SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 26, 1996
------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-1373
------
MODINE MANUFACTURING COMPANY
(Exact name of registrant as specified in its charter)
WISCONSIN 39-0482000
--------------------------------------------- -------------------
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
1500 DeKoven Avenue, Racine, Wisconsin 53403-2552
--------------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (414) 636-1200
--------------
NOT APPLICABLE
---------------------------------------------------------------------
(Former name or former address, if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
----- ------
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at November 1, 1996
------------------------------ -------------------------------
Common Stock, $0.625 Par Value 29,854,095
<PAGE>
MODINE MANUFACTURING COMPANY
INDEX
Page No.
--------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets -
September 26 and March 31, 1996 3
Consolidated Statements of Earnings -
For the Three Months Ended
September 26, 1996 and 1995
and the Six Months Ended
September 26, 1996 and 1995 4
Consolidated Statements of Cash Flows -
For the Six Months Ended September 26,
1996 and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis
of Results of Operations and Financial
Condition 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15
Signatures 17
<PAGE>
<TABLE>
MODINE MANUFACTURING COMPANY
CONSOLIDATED BALANCE SHEETS
September 26, 1996 and March 31, 1996
(In thousands, except per-share amounts)
(Unaudited)
<CAPTION>
September 26, 1996 March 31, 1996
------------------ --------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 24,581 $ 17,958
Trade receivables, less allowance for
doubtful accounts of $4,742 and $5,052 156,395 147,963
Inventories 142,516 150,000
Deferred income taxes and other
current assets 29,362 35,414
--------- ---------
Total current assets 352,854 351,335
--------- ---------
Other assets:
Property, plant, and equipment - net 210,495 201,341
Investment in affiliates 6,038 6,567
Intangible assets, less accumulated
amortization of $11,108 and $8,689 67,470 70,456
Deferred charges and other noncurrent
assets 44,412 42,137
--------- ---------
Total other assets 328,415 320,501
--------- ---------
Total assets $ 681,269 $ 671,836
========= =========
<CAPTION>
LIABILITIES AND SHAREHOLDERS' INVESTMENT
- ----------------------------------------
<S> <C> <C>
Current liabilities:
Short-term debt $ 5,745 $ 12,500
Long-term debt - current portion 29,916 12,552
Accounts payable 63,648 77,277
Accrued compensation and employee
benefits 45,016 42,941
Income taxes 6,778 7,598
Accrued expenses and other current
liabilities 28,380 28,163
--------- ---------
Total current liabilities 179,483 181,031
--------- ---------
Other liabilities:
Long-term debt 74,259 87,809
Deferred income taxes 12,345 12,220
Other noncurrent liabilities 42,579 41,356
--------- ---------
Total other liabilities 129,183 141,385
--------- ---------
Total liabilities 308,666 322,416
--------- ---------
<PAGE>
Shareholders' investment:
Preferred stock, $0.025 par value,
authorized 16,000 shares,
issued - none - -
Common stock, $0.625 par value,
authorized 80,000 shares, issued
30,342 shares 18,964 18,964
Additional paid-in capital 9,608 9,143
Retained earnings 359,179 339,193
Foreign currency translation adjustment 2,601 3,435
Treasury stock at cost: 485 and 583
shares, respectively (14,679) (17,607)
Restricted stock - unamortized value (3,070) (3,708)
--------- ---------
Total shareholders' investment $ 372,603 $ 349,420
--------- ---------
Total liabilities and shareholders'
investment $ 681,269 $ 671,836
========= =========
<FN>
(See accompanying notes to consolidated financial statements.)
</TABLE>
<PAGE>
<TABLE>
MODINE MANUFACTURING COMPANY
CONSOLIDATED STATEMENTS OF EARNINGS
For the three months ended September 26, 1996 and 1995
For the six months ended September 26, 1996 and 1995
(In thousands, except per-share amounts)
(Unaudited)
<CAPTION>
Three months ended Six months ended
---------------------- ----------------------
September 26 September 26
---------------------- ----------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net Sales $254,224 $254,292 $502,738 $493,508
Cost of sales 184,884 186,355 365,821 364,689
-------- -------- -------- --------
Gross profit 69,340 67,937 136,917 128,819
Selling, general, and administrative expenses 44,593 41,182 86,918 76,649
-------- -------- -------- --------
Income from operations 24,747 26,755 49,999 52,170
Non-operating income 1,889 2,153 4,516 4,711
Interest expense (1,562) (1,879) (2,864) (3,506)
Non-operating expense (1,445) (888) (2,832) (2,196)
-------- -------- -------- --------
Earnings before income taxes 23,629 26,141 48,819 51,179
Provision for income taxes 7,975 9,405 16,775 18,460
-------- -------- -------- --------
Net earnings $ 15,654 $ 16,736 $ 32,044 $ 32,719
======== ======== ======== ========
Net earnings per share of common stock* $0.51 $0.55 $1.05 $1.07
======== ======== ======== ========
Dividends per share $0.17 $0.15 $0.34 $0.30
======== ======== ======== ========
Average common shares and common share
equivalents outstanding 30,459 30,453 30,430 30,510
======== ======== ======== ========
<FN>
(See accompanying notes to consolidated financial statements.)
*See EXHIBIT 11 for computation of earnings per share.
</TABLE>
<PAGE>
<TABLE>
MODINE MANUFACTURING COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
For the Six Months Ended September 26, 1996 and 1995
(Unaudited)
Six months ended September 26
-----------------------------
1996 1995
-------- --------
<S> <C> <C>
Net cash provided by operating activities $48,674 $46,027
Cash flows from investing activities:
Expenditures for property, plant, and
equipment (28,748) (20,914)
Acquisitions, net of cash acquired (1,829) (55,460)
Proceeds from dispositions of property,
plant, and equipment 107 1,556
Other - net (133) 235
------- -------
Net cash (used for) investing activities (30,603) (74,583)
Cash flows from financing activities:
(Decrease)/increase in short-term debt - net (6,789) 12,405
Additions to long-term debt 13,205 24,736
Reductions of long-term debt (8,733) (10,218)
Issuance of common stock, including treasury
stock 3,489 1,076
Purchase of treasury stock (2,479) (5,408)
Cash dividends paid (10,141) (8,899)
------- -------
Net cash(used for)/provided by financing
activities (11,448) 13,692
------- -------
Net increase/(decrease) in cash and cash
equivalents 6,623 (14,864)
Cash and cash equivalents at beginning of
period 17,958 32,691
------- -------
Cash and cash equivalents at end of period $24,581 $17,827
======= =======
<FN>
(See accompanying notes to consolidated financial statements.)
</TABLE>
<PAGE>
MODINE MANUFACTURING COMPANY
----------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
------------------------------------------------------
1. The amounts of raw material, work in process and finished
goods cannot be determined exactly except by physical
inventories. Based on partial interim physical inventories
and percentage relationships at the time of complete
physical inventories, Management believes the amounts shown
below are reasonable estimates of raw material, work in
process and finished goods.
(In Thousands)
----------------------------------------------------------------
September 26, 1996 March 31, 1996
----------------------------------------------------------------
Raw materials $ 34,874 $ 38,307
Work in process 42,939 47,794
Finished goods 64,703 63,899
-------- --------
Total inventories $142,516 $150,000
======== ========
2. Property, plant, and equipment is composed of:
(In Thousands)
----------------------------------------------------------------
September 26, 1996 March 31, 1996
----------------------------------------------------------------
Gross, property,
plant & equipment $456,473 $433,881
Less accumulated
depreciation (245,978) (232,540)
-------- --------
Net property,
plant & equipment $210,495 $201,341
======== ========
3. Recent developments concerning legal proceedings reported in
the Company's Form 10-K Report for the year ended March 31,
1996, are updated in Part II, Other Information, Item 1,
Legal Proceedings. While the outcome of these proceedings
is uncertain, in the opinion of the Company's Management,
any liabilities that may result from such proceedings are
not reasonably likely to have a material effect on the
Company's liquidity, financial condition, or results of
operations.
4. On October 3, 1996, the company announced that the majority
owners of Constructions Mecaniques Mota (CMM), a heat -
exchanger manufacturer based near Marseilles, a Province in
France, and Modine GmbH, a German subsidiary of Modine
Manufacturing Company, have agreed to the cash purchase by
Modine of approximately 45 percent of CMM. CMM employs
<PAGE>
about 150 employees and has annual sales of approximately
$22 million. CMM manufactures tube-bundle coolers for use
in truck and marine engines, and industrial motors. CMM
serves primarily European customers, including major
European vehicle manufacturers. On October 31, 1996, the
company announced the completion of the acquisition.
5. The accompanying consolidated financial statements, which
have not been audited by independent certified public
accountants, were prepared in conformity with generally
accepted accounting principles and such principles were
applied on a basis consistent with the preparation of the
consolidated financial statements in the Company's March 31,
1996 Annual Report filed with the Securities and Exchange
Commission. The financial information furnished includes
all normal recurring accrual adjustments which are, in the
opinion of Management, necessary for a fair statement of
results for the interim period. Results for the first six
months of fiscal 1997 are not necessarily indicative of the
results to be expected for the full year.
6. Certain notes and other information have been condensed or
omitted from these interim financial statements which
consolidate both domestic and foreign wholly-owned
subsidiaries. Therefore, such statements should be read in
conjunction with the consolidated financial statements and
related notes contained in the Company's 1996 Annual Report
to stockholders which statements and notes were incorporated
by reference in the Company's Form 10-K Report for the year
ended March 31, 1996.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
---------------------------------------------
The following discussion and analysis provides information which
Management believes is relevant to an assessment and understanding
of the Company's consolidated results of operations and financial
condition. This discussion should be read in conjunction with the
consolidated financial statements and notes thereto.
