Exhibit
4(c)(1)
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 **FIRST
AMENDMENT TO LOAN AGREEMENT**
 
 This is a **FIRST
AMENDMENT TO LOAN AGREEMENT** entered
into as of this 13th day of April 2005 among **RAYTECH
POWERTRAIN, INC.** , a
Delaware corporation whose address is 4 Corporate Drive, Shelton,
Connecticut 06484 ("Raytech Powertain"), **ALLOMATIC
PRODUCTS COMPANY** , a
Delaware corporation whose address is 609 E. Chaney Street, Sullivan,
Indiana 47882 ("Allomatic"), **RAYTECH
SYSTEMS, INC.,** a
Delaware corporation, whose address is 312 S. St. Clair Street, Sullivan,
Indiana 47882 ("Raytech Systems"; and together with Raytech Powertrain and
Allomatic, the "Original Borrowers") and **RAYBESTOS
POWERTRAIN, LLC** , an
Indiana limited liability company whose address is 964 East Market Street,
Crawfordsville, Indiana 47933 (the "Additional Borrower" and together with the
Original Borrower, collectively the "Borrowers"); **RAYTECH
CORPORATION** , a
Delaware corporation whose address is Four Corporate Drive, Suite 295,
Shelton, Connecticut 06484 (the "Guarantor") and **WACHOVIA
BANK, NATIONAL ASSOCIATION,** a
national banking company having a place of business at 300 Main Street,
Stamford, Connecticut 06901 (the "Bank").
 
 **W
I T N E S S E T H** **:**
 
 **WHEREAS,** the
Original Borrowers and the Bank are parties to a Loan Agreement (the "Loan
Agreement") and a Security Agreement (the Security Agreement") each dated as of
October 23, 2003 and a Substitute Promissory Note dated January 5,
2004 in the original principal amount of $7,000,000 (the "Note"); and
 
 
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 **WHEREAS,** as of May
11, 2004, the Borrowers, including the Additional Borrower, the Guarantor and
the Bank entered into a Joinder and Assumption Agreement (the "Joinder and
Assumption Agreement" and, together with the Loan Agreement, the Security
Agreement, and the Note, the "Loan Documents"); and
 **WHEREAS,** the
Guarantor has executed an Unconditional Guaranty in favor of the Bank dated as
of October 23, 2003 (the "Guaranty") pursuant to which it has guaranteed
the obligations of the Borrowers under the Loan Documents, as more fully set
forth in the Guaranty; and
 **WHEREAS,** the
Borrower and the Guarantor have requested the Bank to revise the Financial
Covenants contained in the Loan Agreement and the Bank is willing to do so;
 **NOW,
THEREFORE,** in
consideration of One Dollar and other valuable considerations and the mutual
promises herein contained, the Borrowers, the Guarantor and the Bank hereby
agree as follows:
 1.  The
paragraph in the Loan Agreement entitled "Financial Covenants" is hereby amended
and restated to read, in full, as follows:
  **FINANCIAL
COVENANTS.** Borrower
agrees to the following provisions from the date hereof until final payment in
full of the Obligations, unless Bank shall otherwise consent in writing, using
the financial information for Borrower, its subsidiaries, affiliates and its
holding or parent company, as applicable: **Current
Ratio.** Borrower,
on an aggregate basis, shall, at all times, maintain a Current Ratio of not less
than 2.00 to 1.00. "Current Ratio" shall mean the ratio of Current Assets to
Current Liabilities. "Current Assets" shall mean all assets which are so
classified in accordance with generally accepted accounting principles. "Current
Liabilities shall mean all liabilities which are so classified in accordance
with generally accepted accounting principles. **Debt
Service Coverage Ratio.** Borrower,
on an aggregate basis, shall maintain a Debt Service Coverage Ratio of not less
than 1.50 to 1.00, to be calculated quarterly, as of the final day of each
fiscal quarter, on a rolling four quarters basis. "Debt Service Coverage Ratio"
is defined as earnings before interest, taxes, depreciation and amortization,
less unfinanced capital expenditures, less 50% of distributions to Borrower's
parent company, Raytech Corporation, plus (or minus) 50% of the changes in
advances to affiliates, divided by the sum of current maturities of long term
debt plus current maturities of capital lease obligations plus interest expense
paid during the previous four quarters. **Minimum
Cash Requirement.** Borrowers
shall, at all times, maintain cash deposits or marketable securities in an
amount of not less than $2,500,000.
 
