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EXHIBIT 4.2.1
FIRST SUPPLEMENTAL INDENTURE
First Supplemental Indenture dated as of August 8, 1996, among Venture
Holdings Trust, a grantor trust organized under the laws of Michigan (the
"Trust"), Vemco, Inc., Venture Industries Corporation, Venture Mold &
Engineering Corporation, Venture Leasing Company, Vemco Leasing, Inc., Venture
Holdings Corporation and Venture Service Company, each a Michigan corporation
(each an "Issuer" and together with the Trust, the "Issuers"), Venture
Industries Canada Ltd., an Ontario corporation, as Guarantor, and Comerica
Bank, as trustee (the "Indenture Trustee"), to the Indenture dated as of
February 16, 1994 (the "Indenture") among the Issuers, the Guarantor and the
Indenture Trustee. Capitalized terms not otherwise defined herein shall have
the meanings assigned to such terms in the Indenture.
RECITALS
WHEREAS, the Issuers have executed and delivered the Indenture to the
Indenture Trustee to provide for the issuance of their 9-3/4% Senior
Subordinated Notes due 2004 (the "Securities"); and
WHEREAS, Vemco Acquisition Corp., a Delaware corporation formed by the
Trust ("Acquisition"), has entered into an Agreement and Plan of Merger dated
June 5, 1996 (the "Merger Agreement") with Bailey Corporation, a Delaware
corporation ("Bailey"), pursuant to which Acquisition has or will acquire
Bailey (the "Bailey Acquisition"); and
WHEREAS, pursuant to Section 902 of the Indenture the Holders of at
least a majority in aggregate principal amount of the Outstanding Securities
(the "Requisite Holders") have consented in writing to the execution and
delivery of this First Supplemental Indenture which provides, among other
things, for the amendment of certain provisions of the Indenture and the
consent of such holders to certain transactions in connection with the Bailey
Acquisition; and
WHEREAS, each of the Issuers and the Guarantor severally represents
and warrants that (i) it has the authority to execute and deliver this First
Supplemental Indenture, (ii) the execution of this First Supplemental Indenture
has been duly authorized by it and (iii) all acts necessary to constitute this
First Supplemental Indenture the valid, binding and legal obligation of each of
the Issuers and the Guarantor have been performed and fulfilled;
NOW, THEREFORE, as of the date hereof, it is mutually agreed as
follows:
SECTION 1. Amendments. (a) Section 101 of the Indenture is amended
by adding the following definitions in the proper alphabetical order.
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"Acquisition" means Vemco Acquisition Corp., a Delaware, corporation,
or its successor.
"AutoStyle Assets"means the interest of the Issuers and their
Subsidiaries, and related obligations, in certain assets acquired on or after
June 3, 1996 from AutoStyle Plastics, Inc.
"Bailey" means Bailey Corporation, a Delaware corporation.
"Bailey Acquisition" means the acquisition by the Trust of a majority
of the outstanding shares of common stock of Bailey pursuant to an Agreement
and Plan of Merger dated June 5, 1996 between Acquisition and Bailey as the
same may be amended or supplemented.
"Designation" means the designation by the Issuers of Acquisition and
New AutoStyle as Unrestricted Subsidiaries, both of which shall be done on or
before February 15, 1997; provided that as of date of such designation (the
"Designation Date") the following provision is compiled with: the Issuers shall
deliver to the Indenture Trustee and the Holders (i) a calculation of the
Consolidated Fixed Charge Coverage Ratio (the "Ratio"), (ii) the four limited
review reports each in the form as set forth on Schedule A hereto of Issuers'
independent certified public accountants with respect to the financial
statements upon which such calculation is based and (iii) a letter describing
the performance by such accountants of certain procedures as set forth in
Schedule B hereto relating to the Ratio in accordance with Section 6 of the
First Supplemental Indenture. The Ratio shall be based on the actual results of
the Trust for the four full fiscal quarters immediately preceding the
Designation Date as to which financial statements are available and have been
sent to the Holders pursuant to the Indenture, but excluding the results of
Bailey and its subsidiaries and New AutoStyle, and only giving effect to the
Indebtedness which the Issuers and their Subsidiaries are to be liable for
after the Designation.
