Formation Agreement

EXHIBIT 10.33 FORMATION AGREEMENT THIS AGREEMENT, made as of the ___ day of October, 1986, BETWEEN:NISHIKAWA RUBBER CO., LTD., a corporation organized under the laws of Japan andhaving its principal office in Hiroshima, Japan (hereinafter called"Nishikawa"), and THE STANDARD PRODUCTS COMPANY, a corporation organized underthe laws of the State of Ohio, United States of America, and having itsprincipal office in Cleveland, Ohio (hereinafter called "Standard"), WITNESS AS FOLLOWS: WHEREAS, Nishikawa is engaged in the manufacture and sale in Japan ofsponge and multi-durometer extruded and molded rubber products for use byJapanese motor vehicle manufacturers; WHEREAS, Standard is experienced in the manufacture and sale in NorthAmerica of other rubber and plastic parts for use by North American motorvehicle manufacturers; and WHEREAS, the parties desire jointly to establish in the United States afacility to manufacture sponge and multi-durometer extruded and molded rubberproducts ("the Products") to motor vehicle manufacturers located in the UnitedStates, Canada and Mexico ("the Territory"). NOW, THEREFORE, the parties hereto, intending to be legally bound,hereby agree as follows: 1. Formation of Company. 1.1 Name. The name of the entity that operates the jointly ownedfacility shall be Nishikawa Standard Company ("the Company"). 1.2 Purpose. The purpose of the Company shall be the manufactureand sale of the Products and related products to motor vehicle manufacturerslocated in the Territory. It is understood that the Company may elect tomanufacture windlace which would be attached to Products, and that windlace is a"related product". The initial sales targets shall be Japanese owned, operatedor licensed motor vehicle manufacturers, particularly Honda, Mitsubishi("Diamond Star") and Mazda. Secondary targets will be Toyota, Nissan and Nummi.If practicable, the Company may eventually attempt to sell to North Americanmotor vehicle manufacturers such as General Motors, Ford and Chrysler. 1.3 Plant. The parties have agreed that the Company shall purchasea plant in Topeka, Indiana, presently owned by United Technologies, Inc. 1.4 Formation. The parties have agreed to form a corporation underthe laws of the State of Indiana. The Articles of Incorporation and Bylaws shallbe in the form of Exhibits A and B attached hereto. The parties agree to takesuch action and file such notices and other documents as may be legallynecessary to establish the Company. 2. Financing. 2.1 Capital. The initial share capital of the Company shall beThree Hundred Thousand Dollars ($300,000) of which sixty percent (60%) shall becontributed by Nishikawa and forty percent (40%) shall be contributed byStandard. The initial capital shall be paid in cash promptly after the Companyis organized. Upon call of the Board of Directors, the share capital of theCompany may be increased from time to time to an aggregate of not to exceed FiveMillion Dollars ($5,000,000), it being understood that all additional capitalcontributions shall be made in the same 60/40 ratio. 2 2.2 Borrowings. It is anticipated that the Company will befinanced in part by borrowed funds. If feasible, some or all of such financingwill be raised through the issuance of industrial revenue bonds. Regardless ofthe means by which the Company is financed, an effort will be made to avoidguarantees of the Company's debt by Nishikawa and Standard. If the partiessubsequently determine that guarantees cannot be avoided, the guarantees will belimited so that Nishikawa guarantees sixty percent (60%) of the debt andStandard guarantees forty percent (40%) of the debt. 3. Management. 3.1 Overall Responsibility. Nishikawa will be responsible foroverall operation of the Company, including engineering, manufacturing, salesand general administration of the Company, while Standard will be responsiblefor personnel-labor matters and otherwise assist the Company in obtainingqualified personnel and in doing business in North America. 3.2 Board of Directors. Initially, there shall be seven members ofthe Board of Directors. The initial members of the Board of Directorsrepresenting Nishikawa shall be FUMYEA TAKEDA, TAKASHI ISE, YASUO NISHIKAWA andJACK K. KURAMOTO. Standard's initial representatives shall be JAMES S. REID,JR., ROBERT B. STEVENS and THOMAS E. JUDY. Either of Nishikawa or Standard may,at any time, and from time to time, remove its representative(s) on the Board ofDirectors and designate a successor. In the event the parties agree on a changein the number of directors, the approximate 60/40 representation concept shallbe retained. During the term of this Agreement the parties agree to vote theirshares in the Company to preserve the 4/3 representation contemplated by thissection. The 3 Board of Directors shall have such powers and duties as provided by law and asset forth in Exhibit B. 3.3 Officers. Fumyea Takeda shall act as President of the Companyand, initially, J. Richar ...