Filed pursuant to Rule 424(b)(3)
File Number 333-150500
COOPER-STANDARD AUTOMOTIVE INC.
Supplement No. 6 to market-making prospectus dated April 9, 2009
The date of this supplement is August 3, 2009
On August 3, 2009, Cooper-Standard Holdings Inc. filed the attached Current Report on Form 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) – August 3, 2009
COOPER-STANDARD HOLDINGS INC.
(Exact name of registrant as specified in its charter)
| Delaware | 333-123708 | 20-1945088 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) | (I.R.S. Employer Identification Number) |
| 39550 Orchard Hill Place Drive, Novi, Michigan | 48375 | |
| (Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code (248) 596-5900
Check the appropriate box below in the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2 below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)) |
| Item 1.01. | Entry into a Material Definitive Agreement. |
Bankruptcy Filings
On August 3, 2009, Cooper-Standard Holdings Inc., a Delaware corporation (the “Company”), and each of its direct and indirect wholly-owned U.S. subsidiaries (collectively with the Company, the “Debtors”) filed voluntary petitions (the “Chapter 11 Petitions”) for relief under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Chapter 11 Petitions are being jointly administered under Case No. 09-12743 (the “Chapter 11 Cases”). The Debtors continue to operate their businesses and manage their properties as “debtors in possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court.
The Company expects that its Canadian subsidiary Cooper-Standard Automotive Canada Limited, a corporation organized under the laws of Ontario (the “Canadian Borrower”), will commence proceedings (the “Canadian Proceedings”) shortly after the filing of the Chapter 11 Petitions in the Ontario Superior Court of Justice in Canada (Commercial List) (the “Canadian Court”) pursuant to Canada’s Companies’ Creditors Arrangement Act. The Company’s subsidiaries and operations outside the United States are not included in the Chapter 11 Petitions or (except for the Canadian Borrower upon commencement of the Canadian Proceedings) any other proceeding outside the United States and are expected to continue to operate in the ordinary course of business.
A copy of the press release dated August 3, 2009 announcing, among other things, the filing of the Chapter 11 Petitions and the anticipated commencement of the Canadian Proceedings is attached hereto as Exhibit 99.1.
DIP Credit Agreement
In anticipation of filing the Chapter 11 Petitions and the commencement of the Canadian Proceedings, the Company has entered into a Debtor-In-Possession Credit Agreement, dated August 3, 2009 (the “DIP Credit Agreement”), among the Company, Cooper-Standard Automotive Inc., an Ohio corporation (the “U.S. Borrower”), and the Canadian Borrower (the U.S. Borrower and the Canadian Borrower are referred to herein as the “DIP Borrowers”), various lenders party thereto, Deutsche Bank Trust Company Americas, as the administrative agent (in such capacity, the “DIP Agent”), Banc of America Securities LLC, General Electric Corporation and UBS Securities LLC, as co-syndication agents, Deutsche Bank Trust Company Americas, as documentation agent, Deutsche Bank Securities Inc. and General Electric Capital Corporation, as joint lead arrangers and book runners, and Banc of America Securities LLC and UBS Securities LLC, as co-arrangers.
The lenders under the DIP Credit Agreement have committed to provide superpriority senior secured term loans to the DIP Borrowers and an additional non-U.S. subsidiary to be designated (the “Additional Foreign Borrower”) in an aggregate principal amount of up to $175 million (the “DIP Facility”) in connection with the Chapter 11 Cases and the Canadian Proceedings. Subject to approval of the DIP Facility by the Bankruptcy Court and the Canadian Court, $50 million of the DIP Facility will be available in a single draw upon the entry of an interim order by the Bankruptcy Court and an initial order by the Canadian Court, each in a form satisfactory to the lenders holding a majority of the outstanding loans and commitments under the DIP Facility (the “Required Lenders”). An additional $125 million of the DIP Facility will be available in a single draw upon the entry by the Bankruptcy Court of a final order approving the DIP Facility, subject to a cap of $75 million if the Additional Foreign Borrower does not become a borrower under the DIP Facility. An aggregate total of up to $125 million of the DIP Facility will be available for borrowing by the U.S. Borrower and an aggregate total of up to $50 million of the DIP Facility will be available for borrowing by the Canadian Borrower, each subject to reduction in the aggregate (on a dollar-for-dollar basis) by the amount of borrowings by the Additional Foreign Borrower. The DIP Credit Agreement also provides for an additional uncommitted $25 million incremental facility, for a total DIP Facility of up to $200 million (if the incremental facility is requested and committed to by the requisite lenders). Borrowings under the DIP Facility are subject to additional conditions customary for debtor-in-possession financings of this type.
