1
EXHIBIT 10.
PURCHASE AGREEMENT
Banc One Capital Markets, Inc.
Xxxxxxx, Xxxxx & Co.
c/o Banc One Capital Markets, Inc.
One First Xxxxxxxx Xxxxx, Xxxx Xxxxx 0000
Xxxxxxx, XX 00000
Dear Sirs:
Venture Holdings Trust, a grantor trust organized under the
laws of Michigan (the "Trust"), proposes upon the terms and conditions set forth
herein, to issue and sell to you, as the initial purchasers (individually, an
"Initial Purchaser" and, collectively, the "Initial Purchasers"), $125,000,000
aggregate principal amount of its Senior Notes due 2007 (the "Senior Notes") and
$125,000,000 aggregate principal amount of its Senior Subordinated Notes due
2009 (the "Senior Subordinated Notes" and together with the Senior Notes, the
"Notes"). The Senior Notes are to be issued pursuant to the provisions of a
Senior Indenture, to be dated as of the Closing Date (as defined), between the
Issuers (as defined) and The Huntington National Bank, as Trustee (the
"Trustee"). The Senior Subordinated Notes are to be issued pursuant to the
provisions of a Senior Subordinated Indenture to be dated as of the Closing Date
between the Issuers and the Trustee. The Senior Indenture and the Senior
Subordinated Indenture are collectively referred to herein as the "Indentures."
The Notes will be guaranteed (the "Subsidiary Guarantees") by each of Vemco,
Inc., Venture Industries Corporation, Venture Mold & Engineering Corporation,
Venture Leasing Company, Vemco Leasing, Inc., Venture Holdings Corporation,
Venture Service Company, Venture Europe, Inc. and Venture EU Corporation, each a
Michigan corporation, Experience Management LLC and Venture Holdings Company
LLC, each a Michigan limited liability company (each a "Guarantor" and
collectively, the "Guarantors," and, together with the Trust, the "Issuers").
Each direct or indirect subsidiary of the Trust, as of the Closing Date, are the
entities listed on Schedule A hereto (the "Trust Subsidiaries") and each
material subsidiary of Peguform GmbH ("Peguform"), as of the Closing Date, are
the entities listed on Schedule B hereto (the "Peguform Subsidiaries" and
together with Peguform and the Trust Subsidiaries, the "Subsidiaries"). The
Notes are being issued to finance, in part, the acquisition of Peguform by
certain subsidiaries of the Trust (the "Acquisition").
Each of the Issuers wishes to confirm as follows its agreement
with the Initial Purchasers in connection with the purchase and resale of the
Notes.
1. PRELIMINARY OFFERING MEMORANDUM AND OFFERING MEMORANDUM. The
1
2
Notes will be offered and sold to the Initial Purchasers without registration
under the Securities Act of 1933, as amended (the "Act"), in reliance on an
exemption pursuant to Section 4(2) under the Act. The Issuers have prepared a
preliminary offering memorandum, dated May 7, 1999 (the "Preliminary Offering
Memorandum"), and an offering memorandum, dated May 25, 1999 (the "Offering
Memorandum"), setting forth information regarding the Issuers, the Notes and the
Subsidiary Guarantees. Any references herein to the Preliminary Offering
Memorandum shall be deemed to include all amendments and supplements thereto.
Any references herein to the Offering Memorandum shall refer to the Offering
Memorandum in the form first furnished to the Initial Purchasers for use in
connection with the offering of the Notes. Each of the Issuers hereby confirms
that it has authorized the use of the Preliminary Offering Memorandum and the
Offering Memorandum in connection with the offering and resale of the Notes by
the Initial Purchasers.
The Initial Purchasers have advised the Issuers that the
Initial Purchasers propose to make offers and sales (the "Exempt Resales") of
the Notes purchased by the Initial Purchasers hereunder only on the terms and in
the manner set forth in the Offering Memorandum and Section 2 hereof, as soon as
the Initial Purchasers deem advisable after this Agreement has been executed and
delivered, (i) to persons in the United States whom the Initial Purchasers
reasonably believe to be qualified institutional buyers ("Qualified
Institutional Buyers") as defined in Rule 144A under the Act, as such rule may
be amended from time to time ("Rule 144A"), in transactions under Rule 144A and
(ii) to persons permitted to purchase the Notes in offshore transactions in
reliance upon Regulation S under the Act in private sales exempt from
registration under the Act (such persons specified in clauses (i) and (ii) being
referred to herein as the "Eligible Purchasers").
It is understood and acknowledged that upon original issuance
thereof, and until such time as the same is no longer required under the
applicable requirements of the Act, the Notes shall bear a legend substantially
to the effect set forth below:
"THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT
BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR IN
ACCORDANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (SUBJECT TO THE DELIVERY OF
SUCH EVIDENCE, IF ANY, REQUIRED UNDER THE INDENTURE PURSUANT
TO WHICH THIS NOTE IS ISSUED) AND IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR
ANY OTHER JURISDICTION. EACH PURCHASER OF THE SECURITY EVIDENCED
HEREBY IS
2
3
HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER OR ANOTHER EXEMPTION UNDER THE SECURITIES
ACT. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR
THE BENEFIT OF THE COMPANY THAT (a) SUCH SECURITY MAY BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(A) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (B) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT
PRIOR TO SUCH TRANSFER PROVIDES TO THE TRUSTEE FOR THE NOTES A
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THE NOTES (THE
FORM OF THE LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR THE
NOTES), (C) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES TO
A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 904 UNDER THE SECURITIES ACT, OR (E) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON CERTIFICATES AND AN OPINION OF
COUNSEL IF THE COMPANY SO REQUESTS), AS LONG AS THE REGISTRAR
RECEIVES A CERTIFICATION OF THE TRANSFEROR AND AN OPINION OF
COUNSEL THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (b)
THE HOLDER WILL AND EACH SUBSEQUENT HOLDER IS REQUIRED TO
NOTIFY ANY PURCHASER FROM IT OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTION SET
FORTH IN (a) ABOVE."
It is also understood and acknowledged that holders (including
subsequent transferees) of the Notes will have the registration rights set forth
in the registration rights agreement (the "Registration Rights Agreement") in
substantially the form of Exhibit A hereto, to be dated as of the Closing Date.
3
4
2. AGREEMENTS TO SELL, PURCHASE AND RESELL. (a) Each of the Issuers
hereby agrees, subject to all the terms and conditions set forth herein, to
issue and sell to the Initial Purchasers and, upon the basis of the
representations, warranties and agreements of the Issuers herein contained and
subject to all the terms and conditions set forth herein, the Initial Purchasers
agree, severally and not jointly, to purchase the principal amount of Notes
(together with the related Subsidiary Guarantees) set forth opposite the name of
such Initial Purchaser on Schedule C hereto from the Trust at a purchase price
of 97.25% of the entire principal amount of the Senior Notes purchased and a
purchase price of 97.125% of the entire principal amount of the Senior
Subordinated Notes purchased.
(b) The Initial Purchasers have advised the Issuers that
they propose to offer the Notes for sale upon the terms and conditions set forth
in this Agreement and in the Offering Memorandum. The Initial Purchasers
severally and not jointly hereby represent and warrant to, and agree with, the
Issuers that (i) they are Qualified Institutional Buyers, with such knowledge
and experience in financial and business matters as are necessary in order to
evaluate the merits and risks in an investment in the Notes and are purchasing
the Notes pursuant to a private sale exempt from registration under the Act,
(ii) they have not and will not solicit offers for, or offer or sell, the Notes
by means of any form of general solicitation or general advertising or in any
manner involving a public offering within the meaning of Section 4(2) of the
Act, (iii) they will solicit offers for the Notes only from, and will offer,
sell or deliver the Notes as part of its initial offering, only to (A) persons
in the United States whom they reasonably believe to be Qualified Institutional
Buyers, or if any such person is buying for one or more institutional accounts
for which such person is acting as fiduciary or agent, only when such person has
represented to the Initial Purchasers that each such account is a Qualified
Institutional Buyer, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, in each case, in transactions under Rule
144A or (B) persons permitted to purchase the Notes in offshore transactions in
reliance upon Regulation S under the Act, (iv) they will, during their initial
distribution of the Notes, unless prohibited by applicable law, furnish to each
person to whom they sell any Notes a copy of the Offering Memorandum, (v) they
and their affiliates or any person acting on either of their behalf has not
engaged, and will not engage, in any directed selling efforts within the meaning
of Regulation S with respect to the Notes or the Subsidiary Guarantees, (vi) the
Notes offered and sold by them pursuant hereto in reliance on Regulation S have
been and will be offered and sold only in offshore transactions, (vii) the sale
of the Notes offered and sold by the Initial Purchasers pursuant hereto in
reliance on Regulation S is not part of a plan or scheme to evade the
registration provisions of the Act, (viii) they have not offered or sold and
will not offer or sell the Notes in the United States or to, or for the benefit
or account of, a U.S. Person (other than a distributor), in each case, as
defined in Rule 902 under the Act (a) as part of its distribution at any time
and (b) otherwise until 40 days after the later of the commencement of the
offering of the Notes pursuant hereto and the Closing Date, other than in
accordance with Regulation S of the Act or another exemption from the
registration requirements of the Act, (ix) during such 40-day distribution
compliance period, it will not cause any advertisement with respect to the
Series A Notes (including any "tombstone" advertisement) to be published in any
newspaper or periodical or posted in any public place and will not issue any
circular relating to the Notes, except such advertisements as are permitted by
and include the statements required by Regulation S, (x) at or prior to
confirmation of a sale of Notes by it to any distributor, dealer or person
receiving a selling concession, fee or other remuneration during the 40-day
distribution compliance period referred to in Rule 903(c)(2) under the Act, it
will send to such distributor, dealer or person receiving a selling concession,
fee or other remuneration a confirmation or notice to substantially the
following effect: "The Notes covered hereby have not been registered under the
U.S. Securities Act of 1933, as amended
4
5
(the "Securities Act"), and may not be offered and sold within the United States
or to, or for the account or benefit of, U.S. persons (i) as part of your
distribution at any time or (ii) otherwise until 40 days after the later of the
commencement of the Offering and the Closing Date, except in either case in
accordance with Regulation S under the Securities Act (or Rule 144A or to
Accredited Institutions in transactions that are exempt from the registration
requirements of the Securities Act), and in connection with any subsequent sale
by you of the Notes covered hereby in reliance on Regulation S during the period
referred to above to any distributor, dealer or person receiving a selling
concession, fee or other remuneration, you must deliver a notice to
substantially the foregoing effect. Terms used above have the meanings assigned
to them in Regulation S."
The Initial Purchasers have advised the Issuers that they will
offer the Notes to Eligible Purchasers at a price and upon terms set forth in
the Offering Memorandum. Such price and terms may be changed by the Initial
Purchasers at any time thereafter without notice.
