As filed with the Securities and Exchange Commission on
August 24, 2000.
Registration No. 333-43116
======================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM S-3/A
Amendment No. 1 to Form S-3
Registration Statement
Under
The Securities Act of 1933
_______________________
ARVINMERITOR, INC.
(Exact name of registrant as specified in its charter)
INDIANA 38-3354643
(State or other (I.R.S. employer
jurisdiction of identification
incorporation or number)
organization)
2135 West Maple Road
Troy, Michigan 48084-7186
(248) 435-1000
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
VERNON G. BAKER, II
SENIOR VICE PRESIDENT, GENERAL COUNSEL
AND SECRETARY
ARVINMERITOR, INC.
2135 West Maple Road
Troy, Michigan 48084-7186
(248) 435-1000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
With a copy to:
Frederick L. Hartmann
Schiff Hardin & Waite
6600 Sears Tower
Chicago, Illinois 60606-6473
(312) 258-5000
___________________________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE REGISTRATION STATEMENT BECOMES EFFECTIVE.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. [x]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for
the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
======================================================================
<TABLE>
<CAPTION>
Proposed Proposed
Amount maximum maximum
Title of each class of to be offering price aggregate Amount of
securities to be registered registered per share offering price registration fee
(1) (1) (2)
-------------------------- -------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
Common Stock, $1 par value 77,000 $39.1489 $3,014,466 $796
(including associated
preferred share purchase
rights)
======================================================================
</TABLE>
(1) Calculated pursuant to Rule 457(c) under the Securities Act of
1933, based upon the price at which the options may be exercised
under the Plans. The price at which options may be exercised
ranges from $20.3125 to $41.3125, with weighted average exercise
price of $39.1489. The value attributable to the associated
preferred stock purchase rights is reflected in the value
attributable to the Common Stock.
(2) Previously paid in connection with the initial filing of this
Registration Statement.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states
that this Registration Statement will thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until
this Registration Statement shall become effective on such date as the
Commission acting pursuant to said Section 8(a) may determine.
SUBJECT TO COMPLETION - DATED AUGUST __, 2000
PROSPECTUS
ARVINMERITOR, INC.
77,000 Shares
Common Stock, $1 Par Value
ARVINMERITOR, INC. 1998 STOCK BENEFIT PLAN
This Prospectus relates to shares of common stock of
ArvinMeritor, Inc. which may be offered and sold under the
ArvinMeritor, Inc. 1998 Stock Benefit Plan to Plan participants who
ceased to be employees of Arvin and its subsidiaries on or prior to
July 7, 2000.
Our common stock is traded on the New York Stock Exchange under
the symbol "ARM". On August 1, 2000, the closing sale price of the
common stock on the New York Stock Exchange was $15.50 per share.
The mailing address and telephone number of ArvinMeritor's
principal executive offices are: 2135 West Maple Road, Troy, Michigan
48084-7186; telephone: (248) 435-1000.
This Prospectus should be retained for future reference.
__________________________________________
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities
or passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.
__________________________________________
The date of this Prospectus is August __, 2000
The information in this prospectus is not complete and may be changed.
We may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and is not
soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.
You should rely only on the information provided or incorporated by
reference in this Prospectus. The information in this Prospectus is
accurate as of the date on these documents, and you should not assume
that it is accurate as of any other date.
TABLE OF CONTENTS
PAGE
ARVINMERITOR, INC. . . . . . . . . . . . . . . . . . . . . . . . 4
WHERE YOU CAN FIND MORE INFORMATION . . . . . . . . . . . . . . . 4
PROSPECTUS FOR THE ARVINMERITOR, INC. 1998 STOCK BENEFIT PLAN . . 6
SUPPLEMENTAL INFORMATION TO THE ARVINMERITOR, INC. 1998 STOCK
BENEFIT PLAN DATED JULY, 2000 . . . . . . . . . . . . . . . . . . 6
MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
GENERAL DESCRIPTION OF PLAN . . . . . . . . . . . . . . . . 6
SHARES SUBJECT TO AWARDS UNDER THE PLAN . . . . . . . . . . 7
RIGHTS UNSECURED . . . . . . . . . . . . . . . . . . . . . . 7
FEDERAL INCOME TAX OBLIGATIONS . . . . . . . . . . . . . . . 7
REPORTS TO GRANTEES . . . . . . . . . . . . . . . . . . . . 9
ARVIN INDUSTRIES, INC. 1998 STOCK BENEFIT PLAN . . . . . . . . . 10
1. PURPOSE OF THE PLAN . . . . . . . . . . . . . . . . . . . . 10
2. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . 10
3. ADMINISTRATION OF THE PLAN . . . . . . . . . . . . . . . . . 14
4. SHARES SUBJECT TO THE PLAN . . . . . . . . . . . . . . . . . 15
5. OPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6. SPECIAL RULES RELATING TO ISOS . . . . . . . . . . . . . . . 19
7. SHARE APPRECIATION RIGHTS . . . . . . . . . . . . . . . . . 20
8. RESTRICTED SHARE AWARDS . . . . . . . . . . . . . . . . . . 24
9. PERFORMANCE SHARES AND PERFORMANCE UNITS . . . . . . . . . . 27
10. ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . . 29
11. ADJUSTMENTS . . . . . . . . . . . . . . . . . . . . . . . . 29
12. DISSOLUTION OR LIQUIDATION . . . . . . . . . . . . . . . . . 29
13. GOVERNMENT REGULATIONS . . . . . . . . . . . . . . . . . . . 30
14. TERMINATION AND AMENDMENT OF PLAN . . . . . . . . . . . . . 30
17. RIGHTS AS SHAREHOLDER . . . . . . . . . . . . . . . . . . . 31
18. LEAVES OF ABSENCE . . . . . . . . . . . . . . . . . . . . . 31
2
19. EFFECTIVE DATE . . . . . . . . . . . . . . . . . . . . . . . 31
20. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . 31
21. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . 32
22. SUCCESSORS . . . . . . . . . . . . . . . . . . . . . . . . . 32
23. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . 32
LIMITATION OF LIABILITY . . . . . . . . . . . . . . . . . . . . . 33
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . 33
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . 33
DESCRIPTION OF COMMON STOCK . . . . . . . . . . . . . . . . . . . 33
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3
ARVINMERITOR, INC.
On July 7, 2000, Arvin Industries, Inc. ("Arvin") and Meritor
Automotive, Inc. ("Meritor") merged to form a new company,
ArvinMeritor, Inc. (the "Company").
Meritor was a global manufacturer and supplier of a broad range
of components and systems for commercial, specialty and light vehicle
original equipment manufacturers and the aftermarket, with 68
manufacturing facilities located in 23 countries. Meritor had
approximately 19,000 employees engaged in manufacturing, research,
sales and administration activities at facilities located around the
world. In its fiscal year ended September 30, 1999, Meritor had total
sales of approximately $4.5 billion.
Arvin was a focused international manufacturer and supplier of
automotive parts with 53 manufacturing facilities and six technical
centers located in 16 countries, excluding non-consolidated
businesses. Arvin had approximately 17,500 employees worldwide. In
its fiscal year ended January 2, 2000, Arvin had total sales of
approximately $3.1 billion.
WHERE YOU CAN FIND MORE INFORMATION
The Company files annual, quarterly and current reports, proxy
statements and other information with the SEC. You may read and copy
any document we file at the SEC's public reference rooms in
Washington, D.C., New York, New York and Chicago, Illinois. Please
call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms. Our SEC filings are also available to the public at
the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this
prospectus the information we file with it, which means that we can
disclose important information to you by referring you to those
documents. The information incorporated by reference is considered to
be part of this prospectus, and later information that we file with
the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future
filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 until our offering is completed:
1. The Annual Report on Form 10-K of Meritor for the fiscal year
ended September 30, 1999;
2. The Quarterly Reports on Form 10-Q of Meritor for the quarterly
periods ended December 31, 1999 and March 31, 2000;
3. The Quarterly Report on Form 10-Q of the Company for the
quarterly period ended June 30, 2000;
4
4. The Current Reports on Form 8-K of Meritor dated April 14, 2000
and June 15, 2000;
5. The Current Report on Form 8-K of the Company dated July 10,
2000;
6. The description of Company's Common Stock contained in our
Registration Statement on Form S-4/A (File No. 333-35448); and
7. The description of the Company's Rights contained in the
Registration Statement on Form 8-A12B dated July 10, 2000.
You may request a copy of these filings at no cost, by writing to
or telephoning us at the following address:
ArvinMeritor, Inc.
One Noblitt Plaza, Box No. 3000
Columbus, Indiana 47202-3000
Tel: (812) 379-3000
Attn: Director, Compensation and Benefits
You should rely only on the information incorporated by reference
or provided in this prospectus. We have not authorized anyone else to
provide you with different information. We are not making an offer of
these securities in any state where the offer is not permitted. You
should not assume that the information is this prospectus is accurate
as of any date other than the date on the front of the document.
5
PROSPECTUS FOR THE ARVINMERITOR, INC. 1998 STOCK BENEFIT PLAN
The prospectus for the ArvinMeritor, Inc. 1998 Stock Benefit Plan
includes (i) the Supplemental Information to the ArvinMeritor, Inc.
1998 Stock Benefit Plan, and (ii) the Arvin Industries, Inc. 1998
Stock Benefit Plan document.