RESULTS OF OPERATIONS
- ---------------------
Comparison of the Second Quarter of 1996-97 with the Second Quarter
- -------------------------------------------------------------------
of 1995-96
- ----------
Net sales for the second quarter of fiscal 1996-97 were $254.2
million, essentially unchanged from the $254.3 million reported
in the second quarter of last year. The soft second quarter sales
reflect: a greater proportion of the business coming from Europe,
where many customers' production lines are closed in late summer;
the currency impact of a stronger dollar than last year; lower
shipments to some highway-vehicle manufacturers, particularly in
the medium- and heavy-truck market; continuing heavy competition
from off-shore sources in the North American aftermarket; and the
sale of the company's copper tubing business at the end of last
year's second quarter.
Gross margin increased 0.6%, as a percentage of sales, over the
second quarter of the previous year to 27.3% from 26.7%.
Improvement in gross margin earned by the company's European
operations and its Signet Systems subsidiary, acquired last year,
were among the improved contributors.
Selling, general and administrative expenses increased 8.3% over
last year's second quarter while increasing 1.3% as a percentage
of sales. Over 35% of the increase can be attributed to
including an additional month of operating activity in the
current year by Signet Systems, which was acquired at the end of
July 1995. Other items contributing to the overall dollar
increase were higher personnel costs associated with normal
inflation and additional goodwill amortization resulting from
acquisitions made in the prior year.
Average outstanding debt levels during the quarter declined by
approximately $3.7 million, or 3.2%, over the same period a year ago.
Correspondingly, interest expense decreased 16.9%, or $0.3 million
from a year ago. The lower interest expense can be attributed to a
continuing reduction in higher rate domestic debt through normally
scheduled repayments, lower interest rates on certain non-domestic
debt, and higher capitalized interest expense associated with the
Company's larger capital expenditure program. Net non-operating
income declined $0.8 million due primarily to lower joint venture
earnings and lower foreign currency transaction gains.
<PAGE>
The effective tax rate decreased by 2.2% when compared to the
same period last year. The reduction is the result of recently
completed IRS reviews, a reduction in state taxes, net of federal
benefit and other smaller changes.
Net earnings for the second quarter were $15.7 million or $.51
per share, reflecting a decrease of 6.5% from last year's $16.7
million, or $.55 per share. Earnings continued to be negatively
affected by plant start-up expenses in South Carolina and
Holland.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
------------------------------------
RESULTS OF OPERATIONS
---------------------
Comparison of the First Six Months of 1996-97 with the First Six
- ----------------------------------------------------------------
Months of 1995-96
- -----------------
Net sales for the first six months of fiscal 1996-97 reached a
record $502.7 million, up 1.9% from the $493.5 million reported
in the first six months of last year. Sales by Signet Systems,
acquired in July, 1995, and improved sales by the Company's
European operations, despite the impact of the stronger dollar,
were the major factors leading to the overall sales improvement
from a year ago. Offsetting these gains were the loss of sales
from the copper tubing business, sold in October, 1995, and lower
sales in the Company's domestic automotive, truck, and building-
HVAC businesses.
Modine's worldwide shipments during the first six months had the
largest gains in the passenger-car and light-truck market with
the largest sales growth to European customers. The second
largest gain was recorded in agricultural- and construction
segments of the off-highway market. The remaining markets
demonstrated modest growth except for the medium- heavy-truck
market and the building-HVAC market, which registered small
declines.
Gross margin increased 1.1%, as a percent of sales, over the
first six months of the previous year to 27.2% from 26.1%.
Contributing to the overall improvement were improved gross
margins earned by the Company's European operations, Signet
Systems, and the North American aftermarket.
Selling, general and administrative expenses increased 13.4% over
the first six months last year while increasing 1.8% as a
percentage of sales. Approximately 45% of the increase can be
attributed to including an additional four months of operating
activity in the current year by Signet Systems, which was
acquired at the end of July 1995. The remaining dollar increase
is primarily due to higher personnel costs and additional
goodwill amortization resulting from acquisitions made in the
prior year.
Average outstanding debt levels during the first six months rose
by approximately $7.3 million, or 7.0%, over the same period a
year ago. Corresponding interest expense declined by 18.3%, or
$0.6 million, over the same six month period, a year ago.
Interest expense grew at a slower rate in part due to a
continuing reduction in higher rate domestic debt through
normally scheduled repayments. A reduction in interest rates on
certain non-domestic debt and higher capitalized interest expense
also contributed to the decrease in interest expense.
The effective tax rate decreased by 1.7% when compared to the
same period last year. The main factor responsible for the
<PAGE>
decrease was the net utilization of certain foreign operating
loss carryforwards.
Net earnings for the six months were $32.0 million, or $1.05 per
share, down 2.1% from last year's $32.7 million, or $1.07 per
share.
Outlook for the Remainder of the Year
- -------------------------------------
The results for the first six months of the fiscal 1996-97 are
consistent with Company expectations; therefore, the Company is
reaffirming its earlier forecast of sales growth in the 4% range
with earnings growing at a similar to slightly higher rate than
sales. These forward-looking statements regarding sales and
earnings are subject to certain risks and uncertainties which
could cause actual results to differ materially from those
projected. See "Important Factors and Assumptions Regarding
Forward-Looking Statements" attached hereto as Exhibit 99 and
incorporated herein by reference.
<PAGE>
FINANCIAL CONDITION
-------------------
Comparison between September 26, 1996 and March 31, 1996
- --------------------------------------------------------
Current Assets
- --------------
Cash and cash equivalents increased by $6.6 million to a total of
$24.6 million. The Company's primary sources of liquidity and
capital resources were cash provided by operations and the use of
available borrowing facilities.
Net trade receivables increased $8.4 million, or 5.7%. An
approximate $10.1 million increase in sales volume in the second
quarter of fiscal 96-97, compared to the fourth quarter of fiscal
95-96 was the major factor responsible for the increase. Normal
seasonal marketing programs were also a factor contributing to
the increase shown.
Overall inventory levels decreased by $7.5 million. Among the
items affecting inventory were ongoing management efforts to
control inventory levels, changes in sales volumes, exchange rate
fluctuations in Europe, and process and product line changes at
certain manufacturing facilities.
Deferred income taxes and other current assets decreased $6.1
million. The decrease occurred primarily from reductions
recorded in unbilled customer tooling and non-trade receivables.
Working capital increased approximately 2% to $173.4 million from
$170.3 million and the current ratio increased to 2.0 to 1 from
1.9 to 1. A number of categories experienced changes, with the
largest items influencing the change being an increase in long-
term debt due within one year, a decrease in accounts payable,
and an increase in trade receivables.
Property, Plant and Equipment
- -----------------------------
Net property, plant and equipment increased $9.2 million to
$210.5 million as capital expenditures exceeded depreciation,
retirements and foreign currency translations. Outstanding
material commitments for capital expenditures were $11.7 million
at September 26, 1996, compared to $17.1 million at March 31,
1996. Most of the commitments relate to plant expansions,
tooling for new products, and various new equipment. The
outstanding commitments will be financed through internally
generated cash.
Intangible Assets
- -----------------
Intangible assets, net of accumulated amortization declined $3.0
million. Amortization and foreign currency translations were the
main items contributing to the change.
<PAGE>
Deferred Charges and Other Assets
- ---------------------------------
Deferred charges and other assets increased $2.3 million. The
net increase is primarily the result of continuing recognition of
the surplus in the Company's overfunded pension plans.
Current Liabilities
- -------------------
Accounts payable and various accrued expenses decreased $11.3
million. Normal timing differences in the level of operating
activity were responsible for the decline. Accrued income taxes
decreased $0.8 million from normal timing differences in making
estimated tax payments and federal tax benefits resulting from
the exercise of stock options.
Debt
- ----
Outstanding debt decreased by $2.9 million from March 31, 1996.
Long-term debt increased by $3.8 million while short-term debt
decreased by $6.7 million. The Company's European subsidiaries
accounted for all of the change in short-term debt. The current
portion of long-term debt increased temporarily by $17.4 million
due primarily to the timing and duration of a foreign subsidiary
lender's extension of a revolving credit agreement. The
agreement was extended to June 30, 2000 after the end of the
quarter.
Consolidated available lines of credit decreased by $7.4 million,
including a discontinuance of $10.0 million U.S. capacity. The
European subsidiaries net lines of credit increased by $2.6
million. The foreign unused lines of credit at September 26,
1996 were $10.3 million, while the Company had $13.5 million
available under domestic revolvers. Total debt as a percentage
of shareholders' equity decreased from 32.3% to 29.5%.
Shareholders' Investment
- ------------------------
Total shareholders' investment increased by $23.2 million to a
total of $372.6 million. The net increase came primarily from
net earnings of $32.0 million for the first six months. Dividends
paid to shareholders of $10.1 million, net treasury stock sales
of $2.9 million, and other minor changes to the capital accounts
also contributed to the change.
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
In the normal course of business, the Company and its
subsidiaries are named as defendants in various lawsuits and
enforcement proceedings by private parties, the Occupational
Safety and Health Administration, the Environmental Protection
Agency, other governmental agencies, and others in which claims,
such as personal injury, property damage, or antitrust and trade
regulation issues, are asserted against the Company. While the
outcome of these proceedings is uncertain, in the opinion of the
Company's Management and counsel, any liabilities that may result
from such proceedings are not reasonably likely to have a
material effect on the Company's liquidity, financial condition
or results of operations. Many of the pending damage claims are
covered by insurance and, in addition, the Company from time to
time establishes reserves for uninsured liabilities.