The Initial Purchasers understand that the Issuers and, for
purposes of the opinions to be delivered to the Initial Purchasers pursuant to
Section 7 hereof, counsel to the Issuers and counsel to the Initial Purchasers,
will rely upon the accuracy and truth of the foregoing representations and
agreements and the Initial Purchasers hereby consent to such reliance.
3. DELIVERY OF THE NOTES AND PAYMENT THEREFOR. Delivery to the Initial
Purchasers of and payment for the Notes shall be made at the office of Xxxxxx
Xxxxxxx PLLC, 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, at 9:00 A.M., New
York City time, on May 27, 1999 (the "Closing Date"). The place of closing for
the Notes and the Closing Date may be varied by agreement between the Initial
Purchasers and the Issuers.
The Notes which the Initial Purchasers may elect to purchase
will be delivered to the Initial Purchasers against payment of the purchase
price therefor in immediately available (same day) funds wired in accordance
with the instructions of the Issuers. The Notes will be evidenced by one or more
global securities in definitive form (the "Global Notes") and/or by additional
definitive securities, and will be registered, in the case of the Global Notes,
in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"),
and in the other cases, in such names and in such denominations as the Initial
Purchasers shall request prior to 9:30 A.M. New York City time, on the second
business day preceding the Closing Date. The Notes to be delivered to the
Initial Purchasers shall be made available to the Initial Purchasers in New York
City for inspection and packaging not later than 2:00 P.M., New York City time,
on the business day next preceding the Closing Date.
4. AGREEMENTS OF THE ISSUERS. Each of the Issuers agrees with the
Initial Purchasers as follows:
(a) The Issuers will advise the Initial Purchasers promptly
and, if requested by them, will confirm such advice in writing, within the
period of time referred to in the first sentence of subsection (e) below, of any
change in the Trust or any of the
5
6
Subsidiaries condition (financial or other), business, prospects, properties,
net worth or results of operations, or of the happening of any event, which
change or happening makes any material statement made in the Offering Memorandum
(as then amended or supplemented) untrue or which requires the making of any
additions to or changes in the Offering Memorandum (as then amended or
supplemented) in order to make the statements therein, in the light of the
circumstances in which they were made, not misleading, or of the necessity to
amend or supplement the Offering Memorandum (as then amended or supplemented) to
comply with any law.
(b) The Issuers will furnish to the Initial Purchasers,
without charge, as of the date of the Offering Memorandum, such number of copies
of the Offering Memorandum as may then be amended or supplemented as they may
reasonably request.
(c) The Issuers will not make any amendment or supplement to
the Preliminary Offering Memorandum or to the Offering Memorandum of which the
Initial Purchasers shall not previously have been advised or to which it shall
reasonably object by written notice to the Issuers within three (3) business
days after being so advised, and no such amendment or supplement when it is
made, shall contain an untrue statement of a material fact or will omit to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances in which they were made,
not misleading.
(d) Prior to the execution and delivery of this Agreement,
the Issuers have delivered or will deliver to the Initial Purchasers, without
charge, in such quantities as the Initial Purchasers shall have requested or may
hereafter reasonably request, copies of the Preliminary Offering Memorandum.
Each of the Issuers consents to the use, in accordance with the securities or
Blue Sky laws of the jurisdictions in which the Notes are offered by the Initial
Purchasers and by dealers, prior to the date of the Offering Memorandum, of each
Preliminary Offering Memorandum so furnished by the Issuers. Each of the Issuers
consents to the use of the Offering Memorandum (and of any amendment or
supplement thereto) in accordance with the securities or Blue Sky laws of the
jurisdictions in which the Notes are offered by the Initial Purchasers in
connection with the offering and sale of the Notes.
(e) If, at any time prior to completion of the distribution
of the Notes by the Initial Purchasers to Eligible Purchasers, any event shall
occur that in the judgment of any of the Issuers or in the opinion of the
Initial Purchasers' counsel should be set forth in the Offering Memorandum (as
then amended or supplemented) in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary to supplement or amend the Offering Memorandum in order to comply
with any law, the Issuers will forthwith prepare an appropriate supplement or
amendment thereto, and will expeditiously furnish to the Initial Purchasers a
reasonable number of copies thereof.
(f) The Issuers will cooperate with the Initial Purchasers
and with its
6
7
counsel in connection with the qualification of the Notes for offering and sale
by the Initial Purchasers and by dealers under the securities or Blue Sky laws
of such jurisdictions as the Initial Purchasers may designate and will file such
consents to service of process or other documents necessary or appropriate in
order to effect such qualification; provided that in no event shall the Issuers
be obligated to qualify to do business or subject themselves to income taxation
in any jurisdiction where it is not now so qualified or to take any action which
would subject it to service of process in suits, other than those arising out of
the offering or sale of the Notes, in any jurisdiction where it is not now so
subject.
(g) Upon the request of the Initial Purchasers, for a period
of five years after the Closing Date, the Issuers will furnish to the Initial
Purchasers (i) as soon as available, a copy of each report of the Issuers mailed
to holders of the Notes or filed with the Securities and Exchange Commission or
similar foreign entity and (ii) from time to time such other information
concerning the Trust and the Subsidiaries as the Initial Purchasers may
reasonably request.
(h) If this Agreement shall terminate or shall be terminated
pursuant to any provisions hereof (otherwise than by notice given by the Initial
Purchasers terminating this Agreement pursuant to Section 9 hereof) or if this
Agreement shall be terminated by the Initial Purchasers because of any failure
or refusal on the part of any of the Issuers to comply with the terms or fulfill
any of the conditions of this Agreement, each of the Issuers, jointly and
severally, agrees to reimburse the Initial Purchasers for all reasonable
out-of-pocket expenses (including fees and expenses of its counsel) reasonably
incurred by it in connection herewith, but without further obligation on the
part of the Issuers for loss of profits or otherwise.
(i) The Issuers will apply the net proceeds from the sale of
the Notes to be sold by it hereunder substantially in accordance with the
description set forth in the Offering Memorandum under the caption "Use of
Proceeds."
(j) Except as stated in this Agreement and in the Preliminary
Offering Memorandum and Offering Memorandum, none of the Trust or the
Subsidiaries has taken, nor will they take, directly or indirectly, any action
designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Notes to facilitate the sale
or resale of the Notes. Except as permitted by the Act, none of the Trust or
their Subsidiaries will distribute any offering material in connection with the
Exempt Resales.
(k) Each of the Issuers will use its reasonable best efforts
to cause the Notes to be eligible for trading on the PORTAL Market.
(l) From and after the Closing Date, so long as any of the
Notes are outstanding and are "restricted securities" within the meaning of Rule
144(a) under the Act, and during any period in which any of the Issuers is not
subject to Section 13 or
7
8
15(d) of the Exchange Act, the Issuers will make available to holders of the
Notes and prospective purchasers of Notes designated by such holders, upon
request of such holders or such prospective purchasers, the information required
to be delivered pursuant to Rule 144A (d) (4) under the Act to permit compliance
with Rule 144A in connection with resale of the Notes.
(m) Each of the Issuers agrees that it will not and will
cause its affiliates not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act) in a
transaction that would be integrated with the sale of the Notes in a manner that
would require the registration under the Act of the sale to the Initial
Purchasers or the Eligible Purchasers of the Notes.
(n) Except following the effectiveness of any Registration
Statement (as defined in the Registration Rights Agreement) and except for such
offers as may be made as a result of, or subsequent to, filing such Registration
Statement(s) or amendments thereto prior to the effectiveness thereof, none of
the Issuers and its affiliates will solicit any offer to buy or offer or sell
the Notes by means of any form of general solicitation or general advertising
(within the meaning of Regulation D under the Act).
(o) During the period from the Closing Date to the earlier of
(i) the effectiveness of a registration statement with respect to all the Notes
then outstanding or (ii) two years after the Closing Date, the Issuers will not,
and will not permit any "affiliate" (as defined in Rule 144 under the Act) of
the Issuers to, resell any of the Notes that have been reacquired by them,
except for Notes purchased by the Issuers or any of their affiliates and resold
in a transaction registered under the Act.
(p) Each of the Issuers agrees to comply with all the terms
and conditions of the Registration Rights Agreement and all agreements set forth
in the representation letter of the Issuers to DTC relating to the approval of
the Notes by DTC for "book entry" transfer.
(q) Each of the Issuers agrees that in connection with the
registration of the Notes pursuant to the Registration Rights Agreement, or at
such earlier time as may be required, they will use their best efforts to have
each Indenture qualified under the Trust Indenture Act of 1939, as amended (the
"1939 Act") and any necessary supplemental indentures will be entered into in
connection therewith.
(r) Prior to the Closing Date, the Issuers will furnish to
the Initial Purchasers, as soon as they have been prepared, a copy of any
unaudited interim consolidated financial statements of the Issuers and Peguform
for any period subsequent to the period covered by the most recent consolidated
financial statements of the Issuers and Peguform appearing in the Offering
Memorandum.
(s) The Issuers will not claim the benefit of any usury laws
against any holders of the Notes.
(t) The Acquisition will be consummated on the Closing Date
by the parties to the Acquisition Agreements (as defined) as described in the
Offering
8
9
Memorandum.
(u) Promptly following the Closing Date, the Trust will
contribute all or substantially all of its assets to Venture Holdings Company
LLC, a Michigan limited liability company and wholly-owned subsidiary of the
Trust, in compliance with the terms of the Indentures and the indenture
governing the Trust's 9 1/2% Senior Notes dated as of July 1, 1997 among the
Trust, certain of the Guarantors and the Trustee (the "1997 Indenture") and
Venture Holdings Company LLC shall become the successor to the Trust under the
Indentures and the 1997 Indenture and the Trust shall be released from its
obligations under the Indentures and the 1997 Indenture, in accordance with the
respective terms thereof.
5. REPRESENTATIONS AND WARRANTIES OF THE ISSUERS. Each of the Issuers
represents and warrants to the Initial Purchasers that:
(a) The Preliminary Offering Memorandum and Offering
Memorandum with respect to the Notes have been prepared by the Issuers for use
by the Initial Purchasers in connection with the Exempt Resales. No order or
decree preventing the use of the Preliminary Offering Memorandum or the Offering
Memorandum or any amendment or supplement thereto, or any order asserting that
the transactions contemplated by this Agreement are subject to the registration
requirements of the Act has been issued and no proceeding for that purpose has
commenced or is pending or, to the knowledge of the Issuers, is contemplated.
(b) The Preliminary Offering Memorandum and the Offering
Memorandum as of their respective dates do not, and the Offering Memorandum as
of the Closing Date will not, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, except that this representation and warranty does not
apply to statements in or omissions from the Preliminary Offering Memorandum or
the Offering Memorandum made in reliance upon and in conformity with information
relating to the Initial Purchasers furnished to the Issuers in writing by or on
behalf of the Initial Purchasers expressly for use therein.