NOTE: References in the Prospectus for the Arvin Industries, Inc.
1998 Stock Benefit Plan to Arvin and Arvin common stock now refer to
the Company and the Company's Common Stock.
ARVINMERITOR, INC. 1998 STOCK BENEFIT PLAN
(formerly the Arvin Industries, Inc. 1998 Stock Benefit Plan)
SUPPLEMENTAL INFORMATION
The ArvinMeritor, Inc. 1998 Stock Benefit Plan, formerly the
Arvin Industries, Inc. 1998 Stock Benefit Plan (the "Plan"), attached
hereto, and the Supplemental Information set forth below constitute
part of a Prospectus covering securities that have been registered
under the Securities Act of 1933.
MERGER
Effective July 7, 2000, Meritor Automotive, Inc. ("Meritor") and
Arvin Industries, Inc. ("Arvin") merged to form a new company,
ArvinMeritor, Inc. (the "Company"). As a result of the merger, the
Plan was renamed the ArvinMeritor, Inc. 1998 Stock Benefit Plan.
All unvested Arvin stock options outstanding under the Plan as of
July 6, 2000, became fully vested. Each outstanding Arvin stock
option has been converted into an option to purchase a number of
shares of the Company's common stock, par value $1 per share (the
"Common Stock") equal to the number of shares of Arvin common stock
that would have been obtained before the merger upon the exercise of
the option, plus $1 cash per share. The exercise price per share of
each Company option after the merger is equal to the exercise price
per share of Arvin common stock subject to the option before the
merger. For example, if following the merger a participant exercises
an option granted under the Plan prior to the merger for 100 shares of
Arvin common stock, he will receive upon payment of the exercise price
100 shares of Company Common Stock plus $100. Except as described
above, the other terms of each Arvin option in effect prior to the
merger will continue to apply to the converted Company options.
GENERAL DESCRIPTION OF PLAN
The Plan is a stock based plan providing for the grant of
incentive stock options and nonqualified stock options ("Options"),
stock appreciation rights ("SARs"), restricted shares, performance
shares and performance units to officers and nonemployee directors.
The purpose of the Plan is to enable the Company to attract, retain,
6
and motivate officers and nonemployee directors by offering them an
opportunity to have a greater proprietary interest in and closer
identity with the Company and its financial success.
The Plan is not qualified under Section 401(a) of the Internal
Revenue Code and is not subject to the provisions of the Employee
Retirement Income Security Act of 1974.
Additional information about the Plan and its administrators is
available upon request from the Director, Compensation and Benefits,
ArvinMeritor, Inc., One Noblitt Plaza, Box No. 3000, Columbus, Indiana
47202-3000, telephone: (812) 379-3000.
SHARES SUBJECT TO AWARDS UNDER THE PLAN
The Company has registered 77,000 shares of Common Stock for
issuance under the Plan. Such shares may be either authorized but
unissued shares or treasury shares.
RIGHTS UNSECURED
No person or entity shall have any right to receive a benefit or
award under the Plan except in accordance with the Plan. The right
of a grantee or his or her beneficiary to receive a distribution under
the Plan is an unsecured claim against the general assets of the
Company and neither a grantee nor his or her beneficiary has any
rights against any specific assets of the Company.
FEDERAL INCOME TAX OBLIGATIONS
The following discussion of federal income tax obligations of
persons receiving awards under the Plan is based on the federal income
tax laws currently in effect.
OPTIONS
Under federal income tax law as currently in effect, neither
incentive stock options nor nonqualified stock options without an
ascertainable fair market value require a grantee to recognize income
at the time of grant. However, upon the exercise of a nonqualified
stock option, the grantee will recognize ordinary income in an amount
equal to the excess of the fair market value of the Common Stock
(i.e., the closing price of the Common Stock on the New York Stock
Exchange on the trading day immediately preceding the exercise date)
over the aggregate exercise price. For this purpose, the date as of
which income is recognized is the date of exercise.
With respect to an incentive stock option, no income is
recognized by the grantee in connection with the exercise, although
the excess of the fair market value of the Common Stock at exercise
over the aggregate exercise price is a tax preference item and may
lead to alternative minimum tax liability for the grantee. The
7
grantee will be subject to taxation at the time shares of Common Stock
acquired with an incentive stock option are sold. If the sale occurs
at least two years after the date the incentive stock option was
granted and at least one year after the date it was exercised, the
grantee will recognize capital gain in an amount equal to the excess
of the proceeds of the sale over the aggregate exercise price of the
Common Stock sold. If these holding period requirements are not met,
the grantee will recognize ordinary income.
The Company's tax consequences will also depend upon whether an
Option is an incentive stock option or a nonqualified stock option.
In the case of a nonqualified stock option, the Company will be
entitled to a deduction in connection with the grantee's exercise in
an amount equal to the income recognized by the grantee, provided that
the Company complies with applicable withholding requirements. If the
Option is an incentive stock option, however, the Company will not be
entitled to a deduction if the grantee satisfies the holding period
requirements and recognizes capital gain. If those requirements are
not satisfied, the Company will be entitled to a deduction
corresponding to the ordinary income recognized by the grantee.
The conversion of an Arvin option to a Company option as a result
of the merger does not result in a taxable event to the grantee, or
change the status of the option as an incentive stock option or a
nonqualified stock option. The grantee of a converted option will,
however, recognize ordinary income with respect to each $1 in cash
that is received as part of the merger consideration when the
converted option is exercised. The Company will receive a deduction
for the cash that is paid upon exercise.
SARs
SARs likewise do not require a grantee to recognize income at the
time of grant. Upon exercise of an SAR, the grantee will recognize
ordinary income in an amount equal to the excess of the fair market
value of the Common Stock on the date of exercise over the related
Option price (or the price specified in the SAR, in the case of a
"non-tandem" SAR). The Company will be entitled to a deduction in an
amount equal to the income recognized by the grantee, provided that
the Company complies with applicable withholding requirements.
RESTRICTED SHARES
At the date of a grant of restricted shares, the grantee will not
recognize income, and the Company will not be entitled to a deduction.
The grantee will realize ordinary income equal to the fair market
value of the Common Stock received when the restrictions on the Common
Stock lapse and the grantee's interest in the Common Stock is no
longer subject to a substantial risk of forfeiture. The Company may
be entitled to a deduction with respect to the ordinary income
realized by the grantee, subject to the limitations of Section 162(m)
of the Internal Revenue Code.
8
PERFORMANCE SHARES AND PERFORMANCE UNITS
At the date of a grant of performance shares or performance
units, the grantee will not recognize income, and the Company will not
be entitled to a deduction. Upon exercise, the grantee of a
performance share or performance unit will realize ordinary income
equal to the amount of cash or the fair market value of the Common
Shares received on exercise. The Company may be entitled to a
deduction with respect to the ordinary income realized by the grantee,
subject to the limitations of Section 162(m) of the Internal Revenue
Code.
THE FOREGOING IS INCLUDED ONLY AS A SUMMARY OF POSSIBLE FEDERAL
INCOME TAX CONSEQUENCES. A PERSON SHOULD CONSULT HIS OR HER TAX
ADVISOR CONCERNING MATTERS COVERED BY THIS DISCUSSION AND THE POSSIBLE
APPLICATION OF FOREIGN, STATE AND LOCAL TAX LAWS.
REPORTS TO GRANTEES
The Company has filed a Registration Statement on Form S-3 (the
"Registration Statement") with the Securities and Exchange Commission
covering up to 77,000 shares of Common Stock to be offered and sold
under the Plan to Plan participants who ceased to be employees of
Arvin and its subsidiaries on or prior to July 7, 2000.
The Company will provide, without charge, to each person eligible
to participate in the Plan, upon written or oral request, (i) a copy
of any of the documents which are incorporated by reference in the
Registration Statement, other than the exhibits to such documents
(unless such exhibits are specifically incorporated by reference into
the information that the Registration Statement incorporates) and (ii)
a copy of its Annual Report to Shareholders for its most recent fiscal
year. The documents incorporated by reference in the Registration
Statement are hereby specifically incorporated by reference in this
Prospectus. Requests for copies of such documents should be directed
to the Director, Compensation and Benefits, ArvinMeritor, Inc., One
Noblitt Plaza, Box No. 3000, Columbus, Indiana 47202-3000, telephone:
(812) 379-3000.
7/2000
9
NOTE: REFERENCES IN THE ARVIN INDUSTRIES, INC. 1998 STOCK BENEFIT
PLAN TO ARVIN AND ARVIN COMMON STOCK NOW REFER TO THE
COMPANY AND THE COMPANY'S COMMON STOCK.
ARVIN INDUSTRIES, INC.
1998 STOCK BENEFIT PLAN
1. PURPOSE OF THE PLAN
This Plan is intended to benefit the Corporation and its
subsidiaries by providing compensation arrangements that may be used
to attract, retain and reward Officers and Nonemployee Directors of
training, experience and ability, to attract new Officers and
Nonemployee Directors whose services are considered valuable, and to
provide such persons with a proprietary interest in and a greater
concern for the welfare of the Corporation and its subsidiaries.
2. DEFINITIONS
Whenever used herein, the following words and phrases shall (for
purposes of this Plan and this Plan only) have the meanings stated
unless a different meaning is plainly required by the context:
(a) "Award" means a grant, pursuant to the Plan, of Options,
SARs, Performance Shares, Performance Units, Restricted
Shares, or any combination thereof.
