding in accordance with their terms.

 

For avoidance of doubt, any counterpart purported to be executed by any Lender after the Chapter 11 Commencement Date but prior to the approval of the Disclosure Statement by the Bankruptcy Court shall be deemed null and void for all purposes.

 

Section 3.                Support for the Chapter 11 Plan .

 

(a)                Accuride agrees and covenants that (i) in connection with the commencement of the Chapter 11 Cases, it shall (A) use commercially reasonable efforts to file the Chapter 11 Plan prior to the applicable termination date set forth in Section 6(b), (B) use commercially reasonable efforts to seek approval of the Disclosure Statement by the Bankruptcy Court, (C) upon Bankruptcy Court approval of the Disclosure Statement, use commercially reasonable efforts to solicit acceptance of the Chapter 11 Plan, and (D) take all other commercially reasonably necessary actions to support and obtain confirmation of the Chapter 11 Plan, (ii) it shall use commercially reasonable efforts to obtain an order from the Bankruptcy Court granting adequate protection to the Lenders in the form of, among other things, replacement liens, superpriority claims, and continuing monthly and other payment by Accuride of the interest and fees in respect of the Senior Secured Obligations, and the fees and expenses of Houlihan Lokey and White & Case LLP, as the respective financial and legal advisors to the Administrative Agent, and such foreign counsel and local counsel as the Administrative Agent has retained or shall retain, and such other fees and expenses as set forth in the various Restructuring Support Documents, in each case, as provided in the draft interim order approving the DIP Financing (defined below) and use of cash collateral (substantially and in all material respects in the form attached hereto as Exhibit B, the “ Interim DIP Order ”), which has been approved by the Administrative Agent, GE Capital, Eaton Vance and Fifth Third (together, the “ Steering Committee ”), and (iii) the terms of any financial restructuring or recapitalization of Accuride and/or any of its subsidiaries, as set forth in any document executed by Accuride in connection with the Restructuring, shall be consistent with the terms set forth in the Restructuring Support Documents; in each case (i), (ii), and (iii) so long as this Agreement has not been validly terminated in accordance with Sections 6 or 7 hereof.

 

(b)               Each of the Supporting Lenders agrees and covenants (severally and not jointly) that it shall (i) following receipt of the Disclosure Statement and other solicitation materials approved by the Bankruptcy Court, exercise all votes to which it is entitled with respect to its respective Senior Secured Obligations to accept the Chapter 11 Plan in the Chapter 11 Cases and, if any, each separately balloted release of the other Parties included in the Chapter 11 Plan (and will not withdraw or change such votes), (ii) not object to any first day motions to be filed by any of the Debtors in connection with the Chapter 11 Cases as set forth on Schedule I

 

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hereto (collectively, the “ First Day Motions ”), and (iii) consent to the use of cash collateral by the Debtors in the Bankruptcy Case in accordance with (x) the Interim DIP Order or (y) any final order approving the DIP Financing on terms and conditions reasonably satisfactory to DBTCA, as administrative agent under the DIP Financing (in such capacity, the “ DIP Agent ”), and the Steering Committee entered by the Bankruptcy Court (each as may be amended, supplemented, modified or replaced from time to time in accordance with the terms thereof, and collectively, the “ DIP Financing Order ”), and all applicable DIP Financing documentation, including the Senior Secured Superpriority Debtor-in-Possession ABL Credit Agreement (as amended, restated, supplemented or otherwise modified in accordance with the terms thereof, the “ DIP Credit Agreement ”) attached to the Interim Order as Exhibit A; in each case (i), (ii) and (iii) so long as this Agreement has not been validly terminated in accordance with Sections 6 or 7 hereof.  Each of the Supporting Lenders acknowledges that the Disclosure Statement, the Chapter 11 Plan and any other documents contemplated thereby or related thereto (the “ Definitive Documents ”; each of the Parties acknowledges that the Restructuring Support Documents do not contain all terms and detail that would be contained in the Definitive Documents and that such additional terms and detail shall be subject to mutual agreement) may require amendment or supplement in the course of acceptance and implementation of the Chapter 11 Plan, and hereby agrees that any such amendment or supplement that has been approved in writing by the Requisite Independent Supporting Lenders (as defined below) shall not affect such Supporting Lender’s obligations hereunder, which obligations shall continue to apply in the same manner and to the same extent with respect to the Definitive Documents, as the same may have been so amended or supplemented. Notwithstanding anything to the contrary set forth herein, each Supporting Lender shall have the right to (x) object to or oppose any proposed Definitive Document, or amendments, modifications or supplements to any Definitive Document, that are inconsistent with the terms and conditions of the Restructuring Support Documents or the Restructuring, or with any other Definitive Document to which it is a party or beneficiary or to any agreement regarding financing of debt or equity to be provided to the Debtors or their affiliates which is inconsistent with the Restructuring Support Documents or (y) take any action from time to time to enforce its rights hereunder or thereunder.

 

Section 4.                Representations and Warranties .

 

(a)                Accuride represents and warrants to each of the other Parties that the following statements are true and correct as of the date hereof:

 

(1)            Power and Authority .  It has all requisite power and authority to enter into this Agreement and to carry out the transactions contemplated by, and perform its respective obligations under, this Agreement.

 

(2)            Authorization .  The execution and delivery of this Agreement and the performance of its obligations hereunder have been duly authorized by all necessary action on its part.

 

(3)            No Conflicts .  The execution, delivery, and performance by it of this Agreement do not and shall not (i) violate any provision of its certificate of incorporation or by-laws (or other organizational documents) or any law, rule, or regulation applicable to it or (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a

 

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default under any material contractual obligation to which it is a party or under its certificate of incorporation or by-laws (or other organizational documents), except, with respect to any Debtor, for any contractual obligation that would not have a material adverse effect on the business, assets, financial condition, or results of operations of the Debtors, taken as a whole.

 

(4)            Governmental Consents .  The execution, delivery, and performance by it of this Agreement do not and shall not require any registration or filing with, consent or approval of, notice to, or other action to, with, or by, any Federal, state, or other governmental authority or regulatory body, except (i) such filings as may be necessary and/or required for disclosure by the Securities and Exchange Commission, (ii) the filing of a premerger notification and report form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, including the rules and regulations promulgated thereunder, (iii) any filings in connection with the Chapter 11 Cases, including the approval of the Disclosure Statement and confirmation of the Chapter 11 Plan, (iv) filings of amended certificates of incorporation or formation or other organizational documents with applicable state authorities, and (v) other registrations, filings, consents, approvals, notices, or other actions that are reasonably necessary to maintain permits, licenses, qualifications, and governmental approvals to carry on the businesses of Accuride.