"Designation Date" has the meaning set forth in the definition of
Designation.
"First Supplemental Indenture" means that certain First Supplemental
Indenture dated August 8, 1996, among the Issuers, the Guarantors and the
Indenture Trustee.
"NBD Debt" means the portion of the Indebtedness of the Issuers under
the Credit Agreement in an aggregate principal amount at any one time
outstanding not to exceed $220 million less any outstanding Indebtedness of
Bailey which is not repaid at or about the date of consummation of the Bailey
Acquisition, provided that such sum is used as is necessary to, among other
things, (i) repay the existing Senior Secured Notes and Indebtedness owed to
NBD Bank, (ii) consummate the Bailey Acquisition, (iii) repay some or all of
Bailey's
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outstanding Indebtedness to its existing creditors and (iv) fund the Offer to
Purchase referred to in Section 4 of the First Supplemental Indenture.
"New AutoStyle" means a new corporation to be formed by the Trust as a
Subsidiary which holds the AutoStyle Assets.
"Refinancings" means with respect to any indebtedness, any amendments,
renewals, extensions, substitutions, refinancings, restructurings, replacements
or supplementations or other modifications thereof (including, without
limitation, successive renewals, extensions, substitutions, refinancings,
restructurings, replacements, supplementations or other modifications of any
such Indebtedness).
(b) The definition of Consolidated Non-cash Charges set forth in
Section 101 of the Indenture is amended by adding the following at the and
thereof:
", and including those cash charges incurred in connection
with the repayment of Indebtedness of the Issuers with a
portion of the borrowings under the Credit Agreement and other
cash charges incurred in connection with the Bailey
Acquisition up to a maximum amount of $3 million less the
amount of the gain realized by the Issuers in connection with
the Offer to Purchase referred to in Section 4 of the First
Supplemental Indenture."
(c) Effective on the date of the Bailey Acquisition, the
definition of Credit Agreement set forth in Section 101 of the Indenture is
amended by deleting such definition in its entirety and substituting the
following in lieu thereof:
"Credit Agreement" means the Credit Agreement, to be dated on
or about the date of the Bailey Acquisition, among the Issuers
party thereto, the lenders and other Persons party thereto
from time to time and NBD Bank, as Agent for such lenders,
together with all agreements, documents and instruments from
time to time delivered pursuant them, as such agreement, in
whole or in part, may be amended, renewed, extended,
substituted, refinanced, restructured, replaced, supplemented
or otherwise modified from time to time (including, without
limitation, any successive renewals, extensions,
substitutions, refinancings, restructurings, replaced,
supplementations or other modifications of the foregoing)."
(d) The definition of Permitted Indebtedness set forth in Section
101 of the Indenture is amended by (x) deleting paragraph (i) therein in its
entirely and substituting the following in lieu thereof:
"(1)Indebtedness of the Issuers in an aggregate principal
amount at any one time outstanding not to exceed the amount of
NBD Debt and its Refinancings and Indebtedness of Bailey and
its Refinancings, permitted under Section 3(e) of the First
Supplemental Indenture;"
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and (y) adding at the end of paragraph (viii) thereof the following:
";provided, however, that the provisions of this clause
(viii) shall only apply if Bailey is (x) designated an
Unrestricted Subsidiary, (y) redesignated from an Unrestricted
Subsidiary to a Subsidiary or (iii) permitted to remain a
Subsidiary, all in accordance with the provisions of the First
Supplemental Indenture.
(e) Section 1009(a)(vii)(A) of the Indenture is amended by adding
at the end thereof, ", minus $15 million."