(b) "Board" means the board of directors of the Corporation.
(c) "Cause" means (A) the willful and continued failure by a
Participant to substantially perform his duties with the
Corporation or its subsidiaries (other than any such failure
resulting from his Disability) after a written demand for
substantial performance is delivered to him by the
Corporation that specifically identifies the manner in which
the Participant has not substantially performed his duties,
or (B) the willful engaging by the Participant in gross
misconduct materially and demonstrably injurious to the
Corporation or its subsidiaries. No act, or failure to act,
on the Participant's part shall be considered "willful"
unless done, or omitted to be done, by him not in good faith
and without reasonable belief that his action or omission
was in the best interest of the Corporation and its
subsidiaries.
(d) "Change of Control," for purposes of the Plan, means:
(i) the acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) (a "Person") of beneficial ownership
10
(within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (A) the then
outstanding Common Shares of the Corporation (the
"Outstanding Corporation Common Shares") or (B) the
combined voting power of the then outstanding voting
securities of the Corporation entitled to vote
generally in the election of directors (the
"Outstanding Corporation Voting Securities"); provided,
however, that for purposes of this subsection (i), the
following acquisitions shall not constitute a Change of
Control: (w) any acquisition directly from the
Corporation, (x) any acquisition by the Corporation,
(y) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the
Corporation or any corporation controlled by the
Corporation or (z) any acquisition by any corporation
pursuant to a transaction which complies with clauses
(A), (B) and (C) of subsection (iii) of this definition
of Change of Control; or
(ii) individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided,
however, that any individual becoming a director
subsequent to the date hereof whose election, or
nomination for election by the Corporation's
shareholders, was approved by a vote of at least a
majority of the directors comprising the Incumbent
Board as of the date hereof shall be considered as
though such individual were a member of the Incumbent
Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as
a result of an actual or threatened election contest
with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the
Board; or
(iii) consummation of a reorganization, merger or
consolidation or sale or other disposition of all
or substantially all of the assets of the
Corporation (a "Business Combination"), in each
case, unless, following such Business Combination,
(A) all or substantially all of the individuals
and entities who were the beneficial owners,
respectively, of the Outstanding Corporation
Common Shares and Outstanding Corporation Voting
Securities immediately prior to such Business
Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the
then outstanding Common Shares and the combined
voting power of the then outstanding voting
11
securities entitled to vote generally in the
election of directors, as the case may be, of the
corporation resulting from such Business
Combination (including, without limitation, a
corporation which as a result of such transaction
owns the Corporation or all or substantially all
of the Corporation's assets either directly or
through one or more subsidiaries) in substantially
the same proportions as their ownership,
immediately prior to such Business Combination of
the Outstanding Corporation Common Shares and
Outstanding Corporation Voting Securities, as the
case may be, (B) no person (excluding any
corporation resulting from such Business
Combination or any employee benefit plan (or
related trust) of the Corporation or such
corporation resulting from such Business
Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then
outstanding Common Shares of the corporation
resulting from such Business Combination or the
combined voting power of the then outstanding
voting securities of such corporation except to
the extent that such ownership existed prior to
the Business Combination and (C) at least a
majority of the members of the board of directors
of the corporation resulting from such Business
Combination were members of the Incumbent Board at
the time of the execution of the initial
agreement, or of the action of the Board,
providing for such Business Combination; or
(iv) approval by the shareholders of the Corporation of a
complete liquidation or dissolution of the Corporation.
(e) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
(f) "Committee" means the Human Resources Committee of the Board
or any other committee designated by the Board.
(g) "Common Shares" means the Corporation's common shares, par
value $2.50 per share, together with one Right for each
Common Share to purchase one one-hundredth of a share of the
Corporation's Series C Junior Participating Preferred
Shares, without par value, issuable prior to the
Distribution Date pursuant to the Rights Agreement.
(h) "Corporation" means Arvin Industries, Inc., an Indiana
corporation.
12
(i) "Disability" means a physical or mental condition that
renders a Participant unable to perform his usual duties or
any comparable duties for the Corporation or its
subsidiaries if, in the opinion of a physician selected by
the Corporation, such condition will continue indefinitely
or for a substantial period of time.
(j) "Distribution Date," for purposes of the Plan, shall have
the meaning given in the Rights Agreement.
(k) "Fair Market Value" means (i) if the Common Shares are
listed on the New York Stock Exchange, the closing price of
the Common Shares on the consolidated tape of the New York
Stock Exchange on the relevant date or the most recent date
on which Common Shares traded on such Exchange; and (ii) if
the Common Shares are not listed on such Exchange, such
value as the Committee, in good faith, shall determine.
Notwithstanding any provision of the Plan to the contrary,
no determination made with respect to the Fair Market Value
of Common Shares subject to an ISO shall be inconsistent
with Section 422A of the Code or regulations thereunder.
(1) "ISO" means an incentive stock option, within the meaning of
Section 422A of the Code, granted under the Plan pursuant to
Sections 5 and 6.
(m) "Limited Right" means a limited stock appreciation right
granted under the Plan pursuant to Section 7.
(n) "Nonemployee Directors" means any member of the Board who is
not employed by the Corporation or any one of its
subsidiaries.
(o) "Non-tandem SAR" means an SAR not granted in connection with
an Option.
(p) "Officer" means any officer of the Corporation elected by
the Board who is employed on a full-time salaried basis.
(q) "Option" means an option, including an ISO, granted under
the Plan pursuant to Section 5.
(r) "Option Agreement" means a written agreement specifying the
type of Option granted, the price at which the Option shall
be exercisable, the duration of the Option, the number of
Common Shares to which the Option pertains and such other
provisions as the Committee shall determine.
(s) "Participant" means any Officer who has been selected by the
Committee to receive an Award.
13
(t) "Performance Share" means a performance share granted under
the Plan pursuant to Section 9.
(u) "Performance Unit" means a performance unit granted under
the Plan pursuant to Section 9.
(v) "Plan" means the Arvin Industries, Inc. 1998 Stock Benefit
Plan.
(w) "Restricted Share" means a restricted share granted under
the Plan pursuant to Section 8.
(x) "Restricted Share Agreement" means a written agreement
governing the issuance of a Restricted Share or Shares.
(y) "Retirement Age" means the age at which employment is
terminated or benefits are paid as a result of the
attainment of the normal or early retirement age as defined
in the retirement plan sponsored by the Corporation or one
of its subsidiaries in which the Participant is actively
participating.
(z) "Rights Agreement" means the Rights Agreement dated as of
May 29, 1986, between the Corporation and Harris Trust and
Savings Bank, as amended by Amendments No. 1, 2 and 3
thereto, dated February 23, 1989, November 10, 1994 and May
10, 1996, respectively, as such agreement may be further
amended from time to time.
(aa) "SAR" means a stock appreciation right granted under the
Plan pursuant to Section 7.
(bb) "SAR Agreement" means a written agreement evidencing the
terms and conditions applicable to an SAR.
(cc) "Tandem SAR" means an SAR granted in connection with an
Option.
3. ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Committee, which shall
consist of two or more directors who shall be appointed by the Board,
all of whom shall not be (or formerly have been) employees of the
Corporation. The Committee shall, within the limits and pursuant to
the terms of the Plan, determine the individuals to whom Awards are to
be granted under the Plan, the number of shares to be subject to each
Award, the exercise price with respect to each Option, the base price
with respect to each SAR, the restrictions to be imposed on Restricted
Shares, the performance goals which must be met in order to earn each
Performance Share and each Performance Unit, and all other terms and
conditions of such Awards and the shares to be issued pursuant to the
Plan. The Committee is also authorized to interpret any provision of
14
the Plan, to adopt, amend and rescind rules, regulations, terms and
agreements relating to the Plan, Awards granted thereunder and the
shares to be issued pursuant thereto, and to make all other
determinations and take all other action that it deems necessary to
advisable for the administration of the Plan. The Committee is also
authorized to provide and accept any notices provided for hereunder.
Action with respect to the Plan may be taken by a majority of the
members of the Committee then in office either at a meeting called by
any member of the Committee or by unanimous written consent.
4. SHARES SUBJECT TO THE PLAN
(a) COMMON SHARES AVAILABLE FOR DELIVERY. Subject to the Section
11 and the following provisions of this Section 4, the maximum number
of Common Shares that may be subject to Awards (excluding Awards which
are Tandem SARs) shall be equal to the sum of (i) 1,200,000 Common
Shares; (ii) any Common Shares available for future awards under the
1988 Stock Benefit Plan (the "1988 Plan") as of the Effective Date (as
determined pursuant to Section 19); and (iii) any Common Shares that
are represented by awards granted under the 1998 Plan which are
forfeited, expire or are canceled without delivery of Common Shares or
which result in the forfeiture of Common Shares back to the
Corporation.