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The obligations of the DIP Borrowers under the DIP Credit Agreement will be guaranteed by the Company and certain of its U.S. and foreign subsidiaries, subject to limitations on guarantees by foreign entities of the obligations of the DIP Borrowers. The obligations under the DIP Credit Agreement and related guarantees will be secured by liens on the assets of the DIP Borrowers and certain of the Company’s U.S. and foreign subsidiaries, subject to limitations on liens granted by foreign entities supporting certain of the obligations of the DIP Borrowers and guarantors. Liens under the DIP Credit Agreement will have first priority priming status with respect to substantially all of the assets of the DIP Borrowers and their subsidiaries in U.S. and Canada and will be entitled to superpriority administrative expense claim status in the Chapter 11 Cases.
The proceeds of the DIP Facility will be used for operating, working capital and other general corporate needs of the DIP Borrowers and their subsidiaries and the payment of fees and expenses in accordance with the orders of the Bankruptcy Court and the Canadian Court authorizing such borrowings.
Loans under the DIP Credit Agreement will bear interest at a rate per annum equal to (i) LIBOR (with a LIBOR floor of 3%) plus 10% or (ii) a base rate based on the higher of the federal funds overnight rate plus 0.5% and the prime lending rate (with a floor of 4%) plus 9%. Overdue principal and interest will bear interest at a default rate of 2% over the applicable rate as determined under the terms of the DIP Credit Agreement. In addition, the DIP Credit Agreement will obligate the DIP Borrowers to pay agency, up-front and exit fees to the DIP Agent and the lenders, as applicable.
The outstanding principal amount of the loans under the DIP Credit Agreement, plus accrued and unpaid interest thereon, will be due and payable in full at maturity, which is the earliest of: (i) the date that is 270 days after the date of the entry of the interim order by the Bankruptcy Court (the “Interim Order Entry Date”), (ii) the first date that both a plan of reorganization for each of the Company and its U.S. subsidiaries, which is confirmed by the Bankruptcy Court, and a plan of compromise or arrangement of the Canadian Borrower, which is confirmed by the Canadian Court, in each case providing for the repayment of the obligations under the DIP Credit Agreement, become effective, (iii) the date that is 30 days after the Interim Order Entry Date if the Bankruptcy Court has not entered a final order by such date and (iv) the acceleration of the DIP Facility or termination of the commitments thereunder, including, without limitation, as a result of the occurrence of an event of default. With the consent of the Required Lenders, and payment of an extension fee equal to 1% of the outstanding loans and commitments, the DIP Borrowers may at their option extend the maturity date by 90 days on up to two separate occasions.
The DIP Credit Agreement includes affirmative and negative covenants that will impose substantial restrictions on the financial and business operations of the Company and its subsidiaries, including their ability to incur and secure debt, make investments, sell assets, pay dividends or make acquisitions. The DIP Credit Agreement also contains certain financial covenants including (i) the achievement of a minimum amount of consolidated EBITDA, (ii) the maintenance of a minimum amount of liquidity and (iii) limitations on the amount of capital expenditures. The DIP Credit Agreement also contains various events of default that are customary for debtor-in-possession financings of this type.
A copy of the press release dated August 3, 2009 announcing, among other things, the entry into the DIP Credit Agreement is attached hereto as Exhibit 99.1.
