HOLLEY PERFORMANCE PRODUCTS INC
EXHIBIT 10.1
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>5
<FILENAME>a2091292zex-10_1.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
<HTML>
<HEAD>

</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#02ATA1506_4">QuickLinks</A></FONT>
<font size=3> -- Click here to rapidly navigate through this document</font>
<!-- TOC_END -->
<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="km1506_exhibit_10.1"> </A>
<A NAME="toc_km1506_1"> </A>
<BR></FONT><FONT SIZE=2><B>Exhibit 10.1    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>FIRST AMENDMENT<BR>
AND<BR>
WAIVER<BR>
TO<BR>
LOAN AND SECURITY AGREEMENT  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS FIRST AMENDMENT AND WAIVER TO LOAN AND SECURITY AGREEMENT (this "</FONT><FONT SIZE=2><I>First Amendment</I></FONT><FONT SIZE=2>") is made and entered into
as of October&nbsp;11, 2002 by and among Holley Performance Products,&nbsp;Inc., a Delaware corporation ("</FONT><FONT SIZE=2><I>Parent</I></FONT><FONT SIZE=2>"), and each of Parent's
Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent, are referred to hereinafter each individually as a
"</FONT><FONT SIZE=2><I>Borrower</I></FONT><FONT SIZE=2>", and individually and collectively, jointly and severally, as the "</FONT><FONT SIZE=2><I>Borrowers</I></FONT><FONT SIZE=2>"), the Lenders
(as defined in the Loan Agreement referred to below) listed on the signatory pages hereof and Foothill Capital Corporation, a California corporation, in its capacity as arranger and administrative
agent (the "</FONT><FONT SIZE=2><I>Agent</I></FONT><FONT SIZE=2>"). </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>WITNESSETH:  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Borrowers, the Lenders and Agent are parties to that certain Loan and Security Agreement (the "</FONT><FONT SIZE=2><I>Loan
Agreement</I></FONT><FONT SIZE=2>"), dated as of July&nbsp;30, 2002; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
on September&nbsp;11, 2002 and September&nbsp;25, 2002, (1)&nbsp;KHPP Holdings,&nbsp;Inc., a Delaware corporation
("</FONT><FONT SIZE=2><I>KHPP</I></FONT><FONT SIZE=2>"), issued promissory notes in favor of KHPP Acquisition Company II, L.P., a Delaware limited partnership ("</FONT><FONT SIZE=2><I>KHPP
Acquisition</I></FONT><FONT SIZE=2>"), in an aggregate principal amount of $2,000,000 (the "</FONT><FONT SIZE=2><I>Original KHPP Acquisition Notes</I></FONT><FONT SIZE=2>"), and (2)&nbsp;Parent
issued promissory notes in favor of KHPP in an aggregate principal amount of $2,000,000 (the "</FONT><FONT SIZE=2><I>Original KHPP Notes,</I></FONT><FONT SIZE=2>" and, collectively with the Original
KHPP Acquisition Notes, the "</FONT><FONT SIZE=2><I>Original Notes</I></FONT><FONT SIZE=2>"); </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
as a condition to entering into this First Amendment, (1)&nbsp;KHPP Acquisition and KHPP shall have entered into the KHPP Acquisition Investment Documents (as defined in </FONT> <FONT SIZE=2><I>Section&nbsp;2.01(a)</I></FONT><FONT SIZE=2> hereof),
pursuant to which KHPP shall have received (a)&nbsp;an aggregate amount of $7,500,000 in respect
of issuing the Original KHPP Acquisition Notes and the KHPP Acquisition Note (as defined in </FONT><FONT SIZE=2><I>Section&nbsp;2.01(a)</I></FONT><FONT SIZE=2> hereof) to KHPP Acquisition (the
"</FONT><FONT SIZE=2><I>KHPP Acquisition Debt Investment</I></FONT><FONT SIZE=2>") and (b)&nbsp;an infusion of equity capital from KHPP Acquisition in an aggregate amount of $7,500,000
(collectively with the KHPP Acquisition Debt Investment, the "</FONT><FONT SIZE=2><I>KHPP Acquisition Investment</I></FONT><FONT SIZE=2>") and (2)&nbsp;KHPP and Parent shall have entered into the
KHPP Investment Documents (as defined in </FONT><FONT SIZE=2><I>Section&nbsp;2.01(a)</I></FONT><FONT SIZE=2> hereof), pursuant to which Parent shall have received (a)&nbsp;an aggregate amount of
$7,500,000 in respect of issuing the Original KHPP Notes and the KHPP Note (as defined in </FONT><FONT SIZE=2><I>Section&nbsp;2.01(a)</I></FONT><FONT SIZE=2> hereof) to KHPP (the
"</FONT><FONT SIZE=2><I>KHPP Debt Investment</I></FONT><FONT SIZE=2>") and (b)&nbsp;an infusion of equity capital from KHPP in an aggregate amount of $7,500,000 (collectively with the KHPP Debt
Investment, the "</FONT><FONT SIZE=2><I>KHPP Investment</I></FONT><FONT SIZE=2>"); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
as of October&nbsp;9, 2002, Borrowers have the Availability set forth on the certificate attached hereto as </FONT><FONT SIZE=2><I>Exhibit&nbsp;A</I></FONT><FONT SIZE=2>;
and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Borrowers, the Lenders and Agent wish to amend the Loan Agreement as herein provided; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, in consideration of the agreements and provisions herein contained, the parties hereto do hereby agree as follows: </FONT></P>

