Custom Chrome, Inc. and Subsidiaries - Page 6

                                        - 6 -                                         

          CC Acquisition was made available to CC Acquisition under 3 lines           
          of credit with various interest rates and terms, as follows:                

          Lines of Credit     Amount         Interest Rate      Term                  
          Tranche I           $9,000,000     Prime Plus 2.0%    5 Years               
          Tranche II          9,000,000      Prime Plus 1.5%    7 Years               
          Working Capital     8,000,000      Prime Plus 1.5%    5 Years               

               By selling debentures issued by CC Holdings to Mezzanine               
          Capital and Income Trust (Mezzanine Capital), CC Holdings                   
          obtained an additional $7 million to assist in financing the LBO.           
          Prior to the LBO, CC Holdings contributed to CC Acquisition the             
          $7 million received from sale of the debentures along with an               
          additional $500,000 that CC Holdings had raised through sale of             
          its stock.                                                                  
               The following schedule summarizes the source and amount of             
          funds obtained by JC Investors through its two controlled                   
          corporations, CC Acquisition and CC Holdings, in connection with            
          the LBO:                                                                    

               Source of Funds                    Amount                              
               FNBB Line of Credit                     $26,000,000                    
               Sale of Debentures to Mezzanine Capital       7,000,000                
               CC Holdings Contribution                    500,000                    
                                             Total     $33,500,000                    

               On August 25, 1989, pursuant to the plan of acquisition and            
          using the funds that had been obtained by CC Acquisition, CC                
          Holdings acquired Cruze’s stock in petitioner in an LBO that, for           
          Federal income tax purposes, took the form of a taxable reverse             

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011