Simpson Thacher & Bartlett LLP Collateral Perfection Summary for Dura Operating Corp. $225 Million Second Lien Credit Agreement
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This memorandum from Simpson Thacher & Bartlett LLP summarizes their review of the collateral securing a $225 million second lien credit agreement for Dura Operating Corp. The agreement involves Dura as borrower, several lenders, JPMorgan Chase as administrative agent, Wilmington Trust as collateral agent, and Banc of America Securities as syndication agent. The memo details the filing and perfection of security interests in personal and real property, and notes that these liens are contractually subordinated to a $175 million first lien credit agreement. The document lists relevant UCC filings and describes the collateral structure.
EX-10.1 2 k08114exv10w1.txt AUGUST 25, 2006 MEMO FROM SIMPSON THACHER & BARTLETT LLP EXHIBIT 10.1 SIMPSON THACHER & BARTLETT LLP TO: Dura Operating Corp. FROM: James Knight Colette Pollitt RE: $225,000,000 Second Lien Credit Agreement Collateral Perfection Summary DATE: August 25, 2006 The following is a summary of a review by Simpson Thacher & Bartlett LLP ("STB") of the collateral package with respect to the second lien Credit Agreement dated as of May 3, 2005, as amended by the First Amendment thereto dated as of March 29, 2006 (the "Credit Agreement"), among Dura Operating Corp., as Borrower (the "Borrower"), the several lenders from time to time parties thereto, JPMorgan Chase Bank, N.A., as Administrative Agent (the "Administrative Agent"), Wilmington Trust Company, as Collateral Agent (the "Collateral Agent") and Banc of America Securities LLC, as Syndication Agent. All capitalized terms not otherwise defined herein shall have the meanings set forth in the Credit Agreement. Pursuant to the Intercreditor Agreement between, among others, Bank of America, N.A., as first lien collateral agent (the "First Lien Collateral Agent") and the Collateral Agent, the liens created by the Loan Documents delivered in connection with the Credit Agreement are contractually subordinated to the liens securing obligations arising in connection with the $175,000,000 first lien Fifth Amended and Restated Credit Agreement. As part of the review process, STB reviewed the Credit Agreement and the other Loan Documents, acknowledgement copies of filed UCCs , executed mortgages, title policies and other relevant documentation. This report is based on our understanding as of the date hereof. Pursuant to the Security Agreement among the Loan Parties and the Collateral Agent, each Loan Party granted to the Collateral Agent for the ratable benefit of the Lenders, as security for Obligations under the credit documentation, a security interest in substantially all of its personal property, other than, among other exceptions, certain Excluded Property (as defined in the Security Agreement), in each case subject to the Intercreditor Agreement. In addition, each Loan Party granted to the Collateral Agent mortgages on certain real property. In general, a security interest in most types of tangible and intangible personal property is perfected by filing a UCC financing statement with the Secretary of State of the jurisdiction of organization in which the Loan Party is organized. With respect to security interests in the personal property collateral under the Security Agreement, an initial filing was made on or around May 2005 in recording offices in the name of "Bank of America, N.A., as Collateral Agent." Follow-on filings were made in the name of "Wilmington Trust Company" on or around August 16 and 17, 2006. With respect to real property collateral and collateral perfected by possession or control, the requisite mortgages and fixture filings and possession or control were effected by or on behalf of Wilmington Trust Company in May 2005 (or, if later, the date possessory Collateral was delivered to the First Lien Collateral Agent on behalf of Wilmington Trust Company). A. Perfection By Filing The following is a list of all of the UCC financing statements with "Bank of America, N.A., as Collateral Agent", as the secured party, the jurisdiction and date of filing for the Loan Parties:
The following is a list of all of the UCC financing statements with "Wilmington Trust Company", as the secured party, the jurisdiction and date of filing for the Loan Parties:
B. Perfection by Possession - Pledged Stock The Security Agreement provides for the grant of a security interest in each Loan Party's Investment Property (limited to 65% of the voting stock of first tier, non-U.S. subsidiaries), subject to the terms of the Intercreditor Agreement. In addition to perfection by the filings described above, pursuant to the terms of the Intercreditor Agreement, the First Lien Collateral Agent has agreed to hold Collateral in its possession or under its control for the benefit of the Collateral Agent in order to perfect the Collateral Agent's security interest therein. Our records indicate that the First Lien Collateral Agent has possession of certificates for the following companies: 4
C. Perfection in Certain Non-U.S. Jurisdictions In two countries the additional steps noted below were taken to perfect the pledge of stock identified below in favor of Wilmington Trust Company, as Collateral Agent:
D. Perfection by Possession - Pledged Notes Our records indicate that the First Lien Collateral Agent also has possession of the following intercompany notes for the benefit of itself and the Collateral Agent with the necessary note powers: 5
- ---------- (1) Face amount is as listed in the instrument delivered to the First Lien Collateral Agent in May 2005. E. Real Property The following 26 mortgages are in place with respect to owned properties in the United States. Our records indicate that each mortgage has been properly recorded. Title insurance was obtained in May 2005, and title date downs were performed, and amendments to the mortgages recorded, in March 2006 to account for the additional $75,000,000 of term loans funded under the Credit Agreement pursuant to an amendment to the Credit Agreement dated as of March 29, 2006.
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F. Intellectual Property The pledged intellectual property consists of patents, copyrights, trademarks and other intellectual property owned by the Loan Parties. The UCC filings above cover intellectual property. In addition, filings with the U.S. Patent and Trademark Office of the trademark security agreements were made on June 28, 2005, and the patent security agreements were made on June 28, 2005. G. Aircraft The Collateral Agent entered into an Aircraft Security Agreement, dated as of June 29, 2005, with Automotive Aviation Partners, LLC, as Debtor, as such agreement was recorded by the FAA on July 12, 2005 covering aircraft 1982 Dassault Falcon 50 and 3 engines Garrett model TFE 731-3-1C. 7 H. Additional Measures The Collateral Agent has entered into control agreements with respect to the following accounts:
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