In the event that, prior to the expiration date of the Plan, any
Option granted under the Plan expires unexercised or is terminated,
surrendered or canceled (other than in connection with the exercise of
an SAR) without being exercised, in whole or in part, for any reason,
any Non-tandem SAR granted under the Plan expires unexercised or is
terminated, surrendered or canceled without being exercised, in whole
or in part, for any reason, any Restricted Shares granted under the
Plan are forfeited or reacquired by the Corporation in connection with
the restrictions imposed upon such Common Shares pursuant to the Plan,
or any Performance Share or Performance Unit distributable as Common
Shares is unearned, terminated, surrendered, canceled or forfeited,
then the number of Common Shares theretofore subject to such Option,
SAR, Performance Share, or Performance Unit or constituting such
Restricted Shares, or the unexercised, terminated, surrendered,
forfeited, canceled or reacquired portion thereof, shall be added to
the remaining number of Common Shares that may be made subject to
Awards under the Plan. If either the purchase price of Common Shares
upon exercise of any Option or the tax withholding requirement is
satisfied by tendering or withholding Common Shares or by tendering
exercisable Options, only the number of Common Shares issued net of
the Common Shares tendered or withheld shall be deemed delivered for
purposes of determining the number of Common Shares available for
Awards under the Plan.
(b) OTHER PLAN LIMITS. Subject to Section 11, the following
additional maximums are imposed under the Plan:
15
(i) The maximum number of Common Shares that may be issued
as ISOs shall be 1,200,000 Common Shares.
(ii) The maximum number of Common Shares that may be covered
by Awards granted to any one Participant pursuant to
Section 5 (Options) shall be 200,000 Common Shares
during any calendar year.
(iii) The maximum number of Common Shares that may be
covered by Awards granted to any one Participant
pursuant to Section 8 (Restricted Share Awards)
and Section 9 (Performance Shares and Performance
Units) shall be 25,000 Common Shares during any
calendar year.
5. OPTIONS
(a) Options may be granted to Participants at any time and from
time to time as shall be determined by the Committee. The
Committee shall have complete discretion in determining the
number of Common Shares subject to Options granted to each
Participant. The Committee may grant any type of Option to
purchase Common Shares that is permitted by law at the time
of the grant, including ISOs. Unless otherwise expressly
provided at the time of grant, Options granted under the
Plan will be nonqualified stock options.
(b) Each Nonemployee Director shall be granted automatically an
Option (that is not an ISO) to purchase 1,000 Common Shares,
on the day following each annual meeting of the Board held
on or after each Annual Meeting of Shareholders. The per
share exercise price of each option to be paid by each
Nonemployee Director shall be 100% of the Fair Market Value
of the Common Shares on the date an Option is granted.
(c) Each Option shall be evidenced by an Option Agreement.
(d) Except as provided in Sections 6 and 11 below, the number of
Common Shares subject to Options to be granted to each
Participant and the price per share to be paid by each
Participant upon exercise shall be determined by the
Committee at the time the Options are granted, provided that
such exercise price shall not be less than 100% of the Fair
Market Value of the Common Shares on the date an Option is
granted or the par value of the Common Shares, whichever is
greater.
(e) Except as provided in Section 6 and subject to earlier
termination as provided in subsections (f) and (g) hereof,
an Option granted under the Plan shall expire on the date
determined by the Committee at the time the Option is
granted, provided that such date shall not be more than ten
16
years from the date the Option is granted. The Committee
shall specify in the Option Agreement, at the time each
Option is granted, the time or times at which, and in what
proportions, the Option may be exercised prior to its
expiration or earlier termination. The Committee, in its
discretion, shall have the power to accelerate the
exercisability of any or all Options, or any part thereof,
granted under the Plan.
(f) Except as otherwise provided in this subsection (f), no
Option may be exercised by a Participant at any time unless
the Participant is then a salaried full-time employee of the
Corporation or one of its subsidiaries. The Options of any
Participant whose full-time salaried employment with the
Corporation and its subsidiaries is terminated by the
Corporation without Cause (except in connection with a
Disability) shall expire on the earlier of (i) three months
after such termination, or (ii) the date that such Options
expire in accordance with their terms. During such period,
the Options may be exercised by such Participant with
respect to the same number of shares and in the same manner
and to the same extent as if the Participant had continued
as a full-time salaried employee of the Corporation or one
of its subsidiaries during such period. In the event that a
Participant voluntarily terminates employment with the
Corporation and its subsidiaries (except in connection with
a Disability or after attainment of Retirement Age) or is
discharged by the Corporation or one of its subsidiaries for
Cause, any Option or Options held by the Participant under
the Plan and not previously exercised shall expire
immediately upon such termination or discharge and may not
be exercised thereafter. The Options of any Participant
whose full-time salaried employment with the Corporation and
its subsidiaries is terminated in connection with attainment
of Retirement Age shall expire upon the earlier of five
years after such termination or the date such Options expire
in accordance with their terms. During such period, the
Options may be exercised by the Participant with respect to
the same number of shares and in the same manner and to the
same extent as if the Participant had continued as a full-
time salaried employee of the Corporation or one of its
subsidiaries during such period. The Options of any
Participant whose full-time salaried employment with the
Corporation and its subsidiaries is terminated by Disability
or death shall expire upon the earlier of one year after
such Disability or death, or the date such Options expire in
accordance with their terms. During such period the Options
may be exercised by the Participant, or in the event of his
death by a legatee or legatees of the Options under the
Participant's will or by his executors, personal
representatives or distributees, with respect to the number
17
of shares that the Participant could have purchased on the
date of his Disability or death, as the case may be.
(g) Except as otherwise provided in this subsection (g), no
Option may be exercised by a Nonemployee Director at any
time unless the Nonemployee Director is then a member of the
Board. The Options held by any Nonemployee Director under
the Plan and not previously exercised whose membership on
the Board is terminated for any reason other than death
shall expire immediately upon such termination and may not
be exercised thereafter. The Options of any Nonemployee
Director whose membership on the Board is terminated by
death shall expire upon the earlier of one year after such
death or the date such Options expire in accordance with
their terms. In the event of death, the Options may be
exercised by a legatee or legatees of the Options under the
Nonemployee Director's will or by his executors, personal
representatives or distributees.
(h) Options granted under the Plan shall be exercisable at such
times and be subject to such restrictions and conditions as
the Committee shall in each instance approve at the time the
Options are granted, which restrictions and conditions need
not be the same for all Participants; provided, however,
that ISOs shall comply with the applicable provisions of the
Code pertaining thereto. The Committee may specify a minimum
number of full shares that must be purchased by a
Participant or Nonemployee Director upon any exercise of an
Option granted to him under the Plan. Notwithstanding any
other restriction on exercisability approved by the
Committee, an Option granted under the Plan shall be fully
exercisable upon a Change of Control of the Corporation or
as of the Distribution Date.
(i) The purchase price of Common Shares upon exercise of any
Option shall be paid in full either (i) in cash or (ii) in
Common Shares valued at their Fair Market Value on the day
before the date of exercise, (iii) by delivery of a
promissory note of the Participant, (iv) in cash by a
broker-dealer to whom the holder of the Option has submitted
an exercise notice consisting of a fully endorsed Option,
(v) by agreeing to surrender Options then exercisable by him
valued at the excess of the aggregate Fair Market Value of
the Common Shares subject to such Options on the date of
exercise over the aggregate option price of such Common
Shares, (vi) by directing the Corporation to withhold such
number of Common Shares otherwise issuable upon exercise of
such Option having an aggregate Fair Market Value on the
date of exercise equal to the exercise price of the Option,
or (vii) by any combination of (i), (ii), (iii), (iv), (v)
and (vi), if approved by the Committee in its discretion or
in the manner provided in the Option Agreement. Subject to
18
Section 15, the Corporation shall issue, in the name of the
Participant, certificates representing the total number of
Common Shares purchased pursuant to the exercise of any
Option in a timely manner after such exercise.
(j) At the time of grant of an Option, the Committee may impose
such restrictions on disposition of Common Shares acquired
upon the exercise of such Option as it deems appropriate,
which restrictions may, without limitation, include a right
in the Corporation to repurchase upon the occurrence of a
specified event or events, all or any of such shares at the
price not less than the exercise price paid by the
Participant or Nonemployee Director for those shares.
(k) Any Option granted under the Plan may be exercised by the
Participant or Nonemployee Director, by a legatee or
legatees of such Option under the Participant's or
Nonemployee Director's will, or by his executors, personal
representatives or distributees, by delivering to the
Corporation at its principal executive office (attention of
its Secretary) written notice of the number of Common Shares
with respect to which the Option is being exercised
accompanied either by payment or instructions regarding
payment in accordance with subsection (i) above. The date of
exercise shall be the date the notice is received by the
Corporation, unless a later date is specified in such
notice. Notwithstanding the foregoing, if an exercise notice
is received by the Corporation within ten days following the
Distribution Date, such exercise shall be effective as of
the day immediately preceding the Distribution Date unless a
later date is specified in the notice.
(1) As of the effective date of a merger, consolidation or share
exchange involving the Corporation as a result of which
Common Shares are converted into the right to receive
another security and/or any other consideration, each Option
shall automatically become an option to acquire the
securities and/or other consideration that a holder of the
number of Common Shares then subject to the Option would
have become entitled to receive as a result of such merger,
consolidation or share exchange. Such converted option shall
be governed by the terms and conditions applicable to the
Option.
(m) The Committee may prescribe such other terms and conditions
of the Options granted under the Plan that are neither
inconsistent with nor prohibited by the Plan.