(f) Section 1009(b) of the Indenture is amended by: (i) deleting
the "and," before "(v)" on line four thereof and adding immediately thereafter
" (v)", the following: ", (vi), (vii), (viii), (ix) and (x)" and (ii) adding
at the end thereof the following:
"(vi) The assignment and transfer to the Trust by
the Subsidiaries of an amount in cash not to exceed the lesser
of $13 million and the maximum amount permitted to be paid as
of June 30, 1996 as a Restricted Payment pursuant to Section
1009(a) of the Indenture and the transfer of such sum to
Acquisition, provided that the Bailey Acquisition shall have
occurred simultaneously with or prior to such transfer to
Acquisition;
(vii) The assignment and transfer to the Trust by the
Subsidiaries of their interest in the AutoStyle Assets;
(viii) The assignment and transfer by the Issuers to
New AutoStyle of the AutoStyle Assets and/or the Designation
of New AutoStyle as an Unrestricted Subsidiary on or before
February 15, 1997, provided that the Designation of
Acquisition as an Unrestricted Subsidiary shall occur
simultaneously with or prior to such Designation of New
AutoStyle;
(ix) The Designation of Acquisition as an
Unrestricted Subsidiary (it being understood that if
Acquisition is thereafter redesignated as a Subsidiary, such
redesignation shall have no effect on the calculations set
forth in Section 1009(a) of the Indenture); and
(x) The Issuers, Venture Canada, Acquisition and/or
New AutoStyle incurring the NBD Debt."
(g) Section 1010 shall be amended to add the following introductory
paragraph:
"Except as to (i) the Issuers transferring to the Trust all of their
rights in and to the AutoStyle Assets and related rights and obligations, (ii)
the Trust transferring to New AutoStyle all of its rights in and to the
AutoStyle Assets and related rights and obligations, and/or (iii) on or before
February 15, 1997, the Designation of Acquisition and New AutoStyle as
Unrestricted Subsidiaries:"
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(h) Sections 1010(a) and (b) of the Indenture are amended by
deleting such sections in their entirety and substituting the following in lieu
thereof:
"(a) The Trust will not, and will not permit any of its Subsidiaries
to, and, during any period that they are Unrestricted Subsidiaries, as to
transactions between New AutoStyle or Acquisition on the one hand and
Affiliates of theirs (other than transactions benefiting the Trust or its
Subsidiaries) on the other hand, to, directly or indirectly, make any loan,
advance, guarantee or capital contribution to, or for the benefit of, or sell,
lease, transfer or otherwise dispose of any of its properties or assets to, or
for the benefit of, or purchase or lease any property or assets from, or enter
into or amend, or increase the payments by the Trust or any of its Subsidiaries
under or otherwise alter the terms of, any contract, agreement or understanding
with, or for the benefit of, any Affiliate of the Trust (including any
Affiliates of such Affiliates) (each, an "Affiliate Transaction") except for
any Affiliate Transaction the terms of which are fair and reasonable to the
Trust or such Subsidiary, as the case may be, and are at least as favorable as
the terms which could be obtained by the Trust or such Subsidiary, as the case
may be, in a comparable transaction made on an arm's-length basis with Persons
who at not such an Affiliate of the Trust; provided, however, that Affiliated
Transactions shall not include (1) any transaction with an officer or member of
the Board of Directors of the Trust or any Subsidiary entered into in the
ordinary course of business (including compensation or employee benefit
arrangements with any officer or member of the Board of Directors of the Trust
or any such Subsidiary, (2) performance of any agreement in existence on the
date of this Indenture in accordance with its terms as in effect on such date
or (3) any Restricted Payment or Permitted Payment permitted under Section
1009.
(b) In addition, the Trust will not, and will not permit any
Subsidiary of the Trust to, and, during any period that they are Unrestricted
Subsidiaries, as to transactions between New AutoStyle or Bailey on the one
hand and Affiliates of theirs (other than transactions benefiting the Trust or
its Subsidiaries) on the other hand, to, enter into an Affiliate Transaction,
or any series of related Affiliate Transactions, unless (i) with respect to
such Transaction or Transactions involving or having a fair value of more than
$250,000 the Trust has (x) obtained the approval of majorities of the Board of
Directors of the Trust (in the case of the Trust and Venture Canada) or such
Subsidiary, as the case may be, and the Fairness Committee of the Trust (in the
case of the Trust and Venture Canada or such Subsidiary, as the case may be, in
the exercise of their fiduciary duties and (y) either (i) obtained the approval
of majorities of the disinterested directors of the Trust (in the case of the
Trust and Venture Canada) or such Subsidiary, as the case may be, if any, and
Independent members of the Fairness Committee or (2) obtained an opinion of a
qualified independent financial advisor to the effect that such Transaction or
Transactions are fair to the Trust or such Subsidiary, as the case may be, from
a financial point of view and (ii) with respect to such Transaction or
Transactions involving or having a fair value of more than $3.0 million, the
Trust has (x) obtained the approval of majorities of the Board of Directors of
the Trust (in the case of the Trust and Venture Canada) or such Subsidiary as
the case may be and the Fairness Committee of the Trust (in the case of the
Trust and Venture Canada) or such Subsidiary as the case may be in the exercise
of their fiduciary duties, including majorities of the disinterested directors
of the Trust (in the case of the Trust and Venture Canada) or such Subsidiary,
as the case may be, if any, and Independent
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members of the Fairness Committee, and (y) delivered to the Indenture Trustee
an opinion of a qualified independent financial advisor to the effect that such
Transaction or Transactions are fair to the Trust or such Subsidiary, as the
case may be, from a financial point of view."