(c) Each Indenture has been duly and validly authorized by
each of the Issuers and, upon its execution and delivery by each of the Issuers
and assuming due authorization, execution, delivery and performance by the
Trustee, will be a valid and binding agreement of each of the Issuers,
enforceable in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other similar laws affecting creditors'
right generally and limits imposed by equitable principles, and conforms in all
material respects to the description thereof in the Offering Memorandum; no
qualification of either Indenture under the 1939 Act is required in connection
with the offer and sale of the Notes contemplated hereby or in connection
9
10
with the Exempt Resales.
(d) The Notes have been duly authorized by the Trust and the
Subsidiary Guarantees have been authorized by each of the Guarantors and when
the Notes are executed by the Trust and the Subsidiary Guarantees are executed
by each of the Guarantors and such Notes and Subsidiary Guarantees are
authenticated by the Trustee in accordance with the appropriate Indenture and
the Notes and Subsidiary Guarantees are delivered to the Initial Purchasers
against payment therefor in accordance with the terms hereof, the Notes will
have been validly issued and delivered, and will constitute a valid and binding
obligation of the Trust and the Subsidiary Guarantees will have been validly
issued and delivered, and will constitute valid and binding obligations of each
of the Guarantors and the Notes and Subsidiary Guarantees shall be entitled to
the benefits of the appropriate Indenture and enforceable in accordance with
their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other similar laws affecting the enforcement of creditors' rights
generally and limits imposed by equitable principles, and the Notes and
Subsidiary Guarantees will conform in all material respects to the descriptions
thereof in the Offering Memorandum.
(e) All the outstanding shares of capital stock or membership
interests, as appropriate, of each Subsidiary have been duly authorized and
validly issued and are fully paid and nonassessable.
(f) Each Subsidiary that is a corporation has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and each Subsidiary that is a limited
liability company is a limited liability corporation duly formed and validly
existing under the laws of its jurisdiction of formation; the Trust is a validly
existing grantor trust under the laws of Michigan; the Trust has no subsidiaries
other than the Trust Subsidiaries and each such Trust Subsidiary is owned by the
Trust directly or indirectly, through one or more of the Trust Subsidiaries,
free and clear of any lien, adverse claim, security interest, equity or other
encumbrance, other than pursuant to the New Credit Facility; Peguform has no
material subsidiaries other than the Peguform Subsidiaries and each such
subsidiary is owned by Peguform directly or indirectly, through one or more of
the Peguform Subsidiaries, free and clear of any lien, adverse claim, security
interest, equity or other encumbrance, other than pursuant to the New Credit
Facility. Each Subsidiary has the corporate or limited liability company, as
appropriate, power and authority, and the Trust has all necessary power and
authority, to carry on its business as described in the Offering Memorandum and
to own, lease and operate its properties; each Subsidiary is duly qualified and
in good standing as a foreign corporation or limited liability company, as
appropriate, authorized to do business in each jurisdiction or place where the
nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure to so register or
qualify does not have, individually or in the aggregate, a material adverse
effect on the condition (financial or other), business,
10
11
prospects, properties, net worth or results of operations of the Trust and the
Subsidiaries taken as a whole (a "Material Adverse Effect"). The Trust is not
required to register or qualify as a foreign entity in any jurisdiction.
(g) There are no legal or governmental proceedings pending
or, to the knowledge of the Issuers, threatened, against the Trust or any of the
Subsidiaries or to which the Trust or any of the Subsidiaries or to which any of
their respective properties, is subject, that are not disclosed in the Offering
Memorandum which would cause a Material Adverse Effect or materially affect the
issuance of the Notes or the consummation of the transactions contemplated by
this Agreement. There are no material obligations of the Trust or the
Subsidiaries by way of agreements, contracts, indentures, leases or other
instruments that are not described in the Offering Memorandum other than
specific purchase orders, agreements and contracts with customers in the
ordinary course of business. Other than as described in the Preliminary Offering
Memorandum and the Offering Memorandum, none of the Trust or the Subsidiaries is
involved in any strike, job action or labor dispute with any group of employees,
which, singly or in the aggregate would have a Material Adverse Effect and, to
the Issuers' knowledge, no such action or dispute is threatened.
(h) None of the Trust or the Subsidiaries is (A) in violation
of its certificate or articles of incorporation, or bylaws or other
organizational documents, or of any law, ordinance, administrative or
governmental rule or regulation applicable to the Trust or any of the
Subsidiaries or of any decree of any court or governmental agency or body having
jurisdiction over the Trust or any of the Subsidiaries or (B) in default in the
performance of any obligation, agreement or condition contained in any bond,
debenture, note or any other evidence of indebtedness or in any material
agreement, indenture, lease or other instrument to which the Trust or any of the
Subsidiaries is a party or by which any of them or any of their respective
properties may be bound, except to the extent any such violation or default, in
the case of (A) or (B), as does not or will not have a Material Adverse Effect.
(i) None of the issuance, offer, sale or delivery of the
Notes and Subsidiary Guarantees, the execution, delivery or performance of this
Agreement, the Indentures or the Registration Rights Agreement by the Issuers or
the consummation by the Trust or the Subsidiaries of the transactions
contemplated hereby or thereby (including, without limitation, the Acquisition)
(A) requires any consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency or official (except such as may be required
in connection with the registration under the Act of the Notes and the
Subsidiary Guarantees and qualification of the Indentures under the 1939 Act in
accordance with the Registration Rights Agreement and compliance with the
securities or Blue Sky laws of various jurisdictions), or conflicts or will
conflict with or constitutes or will constitute a
11
12
breach of, or a default under, the certificate or articles of incorporation,
bylaws or other organizational documents, of the Trust or any of the
Subsidiaries, (B) conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, any agreement, indenture, lease or
other instrument to which the Trust or any of the Subsidiaries is a party or by
which any of them or any of their respective properties may be bound, (C)
violates or will violate in any material respect any statute, law, regulation or
filing or judgment, injunction, order or decree applicable to the Trust or any
of the Subsidiaries or any of their respective properties, or (D) will result in
the creation or imposition of any lien, charge or encumbrance ("Lien") upon any
property or assets of the Trust or any of the Subsidiaries pursuant to the terms
of any agreement or instrument to which any of them is a party or by which any
of them may be bound or to which any of the property or assets of any of them is
subject.
(j) The accountants, Deloitte & Touche LLP, who have
certified or shall certify the financial statements of the Trust and its
consolidated subsidiaries included as part of the Offering Memorandum (or any
amendment or supplement thereto), are independent certified public accountants
with respect to each of the Issuers within the meaning of Regulation S-X under
the Act.
(k) The accountants, BDO International GmbH who have
certified or shall certify the financial statements of Peguform and its
consolidated subsidiaries included as part of the Offering Memorandum (or any
amendment or supplement thereto), are independent certified public accountants
with respect to Peguform and its subsidiaries within the meaning of Regulation
S-X under the Act.
(l) The historical consolidated financial statements,
together with related schedules and notes included in the Offering Memorandum,
present fairly in all material respects the consolidated financial position,
results of operations and changes in trust principal or stockholders' equity, as
the case may be, and cash flows of the Issuers and Peguform, as appropriate, at
the respective dates or for the respective periods to which they apply; and such
statements and related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein. The pro forma financial
statements and other pro forma information included in the Offering Memorandum
present fairly, in all material respects, the information shown therein, comply
as to form in all material respects with Regulation S-X (except with respect to
the calculation of EBITDA and Adjusted EBITDA) and have been properly compiled
on the pro forma bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances referred to
therein. The other financial and statistical information and data included in
the Offering Memorandum (and any amendment or supplement thereto) is accurately
presented and, to the extent such information and data is derived from the
financial books and records of the Issuers or Peguform, is prepared on a basis
consistent with such financial statements and the
12
13
books and records of the Issuers or Peguform.
(m) Each of the Subsidiaries that is party to the New Credit
Facility (as defined in the Offering Memorandum) has all requisite corporate or
limited liability company power and authority and the Trust has the power and
authority to enter into the New Credit Facility, and any and all other
agreements and instruments ancillary to or entered into in connection with the
transactions contemplated by such New Credit Facility. The New Credit Facility
and any and all other agreements and instruments ancillary to or entered into in
connection with the transaction contemplated by such New Credit Facility have
been duly authorized by each of the Trust and Subsidiaries party thereto.
(n) Each Guarantor has all requisite corporate or limited
liability company power, as applicable, and authority and the Trust has the
power and authority to execute, deliver and perform its obligations under this
Agreement and the Registration Rights Agreement; the execution and delivery of,
and the performance by each of the Issuers of their obligations under, this
Agreement and the Registration Rights Agreement have been duly and validly
authorized by each of the Issuers and this Agreement has been and on the Closing
Date the Registration Rights Agreement will be duly executed and delivered by
each of the Issuers. This Agreement constitutes and the Registration Rights
Agreement will constitute valid and legally binding agreements of each of the
Issuers enforceable against each of the Issuers in accordance with their terms,
except as the enforcement hereof and thereof may be limited by bankruptcy,
insolvency or other similar laws affecting the enforcement or creditors' rights
generally and subject to the applicability of general principles of equity, and
except as rights to indemnity and contribution hereunder and thereunder may be
limited by Federal or state securities laws or principles of public policy.
(o) Klockner Mercator Maschinenbau GmbH and Venture
Beteiligungs GmbH, each have all requisite corporate power and authority and the
Trust has the power and authority to enter into the Share Purchase and Transfer
Agreement dated Xxxxx 0, 0000 xxx Xxxxxxx Xxxxxxxxxxx-xxx Treuhand-Gesellschaft
mbH, Koln and Venture Verwaltungs GmbH each have all requisite corporate power
and authority and the Trust has power and authority to enter into the Share
Purchase and Transfer Agreement dated March 8, 1999 (collectively, the
"Acquisition Agreements") and any and all other agreements and/or side letters
ancillary to or entered into in connection with the transactions contemplated by
the Acquisition Agreements and to consummate the transactions contemplated
thereby.
(p)(i) The Acquisition Agreements have been duly and validly
authorized, executed and delivered by the parties thereto and constitute the
valid and binding agreement of the parties thereto, enforceable against each of
them in accordance with its terms, except as the enforcement thereof may be
limited by
13
14
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally,
general equitable principles (whether considered in a proceeding in equity or at
law) and (ii) all representations and warranties made by the parties to the
Acquisition Agreements are true and correct in all material respects as of the
date hereof. All foreign and domestic regulatory approvals necessary for
consummation of the transactions contemplated by the Acquisition Agreements have
been obtained.