Amendment to the Prepetition Credit Agreement
In anticipation of potentially obtaining debtor-in-possession financing in connection with the filing of the Chapter 11 Petitions and the commencement of the Canadian Proceedings, the Company, the U.S. Borrower, the Canadian Borrower and Cooper-Standard Automotive International Holdings B.V. (f/k/a Steffens Beheer BV), a corporation organized under the laws of the Netherlands (the “Dutch Borrower” and together with the U.S. Borrower and the Canadian Borrower, the “Prepetition Borrowers”), entered into
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the Fifth Amendment and Consent to Credit Agreement, dated July 14, 2009, with the lenders party thereto and the Prepetition Agent (as defined below), providing for the amendment of that certain Credit Agreement, dated as of December 23, 2004 (as amended from time to time, the “Prepetition Credit Agreement”), among the Company, the Prepetition Borrowers, as borrowers, the lenders party thereto (the “Senior Lenders”), Deutsche Bank Trust Company Americas, as administrative agent (in such capacity the “Prepetition Agent”), Lehman Commercial Paper Inc., as syndication agent, and Goldman Sachs Credit Partners, L.P., UBS Securities LLC and The Bank of Nova Scotia, as co-documentation agents, to permit, if the debtor-in-possession financing contemplated by the DIP Credit Agreement is approved by the Bankruptcy Court and the Canadian Court, (i) the borrowings and guarantees by the U.S. Borrower and the Canadian Borrower, and the granting of liens on the assets of the Company and its subsidiaries, pursuant to such debtor-in-possession financing and (ii) the Prepetition Agent’s entering into intercreditor agreements and/or amendments to the security and pledge agreements that secure the obligations under the Prepetition Credit Agreement to provide that any liens incurred pursuant to the debtor-in-possession financing will have priority over the liens under the Prepetition Credit Agreement.
Amended and Restated Limited Waiver under Prepetition Credit Agreement
On July 28, 2009, the Company and the Prepetition Borrowers entered into an Amended and Restated Limited Waiver (the “Amended and Restated Limited Waiver”) with various lenders and the Prepetition Agent. The Amended and Restated Limited Waiver amends and restates and expressly supersedes the Limited Waiver entered into by the Company and the Prepetition Borrowers on July 15, 2009 with the Prepetition Agent and the requisite lenders under the Prepetition Credit Agreement (the “Existing Limited Waiver”) as previously reported on a Form 8-K dated July 15, 2009. Pursuant to the Existing Limited Waiver, the waiver of certain defaults under the Prepetition Credit Agreement by the Senior Lenders would have automatically terminated on July 28, 2009 unless lenders holding at least a majority of the outstanding loans and commitments under the Prepetition Credit Agreement provided a notice of continuation. In lieu of such a notice, the parties thereto entered into the Amended and Restated Limited Waiver, which eliminated the July 28, 2009 automatic termination, thereby extending the potential outside date of the waiver until August 14, 2009. Upon the filing of the Chapter 11 Petitions, the waivers contained in the Amended and Restated Limited Waiver ceased to be effective.
| Item 1.03. | Bankruptcy or Receivership. |
On August 3, 2009, the Debtors filed the Chapter 11 Petitions. The Company expects that the Canadian Borrower will commence the Canadian Proceedings shortly thereafter. The information provided in Item 1.01 above regarding the Chapter 11 Petitions and the Canadian Proceedings is incorporated by reference into this Item 1.03.
A copy of the press release dated August 3, 2009 announcing, among other things, the filing of the Chapter 11 Petitions and the anticipated commencement of the Canadian Proceedings is attached hereto as Exhibit 99.1.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
On August 3, 2009 the Company and certain of its subsidiaries entered into the DIP Credit Agreement. The information provided in Item 1.01 above regarding the DIP Credit Agreement is incorporated by reference into this Item 2.03.