 

(5)            Binding Obligation .  This Agreement is the legally valid, and binding obligation of it, enforceable against it in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.

 

(6)            Proceedings .   No litigation or proceeding before any court, arbitrator, or administrative or governmental body is pending against it that would adversely affect its ability to enter into this Agreement or perform its obligations hereunder.

 

(7)            Accuracy of Information . All information, other than financial projections (the “ Projections ”), that has been made available to the Lenders by Accuride or any of their representatives was as of the date furnished and, to Accuride’s knowledge, is as of the date of the Agreement, when taken together as a whole, complete and correct in all material respects and did not as of the date furnished and, to Accuride’s knowledge, does not as of the date of this Agreement contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in light of the circumstances under which such statements were made.  All information, other than Projections, that is made available in the future to the Lenders by Accuride or any of their representatives will be, as of the date such information is furnished to the Lenders, when taken together as a whole, complete and correct in all material respects and will not, as of such date, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in light of the circumstances under which such statements are made.  The Projections that have been or will be prepared and made available to the Lenders by Accuride or any of its representatives, including but not limited to those contained in the presentation entitled “Private Lender Supplement,” dated July 2009 (the “ July Projections ”) have been or will be prepared in good faith based upon reasonable assumptions at the time made, and Accuride did not have any knowledge when it prepared and delivered such Projections, and does

 

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not have any knowledge as of the date hereof, of any fact or information that would lead it to believe that such assumptions are incorrect or misleading in any material respect (and will not deliver any Projections in the future with such knowledge).  As of the date of this Agreement, the July Projections are the most up-to-date projections being used as a base case by the management of Accuride.

 

(b)               Each of the Supporting Lenders represents and warrants, severally and not jointly, to each of the other Parties that the following statements are true, correct, and complete as of the date hereof:

 

(1)            Power and Authority .  It has all requisite power and authority to enter into this Agreement and to carry out the transactions contemplated by, and perform its respective obligations under, this Agreement.

 

(2)            Authorization .  The execution and delivery of this Agreement and the performance of its obligations hereunder have been duly authorized by all necessary action on its part.

 

(3)            Governmental Consents .  The execution, delivery, and performance by it of this Agreement do not and shall not require any registration or filing with, consent or approval of, or notice to, or other action to, with, or by, any Federal, state, or other governmental authority or regulatory body, except (i) such filings as may be necessary and/or required for disclosure by the Securities and Exchange Commission and (ii) any filings in connection with the Chapter 11 Cases, including the approval of the Disclosure Statement and confirmation of the Chapter 11 Plan.

 

(4)            Binding Obligation .  This Agreement is the legally valid, and binding obligation of it, enforceable against it in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.

 

(5)            Ownership .  It is (i) the sole beneficial owner of the aggregate principal amount of the Senior Secured Obligations separately disclosed to Accuride on a confidential basis ( provided that the aggregate amount of the holdings of all the Supporting Lenders shall not be deemed confidential), as the case may be, and/or the investment advisor or manager for the beneficial owners of such Senior Secured Obligations, having the power to vote and dispose of such Senior Secured Obligations on behalf of such beneficial owners, and (ii) entitled (for its own account or for the account of other persons claiming through it) to all of the rights and economic benefits of such Senior Secured Obligations.

 

(6)            Transfers .  It has made no prior assignment, sale, participation, grant, conveyance, or other transfer of, and has not entered into any other agreement to assign, sell, participate, grant, or otherwise transfer, in whole or in part, any portion of its right, title, or interests in the Senior Secured Obligations presently beneficially owned by it or managed by it as investment advisor or manager.

 

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Section 5.                Covenants .  Each Supporting Lender individually (and not jointly) covenants that, during the period commencing on the date hereof and ending upon the effective date of the Chapter 11 Plan (the “ Effective Date ”) or the earlier termination of this Agreement pursuant to the terms hereof, such Supporting Lender shall not, directly or indirectly, sell, pledge, hypothecate, or otherwise transfer any Senior Secured Obligations that are subject to the terms hereof or any option, right to acquire, or voting, participation, or other interest therein, except to a purchaser or other entity who executes and delivers to Accuride prior to the time of settlement of such trade or transfer an agreement in writing to be bound by all the terms of this Agreement with respect to the relevant Senior Secured Obligations or other interests being transferred to such purchaser (which agreement shall include the representations and warranties set forth in Section 4(b) hereof). Any such transfer in violation hereof shall be null and void to the fullest extent permitted by law. No selling Supporting Lender shall have any liability under this Agreement arising from or related to the failure of its transferee to comply with the terms of this Agreement. This Agreement shall in no way be construed to preclude a Supporting Lender from acquiring additional Senior Secured Obligations or other interests in any Debtor; provided , however , that any such additional Senior Secured Obligations and other interests in such Debtor shall automatically be deemed to be subject to all the terms of this Agreement.

 

Section 6.                Termination by the Requisite Independent Supporting Lenders .  This Agreement may be terminated by the Supporting Lenders who are not also Noteholders or affiliated (including in a family of funds) or under common management with a Noteholder (the “ Independent Supporting Lenders ”) and who hold at least seventy-five percent (75%) of the aggregate principal amount of Senior Secured Obligations held by all Independent Supporting Lenders (the “ Requisite Independent Supporting Lenders ”) on the occurrence of any of the following events (each a “ Lender Termination Event ”), by delivering written notice of the occurrence of such event in accordance with Section 16 below to the other Parties ( provided that in the event of a Lender Termination Event under subparagraph (v) of this Section 6, this Agreement shall terminate automatically, without written notice, upon the occurrence of such Lender Termination Event):

 

(a)                the Debtors shall not have provided the Administrative Agent prior to the Chapter 11 Commencement Date (defined below), with evidence of the Debtors’ corporate authority to file voluntary petitions under the Bankruptcy Code and copy(ies) of duly approved (and not rescinded or modified) resolutions of the Debtors’ board(s) of director approving this Agreement and the other Restructuring Support Documents and authorizing and directing the Debtors to comply with and carry out the terms thereof;

 