(q) Except as disclosed in the Offering Memorandum, subsequent
to the date as of which such information is given in the Offering Memorandum,
none of the Trust or any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Trust and the Subsidiaries
taken as a whole, and there has not been any material change in the capital
stock, or material increase in the short-term or long-term debt, of any of the
Trust or the Subsidiaries or any material adverse change, or any development
involving or which could reasonably be expected to involve a prospective
material adverse change, in the condition (financial or other), business,
properties, net worth or results of operations of the Trust and the Subsidiaries
taken as a whole.
(r) Each of the Trust and the Subsidiaries has good and
marketable title to all real property and good title to all material personal
property described in the Offering Memorandum as being owned by it, free and
clear of all liens, claims, security interests or other encumbrances except such
as are described in the Offering Memorandum or such as would not have a Material
Adverse Effect and all the property described in the Offering Memorandum as
being held under lease or usage agreement by each of the Trust and the
Subsidiaries is held by it under valid, subsisting and enforceable leases and
usage agreements, with only such exceptions as in the aggregate would not have a
Material Adverse Effect.
(s) The Trust and the Subsidiaries have not distributed and,
prior to the later to occur of the Closing Date and completion of the
distribution of the Notes, will not distribute any offering material in
connection with the offering and sale of the Notes other than the Preliminary
Offering Memorandum and Offering Memorandum.
(t) Each of the Trust and the Subsidiaries has such permits,
licenses, franchises, and other approvals or authorizations of governmental or
regulatory authorities ("Permits") as are necessary to own their respective
properties and to conduct their respective businesses in the manner described in
the Offering Memorandum, except such Permits that the failure to possess would
not have a Material Adverse Effect; each of the Trust and the Subsidiaries have
fulfilled and performed all their respective material obligations with respect
to the Permits, except to the extent such failure to perform would not have a
Material Adverse Effect and no event has occurred which allows, or after notice
or lapse of time would allow, revocation or termination thereof or results in
any other material impairment of the rights of the
14
15
holder of any such Permit, subject in each case to such qualification as may be
set forth in the Offering Memorandum; and, except as described in the Offering
Memorandum, none of the Permits contains any restriction that is materially
burdensome to the Trust and the Subsidiaries, taken as a whole.
(u) Each of the Trust and Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with applicable generally
accepted accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(v) None of the Trust or the Subsidiaries or, to the Issuers'
knowledge, any employee or agent of the Trust or any Subsidiary has made any
payment of funds of the Trust or any Subsidiary or received or retained any
funds in violation of any law, rule or regulation, which violation would have a
Material Adverse Effect.
(w) No holder of any security of the Issuers, other than the
Notes, has any right to request or demand registration of such security because
of the consummation of the transactions contemplated by this Agreement or the
Registration Rights Agreement.
(x) Each of the Trust and the Subsidiaries owns or possesses
the right to use all patents, trademarks, trademark registrations, service
marks, service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets and rights described in the Offering Memorandum as
being owned by any of them or necessary for the conduct of their respective
businesses, and none of the Issuers is aware of any claim to the contrary or any
challenge by any other person to the rights of the Trust and the Subsidiaries
with respect to the foregoing, except for any such claim or challenge that would
not have a Material Adverse Effect.
(y) Each of the Issuers is not and, upon sale of the Notes to
be issued and sold thereby in accordance herewith and the application of the net
proceeds to the Issuers of such sale as described in the Offering Memorandum
under the caption "Use of Proceeds," will not be an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
(z) When the Notes are issued and delivered pursuant to this
Agreement, such Notes will not be of the same class (within the meaning of Rule
144A (d)(3) under the Act) as any security of the Issuers that is listed on a
national securities exchange registered under Section 6 of the Exchange Act or
that is quoted in a United States automated interdealer quotation system.
15
16
(aa) None of the Issuers or any affiliate (as defined in Rule
501(b) of Regulation D ("Regulation D") under the Act) of them has directly, or
through any agent (provided that no representation is made as to the Initial
Purchasers or any person acting on their behalf), (i) sold, offered for sale,
solicited offers to buy or otherwise negotiated in respect of, any security (as
defined in the Act) which is or will be integrated with the offering and sale of
the Notes in a manner that would require the registration of the Notes under the
Act, or (ii) engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with the offering of the
Notes.
(bb) Assuming (i) that the representations and warranties in
Section 2 hereof are true, (ii) the Initial Purchasers comply with the covenants
set forth in Section 2 hereof, and (iii) that each person to whom the Initial
Purchasers offer, sell or deliver the Notes is a Qualified Institutional Buyer
or a person permitted to purchase the Notes in an offshore transaction in
reliance on Regulation S under the Act, the purchase and sale of the Notes
pursuant hereto (including the Initial Purchasers' proposed offering of the
Notes on the terms and in the manner set forth in the Offering Memorandum and
Section 2 hereof) is exempt from the registration requirements of the Act and
the Indentures are not required to be qualified under the 1939 Act.
(cc) The execution and delivery of this Agreement, the
Registration Rights Agreement and Indentures and the sale of the Notes to the
Initial Purchasers or by the Initial Purchasers to Eligible Purchasers will not
involve any prohibited transaction within the meaning of Section 406 of ERISA or
Section 4975 of the Code. The representation made by the Issuers in the
preceding sentence is made in reliance upon and subject to the accuracy of, and
compliance with, the representations and covenants made or deemed made by the
Eligible Purchasers as set forth in the Offering Memorandum under the section
entitled "Notice to Investors."
(dd) Except as described in the Offering Memorandum or as
would not, singularly or in the aggregate, have a Material Adverse Effect on the
Trust and the Subsidiaries or otherwise require disclosure in a registration
statement filed under the Act, (i) none of the Trust or any of the Subsidiaries
is in violation of any federal, state or local laws and regulations relating to
pollution or protection of human health or the environment, including, without
limitation, laws and regulations relating to emissions, discharges, releases or
threatened releases of toxic or hazardous substances, materials or wastes, or
petroleum and petroleum products ("Materials of Environmental Concern"), or
otherwise relating to the protection of human health and safety, or the use,
treatment, storage, disposal, transport or handling of Materials of
Environmental Concern (collectively, "Environmental Laws"), which violation
includes, but is not limited to, noncompliance with, or lack of, any permits or
other environmental authorizations, and (ii) (A) none of the Trust or any of the
Subsidiaries has received any communication (written or oral), whether from a
governmental authority or otherwise, alleging any such violation or
noncompliance, and there are no circumstances, either
16
17
past, present or that are reasonably foreseeable, that may lead to any such
violation in the future, (B) there is no pending or threatened claim, action,
investigation or notice (written or oral) by any person or entity alleging
potential liability for investigatory, cleanup, or response costs, or natural
resources or property damages, or personal injuries, attorney's fees or
penalties relating to (x) the presence, or release into the environment, of any
Materials of Environmental Concern, or (y) circumstances forming the basis of
any violation or potential violation, of any Environmental Law (collectively,
"Environmental Claims"), and (C) there are no past or present actions,
activities, circumstances, conditions, events or incidents that could form the
basis of any Environmental Claim against the Trust or any of the Subsidiaries or
against any person or entity for whose acts or omissions the Trust or any of the
Subsidiaries is or may reasonably be expected to be liable, either contractually
or by operation of law. In the ordinary course of business, the Trust and each
of the Subsidiaries, as appropriate, (i) conduct a periodic review of the effect
of Environmental Laws on the business, operations and properties of the Trust
and each of the Subsidiaries, in the course of which, or as a result of which,
the Trust or any of the Subsidiaries have used their best efforts to identify
and evaluate associated costs and liabilities (including, without limitation,
any capital or operating expenditures required for cleanup, closure of
properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities, and any potential
liabilities to third parties), and (ii) have conducted environmental
investigations of, and have reviewed reasonably available information regarding,
the business, properties and operations of the Trust and each of the
Subsidiaries, and of other properties within the vicinity of their business,
properties and operations, as appropriate for the circumstances of each such
property and operation; on the basis of such reviews, investigations and
inquiries, the Issuers have reasonably concluded that, except as disclosed in
the Offering Memorandum, any costs and liabilities associated with such matters
would not have, singularly or in the aggregate, a Material Adverse Effect on the
Trust and the Subsidiaries, taken as a whole, or would otherwise require
disclosure in a registration statement filed under the Act.
(ee) Each of the Trust and, as applicable, the Subsidiaries
has filed all federal, state, local and foreign income or other tax returns
which have been required to be filed and has paid all taxes indicated by said
returns to be due and all assessments received by them or any of them to the
extent such taxes have become due other than those contested in good faith by
appropriate proceedings diligently conducted (with proper reserves in accordance
with generally accepted accounting principles for any such taxes being so
contested). To the best knowledge of each Issuer, the charges, accruals and
reserves on the books of the Trust and the Subsidiaries in respect of any tax
liability for any years not finally determined are adequate to meet any
assessments
17
18
or reassessments for additional tax for any years not finally determined, except
as disclosed in the Offering Memorandum and except to the extent of any
inadequacy that would not have a Material Adverse Effect. At all times from
January 1, 1988, the Trust was a grantor trust described in Section
1361(c)(2)(A)(i) of the Internal Revenue Code of 1986, as amended (the "Code"),
and any predecessor provision, for federal income tax purposes, and each other
Issuer (other than Venture Holdings Corporation) was an S corporation, within
the meaning of Section 1361 of the Code, for federal income tax purposes, except
that Venture Industries Corporation became an S corporation on February 1, 1989,
Venture Service Company became an S corporation on January 1, 1992, Venture
Leasing Company, Inc. became an S Corporation on February 1, 1988 and Vemco
Leasing, Inc. became an S corporation on February 15, 1988 and Experience
Management LLC is taxed as a partnership for tax purposes and Venture Holdings
Company LLC is a pass-through entity for tax purposes. Each subsidiary of
Peguform identified on Schedule B hereto is incorporated in the jurisdiction
identified on Schedule B hereto. Each corporation which has been merged into any
Issuer prior to the Closing Date except Xxxxxx Corporation and its subsidiaries,
was at all times prior thereto an S corporation, as defined in Section 1361 of
the Code, for federal income tax purposes. Each Issuer and each corporation
which was merged into any Issuer was either a grantor trust, within the meaning
of Section 1361(c)(2)(A)(i) of the Code and any predecessor provision; an S
corporation, within the meaning of Section 1361 of the Code and any predecessor
provision; or was granted a similar tax status under a state and local tax law,
for state and local tax purposes in each state and local jurisdiction in which
such corporation filed a return claiming the benefits of a grantor trust, an S
corporation, or such similar tax status. Venture Holdings Corporation has not
participated in any transaction to which Code Section 381 applies.
(ff) No labor dispute with the employees of the Trust and the
Subsidiaries exists or is threatened or imminent that would have a Material
Adverse Effect.
(gg) On the Closing Date, the Corporate Opportunity Agreement
will be duly executed and delivered by Xxxxx X. Xxxxxx and constitutes a valid
and binding agreement of Xxxxx X. Xxxxxx, enforceable in accordance with its
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency other similar laws now or hereafter affecting creditors' rights
generally and subject to the applicability of general principles of equity.