| Item 2.04 | Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement. |
The Chapter 11 Petitions described in Item 1.01 above constituted events of default, and triggered repayment obligations of the Company and certain of its subsidiaries, under (a) the Prepetition Credit Agreement, (b) the Indenture, dated as of December 23, 2004 (the “Senior Notes Indenture”), among the U.S. Borrower, certain subsidiary guarantors party thereto, including the Company, and
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Wilmington Trust Company, as trustee (the “Trustee”), as supplemented by that certain Supplemental Indenture No. 1, relating to the 7% Senior Notes due 2012 (the “Senior Notes”), and (c) the Indenture, dated as of December 23, 2004 (the “Senior Subordinated Notes Indenture”), among the U.S. Borrower, certain subsidiary guarantors party thereto, including the Company, and the Trustee, as supplemented by that certain Supplemental Indenture No. 1, relating to the 8 3/8% Senior Subordinated Notes due 2014 (the “Senior Subordinated Notes”), and triggered the termination rights of the counterparties to certain swap agreements entered into by the Company and its subsidiaries (the “Swap Agreements”).
As of August 3, 2009, approximately $608 million of principal and accrued and unpaid interest was outstanding under the Prepetition Credit Agreement, approximately $208.8 million of principal and accrued and unpaid interest was outstanding under the Senior Notes and approximately $329.9 million of principal and accrued and unpaid interest was outstanding under the Senior Subordinated Notes, and approximately $19.9 million in the aggregate was owed to counterparties under the Swaps Agreements. As a result of the filing of the Chapter 11 Petitions, the loan commitments of the lenders under the Prepetition Credit Agreement were terminated and all principal and accrued and unpaid interest outstanding under the Prepetition Credit Agreement, the Senior Notes and the Senior Subordinated Notes accelerated and became due and payable. The Company believes that any efforts to enforce such payment obligations are automatically stayed as a result of the Chapter 11 Petitions and applicable bankruptcy law.
| Item 8.01. | Other Events |
On August 3, 2008, the Company issued a press release announcing the filing of the Chapter 11 Petitions, the anticipated commencement of the Canadian Proceedings and the entry into the DIP Credit Agreement. A copy of the press release is attached hereto as Exhibit 99.1.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
| Exhibit Number |
Exhibit Description | |
| 99.1 | Press release, dated August 3, 2009 |
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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.
| COOPER-STANDARD HOLDINGS INC. |
| /s/ Timothy W. Hefferon |
| Timothy W. Hefferon |
Dated: August 3, 2009
EXHIBIT INDEX
| Exhibit |
Exhibit Description | |
| 99.1 | Press release, dated August 3, 2009 |
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Exhibit 99.1
| Contacts: | Sharon S. Wenzl | |||
| Cooper-Standard Automotive | ||||
| (248) 596-6211 | ||||
| sswenzl@cooperstandard.com | ||||
| Tom Becker | ||||
| Sitrick And Company | ||||
| (212) 573-6100 (Office) | ||||
| (646) 335-5188 (Mobile) | ||||
| tom_becker@sitrick.com | ||||
COOPER-STANDARD AUTOMOTIVE COMMENCES VOLUNTARY CHAPTER 11 CASES TO IMPLEMENT BALANCE SHEET RESTRUCTURING
| • | Obtains Commitment for $175 Million in Debtor in Possession Financing in order to continue normal operations |
| • | Company has made significant progress in negotiations with its lenders over the terms of the restructuring plan |
| • | Current proposal would reduce debt to approximately $350 million upon emergence |
NOVI, Mich. - August 3, 2009 - Cooper-Standard Holdings Inc., the parent company of Cooper-Standard Automotive Inc., announced today that the Company and its U.S subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in order to facilitate a balance sheet restructuring. The petitions were filed in the U.S. Bankruptcy Court in the District of Delaware. The Company’s Canadian subsidiary, Cooper-Standard Automotive Canada Limited, will seek relief under the Companies’ Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada.
Certain of the Company’s current lenders have agreed to provide the Company with up to $175 million in debtor-in-possession (DIP) financing. The DIP financing is subject to approval of the U.S. and Canadian bankruptcy courts. The Company will use the funds, along with its current cash balance and future cash flow, to formulate and implement a restructuring plan and pay normal operating expenses, including employee wages and payments to suppliers.
