<PAGE> 1
As filed with the Securities and Exchange Commission on August 20, 1999.
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
MOTIVEPOWER INDUSTRIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
Pennsylvania 82-046101
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
Two Gateway Center, 14th Floor
Pittsburgh, PA 15222
(Address of Principal Executive Offices)
MOTIVEPOWER INDUSTRIES, INC.
STOCK INCENTIVE PLAN
(Full Title of the Plan)
Jeannette Fisher-Garber
Vice President, Secretary and General Counsel
MotivePower Industries, Inc.
Two Gateway Center, 14th Floor
Pittsburgh, PA 15222
(412) 201-1101
(Name, Address and Telephone Number of Agent for Service)
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
Proposed
Proposed Maximum Amount
Title of Amount Maximum Aggregate of
Securities To Be Offering Price Offering Registra-
to be Registered Registered Per Share Price tion Fee
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares of Common Stock, $0.01 3,000,000 shares $13.56 (1) $40,677,941 (1) $11,309
par value
Preferred Stock Purchase 3,000,000 rights (2) (2) (2)
Rights
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rules 457(c) and 457(h)(1) under the Securities Act of
1933, the Proposed Maximum Offering Price Per Share is based upon (a)
the weighted average of the prices at which the options may be
exercised for options for which the exercise prices are known ($11.32
per share for 846,814 shares), and (b) for the remaining options, the
reported average of the high and low prices for the Registrant's common
stock on the New York Stock Exchange on August 18, 1999 ($14.44 per
share for 2,153,186 shares).
(2) The Preferred Stock Purchase Rights are evidenced by certificates for
shares of MotivePower Common Stock and automatically trade with
MotivePower Common Stock. Value attributable to such Preferred Stock
Purchase Rights, if any, is reflected in the market price of the
MotivePower Common Stock.
On June 23, 1994, the Registrant filed a registration statement or Form
S-8 (File No. 033-80702) to register 2,250,000 shares of the Registrant (as
adjusted from 1,500,000 shares to give effect to the Registrant's 3 for 2 stock
split on April 2, 1999) relating to the MotivePower Industries, Inc. Stock
Incentive Plan (formerly the MK Rail Corporation Stock Incentive Plan) is
effective.
<PAGE> 3
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Item 1. Plan Information*
Item 2. Registrant Information and Employee Plan Annual Information*
*Information required by Part I to be contained in the Section 10(a) prospectus
is omitted from the Registration Statement in accordance with Rule 428 under the
Securities Act of 1933 and the Note to Part I of Form S-8.
REOFFER PROSPECTUS
Up to 2,000,000 Shares
MOTIVEPOWER INDUSTRIES, INC.
Common Stock
This Prospectus relates to up to 2,000,000 shares of our common stock
which the people identified under "Selling Shareholders" may offer and sell from
time to time in one or more types of transactions (which may include block
transactions) on the New York Stock Exchange, where our common stock is listed
for trading under the symbol "MPO," in other markets where our common stock is
traded, in negotiated transactions, through put or call options transactions,
through short sales transactions, or in a combination of such methods of sale.
They will sell the common stock at prices to which the parties agree. The
selling shareholders may or may not use brokers and dealers in these
transactions. The respective selling shareholders will pay any brokerage fees or
commissions relating to sales by them. See "Method of Sale."
We may issue these shares of common stock to the selling shareholders
upon the exercise by the selling shareholders of options we have previously
awarded to them. In addition, we have issued to the selling shareholders an
aggregate of 225,000 shares of our common stock which, when issued, were subject
to restrictions on transfer and encumbrance for a specified period of time.
We will not receive any of the proceeds from any sales by the selling
shareholders. We will pay all of the expenses associated with the registration
of the common stock and this Prospectus.
On August 18, 1999, the last reported sale price of the common stock on
the New York Stock Exchange was $13.63 per share.
SEE "RISK FACTORS" BEGINNING ON PAGE 3 OF THIS PROSPECTUS FOR A
DISCUSSION OF CERTAIN RISKS AND OTHER FACTORS THAT YOU SHOULD CONSIDER BEFORE
PURCHASING OUR COMMON STOCK.
-----------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, and they have not
determined if this Prospectus is truthful and complete. Any representation to
the contrary is a criminal offense.
-----------
The date of this Prospectus if August 20, 1999.
1
<PAGE> 4
We have not authorized anyone to give any information or to make any
representation which is not contained in this Prospectus or in a document
incorporated by reference into this Prospectus. If anyone gives any information
or makes any representation which is not contained in, or incorporated into this
Prospectus, you must not rely upon it as having been authorized by us or by
anyone acting on our behalf. This Prospectus is not an offer to sell, or a
solicitation of an offer to buy, our securities by any person in any
jurisdiction in which it is unlawful for that person to make such an offer or
solicitation. No matter when you receive this Prospectus or purchase securities
to which it relates, you must not assume it is correct at any time after its
date.
TABLE OF CONTENTS
Heading: Page Number
The Company ............................................................. 2
Proposed Merger ......................................................... 2
Risk Factors ............................................................ 3
Selling Shareholders .................................................... 9
Use of Proceeds ......................................................... 9
Method of Sale .......................................................... 9
Where You Can Find More Information ..................................... 10
Legal Matters ........................................................... 11
Experts ................................................................. 11
Annex I - Selling Shareholders .......................................... 12
THE COMPANY
MotivePower is a leader in the manufacturing and distribution of
products for rail and other power-related industries, and also provides a
variety of related contract services. MotivePower provides products and services
to freight and passenger railroads, including every Class I railroad in North
America, metropolitan transit and commuter rail authorities, original equipment
manufacturers, industrial power-related markets and other customers
internationally. MotivePower has its headquarters in Pittsburgh, Pennsylvania
and other strategically located facilities in the United States, Canada and
Mexico.
MotivePower was incorporated in Delaware in 1994 and became a
Pennsylvania corporation through its merger into a wholly-owned subsidiary in
April 1999.
MotivePower's principal executive offices are located at Two Gateway
Center, 14th Floor, Pittsburgh, Pennsylvania 15222, telephone number (412)
201-1101.
PROPOSED MERGER
The Boards of Directors of MotivePower and Westinghouse Air Brake
Company have approved a merger agreement which provides for a combination of the
two companies. If the merger is completed, holders of WABCO common stock will
receive, for each WABCO share, 1.3 shares of MotivePower common stock.
MotivePower shareholders will continue to own their existing shares after the
merger.
The Boards of Directors of MotivePower and WABCO have asked the
shareholders to approve and adopt the merger agreement and the merger at special
meetings of the companies scheduled to be held on August 23, 1999. The merger
cannot be completed unless the shareholders of both companies approve it.
2
<PAGE> 5
RISK FACTORS
TERMINATION FEES AND RECIPROCAL STOCK OPTION AGREEMENTS COULD DETER ALTERNATIVE
TRANSACTIONS BY MAKING THEM MORE DIFFICULT OR EXPENSIVE.
MotivePower or WABCO must pay to the other a termination fee of $15
million plus up to $2 million in expenses if the merger agreement proposed to be
entered into by the parties terminates under specified circumstances.
MotivePower and WABCO have also entered into reciprocal stock option agreements
which provide MotivePower and WABCO the right to acquire up to 19% of the
other's outstanding common stock under specified conditions, with the profit
either party can derive from the option limited to $15 million. The termination
fees and the stock option agreements could deter either MotivePower or WABCO
from entering into an alternative transaction by making an alternative
transaction more difficult or expensive. Among other effects, the stock option
agreements could prevent an alternative business combination with WABCO or
MotivePower from being accounted for as a "pooling of interests." The stock
option agreements may therefore discourage proposals for alternative business
combinations with WABCO or MotivePower, even if a third party were prepared to
offer shareholders of WABCO or MotivePower consideration with a higher market
value than the value of the MotivePower stock to be exchanged for WABCO stock in
the merger.
THE COMBINED COMPANY MAY NOT BE ABLE TO REALIZE THE COST SAVINGS AND OTHER
SYNERGIES OF THE MERGER OR SUCCESSFULLY INTEGRATE THE OPERATIONS OF MOTIVEPOWER
AND WABCO.
The merger involves the integration of two companies that have
previously operated independently. WABCO and MotivePower expect to realize
significant cost savings and other synergies from the merger, but the combined
company may not be able to achieve these synergies or cost savings. Further, the
costs of achieving these synergies may be significantly greater than we
anticipate. MotivePower and WABCO estimate that the direct costs of the merger
will be approximately $20-25 million. MotivePower and WABCO also estimate that
MotivePower will incur integration-related expenses, including severance, of
approximately $35-40 million. These expenses may impact the combined company
going forward. In addition, if these costs and expenses are higher than
estimated, the merger benefits may be reduced. MotivePower and WABCO will also
need to integrate numerous systems, including management information,
purchasing, accounting and finance, sales, billing and payroll, which will
require substantial attention from management. MotivePower and WABCO do not
expect that they will complete their systems integration before the end of 1999.
Diversion of management attention to and difficulties associated with
integrating MotivePower and WABCO could harm the operating results of the
combined company and impact the value of its common stock.
THE COMBINED COMPANY'S ABILITY TO EXPAND ITS INTERNATIONAL OPERATIONS MAY BE
LIMITED BY THE NEED TO OBTAIN ADDITIONAL REGULATORY APPROVALS IN FOREIGN
JURISDICTIONS AND THE NEED TO MEET LOCAL EQUIPMENT REQUIREMENTS.
MotivePower and WABCO conduct international operations through a
variety of wholly-owned subsidiaries, majority-owned subsidiaries and equity
interests located in the United States, Canada, Mexico, Europe, Australia and
Asia. MotivePower and WABCO are also exploring the possibility of expansion into
other international markets. The combined company's ability to expand sales of
its products internationally, in particular its locomotive and freight braking
products, is limited by the necessity of obtaining regulatory approval in new
jurisdictions. For example, local regulatory approval is required in order to
market WABCO's brake shoes in India. The combined company's international growth
strategy can also be hampered by the additional expense of modifying products to
comply with local railroad equipment requirements.
