Exhibit 10.1
October 18, 2007
Dana Corporation
4500 Dorr Street
Toledo, OH 53615
Ladies and Gentlemen:
     Reference is made to the Investment Agreement, dated as of July 26, 2007
(as may be amended from time to time and together with all exhibits thereto, the
“Investment Agreement”), by and among Centerbridge Capital Partners, L.P., a
Delaware limited partnership (“Centerbridge LP”), CBP Parts Acquisition Co. LLC,
a newly formed Delaware limited liability company and subsidiary of Centerbridge
LP (“CBP Parts” and together with Centerbridge LP, “Centerbridge”), and Dana
Corporation, a Virginia corporation (the “Company”). The Investment Agreement,
among other things, sets forth certain terms and conditions on which
Centerbridge has agreed to purchase New Dana’s Series A Preferred and backstop
the sale of $250 million in liquidation preference of New Dana Series B
Preferred Stock. A true and correct copy of the Investment Agreement has been
provided to the investors whose names and addresses are listed on the signature
page hereto (each a “Series B-2 Backstop Investor” and collectively the
“Series B-2 Backstop Investors”). This commitment is being provided in
connection with the filing of a First Amended Joint Plan of Reorganization
substantially in the form attached here to as Exhibit A (the “Plan”).
Capitalized terms used but not defined in this letter agreement have the
meanings ascribed to such terms in the Investment Agreement.
     1. Commitment to Purchase Series B-2 Shares. The Series B-2 Backstop
Investors hereby agree that, subject to the second to last sentence of this
Section 1, upon satisfaction of all the conditions set forth in Sections 5.1 and
5.3 of the Investment Agreement, without waiver of any such conditions except
(a) waivers in which each Series B-2 Backstop Investor concurs and (b) waivers
by the Company, the Series B-2 Backstop Investors collectively will purchase up
to 2,900,000 Series B-2 Shares from New Dana for a price of $100 per share (the
“Series B-2 Purchase Price”) in cash at the Closing, in accordance with their
respective allocation percentages as set forth on Exhibit B attached hereto (the
“Commitment Percentage”) to the extent that Qualified Investors do not purchase
$540 million in liquidation preference of Series B Preferred Stock on the terms
set forth in Section 1.2 of the Investment Agreement, increased by $40 million
as provided in the Plan. The Company shall provide written notice to the
Series B-2 Backstop Investors no later than two business days prior to the
Closing of the aggregate number of shares of Series B Preferred Stock that are
not paid for by Qualified Investors and the corresponding aggregate purchase
price for such shares. The Series B-2 Backstop Investors and the Company
acknowledge and agree that their commitment to purchase Series B Preferred Stock
pursuant to this Agreement constitutes a several obligation of each of the
Series B-2 Backstop Investors. Each Series B-2 Backstop Investor acknowledges
that the Series B

 