 2
 
 2.  Each of
the Borrowers hereby represents and warrants to the Bank that all of the
representations and warranties made by it in the Loan Documents are true and
correct as of the date hereof as though they were made as of the date hereof
except as provided in Section 3 of the Joinder and Assumption Agreement. Each of
the Borrowers further represents and warrants to the Bank that there does not
exist any Event of Default under the Loan Documents or any event or condition
which with the passage of time, the giving of notice or both would constitute an
Event of Default thereunder, except for events or conditions which have been
waived by the Bank.
 3.  The
Borrowers and the Guarantor represent and warrant to the Bank that an affiliated
company, Raybestos Automotive Components Company, has decided to close its
manufacturing plant in Sterling Heights, Michigan on or before January 31, 2006
(the "Sterling Heights Closing") and further represent and warrant that, in
their judgment, the Sterling Heights Closing does not and will not constitute a
material adverse change with respect to the Borrowers or the Guarantor. The Bank
agrees that the Sterling Heights Closing, if completed on or before January 31,
2006, shall not be deemed to constitute a material adverse change for purposes
of the Loan Agreement.
 4.  The
Borrowers and the Guarantor each acknowledge and agree that the remaining
outstanding principal balance of the Note as of the date hereof is $5,583,333.39
and that said sum is absolutely and unconditionally owing from them to the Bank.
The Borrowers and the Guarantor further acknowledge and agree that neither they,
nor any of them, have any defense or claim of set off against payment of the
indebtedness evidenced by the Note.
 
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 5.  In all
other respects, except as expressly herein provided, each of the Loan Documents
shall be and remain in full force and effect.
 6.  The
Guarantor has executed this Agreement for the purpose of reaffirming the
Guaranty and confirming that it continues to remain in full force and effect.
 7.  For the
convenience of the parties, this Agreement may be executed in multiple
counterparts and on multiple signature pages. This Agreement, when executed by
all of the parties shall be binding on each of them, whether or not the
signatures are on the same or different signature pages.
 **8.**  **CONNECTICUT
PREJUDGMENT REMEDY WAIVER**
 EACH OF
THE BORROWERS AND THE GUARANTOR ACKNOWLEDGES THAT THE TRANSACTIONS REPRESENTED
BY THIS AGREEMENT ARE COMMERCIAL TRANSACTIONS AND HEREBY VOLUNTARILY AND
KNOWINGLY WAIVES ANY RIGHTS TO NOTICE OF AND HEARING ON PREJUDGMENT REMEDIES
UNDER CHAPTER 903A OF THE CONNECTICUT GENERAL STATUTES OR OTHER STATUTES
AFFECTING PREJUDGMENT REMEDIES, AND AUTHORIZES THE BANK'S ATTORNEY TO ISSUE A
WRIT FOR A PREJUDGMENT REMEDY WITHOUT COURT ORDER, PROVIDED THE COMPLAINT SHALL
SET FORTH A COPY OF THIS WAIVER.
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  **IN
WITNESS WHEREOF,** each of
the Borrowers and the Guarantor and the Bank have caused this Agreement to be
executed under seal as of the day and year first above written.
 
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**RAYTECH
      POWERTRAIN, INC.**
      
      
      By________________________________
      John
      B. Devlin, Treasurer
      
      **ALLOMATIC
      PRODUCTS COMPANY**
      
      
      By________________________________
      John
      B. Devlin, Vice President
      
      **RAYTECH
      SYSTEMS, INC.**
      
      
      By________________________________
      John
      B. Devlin, Treasurer
      
      **RAYBESTOS
      POWERTRAIN, LLC**
      
      
      By________________________________
      John
      B. Devlin, Financial Manager
      
      **RAYTECH
      CORPORATION**
      
      
      By________________________________
      John
      B. Devlin, Vice President,
      Treasurer,
      and Chief Financial Officer
      
      **WACHOVIA
      BANK,**
      **NATIONAL
      ASSOCIATION**
      By________________________________
      Patricia
      S. Gaudreau,
      Sr.
      Vice President
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