3
<PAGE> 6
THE COMBINED COMPANY'S FINANCIAL PERFORMANCE ON A U.S. DOLLAR-DENOMINATED BASIS
MAY BE SIGNIFICANTLY AFFECTED BY FLUCTUATIONS IN CURRENCY EXCHANGE RATES.
The combined company's international operations also pose risks due to
currency exchange rates. The combined company's financial performance is
reported on a U.S. dollar-denominated basis. However, MotivePower's and WABCO's
international operations are generally conducted in the currencies of the
countries in which such operations are located. Fluctuations in currency
exchange rates can negatively impact the combined company's financial results.
FLUCTUATIONS IN CUSTOMER ORDERS IN THE RAILWAY INDUSTRY DUE TO ECONOMIC
CONDITIONS AND ALTERNATE FORMS OF TRANSPORTATION CAN REDUCE THE COMBINED
COMPANY'S REVENUES AND HARM ITS FINANCIAL RESULTS.
The railway industry has historically been subject to significant
fluctuations due to overall economic conditions and the level of use of
alternate methods of transportation. In economic downturns, railroads may defer
some expenditures in order to conserve cash in the short term and reductions in
freight traffic may reduce demand for the combined company's products. This
could reduce the combined company's revenues without a corresponding decrease in
its fixed costs. This can negatively impact the combined company's financial
results. We cannot assure you that the economic conditions will remain favorable
or that there will not be significant fluctuations adversely affecting the
industry as a whole and, as a result, the combined company.
CYCLICALITY IN THE PASSENGER TRANSIT INDUSTRY CAN REDUCE THE COMBINED COMPANY'S
REVENUES AND HARM ITS FINANCIAL RESULTS.
Although many industries tend to be cyclical, the passenger transit
railway industry is particularly so. New passenger transit car orders vary from
year to year and are influenced greatly by major replacement programs and by the
construction or expansion of transit systems by transit authorities. Although
the combined company's revenues may be reduced at any time due to lack of orders
from the passenger transit industry, its fixed costs which are necessary to be
prepared for busy periods may stay the same. This can negatively impact the
combined company's financial results.
BECAUSE A MATERIAL PORTION OF THE COMBINED COMPANY'S FUTURE NET SALES WILL
DERIVE FROM GOVERNMENTAL OR OTHER PUBLIC ENTITIES, AND NOT PRIVATE COMPANIES, IT
CAN BE NEGATIVELY AFFECTED BY CHANGES IN POLITICAL, ECONOMIC OR SIMILAR
CONDITIONS.
A substantial portion of WABCO's net sales have been, and WABCO and
MotivePower expect that a substantial portion of the combined company's future
net sales may be, derived from contracts with metropolitan transit and commuter
rail authorities and Amtrak. To the extent that future funding for proposed
public projects is curtailed or withdrawn altogether as a result of changes in
political, economic, fiscal or other conditions beyond the combined company's
control, these projects may be delayed or canceled, resulting in a potential
loss of new business.
INTELLECTUAL PROPERTY INFRINGEMENT CLAIMS MAY REQUIRE THE COMBINED COMPANY TO
USE ITS CASH TO PAY FOR LEGAL FEES AND SETTLEMENTS OR JUDGMENTS.
The combined company may be the subject of intellectual infringement
claims by third parties. Any infringement claims, even if meritless, will be
costly and time-consuming to defend. GE Harris Railway Electronics, LLC and GE
Harris Railway Electronic Services, LLC have brought suit against WABCO for
alleged patent infringement and unfair competition related to a communications
system installed in one of WABCO's products. These GE Harris entities are
seeking to prohibit WABCO from future infringement and are seeking an
unspecified amount of money damages to recover, in part, royalties. WABCO is
defending, and the combined company will continue to defend, these claims.
However, if the combined company is not successful, it may require the combined
company to use its cash to pay for legal fees and settlements or judgments.
4
<PAGE> 7
YEAR 2000 ISSUES MAY NEGATIVELY AFFECT THE COMBINED COMPANY'S OPERATIONS AND THE
COMBINED COMPANY'S SUPPLIERS OR CUSTOMERS IN A MANNER WHICH COULD IMPACT THE
COMBINED COMPANY'S BUSINESS.
The Year 2000 problem is the result of computer programs using two
digits rather than four to define the applicable year. Any of MotivePower's and
WABCO's computer programs that use two digits rather than four digits to specify
the year will be unable to interpret dates beyond December 31, 1999. This
problem could result in a system failure or miscalculations causing disruptions
of operations. The three major areas that could be critically affected are
financial and information system applications, manufacturing operations and
third-party relationships with vendors and with customers. MotivePower and WABCO
have developed plans to address this exposure. MotivePower and WABCO have
assessed financial and operational systems and manufacturing equipment,
developed and continue to develop detailed plans and have commenced conversion
efforts. Each of MotivePower and WABCO believes that its present remediation and
replacement programs will adequately address the Year 2000 problems with respect
to their internal systems in all material respects. However, the combined
company may experience minor disruptions with respect to the remediation and
replacement programs that are currently operating. In addition, MotivePower's
and WABCO's vendors, suppliers and other service providers may not successfully
resolve their own Year 2000 problems in a manner which avoids significant impact
to MotivePower and WABCO. MotivePower and WABCO have received written assurances
from some of their suppliers and customers and other providers acknowledging the
Year 2000 problems and stating their present intention to be compliant.
MotivePower and WABCO have not received assurances from all of their suppliers
and other providers and one or more key suppliers and other providers could fail
to become compliant in time to avoid a disruption to the combined company's
business.
A Year 2000 failure of the combined company's systems, or those of key
suppliers or other providers, could cause disruptions of its business. These
disruptions could include a slowdown or shutdown of production, an inability to
invoice or collect from customers, an inability to receive critical supplies or
a reduction in customer orders. Any one or more of these could harm the combined
company's financial results.
MotivePower's and WABCO's products are generally sold with a limited
warranty for defects. MotivePower and WABCO have reviewed their products
currently in use by their customers or being sold and do not believe that there
will be material increases in warranty or liability claims arising out of Year
2000 non-compliance. However, a material increase in such claims could require
the combined company to apply substantial amounts of money or time to correct
any defects.
FOLLOWING THE MERGER THE COMBINED COMPANY WILL HAVE SUBSTANTIAL LEVERAGE AND
SERVICING DEBT WILL REQUIRE A SUBSTANTIAL PORTION OF THE COMBINED COMPANY'S CASH
FLOWS.
Following the merger, MotivePower's leverage will increase as a result
of the assumption of WABCO's indebtedness. On a pro forma basis, after giving
effect to the merger, total indebtedness of the combined company as of December
31, 1998 would have been $573.6 million resulting in pro forma total
capitalization of the combined company of approximately 80% debt and 20% equity,
exclusive of the effect of any prepayment premiums, costs of refinancing or
costs of the merger, compared with actual company total indebtedness of $105.8
million and total capitalization of 37% debt and 63% equity as of December 31,
1998. The additional indebtedness will require the combined company to dedicate
a substantial portion of its future cash flow to the payment of principal and
interest on this indebtedness, thereby reducing funds available for capital
expenditures and future business opportunities. The combined company may choose
to refinance a significant portion of WABCO's and MotivePower's outstanding
long-term debt. In addition, management has plans to reduce indebtedness, but we
cannot be certain that we will be successful in either refinancing or reducing
the indebtedness of the combined company. The high level of debt may
-- limit the combined company's ability to fund future working
capital, capital expenditures, research and development costs
and other general corporate requirements,
5
<PAGE> 8
-- increase the combined company's vulnerability to adverse
economic and industry conditions,
-- limit the combined company's flexibility in planning for, or
reacting to, changes in the combined company's business and
the industry,
-- place the combined company at a competitive disadvantage
compared to its competitors that have less debt, and
-- limit the combined company's ability to borrow additional
funds.
WABCO'S CURRENT CREDIT FACILITIES LIMIT ITS ABILITY TO TAKE CERTAIN ACTIONS
WHICH MAY REQUIRE ACCELERATED REPAYMENT OF INDEBTEDNESS AFTER THE MERGER AND
WILL LIMIT THE COMBINED COMPANY'S ABILITY TO ENTER INTO SOME TRANSACTIONS AND TO
INCUR ADDITIONAL INDEBTEDNESS AFTER THE MERGER.
Indebtedness under WABCO's current credit agreement is guaranteed by
all of WABCO's domestic subsidiaries and secured by substantially all of WABCO's
and its domestic subsidiaries' assets. WABCO's current credit agreement contains
covenants that, among other things, limit the payment of dividends and the
incurrence of additional debt and restricts mergers, acquisitions and sales of
assets or sales of the stock of WABCO's subsidiaries. WABCO is also required to
maintain specified financial ratios and meet other financial tests. Although
WABCO and MotivePower believe that the combined company will be able to maintain
compliance with the financial tests contained in WABCO's current credit
agreement, there can be no assurance that it will be able to do so. The
restrictions imposed by these covenants may adversely affect the combined
company's ability to make acquisitions or take advantage of favorable business
opportunities.
WABCO believes that the proposed merger with MotivePower will
constitute an event of default under WABCO's credit agreement but not directly
under either of its indentures. WABCO anticipates receiving a waiver or
renegotiating its credit agreement prior to the merger. However, WABCO may not
receive this waiver or renegotiate the credit agreement on favorable terms. If
WABCO does not receive a waiver or successfully renegotiate the credit agreement
prior to the merger, a portion of WABCO's indebtedness would be payable.