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Preferred Stock that it may otherwise be entitled to purchase pursuant to the
Investment Agreement and the Plan as a Qualified Investor (“Eligible Purchase”)
may be subject to reduction to the extent its purchase obligations hereunder
together with any Series B Preferred under an Eligible Purchase would cause it
and its Affiliates to exceed the $200 million maximum in Section 1.2 of the
Investment Agreement. No Series B-2 Backstop Investor will be entitled to refuse
to fund their commitment to purchase Series B Preferred Stock pursuant to this
Agreement on the basis that the condition in Section 5.3(d) of the Investment
Agreement (the “MAC Condition”) has not been fulfilled unless and until all of
the Series B-2 Backstop Investors have first agreed in writing to assert that
the MAC Condition has not been fulfilled. Any declaration that the MAC condition
has not been fulfilled by fewer than all of the Series B-2 Backstop Investors
will not be effective and will have no effect on the obligation of any Series
B-2 Backstop Investor to pay its share of the Series B-2 Purchase Price to the
Company.
     2. Commitment Fee. In consideration of the Series B-2 Backstop Investors’
commitment to purchase the Series B Preferred Stock on the Effective Date
pursuant to this Agreement, the Company will pay to the Series B-2 Backstop
Investors an aggregate fee of $11.6 million to be allocated pro rata among each
Backstop Investor according to the percentages set forth on Exhibit B (the
“Series B-2 Commitment Fee”), which fee will be payable by the Company, without
duplication, when and if any of the following shall occur: (w) the Commitment
Fee is payable to Centerbridge pursuant to Section 7.1(d) or Section 7.2 of the
Investment Agreement, (x) the Termination Fee is payable to Centerbridge
pursuant to Section 7.1(c) of the Investment Agreement or Centerbridge is
entitled to be paid a fee and expenses pursuant to Section 7.1(a) or 7.1(b), (y)
the Company or Centerbridge terminate the Investment Agreement pursuant to
Section 6.1 of the Investment Agreement, or (z) the Company terminates the
Investment Agreement pursuant to Section 6.2(e), provided (in the case of
clauses (w), (x), (y) and (z)), that none of the Series B-2 Backstop Investors
is in material breach of this letter agreement and provided, further, that, if
(A) this Agreement is terminated prior to the any of the events in clauses (w),
(x), (y) or (z) having occurred or (B) the Series B-2 Backstop Investors assert
that the MAC Condition has not been fulfilled (unless such condition is
subsequently waived) and Centerbridge has not alleged that the MAC Condition has
not been fulfilled or has waived the MAC Condition, then in each such case no
Series B-2 Commitment Fee shall be payable, provided, further, that in the event
that a court of competent jurisdiction requires that Series B-2 Backstop
Investors to fund their commitments within a timeframe that does not delay the
Closing regardless of the fact that they have asserted that the MAC Condition
has not been fulfilled, then the Company shall pay the Series B-2 Commitment
Fee.
     The Series B-2 Commitment Fee will be paid by wire transfer of immediately
available funds to such account or accounts as are designated in writing to the
Company by each of the Series B-2 Backstop Investors. For the reasons set forth
in Section 7.5 of the Investment Agreement, the Series B-2 Commitment Fee, when
paid following any breach by the Company of any representation, warranty or
covenant in favor of the Series B-2 Backstop Investors contained in this letter
agreement, the Investment Agreement or in the Support Agreement, will be deemed
paid as liquidated damages.
     3. Representations and Warranties of the Company. The representations and
warranties of the Company set forth in Article II of the Investment Agreement
are incorporated herein by this reference and are made by the Company to the
Series B-2 Backstop Investors,

 

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subject to the qualifications set forth in Article II of the Investment
Agreement, including the qualifications and exceptions contained in the Company
Disclosure Letter notwithstanding that the Series B-2 Backstop Investors party
to this letter agreement have hereby waived their right to receive a copy of the
Company Disclosure Letter unless and until each has signed a confidentiality
agreement in the form of Exhibit C attached hereto (a “Confidentiality
Agreement”). A copy of the Company Disclosure Letter will be delivered to each
Series B-2 Backstop Investor promptly upon execution by such investor of a
Confidentiality Agreement. A copy of the Investment Agreement, together with any
amendments or supplements thereto, in effect as of the date hereof, has been
delivered to the Series B-2 Backstop Investors, but the Company Disclosure
Letter has not been delivered to the Series B-2 Backstop Investors. Each
Series B-2 Backstop Investor agrees to be bound by and charged with the
knowledge of all of the exceptions and disclosures in the Company Disclosure
Letter, including without limitation, exceptions to the covenants in Article IV
of the Investment Agreement.
     Except as and to the extent expressly set forth in this letter agreement or
incorporated by reference to the Investment Agreement as provided in the
immediately preceding paragraph, the Company makes no representations or
warranties whatsoever, and disclaims all liability and responsibility for any
representation, warranty, statement made or information communicated (orally or
in writing) to any Series B-2 Backstop Investor (including, but not limited to,
the information memorandum furnished to any Series B-2 Backstop Investor in
connection with their consideration of an investment in the Company and any
opinion, information or advice which may have been provided to any Series B-2
Backstop Investor or any of their respective Affiliates, by any officer,
stockholder, director, employee, engineering or accounting firm, legal counsel
or any other agent, consultant or representative of such party, as applicable).
     4. Representations, Warranties and Covenants of the Series B-2 Backstop
Investors. The representations and warranties of Centerbridge and the Purchaser
set forth in Article III of the Investment Agreement, other than Section 3.8(a)
thereof, are incorporated herein by this reference, mutatis mutandis
substituting references therein to Centerbridge and the Purchaser with
references to each Series B-2 Backstop Investor, and are made by each Series B-2
Backstop Investor to the Company.
     Each such Series B-2 Backstop Investor acknowledges that it and its
representatives has received or been afforded the opportunity to review prior to
the date hereof all written materials that the Company was requested to deliver
or make available, as the case may be, to such Series B-2 Backstop Investor
pursuant to this letter agreement on or prior to the date hereof; provided,
however, that the Company has not provided any information to the Series B-2
Backstop Investors executing this agreement that it considers to be of a
confidential nature as such Series B-2 Backstop Investors have expressly waived
their right to receive such information. Such Series B-2 Backstop Investors have
no Knowledge of any facts or circumstances that could reasonably be expected to
constitute a breach of the representations and warranties of the Company in this
letter agreement (including such representations and warranties incorporated by
reference from the Investment Agreement).
     5. No Survival of Representations and Warranties. None of the
representations and warranties in this letter agreement (or incorporated by
reference in this letter agreement) or in any instrument delivered pursuant to
this letter agreement shall survive the Closing.