(hh) The execution, delivery and performance of the Corporate
Opportunity Agreement by Xxxxx X. Xxxxxx and the compliance by Xxxxx X. Xxxxxx
with all of the provisions thereof (A) will not, under laws and regulations
currently in effect or with currently known future effective dates, require any
consent, approval, authorization or other order of any federal, state, foreign
or other court, regulatory body, administrative agency or other governmental
body or authority or, if so required, all such consents, approvals,
authorizations and orders have been obtained and are in full
18
19
force and effect, (B) will not conflict with or constitute a breach of any of
the terms or provisions of, or a default under, any material agreement,
indenture or other instrument to which Xxxxx X. Xxxxxx or any affiliate of Xxxxx
X. Xxxxxx is a party or by which Xxxxx X. Xxxxxx or any affiliate of Xxxxx X.
Xxxxxx is a party or by which Xxxxx X. Xxxxxx or any affiliate of Xxxxx X.
Xxxxxx or any of their respective assets or property is bound or (C) will not
violate or conflict with any laws, administrative regulations or rulings or
court decrees applicable to Xxxxx X. Xxxxxx, any of his affiliates or their
respective property.
(ii) Each of the Trust and the Subsidiaries has in effect with
insurers of recognized financial responsibility insurance against such losses
and risks and in amounts the Issuers reasonably believe are adequate in light of
the business conducted by the Trust and the Subsidiaries and the properties
owned by them.
(jj) The Trust (on a consolidated basis) is, and immediately
after the Closing Date and the application of the proceeds of the offering of
the Notes as described under the caption "Use of Proceeds" in the Offering
Memorandum will be, Solvent. As used herein, the term "Solvent" means, with
respect to the Trust (on a consolidated basis) on a particular date, that on
such date (i) the fair market value of its assets is greater than the total
amount of its liabilities (including contingent liabilities), (ii) the present
fair salable value of its assets is greater than the amount that will be
required to pay its probable liabilities on its debts as they become absolute
and matured, (iii) it is able to realize upon its assets and pay its debts and
other liabilities, including contingent obligations, as they mature and (iv) it
does not have unreasonably small capital.
(kk) None of the Issuers nor any of their respective
affiliates or any person acting on its or their behalf (other than the Initial
Purchasers, as to whom the Issuers make no representation) has engaged or will
engage in any directed selling efforts within the meaning of Regulation S under
the Act ("Regulation S") with respect to the Notes or the Subsidiary Guarantees.
(ll) Assuming the Initial Purchasers comply with the covenants
set forth in Section 2 above:
(i) the Notes offered and sole in reliance on
Regulation S have been and will be offered and sold only in offshore
transactions; and
(ii) the Issuers and all persons acting on their behalf
(other than the Initial Purchasers, as to whom the Issuers make no
representation) have complied with and will comply with the offering
restrictions requirements of Regulation S in connection with the offering of the
Notes outside the United States and, in connection therewith, the Offering
Memorandum will contain the disclosure required by Rule 902(g)(2).
(mm) The sale of Notes pursuant to Regulation S is not part of
a plan or scheme to evade the registration provisions of the Act.
(nn) Each of the Issuers is a "reporting issuer," as defined
in Rule 902
19
20
under the Act.
(oo) On the Closing Date, the New Notes (as defined in the
Registration Rights Agreement) will have been duly authorized by the Trust. When
the New Notes are issued, executed and authenticated in accordance with the
terms of the Exchange Offer (as defined in the Registration Rights Agreement)
and the Indentures, the New Notes and Subsidiary Guarantees thereto will be
entitled to the benefits of the appropriate Indenture and will be the valid and
binding obligations of the Trust and the Guarantors, as applicable, enforceable
against the Trust and the Guarantors, as applicable, in accordance with their
terms, except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
6. INDEMNIFICATION AND CONTRIBUTION. (a) Each of the Issuers, jointly
and severally, agrees to indemnify and hold harmless the Initial Purchasers and
each person, if any, who controls the Initial Purchasers within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, and the agents,
employees, officers and directors of the Initial Purchasers, from and against
any and all losses, claims, damages, liabilities and expenses (including
reasonable costs of investigation) arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum or Offering Memorandum or in any amendment or
supplement thereto, or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages, liabilities or expenses arise out of or are based upon
any untrue statement or omission or alleged untrue statement or omission which
has been made therein or omitted therefrom in reliance upon and in conformity
with the information furnished in writing to the Issuers by or on behalf of the
Initial Purchasers expressly for use in connection therewith, provided, however,
that the indemnification contained in this paragraph (a) with respect to the
Preliminary Offering Memorandum shall not inure to the benefit of the Initial
Purchasers (or to the benefit of any person controlling the Initial Purchasers)
on account of any such loss, claim, damage, liability or expense arising from
the sale of the Notes by the Initial Purchasers to any person if the untrue
statement or alleged untrue statement or omission or alleged omission of a
material fact contained in the Preliminary Offering Memorandum was corrected in
the Offering Memorandum and the Initial Purchasers sold Notes to that person
without sending or giving at or prior to the written confirmation of such sale,
a copy of the Offering Memorandum if the Issuer has previously furnished
sufficient copies thereof to the Initial Purchasers on a timely basis to permit
such sending or giving. The foregoing indemnity agreement shall be in addition
to any liability which the Issuers may otherwise have.
20
21
(b) If any action, suit or proceeding shall be brought against
the Initial Purchasers or any person controlling such Initial Purchasers in
respect of which indemnity may be sought against the Issuers, the Initial
Purchasers or such controlling person shall promptly notify in writing the
parties against whom indemnification is being sought (the "indemnifying
parties"), and such indemnifying parties shall assume the defense thereof,
including the employment of counsel and payment of all fees and expenses. The
Initial Purchasers or any such controlling person shall have the right to employ
separate counsel in any such action, suit or proceeding and to participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of the Initial Purchasers or such controlling person unless (i) the
indemnifying parties have agreed in writing to pay such fees and expenses, (ii)
the indemnifying parties have failed to assume the defense and employ counsel,
or (iii) the named parties to any such action, suit or proceeding (including any
impleaded parties) include both the Initial Purchasers or such controlling
person and the indemnifying parties and the Initial Purchasers or such
controlling person shall have been advised by its counsel that representation of
such indemnified party and any indemnifying party by the same counsel would be
inappropriate under applicable standards of professional conduct (whether or not
such representation by the same counsel has been proposed) due to actual or
potential material differing interests between them (in which case the
indemnifying party shall not have the right to assume the defense of such
action, suit or proceeding on behalf of the Initial Purchasers or such
controlling person). It is understood, however, that the indemnifying parties
shall, in connection with any one such action, suit or proceeding or separate
but substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of only one separate firm of attorneys (in
addition to any local counsel) at any time for the Initial Purchasers and
controlling persons not having actual or potential material differing interests
with the Initial Purchasers or among themselves, which firm shall be designated
in writing by Banc One Capital Markets, Inc., and that all such fees and
expenses shall be reimbursed on a monthly basis. The indemnifying parties shall
not be liable for any settlement of any such action, suit or proceeding effected
without their written consent (which consent will not be unreasonably withheld),
but if settled with such written consent, or if there be a final unappealable
judgment for the plaintiff in any such action, suit or proceeding, the
indemnifying parties agree to indemnify and hold harmless the Initial Purchasers
and any such controlling person, to the extent provided in paragraph (a), from
and against any loss, claim, damage, liability or expense by reason of such
settlement or judgment.
(c) The Initial Purchasers severally agree to indemnify and
hold harmless the Issuers and their trustees, special advisors, beneficiaries,
directors and officers, and each person who controls the Issuers within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act to the same
extent as the indemnity from the Issuers to the Initial Purchasers set forth in
paragraph (a) hereof, but only with respect to information furnished in writing
by or on behalf of the Initial Purchasers expressly for use in the Preliminary
Offering Memorandum or Offering Memorandum or any amendment or supplement
thereto. If any action, suit or proceeding shall be brought against any of the
Issuers and any of its trustees, special advisors, beneficiaries, directors or
officers, or any such controlling person based on the Preliminary Offering
Memorandum or Offering Memorandum, or any amendment or supplement thereto, and
in respect of which indemnity may be sought against the Initial Purchasers
pursuant to this paragraph (c), the Initial Purchasers shall have the rights and
duties given to the Issuers by paragraph (b) above (except that if the Issuers
shall have assumed the
21
22
defense thereof the Initial Purchasers shall not be required to do so, but may
employ separate counsel therein and participate in the defense thereof, but the
fees and expenses of such counsel shall be at the Initial Purchasers' expense),
and the Issuers, their directors and officers, and any such controlling person
shall have the rights and duties given to the Initial Purchasers by paragraph
(b) above. The foregoing indemnity agreement shall be in addition to any
liability which the Initial Purchasers may otherwise have.
(d) If the indemnification provided for in this Section 6 is
unavailable to or is insufficient to hold harmless an indemnified party under
paragraphs (a) or (c) hereof in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then an indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Issuers on the one hand and the Initial
Purchasers on the other hand from the offering of the Notes, or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Issuers on
the one hand and the Initial Purchasers on the other in connection with the
statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Issuers on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Issuers bear to the total underwriting discounts and commissions received by the
Initial Purchasers. The relative fault of the Issuers on the one hand and the
Initial Purchasers on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
Issuers on the one hand or by the Initial Purchasers on the other hand and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(e) The Issuers and the Initial Purchasers agree that it would
not be just and equitable if contribution pursuant to this Section 6 were
determined by a pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in paragraph (d)
above. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities and expenses referred to in paragraph (d)
above shall be deemed to include, subject to the limitation set forth above, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of the immediately preceding
paragraphs (c) or (d), the Initial Purchasers shall not be required to
contribute any amount in excess
22
23
of the amount by which the total discounts and commissions received by such
Initial Purchaser exceeds the amount of any damages which such Initial Purchaser
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11 (f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers' obligations to contribute pursuant to
this Section 6(e) are several in proportion to the respective principal amount
of the Notes purchased by each of the Initial Purchasers hereunder and not
joint.
(f) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 6 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 6 and the
respective representations and warranties of the Issuers and the Initial
Purchasers set forth in this Agreement shall remain operative and in full force
and effect, regardless of (i) any investigation made by or on behalf of the
Initial Purchasers or any persons controlling the Initial Purchasers, the
Issuers, their directors or officers or any person controlling the Issuers, (ii)
acceptance of any Notes and payment therefore hereunder, and (iii) any
termination of this Agreement. A successor to the Initial Purchasers or any
person controlling the Initial Purchasers, or to the Issuers, or their directors
or officers or any person controlling the Issuers shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 6.