(b)                the Debtors shall not have filed petitions commencing the Chapter 11 Cases by October 9, 2009 (the date of the filing of petitions, the “ Chapter 11 Commencement Date ”);

 

(c)                Accuride shall not have obtained entry of the Interim DIP Order approving on an interim basis post-petition debtor-in-possession financing (“ DIP Financing ”) and use of cash collateral within five (5) days after the Chapter 11 Commencement Date or obtained a final order approving DIP Financing and use of cash collateral on such terms and conditions as are reasonably satisfactory to the DIP Agent and the Requisite Independent Supporting Lenders, within forty-five (45) days after the Chapter 11 Commencement Date;

 

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(d)               the Debtors shall not have provided the Supporting Lenders with drafts of the Disclosure Statement and the Chapter 11 Plan by the date that is thirty (30) days after the Chapter 11 Commencement Date;

 

(e)                the Debtors shall not have filed the Disclosure Statement and the Chapter 11 Plan by the date that is fifty-five (55) days after the Chapter 11 Commencement Date;

 

(f)                the entry of a order by the Bankruptcy Court approving the Disclosure Statement together with the solicitation, balloting and voting procedures and other related relief, in form and substance acceptable to the Requisite Independent Supporting Lenders shall not have occurred by the date that is ninety (90) days after the Chapter 11 Commencement Date;

 

(g)               the entry by the Bankruptcy Court of a final order or orders reasonably satisfactory to the Requisite Independent Supporting Lenders confirming the Chapter 11 Plan pursuant to section 1129 of the Bankruptcy Code shall not have occurred by the date that is one hundred seventy-five (175) days after the Chapter 11 Commencement Date;

 

(h)               the effective date of the Chapter 11 Plan shall not have occurred by the date that is one hundred ninety (190) days after the Chapter 11 Commencement Date;

 

(i)                 the Chapter 11 Plan does not conform in all economic and other material respects to the Term Sheets constituting Restructuring Support Documents;

 

(j)                 any Debtor shall have withdrawn the Chapter 11 Plan without the consent of the Requisite Independent Supporting Lenders;

 

(k)                the terms of the Chapter 11 Plan and the exhibits and any supplements thereto not otherwise set forth on the Term Sheets, including any amendment or modification of any of the foregoing, shall not be in form or substance reasonably acceptable to the Requisite Independent Supporting Lenders;

 

(l)                 an order dismissing or converting the Chapter 11 Case of any of the Debtors to a case under chapter 7 of the Bankruptcy Code is entered by the Bankruptcy Court;

 

(m)               the Debtors’ exclusive right to file a chapter 11 plan pursuant to section 1121 of the Bankruptcy Code shall have terminated;

 

(n)               any court of competent jurisdiction or other competent governmental or regulatory authority issues a ruling, determination, or order making illegal or otherwise restricting, preventing or prohibiting the consummation of the Restructuring substantially on the terms set forth in the Restructuring Support Documents, including an order of the Bankruptcy Court denying confirmation of the Chapter 11 Plan, which ruling, determination or order (i) has been in effect for 30 days and (ii) is not stayed;

 

(o)               Accuride shall have (i) materially breached its obligations under this Agreement and such breach is not cured (to the extent curable) within five (5) Business Days after first being aware of such breach or the giving of written notice by the Requisite Independent Supporting Lenders to Accuride of such breach (whichever is earlier) or (ii) filed or

 

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publicly announced its intention to file a chapter 11 plan that contains terms and conditions that (A) do not provide the Lenders with the economic recovery set forth in the Restructuring Support Documents and (B) are not otherwise consistent with the Restructuring;

 

(p)               the entry of an order by the Bankruptcy Court appointing an examiner with enlarged powers relating to the operation of the material part of the business of the Debtors, taken as a whole (powers beyond those set forth in section 1106(a)(3) and (4) of the Bankruptcy Code) under section 1106(b) of the Bankruptcy Code, or the entry of an order by the Bankruptcy Court appointing a trustee under section 1104 of the Bankruptcy Code;

 

(q)               any of the Debtors shall file a motion or the Bankruptcy Court shall enter an order approving a payment to any party (whether in cash or other property or whether as adequate protection, settlement of a dispute, or otherwise) that would be inconsistent with the treatment of such party under the applicable Restructuring Support Documents;

 

(r)                the entry of an order dismissing one or more of the Debtors’ Chapter 11 Cases;

 

(s)                there shall have occurred (A) a material adverse change, based on events occurring subsequent to the date of this Agreement, in the Debtors’ business, assets, operations, liabilities or financial condition or (B) since the date of this Agreement, any loss of a significant portion of the business of any of Daimler Truck North America, LLC, PACCAR, Inc., International Truck and Engine Corporation or Volvo Truck Corporation;

 

(t)                the occurrence of a “Termination Date” under the DIP Financing Order, the DIP Credit Agreement or the other DIP Financing documentation, and the enforcement by the DIP Agent of any of its rights and remedies thereunder;

 

(u)               Accuride shall make a public announcement that it intends to support or supports, or enters into an agreement to support, or files any pleading or document with the Bankruptcy Court indicating its intention to support or support of, a Competing Transaction (defined below), or Accuride enters into a Competing Transaction;

 

(v)               the Noteholder Restructuring Support Agreement or the obligations of the holders of Notes under the Noteholder Commitment Letter shall have been terminated by any of the parties thereto for whatever reason;

 

(w)               any documentation relating to the transactions contemplated hereby, including but not limited to pleadings and court orders, shall not be in form and substance reasonably satisfactory to the Requisite Independent Supporting Lenders;

 

(x)                any order required to be entered by the Bankruptcy Court under this Section 6 on a final basis shall not become a final order within a reasonable period of time; or

 

(y)               the Chapter 11 Plan does not receive the requisite number of votes accepting such Plan in number and amount in the class of claims in which the Lenders’ claims are placed.

 

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As used herein, “ Business Day ” means a day (other than a Saturday or Sunday) on which banks are open for general business in New York City.

 

Section 7.                Termination by Accuride .

 

Upon the occurrence of either of the following events, Accuride may terminate this Agreement (a “ Company Termination Event ”, and together with a Lender Termination Event, a “ Termination Event ”) by giving written notice thereof to the other Parties:

 

(a)                there shall have been a material breach of this Agreement by at least two Independent Supporting Lenders who together hold more than thirty-four percent (34%) of the aggregate principal amount of Senior Secured Obligations held by all Independent Supporting Lenders; or

 

(b)               in order to enter into a Superior Transaction (as defined below) or an agreement to support a Superior Transaction.