The Mitsubishi and Showa Litigation
-----------------------------------
In November 1991, the Company filed a lawsuit in the Federal
District Court in Milwaukee, Wisconsin against Mitsubishi Motor
Sales of America, Inc. and Showa Aluminum Corporation, alleging
infringement of the Company's Patent No. 4,998,580 on parallel-
flow air-conditioning condensers. The suit seeks an injunction
to prohibit continued infringement and accounting for damages, a
trebling of such damages for willful infringement, and
reimbursement of attorneys' fees. In December of 1991, the
Company submitted a complaint to the U. S. International Trade
Commission (ITC) requesting that the ITC ban the import and sale
of parallel-flow air-conditioning condensers and systems or
vehicles that contain them, which are the subject of the
aforementioned lawsuit. In July 1993, the ITC reversed an
earlier ruling by a hearing officer and upheld, as valid and
enforceable, the Company's 4,998,580 patent on parallel-flow air-
conditioning condensers. The ITC also ruled that specific
condensers from the two Japanese companies did not infringe the
Company's patent. Each of the parties appealed to the U.S. Court
of Appeals for the Federal Circuit the portion of the ITC opinion
adverse to them. In February 1996, the U.S. Court of Appeals for
the Federal Circuit, upheld the patent as valid and enforceable
and remanded the case back to the ITC for a determination with
respect to Showa infringement. In July of 1994, Showa filed a
lawsuit against the Company in the Federal District Court in
Columbus, Ohio alleging infringement by the Company of Showa's
patents pertaining to double circuit condensers and baffles
therefor (In June, 1995, the Company filed a motion for partial
summary judgment against such lawsuit). In December of 1994, the
Company filed another lawsuit against Mitsubishi Motor Sales of
America, Inc. and Showa Aluminum Corporation in the Federal
District Court in Milwaukee, Wisconsin pertaining to the
Company's newly-issued Patent No. 5,372,188 also pertaining to
parallel-flow air-conditioning condensers. Both 1994 suits have
been stayed pending the outcome of re-examination in the U. S.
Patent Office of the patents involved. All legal and court costs
associated with these cases have been expensed as they were
incurred.
<PAGE>
Other previously reported legal proceedings have been settled or
the issues resolved so as to not merit further reporting.
Item 5. Other Information.
Modine Holding GmbH, a German subsidiary of Modine
Manufacturing Company, has agreed to the cash purchase of
approximately 45 percent of Constructions Mecaniques Mota (CMM),
a heat-exchanger manufacturer based near Marseilles in Province,
France. On October 31, 1996, the company announced the
completion of the acquisition.
CMM is a profitable company whose annual sales are
approximately $22 million. About 150 employees make tube-bundle
oil coolers for truck and marine engines, and industrial motors.
CMM has a large number of European customers, including major
European vehicle manufacturers.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
--------
The following exhibits are included for information only unless
specifically incorporated by reference in this report:
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ------
3* Restated By-Laws (as amended October 16, 1996). 20
4(a) Rights Agreement dated as of October 16, 1986
between the Registrant and First Chicago Trust
Company of New York (Rights Agent)
(filed by reference to the Registrant's Annual
Report on Form 10-K for the fiscal year
ended March 31, 1992).
4(b)(i) Rights Agreement Amendment No. 1 dated as of
January 18, 1995 between the Registrant and
First Chicago Trust Company of New York
(Rights Agent) (filed by reference to the
exhibit contained within the Registrant's
Current Report on Form 8-K dated January 13,
1995.)
4(b)(ii) Rights Agreement Amendment No. 2 dated as of
January 18, 1995 between the Registrant and
First Chicago Trust Company of New York
(Rights Agent) (filed by reference to the
exhibit contained within the Registrant's
Current Report on Form 8-K dated January 13,
1995.)
<PAGE>
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ------
Note: The amount of long-term debt
authorized under any instrument
defining the rights of holders of long-
term debt of the Registrant, other
than as noted above, does not exceed
ten percent of the total assets of the
Registrant and its subsidiaries on a
consolidated basis. Therefore, no
such instruments are required to be
filed as exhibits to this Form 10-K.
The Registrant agrees to furnish
copies of such instruments to the
Commission upon request.
10* Employment Agreement between the Registrant
and Donald R. Johnson, President and Chief
Operating Officer, dated 10/16/96. 32
11* Computation of per share earnings 18
27* Financial Data Schedule (electronic
transmission only).
99* Important Factors and Assumptions Regarding
Forwarding-Looking Statements. 19
*Filed herewith.
(b) Reports on Form 8-K:
-------------------
Subsequent to the end of the quarter, the Company filed one
Report on Form 8-K to report that the Company announced the
promotion of Richard T. Savage to chairman and chief executive
officer, Donald J. Johnson to president and chief operating
officer, and Anthony C. DeVuono to vice president, technical
services. This Report is dated October 16, 1996.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
MODINE MANUFACTURING COMPANY
(Registrant)
By: A. D. REID
----------------------------------------
A. D. Reid, Vice President,
Finance and Chief Financial Officer
(Principal Financial Officer)
Date: November 1, 1996 By: W. E. PAVLICK
----------------------------------------
W. E. Pavlick, Senior Vice President,
General Counsel and Secretary
<PAGE>
<TABLE>
EXHIBIT 11
MODINE MANUFACTURING COMPANY
COMPUTATION OF PER SHARE EARNINGS
(In thousands, except per share amounts)
<CAPTION>
Three months ended Six months ended
------------------------ ------------------------
September 26 September 26
------------------------ ------------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Primary
- -------
Weighted average shares outstanding 29,855 29,647 29,819 29,663
Share equivalents for period prior to
exercise (options exercised) 14 1 29 15
Net shares issuable, assuming exercise
of options using average market price
and employing the treasury stock method. 590 805 582 832
------- ------- ------- -------
Average common share and common
share equivalents 30,459 30,453 30,430 30,510
======= ======= ======= =======
Net earnings for the period $15,654 $16,736 $32,044 $32,719
======= ======= ======= =======
Net earnings per share of common stock $0.51 $0.55 $1.05 $1.07
======= ======= ======= =======
Fully Diluted
- -------------
Weighted average shares outstanding 29,855 29,647 29,819 29,663
Share equivalents for period prior to
exercise (options exercised) 14 1 29 15
Net shares issuable, assuming exercise
of options using ending market price
(unless antidilutive) and employing
the treasury stock method 604 805 604 832
------- ------- ------- -------
Average common share and common
share equivalents 30,473 30,453 30,452 30,510
======= ======= ======= =======
Net earnings for the period $15,654 $16,736 $32,044 $32,719
======= ======= ======= =======
Net earnings per share of common stock $0.51 $0.55 $1.05 $1.07
======= ======= ======= =======
</TABLE>
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONSOLIDATED BALANCE SHEET AND CONSOLIDATED STATEMENT
OF EARNINGS FOR THE PERIOD ENDING 9/26/96 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-1-1996
<PERIOD-END> SEP-26-1996
<CASH> 24,581
<SECURITIES> 0
<RECEIVABLES> 161,137
<ALLOWANCES> 4,742
<INVENTORY> 142,516
<CURRENT-ASSETS> 352,854
<PP&E> 456,473
<DEPRECIATION> 245,978
<TOTAL-ASSETS> 681,269
<CURRENT-LIABILITIES> 179,483
<BONDS> 74,259
0
0
<COMMON> 18,964
<OTHER-SE> 353,639
<TOTAL-LIABILITY-AND-EQUITY> 681,269
<SALES> 502,738
<TOTAL-REVENUES> 502,738
<CGS> 365,821
<TOTAL-COSTS> 365,821
<OTHER-EXPENSES> 0
<LOSS-PROVISION> (204)
<INTEREST-EXPENSE> 2,864
<INCOME-PRETAX> 48,819
<INCOME-TAX> 16,775
<INCOME-CONTINUING> 32,044
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 32,044
<EPS-PRIMARY> 1.05
<EPS-DILUTED> 1.05
</TABLE>
EXHIBIT 99
IMPORTANT FACTORS AND ASSUMPTIONS
REGARDING FORWARD-LOOKING STATEMENTS
These cautionary statements are being made pursuant to the provisions of the
Private Securities Litigation Reform Act of 1995 and with the intention of
obtaining the benefits of the "safe harbor" provisions of the Act. Investors
are cautioned that any forward-looking statements made by Modine are not
guarantees of future performance and that actual results may differ materially
from those in the forward-looking statements as a result of various factors,
including: customers' integration of products currently being supplied by the
Company; the success of Modine or its competitors in obtaining the business of
the customer base; the ability to pass on increased costs to customers;
variations in currency-exchange rates in view of a large portion of the
Company's business being non-domestic; labor relations at Modine, its
customers, and its suppliers, which may affect the continuous supply of
product; and the ability to improve acquisitions' operations.
In making statements about Modine's fiscal-1997 operating results, management
has assumed relatively stable economic conditions in the United States and
worldwide, no unanticipated swings in the business cycles affecting customer
industries, and a reasonable legislative and regulatory climate in those
countries where Modine does business.
Readers are cautioned not to place undue reliance on Modine's forward-looking
statements, which speak only as of the date such statements are made.