(g) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding and does not include a statement as
to, or an admission of, fault, culpability or a failure to act, by or on behalf
of any indemnified party.
7. CONDITIONS OF THE INITIAL PURCHASERS' OBLIGATIONS. The obligations
of the Initial Purchasers to purchase the Notes are subject to the following
conditions:
(a) At the time of execution of this Agreement and on the
Closing Date, no order or decree preventing the use of the Offering Memorandum
or any amendment or supplement thereto, or any order asserting that the
transactions contemplated by the Agreement are subject to the registration
requirements of the Act shall have been issued and no proceedings for that
purpose shall have been commenced or shall be pending or, to the knowledge of
the Issuers, be contemplated. No stop order
23
24
suspending the sale of the Notes in any jurisdiction designated by the Initial
Purchasers shall have been issued and no proceedings for that purpose shall have
been commenced or shall be pending or, to the knowledge of the Issuers, shall be
contemplated.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, properties, net worth, or results of operations of the Trust or the
Subsidiaries not contemplated by the Offering Memorandum, which in the opinion
of the Initial Purchasers, would materially adversely affect the market for the
Notes, or (ii) any event or development relating to or involving the Trust or
the Subsidiaries or any officer or director of any of them which makes any
statement of material fact made in the Offering Memorandum untrue or which, in
the opinion of the Issuers and their counsel or the Initial Purchasers and their
counsel, requires the making of any addition to or change in the Offering
Memorandum in order to state a material fact required by any law to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, if amending or
supplementing the Offering Memorandum to reflect such event or development
would, in the opinion of the Initial Purchasers, materially adversely affect the
market for the Notes.
(c) Prior to or substantially simultaneously with the Closing
Date, the Issuers (x) shall have received the proceeds of the Indebtedness
incurred under the New Credit Facility, as described in the Offering Memorandum,
and (y) with respect to the Acquisition Agreements all conditions to such
Acquisition Agreements shall have been completed, satisfied or waived and all
parties to such Acquisition Agreements shall be, in the reasonable judgment of
the Initial Purchasers, prepared to close immediately.
(d) The Initial Purchasers shall have received on the Closing
Date an opinion of Xxxxxx Xxxxxxx PLLC, special counsel for the Issuers dated
the Closing Date and addressed to the Initial Purchasers, to the effect that:
(i) Each of the Guarantors (except Experience Management
LLC ("Experience") and Venture Holdings Company LLC ("VHC")) has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and each of Experience and VHC is a
limited liability company duly formed and validly existing as a limited
liability company in good standing under the laws of Michigan; the Trust is
validly existing as a trust under the laws of Michigan; and each of the
Guarantors (other than Experience and VHC) has the corporate power and
authority, and each of Experience and VHC has the limited liability company
power and authority, and the Trust has the power and authority, to carry on its
business as described in the Offering Memorandum (and any amendment or
supplement thereto) and to own, lease and operate its properties;
(ii) Each of the Guarantors (other than Experience and
VHC) is
24
25
duly qualified and in good standing as a foreign corporation and each of
Experience and VHC is duly qualified and in good standing as a limited liability
company authorized to do business in each jurisdiction listed on a schedule to
such opinion, and the Trust is not required to qualify as a foreign corporation
or trust in any jurisdiction;
(iii) Xxxxx X. Xxxxxx is the sole beneficiary of the
Trust during his lifetime. All of the outstanding shares of capital stock of
each of the Guarantors (other than Experience and VHC) have been duly and
validly authorized and issued and are fully paid and non-assessable and the
ownership interests of each of Experience and VHC have been properly issued, and
to the knowledge of such counsel, except as described in the Offering
Memorandum, all such capital stock and ownership interests are owned directly or
indirectly by the Trust free and clear of any security interest, claim, lien,
encumbrance or adverse interest of any nature, and, to the knowledge of such
counsel, there are no options, warrants or other rights to purchase, agreements
or other obligations to issue or other rights to convert any obligations into
any shares of capital stock or ownership interests in the Guarantors that are
outstanding under any agreement described or specifically referred to in the
Offering Memorandum;
(iv) Each of the Issuers (except the Trust and
Experience and VHC) has the corporate power and authority, and the Trust has the
power and authority and each of Experience and VHC has the limited liability
company authority to enter into this Agreement and the Registration Rights
Agreement and to issue, sell and deliver the Notes and Subsidiary Guarantees, as
appropriate, to be sold by it to the Initial Purchasers as provided herein, and
this Agreement and the Registration Rights Agreement have been duly authorized,
executed and delivered by each of the Issuers and are the valid, legal and
binding agreements of each of the Issuers, enforceable against each of the
Issuers in accordance with their terms, except as (a) the enforceability thereof
may be limited by or subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, arrangement, moratorium, usury or similar laws now or hereafter
affecting creditors' rights generally, (b) rights or remedies (including,
without limitation, acceleration, specific performance and injunctive relief)
may be limited by equitable principles of general applicability (including,
without limitation, standards of materiality, good faith, fair dealing and
reasonableness) whether such principles are considered in a proceeding in equity
or at law, and may be subject to the discretion of the court before which any
proceedings therefor may be brought and (c) as enforcement of rights to
indemnity and contribution thereunder may be limited by Federal or state
securities laws or principles of public policy;
(v) Each of the Indentures has been duly and validly
authorized, executed and delivered by each of the Issuers and, assuming due
authorization, execution and delivery by the Trustee, is a valid and binding
agreement of each of the Issuers enforceable in accordance with its terms,
except as (a) the enforceability
25
26
thereof may be limited by or subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization, arrangement, moratorium, usury or similar laws now
or hereafter affecting creditors' rights generally, and (b) rights or remedies
(including, without limitation, acceleration, specific performance and
injunctive relief) may be limited by equitable principles of general
applicability (including, without limitation, standards of materiality, good
faith, fair dealing and reasonableness) whether such principles are considered
in a proceeding in equity or at law, and may be subject to the discretion of the
court before which any proceedings therefor may be brought. Assuming that the
representations and warranties of the Initial Purchasers contained herein are
true, correct and complete and that the Issuers and the Initial Purchasers
comply with their respective covenants and agreements contained herein, no
qualification of the Indentures under the 1939 Act is required in connection
with the offer and sale of the Notes contemplated hereby or in connection with
the Exempt Resales;
(vi) The Notes and Subsidiary Guarantees have been
duly and validly authorized by the Trust and each of the Guarantors,
respectively, and when executed by the Trust and each of the Guarantors,
respectively, in accordance with the appropriate Indenture and, assuming due
authentication of the Notes by the Trustee in accordance with the terms of the
appropriate Indenture, upon delivery to the Initial Purchasers against payment
therefor in accordance with the terms hereof, such Notes and Subsidiary
Guarantees will have been validly issued and delivered, and will constitute
valid and binding obligations of each of the Trust and the other Issuers,
respectively, enforceable in accordance with their terms and entitled to the
benefits of the appropriate Indenture, except as (a) the enforceability thereof
may be limited by or subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, arrangement, moratorium, usury or similar laws now or hereafter
affecting creditors' rights generally, and (b) rights or remedies (including,
without limitation, acceleration, specific performance and injunctive relief)
may be limited by equitable principles of general applicability (including,
without limitation, standards of materiality, good faith, fair dealing and
reasonableness) whether such principles are considered in a proceeding in equity
or at law, and may be subject to the discretion of the court before which any
proceedings therefor may be brought;
(vii) Neither the offer, sale or delivery of the
Notes and Subsidiary Guarantees, the execution, delivery or performance by each
of the Trust and the Guarantors of this Agreement, the Registration Rights
Agreement or the Indentures, compliance by each of the Trust and the Guarantors
with the provisions hereof or thereof nor consummation by each of the Trust and
Guarantors of the transactions contemplated hereby or thereby (including,
without limitation, in the case of the Trust, the Acquisition Agreements and the
transactions contemplated thereby) conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the certificate
or articles of incorporation, operating agreement, bylaws or certificate of
trust, as the case may be, of the Trust or any of the Guarantors or any
agreement, indenture,
26
27
lease or other instrument to which the Trust or any of the Guarantors is a party
or by which any of them or any of their properties is bound, which agreements
have been identified on a certificate of a responsible officer of the Trust as
all the material agreements to which the Trust or any of the Guarantors are
party or by which any of them or any of their properties are bound, results or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Issuers under such agreements, nor will any
such action result in any violation in any material respect of any existing law,
of any regulation, ruling (assuming compliance with all applicable state
securities and Blue Sky laws), judgment, injunction, order or decree known to
such counsel to be specifically applicable to the Trust or any of the Guarantors
or any of their respective properties;
(viii) No consent, approval, authorization or other
order of, or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official is required
on the part of the Trust for the valid execution and delivery of the Notes or on
the part of the Guarantors for the valid execution and delivery of the
Subsidiary Guarantees to the Initial Purchasers as contemplated by this
Agreement and the Indentures and compliance and performance by each of the
Issuers with the provisions thereof (except such as may be required under
securities or Blue Sky laws of various jurisdictions or as have been obtained);
(ix) To the knowledge of such counsel after
reasonable inquiry of officers of the Trust and the Guarantors, but without any
other independent investigation, (A) other than as described in the Offering
Memorandum (or any supplement thereto), there are no legal or governmental
proceedings pending or threatened against the Trust or the Guarantors, or to
which the Trust or the Guarantors or any of their properties, are subject, which
are not disclosed in the Offering Memorandum and which, would cause a Material
Adverse Effect or would materially affect the issuance of the Notes or the
consummation of the transactions contemplated by this Agreement and (B) there
are no material agreements, contracts, indentures, leases or other instruments,
that are not described in the Offering Memorandum (or any amendment or
supplement thereto) other than specific purchase orders, agreements and
contracts with customers in the ordinary course of business;
(x) The statements contained in the Offering
Memorandum, insofar as they are descriptions of contracts, agreements or other
legal documents, or refer to statements of law or legal conclusions, present
fair summaries of such contracts, agreement, legal documents, statements of law
or legal conclusions;
(xi) Except as described in the Offering Memorandum,
such counsel does not know of any person who has the right, contractual or
otherwise, to cause the Trust to sell or otherwise issue to them, or to permit
them to underwrite the sale of, any of the Notes or the right, as a result of
the consummation of the
27
28
transactions contemplated by this Agreement and the Registration Rights
Agreement, to require registration under the Act of any shares of Common Stock
or other securities of any of the Issuers;
(xii) When the Notes are issued and delivered
pursuant to this Agreement, such Notes will not be of the same class (within the
meaning of Rule 144A(d) (3) under the Act) as any security of the Issuers that
is listed on a national securities exchange registered under Section 6 of the
Exchange Act or that is quoted in a United States automated interdealer
quotation system;
(xiii) Assuming that the representations and
warranties of the Initial Purchasers contained in the Purchase Agreement are
true, correct and complete and that the Issuers and Guarantors and the Initial
Purchasers comply with their respective covenants and agreements contained in
the Purchase Agreement, no registration of the Notes or Subsidiary Guarantees
under the Act is required for the sale of the Notes and Subsidiary Guarantees to
the Initial Purchasers or for the Exempt Resales in the manner contemplated by
the Purchase Agreement and the Offering Memorandum;
(xiv) None of the Issuers are and, after giving
effect to the offering and sale of the Notes and Subsidiary Guarantees and the
application of the net proceeds thereof as described in the Offering Memorandum,
none of the Issuers will be, an "investment company" as such term is defined in
the Investment Company Act of 1940, as amended.