 

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     6. Covenants. The covenants set forth in Sections 4.5 and 4.7 through 4.11
of the Investment Agreement are incorporated herein by this reference, mutatis
mutandis substituting references therein to Centerbridge and the Purchaser with
references to each Series B-2 Backstop Investor and subject to the exceptions
set forth in the Disclosure Letter, and are obligations of the Company to each
Series B-2 Backstop Investor and of each Series B-2 Backstop Investor to the
Company; provided, however, that no Series B-2 Backstop Investor that is a party
hereto shall have any rights under Section 4.6 of the Investment Agreement
unless and until such Series B-2 Backstop Investor executes and delivers to the
Company a confidentiality agreement having terms no less favorable to the
Company nor more favorable to such Series B-2 Backstop Investor than the
respective terms of the confidentiality agreement attached as Exhibit A to the
Approval Order, provided, further, however, that any consent given by
Centerbridge to Company actions pursuant to Section 4.5 will be deemed consent
of the Series B-2 Backstop Investors unless the Series B-2 Backstop Investors
unanimously object to such Centerbridge consent within three (3) business days
of receiving notice from the Company of such Centerbridge consent. The Company
agrees to provide the Backstop Investors with notice of any Centerbridge consent
to any actions pursuant to Section 4.5 of the Investment Agreement within one
(1) business day after Centerbridge gives such consent.
     As provided in the Plan, if (i) the resolution by the Debtors of an
objection to the Plan or Disclosure Statement made by or on behalf of a holder
of a Class 5B Claim or (ii) the resolution of any appeal to the approval of the
terms of the Global Settlement with Appaloosa Management, L.P. or any affiliate
thereof would require, in either such case, a payment to be made or other
consideration to be provided to such party (collectively, the “Dispute
Resolution”), the Debtors may agree to such resolution only with the reasonable
consent of the Series B-2 Backstop Investors and Centerbridge.
     7. Notice of Certain Events. Each Series B-2 Backstop Investor will
promptly notify the Company of any event or circumstance that at any time during
the term of this letter agreement could (a) result in or reasonably be expected
to result in any portion of the Series B-2 Purchase Price not being available to
any Series B-2 Backstop Investor, or (b) hinder or reasonably be expected to
hinder any Series B-2 Backstop Investor’s ability to perform its obligations
hereunder. No such notice will limit, alter or amend any Series B-2 Backstop
Investor’s obligations under this letter agreement.
     8. Approval Motion; Commitment Order. The Company’s obligations hereunder
are subject to approval by the Bankruptcy Court of the transactions contemplated
hereby and, where applicable, with respect to each individual Series B-2
Backstop Investor, receipt of an executed Confidentiality Agreement. The Company
agrees (i) to file a motion (the “Approval Motion”), in form and substance
reasonably satisfactory to the Series B-2 Backstop Investors, within ten
business days following the signing of this letter agreement, seeking an order
of the Bankruptcy Court approving this letter agreement and the payment of the
Series B-2 Commitment Fee provided for herein, and the release and exculpation
of the Series B-2 Backstop Investors, their affiliates, representatives and
advisors from any liability for participation in the commitment to purchase
Series B Preferred Stock pursuant to this Agreement (but excluding any liability
for breach of this Agreement or their willful misconduct or gross negligence
related thereto) to the fullest extent permitted under applicable law (such
release and exculpation, the “Release” and such order, the “Commitment Order”),
(ii) the Commitment Order shall have been entered by the