(i) Section 1021 of the Indenture is hereby amended by adding at
the end of such Section the following:
"On or prior to 15 days after the Required Filing Date, the
Issuers, at the Issuers' cost, will certify to and provide to the
Indenture Trustee and all Holders quarterly reports and yearly reports
(i) prepared by the Issuers on a basis which is consistent with the
preparation of the reports, required by the first paragraph of this
Section 1021, (ii) which are not reviewed or certified to by any
accounting firm and (iii) which reflect the consolidated financial
statements of the Trust and its subsidiaries, excluding Acquisition
and New AutoStyle prior to the Designation Date and thereafter so long
as Acquisition and New AutoStyle are designated Unrestricted
Subsidiaries."
SECTION 2. Acquisition and Bailey Guarantee. Pursuant to
Section 1013 of the Indenture, by executing this First Supplemental Indenture,
each of Acquisition and, upon its merger into Bailey, Bailey, is hereby deemed
a Guarantor and shall be bound by the provisions of Article Fourteen of the
Indenture so long as Bailey is a Subsidiary of the Trust. The provisions of
Section 1013(c)(ii) shall not apply to such guaranty.
SECTION 3. Consents. The Requisite Holders, by execution of
the consents referred to in the recitals hereto, have consented, and do hereby
consent, to the following:
(a) The assignment and transfer to the Trust by
the Subsidiaries of an amount in cash not to exceed the lesser of $13 million
and the maximum amount permitted to be paid as of June 30, 1996 as a Restricted
Payment pursuant to Section 1009(a) of the Indenture and the transfer of such
sum to Acquisition or its successor, provided that the Bailey Acquisition shall
have occurred simultaneously with or prior to such transfer to Acquisition.
(b) The Subsidiaries transferring to the Trust
all of the Trust's right to the AutoStyle Assets with the same being considered
a Permitted Payment.
(c) The Trust creating New AutoStyle and
transferring to it the AutoStyle Assets.
(d) Subject to the consummation of the Bailey
Acquisition, the Trust offering to each of the Holders (which offer shall be
commenced on or before August 19, 1996), a payment of $950 (maximum,
$20,007,000), plus interest accrued to date, for each $l000 (maximum,
$21,060,000) of principal amount of Securities, pro rata to all tendering
Holders who tender their Securities (the "Offer to Purchase") in accordance
with the procedures set forth in Section 1014 of the Indenture, other than the
time periods set forth in subsection (a) thereof. The Offer to Purchase shall
be consummated no earlier than 20 Business Days and no later than 25 Business
Days after the commencement date of the Offer to Purchase.