In addition, such counsel shall state that although such
counsel has not undertaken, except as otherwise indicated in their opinion, to
determine independently, and does not assume any responsibility for, the
accuracy, completeness or fairness of the statements contained in the Offering
Memorandum, such counsel has participated in the preparation of the Offering
Memorandum, including review and discussion of the contents thereof, and on the
basis of the foregoing nothing has come to the attention of such counsel that
has caused them to believe that the Offering Memorandum, except as to the
financial statements and the notes thereto and the schedules and other financial
and statistical data included therein as to which no belief is expressed, as of
its date and as of the Closing Date contained an untrue statement of material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading or that any amendment or supplement to the
Offering Memorandum, as of its respective date, and as of the Closing Date
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
In rendering such opinion, counsel may rely (A) as to matters
of fact on (1) the representations and warranties of the Issuers and the Initial
Purchasers set forth in this Agreement and (2) certificates of responsible
officers of the Issuers and of public
28
29
officials; and (B) upon an opinion or opinions, each dated the Closing Date, of
other counsel retained by them or the Issuers as to laws of any jurisdiction
other than the United States and of the State of Michigan, provided that such
counsel is acceptable to the Initial Purchasers, and such reliance is expressly
authorized by each opinion so relied upon and a copy of such opinion is
delivered to the Initial Purchasers in form and substance reasonably
satisfactory to it and its counsel. Such opinion may also state, as to the
enforceability of the Indenture and this Agreement, that such counsel assumes
that the laws of the State of New York which effect enforceability are not
different from the laws of the State of Michigan (excluding choice of law rules
thereof).
(e) The Initial Purchasers shall have received on the
Closing Date an opinion of Xxxx Xxxxxxxxx, P.C., counsel for the Issuers, dated
the Closing Date and addressed to the Initial Purchasers as to the matters
referred to above (except for paragraphs (v), (vi) (viii), (xii), (xiii) and
(xiv)) and to the effect that:
(i) The execution, delivery and performance of the
Corporate Opportunity Agreement by Xxxxx X. Xxxxxx and the compliance by Xxxxx
X. Xxxxxx with all of the provisions thereof (1) does not require any consent,
approval, authorization or other order of any court, regulatory body,
administrative agency or other governmental body or authority or, if so
required, all such consents, approvals, authorizations and orders have been
obtained and are in full force and effect, (2) will not conflict with or
constitute a breach of any of the terms or provisions of, or a default under any
agreement, indenture or other instrument known to such counsel to which Xxxxx X.
Xxxxxx or any affiliate of Xxxxx X. Xxxxxx is a party or by which Xxxxx X.
Xxxxxx or any affiliate of Xxxxx X. Xxxxxx or any of their respective assets or
property is bound, and (3) will not violate or conflict with any material laws,
administrative regulations or rulings or court decrees applicable to Xxxxx X.
Xxxxxx or any affiliate of Xxxxx X. Xxxxxx or their respective property;
(ii) The Corporate Opportunity Agreement has been duly
executed and delivered by Xxxxx X. Xxxxxx and constitutes a valid, legal and
binding agreement of Xxxxx X. Xxxxxx, enforceable in accordance with its terms
except as (a) the enforceability thereof may be limited by or subject to
bankruptcy, insolvency, fraudulent conveyance, reorganization, arrangement,
moratorium, usury or similar laws now or hereafter affecting creditors' rights
generally, and (b) rights or remedies (including, without limitation,
acceleration, specific performance and injunctive relief) may be limited by
equitable principles of general applicability (including, without limitation,
standards of materiality, good faith, fair dealing and reasonableness) whether
such principles are considered in a proceeding in equity or at law, and may be
subject to the discretion of the court before which any proceedings therefor may
be brought.
(iii) Except as discussed in the Offering Memorandum (a)
none of the Trust or the Guarantors is in violation of its respective
certificate or articles of
29
30
incorporation, declaration of trust, bylaws, or other organizational documents
and (b) as to the material obligations, agreements and conditions contained in
any material bond, debenture, note or other evidence of indebtedness of the
Issuers which counsel is aware of or should reasonable be aware of given the
transactions counsel has materially been involved with ("Issuers' Debt") or any
material agreement, indenture, lease or other instrument to which the Issuers
are a party or by which any of them or any of their respective properties may be
bound which counsel is aware or should reasonably be aware of given the
transactions counsel has materially been involved with ("Issuers' Agreements"),
to the best knowledge of such counsel, after reasonable inquiry (which was
limited to reviewing documents in its possession and obtaining factual
explanations, representations and warranties from knowledgeable representatives
of the Trust or the Guarantors, the Trust or the Guarantors are not in material
default of such Issuers' Debt or Issuers' Agreements.
(iv) Except as discussed in the Offering Memorandum,
to the best knowledge of counsel, after reasonable inquiry and given the
transactions of the Trust and the Guarantors in which such counsel has been
materially involved with, none of the Trust or the Guarantors is materially in
violation of any law, ordinance, administrative or governmental rule or
regulation applicable to the Trust and the Guarantors or of any decree of any
court or governmental agency or body having jurisdiction over the Trust and the
Guarantors.
(v) The Trust is a grantor trust as described in
Section 1361 of the Code, or any similar provision of state or local law, and
each other Issuer, other than Venture Holdings Corporation is an S corporation,
as defined in Section 1361 of the Code, or is taxed as a partnership or other
pass-through entity for federal income tax purposes.
(vi) In rendering such opinion, counsel may rely as
to matters of fact on certificates of responsible officers of the Issuers and of
public officials. Such counsel may also state that he is not opining as to
matters relating to (a) environmental matters, (b) financial tests, (c) tax
calculations or (d) environmental, financial, tax or securities reporting.
(f) The Initial Purchasers shall have received on the Closing
Date an opinion of Xxxxx & XxXxxxxx, special counsel for the Issuers dated the
Closing Date and addressed to the Initial Purchasers, reasonably satisfactory to
the Initial Purchasers and substantially to the effect that:
(i) the consummation of the sale and purchase of
the shares of Peguform pursuant to the Share Purchase and Transfer Agreement
dated March 8, 1999 ("Share Purchase Agreement") will not violate any provision
of constituent documents (Articles of Incorporation) of Peguform;
(ii) the consummation of the sale and purchase of
the shares of Peguform pursuant to the Share Purchase Agreement will not result
in any default under any of the material agreements to which Peguform is a
party; and
30
31
(iii) the consummation of the sale of the shares of
Peguform as contemplated in the Share Purchase Agreement has been authorized by
the German Federal Cartel Office by letter dated April 21, 1999, and no other
consent, license, approval or authorization of any government, judicial or any
other authority in Germany is required in connection with the transfer of the
shares of Peguform and other assets pursuant to the Share Purchase Agreement and
the performance and completion of all other transactions contemplated thereby.
In rendering such opinion, counsel may rely as to matters of
fact on certificates of responsible officers of Peguform, public officials and
representations of Peguform in the Acquisition Agreements, to the extent such
counsel deems appropriate.
(g) The Initial Purchasers shall have received on the Closing
Date an opinion of Xxxxxx & Xxxxxxx, special counsel for the Initial Purchasers,
dated the Closing Date, and addressed to the Initial Purchasers, with respect to
such matters as the Initial Purchasers may request.
(h) The Initial Purchasers shall have received letters
addressed to the Initial Purchasers, and dated the date hereof and the Closing
Date, from Deloitte & Touche LLP and BDO International GmbH, independent
certified public accountants, substantially in the forms heretofore approved by
the Initial Purchasers.
(i) (i) There shall not have been any change in the capital
stock of the Trust or any of the Subsidiaries nor any material increase in the
short-term or long-term debt of the Trust or any of the Subsidiaries (other than
in the ordinary course of business) from that set forth in the Offering
Memorandum; (ii) there shall not have been, since the respective dates as of
which information is given in the Offering Memorandum, except as may otherwise
be stated therein, any material adverse change in the condition (financial or
other), business, prospects, properties, net worth or results of operations of
the Trust and the Subsidiaries taken as a whole; (iii) the Trust and the
Subsidiaries shall not have any liabilities or obligations, direct or contingent
(whether or not in the ordinary course of business), that are material to the
Trust and the Subsidiaries, taken as a whole, other than those reflected in the
Offering Memorandum; and (iv) all the representations and warranties of the
Issuers contained in this Agreement shall be true and correct in all material
respects on and as of the date hereof and on and as of the Closing Date as if
made on and as of the Closing Date, and the Initial Purchasers shall have
received a certificate, dated the Closing Date and signed by the chief executive
officer and the chief financial officer of the Issuers (or such other officers
as are acceptable to the Initial Purchasers), to the effect set forth in this
Section 7(h) and in Section 7(i) hereof.
(j) Each of the Issuers shall not have failed at or prior to
the Closing Date to have performed or complied in all material respects, with
any of their
31
32
agreements herein contained and required to be performed or complied with by
them hereunder at or prior to the Closing Date.
(k) After the date hereto and at or prior to the Closing Date
there shall not have been any announcement by any "nationally recognized
statistical rating organization," as defined for purposes of Rule 436 (g) under
the Act, that (i) it is downgrading its rating assigned to any class of
securities of the Issuers, or (ii) it is reviewing its ratings assigned to any
class of securities of the Issuers with a view to possible downgrading, or with
negative implications, or direction not determined.
(l) The Notes shall have been approved for trading on PORTAL.
(m) The Issuers shall have furnished or caused to be furnished
to the Initial Purchasers such further certificates and documents as the Initial
Purchasers shall have reasonably requested.
All such opinions, certificates, letters and other documents
will be in compliance with the provisions hereof only if they are satisfactory
in form and substance to the Initial Purchasers and counsel for the Initial
Purchasers.
Any certificate or document signed by any officer of an Issuer
and delivered to the Initial Purchasers, or to counsel for the Initial
Purchasers, shall be deemed a representation and warranty by such Issuer to the
Initial Purchasers as to the statements made therein.