<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Definitions.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Any capitalized term used but not otherwise
defined
herein shall have the meanings ascribed to such terms in the Loan Agreement. </FONT></P>


<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendments to Loan Agreement.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Loan Agreement is hereby
amended,
effective as of the date this First Amendment becomes effective in accordance with Section&nbsp;4 hereof, as follows: </FONT></P>

<HR NOSHADE>
<!-- ZEQ.=1,SEQ=1,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=671577,FOLIO='blank',FILE='DISK020:[02ATA6.02ATA1506]KM1506A.;3',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<A NAME="page_km1506_1_2"> </A>
<BR>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.01</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendments to Section&nbsp;1.1.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;The
following defined terms are hereby added to </FONT><FONT SIZE=2><I>Section&nbsp;1.1</I></FONT><FONT SIZE=2> of the Loan Agreement: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Investment Documents</I></FONT><FONT SIZE=2>" means, collectively, the KHPP Investment Documents and the KHPP Acquisition Investment Documents. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Acquisition Investment Documents</I></FONT><FONT SIZE=2>" means, collectively, the KHPP Acquisition Note, the KHPP Acquisition Note Documents, the KHPP
Acquisition Preferred Stock Purchase Agreement and all documents, instruments and agreements from time to time delivered in accordance therewith or otherwise relating thereto. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Acquisition Note</I></FONT><FONT SIZE=2>" means the promissory note issued by KHPP in favor of KHPP Acquisition in the original principal amount of
$7,500,000, in form and substance satisfactory to Agent, dated as of October&nbsp;11, 2002. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Acquisition Note Documents</I></FONT><FONT SIZE=2>" means all documents, instruments and agreements from time to time delivered in accordance with or
otherwise relating to the KHPP Acquisition Note. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Acquisition Preferred Stock Purchase Agreement</I></FONT><FONT SIZE=2>" means that certain preferred stock purchase agreement between KHPP Acquisition and
KHPP dated as of October&nbsp;11, 2002, in form and substance satisfactory to Agent. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Investment Documents</I></FONT><FONT SIZE=2>" means, collectively, the KHPP Note, the KHPP Note Documents, the KHPP Preferred Stock Purchase Agreement and
all documents, instruments and agreements from time to time delivered in accordance therewith or otherwise relating thereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Note</I></FONT><FONT SIZE=2>" means the promissory note issued by Parent in favor of KHPP in the original principal amount of $7,500,000, in form and
substance satisfactory to Agent, dated as of October&nbsp;11, 2002. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Note Documents</I></FONT><FONT SIZE=2>" means all documents, instruments and agreements from time to time delivered in accordance with or otherwise relating
to the KHPP Note. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>KHPP Preferred Stock Purchase Agreement</I></FONT><FONT SIZE=2>" means that certain preferred stock purchase agreement between KHPP and Parent dated as of
October&nbsp;11, 2002, in form and substance satisfactory to Agent. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Side Letter</I></FONT><FONT SIZE=2>" means the side letter agreement dated as of October&nbsp;11, 2002, in form and substance satisfactory to Agent, executed
and delivered by Parent, Agent, KHPP Acquisition and KHPP. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;The
definitions of "Base Rate Margin," "Base Rate Subline A Margin," Base Rate Subline B Margin" and Base Rate Subline C Margin" are hereby deleted in their entirety and
the following new defined terms are inserted in replacement thereof: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Base Rate Margin</I></FONT><FONT SIZE=2>" means 1.00; </FONT><FONT SIZE=2><I>provided, however</I></FONT><FONT SIZE=2>, that if Parent's EBITDA for fiscal year
2003 equals or exceeds $26,000,000, then, commencing on and as of the first day of the fiscal quarter of Parent next following the receipt by Agent of Parent's and its Subsidiaries' audited financial