The indentures under which WABCO's 9 3/8% Notes due 2005 were issued
also contain covenants that, among other things, limit the ability of WABCO and
some of its subsidiaries to:
-- incur indebtedness,
-- pay dividends on and redeem capital stock,
-- create restrictions on investments in unrestricted
subsidiaries,
-- make distributions from some subsidiaries,
-- use proceeds from the sale of assets and subsidiary stock,
-- enter into transactions with affiliates,
-- create liens and
-- enter into sale/leaseback transactions.
WABCO's requirement to meet the foregoing covenants impacts the manner
in which it operates its business and will limit the manner in which the
combined company operates after the merger. It could limit the combined
company's ability to spend money on capital projects, research and development
costs, or similar items.
6
<PAGE> 9
It could also make the combined company unable to complete acquisitions or to
take advantage of favorable business opportunities. Further, the combined
company's failure to meet any of the foregoing covenants could trigger defaults
under the WABCO credit facilities. The documents for the WABCO credit facilities
are cross-defaulted, so that defaults in one document would trigger defaults in
others and could cause the related indebtedness to become payable.
WABCO IS CURRENTLY INVOLVED IN ASBESTOS LITIGATION WHICH COULD, UNDER CERTAIN
CIRCUMSTANCES, REQUIRE THE COMBINED COMPANY TO USE SUBSTANTIAL AMOUNTS OF CASH
FOR LEGAL FEES AND SETTLEMENTS OR JUDGMENTS.
WABCO and Railroad Friction Products Corporation and Vapor Corporation,
each wholly-owned subsidiaries of WABCO, are defendants in asbestos bodily
injury actions pending in various state and federal jurisdictions. WABCO
believes that pursuant to the asset purchase agreement by which it acquired the
North American operations of the railway products group of American Standard,
Inc., American Standard remains liable for all asbestos claims filed against
WABCO. Although WABCO believes that American Standard is willing and able to
fulfill its indemnity obligation, there can be no assurance that American
Standard will not dispute or become unable to perform its obligations. If this
occurs, the combined company would be required to use its cash to pay for legal
fees and settlements or judgments related to the asbestos claims.
With respect to asbestos claims against Railroad Friction Products
Corporation, WABCO believes that the American Standard asset purchase agreement
requires American Standard to indemnify WABCO and Railroad Friction Products
Corporation for 50% of any liability and defense costs Railroad Friction
Products Corporation may incur with respect to asbestos claims. The remaining
costs are covered by insurance. American Standard's indemnity obligation with
respect to Railroad Friction Products Corporation claims expires in March 2000
in connection with claims that are initiated after that date. Again, although
WABCO believes that American Standard is willing and able to fulfill its
indemnity obligation with respect to Railroad Friction Products Corporation
asbestos claims, there can be no assurance that American Standard will not
dispute or become unable to perform its obligations. In addition, claims may be
made after American Standard's indemnification obligations expire and/or the
coverage afforded by insurance may at some time in the future be exhausted or
unavailable. If this occurs, the combined company would be required to use its
cash to pay for legal fees and settlements or judgments related to the asbestos
claims.
Finally, WABCO believes that Mark IV Industries, Inc., the former owner
of Vapor is obligated to indemnify WABCO and Vapor for asbestos claims against
Vapor. Although WABCO believes that Mark IV is willing and able to fulfill its
indemnity obligation with respect to Vapor asbestos claims, there can be no
assurance that Mark IV will not dispute or become unable to perform its
obligations. If this occurs, the combined company would be required to use its
cash to pay for legal fees and settlements or judgments related to the asbestos
claims.
MOTIVEPOWER'S ANTI-TAKEOVER DEFENSE PROVISIONS MAY DETER POTENTIAL ACQUIRORS AND
MAY DEPRESS ITS STOCK PRICE.
MotivePower's articles of incorporation and bylaws contain provisions
that could have the effect of making it more difficult for a third party to
acquire, or of discouraging a third party from attempting to acquire, control of
MotivePower. These provisions allow MotivePower to issue preferred stock with
rights senior to those of its common stock and impose various procedural and
other requirements that could make it more difficult for MotivePower
shareholders to effect some corporate actions.
In addition, under MotivePower's shareholder rights plan, holders of
MotivePower common stock are entitled to one preferred share purchase right for
each outstanding share of common stock they hold, exercisable under specified
circumstances involving a potential change of control. The preferred share
purchase rights have the anti-takeover effect of causing substantial dilution to
a person or group that attempts to acquire MotivePower on terms not approved by
the MotivePower Board. The foregoing provisions could reduce the premium that
7
<PAGE> 10
potential acquirors might be willing to pay in an acquisition or that investors
might be willing to pay in the future for shares of MotivePower common stock.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
We have made forward-looking statements in this document and in the
documents which are incorporated by reference that are subject to risks and
uncertainties. For those statements, we claim the protection of the safe harbor
for forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995. You should understand that the following important factors,
in addition to those discussed elsewhere in this document and in the documents
which are incorporated by reference, could affect the future results of
MotivePower and WABCO, and of the combined company after the closing, and could
cause those results or other outcomes to differ materially from those expressed
in our forward-looking statements:
Economic and Industry Conditions
-- materially adverse changes in economic or industry conditions
generally or in the markets served by our companies, including
North America, South America, Europe, Australia and Asia
-- demand for services in the freight and passenger rail industry
-- consolidations in the rail industry
-- demand for our products and services
-- continued outsourcing by our customers
-- demand for freight cars, locomotives, passenger transit cars
and buses
-- industry demand for faster and more efficient braking
equipment
-- fluctuations in interest rates
Operating Factors
-- supply disruptions
-- technical difficulties
-- changes in operating conditions and costs
-- successful introduction of new products
-- labor relations
-- completion and integration of additional acquisitions
-- the development and use of new technology
-- year 2000 disruptions
8
<PAGE> 11
Competitive Factors
-- the actions of competitors
Political/Governmental Factors
-- political stability in relevant areas of the world
-- future regulation/deregulation of our customers
and/or the rail industry
-- governmental funding for some of our customers
-- political developments and laws and regulations, such
as forced divestiture of assets, restrictions on
production, imports or exports, price controls, tax
increases and retroactive tax claims, expropriation
of property, cancellation of contract rights, and
environmental regulations
Transaction or Commercial Factors
-- the outcome of negotiations with partners,
governments, suppliers, customers or others
-- our ability to integrate the businesses of
MotivePower and WABCO successfully after the merger.
SELLING SHAREHOLDERS
The table attached as Annex I hereto sets forth, as of the date of this
Prospectus or a subsequent date if amended or supplemented, (a) the name of each
selling shareholder and his or her relationship to MotivePower during the past
three years; (b) the number of shares of common stock each selling shareholder
beneficially owns (assuming that all options and restricted shares which they
have previously been granted are fully vested and free from restrictions on
transfer); (c) the number of shares of common stock offered pursuant to this
Prospectus by each selling shareholder; and (d) the amount and percentage of the
common stock outstanding to be held by such selling shareholder after giving
effect to the offering of the common stock covered by this Prospectus. The
information contained in Annex I may be amended or supplemented from time to
time.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of common stock
by selling shareholders covered by this Prospectus.
METHOD OF SALE
This Prospectus relates to the possible offer and sale from time to
time by the selling shareholders of their shares of common stock which they may
receive upon the exercise of options or which they now hold and may sell upon
the lapse of restrictions on transfer, if any. We have registered their shares
for resale to provide them with freely tradeable securities. However,
registration of their shares does not necessarily mean that they will offer or
sell any of their shares. We will not receive any proceeds from the offering or
sale of their shares.
The selling shareholders may offer and sell the shares of common stock
to which this Prospectus relates from time to time in one or more types of
transactions (which may include block transactions) on the New York Stock
exchange, where our common stock is listed for trading under the symbol"MPO," in
other markets where our common stock is traded, in negotiated transactions,
through put or call options transactions, through short
9
<PAGE> 12
sales transactions, or in a combination of such methods of sale. They will sell
the common stock at prices which are current when the sales take place or at
other prices to which the parties agree. The respective selling shareholders may
use brokers or dealers to sell the shares, and will pay any brokerage fees or
commissions relating to sales by them in amounts to be negotiated by them prior
to sale. The selling shareholders and any brokers or dealers participating in
the sale of the common stock may be deemed to be "underwriters" within the
meaning of the Securities Act of 1933, as amended (the "Securities Act"), and
any discounts and commissions received by them and any profit realized by them
on the resale of the shares may be deemed to be underwriting discounts and
commissions under the Securities Act. Some shares may also be sold by other
people or entities which receive the shares from one or more of the selling
shareholders by gift, by operation of law (including the laws of descent and
distribution) or by other transfers or assignments.
Selling shareholders also may resell all or a portion of their shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of such Rule.
WHERE YOU CAN FIND MORE INFORMATION
MotivePower files annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
reports, statements or other information we file at the SEC's public reference
rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please call
the SEC at 1-800-SEC-0330 for further information on the public reference rooms.
Our SEC filings are also available to the public from commercial document
retrieval services and at the web site maintained by the SEC at
http://www.sec.gov.
This prospectus is a part of a registration statement on Form S-8 filed
by MotivePower with the SEC. As allowed by SEC rules, this prospectus does not
contain all the information you can find in the registration statement or the
exhibits to the registration statement.
The SEC allows us to "incorporate by reference" information into this
prospectus, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. When we file
documents in accordance with Sections 13(a), 13(c), 14 and 15(d) of the
Securities Exchange Act of 1934 between the date of this prospectus and the time
we file a post-effective amendment to the registration statement reporting that
all the securities which are the subject of the registration statement have been
sold or deregistering any securities which have not been sold, those documents
we file will be incorporated into this prospectus and will be a part of it
beginning on the date those documents are filed. If any document which we file
changes anything said in this prospectus or in an earlier document which is
incorporated into this prospectus, the later document will modify or supersede
what is said in this prospectus or the earlier document.