 

Section 8.                Effect of Termination and of Waiver of Termination Event .  On the delivery of the written notice referred to in Sections 6 or 7 in connection with the valid termination of this Agreement, the obligations of each of the Parties hereunder shall thereupon terminate and be of no further force and effect.  Prior to the delivery of such notice the Requisite Independent Supporting Lenders may waive the occurrence of a Lender Termination Event and Accuride may waive the occurrence of a Company Termination Event.  No such waiver shall affect any subsequent Termination Event or impair any right consequent thereon.  Upon termination of this Agreement, no Party (or any other party) shall have any continuing liability or obligation to the other Parties hereunder; provided , however , that no such termination shall relieve any Party from liability for its breach or non-performance of its obligations hereunder prior to the date of such termination.

 

Section 9.                Supporting Lender Direction of the Administrative Agent .  Each Supporting Lender hereby authorizes and directs the Administrative Agent, and the Administrative Agent hereby accepts such authorization and direction, to (i) execute and deliver, perform all its obligations under, and take all other actions contemplated by or permitted under the Definitive Documents to which the Administrative Agent is a party, and (ii) take all actions necessary to amend, waive, supplement or otherwise modify the Chapter 11 Plan and the Definitive Documents in any manner that either (x) has been approved in writing by the Requisite Independent Supporting Lenders or (y) does not constitute a material adverse change in respect of the treatment of the Senior Secured Obligations or the transactions contemplated by the Chapter 11 Plan as they affect such Supporting Lender.  In connection therewith, Accuride and each Supporting Lender agrees and acknowledges that the Administrative Agent shall have all rights, powers and privileges granted to the Administrative Agent in the Pre-Petition Credit Agreement and the other Loan Documents.  Accuride and each Supporting Lender further agrees and acknowledges that with respect to any and all actions (including, without limitation, any and all actions contemplated hereunder) taken or not taken by the Administrative Agent under the Definitive Documents to which the Administrative Agent is a party, the Administrative Agent shall retain its rights to be compensated, reimbursed and indemnified pursuant to the terms of the Pre-Petition Credit Agreement and the other Loan Documents, including for all reasonable out-

 

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of-pocket expenses incurred by the Administrative Agent (including the reasonable fees, charges and disbursements of counsel for the Administrative Agent) in connection with the preparation and negotiation of the Definitive Documents to which the Administrative Agent is a party, the transactions contemplated thereby and the actions taken by the Administrative Agent thereunder.  Notwithstanding anything to the contrary provided in this Agreement, the rights, powers and privileges granted to the Administrative Agent as described in the preceding two sentences of this Section 9 shall survive the termination of this Agreement.

 

Section 10.              Supporting Lender Consent to DIP Financing .  The Supporting Lenders hereby consent to the Debtors obtaining DIP Financing from certain of the Supporting Lenders contemplated by, and on the term and conditions consistent with, or more favorable than, the DIP Financing Order or the DIP Credit Agreement, or on such other terms and conditions reasonably satisfactory to the Requisite Independent Supporting Lenders.  To the extent that the Requisite Independent Supporting Lenders do not consent to the DIP Financing, the Debtors may seek a determination by the Bankruptcy Court in the Chapter 11 Cases with respect to the issue of reasonableness.  For the avoidance of doubt, nothing in this Agreement may be construed as a commitment by any Lender to provide the DIP Financing.

 

Section 11.              Competing Transactions .  From the date of this Agreement to the Effective Date or earlier termination of this Agreement, Accuride shall not make a public announcement that it intends to support or supports, enter into an agreement to support, or file any pleading or document with the Bankruptcy Court evidencing its intention to support, or otherwise knowingly support, any transaction inconsistent with the Restructuring Support Documents, the Restructuring or the Chapter 11 Plan, shall not file any plan that is not the Chapter 11 Plan and shall not agree to, consent to, knowingly provide any support to, solicit, participate in the formulation of, or vote for any transaction or plan of reorganization other than the Chapter 11 Plan (a “ Competing Transaction ”).   Notwithstanding anything to the contrary herein, or in the Chapter 11 Plan or any other agreement among Accuride and the Lenders, at any time prior to the date on which the Chapter 11 Plan is confirmed by the Bankruptcy Court, if Accuride has received a bona fide written proposal for a Competing Transaction that the special committee of the board of directors of Accuride or, if the special committee is no longer in existence, the board of directors of Accuride determines in good faith is or could reasonably be expected to lead to a Superior Transaction and that the failure of the board of directors to pursue such Competing Transaction could reasonably be expected to result in a breach of the board of directors’ fiduciary duties under applicable law, then Accuride may (a) furnish non-public information to, and engage in discussions and negotiations with, the person making such proposal and its representatives with respect to the Competing Transaction, and (b) terminate this Agreement pursuant to Section 7(b) in order to enter into a Superior Transaction or an agreement to support a Superior Transaction.  For purposes of this Agreement, a “ Superior Transaction ” shall be a Competing Transaction that the special committee of the board of directors of Accuride or, if the special committee is no longer in existence, the board of directors of Accuride determines in the good faith exercise of its fiduciary duties (x) would be in the best interests of Accuride and its creditor constituencies and equity holders as a whole, including, but not limited to the Lenders, and (y) would reasonably be expected to provide a superior recovery (but, with respect to any creditor constituent, not in excess of its claim) to each creditor constituency and equity holders.  At all times prior to, on, or after the date of the commencement of the Chapter 11 Cases, Accuride shall be obligated to promptly deliver to the advisors for the Administrative Agent all

 

12

 

written communications delivered to or received by Accuride or its advisors making or materially modifying any proposals with respect to any Competing Transaction, including, without limitation, copies of all expressions of interest, term sheets, letters of interest, offers, proposed agreements or otherwise, and shall periodically update (not less than once every week) the advisors for the Supporting Lenders concerning such matters.

 

Section 12.              General Releases .  For purposes of this Section 12, “Released Party” means each Lender (including the Administrative Agent on behalf of the Lenders and in its capacity as an individual Lender) and each of their respective direct or indirect subsidiaries, current and former officers and directors, managers, members, employees, agents, representatives, financial advisors, professionals, accountants and attorneys, and each of their predecessors, successors, and assigns.