statements for fiscal year 2003 pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, "Base Rate Margin" shall mean 0.75. The determination of EBITDA for purposes of this
definition shall be based upon the fiscal year 2003 audited financial statements delivered to Agent pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>. Notwithstanding
the foregoing, if Parent fails to deliver to Agent the financial statements for fiscal year 2003 required pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, then "Base
Rate Margin" shall mean 1.00. </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=2,SEQ=2,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=255273,FOLIO='2',FILE='DISK020:[02ATA6.02ATA1506]KM1506A.;3',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<A NAME="page_km1506_1_3"> </A>
<UL>
<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Base Rate Subline A Margin</I></FONT><FONT SIZE=2>" means 2.00; </FONT><FONT SIZE=2><I>provided, however</I></FONT><FONT SIZE=2>, that if Parent's EBITDA for
fiscal year 2003 equals or exceeds $26,000,000, then, commencing on and as of the first day of the fiscal quarter of Parent next following the receipt by Agent of Parent's and its Subsidiaries'
audited financial statements for fiscal year 2003 pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, "Base Rate Subline A Margin" shall mean 1.75. The determination of
EBITDA for purposes of this definition shall be based upon the fiscal year 2003 audited financial statements delivered to Agent pursuant to </FONT> <FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>. Notwithstanding the foregoing, if Parent
fails to deliver to Agent the financial statements for fiscal year 2003 required
pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, then "Base Rate Subline A Margin" shall mean 2.00. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Base Rate Subline B Margin</I></FONT><FONT SIZE=2>" means 8.75; </FONT><FONT SIZE=2><I>provided, however</I></FONT><FONT SIZE=2>, that if Parent's EBITDA for
fiscal year 2003 equals or exceeds $26,000,000, then, commencing on and as of the first day of the fiscal quarter of Parent next following the receipt by Agent of Parent's and its Subsidiaries'
audited financial statements for fiscal year 2003 pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, "Base Rate Subline B Margin" shall mean 8.50. The determination of
EBITDA for purposes of this definition shall be based upon the fiscal year 2003 audited financial statements delivered to Agent pursuant to </FONT> <FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>. Notwithstanding the foregoing, if Parent
fails to deliver to Agent the financial statements for fiscal year 2003 required
pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, then "Base Rate Subline B Margin" shall mean 8.75. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Base Rate Subline C Margin</I></FONT><FONT SIZE=2>" means 2.00; </FONT><FONT SIZE=2><I>provided, however</I></FONT><FONT SIZE=2>, that if Parent's EBITDA for
fiscal year 2003 equals or exceeds $26,000,000, then, commencing on and as of the first day of the fiscal quarter of Parent next following the receipt by Agent of Parent's and its Subsidiaries'
audited financial statements for fiscal year 2003 pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, "Base Rate Subline C Margin" shall mean 1.75. The determination of
EBITDA for purposes of this definition shall be based upon the fiscal year 2003 audited financial statements delivered to Agent pursuant to </FONT> <FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>. Notwithstanding the foregoing, if Parent
fails to deliver to Agent the financial statements for fiscal year 2003 required
pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6.3(b)</I></FONT><FONT SIZE=2>, then "Base Rate Subline C Margin" shall mean 2.00. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;The
definition of "Loan Documents" in </FONT><FONT SIZE=2><I>Section&nbsp;1.1</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by inserting the words
", the Side Letter," directly after the words "the Intercompany Subordination Agreement" and before the words "the Letters of Credit" in the fourth line thereof. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.02</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment of
Section&nbsp;3.2.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;3.2</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by deleting </FONT> <FONT SIZE=2><I>Section&nbsp;3.2(d)</I></FONT><FONT