This prospectus also incorporates by reference the documents set forth
below that we have previously filed with the SEC. These documents contain
important information about MotivePower.
10
<PAGE> 13
<TABLE>
<CAPTION>
REPORT PERIOD OR FILING DATE SEC FILE NO.
<S> <C> <C>
Annual Report on Form 10-K Fiscal Year ended December 31, 1998 001-13225
Quarterly Report Form 10-Q Filed on May 14, 1999 001-13225
Quarterly Report Form 10-Q Filed on August 16, 1999 001-13225
Current Report on Form 8-K Filed on June 3, 1999 001-13225
Current Report on Form 8-K Filed on August 18, 1999 001-13225
The description of MotivePower common Filed on May 4, 1999 001-13225
stock set forth in the Registration
Statement on Form 8-A
The description of share purchase Filed on May 4, 1999 and amended on 001-13225
rights set forth in the Registration June 3, 1999
Statement on Form 8-A
Registration Statement on Form S-4 Filed on July 20, 1999 333-83221
</TABLE>
Documents incorporated by reference are available from us without
charge, excluding all exhibits unless we have specifically incorporated by
reference an exhibit in this prospectus. Shareholders may obtain documents
incorporated by reference in this prospectus by requesting them in writing or by
telephone from Two Gateway Center, 14th Floor, Pittsburgh, PA 15222, Tel: (412)
201-1101.
LEGAL MATTERS
The validity of the shares offered hereby will be passed upon for
MotivePower by Doepken Keevican & Weiss Professional Corporation, Pittsburgh,
Pennsylvania.
EXPERTS
The consolidated financial statements and the related financial
statement schedule incorporated in this prospectus by reference from the
Company's Annual Report on Form 10-K for the year ended December 31, 1998 have
been audited by Deloitte & Touche LLP, independent auditors, as stated in their
reports, which are incorporated herein by reference, and have been so
incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
The Westinghouse Air Brake Company consolidated financial statements
and schedules as of December 31, 1998 and 1997 and for the years ended December
31, 1998, 1997 and 1996 incorporated in this prospectus which is part of this
registration statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and have
been so incorporated in reliance upon the authority of said firm as experts in
giving said reports.
11
<PAGE> 14
ANNEX I
SELLING SHAREHOLDERS (1)
<TABLE>
<CAPTION>
Shares Beneficially Owned
After Offering: (2)
------------------------------------------------
Percentage
Relationships Shares Shares following
to the Beneficially Offered WABCO
Name Company Owned Hereby Number Percentage merger
- -------------------- ---------------- --------------- ----------- ------------ ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
John C. Pope (3) Chairman 917,628 562,500 355,128 1.3% 0.5%
Michael A. Wolf (4) President, 1,093,234 825,000 268,234 1.0% 0.4%
Chief
Executive
Officer and
Director
</TABLE>
- --------------
(1) Assumes that all options held by the listed individuals are fully
vested and exercisable and that all restricted shares held are freely
transferable without restriction. Shares deemed beneficially owned by
virtue of these assumptions are treated as outstanding for purposes of
determining beneficial ownership by such individual.
(2) Assumes the sale of all securities offered hereby irrespective of
whether there is any present intention to do so.
(3) The shares beneficially owned by Mr. Pope consist of 208,622 shares
owned of record by him or held in a 401(k) plan of which he is the
beneficiary, including 112,500 shares issued to Mr. Pope under the Plan
which were subject to restrictions on transfer when issued; 450,000
shares issuable to him upon the exercise of a currently exercisable
option at an exercise price of $7.15 per share; and 259,006 shares held
in a deferred compensation plan as to which he bears the economic risk
of ownership.
(4) The shares beneficially owned by Mr. Wolf consist of 408,037 owned of
record by him, his spouse or trusts or 401(k) plans of which he or his
spouse is a beneficiary, including 225,000 shares issued to Mr. Wolf
under the Plan which were subject to restrictions on transfer when
issued; 600,000 shares issuable to him upon the exercise of a currently
exercisable option at an exercise price of $5.19 per share; and 85,197
shares held in a deferred compensation plan as to which he bears the
economic risk of ownership.
12
<PAGE> 15
PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents previously filed with the Securities and
Exchange Commission by MotivePower Industries, Inc., a Pennsylvania corporation
("MotivePower" or the "Company"), are incorporated herein by reference and shall
be deemed to be a part hereof:
(a) The description of common stock of the Company contained
in the Registration Statement on Form 8-A filed by the Company with the
Securities and Exchange Commission (the "Commission") on May 4, 1999
(SEC File No. 001-13225);
(b) The description of the share purchase rights of the
Company contained in the Registration Statements on Form 8-A filed with
the Commission on May 4, 1999 and the amendment thereto on Form 8-A/A
filed with the Commission on June 3, 1999 (SEC File No. 001-13225);
(c) The Company's Annual Report on Form 10-K for the year
ended December 31, 1998 (SEC File No. 001-13225);
(d) The Company's Quarterly Report on Form 10-Q for the three
months ended March 31, 1999 (SEC File No. 001-13225);
(e) The Company's Quarterly Report on Form 10-Q for the three
months ended June 30, 1999 (SEC File No. 001-13225);
(f) The Company's Current Reports on Form 8-K dated May 14,
1999, June 3, 1999 and August 18, 1999 (SEC File No. 001-13225); and
(g) The Company's Registration Statement on Form S-4 filed
July 20, 1999 (SEC File No. 333-83221).
All documents filed by MotivePower pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934 after the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold, are deemed to be incorporated
by reference into this Registration Statement and to be a part hereof from the
respective dates of filing of such documents (such documents, and the documents
enumerated in paragraphs (a) through (g) above, being hereinafter referred to as
"Incorporated Documents").
Any statement contained in an Incorporated Document shall be deemed to
be modified or superseded for purposes of this registration Statement to the
extent that a statement contained herein or in any other subsequently filed
Incorporated Document modifies or supersedes such first statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities.
Not applicable.
13
<PAGE> 16
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
MotivePower's charter and by-laws provide for indemnification of
MotivePower's directors and officers for liabilities and expenses that they may
incur in such capacities. The MotivePower charter provides that, to the fullest
extent permitted by Pennsylvania law, no director will be personally liable to
the corporation for or with respect to any acts or omissions in the performance
of his or her duties. Pennsylvania law permits a corporation to eliminate the
personal liability of its directors for monetary damages for any action taken or
failure to take any action unless: (1) such directors have breached or failed to
perform their duties; and (2) the breach or failure to perform constitutes
self-dealing, willful misconduct or recklessness. MotivePower has adopted such a
provision in its charter. However, a Pennsylvania corporation is not empowered
to eliminate personal liability where the responsibility or liability of a
director is pursuant to any criminal statute or is for the payment of taxes
pursuant to any federal, state or local law. Reference is made to MotivePower's
charter incorporated by reference as set forth below as Exhibit 4.1 hereto, and
by-laws set forth below as Exhibit 4.2 hereto.
MotivePower also maintains directors and officers liability insurance
which provides for coverage against loss arising from claims made against
directors and officers in their capacity as such.
MotivePower has agreed to indemnify, to the extent provided under the
charter and by-laws of Westinghouse Air Brake Company ("WABCO") in effect on
June 2, 1999, the individuals who on or before the closing were officers or
directors of WABCO or its subsidiaries with respect to all acts or omissions
before the closing by these individuals in these capacities. MotivePower has
also agreed to provide, for six years after the closing, a directors' and
officers' liability insurance and indemnification policy that provides WABCO's
officers and directors in office immediately prior to the closing coverage
substantially equivalent to WABCO's policy in effect on June 2, 1999.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors or officers, the Company is aware
that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in that Act and is
therefore unenforceable. Under certain circumstances, the Company might be
required to submit to a court the question of whether indemnification is
permissible before it could indemnify directors or officers for such
liabilities.
Item 7. Exemption From Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit No. Description of Exhibit
----------- ----------------------
4.1 Articles of Incorporation (incorporated by reference
to Appendix B to MotivePower's Definitive Proxy
Statement filed on March 19, 1999).
4.2 By-laws of MotivePower (incorporated by reference to
Exhibit 2 to MotivePower's Registration Statement on
Form 8-A filed on May 4, 1999).
4.3 Rights Agreement, dated as of January 19, 1996
between MotivePower and Chase Mellon Shareholder
Services, L.L.C., as Rights Agent (incorporated by
reference to Exhibit 1 to MotivePower's Report on
Form 8-K filed on January 31, 1996).
14
<PAGE> 17
4.4 First Amendment to the Rights Agreement, dated April
5, 1996 (incorporated by reference to Exhibit 2 to
MotivePower's Amendment No. 1 on Form 8-A/A filed on
April 25, 1996).
4.5 Second Amendment to the Rights Agreement, dated June
20, 1996 (incorporated by reference to Exhibit 3 to
MotivePower's Amendment No. 2 on Form 8-A/A filed on
July 3, 1996).
4.6 Third Amendment to the Rights Agreement, dated July
25, 1996 (incorporated by reference to Exhibit 4 to
MotivePower's Registration Statement on Form 8-A
filed on August 1, 1997).
4.7 Fourth Amendment to the Rights Agreement, dated
August 22, 1997 (incorporated by reference to Exhibit
1 to MotivePower's Amendment No. 1 on Form 8-A/A
filed on October 23, 1997).
4.8 Fifth Amendment to the Rights Agreement, dated June
2, 1999 (incorporated by reference to Exhibit 1 to
MotivePower's Amendment No. 1 on Form 8-A/A filed on
June 3, 1999).