8. EXPENSES. (a) Whether or not the purchase and sale of the
Notes hereunder is consummated or this Agreement is terminated pursuant to
Section 9, each of the Issuers jointly and severally agrees to pay the following
costs and expenses and all other costs and expenses incident to the performance
by it of its obligations hereunder: (i) the preparation, printing, or
reproduction of the Preliminary Offering Memorandum, Offering Memorandum
(including financial statements thereto), and each amendment or supplement to
any of them; (ii) the delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of the Offering Memorandum,
the Preliminary Offering Memorandum, and all amendments or supplements to any of
them as may be reasonably requested for use in connection with the offering and
sale of the Notes; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Notes, including any stamp taxes in connection
with the original issuance and sale of the Notes; (iv) the printing (or
reproduction) and delivery of this Agreement, the preliminary and supplemental
Blue Sky Memoranda and all other agreements or documents printed (or reproduced)
and delivered in connection with the offering of the Notes; (v) the application
for quotation of the Notes on the PORTAL market; (vi) the qualification of the
Notes for offer and sale under the securities or Blue Sky laws of the several
states as provided in Section 4 (f) hereof (including the reasonable fees,
expenses and disbursements of counsel for the Initial Purchasers relating to the
preparation, printing or reproduction, and delivery of the preliminary and
supplemental Blue Sky Memoranda and such qualification); (vii) the performance
by each of the Issuers of its obligations under the Registration Rights
32
33
Agreement; (viii) the fees and expenses of the Issuers' accountants and the fees
and expenses of counsel (including local and special counsel) for the Issuers;
(ix) the fees and expenses of the Trustee, including the fees and disbursements
of counsel for the Trustee in connection with the Indenture and the Notes; and
(x) any fees payable in connection with the rating of the Notes.
(b) If the purchase and sale of the Notes hereunder is not
consummated because any condition to the obligations of the Initial Purchasers
set forth in Section 7 hereof is not satisfied, because this Agreement is
terminated pursuant to Section 9 hereof, or because of any failure, refusal or
inability on the part of the Issuers to perform all obligations and satisfy all
conditions on their part to be performed or satisfied hereunder other than by
reason of a default by the Initial Purchasers in payment for the Notes on the
Closing Date, the Issuers shall reimburse the Initial Purchasers promptly upon
demand for all out-of-pocket expenses (including fees and disbursements of
counsel) that shall have been incurred by it in connection with the proposed
purchase and sale of the Notes and the other transactions contemplated hereby.
9. TERMINATION OF AGREEMENT. (a) This Agreement shall be
subject to termination in the absolute discretion of the Initial Purchasers,
without liability on the part of the Initial Purchasers to the Issuers or any
other party, by notice to the Trust, if prior to the Closing Date, (i) trading
in securities generally on the New York Stock Exchange, the American Stock
Exchange or the NASDAQ National Market shall have been suspended or materially
limited, (ii) a general moratorium on commercial banking activities in New York
or Chicago shall have been declared, or (iii) there shall have occurred any
outbreak or escalation of hostilities or other U.S. or international calamity,
crisis or change in political, financial or economic conditions, the effect of
which on the financial markets of the United States is such as to make it, in
the judgment of the Initial Purchasers, impracticable or inadvisable to commence
or continue the offering of the Notes on the terms set forth on the cover page
of the Offering Memorandum or to enforce contracts for the resale of the Notes
by the Initial Purchasers. Notice of such termination may be given to the
Issuers by telegram, telecopy or telephone and shall be subsequently confirmed
by letter.
(b) If either Initial Purchaser shall default in its
obligation to purchase the Notes which it has agreed to purchase hereunder, the
non-defaulting Initial Purchaser may in its discretion arrange for it or another
party or other parties satisfactory to the Trust to purchase such Notes on the
terms contained herein. If within thirty-six hours after such default by any
Initial Purchaser the non-defaulting Initial Purchaser does not arrange for the
purchase of such Notes, then the Trust shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to the non-defaulting Initial Purchaser to purchase such Notes on
such terms. In the event that, within the respective prescribed periods, the
non-defaulting Initial Purchaser notifies the Trust that it has so arranged for
the purchase of such Notes, the non-defaulting Initial Purchaser or the Trust
shall have the right to postpone the Closing Date for a period of not more than
seven days, in order to effect whatever changes may thereby be made necessary in
the Offering Memorandum, or in any other documents or arrangements, and the
Trust agrees to prepare promptly any amendments to the Offering
33
34
Memorandum which in the opinion of the non-defaulting Initial Purchaser may
thereby be made necessary. The term "Initial Purchaser" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Notes.
(c) If, after giving effect to any arrangements for the
purchase of the Notes of a defaulting Initial Purchaser or Initial Purchasers by
the non-defaulting Initial Purchaser and the Trust as provided in subsection (a)
above, the aggregate principal amount of such Notes which remains unpurchased
does not exceed one-eleventh of the aggregate principal amount of all the Notes,
then the Trust shall have the right to require each non-defaulting Initial
Purchaser to purchase the principal amount of Notes which such Initial Purchaser
agreed to purchase hereunder and, to require each non-defaulting Initial
Purchaser to purchase its pro rata share (based on the principal amount of Notes
which such Initial Purchaser agreed to purchase hereunder) of the Notes of such
defaulting Initial Purchaser or Initial Purchasers for which such arrangements
have not been made; but nothing herein shall relieve a defaulting Initial
Purchaser from liability for its default.
(d) If, after giving effect to any arrangements for the
purchase of the Notes of a defaulting Initial Purchaser or Initial Purchasers by
the non-defaulting Initial Purchaser and the Trust as provided in subsection (a)
above, the aggregate principal amount of Notes which remains unpurchased exceeds
one-eleventh of the aggregate principal amount of all the Notes, or if the Trust
shall not exercise the right described in subsection (b) above to require
non-defaulting Initial Purchasers to purchase Notes of a defaulting Initial
Purchaser or Initial Purchasers, then this Agreement shall thereupon terminate,
without liability on the part of any non-defaulting Initial Purchaser or the
Trust, except for the expenses to be borne by the Trust and the Initial
Purchasers as provided in Section 8 hereof and the indemnity and contribution
agreements in Section 6 hereof; but nothing herein shall relieve a defaulting
Initial Purchaser from liability for its default.
10. INFORMATION FURNISHED BY THE INITIAL PURCHASERS. The
statements in the eighth paragraph and the last sentence of the third paragraph
under the caption "Plan of Distribution" in the Preliminary Offering Memorandum
and Offering Memorandum constitute the only information furnished in writing by
or on behalf of the Initial Purchasers as such information is referred to in
Sections 5 (b) and 6 hereof.
11. MISCELLANEOUS. Except as otherwise provided in Sections
4 and 9 hereof, notice given pursuant to any provision of this Agreement shall
be in writing and shall be delivered (i) if to the Issuers, at the office of the
Trust at 33662 Xxxxx X. Xxxxx Xxxxx, Xxxxxx, Xxxxxxxx 00000, Attention: Xxxxx X.
Xxxxxx, with a copy to Xxxxxx Xxxxxxx, 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000-0000, Attention: Xxxxxxxx Xxxxxx, and a copy to Xxxx Xxxxxxxxx, P.C., 0000
X. Xxxxxxxx, Xxxxx 000, Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000 or (ii) if to the
Initial Purchasers, c/o Banc One Capital Markets Inc., One First Xxxxxxxx Xxxxx,
Xxxx Xxxxx 0000, Xxxxxxx XX, 00000, Attention:
34
35
High Yield Origination, with a copy to Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxx, XX, 00000-0000, Attention: Xxxxxxx X. Xxxxxx.
This Agreement has been and is made solely for the benefit of
the Initial Purchasers, the Issuers, their directors and officers and the
controlling persons referred to in Section 6 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
acquire or have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from the Initial Purchasers of any of the Notes in his
status as such purchaser.
12. APPLICABLE LAW; GOVERNING LAW; COUNTERPARTS. This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed within the State of New
York and without regard to the conflicts of law principles thereof.
35
36
This Agreement may be signed in various counterparts which
together constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
Please confirm that the foregoing correctly sets forth the
agreement between the Issuers and the Initial Purchasers.
Very truly yours,
VENTURE HOLDINGS TRUST
VEMCO INC.
VEMCO LEASING, INC.
VENTURE INDUSTRIES CORPORATION
VENTURE HOLDINGS CORPORATION
VENTURE LEASING COMPANY
VENTURE MOLD & ENGINEERING
CORPORATION
VENTURE SERVICE COMPANY
EXPERIENCE MANAGEMENT LLC
VENTURE EUROPE, INC.
VENTURE EU CORPORATION
VENTURE HOLDINGS COMPANY LLC
By: /s/Xxxxx X. Xxxxxx, Xx.
-----------------------
Name: Xxxxx X. Xxxxxx, Xx.
Title: Chief Financial Officer
36
37
Confirmed as of the date first above mentioned.
BANC ONE CAPITAL MARKETS, INC.
XXXXXXX, XXXXX & CO.
By: BANC ONE CAPITAL MARKETS, INC.
By: /s/Xxxxxx Xxxxx
---------------
Name: Xxxxxx Xxxxx
Title: Managing Director
37
38
SCHEDULE A
SUBSIDIARIES OF THE TRUST
Name Jurisdiction
---- of Organization
---------------
Vemco Inc. (no subsidiaries) Michigan
Vemco Leasing, Inc. (no subsidiaries) Michigan
Venture Industries Corporation (no subsidiaries) Michigan
Venture Holdings Corporation (no subsidiaries) Michigan
Venture Leasing Company Michigan
Venture Mold & Engineering Corporation (no Michigan
subsidiaries)
Venture Service Company Michigan
Experience Management LLC (no subsidiaries)* Michigan
Venture Europe, Inc. (no subsidiaries)** Michigan
Venture EU Corporation (no subsidiaries)** Michigan
Venture Industries Canada Ltd. (no subsidiaries) Canada
Venture Germany GmbH (subsidiaries below) Germany
Venture Beteiligungs GmbH (no subsidiaries) Germany
Venture Verwaltungs GmbH (no subsidiaries) Germany
Venture Holdings Company LLC
Michigan
* Held by Venture Service Company (1%) and
Venture Holdings Trust (99%)
** Held by Venture Leasing Company
38
39
SCHEDULE B
MATERIAL SUBSIDIARIES OF PEGUFORM, GmbH
Name Jurisdiction of
---- Incorporation
-------------
Peguform France S.A. France
Peguform Iberica S.A. Spain
Peguform Bohemia a.s. Xxxxx Xxxxxxxx
00
00
SCHEDULE C
PRINCIPAL AMOUNT PRINCIPAL AMOUNT OF
INITIAL PURCHASER OF SENIOR NOTES SENIOR SUBORDINATED NOTES
----------------- --------------- -------------------------
BANC ONE CAPITAL MARKETS, INC. $ 93,750,000 $ 93,750,000
Xxxxxxx, Sachs & Co. $ 31,250,000 $ 31,250,000
TOTAL $125,000,000 $125,000,000
============ ============
40