SIZE=2> in it entirety. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.03</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to Section&nbsp;6.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;6  </I></FONT><FONT SIZE=2> of the Loan Agreement is hereby
amended by inserting the following as new </FONT><FONT SIZE=2><I>Section&nbsp;6.18</I></FONT><FONT SIZE=2>: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><B><I>Section&nbsp;6.18</I></B></FONT><FONT SIZE=2>. Parent promptly will provide the Lenders with true and complete copies of any and all documents and other
information delivered to any Person pursuant to, or in connection with, the Investment Documents." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.04</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to
Section&nbsp;7.1.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;7.1</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by inserting the following as new </FONT> <FONT SIZE=2><I>Section&nbsp;7.1(g)
</I></FONT><FONT SIZE=2>: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"(g)
Indebtedness owed to KHPP pursuant to the KHPP Note Documents, so long as such Indebtedness is (i)&nbsp;not secured by any of the assets or properties of any Borrower or the
Guarantor and (ii)&nbsp;subject to the terms and provisions of the Side Letter." </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=3,SEQ=3,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=945284,FOLIO='3',FILE='DISK020:[02ATA6.02ATA1506]KM1506A.;3',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<A NAME="page_km1506_1_4"> </A>
<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.05</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to
Section&nbsp;7.8.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;7.8(a)</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by deleting </FONT> <FONT SIZE=2><I>Section&nbsp;7.8(a)</I></FONT><FONT
SIZE=2> in its entirety and inserting the following new </FONT><FONT SIZE=2><I>Section&nbsp;7.8(a)</I></FONT><FONT SIZE=2> in
replacement thereof: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Except
(i)&nbsp;as specifically permitted by the Side Letter or (ii)&nbsp;in connection with a refinancing permitted by </FONT> <FONT SIZE=2><I>Section&nbsp;7.1(d)</I></FONT><FONT SIZE=2>, prepay, redeem, defease, purchase, or otherwise acquire any
Indebtedness of any Borrower prior to its scheduled maturity, other
than the Obligations in accordance with this Agreement, and" </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.06</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to
Section&nbsp;7.14.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;7.14</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by inserting the words "the KHPP
Investment Documents or" directly after the words "permitted by" and before the words "</FONT><FONT SIZE=2><I>Section&nbsp;7.11</I></FONT><FONT SIZE=2>" in the first line thereof </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.07</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to Section of Loan Agreement with the heading "Securities Accounts."</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The
Section of the Loan Agreement with the heading "Securities Account" is hereby numbered as </FONT><FONT SIZE=2><I>Section&nbsp;7.19</I></FONT><FONT SIZE=2> of the Loan Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.08</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendments to Section&nbsp;7.19.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;7.19</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby renumbered as </FONT> <FONT SIZE=2><I>Section&nbsp;7.20</I></FONT><FONT SIZE=2> of the Loan Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;7.19(a)(i)</I></FONT><FONT SIZE=2>&nbsp;of the Loan Agreement is hereby amended by deleting </FONT> <FONT SIZE=2><I>Section&nbsp;7.19(a)(i)</I></FONT><FONT SIZE=2>&nbsp;in its entirety and inserting the following new </FONT>
<FONT SIZE=2><I>Section&nbsp;7.20(a)(i)</I></FONT><FONT SIZE=2>&nbsp;in replacement thereof: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2><B>Fixed Charge Coverage Ratio</B></FONT><FONT SIZE=2>. A Fixed Charge Coverage Ratio, measured on a fiscal quarter-end
basis, of not less than the applicable Fixed Charge Coverage Ratio set forth in the following table for the applicable period set forth opposite thereto: </FONT></DD></DL>
</UL>
</UL>
<BR>