 

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Bankruptcy Court within twenty-five calendar days after the motion seeking the
same is filed, and (iii) the Commitment Order shall not have been stayed,
modified or vacated within ten calendar days after the Commitment Order shall
have been entered by the Bankruptcy Court. The Company will use its reasonable
best efforts to ensure that the Commitment Order approves the Release.
     9. Term. This letter agreement shall terminate and be of no further force
or effect upon the earlier of (a) both the consummation of the Closing and the
payment in full of the Series B-2 Purchase Price by each Series B-2 Backstop
Investor or (b) the termination of the Investment Agreement in accordance with
its terms. Each Backstop Party shall have the right to terminate this letter
agreement with respect to its individual commitment hereunder in the event that
(x) the Approval Motion or the Commitment Order are not filed and entered
(including the requirement of such order not being stayed, modified or vacated),
respectively, within the time periods set forth in Section 8 hereof, (y) a
Dispute Resolution is entered into by the Company without the consent of all of
the Series B-2 Backstop Investors or (z) the Closing has not occurred on or
before February 28, 2008.
     10. Notices. Any notice or other communication required to be given
hereunder will be in writing, and sent by reputable courier service (with proof
of service), by hand delivery, or by email or facsimile (followed on the same
day by delivery by courier service (with proof of delivery) or by hand
delivery), addressed as follows:
     If to any Series B-2 Backstop Investor:
To the address, email or facsimile set forth beneath such Series B-2 Backstop
Investor’s signature on the signature page to this letter agreement.
     With a copy to:
Stroock & Stroock & Lavan LLP
180 Maiden Lane
New York, New York 10038-4982
Attention:      Kristopher M. Hansen
Email:              khansen@stroock.com
Fax:                 (212) 806-6006
and
Attention:      Brett Lawrence
Email:              blawrence@stroock.com
Fax:                 (212) 806-6006
     If to the Company or New Dana:
Dana Corporation (or the name of New Dana)
4500 Dorr Street
Toledo, OH 43615
Attention:      General Counsel and Secretary

 

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Email:
Fax:                  (419) 535-4544
     With copies to:
Jones Day
222 East 41st Street
New York, New York 10017
Attention:      Corinne Ball
Email:              cball@jonesday.com
Fax:                  (212) 755-7306
and
Attention:       Marilyn W. Sonnie
Email:               mwsonnie@jonesday.com
Fax:                  (212) 755-7306
     If to Centerbridge or Purchaser:
Centerbridge Capital Partners, L.P.
375 Park Avenue, 12th Floor
New York, NY 10152
Attention:      Jeffrey Aronson
Email:              jaronson@centerbridge.com
Fax:                 (212) 672-6501
and
Attention:      David Trucano
Email:             dtrucano@centerbridge.com
Fax:                 (212) 672-6501
     With copies to:
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, New York 10019
Attention:      Matthew A. Feldman
Email:              mfeldman@wilkie.com
Fax:                 (212) 728-9651
and
Attention:      Jeffrey R. Poss
Email:              jposs@wilkie.com
Fax:                 (212) 728-9536

 