The Company intends to continue operating “business as usual” during the reorganization process and anticipates no interruption in its supply to customers. The filings include all wholly-owned U.S. and Canada operations. The Company’s joint venture entities in the U.S. and around the world are not included in the filing. Cooper-Standard’s other foreign subsidiaries are not included in the filing and will not be impacted.
The Company has been engaged in negotiations with its lenders and other constituents regarding a consensual restructuring plan. Significant progress has been made in these negotiations and the Company is hopeful that it will reach agreement with its lenders and
other constituents and be able to implement an agreement in the near term. Under the most recent proposal supported by holders of a majority of the Company’s senior secured debt, the Company’s balance sheet would be significantly deleveraged, as the Company would reduce its approximately $1.1 billion of bank and bond indebtedness to approximately $350 million. In addition, the lenders’ proposal contemplates an exit financing facility of $100 million to $150 million.
“Restructuring the Company’s balance sheet to align with the new automotive marketplace is the right decision at the right time,” said James S. McElya, Chairman and Chief Executive Officer of Cooper-Standard. “Today’s action will allow the Company to maintain its leadership position in the industry, preserve its business relationships and continue providing innovative technology to our customers. We expect to emerge from Chapter 11 a much stronger and more competitive Company.”
Cooper-Standard filed a variety of customary first day motions with the U.S. Bankruptcy Court in Delaware to enable it to continue business as usual during the restructuring, including requests to continue paying employee wages and benefits as usual.
The balance sheet restructuring follows an operational restructuring implemented in March 2009 that has enabled the Company to realize $47 million in annual savings.
Serving as lead restructuring advisors for Cooper-Standard are Fried Frank Harris Shriver & Jacobson LLP, Lazard Frères & Co. and Alvarez & Marsal.
More information about today’s announcement is available at www.cooperstandard.com. Additionally, the Company has set up a toll-free restructuring hotline at 888-329-3159.
About Cooper-Standard Automotive
Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is a leading global automotive supplier specializing in the manufacture and marketing of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and NVH control systems, which are represented within the company’s two operating divisions: North America and International. Cooper-Standard Automotive employs approximately 16,000 people globally with more than 70 facilities throughout the world. For more information, visit the company’s Web site at: www.cooperstandard.com.
This news release includes forward-looking statements, reflecting current analysis and expectations, based on what are believed to be reasonable assumptions. Forward-looking statements may involve known and unknown risks, uncertainties and other factors, which may cause the actual results to differ materially from those projected, stated or implied, depending on many factors, including, without limitation: the effects of the chapter 11 cases on the company; risks and uncertainties relating to approval by the Bankruptcy Court and the Canadian Court of the DIP financing; the ability to obtain court approval of motions in the chapter 11 proceedings from time to time; the ability to maintain contracts and suppliers and customer relationships; the ability to obtain exit financing; the ability of the company to develop, prosecute, confirm and consummate one or more plans of reorganization and to consummate the transactions contemplated thereby ; limitations on flexibility in operating business contained in the company’s debt agreements; the company’s dependence on the automotive industry; availability and cost of raw materials; the company’s dependence on certain major customers; competition in the industry; sovereign and other risks related to the company conducting operations outside the United States; the uncertainty of the company’s ability to achieve expected cost reduction savings; the company’s exposure to product liability and warranty claims; labor conditions; the company’s vulnerability to rising interest rates; the company’s ability to meet customers’ needs for new and improved products in a timely manner; the company’s ability to attract and retain key personnel; potential conflicts of interests between owners and the company; the company’s recent status as a stand-alone company; the
company’s legal rights to its intellectual property portfolio; the company’s underfunded pension plans; environmental and other regulations; and the possibility that the company’s acquisition strategy will not be successful. There may be other factors that may cause the company’s actual results to differ materially from the forward-looking statement. Accordingly, there can be no assurance that Cooper-Standard Automotive will meet future results, performance or achievements expressed or implied by such forward-looking statements. This paragraph is included to provide safe harbor for forward-looking statements, which are not generally required to be publicly revised as circumstances change, and which Cooper-Standard Automotive does not intend to update.