 

(a)            As of the confirmation date of the Chapter 11 Plan, but subject to the occurrence of the Effective Date, for good and valuable consideration, the adequacy of which is hereby confirmed, the Debtors and any person seeking to exercise the rights of the Debtors’ estates, including, without limitation, any successor to the Debtors or any estate representative appointed or selected (including pursuant to sections 701, 702, 703 or 1123(b)(3) of the Bankruptcy Code), shall be deemed (and the Debtors shall cause their non-Debtor affiliates)  to unconditionally, forever release, waive, and discharge each Released Party, from any and all Claims, obligations, suits, judgments, damages, demands, debts, rights, causes of action, and liabilities whatsoever in connection with or related in any way to the Debtors, the operation of the Debtors’ business, the incurrence by the Debtors of any indebtedness or the use of proceeds thereof, the Pre-Petition Credit Agreement, the Chapter 11 Cases, and the Chapter 11 Plan, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, then existing or thereafter arising, in law, equity, or otherwise, that are based in whole or part on any act, omission, transaction, event, or other occurrence taking place on or prior to the Effective Date; provided , however, that (i) nothing in this Section 12 shall be deemed to waive or modify in any manner any written agreement entered into by a Released Party on or after the date of this Agreement, or any claims, obligations, suits, judgments, damages, demands, debts, rights, causes of action, and liabilities arising thereunder, (ii) the foregoing shall not operate as a waiver or release from any causes of action based on gross negligence, intentional fraud, or criminal misconduct, in each case as determined by a final order entered by a court of competent jurisdiction, and (iii) nothing in this Section 12 shall be deemed to waive or release the rights of the Debtors to enforce this Agreement or its rights under the Chapter 11 Plan and the contracts, instruments, indentures, and other agreements or documents delivered or assumed thereunder or in connection therewith.

 

(b)            Without limiting the generality of the foregoing, or the effect of the DIP Financing Order, as of the Effective Date, the Debtors shall be deemed to have waived the right to prosecute, and to have settled and released for fair value, any avoidance or recovery actions under sections 545, 547, 548, 549, 550, 551, and 553 of the Bankruptcy Code or other applicable law that belong to the Debtors and/or which the Debtors could have prosecuted as debtors or debtors in possession against the Released Parties relating to distributions made on account of principal, interest, fees or other obligations under and relating to the claims arising under or in connection with the Pre-Petition Credit Agreement, or fees or expense reimbursements whether brought under the Bankruptcy Code or other applicable law.

 

13

 

(c)           In the event that any Party or any of its successors or assigns (i) consolidates with or merges into any other person or entity and is not the continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers or conveys all or substantially all of its properties and assets to any person or entity, then, and in each such case, proper provision shall be made so that the successors and assigns of such Party shall assume all of the obligations thereof set forth in this Section 12.

 

(d)           The obligations of the Debtors under this Section 12 shall not be terminated or modified in such a manner as to adversely affect any Released Party to whom this Section 12 applies without the consent of the affected Released Party (it being expressly agreed that the Released Parties to whom this Section 12 applies shall be third party beneficiaries of this Section 12).

 

(e)           For the avoidance of doubt, the Chapter 11 Plan shall include and incorporate the foregoing release and the Debtors shall use their commercially reasonable best efforts to obtain Bankruptcy Court approval thereof; provided, however, that the failure of the Bankruptcy Court to approve the foregoing release shall not affect the other provisions of this Agreement or the Supporting Lenders’ obligations thereunder.

 

Section 13.             Amendments .  This Agreement may not be modified, amended, or supplemented except in writing signed by Accuride and the Requisite Independent Supporting Lenders, except that, notwithstanding anything to the contrary set forth herein, any change to (i) the economic terms of the Chapter 11 Plan that would adversely affect the Supporting Lenders, or (ii) this Section 13 of the Agreement, shall also require the consent of each Supporting Lender, and if such consent is not obtained, such non-consenting Supporting Lender shall have no further obligations whatsoever under this Agreement.

 

Section 14.             Governing Law; Jurisdiction .  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, regardless of the laws that might otherwise govern under applicable principles of conflict of laws of the State of New York.  By its execution and delivery of this Agreement, each of the Parties hereto hereby irrevocably and unconditionally agrees for itself that any legal action, suit, or proceeding against it with respect to any matter under or arising out of or in connection with this Agreement or for recognition or enforcement of any judgment rendered in any such action, suit, or proceeding, shall be brought in a federal court of competent jurisdiction in the Southern District of New York.  By execution and delivery of this Agreement, each of the Parties hereto hereby irrevocably accepts and submits to the nonexclusive jurisdiction of such court, generally and unconditionally, with respect to any such action, suit, or proceeding.  Notwithstanding the foregoing consent to jurisdiction, upon the commencement of the Chapter 11 Cases, each of the Parties hereto hereby agrees that the Bankruptcy Court shall have exclusive jurisdiction over all matters arising out of or in connection with this Agreement.

 

Section 15.             WAIVER OF RIGHT TO TRIAL BY JURY .  EACH OF THE PARTIES WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, BETWEEN ANY OF THEM ARISING OUT OF, CONNECTED WITH, RELATING TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN ANY OF THEM IN CONNECTION

 

14

 

WITH THIS AGREEMENT.  INSTEAD, ANY DISPUTES RESOLVED IN COURT SHALL BE RESOLVED IN A BENCH TRIAL WITHOUT A JURY.