<!-- User-specified TAGGED TABLE -->
<DIV ALIGN="CENTER"><TABLE WIDTH="56%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="24%" ALIGN="CENTER"><FONT SIZE=1><B>Applicable Fixed<BR>
Charge&nbsp;Coverage&nbsp;Ratio<BR> </B></FONT><HR NOSHADE></TH>
<TH WIDTH="4%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="72%" ALIGN="CENTER"><FONT SIZE=1><B>Applicable Period<BR> </B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="24%" ALIGN="CENTER"><FONT SIZE=2>0.31:1</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="72%"><FONT SIZE=2>For the 12 month period ending June 30, 2003</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="24%" ALIGN="CENTER"><FONT SIZE=2>0.66:1</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="72%"><FONT SIZE=2>For the 12 month period ending September 30, 2003</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="24%" ALIGN="CENTER"><FONT SIZE=2>0.9:1</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="72%"><FONT SIZE=2>For the 12 month period ending December 31, 2003</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="24%" ALIGN="CENTER"><FONT SIZE=2>1:1</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="72%"><FONT SIZE=2>For the 12 month period ending each fiscal quarter thereafter</FONT></TD>
</TR>
</TABLE></DIV>
<!-- end of user-specified TAGGED TABLE -->

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.09</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendments to
Section&nbsp;7.20.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;7.20</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby renumbered as </FONT> <FONT SIZE=2><I>Section&nbsp;7.21</I></FONT><FONT SIZE=2> of
the Loan Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.10</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to Section&nbsp;7 of the Loan
Agreement.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;7</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by inserting the following as new </FONT> <FONT SIZE=2><I>Sections
7.22</I></FONT><FONT SIZE=2> and </FONT><FONT SIZE=2><I>7.23</I></FONT><FONT SIZE=2>: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><B><I>Section&nbsp;7.22.&nbsp;&nbsp;&nbsp;&nbsp;KHPP Investment Documents</I></B></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;Directly or indirectly amend, modify, alter or change any term
or condition of any KHPP Investment Document." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><B><I>Section&nbsp;7.23.&nbsp;&nbsp;&nbsp;&nbsp;Phase-II Environmental Report</I></B></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;After January&nbsp;1, 2004, Parent shall
deliver a phase-II environmental report with respect to each parcel comprising the Real Property Collateral, within ninety (90)&nbsp;days after Agent's request, the scope of the report
and the results thereof shall be acceptable to Agent." </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>2.11</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Amendment to Section&nbsp;8 of the Loan
Agreement.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Section&nbsp;8</I></FONT><FONT SIZE=2> of the Loan Agreement is hereby amended by inserting the following as new </FONT> <FONT
SIZE=2><I>Section&nbsp;8.14</I></FONT><FONT SIZE=2>: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><B><I>Section&nbsp;8.14</I></B></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If a default occurs under any Investment Document." </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Representations and Warranties.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;In order to induce Agent and
the
Lenders to enter into this First Amendment, each of the Borrowers hereby represents and warrants that: </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=4,SEQ=4,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=7513,FOLIO='4',FILE='DISK020:[02ATA6.02ATA1506]KM1506A.;3',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->

<P><FONT SIZE=2><A
NAME="page_ko1506_1_5"> </A> </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>3.01</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;No Default.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;At and as of the date of this First Amendment and at and as of the
Effective Date and both prior to and after giving effect to this First Amendment, no Default or Event of Default exists. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>3.02</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Representations and Warranties True and Correct.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;At and as of the date of this
First Amendment and at and as of the Effective Date and both prior to and after giving effect to this First Amendment, each of the representations and warranties contained in the Loan Agreement and
the other Loan Documents is true and correct in all material respects. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>3.03</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Corporate Power, Etc.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Such Borrower (i)&nbsp;has all requisite corporate power
and authority to execute and deliver this First Amendment and the Side Letter and to consummate the transactions contemplated hereby and thereby and (ii)&nbsp;has taken all action, corporate or
otherwise, necessary to authorize the execution and delivery of this First Amendment and the Side Letter and the consummation of the transactions contemplated hereby and thereby. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>3.04</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;No Conflict.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Neither the execution and delivery of this First Amendment and the
Side Letter, nor consummation of the transactions contemplated hereby or thereby will (i)&nbsp;conflict with or result in any breach or violation of any provision of the certificate of incorporation
or by-laws of such Borrower, (ii)&nbsp;result in any breach or violation of, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default)
under, or result in the termination of, or accelerate the performance required by, or result in the creation of a Lien upon any of the properties or assets of such Borrower under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease agreement or other instrument or obligation to which such Borrower is a party or to which any of its
properties or assets are subject, (iii)&nbsp;require any consent, approval, authorization or permit of, or filing with or notification to, any third party or any Governmental Authority, or
(iv)&nbsp;violate any order, writ, injunction, decree, judgment, ruling, law, statute, rule or regulation of any Governmental Authority. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>3.05</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Binding Effect.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This First Amendment and the Side Letter have been duly executed
and delivered by such Borrower and constitute the legal, valid and binding obligations of such Borrower, enforceable against such Borrower in accordance with their respective terms, except as such
enforceability may be limited by (i)&nbsp;applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws, now or hereafter in effect, relating to or affecting the enforcement of
creditors' rights generally, and (ii)&nbsp;the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>3.06</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Investment Documents.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Parent has delivered to the Lenders true and complete copies
of the Investment Documents. All of the representations and warranties of KHPP, KHPP Acquisition, Parent and any Borrower in the Investment Documents are true and correct in all respects. </FONT></P>