<PAGE>
EXHIBIT 3
RESTATED
BY-LAWS
OF
MODINE MANUFACTURING COMPANY
(as adopted July 17, 1969)
(as amended September 17, 1970)
(as amended September 16, 1971)
(as amended May 4, 1972)
(as amended March 20, 1974)
(as amended September 18, 1974)
(as amended May 19, 1976)
(as amended July 21, 1976)
(as amended May 18, 1977)
(as amended July 20, 1977)
(as amended October 18, 1978)
(as amended May 16, 1979)
(as amended July 18, 1979)
(as amended October 17, 1979)
(as amended October 15, 1980)
(as amended May 1, 1981)
(as amended May 5, 1982 to be effective
July 21, 1982)
(as amended August 17, 1982)
(as amended February 18, 1987)
(as amended March 18, 1987)
(as amended July 15, 1987)
(as amended February 15, 1989)
(as amended May 19, 1993)
(as amended October 20, 1993)
(as amended November 17, 1993)
(as amended March 16, 1994 to be effective
July 20, 1994)
(as amended May 17, 1995 to be effective
July 19, 1995)
(as amended October 16, 1996 to be effective
October 16, 1996)
ARTICLE I. STOCKHOLDERS
------------------------
1.01. Annual Meeting. The annual meeting of stockholders
--------------
of the Company shall be held each year at such time and place, either
within or without the State of Wisconsin, as shall be determined by
the Board of Directors at a meeting prior to the date otherwise
provided herein for such stockholders' meeting; in the absence or
failure of the Board to designate a time and place, then at the
principal office of the Company in Racine, Wisconsin, on the third
Wednesday in July, at 9:30 o'clock A.M., for the purpose of election
of directors and for the transaction of such other business as may
properly come before the meeting.
<PAGE>
1.02. Special Meetings. Special meetings of the stockholders
----------------
may be called by the Chairman of the Board or the President and shall be
called by the President, or Secretary at the request in writing of a
majority of the Board of Directors, or at the request of stockholders
owning Ten Percent (10%) or more in amount of the entire capital stock
of the Company issued and outstanding and entitled to vote. Such
request shall state the purpose or purposes of the proposed meeting.
Business transacted at all special meetings shall be confined to the
purposes stated in the notice of meeting.
1.03. Notice of Meetings. The Company shall notify each
------------------
shareholder who is entitled to vote at the meeting, and any other
shareholder entitled to notice under ch. 180, of the date, time, and
place of each annual or special shareholders' meeting. In the case of
special meetings, the notice shall also state the meeting's purpose.
Unless otherwise required by ch. 180, the meeting notice shall be given
at least five (5) days before the meeting date. Notice may be given
orally or communicated in person, by telephone, telegraph, teletype,
facsimile, other form of wire or wireless communication, private
carrier, or in any other manner provided by ch. 180. Written notice,
if mailed, is effective when mailed; and such notice may be addressed
to the shareholder's address shown in the Company's current record of
shareholders. Written notice provided in any other manner is effective
when received. Oral notice is effective when communicated.
1.04. Quorum. A quorum at any meeting of the stockholders
------
shall consist of a majority of the voting stock of the Company
represented in person or by proxy. Unless otherwise provided in the
Articles of Incorporation, by these by-laws, or by the Wisconsin
Business Corporation Law, a majority of such quorum shall decide any
questions that may come before the meeting. Though less than a quorum
of the outstanding shares are represented at a meeting, a majority of
the shares so represented may adjourn the meeting from time to time
without further notice. At such adjourned meeting at which a quorum
shall be present or represented, any business may be transacted which
might have been transacted at the meeting as originally notified.
1.05. Order of Business. The order and conduct of
-----------------
business and matters of procedure at any meeting of stockholders
shall be determined by the Chairman.
1.06. List of Stockholders. The officer or agent
--------------------
having charge of the stock transfer books for shares of the
Company shall, before each meeting of stockholders, make a
complete list of the stockholders entitled to vote at such
meeting or any adjournment thereof, with the address of and the
number of shares held by each, which list shall be produced and
kept open at the time and place of the meeting and shall be
subject to the inspection of any stockholder during the whole
time of the meeting for the purposes of the meeting. The
original stock transfer books shall be prima facie evidence as to
the stockholders entitled to examine such list or transfer books
or to vote at any meeting of stockholders.
<PAGE>
1.07. Inspectors of Election. Two inspectors of
----------------------
election shall be appointed by the Board of Directors at or
before each stockholders' meeting at which an election of
directors shall take place; if no such appointment shall have
been made, or if the inspectors appointed by the Board shall
refuse to act, or fail to attend, then the appointment shall
be made by the Chairman at the meeting. The inspectors shall
receive and take in charge all proxies and ballots, and shall
decide all questions touching upon the qualification of voters,
and validity of proxies and the acceptance and rejection of
votes. In case of a tie vote by the inspectors on any questions,
the Chairman shall decide.
1.08. Voting of Shares. Each outstanding share shall
----------------
be entitled to one vote upon each matter submitted to a vote at
a meeting of stockholders, except to the extent that the voting
rights of the shares of any class or classes are enlarged, limited
or denied by the Wisconsin Business Corporation Law, the Articles
of Incorporation, or the resolution of the Board of Directors
creating such series of any class.
1.09. Proxies. At all meetings of stockholders, a
-------
stockholder entitled to vote may vote in person or by proxy
appointed in writing by the stockholder or by his duly authorized
attorney-in-fact. Such proxy shall be filed with the Secretary
of the Company before or at the time of meeting. Unless otherwise
provided in the proxy, a proxy may be revoked at any time before it
is voted either by written notice filed with the Secretary or the
acting secretary of the meeting or by oral notice given by the
stockholder to the presiding officer during the meeting. The
presence of a stockholder who has filed his proxy shall not of
itself constitute a revocation. No proxy shall be valid after
eleven (11) months from the date of its execution, unless otherwise
provided in the proxy. The Board of Directors shall have the power
and authority to make rules establishing presumptions as to the
validity and sufficiency of proxies.
ARTICLE II. DIRECTORS
----------------------
2.01. Number, Classification and Terms of Directors.
---------------------------------------------
The number of directors shall be nine. Directors need not be
stockholders.
The Board of Directors shall be divided into three
classes: each class consisting of three directors. The term of
office of a director shall be three years. The classes of
directors shall be staggered so that each expires in succeeding
years. At each annual meeting of stockholders, the number of
directors equal to the number of the class whose terms expire
at the time of such meeting shall be elected to hold office until
the third succeeding annual meeting and until their successors
shall have been elected.
<PAGE>
2.02. Annual Directors' Meetings. Annual meeting of
--------------------------
the Board of Directors shall be held immediately following the
annual meeting of stockholders. No notice of the annual meeting
of the Board of Directors shall be required.
2.03. Special Directors' Meetings. Special meetings
---------------------------
of the Board of Directors may be called by the Chairman of the
Board, the President, or Secretary on twenty-four (24) hours'
notice to each director.
2.04. Notice of Meetings; Waiver of Notice. Notice of
------------------------------------
each board of directors' meeting, except meetings pursuant to
Section 2.02 of these by-laws, shall be delivered to each
director at his or her business address or at such other address
as the director shall have designated in writing and filed with
the Secretary. Notice may be given orally or communicated in
person, by telephone, telegraph, teletype, facsimile, other form
of wire or wireless communication, private carrier, or in any
other manner provided by ch. 180. Written notice shall be deemed
given at the earlier of the time it is received or at the time it
is deposited with postage prepaid in the United States mail or
delivered to the private carrier. Oral notice is effective when
communicated. A director may waive notice required under this
section or by-law at any time, whether before or after the time
of the meeting. The waiver must be in writing, signed by the
director, and retained in the corporate record book. The
director's attendance at or participation in a meeting shall
constitute a waiver of notice of the meeting, unless the director
at the beginning of the meeting or promptly upon his or her
arrival objects to holding the meeting or transacting business at
the meeting and does not thereafter vote for or assent to action
taken at the meeting. Neither the business to be transacted at
nor the purpose of any regular or special board of directors
meeting need be specified in the notice or waiver of notice of
the meeting.
2.05. Regular Meetings. Regular meetings of the
----------------
directors may be held without notice at such place and times as
shall be determined from time to time by resolution of the Board
of Directors.
2.06. Quorum. A quorum at any meeting of the Board of
------
Directors shall consist of a majority of the entire membership of
the Board. Unless otherwise provided in the Articles of
Incorporation, these by-laws, or by law, a majority of such
quorum shall decide all questions that may come before the meeting.
2.07. General Powers of Directors. The Board of
---------------------------
Directors shall manage the business and affairs of the Company
and subject to the restrictions imposed by law, by the Articles
of Incorporation, or by these by-laws, may exercise all the
powers, including specific powers, of the Company.
<PAGE>
2.08. Compensation of Directors. The Board of
-------------------------
Directors, by the affirmative vote of a majority of the directors
then in office, and irrespective of any personal interest of any
of its members, shall have authority to establish reasonable
compensation of all directors for services to the Company as
directors, officers or otherwise, or to delegate such authority
to an appropriate committee. The Board of Directors also shall
have authority to provide for or to delegate authority to an
appropriate committee to provide for reasonable pensions,
disability or death benefits, employee stock options, and other
benefits or payments, to directors, officers and employees and to
their estates, families, dependents or beneficiaries on account
of prior services rendered by such directors, officers and
employees to the Company.