 

Section 16.             Notices .  All demands, notices, requests, consents, and communications hereunder shall be in writing and shall be deemed to have been duly given if delivered personally or by courier service, messenger, facsimile, telecopy, or if duly deposited in the mails, by certified or registered mail, postage prepaid-return receipt requested, and shall be deemed to have been duly given or made (i) upon delivery, if delivered personally or by courier service, or messenger, in each case with record of receipt, (ii) upon transmission with confirmed delivery, if sent by facsimile or telecopy, or (iii) two Business Days after being sent by certified or registered mail, postage pre-paid, return receipt requested, to the following addresses, or such other addresses as may be furnished hereafter by notice in writing, to the following Parties:

 

If to Accuride to:
Accuride Corporation
77140 Office Circle
Evansville, IN 47715
Attention: Steve Martin, Esq.
Facsimile: (812) 962-5470
with a copy to:
Latham & Watkins LLP
Sears Tower, Suite 5800
233 South Wacker Drive
Chicago, IL 60606
Attn:	David S. Heller, Esq.
	Bradley Faris, Esq.
Facsimile: (312) 993-9767
If to the Supporting Lenders, or any one Supporting Lender, at their respective addresses on the signature pages hereto, with copies to:
White & Case LLP
1155 Avenue of the Americas
New York, NY 10036
Attn:	Alan Rockwell, Esq.
	Scott Greissman, Esq.
Facsimile: (212) 354-8113

 

Section 17.             Entire Agreement .  This Agreement, including the Restructuring Support Documents and each of the other exhibits and schedules annexed hereto, constitutes the full and entire understanding and agreement among the Parties with regard to the subject matter hereof, and supersedes all prior negotiations, agreements and understandings , whether written or oral, among the Parties with respect to the subject matter hereof; provided, however , that any confidentiality agreement executed by any Supporting Lender shall survive this Agreement and

 

15

 

shall continue to be in full force and effect, in accordance with the terms thereof, irrespective of the terms hereof; provided, further , that the Parties shall enter into various definitive documents upon the effective date of the Chapter 11 Plan to give effect to the transactions contemplated in this Agreement.

 

Section 18.             Continued Banking Practices .  Notwithstanding anything herein to the contrary, each Supporting Lender and its affiliates may accept deposits from, lend money to, and generally engage in any kind of banking, investment banking, trust or other business with, or provide debtor in possession financing, other debt financing, equity capital or other services (including financial advisory services) to any Debtor or any affiliate of any Debtor or any other person, including, but not limited to, any person proposing or entering into a transaction related to or involving any Debtor or any affiliate thereof.

 

Section 19.             Reservation of Rights .

 

(a)           Except as expressly provided in this Agreement, nothing herein is intended to, does or shall be deemed in any manner to waiver, limit, impair or restrict the ability of each of the Supporting Lenders to protect and preserve its rights, remedies and interests, including, but not limited to, all of its rights and remedies under the Pre-Petition Credit Agreement and, to the extent applicable, any DIP Financing facility with the Debtors and any orders of the Bankruptcy Court relating thereto, including any such rights and remedies relating to defaults or other events that may have occurred prior to the execution of this Agreement, any and all of its claims and causes of action against any of the Debtors or any third parties, or its full participation in the Chapter 11 Cases.

 

(b)           Without limiting Section 19(a) of this Agreement in any way, if the transactions contemplated by the Restructuring Support Documents are not consummated as provided herein or if this Agreement is otherwise terminated for any reason, the Parties each fully reserve any and all of their respective rights, remedies and interests under the Pre-Petition Credit Agreement, any Definitive Document, applicable law and in equity.

 

Section 20.             Fiduciary Obligations .  Notwithstanding anything to the contrary herein, nothing in this Agreement shall require any of the Parties or any of their respective directors or officers (in such person’s capacity as a director or officer) to take any action, or to refrain from taking any action, to the extent that taking such action or refraining from taking such action would be inconsistent with such person’s fiduciary obligations under applicable law.

 

Section 21.             Headings .  The headings of the paragraphs and subparagraphs of this Agreement are inserted for convenience only and shall not affect the interpretation hereof.

 

Section 22.             Successors and Assigns .  This Agreement is intended to bind and inure to the benefit of the Parties and their respective permitted successors and assigns, provided , however , that nothing contained in this paragraph shall be deemed to permit sales, assignments, or transfers other than in accordance with Section 5.

 

Section 23.             Specific Performance .  Each Party hereto recognizes and acknowledges that a breach by it of any covenants or agreements contained in this Agreement will cause other parties to sustain damages for which such parties would not have an adequate remedy at law for

 

16

 

money damages, and therefore each Party hereto agrees that in the event of any such breach, such other parties shall be entitled to the remedy of specific performance of such covenants and agreements and injunctive and other equitable relief in addition to any other remedy to which such parties may be entitled, at law or in equity.

 

Section 24.             Several, Not Joint, Obligations .  The agreements, representations, and obligations of the Parties under this Agreement are, in all respects, several and not joint.

 

Section 25.             Remedies Cumulative .  All rights, powers, and remedies provided under this Agreement or otherwise available in respect hereof at law or in equity shall be cumulative and not alternative, and the exercise of any right, power, or remedy thereof by any party shall not preclude the simultaneous or later exercise of any other such right, power, or remedy by such party.

 

Section 26.             No Waiver .  The failure of any Party hereto to exercise any right, power, or remedy provided under this Agreement or otherwise available in respect hereof at law or in equity, or to insist upon compliance by any other Party hereto with its obligations hereunder, and any custom or practice of the parties at variance with the terms hereof, shall not constitute a waiver by such Party of its right to exercise any such or other right, power, or remedy or to demand such compliance.

 

Section 27.             Counterparts .  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute one and the same Agreement.  Delivery of an executed signature page of this Agreement by telecopier or email shall be as effective as delivery of a manually executed signature page of this Agreement.

 

Section 28.             Severability .  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

 

Section 29.             No Third-Party Beneficiaries .  Unless expressly stated herein, this Agreement shall be solely for the benefit of the Parties, the Released Parties and their respective successors and assigns, and no other person or entity shall be a third party beneficiary hereof.

 

Section 30.             Additional Parties .  Without in any way limiting the provisions hereof, additional Lenders may elect to become Parties by executing and delivering to Accuride a counterpart hereof.  Such additional holder shall become a Party to this Agreement as a Supporting Lender in accordance with the terms of this Agreement.

 

Section 31.             No Solicitation .  This Agreement and the transactions contemplated herein are the product of negotiations among the Parties, together with their respective representatives.  This Agreement is not intended to be, and each signatory to this Agreement acknowledges that this Agreement is not (a) an offer for the issuance, purchase, sale, exchange, hypothecation, or other transfer of securities, or the solicitation of an offer to acquire or buy securities, for purposes of the Securities Act and the Securities Exchange Act of 1934, or other applicable law, or (b) a solicitation of votes on the Chapter 11 Plan or any plan of reorganization for the purposes of sections 1125 and 1126 of the Bankruptcy Code.  The votes of the holders of claims against the

 

17

 

Debtors will not be solicited until such holders who are entitled to vote on the Plan have received the Disclosure Statement and related ballot, the Chapter 11 Plan, and other solicitation materials required under or otherwise in compliance with applicable law.