6. SPECIAL RULES RELATING TO ISOS
Notwithstanding anything in Section 5 to the contrary, ISOs shall
be in such form and upon such terms and conditions as the Committee
19
shall from time to time determine, subject to the following to the
extent necessary to comply with Section 422A of the Code:
(a) An ISO must be granted within ten years from the date the
Plan is adopted or the date the Plan is approved by the
shareholders of the Corporation, whichever is earlier;
(b) The aggregate Fair Market Value (determined at the time the
ISOs are granted) of the Common Shares with respect to which
ISOs are exercisable for the first time by a Participant
during any calendar year (under all plans of the Corporation
and its subsidiaries) shall not exceed $100,000; and
(c) Notwithstanding any other provision herein contained, no
Participant may receive an ISO under the Plan if such
Participant, at the time the ISO is granted, owns shares
possessing more than ten percent of the total combined
voting power of all classes of shares of the Corporation or
of its parent or subsidiary corporation (within the
contemplation of Section 425(d) of the Code); provided,
however, that such Participant shall be eligible to receive
a grant of an ISO if, at the time such ISO is granted, the
exercise price is at least 110% of the Fair Market Value of
Common Shares, and such ISO is not exercisable after the
expiration of five years from the date such ISO is granted.
7. SHARE APPRECIATION RIGHTS
(a) SARs may be granted to Participants at any time and from
time to time as shall be determined by the Committee. The
Committee may specify that an SAR granted under the Plan
shall be a Tandem SAR or a Non-tandem SAR. An SAR granted to
a Participant at the same time and covering the same number
of Common Shares as an Option shall be a Tandem SAR unless
the Committee specifies to the contrary. At the time of
grant of a Non-tandem SAR, the Committee shall specify the
base price of Common Shares to be used in connection with
the calculation described in subsection (c) below and the
number of Common Shares subject to the SAR. The base price
of a Non-tandem SAR shall not be less than 100% of the Fair
Market Value of one Common Share on the date of grant. No
Tandem SAR may be granted to a Participant in connection
with an ISO in a manner that will disqualify the ISO under
Section 422A of the Code unless the Participant consents
thereto.
(b) Each SAR shall be evidenced by an SAR Agreement.
(c) An SAR shall entitle the Participant to receive from the
Corporation the number of Common Shares having an aggregate
Fair Market Value equal to:
20
(i) In the case of a Tandem SAR, all, or if specified by
the Committee at the time of grant, some portion, of
the excess of the Fair Market Value of one Common Share
as of the date on which the SAR is exercised over the
Option price per share specified in such Option,
multiplied by the number of shares then subject to the
Option, or the portion thereof as to which the SAR is
being exercised; or
(ii) In the case of a Non-tandem SAR, all, or if specified
by the Committee at the time of grant, some portion or
multiple, of the excess of the Fair Market Value of one
Common Share as of the date on which the SAR is
exercised over the base price specified in such SAR,
multiplied by the number of Common Shares then subject
to the SAR, or the portion thereof as to which it is
being exercised.
Cash shall be delivered in lieu of any fractional shares.
The Corporation shall be entitled to elect to settle any
part or all of its obligation arising out of the exercise of
an SAR by the payment of cash in lieu of all or part of the
Common Shares it would otherwise be obligated to deliver in
an amount equal to the Fair Market Value of such shares.
(d) A Tandem SAR shall be exercisable at the time and to the
extent, but only at such time and to such extent, that the
Option to which it relates is exercisable. Upon the exercise
of a Tandem SAR, the unexercised Option or portion thereof,
to which the exercised portion of the Tandem SAR is related
shall expire. The exercise of any Option shall cause the
expiration of the Tandem SAR related to such Options, or
portion thereof, that is exercised.
(e) (i) Non-tandem SARs granted under the Plan shall be
exercisable at such times and be subject to such
restrictions and conditions as the Committee shall in
each instance approve at the time the Non-tandem SARs
are granted, which restrictions and conditions need not
be the same for all Participants. The Committee may
specify a minimum number of full shares with respect to
which any exercise of a Non-tandem SAR must be made.
Notwithstanding any other restriction on exercisability
approved by the Committee, a Non-tandem SAR granted
under the Plan shall be fully exercisable upon a Change
of Control of the Corporation or as of the Distribution
Date.
(ii) Subject to earlier termination as provided in the last
sentence of this paragraph (ii), a Non-tandem SAR
granted under the Plan shall expire on the date
determined by the Committee, provided that such date
21
shall not be more than ten years from the date the SAR
is granted. The Committee shall specify at the time
each Non-tandem SAR is granted, the time or times at
which, and in what proportions, the Non-tandem SAR may
be exercised prior to its expiration or earlier
termination. The Committee, in its discretion, shall
have the power to accelerate the exercisability of any
or all Non-tandem SARs, or any part thereof, granted
under the Plan. Notwithstanding the foregoing, any Non-
tandem SAR granted to a Participant under the Plan
shall expire following a termination of his full-time
salaried employment with the Corporation and its
subsidiaries in the same manner as an Option held by
such Participant would expire pursuant to the
provisions of subsection 5(e).
(f) Any SAR granted under the Plan may be exercised by the
Participant, by a legatee or legatees of such SAR under the
Participant's last will, or by his executors, personal
representatives or distributees, by delivering to the
Corporation at its principal executive office (attention of
its Secretary) written notice of the number of Common Shares
with respect to which the SAR is being exercised accompanied
by any related SAR Agreement and, in the case of a Tandem
SAR, by the related Option Agreement. The date of exercise
shall be the date the notice is received by the Corporation,
unless a later date is specified in such notice.
Notwithstanding the foregoing, if an exercise notice is
received by the Corporation within ten days following the
Distribution Date, such exercise shall be effective as of
the day immediately preceding the Distribution Date unless a
later date is specified in the notice.
(g) Subject to Section 15, the Corporation shall, in a timely
manner, (i) issue, in the name of the Participant,
certificates representing the total number of Common Shares
to which the Participant is entitled pursuant to subsection
(c) hereof, and (ii) if the Corporation elects to settle all
or part of its obligations arising out of the exercise of
the SAR in cash, deliver to the Participant an amount in
cash equal to the Fair Market Value of the Common Shares it
would otherwise be obligated to deliver.
(h) On or after the effective date of a merger, consolidation or
share exchange involving the Corporation as a result of
which Common Shares are converted into the right to receive
another security and/or any other consideration, each SAR
shall, upon exercise in accordance with its terms, entitle
the Participant to receive from the Corporation an amount of
such security and/or other consideration (in the proportions
received by the holders of Common Shares in the merger,
22
consolidation or share exchange) having an aggregate Fair
Market Value equal to:
(i) In the case of a Tandem SAR, all, or if specified by
the Committee at the time of grant pursuant to
paragraph (c)(i) of this Section, some portion, of the
excess of the Fair Market Value (as of the date of
exercise) of the security and/or other consideration
(on a per share basis) received by the holders of
Common Shares in the merger, consolidation or share
exchange over the option price per share specified in
the related option multiplied by the number of shares
then subject to the option, or portion thereof as to
which the SAR is being exercised; or
(ii) In the case of a Non-tandem SAR, all, or if specified
by the Committee at the time of grant pursuant to
paragraph (c)(ii) of this Section, some portion or
multiple, of the excess of the Fair Market Value as of
the date of exercise of the security and/or other
consideration (on a per share basis) received by the
holders of Common Shares in the merger, consolidation
or share exchange, over the base price specified in
such SAR multiplied by the number of shares then
subject to the SAR, or portion thereof, as to which it
is being exercised.
Cash shall be delivered in lieu of fractional securities and
may be delivered if elected by the Corporation.
(i) The Committee may specify that an SAR granted under the Plan
shall be a Limited Right. Limited Rights shall, in addition
to or in lieu of the provisions regarding exercisability
described in subsection (c) above (as specified by the
Committee), be subject to one or both of the following (as
specified by the Committee):
(i) Limited Rights shall be exercisable within thirty days
after a Change of Control, and upon exercise shall
entitle the holder to receive from the Corporation a
cash payment equal to the number of Common Shares
subject to the related Option ( the case of a Tandem
SAR) or subject to the SAR (in the case of a Non-tandem
SAR) times the greater of (A) the excess of the Fair
Market Value of one Common Share as of the date on
which the Limited Right is exercised, over the Option
price per share (in the case of a Tandem SAR) or the
base price per share (in the case of a Non-tandem SAR),
or (B) the excess of the value (as determined by the
Committee as in existence immediately prior to the
Change of Control) of the highest per share
consideration received by shareholders of the
23
Corporation in connection with the Change of Control
over such per share price.
(ii) In the event of a dissolution or liquidation of the
Corporation, Limited Rights shall be exercisable for
the thirty days prior to the effective date of such
dissolution or liquidation, and, in the absence of
exercise during such period, shall be automatically
exercised on the last business day immediately prior to
such effective date, unless both the Committee and the
Participant agree in writing that the Limited Right
shall not be exercised at that time. Upon exercise of a
Limited Right pursuant to this paragraph (ii), the
holder shall be entitled to receive from the
Corporation a cash payment equal to the number of
Common Shares subject to the related Option (in the
case of a Tandem SAR) or subject to the SAR (in the
case of a Non-tandem SAR), multiplied by the greater of
(A) the excess of the Fair Market Value of one Common
Share as of the date on which the Limited Right is
exercised, over the Option price per share (in the case
of a Tandem SAR) or the base price per share (in the
case of a Non-tandem SAR), or (B) the excess of the
value (as determined by the Committee as in existence
immediately prior to the dissolution or liquidation) of
the per share consideration received by shareholders of
the Corporation in connection with the dissolution or
liquidation over such per share price.