2.09. Resignation and Removal for Cause. Any
---------------------------------
director, member of a committee or other officer may resign at
any time. Such resignation shall be made in writing, and shall
take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the Chairman or
Secretary. The acceptance of a resignation shall not be
necessary to make it effective.
A director may be removed from office during the term
of such office but only upon a showing of good cause, such
removal to be by affirmative vote of a majority of the
outstanding shares entitled to vote for the election of such
director and which removal may only be taken at a special meeting
of stockholders called for that purpose.
A special meeting of the stockholders as herein
referred to may only be held after a hearing on the matter of
cause claimed to exist has been held by the full Board of
Directors of the Company at which hearing the director or
directors proposed for removal shall be given an adequate
opportunity for preparation and attendance in person (together
with representation by counsel); provided, however, that such
hearing shall be held only after written notice has been given to
said director or directors proposed for removal specifying the
matters of cause claimed to exist. The conclusions of said
hearing shall be reported by the Board of Directors in writing
accompanying the notice of the special stockholders' meeting sent
to each stockholder eligible to vote at said special meeting.
2.10. Increase or Decrease of Number of Directors.
-------------------------------------------
Increase or decrease of the number of directors and
classification of such directors, may only be made by amendment
of these by-laws at a regular or special meeting called for that
purpose, and a vacancy created by an increase in the number of
directors may be filled at such meeting.
2.11. Filling of Vacancies. If the office of any
--------------------
director, member of a committee or other officer becomes vacant
for any reason, including vacancies on the Board of Directors due
<PAGE>
to removal for cause, the remaining directors in office, by a
majority vote, may appoint any qualified person to fill such
vacancy, who shall hold office for the unexpired term and until
his successor shall be duly chosen.
2.12. Informal Action by Directors. Any action
----------------------------
required or permitted by the Articles of Incorporation, these by-
laws or other provision of law, which might be taken at a
meeting of the Board of Directors or of a lawfully constituted
committee thereof, may be taken without a meeting if a consent in
writing, setting forth the action so taken, shall be signed by
all the directors, or by all of the members of such committee, as
the case may be.
2.13. Retirement. Each Director shall be retired at
----------
the close of the term in which he attains the age of seventy (70)
years except that this provision shall not apply to any Director
who has been exempted from this provision by a resolution passed
by a two-thirds vote of the Board of Directors. Upon such
retirement a Director may take the status of a Director Emeritus.
A Director Emeritus shall receive the notice of meetings of
Directors, shall be invited to and welcome at all meetings of the
Board and of the stockholders, and shall receive such compensation
and such reimbursement for reasonable expenses, if any, for attendance
at meetings as the Board of Directors shall determine, provided,
however, that such compensation shall not exceed that received by
a Director. A Director Emeritus shall attend the meetings of the
Board in a consultive capacity but shall not be entitled to vote or
have any duties or powers of a Director of the Company.
2.14. Committees. The Board of Directors may by
----------
resolution or resolutions, adopted by a majority of the total
number of directors, designate one or more committees, each such
committee to consist of three or more directors elected by the
Board of Directors which, to the extent provided in said
resolution or resolutions, shall have and may exercise the powers
of the Board of Directors in the management of the business and
affairs of the corporation. Such committees shall have such
names as may be determined from time to time by resolution
adopted by the Board of Directors. A majority of the members of
any such committee may determine its action unless the Board of
Directors shall otherwise provide. The Board of Directors shall
have power at any time to fill vacancies in, to change the
membership of, or to dissolve any such committee. The Board of
Directors may elect one or more of its members as alternate
members of any committee who may take the place of any absent
member or members at any meeting of such committee.
ARTICLE III. OFFICERS
----------------------
3.01. Number. The principal officers of the Company
------
shall be a Chairman of the Board of Directors, a President, such
number of Vice Presidents as the Board of Directors shall elect,
a Secretary, and a Treasurer, each of whom shall be elected by
<PAGE>
the Board of Directors. Such other officers and assistant
officers as may be deemed necessary may be elected or appointed
by the Board of Directors. Any two or more offices may be held
by the same person, except the offices of President and Secretary
and the offices of President and Vice President.
3.02. Election and Term of Office. The officers of
---------------------------
the Company to be elected by the Board of Directors shall be
elected annually by the Board of Directors at the first meeting
of the Board of Directors held after each annual meeting of the
stockholders. If the election of officers shall not be held at
such meeting, such election shall be held as soon thereafter as
conveniently may be. Each officer shall hold office at the
pleasure of the Board of Directors or until his successor shall
have been duly elected or until his prior death, resignation or
removal.
3.03. Removal. Any officer or agent may be removed by
-------
the Board of Directors whenever in its judgment the best
interests of the Company will be served thereby, but such removal
shall be without prejudice to the rights provided by written
contract, if any, of the person so removed. Election or
appointment shall not of itself create contract rights.
3.04. Vacancies. A vacancy in any principal office
---------
because of death, resignation, removal, disqualification or
otherwise, shall be filled by the Board of Directors for the
unexpired portion of the term.
3.05. Chairman of the Board. The Chairman of the
---------------------
Board of Directors shall preside at all meetings of stockholders
and directors. In his absence, a director elected by the Board
shall preside.
The Chairman shall be the Chief Executive
Officer of the Company, and subject to the control of the Board
of Directors, shall in general supervise and control all of the
business and affairs of the Company. He shall have authority,
subject to such rules as may be prescribed by the Board of
Directors, to appoint such agents and employees of the Company as
he shall deem necessary, to prescribe their powers, duties and
compensation, and to delegate authority to them. Such agents and
employees shall hold office at the discretion of the Chairman.
He shall have authority to sign, execute and acknowledge, on behalf
of the Company, all deeds, mortgages, bonds, stock certificates,
contracts, leases, reports and all other documents or instruments
necessary or proper to be executed in the course of the Company's
regular business, or which shall be authorized by resolution of
the Board of Directors; and, except as otherwise provided by law
or the Board of Directors, he may authorize the President or any
Vice President or other officer or agent of the Company to sign,
execute and acknowledge such documents or instruments in his place
and stead. In general he shall perform all duties incident to the
office of Chairman and Chief Executive and such other duties as may
be prescribed by the Board of Directors from time to time.
<PAGE>
3.06. President. The President shall be the Chief
---------
Operating Officer of the Company and, subject to the control of
the Board of Directors and the Chairman of the Board and Chief
Executive Officer, shall supervise and control the operations of
the Company. In the absence of the Chief Executive Officer or in
the event of his death, inability or refusal to act, or in the
event for any reason it shall be impracticable for the Chief
Executive Officer to act personally, the President shall perform
the duties of the Chief Executive Officer, and when so acting,
shall have all the powers of and be subject to all the
restrictions upon the Chief Executive Officer.
3.07. The Vice President. In the absence of the
------------------
President or in the event of his death, inability or refusal to
act, or in the event for any reason it shall be impracticable for
the President to act personally, the Vice President (or in the
event there be more than one Vice President, the Vice Presidents
in the order designated by the Board of Directors, or in the
absence of any designation, then in the order of their election)
shall perform the duties of the President, and when so acting,
shall have all the powers of and be subject to all the
restrictions upon the President. Any Vice President may sign,
with the Secretary or Assistant Secretary, certificates for
shares of the Company; and shall perform such other duties and
have such authority as from time to time may be delegated or
assigned to him by the Chairman, President or by the Board of
Directors. The execution of any instrument of the Company by any
Vice President shall be conclusive evidence, as to third parties,
of his authority to act in the stead of the President.
3.08. The Secretary. The Secretary shall: (a) keep
-------------
the minutes of the meetings of the stockholders and of the Board
of Directors in one or more books provided for that purpose; (b)
see that all notices are duly given in accordance with the
provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the Company
and see that the seal of the Company is affixed to all documents
the execution of which on behalf of the Company under its seal is
duly authorized; (d) sign with the Chairman, President or a Vice
President, certificates for shares of the Company, the issuance
of which shall have been authorized by resolution of the Board of
Directors; and (e) in general perform all duties incident to the
office of Secretary as provided by the Wisconsin Business
Corporation Law and have such other duties and exercise such
authority as from time to time may be delegated or assigned to
him by the Chairman, President or by the Board of Directors.
3.09. The Treasurer. The Treasurer shall: (a) have
-------------
charge and custody of and be responsible for all funds and
securities of the Company; (b) receive and give receipts for
moneys due and payable to the Company from any source whatsoever,
and deposit all such moneys in the name of the Company in such
banks, trust companies or other depositaries as shall be selected
in accordance with the provisions of Section 6.07; and (c) in
general perform all of the duties incident to the office of
<PAGE>
Treasurer and have such other duties and exercise such other
authority as from time to time may be delegated or assigned to
him by the Chairman, President or by the Board of Directors.
3.10. Assistant Secretaries and Assistant Treasurers.
----------------------------------------------
There shall be such number of Assistant Secretaries and Assistant
Treasurers as the Board of Directors may from time to time
authorize and designate. The Assistant Secretaries and Assistant
Treasurers, in general, shall perform such duties and have such
authority as shall from time to time be delegated or assigned to
them by the Secretary or the Treasurer, respectively, or by the
Chairman, President or the Board of Directors.
3.11. Other Assistants and Acting Officers. The Board
------------------------------------
of Directors shall have the power to appoint any person to act as
assistant to any officer, or as agent for the Company in his stead,
or to perform the duties of such officer whenever for any reason it
is impracticable for such officer to act personally, and such
assistant or acting officer or other agent so appointed by the Board
of Directors shall have the power to perform all the duties of the
office to which he is so appointed to be assistant, or as to which
he is so appointed to act, except as such power may be otherwise
defined or restricted by the Board of Directors.