*4.9 MotivePower Industries, Inc. Stock Incentive Plan, as
amended.
*5.1 Opinion of Doepken Keevican & Weiss, as to the
legality of the securities being registered.
*23.1 Consent of Deloitte & Touche LLP.
*23.2 Consent of Arthur Andersen LLP.
*23.3 Consent of Doepken Keevican & Weiss (included in
Exhibit 5.1 to this Registration Statement).
*24.1 Powers of Attorney.
- -------------------
* Filed herewith. Exhibits incorporated by reference herein have previously been
filed by the Company with the Securities and Exchange Commission (SEC File No.
001-13225).
Item 9. Undertakings.
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in this Registration Statement;
and
15
<PAGE> 18
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
this Registration Statement or any material change to
such information in this Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or furnished to
the Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at the time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of a
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by a Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
16
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement on Form S-8 to be signed on its behalf of the
undersigned, thereunto duly authorized, in the City of Pittsburgh, State of
Pennsylvania, on this 19th day of August, 1999.
MOTIVEPOWER INDUSTRIES, INC.
By: /s/ Scott E. Wahlstrom
------------------------------
Scott E. Wahlstrom
Vice President, Human Resources
and Administration
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on August 19, 1999.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ John C. Pope* Non-Executive Chairman August 19, 1999
- -------------------------------- and Director
John C. Pope
/s/ Michael A. Wolf* President and Chief Executive August 19, 1999
- -------------------------------- Officer and Director (Principal
Michael A. Wolf Executive Officer)
/s/ William F. Fabrizio* Senior Vice President and Chief August 19, 1999
- -------------------------------- Financial Officer (Principal
William F. Fabrizio Financial Officer)
/s/ David L. Bonvenuto* Vice President, Controller and August 19, 1999
- -------------------------------- Principal Accounting Officer
David L. Bonvenuto
/s/ Gilbert E. Carmichael* Vice Chairman and Director August 19, 1999
- --------------------------------
Gilbert E. Carmichael
/s/ Ernesto Fernandez Hurtado* Director August 19, 1999
- --------------------------------
Ernesto Fernandez Hurtado
/s/ Lee B. Foster II* Director August 19, 1999
- --------------------------------
Lee B. Foster II
/s/ James P. Miscoll* Director August 19, 1999
- --------------------------------
James P. Miscoll
/s/ Nicholas J. Stanley* Director August 19, 1999
- --------------------------------
Nicholas J. Stanley
* By: /s/ William F. Fabrizio Attorney-in-Fact August 19, 1999
--------------------------
William F. Fabrizio
</TABLE>
17
<PAGE> 1
EXHIBIT 4.9
MOTIVEPOWER INDUSTRIES, INC.
STOCK INCENTIVE PLAN
SECTION 1 - PURPOSE OF PLAN
This Stock Incentive Plan is intended to promote the long-term interests of the
Company and its shareholders by providing officers, key employees of the Company
and its Affiliates and other key individuals (including non-employees) with an
additional incentive to promote the financial success of the Company and its
Affiliates.
SECTION 2 - DEFINITIONS
Unless otherwise required by the context, the following terms when used in the
Plan shall have the meanings set forth in this Section 2:
(a) "Affiliate": Any "parent corporation" or "subsidiary corporation" of
the Company, as such terms are defined in Sections 424(e) and (f),
respectively, of the Code.
(b) "Agreement": A restricted stock agreement, option agreement or rights
agreement evidencing an Award in such form as adopted by the Committee
pursuant to the Plan.
(c) "Award": An award of Restricted Stock, an Option or a Right, or a
combination thereof, under the Plan.
(d) "Board of Directors": The Board of Directors of the Company.
(e) "Code": The Internal Revenue Code of 1986, as amended from time to
time.
(f) "Committee": The Compensation Committee of the Board of Directors or
such other committee appointed by the Board of Directors which meets
the requirements set forth in Section 14(a) hereof.
(g) "Company": Motive Power Industries, a Delaware corporation.
(h) "Effective Date": The date on which the Plan shall become effective as
set forth in Section 15 hereof.
(i) "Exchange Act": The Securities Exchange Act of 1934, as amended,
together with all regulations and rules issued thereunder.
(j) "Exercise Price":
(i) In the case of an Option, the price per Share at which the
Shares subject to such Option may be purchased upon exercise
of such Option; and
(ii) in the case of a Right, the price per Share which, upon grant,
the Committee determines shall be utilized in calculating the
aggregate value which a Participant shall be entitled to
receive upon exercise of such Right.
(k) "Fair Market Value": As applied to a specific date, the mean between the
highest and lowest quoted selling price of a Share on the NASDAQ system
on such date, or if there are no reported sales on such date, on the
last preceding date on which sales were reported. The foregoing to the
contrary notwithstanding, with respect to initial Awards granted to
Participants in connection with an initial public offering of the
Company's common stock, Fair Market Value shall mean the initial public
offering price. The Fair Market Value determined by the Committee in
good faith in such manner shall be final, binding and conclusive on all
parties.
<PAGE> 2
(l) "ISO": An Option intended to qualify as an "incentive stock option," as
defined in Section 422 of the Code or any statutory provision that may
replace such Section.
(m) "LSAR": A limited stock appreciation right awarded to a Participant
under Section 9 hereof.
(n) "NQSO": An Option not intended to be an ISO and designated a
nonqualified stock option by the Committee.
(o) "Option": Any ISO or NQSO granted under the Plan.
(p) "Participant": An individual who has been granted an Award under the
Plan.
(q) "Plan": MotivePower Industries Stock Incentive Plan, as the same may be
amended from time to time.
(r) "Related":
(i) in the case of a Right, a Right which is granted in connection
with, and to the extent exercisable, in whole or in part, in
lieu of, an Option or another Right; and
(ii) in the case of an Option, an Option which is granted in
connection with, and to the extent exercisable, in whole or in
part, in lieu of, a Right or another Option.
(s) "Restricted Stock": Shares of restricted stock awarded to a Participant
under Section 10 hereof.
(t) "Right": Any SAR or LSAR granted under the Plan.
(u) "SAR": A stock appreciation right awarded to a Participant under
Section 8 hereof.
(v) "Shares": Shares of the Company's authorized but unissued or reacquired
$.0l par value common stock, or such other class or kind of shares or
other securities as may be applicable pursuant to the provisions of
Section 4(b) hereof.
(w) "Subsidiary": Any "subsidiary corporation" of the Company, as such term
is defined in Section 424(f) of the Code.
(x) "Trigger Event": An event described in Section 9(c) hereof.
SECTION 3 - PARTICIPATION
Except as modified below, the class of persons eligible to receive Awards under
the Plan shall be those officers and other key employees of the Company or its
Affiliates and those non-employees of the Company or its Affiliates, as
designated by the Committee from time to time, but in no case shall any member
of the Committee be eligible to receive any Award under the Plan. Although
designated non-employees are eligible to participate in the Plan, non-employees
are not eligible to receive an ISO or Related Right to an ISO under this Plan.
2
<PAGE> 3
SECTION 4 - SHARES SUBJECT TO PLAN
(a) Maximum Shares. Subject to adjustment by the operation of Section 4(b)
hereof, the maximum number of shares with respect to which Awards may
be made under the Plan is 3,000,000. The Shares with respect to which
Awards may be made under the Plan may be either authorized and unissued
shares or issued shares heretofore or hereafter reacquired and held as
treasury shares. Shares which are subject to Related Rights and Related
Options shall be counted only once in determining whether the maximum
number of Shares with respect to which Awards may be granted under the
Plan has been exceeded. An Award shall not be considered to have been
made under the Plan with respect to any Option or Right to the extent
that it terminates without being exercised, and new Awards may be
granted under the Plan with respect to the number of Shares as to which
such termination has occurred.
(b) Adjustment of Shares and Price. In the event that the Shares are
changed into or exchanged for a different kind or number of shares of
Stock or securities of the Company as the result of any stock dividend,
stock split, combination of shares, exchange of shares, merger,
consolidation, reorganization, recapitalization or other change in
capital structure, then the number of Shares subject to this Plan and
to Awards granted hereunder and the purchase price, repurchase price or
Exercise Price for such Shares shall be equitably adjusted by the
Committee to prevent the dilution or enlargement of Awards, and any new
stock or securities into which the Shares are changed or for which they
are exchanged shall be substituted for the Shares subject to this Plan
and to Awards granted hereunder; provided, however, that fractional
shares may be deleted from any such adjustment or substitution.
SECTION 5 - GENERAL TERMS AND CONDITIONS OF OPTIONS AND RIGHTS
(a) General Terms. The Committee shall have full and complete authority and
discretion, except as expressly limited by the Plan, to grant Options
and Rights and to provide the terms and conditions (which need not be
identical among Participants) thereof. In particular, the Committee
shall prescribe the following terms and conditions:
(i) the Exercise Price of any Option or Right, determined in
accordance with Section 5(b) hereof;
(ii) the number of Shares subject to, and the expiration date of,
any Option or Right, provided, however, that no Option or
Right shall have a term in excess of 10 years from the date of
grant of the Option or Right;
(iii) the manner, time and rate (cumulative or otherwise) of
exercise of such Option or Right; and
(iv) the restrictions, if any, to be placed upon such Option or
Right or upon Shares which may be issued upon exercise of such
Option or Right. The Committee may, as a condition of granting
any Option or Right, require that a Participant agree not to
thereafter exercise one or more Options or Rights previously
granted to such Participant.
(b) Exercise Price. The Exercise Price shall be determined by the Committee
and shall not be less than the Fair Market Value per Share on the date
of grant. Notwithstanding the foregoing, in no event shall the Exercise
Price be less than the par value per Share.