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(e) Subject to the consummation of the Bailey
Acquisition, the Trust and its Subsidiaries incurring up to $220,000,000 of (i)
NBD Debt, which may be amended, renewed, extended, substituted, refinanced,
restructured, replaced, supplemented or otherwise modified from time to time
(including, without limitation, any successive renewals, extensions,
substitutions, refinancings, restructurings, replacements, supplementations or
other modifications of the foregoing), all of which are herein referred to as
the "Refinancings", provided that (y) as to the revolving credit facility of
such NBD Debt, it may not exceed the amount thereof in effect as of the date of
the Credit Agreement, but in no event more than $120 million, and (z) as to the
term facility portion of such NBD Debt, no Refinancing may be in a principal
amount in excess of the then outstanding principal amount thereof, and (ii)
Indebtedness of Bailey and its Refinancings (provided that as to such
Indebtedness of Bailey, no Refinancings may be in a principal amount in excess
of the then outstanding principal amount thereof), provided that such NBD Debt
is used as is necessary to, among other things, (i) repay the existing Senior
Secured Notes and Indebtedness owed to NBD Bank, (ii) consummate the Bailey
Acquisition, (iii) repay some or all of Bailey's outstanding Indebtedness to
its existing creditors and (iv) fund the Offer to Purchase.
(f) The Bailey Acquisition being made by
Acquisition as a Subsidiary of the Trust.
(g) Acquisition being merged into Bailey.
(h) On or before February 15, 1997, the Trust
having the option of making the Designation as to Acquisition and New AutoStyle
and the same shall not be considered a Restricted Payment and they shall
thereafter be deemed Unrestricted Subsidiaries for all purposes of the
Indenture.
SECTION 4. Offer to Purchase. In consideration for the
Requisite Holders consenting to the execution and delivery of this First
Supplemental Indenture and subject to the consummation of the Bailey
Acquisition, on or before August 19, 1996, the Issuers shall commence the Offer
to Purchase in accordance with the provisions of Section 3(d) hereof.
SECTION 5. Recission of Prior Indenture. Effective upon the
date hereof, the Supplemental Indenture dated as of May 29, 1996 among the
Issuers, the Guarantor and the Indenture Trustee is hereby terminated and
rescinded and shall be of no further force and effect.
SECTION 6. Increase in Interest Rate. The interest rate on
the Outstanding securities shall be increased by 2% per annum to 11-3/4% per
annum as of February 15, 1997, unless as of February 15, 1997 (or on the
Designation Date, if earlier), the Trust is able to borrow one additional
dollar of Indebtedness (other than Permitted Indebtedness) under Section 1008
of the Indenture. In performing such calculation, whether or not the
Designation has occurred, the provisions in the definition of Designation with
respect to the calculation of the Ratio shall apply, except that if the
Designation has not occurred on or before February 15, 1997, the actual results
of Bailey and its subsidiaries and New AutoStyle shall not be excluded in
determining the
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Ratio.
SECTION 2. Miscellaneous (a) This First Supplemental
Indenture is limited as specified herein and, except as provided herein, shall
not constitute a modification, acceptance or waiver of any other provision of
the Indenture, all of which shall continue to be in full force and effect and
are hereby ratified and confirmed in all respects.
(b) This First Supplemental Indenture may be executed in
any number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument.
(c) From and after the date hereof, all references in the
Indenture to the Indenture shall be deemed to be references to the Indenture as
modified hereby.
(d) This First Supplemental Indenture shall be governed
by, construed and enforced in accordance with the laws of the State of New
York, without regard to the conflict of laws principles thereof.
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed and attested, all as of the day and
year first above written.
VENTURE HOLDINGS TRUST
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VEMCO, INC.
Attest: /s / Larry Winget By: /s/ Michael Torakis
--------------------------- --------------------------
Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
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VENTURE INDUSTRIES
CORPORATION
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VENTURE MOLD ENGINEERING
CORPORATION
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VENTURE LEASING COMPANY
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VEMCO LEASING, INC.
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
--------------------------- --------------------------
Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
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VENTURE HOLDINGS
CORPORATION
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
--------------------------- --------------------------
Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VENTURE SERVICE COMPANY
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VENTURE INDUSTRIES CANADA
LTD., AS GUARANTOR
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
VEMCO ACQUISITION CORP.
AS GUARANTOR
Attest:. /s/ Larry Winget By: /s/ Michael Torakis
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Name: Larry Winget Name: Michael Torakis
Title: CEO Title: President
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COMERICA BANK,
AS INDENTURE TRUSTEE
Attest:. /s/ Marilyn A. Karam By: /s/ James Kowalski
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Name: Marilyn A. Karam Name: James Kowalski
Title: Vice President Title: Trust Administrator