3.12. Salaries. The salaries of the principal officers
--------
shall be fixed from time to time by the Board of Directors or by a
duly authorized committee thereof, and no officer shall be prevented
from receiving such salary by reason of the fact that he is also a
director of the Company.
ARTICLE IV. INDEMNIFICATION BY THE COMPANY
-------------------------------------------
Any person made a party to or threatened with any civil,
criminal, administrative or investigative action, suit or proceeding
(other than an action by or in the right of the Company) by reason of
the fact that he, his testator or intestate, is or was a Director,
officer or employee of the Company or is or was serving at the request
of the Company as a Director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise,
shall be indemnified by the Company against the reasonable expenses,
including attorneys' fees, judgments, fines, and amounts paid in
settlement, actually and necessarily incurred by him in connection
with such action, suit or proceeding, or in connection with any appeal
therein, if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Company,
and with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful. Such right of indemnification
shall not be deemed exclusive of any other right to which such Director,
officer, employee or agent may otherwise be entitled.
ARTICLE V. CAPITAL STOCK
-------------------------
5.01 Certificates of Stock. Certificates of stock,
---------------------
<PAGE>
numbered and with the seal of the Company affixed, signed by the
President, or a Vice President, and the Secretary or an Assistant
Secretary, shall be issued to each stockholder certifying the
number of shares owned by him in the Company. When such
certificates are countersigned by a transfer agent, or registered
by a registrar, the signatures of such officers may be
facsimiles. A facsimile or printed seal of the Company may be
affixed upon certificates of stock of the Company.
In case any officer who has signed, or whose facsimile
signature has been placed upon a certificate has ceased to be an
officer of the Company before such certificate has been issued,
such certificate may, nevertheless, be adopted and issued and
delivered by the Company as though the officer who signed such
certificate or whose facsimile signature shall have been used
thereon, had not ceased to be such officer with the same effect
as if he were such office at the date of its issue.
5.02. Lost Certificates. A new certificate of stock
-----------------
may be issued in the place of any certificate theretofore issued
by the Company, alleged to have been lost or destroyed, and the
directors may, in their discretion, require the owner of the lost
or destroyed certificate, or his legal representative, to give
the Company a bond, in such sum as they may direct, not exceeding
double the value of the stock, to indemnify the Company against
any claim that may be made against it on account of the alleged
loss of any such certificate or the issuance of any such new
certificate.
5.03. Transfer of Shares. Transfer of stock shall be
------------------
made only on the transfer books of the Company, kept at the
office of the Company or respective transfer agents designated to
transfer the stock, and before a new certificate is issued, the
old certificate shall be surrendered and cancelled.
5.04. Closing of Transfer Books. The Board of
-------------------------
Directors of the Company may provide that the stock transfer books
be closed for a period not to exceed, in any case, fifty (50) days
for the purpose of determining stockholders entitled to notice of or
to vote at any meeting of stockholders, or any adjournment thereof,
or entitled to receive payment of any dividend, or in order to make
a determination of stockholders for any other proper purposes. If
the stock transfer books shall be closed for the purpose of
determining stockholders entitled to notice of or to vote at a
meeting of stockholders, such books shall be closed for at least ten
(10) days immediately preceding such meeting. In lieu of closing the
stock transfer books, the Board of Directors may fix in advance a date
as the record date for any such determination of stockholders, such
date in any case to be not more than seventy (70) days and, in case of
a meeting of stockholders not less than ten (10) days prior to the date
on which the particular action, requiring such determination of
stockholders is to be taken. When a determination of stockholder,
entitled to vote at any meeting of stockholders has been made as provided
herein, such determination shall be applied to any adjournment thereof
except when the determination has been made through the closing of the
stock transfer books and the stated period of closing has expired.
<PAGE>
5.05. Dividends. The Board of Directors of the
---------
Company may, from time to time, declare and the Company may pay
dividends on its outstanding shares in cash, property, or its own
shares, as provided by law.
ARTICLE VI. MISCELLANEOUS
--------------------------
6.01. Corporate Seal. The corporate seal shall be a
--------------
round metallic disc, with the words "MODINE MANUFACTURING
COMPANY, Wisconsin" around the circumference, and the words
"CORPORATE SEAL" in the center. If a facsimile or printed seal
is used on stock certificates, it shall be similar in content and
design to the above.
6.02. Fiscal Year. The fiscal year of the Company
-----------
shall begin on the first day of April in each year, and end on
the thirty-first day of March in the following year.
6.03. Contracts. The Board of Directors may authorize
---------
any officer or officers, agent or agents, to enter into any
contract or exercise or deliver any instrument in the name of and
on behalf of the Company, and such authorization may be general
or confined to specific instances. In the absence of other
designation, all deeds, mortgages, contracts, promissory notes,
and instruments of assignment or pledge made by the Company shall
be executed in the name of the Company by the Chairman, President
or one of the Vice Presidents and by the Secretary, an Assistant
Secretary, the Treasurer or an Assistant Treasurer; the Secretary
or an Assistant Secretary, when necessary or required, shall
affix the corporate seal thereto; and when so executed no other
party to such instrument or any third party shall be required to
make any inquiry into the authority of the signing officer or
officers.
6.04. Loans. No indebtedness for borrowed money shall
-----
be contracted on behalf of the Company and no evidence of such
indebtedness shall be issued in its name unless authorized by or
under the authority of a resolution of the Board of Directors.
Such authorization may be general or confined to specific
instances.
6.05. Drafts, Checks, etc. All checks, drafts or
-------------------
other orders for the payment of money issued in the name of the
Company shall be signed by such employee or employees, agent or
agents, of the Company as are appointed by the Chairman or
President, and in such manner, including facsimile and printed
signatures, as may be designated by the Chairman or President.
In connection with the furnishing of authorizing resolution and
signature card forms needed by commercial banks, the corporate
Secretary, or any Assistant Secretary, is authorized to execute
and certify to such forms as he may deem appropriate as adopted
under the authority of this by-law and as binding upon the
<PAGE>
Company in accordance therewith, thereby empowering employees or
agents appointed by the President to sign checks, drafts, or
other orders for the payment of money in the name of the Company.
6.06. Deposits. All funds of the Company not
--------
otherwise employed shall be deposited from time to time to the
credit of the Company in such banks, trust companies or other
depositaries as may be selected by or under the authority of the
Chairman or President. In connection with the furnishing of
authorizing resolution and signature card forms, needed by such
banks, trust companies or other depositaries, the corporate
Secretary, or any Assistant Secretary, is authorized to execute
and certify to such forms as he may deem appropriate as adopted
under the authority of his by-law and as binding upon the Company
in accordance therewith, thereby designating such banks, trust
companies or other depositaries as may be selected by the
Chairman or President, for the deposit of Company funds.
6.07. Voting of Securities Owned by this Company.
------------------------------------------
Subject always to the specific directions of the Board of
Directors, (a) any shares or other securities issued by any other
corporation and owned or controlled by this Company may be voted
at any meeting of security holders of such other corporation by
the Chairman of this Company if he be present, or in his absence
by the President or any Vice President of this Company who may be
present, and (b) whenever, in the judgment of the Chairman, or in
his absence, of the President or any Vice President, it is
desirable for this Company to execute a proxy or written consent
in respect to any shares for other securities issued by any other
corporation and owned by this Company, such proxy or consent
shall be executed in the name of this Company by the Chairman,
President or one of the Vice Presidents of this Company, without
necessity of any authorization by the Board of Directors,
affixation of corporate seal or countersignature or attestation
by another officer. Any person or persons designated in the
manner above stated as the proxy or proxies of this Company shall
have full right, power and authority to vote the shares or other
securities issued by such other corporation and owned by this
Company the same as such shares or other securities might be
voted by this Company.
ARTICLE VII. AMENDMENTS
------------------------
These by-laws may be amended, repealed or altered in
whole or in part by the affirmative vote of not less than two-
third (2/3) of the shares of the Company entitled to vote
thereon, or by the affirmative vote of not less than two-thirds
(2/3) of the full Board of Directors of the Company, at any
regular meeting of the stockholders or of the Board of Directors,
or any special meeting of the stockholders or Bard of Directors,
provided that such action has been specified in the notice of any
such meeting.
<PAGE>
EXHIBIT 10
AGREEMENT
THIS AGREEMENT made and entered into as of the 16th day
of October, 1996, by and between Modine Manufacturing Company,
a Wisconsin corporation, having its principal place of business
in Racine, Wisconsin (the "Company"), and Donald R. Johnson, of
Racine, Wisconsin (the "Executive").
WHEREAS, the Company desires to engage the Executive
and Executive is desirous of committing himself to serve the
Company for the period and on the terms herein provided.
NOW THEREFORE, In consideration of the foregoing and
the respective covenants and agreements of the parties
herein contained, the parties hereto agree as follows:
I. Employment; Period of Employment.
--------------------------------
1.01 The Company hereby agrees to continue Executive
in its employ, and Executive hereby agrees to remain in the employ
of the Company for a period of two (2) years, commencing on
October 16, 1996 and ending on October 16, 1998, (the "Period of
Employment"); provided, however, that on each anniversary of the
date of this Agreement the Period of Employment shall be
automatically extended for an additional year unless prior thereto
either party hereto has given written notice to the other that each
party does not wish to extend the Period of Employment.