On or after the effective date of a merger, consolidation,
or share exchange involving the Corporation which does not
constitute a Change of Control, but which results in the
holders of Common Shares receiving another security and/or
other consideration, the cash payments contemplated by this
subsection shall be computed with reference to such security
and/or other consideration in a manner consistent with
subsection (h) above. Except as provided in subsection (c)
of this Section and in this subsection (i), a Limited Right
shall be subject to the same terms and conditions as other
SARs.
(j) The Committee may prescribe such other terms and conditions
of all SARs granted. under the Plan that are neither
inconsistent with nor prohibited by the Plan.
8. RESTRICTED SHARE AWARDS
The Committee may from time to time grant, or sell for such
amount of cash, Common Shares or such other consideration as the
Committee deems satisfactory (which amount may be less than Fair
Market Value), Restricted Shares under the Plan to such Participants
24
and upon such terms and conditions as the Committee may determine at
the time of grant or sale, subject to the following:
(a) Restricted Shares issued under the Plan shall be governed by
a Restricted Share Agreement in such form as the Committee
shall from time to time determine.
(b) Subject to Section 15 hereof, the Corporation shall issue,
in the name of the Participant, certificates representing
the total number of Restricted Shares granted or sold to the
Participant, in a timely manner after such grant or sale.
(c) Subject to the provisions of subsection (d) hereof and the
restrictions set forth in the related Restricted Share
Agreement, the Participant acquiring Restricted Shares shall
thereupon be a shareholder with respect to all of the shares
represented by such certificate or certificates and shall
have the right of a shareholder with respect to such shares,
including the right to vote such shares and to receive
dividends and other distributions paid with respect to such
shares.
(d) Any Restricted Share granted to a Participant pursuant to
the Plan shall be forfeited and any Restricted Share sold to
a Participant pursuant to the Plan shall, at the
Corporation's option, be resold to the Corporation for an
amount equal to the value of the consideration paid therefor
and, upon such forfeiture or resale, such share shall revert
to the Corporation if the Participant's employment with the
Corporation and its subsidiaries terminates prior to a date
specified by the Committee at the time of grant or sale,
which date shall not be earlier than the first anniversary
of such grant or sale, unless such employment terminates (A)
after the Participant's attainment of Retirement Age, (B)
because of the Participant's Disability, (C) because of the
Participant's death, or (D) following a Change of Control
for any reason other than Cause. As of such specified date,
or, if earlier, the Participant's date of termination of
employment described in (A) through (D) of the preceding
sentence, the restrictions of this subsection (d) shall
lapse. The Corporation may exercise its right to require a
resale of a Restricted Share pursuant to this subsection by
notice to the Participant at any time within the thirty-day
period following his termination of employment with the
Corporation and its subsidiaries. A Participant who has
received such notice shall promptly surrender his Restricted
Shares and the Corporation shall make payment therefor
within ten days after such surrender. The Committee, in its
discretion, shall have the power to accelerate the date on
which the restrictions of this subsection (d) shall lapse
with respect to any or all Restricted Shares granted or sold
25
under the Plan that have been outstanding for at least one
year.
(e) Except as set forth in subsection (f), Restricted Shares
issued pursuant to the Plan shall not be sold, assigned,
pledged or otherwise transferred, voluntarily or
involuntarily, by the holder thereof until the date the
restrictions of subsection (d) lapse. Each certificate
evidencing Restricted Shares issued under the Plan shall
bear a legend indicating that transferability of such shares
is restricted by and subject to the terms and conditions
imposed under the Plan.
(f) Notwithstanding anything contained herein to the contrary:
(i) Restricted Shares may be tendered in response to a
tender offer for or a request or invitation to tenders
of (both within the meaning of Section 14 of the
Securities Exchange Act of 1934, as in effect on
February 1, 1998) greater than 50% of the outstanding
Common Shares of the Corporation; provided the security
and/or other consideration received in exchange
therefor shall thereafter be subject to the
restrictions and conditions applicable to such
Restricted Shares until they lapse pursuant to the Plan
or the related Restricted Share Agreement and that the
tendering Participant agrees to any reasonable
provisions requested by the Corporation to assure that
any consideration received as a result of such tender
is subject to such restrictions and conditions and that
the consideration cannot be transferred in violation of
any such restrictions and conditions;
(ii) Restricted Shares may be surrendered in a merger,
consolidation or share exchange involving the
Corporation provided that the security and/or other
consideration received in exchange therefor shall
thereafter be subject to the restrictions and
conditions applicable to such Restricted Shares until
they lapse pursuant to the Plan or the related
Restricted Share Agreement and that the surrendering
Participant agrees to any reasonable provisions
requested by the Corporation to assure that any
consideration received as a result of such surrender is
subject to such restrictions and conditions and that
the consideration cannot be transferred in violation of
any such restrictions and conditions.
(g) The Committee may prescribe such other terms and conditions
of the Restricted Shares issued under the Plan that are
neither inconsistent with nor prohibited by the Plan
26
including, without limitation, terms providing for a lapse
of the restrictions of subsection (d) in installments.
(h) From and after the Distribution Date, each Rights
Certificate issued pursuant to the Rights Agreement for each
Restricted Share and all Series C Junior Participating
Preferred Shares issued upon exercise of the Rights
evidenced by such Rights Certificate shall be subject to
such restrictions and conditions applicable to such
Restricted Share until they lapse pursuant to the Plan or
the related Restricted Share Agreement; provided, however,
that the Participant holding such Rights Certificate shall
be entitled to surrender the Rights Certificate pursuant to
the terms of the Rights Agreement in exchange for the Series
C Junior Participating Preferred Shares issuable in respect
thereof.
9. PERFORMANCE SHARES AND PERFORMANCE UNITS
The Committee may from time to time grant Performance Shares or
Performance Units to such Participants and upon such terms and
conditions as the Committee shall determine, subject to the following:
(a) Each Performance Share shall represent one Common Share and
shall be earned upon the attainment of performance goals
established by the Committee at the time of grant. Each
Performance Unit shall represent the Fair Market Value of a
Common Share as of the date of such award and shall be
earned upon the attainment of performance goals established
by the Committee at the time of grant. The time period
during which the performance goals must be met shall be
determined by the Committee and shall be called a
"performance period." The Committee may provide that a
Participant will earn a specified portion of the Performance
Shares or Performance Units for a performance period in the
event that performance goals for such performance period are
partially attained.
(b) As of the last day of a performance period, Performance
Shares and Performance Units earned by a Participant for
such period shall be credited to an account (the "Account")
established and maintained for such Participant, and any
unearned - Performance Shares or Performance Units shall be
forfeited. When the Corporation pays a cash dividend on
Common Shares, each Participant's Account shall also be
credited with the amount of any cash dividends that would
have been paid on the number of Common Shares equal to the
number of Performance Shares then credited to such Account.
The Committee may provide that Performance Units credited to
an Account shall be credited with earnings at a rate
determined by the Committee. The Account of any Participant,
which shall be the record of Performance Shares earned by
him under the Plan, dividends paid thereon, Performance
Units earned by him under the Plan and earnings credited
thereon, is solely for accounting purposes and shall not
require a segregation of any Corporation assets.
27
(c) The Committee may provide at the time of grant that any
earned Performance Share in Account of a Participant, the
amount of cash dividends credited with respect thereto, any
Performance Units in an Account of a Participant, and earnings
credited with respect thereto (as well as Performance Shares
or Performance Shares or Performance Units for performance
periods then in progress) shall be forfeited if the Partici-
pant's employment with the Corporation and its subsidiaries
terminates prior to a date specified by the Committee at the
time of grant, unless such employment terminates (i) because
of death, (ii) because of Disability, (iii) after attainment
of Retirement Age, or (iv) following a Change of Control for
any reason other than Cause. The Committee may provide that,
with respect to a termination described in (i) through (iv)
of the prior sentence, a participant shall earn all or a
portion of the Performance Shares or Performance Units granted
to him for the performance period then in progress.
(d) As of the earlier of (i) the date specified by the Committee
as referred to in subsection (c) above, or (ii) the date of
a termination of employment described in paragraphs (c)(i)
through (iv) above, a Participant, with respect to
Performance Shares, shall be entitled to receive from the
Corporation either a number of Common Shares equal to the
number of Performance Shares in his Account, or cash in an
amount equal to the number of Performance Shares in his
Account times the Fair Market Value of one Common Share on
such date, and with respect to Performance Units, shall be
entitled to receive from the Corporation either cash in an
amount equal to the number of Performance Units in his
Account, multiplied by the Fair Market Value of one Common
Share on such date, the number of Common Shares equal to the
number of Performance Units, multiplied by the Fair Market
Value of one Common Share on such Date, or a combination of
such Common Shares and cash, the product of which is divided
by the Fair Market Value of one Common Share on such date.
In connection with a distribution pursuant to the preceding
sentence, a Participant shall also be entitled to a cash
payment equal to the dividends in his Account relating to
the distributed Performance Shares and the earnings in his
Account relating to the distributed Performance Units.
