Oxford Automotive and Lender Group Agree to Term Sheet For $100 Million Senior Lending Facility

Facility would position company to move business plan forward

TROY, Mich., Sept. 15 -- Oxford Automotive, Inc., a Tier 1 supplier of stampings and welded assemblies, announced that it has agreed to a non-binding term sheet with certain members of an ad hoc committee of holders of its 12% Senior Notes due 2010 (the "Lending Group") to refinance its existing senior credit facility and to provide additional operating funds. The members of the Lending Group hold in the aggregate in excess of 51% of the Senior Notes.

The term sheet provides that, subject to certain conditions, including the execution of definitive documents, certain members of the Lending Group will provide Oxford with a term loan facility in the form of initial and deferred term loans of up to $100 million in the aggregate, which would be an amount sufficient to refinance Oxford's existing senior credit facility and, after fees and expenses, provide up to an additional $50 million to fund operations. Funding of advances under the facility would be subject to Oxford's continuing compliance with an agreed upon financial budget. Pursuant to the term sheet, an offer to participate in the facility on a pro-rata basis will be made to all noteholders.

This new capital would help alleviate Oxford's short-term liquidity issues. These issues were created, in part, by the pre-launch expenses at Oxford's new McCalla, Alabama plant that will supply the complete underbody assemblies for the Mercedes M-Class, launching in December of this year, and the Grand Sports Tourer, due to launch in mid-2005. "While we continue to be on time and on plan for both launches, the additional capital will assist us in our launch process," said David Treadwell, who was named CEO of Oxford last month. Pursuant to the term sheet, and to permit the financing, Oxford will be seeking certain amendments to the Indenture governing the Senior Notes. In addition, Oxford will be seeking temporary waivers of certain existing defaults under other Indenture provisions. Pursuant to the term sheet, the Lending Group would agree to consent to such amendments and temporary waivers.

"We are pleased with this new facility as, once completed, it will provide additional liquidity to help maintain our relationships with our customers, employees and suppliers," said Treadwell. "Further, it would position us with additional short-term capital to support our strategic activities." As previously announced, Oxford continues to pursue strategic options to further optimize its value and to further increase liquidity, including the possible sale of some or all of its assets in North America and Europe. Oxford intends to continue working with the ad hoc noteholders' committee on the terms of such strategic plans.

Oxford said that it is hopeful that it will be able to close the financing prior to the end of the month; however, the agreement in principle with respect to the financing is subject to a number of conditions and definitive documentation, and no predictions can be made by Oxford management as to whether the refinancing of its senior credit facility can be accomplished on the terms described above or at all and, if so, whether Oxford will be able to make progress with its strategic initiatives following such a refinancing.

Oxford also announced that it does not expect to pay the scheduled October 15, 2004 interest payment on its Senior Notes. Oxford intends to continue negotiations with the Lending Group and the noteholders' committee regarding this issue.

About Oxford

Oxford, with headquarters in Troy, Mich., is a leading Tier 1 supplier of specialized metal-formed systems, modules, assemblies, components and related services for the automotive industry. Oxford's primary products include structural modules and systems, exposed closure panels, suspension systems and vehicle opening systems, many of which are critical to the structural integrity and design of the vehicle. For more information, http://www.oxauto.com/ .

Forward-Looking Statements

This press release includes statements that constitute forward-looking statements, as that term is defined by the federal securities laws. These statements often include words such as "believe," "expect," "preliminary," estimate," "intend," "anticipate, "plan," "project" or other similar expressions. All forward-looking statements involve risk and uncertainties and there can be no assurances that actual results will not materially differ from expected results. You should not place undue reliance on these statements as they only speak as of the date of this press release. Risks and uncertainties that could cause actual results to vary materially from those anticipated in the forward-looking statements included in this press release include general economic conditions in the markets in which we operate, industry-based factors, and factors more specific to us such as: (1) our ability to obtain adequate or advantageous financing or refinancing of existing debt; (2) the successful completion of our various strategic initiatives; (3) the final results of our ongoing accounting review; (4) the impact of any accounting restatements on our financial results and our ability to complete our financial statements in a timely manner; (5) our ability to comply with the covenants under our credit facility or the successful negotiation of any required covenant waivers and adjustments; (6) the significant amount of our indebtedness and our ability to generate sufficient cash flow from operations to meet our liquidity needs; (7) uncertainty relating to our new program awards and our ability to successfully launch these new programs, especially the Mercedes M-Class and Grand Sports Tourer programs; (8) our dependence on significant automotive customers; (9) our dependence on automotive industry conditions; (10) losses and costs associated with the liquidation through bankruptcy of our Canadian subsidiary; (11) the cyclical nature of the automotive industry; (12) instability in the global economy; (13) the risks associated with conducting business through our foreign subsidiaries, such as our ability to receive distributions from these foreign subsidiaries and foreign currency exchange fluctuations; (14) exposure to increased cost of purchased raw materials and components, such as steel; (15) our inability to reduce costs; labor costs and strikes at our major direct and indirect customers and at our facilities; (16) increased internal production by our automotive customers; (17) the level of competition in the automotive supply industry; (18) our inability to develop or implement new technologies; (19) our inability to meet future capital requirements and the impact of any accounting review and the related issues on efforts to fund these requirements; (20) our exposure to environmental liabilities; (21) our inability to sell receivables; (22) our dependence on key personnel; (23) unexpected interruptions at any of our manufacturing facilities due to equipment failures or delays in deliveries from vendors; and (24) our exposure to product liability and warranty claims.