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or to such other address as any party will specify by written notice so given,
and such notice will be deemed to have been delivered as of the date so
telecommunicated or personally delivered.
     11. Jurisdiction; Consent to Service of Process. (a) Each party hereby
irrevocably and unconditionally submits, for itself and its property, to the
exclusive jurisdiction of the Bankruptcy Court, and any appellate court from any
such court, in any suit, action or proceeding arising out of or relating to this
letter agreement or the transactions contemplated hereby, or for recognition or
enforcement of any judgment resulting from any such suit, action or proceeding,
and each party hereby irrevocably and unconditionally agrees that all claims in
respect of any such suit, action or proceeding may be heard and determined in
the Bankruptcy Court.
     (b) It will be a condition precedent to each party’s right to bring any
such suit, action or proceeding that such suit, action or proceeding, in the
first instance, be brought in the Bankruptcy Court, and if each such court
refuses to accept jurisdiction with respect thereto, such suit, action or
proceeding may be brought in any other court with jurisdiction.
     (c) No party may move to (i) transfer any such suit, action or proceeding
from the Bankruptcy Court to another jurisdiction, (ii) consolidate any such
suit, action or proceeding brought in the Bankruptcy Court with a suit, action
or proceeding in another jurisdiction, or (iii) dismiss any such suit, action or
proceeding brought in the Bankruptcy Court for the purpose of bringing the same
in another jurisdiction.
     (d) Each party hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, (i) any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this letter agreement in the Bankruptcy
Court, (ii) the defense of an inconvenient forum to the maintenance of such
suit, action or proceeding in any such court, and (iii) the right to object,
with respect to such suit, action or proceeding, that such court does not have
jurisdiction over such party. Each party irrevocably consents to service of
process in any manner permitted by law.
     12. Miscellaneous. This letter agreement (a) may be executed in any number
of counterparts, each of which shall be deemed to be an original but all of
which together shall be deemed to be one and the same agreement, (b) shall be
governed by and construed in accordance with the laws of the State of New York
without giving effect to its conflicts of laws principles, (c) constitutes the
entire agreement of the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
of the parties with respect to the subject matter of this letter agreement, and
(d) may be amended only by a writing signed by each of the parties hereto;
provided, however, that no provision of the Investment Agreement incorporated
into this Agreement may be amended in a manner that adversely affects any one of
the Series B-2 Backstop Investors without the written consent of each of the
Series B-2 Backstop Investors and this Agreement may not be amended in a manner
that adversely affects Centerbridge without the written consent of Centerbridge.
No provision of this letter agreement is intended to confer any rights,
benefits, remedies, obligations or liabilities hereunder upon any person other
than the parties hereto and their respective successors and permitted assigns.
This letter agreement is not assignable by any of the parties hereto without the
prior written consent of the other party.

 

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                Avenue Special Situations Fund IV, L.P.
 
  By:   Avenue Capital Partners IV, LLC, its General Partner
 
  By:   GL Partners IV, LLC, its General Partner
 
       
 
  By:   /s/ Sonia Gardner
 
       
 
      Name: Sonia Gardner
 
      Title:
 
       
 
            Avenue Special Situations Fund V, L.P.
 
  By:   Avenue Capital Partners V, LLC, its General Partner
 
  By:   GL Partners V, LLC, its General Partner
 
       
 
  By:   /s/ Sonia Gardner
 
       
 
      Name: Sonia Gardner
 
      Title:
 
       
 
            Avenue International, Ltd.
 
       
 
  By:   /s/ Sonia Gardner
 
       
 
      Name: Sonia Gardner
 
      Title:
 
       
 
            Avenue Investments, L.P.
 
  By:   Avenue Partners, LLC, its General Partner
 
       
 
  By:   /s/ Sonia Gardner
 
       
 
      Name: Sonia Gardner
 
      Title:
 
       
 
            Avenue-CDP Global Opportunities Fund, L.P.
 