Payment to a Participant of the amount set forth above shall
be made or commence within 90 days after the earlier of (i)
such specified date, or (ii) the date of termination
described in paragraphs (c)(i) through (iv) above. Payments
in cash may be made either in a lump sum or in equal annual
installments over a period not to exceed ten years. The
Committee shall have the sole discretion to determine the
form and method of payment under the Plan and the period
over which such payment shall be made. Notwithstanding the
foregoing, in the event that a Participant's employment with
the Corporation and its subsidiaries terminates following a
Change of Control of the Corporation for any reason other
than attainment of Retirement Age, death, Disability or
termination by the Corporation for Cause, payments with
respect to all Performance Shares and Performance Units in
his Account, including credits with respect to dividends on
Performance Shares or earnings on Performance Units, shall
be made in cash within ten days after such termination takes
place. Except as provided in subsection (b), a Participant
shall not be entitled to receive any earnings on the value
of his Performance Shares or Performance Units with respect
to the period between his termination of employment and the
receipt of payments under the Plan.
28
10. ASSIGNMENT
Except as provided in subsection 8(e) and (f) or in connection
with unrestricted Common Shares issued pursuant to an Award, Awards
granted under the Plan and any rights and privileges pertaining
thereto, may not be transferred, assigned, pledged or hypothecated in
any manner, by operation of law or otherwise, other than by will or by
the laws of descent and distribution, and shall not be subject to
execution, attachment or similar process. In the event of the death of
a Participant or a Nonemployee Director, any distribution due under
the Plan shall be made to the duly appointed and qualified executor or
other personal representative of the Participant or the Nonemployee
Director to be distributed in accordance with the will or applicable
intestacy law of the Participant or Nonemployee Director; or in the
event that there shall be no representative duly appointed and
qualified within six months after the date of death of such deceased
Participant or Nonemployee Director, then to such persons as, at the
date of his death, would be entitled to share in the distribution of
such deceased person's personal estate under the provisions of the
applicable statute then in force governing the descent of intestate
property, in the proportions specified in such statute.
11. ADJUSTMENTS
The number of shares available for issuance under the Plan, the
number of shares subject to Awards granted under the Plan, the number
of Performance Shares credited to a Participant's Account or
applicable to performance periods in progress, and the exercise price
with respect to Options and base price with respect to SARs granted
under the Plan may be appropriately adjusted as the Committee may
determine for any increase or decrease in the number of issued Common
Shares resulting from a subdivision or consolidation of shares whether
through reorganization, recapitalization, share split, reverse share
split, share distribution or combination of shares, or the payment of
a share dividend or other increase or decrease in the number of such
shares outstanding, effected without receipt of consideration by the
Corporation. Adjustments under this Section 11 shall be made according
to the sole discretion of the Committee, and the decision of the
Committee as to the timing, nature and amount of such adjustments
shall be binding and conclusive. If any such adjustment results in
the computation of a number of Common Shares that is not a whole
number, such number shall be rounded down to the next whole number.
12. DISSOLUTION OR LIQUIDATION
Upon the dissolution or liquidation of the Corporation, each
Participant's and Nonemployee Director's rights with respect to
Options and SARs that have not been exercised, Restricted Shares that
are subject to forfeiture, and Performance Shares or Performance Units
that are either unearned or not yet distributable, as of the date of
the occurrence of such event, shall terminate and be forfeited and
neither the Participant, the Nonemployee Director, nor their heirs,
personal representatives, successors or assigns shall have any future
rights with respect to any such Options, SARs, Restricted Shares,
Performance Shares, or Performance Units. Notwithstanding the
foregoing, the Committee, in its discretion exercised in a
nondiscriminatory way, may (i) adjust the terms of any Award to give
the holder thereof the opportunity to participate in any distribution
on Common Shares related to the dissolution or liquidation, or (ii)
otherwise provide for a distribution to any holder of an Award
affected by the dissolution or liquidation; provided, however, that if
the dissolution or liquidation occurs after a Change of Control of the
Corporation, the Committee shall, (i) by such adjustment or
distribution, provide that the holder of each Award shall benefit in
29
the same manner as if such Award had been exercised or made
unrestricted prior to the distributions on Common Shares related to
the dissolution or liquidation, or (ii) make a cash distribution to
such holder in an amount equal to the value of the Award (including,
in the case of a Performance Share and Performance Unit, the Account
related thereto).
13. GOVERNMENT REGULATIONS
Notwithstanding any of the provisions hereof, or of any Option,
SAR, Restricted Share, Performance Share, or Performance Unit granted
hereunder, the obligation of the Corporation to issue and deliver
shares upon the exercise of such Option or SAR or upon a distribution
with respect to a Performance Share or Performance Unit, or the
obligation of the Corporation to issue and deliver certificates
evidencing Restricted Shares, shall be subject to all applicable laws,
rules and regulations and to such approvals by any governmental
agencies or national securities exchanges as may be required,
including, without limitation, the obligation of the Corporation to
have a registration statement or statement that complies with the
provisions of the Securities Act of 1933, as amended, in effect with
respect to such shares at the time of such issuance and delivery
unless the Corporation receives evidence satisfactory to it that such
issuance and delivery, in absence of such an effective registration
statement or statements, would not constitute a violation of the terms
and provisions of such act.
14. TERMINATION AND AMENDMENT OF PLAN
The Board (or the Committee) may amend, alter or terminate the
Plan, provided that, subject to Section 11, no amendment, alteration
or termination shall be made which would materially and adversely
affect the rights of any Participant or Nonemployee Director under any
Option, SAR, Performance Share, or Performance Unit theretofore
granted, or of any Participant who had theretofore acquired Restricted
Shares pursuant to the Plan, without such Participant's or Nonemployee
Director's consent, as the case may be.
15. WITHHOLDING TAXES
Whenever the Corporation proposes or is required to issue or
transfer Common Shares to a Participant under the Plan, the
Corporation shall have the right to require the Participant to remit
to the Corporation an amount sufficient to satisfy all federal, state
and local withholding tax requirements prior to the delivery of any
certificate or certificates for such shares. If such certificates have
been delivered prior to the time a withholding obligation arises, the
Corporation shall have the right to require the Participant to remit
to the Corporation an amount sufficient to satisfy all federal, state
or local withholding tax requirements at the time such obligation
arises and to withhold from other amounts payable to the Participant,
as compensation or otherwise, as necessary. Whenever payments under
the Plan are to be made to a Participant in cash, such payments shall
be net of any amounts sufficient to satisfy all federal, state and
local withholding tax requirements. The Corporation may, if approved
by the Committee in its discretion, in connection with an Award in the
form of Common Shares, allow a Participant to direct the Corporation
to withhold a portion of the Common Shares otherwise distributable or
to transfer to the Corporation a certain number of Common Shares
30
(either subject to a Restricted Share Award or previously owned) with
a Fair Market Value at the date of exercise equal to the amount
required to be withheld, and make necessary cash payments to
appropriate taxing authorities to satisfy its withholding obligation.
16. RIGHT TO TERMINATE EMPLOYMENT
Nothing in the Plan or any agreement entered into pursuant to the
Plan shall confer upon any Participant the right to continue in the
employment of the Corporation or its subsidiaries or affect any right
that the Corporation or its subsidiaries may have to terminate the
employment of such Participant.
17. RIGHTS AS SHAREHOLDER
The recipient of any Award under the Plan shall have no rights as
a shareholder with respect thereto unless and until certificates for
Common Shares are issued to him.
18. LEAVES OF ABSENCE
The Committee shall be entitled to make such rules, regulations
and determinations as it deems appropriate under the Plan in respect
of any leave of absence taken by the recipient of any Award. Without
limiting the generality of the foregoing, the Committee shall be
entitled to determine (i) whether or not any such leaves of absence
shall constitute a termination of employment within the meaning of the
Plan, and (ii) the impact, if any, of any such leave of absence on
awards under the Plan theretofore made to any recipient who takes such
leave of absence.
19. EFFECTIVE DATE
The Plan shall become effective as of the date it is approved by
the holders of a majority of the Common Shares of the Corporation
(voting as a single class) present, or represented, and entitled to
vote at the 1998 Annual Meeting of Shareholders of the Corporation.
There shall be no Options, SARs, Restricted Shares, Performance
Shares, or Performance Units granted or awarded under the Plan after
2008; provided, however, that all Options, SARs, Restricted Shares,
Performance Shares, and Performance Units granted or sold under the
Plan prior to such date shall remain in effect and subject to
adjustment and amendment as herein provided until they have been
satisfied or terminated in accordance with the Plan and the terms of
their related agreements.
20. GOVERNING LAW
The Plan, and all agreements hereunder, shall be construed in
accordance with and governed by the laws of the State of Indiana and,
in the case of ISOs, Section 422A of the Code.
31
21. INDEMNIFICATION
Each person who is or shall have been a member of the Committee
or of the Board shall be indemnified and held harmless by the
Corporation against and from any loss, cost, liability, or expense
that may be imposed upon or reasonably incurred by him in connection
with or resulting from any claim, action, suit, or proceeding to which
he may be a party or in which he may be involved by reason of any
action taken or failure to act under the Plan and against and from any
and all amounts paid by him in settlement thereof with the
Corporation's approval, or paid by him in satisfaction of any judgment
in any such action, suit or proceeding against him; provided, however,
that he shall give the Corporation an opportunity at its own expense,
to handle and defend the same before he undertakes to handle and
defend it on his own behalf. The foregoing right of indemnification
shall not be exclusive of any other rights of indemnification to which
such persons may be entitled under the Corporation's Articles of
Incorporation or By-laws, as a matter of law, or otherwise, or any
power that the Corporation may have to indemnify them or to hold them
harmless.