</UL>

<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Conditions.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This First Amendment and the effectiveness of the
amendments set forth in </FONT><FONT SIZE=2><I>Section&nbsp;2</I></FONT><FONT SIZE=2> hereof shall be effective as of October&nbsp;11, 2002 (the "</FONT><FONT SIZE=2><I>Effective
Date</I></FONT><FONT SIZE=2>") upon the fulfillment by the Borrowers, in a manner satisfactory to Agent and the Lenders, of all of the following conditions precedent set forth in this </FONT> <FONT SIZE=2><I>Section&nbsp;4</I></FONT><FONT SIZE=2>:
</FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.01</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Execution and Delivery of the First Amendment.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Each of the parties hereto shall
have executed an original counterpart of this First Amendment and shall have delivered (including by way of facsimile transmission) the same to Agent. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.02</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Execution and Delivery of the Side Letter.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Agent, KHPP Acquisition, KHPP and Parent
shall have executed an original counterpart of the Side Letter and shall have delivered (including by way of facsimile transmission) the same to Agent. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=1,SEQ=5,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=109775,FOLIO='5',FILE='DISK020:[02ATA6.02ATA1506]KO1506A.;4',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<A NAME="page_ko1506_1_6"> </A>
<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.03</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;KHPP Acquisition Investment.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The KHPP Acquisition Investment shall have occurred on
terms and conditions satisfactory to Agent, and Agent shall have been furnished with evidence, satisfactory to Agent and its counsel, of the KHPP Acquisition Investment having occurred. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.04</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;KHPP Investment.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The KHPP Investment shall have occurred on terms and conditions
satisfactory to Agent, and Agent shall have been furnished with evidence, satisfactory to Agent and its counsel, of the KHPP Investment having occurred. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.05</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Investment Documents.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Investment Documents shall have been executed by all of
the parties thereto, and Parent shall have delivered to Agent true and complete copies of the Investment Documents. Agent and its counsel shall have reviewed, and be satisfied in all respects with,
the Investment Documents. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.06</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Cancellation of Original Notes</I></B></FONT><FONT SIZE=2>. The Original Notes shall have been cancelled and Agent shall
have received satisfactory evidence that the Original Notes shall have been cancelled and are of no further effect. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.07</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Delivery of Other Documents.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Agent shall have received all of the following, each
duly executed and dated the date hereof, in form and substance reasonably satisfactory to Agent: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Resolutions of the Borrowers.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Copies, duly certified by the secretary or assistant secretary of each
Borrower of (i)&nbsp;resolutions of the Board of Directors of such Borrower authorizing or ratifying the execution and delivery of this First Amendment, the Side Letter and the performance of the
transactions contemplated herein and therein, (ii)&nbsp;all documents evidencing other necessary corporate action, and (iii)&nbsp;all approvals or consents, if any, with respect to this First
Amendment. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Incumbency Certificates.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Certificates of the secretary or assistant secretary of each Borrower certifying
the names of the officers of such Borrower authorized to sign this First Amendment, the Side Letter and all other documents or certificates to be delivered hereunder or in connection herewith,
together with the true signatures of such officers. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Other.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;All other such instruments, documents and agreements as Agent may reasonably request. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.08</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Closing Fee.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Borrower shall have paid to Agent, for the benefit of the Lenders
(apportioned in accordance with each Lender's Pro Rata Share), a closing fee in the amount of $200,000. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>4.09</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Compliance with Terms.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Each Borrower shall have complied in all respects with the
terms of this First Amendment, the Side Letter and of any other agreement, document, instrument or other writing to be delivered by the Borrower in connection herewith and therewith. </FONT></P>