SECTION 6 - EXERCISE OF OPTIONS AND RIGHTS
(a) General Exercise Rights. An Option or Right granted under the Plan
shall be exercisable during the lifetime of the Participant to whom
such Option or Right was granted only by such Participant, and with
respect to an
3
<PAGE> 4
Option or Right granted to an employee of the Company or its Affiliates
except as provided in Section 6(c) hereof, no such Option or Right may
be exercised unless at the time such Participant exercises such Option
or Right, such participant is an employee of, and has continuously
since the grant thereof been an employee of, the Company or an
Affiliate. Transfer of employment between Affiliates or between an
Affiliate and the Company shall not be considered an interruption or
termination of employment for any purpose of this Plan. Neither shall a
leave of absence at the request, or with the approval, of the Company
or an Affiliate be deemed an interruption or termination of employment,
so long as the period of such leave does not exceed 90 days, or, if
longer, so long as the Participant's right to re-employment with the
Company or an Affiliate is guaranteed by contract. An Option or Right
also shall contain such conditions upon exercise (including, without
limitation, conditions limiting the time of exercise to specified
periods) as may be required to satisfy applicable regulatory
requirements, including, without limitation, Rule 16b-3 (or any
successor rule) promulgated by the Securities and Exchange Commission.
(b) Notice of Exercise. An Option or Right may not be exercised with
respect to less than 25 Shares, unless the exercise relates to all
Shares covered by the Option or Right at the date of exercise. An
Option or Right shall be exercised by delivery of a written notice to
the Company. Such notice shall state the election to exercise the
Option or Right and the number of whole Shares in respect of which it
is being exercised, and shall be signed by the person or persons so
exercising the Option or Right. In the case of an exercise of an
Option, such notice shall either: (a) be accompanied by payment of the
full Exercise Price and all applicable withholding taxes, in which
event the Company shall deliver any certificate(s) representing Shares
which the Participant is entitled as a result of the exercise as soon
as practicable after the notice has been received: or (b) fix a date
(not less than 5 nor more than 15 business days from the date such
notice has been received by the Company) for the payment of the full
Exercise Price and all applicable withholding taxes, against delivery
by the Company of any certificate(s) representing Shares which the
Participant is entitled to receive as a result of the exercise. Payment
of such Exercise Price and withholding taxes shall be made as provided
in Sections 6(d) and 13, respectively. In the event the Option or Right
shall be exercised pursuant to Section 6(c)(i) hereof, by any person or
persons other than the Participant, such notice shall be accompanied by
appropriate proof of the right of such person or persons to exercise
the Option or Right.
(c) Exercise After Termination of Employment. With respect to an Option or
Related Right granted to an employee of the Company or its Affiliates,
except as otherwise determined by the Committee at the date of grant of
the Option or Award and as is provided in the applicable Agreement
evidencing the Option or Right, upon termination of a Participant's
employment with the Company or any of its Affiliates, such Participant
(or in the case of death, the person(s) to whom the Option or Right is
transferred by will or the laws of descent and distribution) may
exercise such Option or Right during the following periods of time (but
in no event after the normal expiration date of such Option or Right):
(i) in the case of termination as a result of death, disability or
retirement of the Participant, the Option or Right shall
remain exercisable (as to the number of shares exercisable on
the termination date) for one year after the date of
termination; for this purpose, "disability" shall mean such
physical or mental condition affecting the Participant as
determined by the Committee in its sole discretion, and
"retirement" shall mean voluntary retirement under a
retirement plan or program of the Company or any Affiliate;
(ii) in the case of termination for cause, the Option or Right
shall immediately terminate and shall no longer be
exercisable; and
(iii) in the case of termination for any reason other than those set
forth in subparagraphs (i) and (ii) above, with respect to the
shares exercisable on the date of termination, the Option or
Right shall remain exercisable for three months after the date
of termination.
4
<PAGE> 5
To the extent the Option or Right is not exercised within the foregoing periods
of time, the Option or Right shall automatically terminate at the end of the
applicable period of time. Notwithstanding the foregoing provisions, failure to
exercise an ISO within the periods of time prescribed under Sections 421 and 422
of the Code shall cause an ISO to cease to be treated as an "incentive stock
option" for purposes of Section 421 of the Code.
(d) Payment of Option Exercise Price. Upon the exercise of an Option,
payment of the Exercise Price shall be made either (i) in cash (by a
certified check, personal check, bank draft or money order), (ii) with
the consent of the Committee and subject to Section 6(e) hereof, by
delivering the Participant's duly-executed promissory note and related
documents, (iii) with the consent of the Committee, by delivering
Shares owned by the Participant for more than six (6) months valued at
Fair Market Value, or (iv) by a combination of the foregoing forms of
payment.
(e) Payment with Loan. The Committee may in its sole discretion assist any
Participant in the exercise of one or more Options granted to such
Participant under the Plan by authorizing the extension of a loan to
such Participant from the Company. Except as otherwise provided in this
Section 6(e), the terms of any loan (including the interest rate and
terms of repayment) shall be established by the Committee in its sole
discretion. The maximum amount of any loan shall not exceed 80% of the
Exercise Price payable for the Shares being purchased. Any such loan by
the Company shall be with full recourse against the Participant to whom
the loan is granted, shall be secured in whole or in part by the Shares
so purchased, and shall bear interest at a rate not less than the
minimum interest rate required at the time of purchase of the Shares in
order to avoid having imputed interest or original issue discount under
Sections 483 or 1272 of the Code. In addition, any such loan by the
Company to an employee shall become immediately due and payable in
full, at the option of the Company, upon termination of the
Participant's employment with the Company or its Affiliates for any
reason or upon a sale of any Shares acquired with such loan to the
extent of the cash and fair market value of any property received by
the Participant in such sale. The Committee may make arrangements for
the application of payroll deductions from compensation payable to the
Participant to amounts owing to the Company under any such loan. Until
any loan by the Company under this Section 6(e) is fully paid in cash,
the Shares shall be pledged to the Company as security for such loan
and the Company shall retain physical possession of the stock
certificates evidencing the Shares so purchased together with a duly
executed stock power for such Shares. No loan shall be made hereunder
unless counsel for the Company shall be satisfied that the loan and the
issuance of Shares funded thereby will be in compliance with all
applicable federal, state and local laws.
(f) Rights as a Shareholder. A Participant shall have no rights as a
shareholder with respect to any Shares issuable on exercise of any
Option or Right until the date of the issuance of a stock certificate
to the Participant for such Shares. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record
date is prior to the date such stock certificate is issued, except as
provided in Section 4(b) hereof.
(g) Effect of Dissolution, Merger, Etc. Upon the dissolution or liquidation
of the Company, or upon a reorganization, merger, or consolidation of
the Company with one or more corporations as a result of which the
Company is not the surviving corporation, or upon a sale of
substantially all the property of the Company to another corporation,
this Plan shall terminate, and any outstanding Options and Rights shall
terminate, unless provision be made in connection with such transaction
for the assumption of such Options and Awards, or the substitution for
such Options and Awards of new incentive awards covering the stock of a
successor employer corporation, or a parent or subsidiary thereof, with
appropriate adjustments as to number and kind of shares and prices.
SECTION 7 - SPECIAL PROVISIONS FOR ISO'S
Any provision of the Plan to the contrary notwithstanding, the following special
provisions shall apply to all ISOs granted under the Plan:
5
<PAGE> 6
(a) the Option must be expressly designated as an ISO by the Committee and
in the ISO Agreement;
(b) no ISO shall be granted more than ten years from the Effective Date of
the Plan and no ISO shall be exercisable more than ten years from the
date such ISO is granted;
(c) the Exercise Price of any ISO shall not be less than the Fair Market
Value per Share on the date such ISO is granted;
(d) no ISO shall be granted to any individual who, at the time such ISO is
granted, owns stock possessing more than 10% of the total combined
voting power of all classes of stock of the Company or any Affiliate
unless the Exercise Price of such ISO is at least 110% of the Fair
Market Value per Share at the date of grant and such ISO is not
exercisable after the expiration of five years from the date such ISO
is granted;
(e) the aggregate Fair Market Value (determined as of the time any ISO is
granted) of any Company stock with respect to which any ISOs granted to
a Participant are exercisable for the first time by such Participant
during any calendar year (under this Plan and all other stock option
plans of the Company and any of its Affiliates and any predecessor of
any such corporations) shall not exceed $100,000 as required under
Section 422(d)(7) of the Code. (To the extent the $100,000 limit is
exceeded, the $100,000 in options, measured as described above, granted
earliest in time will be treated as ISOs);
(f) no ISO shall be granted to an individual who is not an employee of the
Company or its Affiliates at the time such ISO is granted; and
(g) any other terms and conditions as may be required in order that the ISO
qualifies as an "incentive stock option" under Section 422 of the Code
or successor provision.
SECTION 8 - STOCK APPRECIATION RIGHTS
(a) Grant of SAR. An SAR shall, upon its exercise, entitle the Participant
to whom such SAR was granted to receive a number of Shares or cash or
combination thereof, as the Committee in its discretion shall
determine, the aggregate value of which (i.e., the sum of the amount of
cash and/or Fair Market Value of such Shares on date of exercise) shall
equal the amount by which the Fair Market Value per Share on the date
of such exercise shall exceed the Exercise Price of such SAR,
multiplied by the number of Shares with respect of which such SAR shall
have been exercised. An SAR may be Related to an Option or may be
granted independently of any Option, as the Committee shall from time
to time in each case determine. A Related SAR may be granted at the
time of grant of an Option or, in the case of an NQSO, at any time
thereafter during the term of the NQSO.