II. Position; Duties; Responsibilities.
----------------------------------
2.01 It is contemplated that during the Period of
Employment the Executive shall continue to serve as a
principal officer of the Company with the offices, titles,
reporting responsibilities, duties and responsibilities
including those specifically set forth in Exhibit A attached
to and made a part of this Agreement. At all times during
the Period of Employment Executive shall hold a position of
responsibility and importance with duties and
responsibilities attached thereto, at least equal in scope,
responsibility and importance to and commensurate with the
position described in general terms herein in Exhibit A.
2.02 Throughout the Period of Employment the
Executive shall devote his full time and undivided attention
during normal business hours to the business and affairs of
the Company except for reasonable vacations. The office of
the Executive shall be located at the principal offices of
the Company within the Racine, Wisconsin area and the
Executive shall not be required to locate his office
elsewhere without his prior written consent nor shall he be
required to be absent therefrom on travel status or
otherwise more than ninety (90) working days in any year nor
more than twenty (20) consecutive days at any one time.
<PAGE>
III. Compensation; Compensation Plans; Perquisites.
---------------------------------------------
3.01 (a) For all services rendered by the
Executive during the Period of Employment, Executive shall
be paid as compensation:
(i) A base salary (the Minimum Base
Salary), payable not less often than monthly, of no less
than $300,000 per year, with such increases in such rate as
shall be awarded from time to time in accordance with the
Company's regular administrative practices of other salary
increases applicable to Executives of the Company in effect
on the date of this Agreement and
(ii) An annual incentive award or bonus
under the Company's Management Incentive Plan, or such
equivalent successor plan as may be adopted by the Company,
that is 80% of the Chairman's incentive payment rate times
the Executive's base salary.
3.02 During the Period of Employment the
Executive shall be and continue to be a full participant in
the Incentive Stock Option Plan of the Company, the
Restricted Stock Plan and in any and all other executive
incentive plans in which executives of the Company
participate that are in effect on the date hereof and that
may hereafter be adopted, including, without limitation, any
stock option, stock purchase, stock appreciation right
plans, restricted stock plans, or equivalent successor plans
that may be adopted by the Company, with at least the same
reward opportunities that have heretofore been provided.
Nothing in this Agreement shall preclude improvement of
reward opportunities in such plans or other plans in
accordance with the present practice of the Company.
3.03 During the Period of Employment the
Executive shall be entitled to participate in the executive
perquisites of the Company as determined by the Board of
Directors for key employees, including without limitation,
an office, secretarial and clerical services, paid annual
Mayo Clinic Visits and income tax and estate planning
services.
IV. Employee Benefit Plans.
----------------------
4.01 The Executive, his dependents and
beneficiaries, including, without limitation, any
beneficiary of a joint and survivor or other optional method
of payment applicable to the payment of benefits under the
Pension and Disability Plan of the Company, shall be
entitled to all payments and benefits and service credit for
benefits during the Period of Employment to which officers
of the Company, their dependents and beneficiaries, are
entitled as the result of the employment of such officers
under the terms of employee plans and practices of the
Company, including, without limitation, the Pension and
<PAGE>
Disability Plan of the Company, the Modine Contributory
Employee Stock Ownership and Investment Plan, the 401(k)
plan, its death benefit plans (consisting of its Group
Insurance Plan for Management Employees providing term life
insurance, accidental death and dismemberment insurance, and
travel accident insurance), its disability benefit plans
(consisting of its Income Protection Plan providing salary
continuation, sickness and accident and long-term disability
benefits), its medical, dental and health and welfare plans
and other present or equivalent successor plans and practices
of the Company, for which officers, their dependents and
beneficiaries, are eligible, and to all payments or other
benefits under any such plan or practice subsequent to the
Period of Employment as a result of participation in such
plan or practice during the Period of Employment.
4.02 Nothing in this Agreement shall preclude the
Company from amending or terminating any employee benefit plan
or practice, but, it being the intent of the parties that the
Executive shall continue to be entitled during the Period of
Employment to perquisites as set forth in paragraph 3.03 above
and to benefits and service credit for benefits under paragraph
4.01 above through the Period of Employment hereunder.
V. Supplemental Retirement Benefit.
-------------------------------
5.01 Since certain limitations are placed on the
amount of benefits receivable by participants under the
Company's Pension and Disability Plan by the Internal Revenue
Code, and on the amounts contributable to the Company's Salary
Reduction Plan (401(k) Plan) under Article 5 of such plan, the
Company shall provide the Executive and his beneficiaries with
benefits equal to the benefits lost under those Plans as a
result of these limitations. Payments of such Supplemental
Retirement Benefits shall be made to the Executive or his
beneficiaries in a manner consistent with the elections available
under the Pension and Disability Plan and the 401(k) Plan.
VI. Effect of Death or Disability.
-----------------------------
6.01 In the event of the death of the Executive
during the Period of Employment, the legal representative of
the Executive shall be entitled to the compensation provided
for in paragraph 3.01 above for the month in which death occurred.
6.02 (a) The term "Disability," as used in this
Agreement, shall mean an illness or accident occurring
during the Period of Employment which prevents the Executive
from performing his duties under this Agreement.
(b) In the event of the Disability of the
Executive during the Period of Employment, the Executive
shall be entitled for a period of twelve (12) months to the
benefits provided for in paragraph 3.01(a)(i) and
3.01(a)(ii) above, at the rate being paid at the time of the
<PAGE>
commencement of Disability. After a disability period of
twelve (12) months, the Executive shall receive disability
payments of 60% of the monthly compensation set forth in
paragraphs 3.01(a)(i) and 3.01(a)(ii) less the amount of any
Company group insured long-term disability benefits he
receives. These disability payments are to continue to be
paid to the Executive until the end of the Period of
Employment. This shall not preclude the Executive from
receiving disability benefits after the Period of Employment
under the Company's group long-term disability plan.
VII. Termination.
-----------
7.01 The Company may at its option terminate this
Agreement at any time during the term hereof, with or
without cause. In the event of a termination, as defined in
paragraph 7.03 below, during the Period of Employment, the
provisions of this Section VII shall apply. Any provision
of this Agreement to the contrary notwithstanding, the
payments, benefits, service credit for benefits and other
matters provided in this Section VII in the event of such a
Termination are in addition to any such items provided by
Section V.
7.02 In the event of a Termination, the Company
shall, as liquidated damages, severance pay, and payment for
services rendered in the past, pay to the Executive an
amount equal to the Average Annual Earnings of the Executive
during the remainder of the Period of Employment. During
the period that payments provided in this paragraph 7.02 are
required, the Executive, his dependents and beneficiaries,
shall continue to be entitled to all benefits under employee
benefit plans of the Company as if Executive was still
employed and the period in which such payments are provided
shall be continued service with the Company for the purpose
of continued credits under the employee benefits plans and
for purposes of determining payments and other rights in
respect of awards made or accrued prior to termination under
the executive incentive plans referred to in paragraph 3.02.
(a) The term "Average Annual Earnings"
shall mean the arithmetic average of the Executive's annual
compensation includable in the Executive's gross income in
the five taxable year period preceding the taxable year of
termination.
7.03 The word " Termination," shall mean:
(a) Termination by the Company of the
employment of the Executive for any reason other than for
Cause as defined in paragraph 7.04 below or for disability
or death.
(b) Termination by the Executive of his
employment with the Company upon the occurrence of any of
the following events:
<PAGE>
(i) Failure to elect or reelect the
Executive to, or removal of the Executive from, the offices
described in paragraph 2.01 above and Exhibit A to this
Agreement.
(ii) A significant change in the nature
or scope of the authorities, powers, functions or duties
attached to the position described in paragraph 2.01 above
and Exhibit A to this Agreement, or a reduction in
compensation, which is not remedied within thirty (30) days
after receipt by the Company of written notice from the
Executive.
(iii) A determination by the
Executive made in good faith that as a result of a Change of
Control of the Company, as defined in Section XIV below, and
a change in circumstances thereafter and since the date of
this Agreement significantly affecting his position, he is
unable to carry out the authorities, powers, functions, or
duties attached to his position and contemplated by Section
II of this Agreement and the situation is not remedied
within thirty (30) days after receipt by the Company of
written notice from the Executive of such determination.
(iv) A breach by the Company of any
provision of this Agreement not embraced within the
foregoing clause (i), (ii), and (iii) of this subparagraph
7.03(b) which is not remedied within thirty (30) days after
receipt by the Company of written notice from the Executive.
(v) The liquidation, dissolution,
consolidation or merger of the Company or transfer of all or
a significant portion of its assets unless a successor or
successors (by merger, consolidation or otherwise) to which
all or a significant portion of its assets have been
transferred shall have assumed all duties and obligations of
the Company under this Agreement but without releasing the
Company that is the original party to this Agreement;
provided that in any event set forth in this subparagraph
7.03(b) above, the Executive shall have elected to terminate
his employment under this Agreement upon not less than forty
(40) and not more than ninety (90) days' advance written
notice to the Board of Directors of the Company, attention
of the Secretary, given, except in the case of a continuing
breach, within three calendar months after (A) failure to be
so elected or reelected, or removal, (B) expiration of the
thirty (30) day cure period with respect to such event, or
(C) the closing date of such liquidation, dissolution,
consolidation, merger or transfer of assets, as the case may be.
An election by the Executive to terminate his
employment given under the provisions of this paragraph 7.03
shall not be deemed a voluntary termination of employment by
the Executive for the purpose of this Agreement or any plan
or practice of the Company.
