Custom Chrome, Inc. and Subsidiaries - Page 8

                                        - 8 -                                         

          share paid by investors who acquired stock in CC Holdings as part           
          of the LBO of petitioner.                                                   
               Terms of the agreement under which FNBB received options to            
          acquire stock in CC Holdings for $500 per share were hotly                  
          negotiated between JC Investors, CC Holdings, and FNBB.                     
          Financing the LBO posed significant risks for FNBB.                         
          Approximately $9 million of the $26 million loan made available             
          by FNBB was not secured.  The LBO would change petitioner's                 
          capital structure from primarily equity to primarily debt.  In              
          recognition of such risks, the options provided FNBB the                    
          potential to earn significant additional income if the stock of             
          CC Holdings increased in value.  FNBB loan officers estimated               
          that the options might have a value in 5 years of approximately             
          $5 million.                                                                 
               Immediately following the LBO transaction and under the                
          various supplemental agreements, the common stock (or in the case           
          of FNBB options to acquire common stock of CC Holdings) was owned           
          as follows:                                                                 
                                                  Percentage Ownership                
               Stockholders                 In CC Holdings                            
               JC Investors                            28.500                         
               Mezzanine Capital                       28.500                         
               Cruze, Panzica,                                                        
               Battistella, and Navarra                24.625                         
               FNBB (options)                          12.500                         
               Other Employees of Petitioner           5.375                          
               Miscellaneous                            .500                          
                                   Total               100.000                        

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