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Second Lien Group Takes Issue With Dura’s DIP Loan

Law360 (November 15, 2006, 12:00 AM EST) -- A committee of hedge funds that owns the majority of Dura Automotive Systems Inc.’s second lien obligations has objected to the auto parts maker’s plan to finance its Chapter 11 proceedings.

According to court documents filed Monday with the U.S. Bankruptcy Court in Delaware, the committee of second lien lenders is worried that certain provisions in Dura’s $300 million DIP loan will lower its recovery.

Overall, the first lien group is owed $124.4 million and the second lien group is owed $225 million. Though the hedge...
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