 

Section 32.             Settlement Discussions .  This Agreement and the Restructuring are part of a proposed settlement of a dispute among the Parties.  Nothing herein shall be deemed an admission of any kind.  Pursuant to Federal Rule of Evidence 408 and any applicable state rules of evidence, this Agreement and all negotiations relating thereto shall not be admissible into evidence in any proceeding other than a proceeding to enforce the terms of this Agreement.

 

Section 33.             Consideration .  It is hereby acknowledged by the Parties hereto that, other than the agreements, covenants, representations, and warranties set forth herein and in the Term Sheets, no consideration shall be due or paid to the Supporting Lenders for their agreement to vote to accept the Chapter 11 Plan in accordance with the terms and conditions of this Agreement.

 

Section 34.             Receipt of Adequate Information; Representation by Counsel .  Each Party acknowledges that it has received adequate information to enter into this Agreement and that it has been represented by counsel in connection with this Agreement and the transactions contemplated by this Agreement.  Accordingly, any rule of law or any legal decision that would provide any party with a defense to the enforcement of the terms of this Agreement against such party shall have no application and is expressly waived.  The provisions of the Agreement shall be interpreted in a reasonable manner to effect the intent of the Parties.

 

Section 35.             Public Announcements .  Except as required by applicable law or regulation, or the rules of any applicable stock exchange or regulatory body, or in filings to be made with the Bankruptcy Court, neither Accuride nor the Supporting Lenders shall, nor shall they permit any of their respective affiliates to, make any public announcement or otherwise communicate with any news media in respect of this Agreement or the transactions contemplated hereby or by the Definitive Documents without the prior consent of Accuride and counsel to the Supporting Lenders (which consent shall not be unreasonably withheld or delayed); provided, however , that notwithstanding the forgoing Accuride shall issue a press release no later than 8:00 a.m. prevailing Eastern Time on October 8, 2009, and shall promptly thereafter, file with the SEC a current report on Form 8-K filing the press release, this Agreement, the Term Sheets and the Noteholder Commitment Letter.

 

[Signature Page Follows]

 

18

 

IN WITNESS WHEREOF, the Parties hereto have duly executed and delivered this Agreement as of the date first above written.

 

			ACCURIDE CORPORATION, on behalf of itself and its direct and indirect subsidiaries listed on Schedule II hereto
			By:
			Name:
			Title:
LENDER:
By:
Name:
Title:
Aggregate Principal Amount of Senior Secured Obligations Beneficially Owned or Acting as Investment Advisor or Manager for the Beneficial Owners of such Senior Secured Obligations

 

 

$
[Address]
Facsimile:
Attn:

 

19

 

EXHIBIT A

 

TERM SHEETS

 

A-1

 

ACCURIDE CORPORATION

NON-BINDING TERM SHEET FOR PROPOSED RESTRUCTURING

 

Reference is made to those certain 8.5% Senior Subordinated Notes due 2015 (collectively, the “ Old Notes ”) issued by Accuride Corporation, a Delaware corporation (“ Accuride ”, and together with all of its direct and indirect subsidiaries, the “ Company ”).

 

For discussion purposes only, the following outline of the principal terms and conditions of a restructuring is being submitted for consideration.  The ad hoc committee (the “ Committee ”) of certain entities(1) that hold or manage the Old Notes contemplates implementing these transactions through a pre-arranged Chapter 11 case to be filed shortly after agreement on this Term Sheet is reached.  This Term Sheet and all related communications shall be deemed to be settlement negotiations and subject to Federal Rule of Evidence 408.

 

This Term Sheet replaces and supersedes all prior agreements and understandings, both written and oral, between the Committee and the Company and their respective advisors with respect to the subject matter hereof.

 

(1) The ad hoc committee consists of Blackrock Financial Management, Inc., Brigade Capital Management, LLC, Canyon Capital Advisors LLC, Principal Global Investors LLC, Sankaty Advisors, LLC and Tinicum Incorporated.

 

A-2

 

Treatment of Current Stakeholders

 

1.		Term Facility (the “ Term Facility ”) and Revolving Credit Facility (the sum of the Canadian Revolving Facility and the US Revolving Facility, together the “Revolving Credit Facility ”) under the Credit Agreement (as amended, the “ Credit Agreement ”), with Citicorp USA, Inc. as administrative agent (“ Agent ”)   (Approximately $56.07 million and $224.60 million outstanding under the Revolving Credit Facility and the Term Facility, respectively as of September 25, 2009)		The Credit Agreement shall be amended with terms and conditions, including covenants and maturities, consistent with the terms set forth in the “Senior Prepetition Debt Restructuring Term Sheet” (in the form approved by the Committee as of the date hereof).
2.		Last-Out Facility (the “Sun Facility”) under the Credit Agreement (Approximately $70 million outstanding as of September 25, 2009)		The Sun Facility will be repaid or redeemed from the proceeds of new financing (see “Implementation – New Capital” below) on terms acceptable to the Company and the Old Noteholders.
3.		Claims of the Holders (the “ Old Noteholders ”) of the 8.5% Senior Subordinated Notes due 2015 (the “ Old Notes ”) including all related guarantee claims against the Company   ($275 million in principal outstanding, together with accrued interest of $15.3		The Old Noteholders shall receive their pro rata share of shares of common stock issued by restructured or reorganized Accuride (the “ New Common Stock ”), sufficient to result in the Old Noteholders receiving 98.0% of the aggregate issued and outstanding New Common Stock on a fully diluted basis, except as provided below (the “ Noteholder Equity ”). The Noteholder Equity shall be subject to dilution by shares issued upon (a) the exercise of the New Warrants (as defined below), (b) the exercise of any options to purchase New Common Stock provided under a

 

