Simpson Thacher has represented JPMorgan Chase Bank, N.A., as administrative agent under the $2.3 billion senior secured credit facilities, in connection with the Chapter 11 bankruptcy proceedings of Lear Corporation and certain of its subsidiaries filed on July 7, 2009. Lear is a leading global supplier of automotive seating systems, electrical distribution systems and electronic products with annual revenues in excess of $10 billion. It emerged from the Chapter 11 proceedings on November 9, 2009. Prior to the Chapter 11 filing and after extensive negotiations among the members of the respective steering committees, lenders representing in excess of two-thirds in principal amount outstanding under the credit facilities and bondholders holding in excess of a majority of the principal amount outstanding under Lear's $1.3 billion senior unsecured notes entered into support agreements under which they agreed to support a plan or reorganization for reorganized Lear. In conjunction with the restructuring, Simpson Thacher also represented JPMorgan Chase Bank, N.A. and J.P. Morgan Securities Inc. in connection with a $500 million new-money debtor-in-possession facility which provided, upon consummation of the pre-negotiated plan of reorganization and satisfaction of certain other conditions, for conversion into a $500 million exit facility at the time of emergence of the debtors from the Chapter 11 proceedings and a $400 million alternative exit facility raised prior to emergence that replaced the pre-negotiated exit facility. The innovative structure of having committed DIP financing convertible into exit financing in place prior to the Chapter 11 filings and supplementing a pre-negotiated plan of reorganization enabled Lear to proceed with its restructuring on an expedited basis and emerge from the Chapter 11 proceedings quickly without the risk of raising exit financing. Under the plan of reorganization, the pre-petition lenders received $100 million in cash and will hold $550 million in second lien loans, $450 million in preferred stock and about 60% of the fully diluted common stock of reorganized Lear.
The Simpson Thacher team working on the transaction includes Ken Ziman, Elisha Graff and Nick Baker (Bankruptcy), J.T. Knight, Stefanie Birkmann, Nick Feinberg, Jessica Tuchinsky, Samantha Braunstein and Ravi Purushotham (Banking and Credit), Caroline Gottschalk and Edward Shen (Corporate), Alvin Brown and Jennifer Pepin (Executive Compensation and Employee Benefits), Mardi Merjian (Real Estate), Mary Beth Forshaw, Mindy Lok and Crystal Frierson (Litigation/Intellectual Property) and Jonathan Goldstein and Amie Broder (Tax). Andrew Laird also provided invaluable paralegal and case management support.