</UL>

<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Waiver.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Subject to the satisfaction of the conditions precedent
set
forth in Section&nbsp;4 hereof, the Agent and the Lenders hereby waives compliance with the provisions of the Loan Documents that prohibit Borrowers from entering into the Original Notes. </FONT></P>

<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;General Confirmations and Amendments.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>6.01</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Continuing Effect.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except as specifically provided herein, the Loan Agreement and
the other Loan Documents shall remain in full force and effect in accordance with their respective terms and are hereby ratified and confirmed in all respects. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>6.02</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;No Waiver.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This First Amendment is limited as specified and the execution, delivery
and effectiveness of this First Amendment shall not operate as a modification, acceptance or waiver of any provision of the Loan Agreement or any other Loan Document. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=2,SEQ=6,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=766298,FOLIO='6',FILE='DISK020:[02ATA6.02ATA1506]KO1506A.;4',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<A NAME="page_ko1506_1_7"> </A>
<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>6.03</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;References.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;From
and after the Effective Date, (i)&nbsp;the Loan Agreement, the other Loan Documents and all agreements, instruments and documents executed and delivered in
connection with any of the foregoing shall each be deemed amended hereby to the extent necessary, if any, to give effect to the provisions of this First Amendment and (ii)&nbsp;all of the terms and
provisions of this First Amendment are hereby incorporated by reference into the Loan Agreement, as if such terms and provisions were set forth in full therein. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;From
and after the Effective Date, (i)&nbsp;all references in the Loan Agreement to "this Agreement", "hereto", "hereof", "hereunder" or words of like import referring
to the Loan Agreement shall mean the Loan Agreement as amended hereby and (ii)&nbsp;all references in the Loan Agreement, the other Loan Documents or any other agreement, instrument or document
executed and delivered in connection therewith to "Loan Agreement", "thereto", "thereof", "thereunder" or words of like import referring to the Loan Agreement shall mean the Loan Agreement as amended
hereby. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;7.</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Miscellaneous.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>7.01</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Governing Law.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;THIS FIRST AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>7.02</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Severability.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The provisions of this First Amendment are severable, and if any
clause or provision shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part
thereof, in such jurisdiction and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision in this First Amendment in any jurisdiction. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>7.03</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Counterparts.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This First Amendment may be executed in any number of counterparts,
each of which counterparts when executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>7.04</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Headings.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Section headings in this First Amendment are included herein for
convenience of reference only and shall not constitute a part of this First Amendment for any other purpose. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>7.05</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Binding Effect; Assignment.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This First Amendment shall be binding upon and inure to
the benefit of the Borrowers, Agent and the Lenders and their respective successors and assigns; </FONT><FONT SIZE=2><I>provided, however</I></FONT><FONT SIZE=2>, that the rights and obligations of
the Borrowers under this First Amendment shall not be assigned or delegated without the prior written consent of Agent and the Lenders. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>7.06</B></FONT><FONT SIZE=2><B><I>&nbsp;&nbsp;&nbsp;&nbsp;Expenses.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Borrowers agree to pay Agent upon demand for all reasonable expenses,
including reasonable fees of attorneys and legal assistants for Agent, Highbridge and HCM/Z Special Opportunites, LLC (who may be employees of Agent, Highbridge or HCM Special Opportunities, LLC, as
applicable), incurred by Agent and Highbridge in connection with the preparation, negotiation and execution of this First Amendment, the Side Letter and any document required to be furnished herewith
or therewith. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Signature
pages follow] </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=3,SEQ=7,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4",CHK=978662,FOLIO='7',FILE='DISK020:[02ATA6.02ATA1506]KO1506A.;4',USER='SSTANSE',CD='15-OCT-2002;10:35' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<BR>
<P><br><A NAME="02ATA1506_4">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_km1506_1">Exhibit 10.1</A></FONT><BR>
</UL>
<!-- SEQ=,FILE='QUICKLINK',USER=SSTANSE,SEQ=,EFW="2091292",CP="HOLLEY PERFORMANCE INC.",DN="4" -->
<!-- TOCEXISTFLAG -->
</BODY>
</HTML>

</TEXT>
</DOCUMENT>