7.04 For the purpose of any provision of this
Agreement, the termination of the Executive's employment
shall be deemed to have been for Cause only:
<PAGE>
(a) if termination of his employment shall
have been the result of an act or acts of dishonesty on the
part of the Executive constituting a felony and resulting or
intended to result directly or indirectly in gain or
personal enrichment at the expense of the Company, or
(b) if there has been a breach by the
Executive during the Period of Employment of the provisions
of Section IX relating to confidential information, and such
breach results in demonstrably material injury to the
Company.
7.05 In the event that the Executive's employment
shall be terminated by the Company during the Period of
Employment and such termination is alleged to be for Cause,
or the Company shall withhold payments or provision of
benefits because the Executive is alleged to be engaged in
Competition in breach of the provisions of paragraph 9.02
below or for any other reason, the Executive shall have the
right, in addition to all other rights and remedies provided
by law, at his election either to seek binding arbitration
within the Racine, Wisconsin area or other mutually
agreeable area under the rules of the American Arbitration
Association, or to institute a judicial proceeding; all
costs of such arbitration or judicial proceeding including
all attorney fees, are to be borne by the Company if the
Executive prevails.
VIII. No Obligation to Mitigate Damages.
----------------------------------
8.01 In the event of a Termination, as defined in
paragraph 7.03 above, the Executive shall not be required to
mitigate the amount of compensation and benefits set forth
in paragraph 7.02 above by seeking employment with others,
or otherwise, nor shall the amount of such compensation and
benefits be reduced or offset in anyway by any income or
benefits earned by Executive from another employer or other
source after the termination becomes effective.
IX. Confidential Information, Non Compete.
-------------------------------------
9.01 The Executive agrees not to disclose,
(either while in the Company's employ, or at any time
thereafter, to any person not employed by the Company, or
not engaged to render services to the Company, except with
the prior written consent of an officer authorized to act in
the matter by the Board of Directors of the Company), any
confidential information obtained by him while in the employ
of the Company, including, without limitation, information
relating to any of the Company's inventions, processes,
formulae, plans, devises, compilations of information,
methods of distribution, customers,, client relationships,
marketing strategies or trade secrets; provided, however,
that this provision shall not preclude the Executive from
use or disclosure of information known generally to the
<PAGE>
public or of information not considered confidential by
persons engaged in the business conducted by the Company or
from disclosure required by law or Court order. The
Agreement herein made in this paragraph 9.01 shall be in
addition to, and not in limitation or derogation of, any
obligations otherwise imposed by law upon the Executive in
respect of confidential information and trade secrets of the
Company, its subsidiaries and affiliates.
9.02 (a) Subject to the provisions of paragraph
7.05 above, there shall be no obligation on the part of the
Company to make any further payments or provide any benefits
required under this Agreement if the Executive shall, during
the period that such payments are being made or benefits
provided, engage in Competition with the Company as
hereinafter defined.
(b) The word "Competition" for the purposes
of this paragraph 9.02 and any other provision of this
Agreement shall mean (i) taking a management position with
or control of a business engaged in the design, development,
manufacture, marketing or distribution of products, which
constituted 5% or more of the sales of the Company and its
subsidiaries and affiliates during the last fiscal year of
the Company preceding the termination of the Executive's
employment, in any geographical area in which the Company,
its subsidiaries or affiliates is at the time engaging in
the design, development, manufacture, marketing or
distribution of such products; provided, however, that in no
event shall ownership of less than 5% of the outstanding
capital stock entitled to vote for the election of directors
of a corporation with a class of equity securities held of
record by more than 500 persons, standing alone, be deemed
Competition with the Company within the meaning of this
paragraph 9.02, (ii) soliciting any person who is a customer
of the businesses conducted by the Company, or any business
in which the Executive has been engaged on behalf of the
Company and its subsidiaries or affiliates at anytime during
the term of this Agreement on behalf of a business described
in clause (i) of this subparagraph 9.02(b) or (iii) inducing
or attempting to persuade any employee of the Company or any
of its subsidiaries or affiliates to terminate his employment
relationship in order to enter into employment with a business
described in clause (i) of this subparagraph 9.02(b).
X. Notices.
-------
10.01 All notices, requests, demands and other
communications provided for by this Agreement shall be in
writing and shall be sufficiently given if and when mailed
in the continental United States by registered or certified
mail or personally delivered to the party entitled thereof
at the address given from time to time by the parties to
this Agreement which address shall be such address as the
addressee may have given most recently by a similar notice.
Any such notice delivered in person shall be deemed to have
been received on the date of delivery.
<PAGE>
XI. General Provisions.
------------------
11.01 There shall be no right of setoff or
counterclaim in respect of any claim, debt or obligation
against any payments to the Executive, his dependents,
beneficiaries or estate, provided for in this Agreement.
11.02 The Company and the Executive recognize that
each party will have no adequate remedy at law for breach by
the other of any of the agreements contained in this
Agreement and, in the event of any such breach, the Company
and the Executive hereby agree and consent that the other
shall be entitled to a decree of specific performance,
mandamus or other appropriate remedy to enforce performance
of such agreements.
11.03 No right or interest to or in any payments
shall be assignable by the Executive; provided, however,
that this provision shall not preclude him from designating
one or more beneficiaries to receive any amount that may be
payable after his death and shall not preclude the legal
representative of his estate from assigning any right
hereunder to the person or persons entitled thereto under
his will or, in the case of intestacy, to the person or
persons entitled thereto under the laws of intestacy
applicable to his estate.
11.04 (a) No right, benefit or interest
hereunder, shall be subject to anticipation, alienation,
sale,, assignment, encumbrance, charge, pledge,
hypothecation, or setoff in respect of any claim, debt or
obligation, or to execution, attachment, levy or similar
process, or assignment by operation of law. Any attempt,
voluntary or involuntary, to effect any action specified in
the immediately preceding sentence shall, to the full extent
permitted by law, be null, void and of no effect.
(b) Except as herein provided, the
Executive shall not have any present right, title, or
interest whatsoever in or to any investments which the
Company may make to aid it in meeting its obligations under
this Agreement. Nothing contained in this Agreement shall
create or be construed to create a trust of any kind, or a
fiduciary relationship between the Company and the Executive
or any other person.
11.05 The term "beneficiaries" as used in this
Agreement shall, in the event of the death of the Executive,
include any person, including a corporate or individual
beneficiary designated by the Executive in a written
instrument in form acceptable to and filed with the Company.
In the absence of such designation, or if the designation is
invalid for any reason, the benefits shall then be paid to
the Executive's estate.
11.06 In the event of the Executive's death or a
judicial determination of his incompetence, reference in
<PAGE>
this Agreement to the Executive shall be deemed, where
appropriate, to refer to his legal representative or, where
appropriate, to his beneficiary or beneficiaries.
11.07 This Agreement shall be binding upon and
shall inure to the benefit of the Executive, his heirs and
legal representatives, and the Company and its successors,
including ,without limitation, any corporate or corporations
acquiring directly or indirectly all or substantially all of
the assets of the Company whether by merger, consolidation,
sale or otherwise (and such successors shall thereafter be
deemed embraced with the term "the Company" for the purposes
of this Agreement).
11.08 The validity, interpretation, construction,
performance and enforcement of this Agreement shall be
governed by the laws of the State of Wisconsin.
XII. Amendment or Modification.
-------------------------
12.01 No provision of this Agreement may be
amended, modified or waived unless such amendment,
modification or waiver shall be authorized by the Board of
Directors of the Company or any authorized committee of the
Board of Directors and shall be agreed to in writing, signed
by the Executive and by an officer of the Company hereunto
duly authorized.
XIII. Severability.
------------
13.01 In the event that any provision of this
Agreement, or portion thereof, shall be determined to be
invalid or unenforceable for any reason, in whole or in
part, the remaining provisions of this Agreement and parts
of such provision not so invalid or unenforceable shall be
unaffected thereby and shall remain in full force and effect
to the fullest extent permitted by law.
XIV. Change in Control.
-----------------
14.01 For the purpose of this Agreement, the term
"Change in Control of the Company' shall mean a change in
control of a nature that would be required to be reported in
response to Item 5(f) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934 as in
effect on the date of this Agreement; provided that, without
limitation, such a change in control shall be deemed to have
occurred if and when (a) any "person" (as such term is used
in Sections 13(d) and 14(d)(2) of the Securities Exchange
Act of 1934) is or becomes a beneficial owner, directly or
indirectly, of securities of the Company representing
thirty-five percent (35%) or more of the combined voting
power of the Company's then outstanding securities or
<PAGE>
(b) during any period of 24 consecutive months, commencing
before or after the date of this Agreement, individuals who
at the beginning of such twenty-four (24) month period were
directors of the Company cease for any reason to constitute
at least a majority of the Board of Directors of the
Company.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement this 25th day of Oct. , 1996.
------- ------
MODINE MANUFACTURING COMPANY
BY: R. T. SAVAGE
--------------------------
Chairman of the Board and
Chief Executive Officer
(SEAL)
Attest:
W. E. PAVLICK
- ------------------------
Secretary
D. R. JOHNSON
--------------------------
Executive
<PAGE>
EXHIBIT A
Title
President The President shall be the Chief Operating
Officer of the Company and, subject of the
control of the Board of Directors and the
Chairman of the Board and Chief Executive
officer, shall supervise and control the
operations of the Company. In the absence
of the CEO or in the event of his death,
inability or refusal to act, or in the event
for any reason it shall be impracticable for
the CEO to act personally, the President shall
perform the duties of the CEO, and when so
acting, shall have all the powers of and be
subject to all the restrictions upon the CEO.
<PAGE>