A-3

 

		million as of September 25, 2009)		management incentive plan acceptable to the new Board of Directors (the “ Old Equity Retention ”), and (c) the conversion of (A) the senior convertible notes (the “ New Notes ”) described in the “Implementation – New Capital” section below and (B) the notes representing the paid-in-kind interest on the New Notes (the “ PIK Notes ”).
4.		Other Secured and Unsecured Claims		Unimpaired.
5.		Common Equity in Accuride (the “ Old Equity ”)		The holders of the Old Equity would receive their pro rata share of:   (i) 2.0% of the aggregate issued and outstanding New Common Stock on a fully diluted basis, after giving effect to the transactions contemplated herein and subject to further dilution by shares issued upon (a) the exercise of the New Warrants, (b) the exercise of any options to purchase New Common Stock provided under a management incentive plan, and (c) the conversion of the New Notes and the PIK Notes; and   (ii) “ New Warrants ”, which would enable the holders thereof to purchase up to 15% in the aggregate of the New Common Stock on a fully diluted basis, subject to further dilution by shares issued upon (a) the exercise of any options to purchase New Common Stock provided under a management incentive plan and (b) the conversion of the New Notes and the PIK Notes. The New Warrants would expire 2 years from the date of their issuance. The New Warrants would be exercisable at a strike price that is 110% of a par recovery on the Old Notes on the effective date of a Restructuring. The New Warrants would have other terms and conditions that are customary for securities of this type.   In connection with a pre-arranged Chapter 11 case, all equity interests in Accuride including all options, warrants and other agreements to acquire equity interests of any kind in Accuride (including any arising under or in connection with any employment agreement) will be cancelled. Provided that the Old Equity class votes to accept the plan of reorganization, the holders of Old Equity would receive New Common Stock in a

 

A-4

 

percentage equal to the Old Equity Retention.

 

Implementation

 

1.		Restructuring Transaction		The Company shall restructure its capital structure (the “ Restructuring ”) through a pre-arranged plan of reorganization (the “ Plan ”) for the Company in a case commenced under chapter 11 of the Bankruptcy Code (the “ Chapter 11 Case ”), the material terms and conditions of which will be set forth in this Term Sheet and in the restructuring support agreement to be executed by the Committee and the Company (as amended, supplemented or otherwise modified, the “ Restructuring Agreement ”), together with the New Capital Term Sheet (as defined below), the restructuring support agreement to be executed by the Company and certain prepetition lenders to the Company and the Senior Prepetition Debt Restructuring Term Sheet.
2.		Chapter 11 Case		The conditions to confirmation and to the effective date of the Plan shall each be in form and substance reasonably acceptable to the Committee and the Company. The Plan will provide that no condition may be waived, amended or deleted without the consent of the Committee, not to be unreasonably withheld or delayed. All documents, including without limitation, the Plan, the order approving a disclosure statement with respect to the Plan, the confirmation order, including any findings of fact and conclusions of law with respect thereto, and the corporate governance and related documents for the reorganized Company, shall each be in form and substance reasonably acceptable to the Committee and the Company. In addition, the business plan included in the disclosure statement with respect to the Plan shall be substantially the same business plan as that contained in the presentations titled “Public Lenders Presentation” and “Private Lender Supplement,” each dated July 2009, which were provided by the Company to the Committee, with any change to be reasonably acceptable to the Committee.
4.		Public Markets		The Company shall covenant that all shares of New Common Stock will upon issuance be freely tradable under applicable securities laws, validly issued, fully paid, and non-assessable. The Company will use its best

 

A-5

 

				efforts to list such shares of New Common Stock on the Over the Counter Bulletin Board or another national exchange or quotation service.
5.		New Capital		The terms of the New Notes shall be set forth in a separate term sheet (the “ New Capital Term Sheet ”).
6.		DIP Financing		The Company shall obtain debtor-in-possession financing (“ DIP Financing ”) in amounts and on terms and conditions set forth in the DIP credit agreement (in the form approved by the Committee on the date hereof).
7.		Canadian Operations		The Company shall maintain current business operations in Canada and obtain an appropriate waiver/forbearance under the Credit Agreement with respect to Accuride Canada, which shall be reasonably satisfactory to the Committee.

 

A-6

 

Corporate Matters

 

1.		Restructuring Expenses		The Company will pay (i) the fees and expenses of the Committee’s counsel (including local counsel) and financial advisor in accordance with their respective engagement letters, and (ii) the reasonable out-of-pocket expenses of the Committee members in connection with any travel to meetings with the Company. The obligations of the Company to pay such fees and expenses shall not be subject to the bankruptcy court’s approval of such fees and expenses.
2.		Documentation		The foregoing proposals are subject to the negotiation of definitive documents, in form and substance acceptable to the Company and the Committee and the members thereof.
3.		Board of Directors		The size and composition of the Board of Directors will be mutually agreed upon between the Committee and Accuride.
4.		Corporate Governance		Certificates of incorporations, by-laws and all constituent documents shall be in form and substance acceptable to the Committee and the Company.
5.		Releases, Exculpation Management Incentive Plan		Terms to be proposed by and acceptable to the Committee and the Company.
6.		Registration Rights Agreement		Terms to be proposed by and acceptable to the Committee and the Company.

 

A-7

 

ACCURIDE CORPORATION

TERM SHEET FOR NEW CAPITAL

IN CONNECTION WITH PROPOSED RESTRUCTURING

 

Reference is made to those certain 8.5% Senior Subordinated Notes due 2015 (collectively, the “ Old Notes ” and the holders thereof, the “ Old Noteholders ”) issued by Accuride Corporation, a Delaware corporation (“ Accuride ”, and together with all of its direct and indirect subsidiaries, the “ Company ”).

 

For discussion purposes only, the following outline of the principal terms and conditions of the new capital to be raised in connection with a proposed restructuring (the “ Restructuring ”) is being submitted by the ad hoc committee (the “ Committee ”) of certain entities(2) that hold or manage the Old Notes for consideration by the Company.  This is the New Capital Term Sheet referred to in the “Implementation — New Capital” section in the term sheet for the Restructuring (the “ Master Term Sheet ”) being considered by the Company, the Committee and certain other stakeholders and should be read in conjunction with the Master Term Sheet. This New Capital Term Sheet and all related communications shall be deemed to be settlement negotiations and subject to Federal Rule of Evidence 408. All terms used and not defined herein shall have the meanings ascribed to them in the Master Term Sheet.

 

This New Capital Term Sheet replaces and supersedes all prior agreements and understandings, both written and oral, between the Committee and the Company and their respective advisors with respect to the subject matter hereof.

 

(2) The ad hoc committee consists of Blackrock Financial Management, Inc., Brigade Capital Management, LLC, Canyon Capital Advisors LLC, Principal Global Investors LLC, Sankaty Advisors, LLC and Tinicum Incorporated.

 

A-8

 

Terms of New Capital

 

 

A-9

 

 

A-10

 

 

A-11

 

 

A-12

 

 

A-13