(b) Related SAR. The Exercise Price of a Related SAR shall be the same as
the Exercise Price of the Related Option. A Related SAR shall be
exercisable only at such time or times and only to the extent that the
Related Option is exercisable and then only when the Fair Market Value
per Share on the date of exercise exceeds the Exercise Price. A Related
SAR shall expire no later than the Related Option. Upon exercise of a
Related SAR, in whole or in part, the Related Option shall be canceled
automatically to the extent of the number of Shares covered by such
exercise, and such Shares shall no longer be available for grant of
future Awards. Conversely, if the Related Option is exercised, in whole
or in part, the Related SAR shall be canceled automatically to the
extent of the number of Shares covered by the Option exercise.
6
<PAGE> 7
SECTION 9 - LIMITED STOCK APPRECIATION RIGHTS; ACCELERATION OF
AWARDS
(a) Grant of LSAR. At the time of grant of an Option or SAR to any
Participant (or, in the case of an NQSO or an SAR not Related to an
ISO, at any time thereafter during the term of the NQSO or SAR), the
Committee shall have full and complete authority and discretion to also
grant to such Participant an LSAR which is Related to such Option or
SAR.
(b) Exercise of LSAR. An LSAR shall entitle the holder thereof, upon
exercise of the LSAR within the exercise period prescribed below and
satisfaction of any conditions imposed by the Committee in the grant of
the LSAR, to surrender the Related Option and/or SAR or any portion
thereof, and to receive without payment to the Company an amount of
cash determined pursuant to Section 9(d) hereof. An LSAR shall be
exercisable only during one or more of the periods prescribed below in
Section 9(c), provided, however, that no LSAR may be exercised within
six months of the date the LSAR was granted and an LSAR shall be
exercisable only at such time or times and to the extent that the
Related SAR or Option is exercisable and only when the Fair Market
Value per Share exceeds the Exercise Price per Share. To the extent
that an LSAR is exercised, the Related Option and/or SAR shall
automatically be canceled to the extent of the number of Shares covered
by such exercise, and such Shares shall no longer be available for
future Awards. To the extent that a Related Option or SAR is exercised,
the Related LSAR shall automatically be canceled to the extent of the
number of Shares covered by such exercise.
(c) Trigger Event. An LSAR shall be exercisable, subject to the provisos in
Section 9(b), during any one or more of the following periods:
(i) for a period of 60 days beginning on the date on which Shares
are first purchased pursuant to a tender offer or exchange
offer (other than such an offer by MotivePower Industries, the
Company, any Subsidiary, any employee benefit plan of the
Company or of any Subsidiary or any entity holding Shares or
other securities of the Company for or pursuant to the terms
of such plan), whether or not such offer is approved or
opposed by the Company and regardless of the number of Shares
purchased pursuant to such offer;
(ii) for a period of 60 days beginning on the date the Company
acquires knowledge that any person or group deemed a person
under Section 13(d)(3) of the Exchange Act (other than
MotivePower Industries, the Company, any Subsidiary, any
employee benefit plan of the Company or of any Subsidiary or
any entity holding Shares or other securities of the Company
for or pursuant to the terms of any such plan), in a
transaction or series of transactions, has become the
beneficial owner, directly or indirectly (with beneficial
ownership determined as provided in Rule 13d-3, or any
successor rule, under the Exchange Act), of securities of the
Company entitling the person or group to 30% or more of all
votes (without consideration of the rights of any class of
stock to elect directors by a separate class vote) to which
all shareholders of the Company would be entitled in the
election of the Board of Directors were an election held on
such date;
(iii) for a period of 60 days beginning on the date, during, any
period of two consecutive years, when individuals who at the
beginning of such period constitute the Board of Directors of
the Company cease for any reason to constitute at least a
majority thereof, unless the election, or the nomination for
election by the shareholders of the Company, of each new
Director was approved by a vote of at least two-thirds of the
Directors then still in office who were Directors at the
beginning of such period; and
7
<PAGE> 8
(iv) for a period of 60 days beginning on the date of approval by
the shareholders of the Company of an agreement (a
"reorganization agreement) providing for:
(A) the merger or consolidation of the Company with another
corporation where the shareholders of the Company,
immediately prior to the merger or consolidation, do
not beneficially own, immediately after the merger or
consolidation, shares of the corporation issuing cash
or securities in the merger or consolidation entitling
such shareholders to 80% or more of all votes (without
consideration of the rights of any class of stock to
elect directors by a separate class vote) to which all
shareholders of such corporation would be entitled in
the election of Directors or where the members of the
Board of Directors of the Company, immediately prior to
the merger or consolidation, do not, immediately after
the merger or consolidation, constitute a majority of
the Board of Directors of the corporation issuing cash
or securities in the merger or consolidation; or
(B) the sale or other disposition of all or substantially
all the assets of the Company.
Each of the events specified in (i), (ii), (iii) and (iv) above from
which the sixty-day period specified above commences is a "Trigger Event"
for the purposes of the Plan.
(d) Payment Upon Exercise. Upon exercise of an LSAR, the Participant shall be
entitled to receive an amount of cash in respect of each Share subject to
the Related Option or SAR equal to the excess of the fair market value of
such Share over the Exercise Price of such Related Option or SAR. In the
case of LSARs related to ISOs, "fair market value" shall mean the Fair
Market Value of Shares on the date the LSAR is exercised. In the case of
all other LSARS, "fair market value" shall mean the highest last sale
price of the Shares as reported on the NASDAQ system during the period
beginning on the 90th day prior to the date on which the LSAR is
exercised and ending on such date, except that:
(i) in the event of a tender offer or exchange offer for Shares,
fair market value shall mean the greater of such last sale price
or the highest price paid for Shares pursuant to any tender
offer or exchange offer in effect at any time beginning on the
90th day prior to the date on which the LSAR is exercised and
ending on such date,
(ii) in the event of the acquisition by any person or group of
beneficial ownership of securities of the Company entitling the
person or group to 30% or more of the combined voting power of
the Company's outstanding securities, fair market value shall
mean the greater of such last sales price or the highest price
per Share paid shown on the Schedule 13D, or any Amendment
thereto, filed by the person or group becoming a 30% beneficial
owner or disclosing an intention or possible intention to
acquire control of the Company, and
(iii) in the event of approval by shareholders of the Company of a
reorganization agreement, fair market value shall mean the
greater of such last sale price or the fixed or formula price
specified in the reorganization agreement if such price is
determinable as of the date of exercise of the LSAR.
Any securities or property which are part or all of the consideration
paid for Shares in a tender offer or exchange offer or under an approved
reorganization agreement shall be valued at the higher of (1) the
valuation placed on such securities or property by the person making the
tender offer or exchange offer or by the corporation other than the
Company issuing securities or property in the merger or consolidation or
to whom the Company is selling or otherwise disposing of all or
substantially all the assets of the Company and (2) the valuation placed
on such securities or property by the Committee.
(e) Acceleration of Options and SARs. All Options and SARs shall become fully
exercisable upon the occurrence of any Trigger Event, whether or not such
Options or SARs are then exercisable under the provisions of the
8
<PAGE> 9
applicable Agreements relating thereto, except that (1) in no event will
SARs or Options Related to SARs be exercisable within six months after
the date on which granted, and (2) SARs Related to LSARs may not be
exercised for cash during any of the 60-day periods after a Trigger
Event.
SECTION 10 - TERMS AND CONDITIONS OF AWARDS OF RESTRICTED STOCK
(a) General Terms. The Committee shall have full and complete authority and
discretion, except as expressly limited by the Plan, to grant Awards of
Restricted Stock and to provide the terms and conditions (which need not
be identical among Participants) thereof. Awards of Restricted Stock
shall be evidenced by written Agreements in such form as the Committee
from time to time shall approve. In particular, the Committee shall
prescribe the following terms and conditions:
(i) the number of Shares of Restricted Stock to be awarded to each
Participant;
(ii) the restriction period applicable to each Award of Restricted
Stock, which period shall be determined at the time of the Award
and need not be the same for all Awards; and
(iii) the payment, if any, to be made by the Participant in
consideration of the Award. Any Award may be made without
payment of consideration by the Participant or may provide for
payment of cash or deferred consideration which is less than the
Fair Market Value of the awarded shares at the date of grant.
Any such Award may be on the basis that the shares awarded
thereby may be repurchased by the Company at a fixed price or at
a price established by formula, either upon forfeiture of the
awarded shares or in other specified circumstances.
(b) Restrictions. The Shares of Restricted Stock awarded shall be subject to
restrictions as set forth in Section 11.
(c) Certificates. A stock certificate or certificates evidencing the Shares
of Restricted Stock awarded shall be issued in the name of the recipient
and delivered to the Committee or its designee to be held in safekeeping
until the periodic expiration of the restrictions. The certificates
issued pursuant to the Plan shall contain a legend necessary to reflect
the restrictions on such Shares as contained in Section 11.
(d) Rights as a Shareholder. Subject to the restrictions contained in Section
11 hereof, the recipient of an Award of Restricted Stock pursuant to the
Plan shall have all the rights as a shareholder with respect to the
Shares covered by the Award including, but not limited to, the right to
vote such Shares, the right to receive cash or stock dividends with
respect thereto and the right to participate in any subdivision or
consolidation of Shares or other capital adjustment, or the payment of a
stock dividend or other increase or decrease in such Shares, effected
without receipt of consideration by the Company. In the event the
recipient receives additional Shares pursuant to any of the foregoing
events, the Shares acquired shall be subject to the terms, conditions and
restrictions contained herein as if such additional Shares were received
at the date of the original Award.
SECTION 11 - RESTRICTIONS ON RESTRICTED STOCK AND LAPSE THEREOF
(a) Restrictions. Shares of Restricted Stock awarded shall be subject to the
restrictions that, during the restriction period or prior to the lapse of
the restrictions in accordance with subsection (c) hereof, such Shares:
(i) shall not be sold, exchanged, transferred, pledged or otherwise
disposed of; and
(ii) shall be forfeited to the Company if the recipient's employment
is terminated (if the Restricted Stock is awarded to an employee
of the Company or its Affiliates) or upon such other
circumstance as determined by the Committee at the time such
Award is granted;
9
<PAGE> 10
except as provided in subsection (c) hereof.