  By:   Avenue Global Opportunities Fund GenPar, LLC its
General Partner
 
       
 
  By:   /s/ Sonia Gardner
 
       
 
      Name: Sonia Gardner
Title:
 
       

         
 
  Address for Notices:   535 Madison Avenue 14th Floor
New York, NY 10022

 

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                Dune Capital Management LP
 
       
 
  By:   /s/ Joshua P. Eaton
 
       
 
      Name: Joshua P. Eaton
 
      Title: General Counsel

         
 
  Address for Notices:   c/o Dune Capital Management LP
623 Fifth Avenue, 30th Floor
New York, NY 10022
Attn: Joshua P. Eaton, General Counsel
Fax: 646-885-2452
Email: josheaton@dunecapital.com

 

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                Franklin Mutual Advisers, LLC
 
       
 
  By:   /s/ Shawn Tumulty
 
       
 
      Name: Shawn Tumulty
Title: Vice President
 
       

         
 
  Address for Notices:   101 JFK Parkway
Short Hills, NJ 07078

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                QDRF Master Ltd.
 
  By:   Quadrangle Debt Recovery Advisors LP
 
  Its:   Advisor
 
       
 
  By:   /s/ Andrew Herenstein
 
       
 
      Name: Andrew Herenstein
 
      Title: Managing Principal
 
       
 
            Quadrangle Debt Opportunities Fund Master Ltd
 
  By:   Quadrangle Debt Recovery Advisors LP
 
  Its:   Advisor
 
       
 
  By:   /s/ Andrew Herenstein
 
       
 
      Name: Andrew Herenstein
 
    Title: Managing Principal
 
       
 
            Quadrangle Debt Recovery Income Fund Master Ltd
 
  By:   Quadrangle Debt Recovery Advisors LP
 
  Its:   Advisor
 
       
 
  By:   /s/ Andrew Herenstein
 
       
 
      Name: Andrew Herenstein
 
      Title: Managing Principal

         
 
  Address for Notices:   375 Park Avenue, 14th Fl
New York, NY 10152

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                Silver Point Capital Fund, L.P.
 
  By:   Silver Point Capital, L.P., its investment manager
 
       
 
  By:   /s/ Michael Gatto
 
       
 
      Name: Michael Gatto
 
      Title:
 
       
 
            Silver Point Capital Offshore Fund, L.P.
 
  By:   Silver Point Capital, L.P., its investment manager
 
       
 
  By:   /s/ Michael Gatto
 
       
 
      Name: Michael Gatto
 
      Title:

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                Davidson Kempner Capital Management LLC and Affiliates
 
       
 
  By:   /s/ Avi Friedman
 
       
 
      Name: Avi Friedman
 
      Title: Managing Member

         
 
  Address for Notices:   65 East 55th, Suite 1900
New York, NY 10022

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          ACKNOWLEDGED and AGREED As of this 18th day of October 2007:
 
        DANA CORPORATION
 
       
By:
  /s/ Marc S. Levin
 
   
 
  Name: Marc S. Levin
 
  Title: Acting Secretary
 
        ACKNOWLEDGED, AGREED AND CONSENTED TO:
As of this 18th day of October 2007:
 
        CENTERBRIDGE CAPITAL PARTNERS, L.P.

By:
  Centerbridge Associates, L.P.,
its general partner
By: Centerbridge GP Investors, LLC
        its general partner    
 
       
By:
  /s/ Jeff Aronson
 
   
 
  Name: Jeff Aronson
 
  Title:   Authorized Person    
 
        CENTERBRIDGE CAPITAL PARTNERS STRATEGIC, L.P.
By:
  Centerbridge Associates, L.P.,
its general partner
By: Centerbridge GP Investors, LLC,
        its general partner    
 
       
By:
  /s/ Jeff Aronson
 
   
 
  Name: Jeff Aronson
 
  Title:   Authorized Person    
 
        CENTERBRIDGE CAPITAL PARTNERS SBS, L.P.
By:
  Centerbridge Associates, L.P.,
its general partner
By: Centerbridge GP Investors, LLC,
        its general partner    

 

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By:
  /s/ Jeff Aronson
 
   
 
  Name: Jeff Aronson
 
  Title:   Authorized Person