22. SUCCESSORS
In the event of a sale of substantially all of the assets of the
Corporation, or a merger, consolidation or share exchange involving
the Corporation, all obligations of the Corporation under the Plan
with respect to awards granted hereunder shall be binding on the
successor to the Corporation in the transaction. Employment with such
a successor shall be considered employment with the Corporation for
purposes of the Plan.
23. NOTICES
Notices given pursuant to this Agreement shall be in writing and
shall be deemed received when personally delivered or five days after
mailed by United States registered or certified mail, return receipt
requested, addressee only, postage prepaid. Notice to the Corporation
shall be directed to:
Secretary
Arvin Industries, Inc.
One Noblitt Plaza, Box 3000
Columbus, Indiana 47202-3000
Notices to Participants and Nonemployee Directors shall be directed to
such person at the home address of such person on the records of the
Corporation. Notwithstanding the foregoing, if either party shall have
previously designated address by notice to the other party given in
the foregoing manner, then notices to such party shall be directed as
designated.
32
LIMITATION OF LIABILITY
Neither the Company, Arvin, Meritor, nor any of their agents
(including Arvin or Meritor if it is acting as such) in administering
the Plan shall be liable for any act done in good faith or for the
good faith omission to act in connection with the Plan. However,
nothing contained herein shall affect a Participant's right to bring a
cause of action based on alleged violations of federal securities
laws.
USE OF PROCEEDS
Any net proceeds that the Company realizes from the issuance of its
common stock under the Plan will be used for general corporate
purposes.
PLAN OF DISTRIBUTION
The common stock being offered hereby is offered pursuant to the Plan,
the terms of which provide for the issuance of common stock following
satisfaction of the applicable vesting, exercise and/or lapse of
restrictions schedules applicable to stock options, stock appreciation
rights, restricted shares, performance shares and performance units
granted under the Plan.
DESCRIPTION OF COMMON STOCK
The Company's certificate of incorporation authorizes the issuance of
500,000,000 shares of Common Stock. The description of the Common
Stock is incorporated by reference into this Prospectus. See "Where
You Can Find More Information" for information on how to obtain a copy
of this description.
EXPERTS
The consolidated financial statements of Arvin Industries, Inc. as of
January 2, 2000 and January 3, 1999 and for each of the three years in
the period ended January 2, 2000 set forth in the Company's Current
Report on Form 8-K dated July 10, 2000 have been incorporated by
reference in this document in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm, as experts in auditing and accounting. The
consolidated financial statements of Meritor as of September 30, 1999
and 1998 and for each of the three years in the period ended September
30, 1999 and the related financial statement schedule incorporated by
reference in this registration statement from Meritor's Annual Report
on Form 10-K for the fiscal year ended September 30, 1999 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in
their reports, which are incorporated by reference, and have been so
incorporated in reliance upon the reports of such firm given upon
their authority as experts in accounting and auditing.
33
LEGAL MATTERS
Certain legal matters in connection with the Company's Common Stock
offered hereby have been passed upon for the Company by Schiff Hardin
& Waite, Chicago, Illinois.
34
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses in connection with the offering are as
follows:
<TABLE>
<CAPTION>
<S> <C>
Registration fee under the Securities Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $796
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $15,000
Accounting fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $15,000
------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $35,796
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Indiana Business Corporation Law permits indemnification of
officers, directors, employees and agents against liabilities and
expenses incurred in proceedings if the person acted in good faith and
reasonably believed that (1) in the case of conduct in the person's
official capacity with the corporation, that the person's conduct was
in the corporation's best interests, and (2) in all other cases, that
the person's conduct was at least not opposed to the corporation's
best interests. In criminal proceedings, the person must either have
reasonable cause to believe the conduct was lawful or must have had no
reasonable cause to believe the conduct was unlawful. Unless the
articles of incorporation provide otherwise, indemnification is
mandatory in two instances: (1) a director successfully defends
himself in a proceeding to which the director was a party because the
director is or was a director of the corporation, or (2) it is court
ordered.
Section 8.06 of the Company's Restated Articles of Incorporation
contain provisions authorizing, to the extent permitted under the
Indiana Business Corporation Law and the Company's By-Laws,
indemnification of directors and officers, including payment in
advance of expenses in defending an action and maintaining liability
insurance on such directors and officers. Specifically, the Company's
By-Laws provide that the Company shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil or
criminal, administrative or investigative, formal or informal (an
"Action"), by reason of the fact that such person is or was a
director, officer, employee or agent of the Company, or is or was
serving at the request of the Company as a director, officer,
employee, agent, partner, trustee or member or in another authorized
capacity of or for another corporation, unincorporated association,
business trust, estate, partnership, trust, joint venture, individual
or other legal entity, whether or not organized or formed for profit,
35
against expenses (including attorneys' fees) and judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such Action. The Company also shall
pay, in advance of the final disposition of an Action, the expenses
reasonably incurred in defending such action by a person who may be
entitled to indemnification. Article 8 of the Company's By-Laws and
the appendix thereto entitled "Procedures for Submission and
Determination of Claims for Indemnification Pursuant to Article 8 of
the By-Laws" set forth particular procedures for submission and
determination of claims for indemnification.
The Company's directors and officers are insured against certain
liabilities for actions taken in such capacities, including
liabilities under the Securities Act.
ITEM 16. EXHIBITS.
The Exhibits filed herewith are set forth on the Exhibit Index
filed as part of this Registration Statement.
ITEM 17. UNDERTAKINGS.
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement;
36
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the Company pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
The Company hereby undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the
Company's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the
Company in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final
adjudication of such issue.
37
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Company certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly
caused this Amendment No. 1 to Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City
of Troy, State of Michigan, on the 24th day of August, 2000.
ARVINMERITOR, INC.
By: /s/ Vernon G. Baker, II
-------------------------------
Vernon G. Baker, II
Senior Vice President, General
Counsel and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to Registration Statement has been signed by the
following persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Larry D. Yost* Chairman of the Board and August 24, 2000
--------------------- Chief Executive Officer (principal
Larry D. Yost executive officer)
/s/ V. William Hunt* Vice Chairman and President August 24, 2000
---------------------- and Director
V. William Hunt
/s/ Thomas A. Madden* Senior Vice President and August 24, 2000
----------------------- Chief Financial Officer (principal
Thomas A. Madden financial officer)
/s/ William M. Lowe* Vice President and Controller August 24, 2000
------------------------ (principal accounting officer)
William M. Lowe
------------------------- Director
Joseph B. Anderson, Jr.
38
------------------------- Director
Donald R. Beall
/s/ Steven C. Beering* Director August 24, 2000
-------------------------
Steven C. Beering
/s/ Rhonda L. Brooks* Director August 24, 2000
-------------------------
Rhonda L. Brooks
/s/ John J. Creedon* Director August 24, 2000
-------------------------
John J. Creedon
/s/ Joseph P. Flannery* Director August 24, 2000
--------------------------
Joseph P. Flannery
/s/ Robert E. Fowler, Jr.* Director August 24, 2000
-----------------------------
Robert E. Fowler, Jr.
/s/ William D. George, Jr.* Director August 24, 2000
-----------------------------
William D. George, Jr.
------------------------------ Director
Ivan W. Gorr
/s/ Richard W. Hanselman* Director August 24, 2000
------------------------------
Richard W. Hanselman
39
/s/ Charles H. Harff* Director August 24, 2000
------------------------------
Charles H. Harff
/s/ Don J. Kacek* Director August 24, 2000
-------------------------------
Don J. Kacek
/s/ Victoria B. Jackson* Director August 24, 2000
-------------------------------
Victoria B. Jackson
/s/ James E. Marley* Director August 24, 2000
-------------------------------
James E. Marley
/s/ James E. Perella* Director August 24, 2000
--------------------------------
James E. Perella
/s/ Harold A. Poling* Director August 24, 2000
--------------------------------
Harold A. Poling
/s/ Martin D. Walker* Director August 24, 2000
---------------------------------
Martin D. Walker
*By /s/Vernon G. Baker, II
-----------------------------
Vernon G. Baker, II
Attorney-in-Fact
</TABLE>
40
INDEX TO EXHIBITS
Exhibit Number Description
-------------- -----------
2* Agreement and Plan of Reorganization dated as of
April 6, 2000, By and Among Meritor Automotive,
Inc., Mu Sub, Inc. and Arvin Industries, Inc.
(incorporated by reference to Appendix A of the
Joint Proxy Statement - Prospectus contained in
the Company's Registration Statement on Form S-4/A
(File No. 333-365448), filed with the Commission
on June 2, 2000).
4.1** Form of ArvinMeritor, Inc. 1998 Stock Benefit Plan
(as Successor to the Arvin Industries, Inc. 1998
Stock Benefit Plan)(included as part of the Form
S-3 prospectus).
4.2* Rights Agreement, dated as of July 3, 2000,
between the Company and EquiServe Trust Company,
N.A. (incorporated by reference to Exhibit 1 of
the Company's Registration Statement on Form 8-
A12B (Reg. No. 001-15983), filed with the
Commission on July 10, 2000).
5** Opinion of Schiff Hardin & Waite.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Deloitte & Touche LLP.
23.3** Consent of Schiff Hardin & Waite (included in its
opinion filed as Exhibit 5).
24** Power of Attorney.
--------------
* Incorporated by reference.
** Previously filed.
41
