10.6-1 EXECUTION COPY
THIRD AMENDMENT TO LOAN AGREEMENT
THIS THIRD AMENDMENT TO LOAN AGREEMENT, dated as of June 5, 1996
(this "Amendment"), is among CHECKER MOTORS CORPORATION, A Delaware
corporation (the "Company"), YELLOW CAB COMPANY, a Delaware corporation
("Yellow Cab"), CHICAGO AUTOWERKS INC., a Delaware corporation ("AutoWerks"),
CMC KALAMAZOO INC., a Delaware corporation ("CMC") and SOUTH CHARLESTON
STAMPING & MANUFACTURING COMPANY, a West Virginia corporation ("SCSM") (the
Company, Yellow Cab, AutoWerks, CMC and SCSM may each be referred to as a
"Borrower" and collectively as the "Borrowers"), the Lenders set forth on the
signature pages hereof (collectively, the "Lenders" and individually, a
"Lender") and NBD Bank, a Michigan banking corporation, as agent for the
Lenders (in such capacity, the "Agent").
RECITAL
The Borrowers, the Lenders and the Agent are parties to a Loan Agreement
dated as of January 26, 1995, as amended by a First Amendment to Loan
Agreement dated as of September 22, 1995 and a Second Amendment to Loan
Agreement dated as of December 8, 1995 (the "Loan Agreement") and desire to
amend the Loan Agreement as set forth herein.
TERMS
In consideration of the premises and of the mutual agreements herein
contained, the parties agree as follows:
ARTICLE I. AMENDMENT. The Loan Agreement shall be amended as follows:
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1.1 Section 3.1 is amended by adding the following new clause to the
end thereof:
(e) Upon any sale or other transfer of ACIC, the Company
shall prepay the Advances, simultaneously with the
receipt of any proceeds from such sale or other transfer
of ACIC, by an amount equal to 25% (or 100% if any
Default or Event of Default has occurred and is
continuing) of the proceeds from any sale or other
transfer of ACIC, net of any reasonable costs and
expenses directly incurred in connection with such sale
or transfer and any taxes directly incurred in connection
with such sale or transfer. If all of the proceeds of
any such sale or other transfer are not in cash, the
Company shall prepay Advances to the maximum extent of
the cash portion of such net proceeds with the remainder
of any required prepayment under the Section 3.1(e) to be
paid by the pledging of any non-cash proceeds with the
shortest maturity, with the eventual cash proceeds
thereof being applied to the Advances as required under
this Section 3.1(e), provided that at least 25% of the
proceeds of such sale are in cash. The prepayment under
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this Section 3.1(e) shall be applied first to the Term Loan
until paid in full, and next to the Revolving Credit Advances
until paid in full (and any such application, if any, to the
Revolving Credit Advances shall mandatorily reduce the
Commitments by a like amount).
1.2 Section 5.2(i) is amended by adding the following to the end
thereof:
and other than any sale of ACIC, provided that ACIC shall
not be sold for less than its statutory book value and
such sale shall be subject to the prepayment requirements
described in Section 3.1(e) hereof (and notwithstanding
anything herein to the contrary, each Lender agrees that
the Agent may release any lien or security interest with
respect to the capital stock of ACIC or any assets of
ACIC in connection with any such sale).
ARTICLE II. REPRESENTATIONS. Each Borrower represents and warrants that:
2.1 The execution, delivery and performance of this Amendment is within
its powers, has been duly authorized and is not in contravention with any
law, of the terms of its articles of incorporation or by-laws, or any
undertaking to which it is a party or by which it is bound.
2.2 This Amendment is the legal, valid and binding obligation of it,
enforceable against it in accordance with the terms hereof.
2.3 After giving effect to the amendments herein contained, the
representations and warranties contained in Article IV of the Loan Agreement
and in the other Loan Documents are true on and as of the date hereof with
the same force and effect as if made on and as of the date hereof.
2.4 No Event of Default or Default exists or has occurred and is
continuing on the date hereof.
ARTICLE III. MISCELLANEOUS.
3.1 References in any Loan Document to the Loan Agreement shall be
deemed to be references to the Loan Agreement as amended hereby and as
further amended from time to time.
3.2 Except as expressly amended hereby, the Borrowers agree that all
Loan Documents are ratified and confirmed and shall remain in full force and
effect and that the Borrowers have no set off, counterclaim or defense with
respect to any of the foregoing. Terms used but not defined herein shall
have the respective meanings ascribed thereto in the Loan Agreement.
3.3 This Amendment may be signed upon any number of counterparts with
the same effect as if the signatures thereto and hereto were upon the same
instrument.
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3.4 This Amendment shall not be effective until the Company shall have
paid to the Agent, for the pro rata benefit of the Lenders, an amendment fee
in the amount of $25,000.
IN WITNESS WHEREOF, the parties signing this Amendment have caused this
Amendment to be executed and delivered as of the day and year set forth
above.
CHECKER MOTORS CORPORATION
By: /s/ Jay Harris
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Its: Vice President
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YELLOW CAB COMPANY
By: /s/ Jay Harris
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Its: Vice President
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CHICAGO AUTOWERKS INC.
By: /s/ Jay Harris
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Its: Vice President
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CMC KALAMAZOO INC.
By: /s/ Jay Harris
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Its: Vice President
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SOUTH CHARLESTON STAMPING &
MANUFACTURING COMPANY
By: /s/ Larry D. Temple
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Its: Vice President
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NBD BANK, as a Lender and as Agent
By: /s/ Randy R. Balluff
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Its: Senior Vice President
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THE BANK OF NEW YORK COMMERCIAL
CORPORATION
By: /s/ Dan Murry
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Its: Vice President
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THE FIRST NATIONAL BANK OF BOSTON
By: /s/ Larry Favre
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Its: Director
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