SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) April 28, 1995
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AMALGAMATED AUTOMOTIVE INDUSTRIES, INC.
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PENNSYLVANIA 1-6886 & 2-37589 23-1716951
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(State or other jurisdictional (Commission File (IRS Employer
of incorporation or organization) Number) Identification Number)
POST OFFICE BOX 2441
1731 SOUTH 19TH STREET, HARRISBURG, PENNSYLVANIA 17104
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 717/939-7893
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NO CHANGE
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(Former name or former address, if changed since last report)
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Item 5. Other Events
The Registrant maintains a line of credit with Provident Bank of Maryland
("Provident") which allows it to borrow up to $2,000,000. As of April 28,
1995, the Registrant had utilized the credit to the extent of $1,877,000.
The line of credit is collateralized by accounts receivable, inventory,
equipment, and working fund accounts maintained at the bank. The agreement
provides, among other things, for maintenance of working capital above
$750,000 and tangible net worth above $500,000, the meeting of certain
performance ratios and cash flows (as defined in the agreement).
In the Management's Discussion and Analysis Section of its Annual Report
on Form 10-KSB, the Registrant reported that although it was in default of
certain ratio and cash flow requirements under its line of credit agreement
with Provident, the bank had agreed to waive its rights and remedies allowed
per the loan agreement as of October 31, 1994, but as a condition for the
waiver, the loan interest rate under the loan agreement had been increased
from 2% to 4% per annum above the bank's prime rate effective January 9, 1995.
By letter received April 28, 1995, Provident has advised that it continues
to review with concern the Registrant's performance, that there continues to be
uncured covenant violations, and that it is the bank's intent for the
Registrant to repay or replace Provident's credit facilities to the
Registrant by no later than June 1, 1995.
During the fourth quarter of Calendar 1994, the Registrant engaged a firm
to provide consulting services to include such matters as the structuring of
financing alternatives, preparation of financial and marketing presentations
and making inquiries within the industry regarding interest in the possible
acquisition of the Company's stock or assets. Management with the assistance
of the consulting firm is in the process of seeking alternative financing
arrangements to replace Provident's credit facilities at the earliest
opportunity, but is uncertain whether this can be accomplished by June 1,
1995.
In addition, the Registrant has received some expressions of interest in
the possible purchase of the Registrant's shares or a substantial portion of
its assets and has commenced discussions of a preliminary nature with firms
expressing an interest. Shareholders have been advised that management will
consider legitimate proposals and, if they merit it, make a recommendation
regarding same to shareholders. It is not possible at this time to determine
whether anything more may develop in connection with the expressions of
possible interest.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMALGAMATED AUTOMOTIVE INDUSTRIES, INC.
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(Registrant)
Date May 8, 1995 /s/ Kurt J. Myers
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Kurt J. Myers
President and Chief Executive Officer
