Tower Automotive lenders to vote on DIP amendments to change interest rates, dividend payment

By Caroline Salls

Pittsburgh, Sept. 22 - Tower Automotive, Inc. said its lenders are expected to vote on Oct. 5 on an amendment to its debtor-in-possession financing agreement that changes interest rates, amends covenants the company expects to violate in the fourth quarter and allows changes to payment of dividends, according to an 8-K filing with the Securities and Exchange Commission.

Under the dividend provision amendment, Tower is asking lenders to allow dividends to be declared and paid by less than wholly owned subsidiaries of the company.

The amendment also waives any existing covenant technical breaches related to previously declared and paid dividends by less than wholly owned subsidiaries.

The changes in interest rates will be based on the current economic environment, according to the filing.

The Novi, Mich.-based auto parts maker filed for bankruptcy on Feb. 1, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 11 case number is 05-10578.

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