(b) Restriction Period. Restrictions shall lapse at the times determined by
the Committee unless such restrictions are terminated earlier in
accordance with subsection (c) below.
(c) Lapse of Restrictions. The restrictions contained herein shall lapse upon
the occurrence of any of the following events:
(i) Upon the retirement of a recipient at the normal retirement date
as defined under the MotivePower IndustriesSavings Plan, the
restrictions applicable to stock awards to said recipient shall
lapse according to the following formula.
For each award of restricted stock:
Number of shares for which
restrictions shall lapse = X x N
Y
Where:
X = number of months from the date of award to the
date of the Participant's termination;
Y = number of months required under the award for
all restrictions to lapse without regard to
early lapse under Section 11(c) of the Plan;
and
N = the number of shares under each award for which
restrictions have not lapsed.
(ii) The death or total and permanent disability of a recipient while
employed by the Company or an Affiliate;
(iii) The occurrence of a Trigger Event;
(iv) At such times, other than as described in (i), (ii) or (iii),
above, including termination by the Company or an Affiliate of a
recipient's employment for any reason or the early retirement of
a recipient with the consent of the Company, if the Committee
determines in the exercise of its sole discretion that the lapse
of restrictions at such time with respect to all or a portion of
the shares awarded is in the best interest of the Company.
SECTION 12 - RESTRICTIONS ON TRANSFERS; GOVERNMENT REGULATIONS
(a) Awards Not Transferable. No Option or Right nor any right or interest of
a Participant under the Plan in any instrument evidencing any Option or
Right under the Plan may be assigned, encumbered, or transferred, except,
in the event of the death of a Participant, by will or the laws of
descent and distribution.
(b) Government Regulations. This Plan, the granting of Awards under this Plan
and the issuance or transfer of Shares (and/or the payment of money)
pursuant thereto are subject to all applicable Federal and state laws,
rules and regulations and to such approvals by any regulatory or
governmental agency (including without limitation "no action" positions
of the Securities and Exchange Commission) which may, in the opinion of
counsel for the Company, be necessary or advisable in connection
therewith. Without limiting the generality of the foregoing, no Awards
may be granted under this Plan, and no Shares shall be issued by the
Company, nor cash payments made by the Company, pursuant to or in
connection with any such Award, unless and until,
10
<PAGE> 11
in each such case, all legal requirements applicable to the issuance or
payment have, in the opinion of counsel to the Company, been complied
with. In connection with any stock issuance or transfer, the person
acquiring the shares shall, if requested by the Company, give assurances
satisfactory to counsel to the Company in respect of such matters as the
Company may deem desirable to assure compliance with all applicable legal
requirements. The Company shall not be required to deliver any Shares
under the Plan prior to (i) the admission of such Shares to listing or
for quotation on any stock exchange or automated quotation system on
which Shares may then be listed or quoted, and (ii) the completion and
effectiveness of such registration or other qualification of such Shares
under any state or federal law, rule or regulation, as the Committee
shall determine to be necessary or advisable.
SECTION 13 - TAX WITHHOLDING
The Company shall have the right to withhold from amounts due Participants, or
to collect from Participants directly, the amount which the Company deems
necessary to satisfy any taxes required by law to be withheld at any time by
reason of participation in the Plan, and the obligations of the Company under
the Plan shall be conditional on payment of such taxes. The Participant may,
prior to the due date of any taxes, pay such amounts to the Company in cash, or
with the consent of the Committee, in Shares (which shall be valued at their
Fair Market Value on the date of payment). There is no obligation under this
Plan that any Participant be advised of the existence of the tax or the amount
required to be withheld. Without limiting, the generality of the foregoing, in
any case where it determines that a tax is or will be required to be withheld in
connection with the issuance or transfer or vesting of Shares under this Plan,
the Company may, pursuant to such rules as the Committee may establish, reduce
the number of such Shares so issued or transferred by such number of Shares as
the Company may deem appropriate in its sole discretion to accomplish such
withholding or make such other arrangements as it deems satisfactory.
Notwithstanding, any other provision of this Plan, the Committee may impose such
conditions on the payment of any withholding obligation as may be required to
satisfy applicable regulatory requirements, including, without limitation, Rule
16b-3 (or successor provision) promulgated by the Securities and Exchange
Commission.
SECTION 14 - ADMINISTRATION OF PLAN
(a) The Committee. The Plan shall be administered by the Committee, which
shall be comprised of two or more members of the Board of Directors, each
of whom shall be a "disinterested person" as defined in Rule 16b-3 (or
successor provision) promulgated by the Securities and Exchange
Commission.
(b) Committee Action. A majority of the members of the Committee at the time
in office shall constitute a quorum for the transaction of business, and
any determination or action may be taken at a meeting by a majority vote
or may be taken without a meeting by a written resolution signed by all
members of the Committee. All decisions and determinations of the
Committee shall be final, conclusive and binding upon all Participants
and upon all other persons claiming any rights under the Plan with
respect to any Options or Rights. Members of the Board of Directors and
members of the Committee acting under the Plan shall be fully protected
in relying in good faith upon the advice of counsel and shall incur no
liability except for willful misconduct in the performance of their
duties.
(c) Committee Authority. In amplification of the Committee's powers and
duties, but not by way of limitation, the Committee shall have full
authority and power to:
(i) Construe and interpret the provisions of the Plan and make rules
and regulations for the administration of the Plan not
inconsistent with the Plan;
(ii) Decide all questions of eligibility for Plan participation and
for the grant of Awards;
11
<PAGE> 12
(iii) Adopt forms of Agreements and other documents consistent with
the Plan;
(iv) Engage agents to perform legal, accounting and other such
professional services as it may deem proper for administering
the Plan; and
(v) Take such other actions as may be reasonably required or
appropriate to administer the Plan or to carry out the Committee
activities contemplated by other sections of this Plan.
(d) Indemnification. In addition to such other rights of indemnification as
they may have as directors or as members of the Committee, the Board of
Directors and the members of the Committee shall be indemnified by the
Company against the reasonable expenses, including court costs and
reasonable attorneys' fees, actually incurred in connection with the
defense of any action, suit or proceeding, or in connection with any
appeal therein, to which they or any of them may be a party by reason of
any action taken or failure to act under or in connection with the Plan
or any Award granted hereunder, and against all amounts paid by them in
settlement thereof or paid by them in satisfaction of a judgment in any
such action, suit or proceeding, except where such indemnification is
expressly prohibited by applicable law.
SECTION 15 - EFFECTIVE DATE
The effective date of this Plan shall be April 1, 1994 (the date such Plan will
be approved by the Board of Directors), subject to receipt of shareholder
approval of this Plan within one year of that date. All Awards pursuant to this
Plan prior to receipt of shareholder approval shall be effective when made but
shall be subject to the terms of this Plan only upon receipt of such shareholder
approval. If such approval is not received within the one-year period specified
above, all Awards made on or after April 1, 1994 shall be forfeited.
SECTION 16 - AMENDMENT AND TERMINATION
(a) The Plan.
(i) Amendment. The Board of Directors may amend the Plan from time
to time in its sole discretion; provided, however, that no such
amendment shall, without the approval of the shareholders of the
Company if such approval is required by the laws of the State of
Delaware or Section 422 of the Code or Rule 16b-3 under the
Exchange Act: (a) change the class of persons eligible to
receive Awards or otherwise materially modify the requirements
as to eligibility for participation in the Plan; (b) increase
the aggregate number of Shares with respect to which Awards may
be made under the Plan; (c) materially increase the benefits
accruing, to Participants under the Plan; or (d) remove the
administration of the Plan from the Committee or render any
member of the Committee eligible to receive an Award under the
Plan while serving thereon. Any purported amendment in violation
of these restrictions shall be void and of no effect.
Furthermore, no amendment shall impair the rights of any
Participant under any Award theretofore made under the Plan,
without the Participant's consent.
(ii) Termination. The Board of Directors may suspend or terminate the
Plan at any time. Upon termination of the Plan, no additional
Awards shall be granted under the Plan; provided, however, that
the terms of the Plan shall continue in full force and effect
with respect to outstanding and unexercised Options and Rights
granted under the Plan and Shares issued under the Plan.
(b) Awards. Subject to the terms and conditions and the limitations of the
Plan, the Committee may in the exercise of its sole discretion modify,
extend or renew the terms of outstanding Awards granted under the Plan,
or accept the surrender of outstanding Awards (to the extent not
theretofore exercised) and authorize the granting of new Awards in
substitution therefor (to the extent not theretofore exercised). Without
limiting the generality of the
12
<PAGE> 13
foregoing, the Committee may in its discretion at any time accelerate the
time at which any Option or Right is exercisable, subject to compliance
with the requirements of Rule 16b-3 (or successor provision) promulgated
by the Securities and Exchange Commission. Notwithstanding the foregoing,
however, no modification of an Award shall, without the consent of the
Participant, impair any rights or obligations under any Awards
theretofore granted under the Plan.
SECTION 17 - MISCELLANEOUS
(a) Employment. Neither the establishment of the Plan nor any amendments
thereto, nor the granting of any Award under the Plan, shall be construed
as in any way modifying or affecting, or evidencing any intention or
understanding with respect to, the terms of the employment of any
Participant with the Company or any of its Affiliates. No person shall
have a right to be granted Awards or, having been selected as a
Participant for one Award, to be so selected again.
(b) Multiple Awards. Subject to the terms and restrictions set forth in the
Plan, a Participant may hold more than one Award.
(c) Written Notice. As used herein, any notices required hereunder shall be
in writing and shall be given on the forms, if any, provided or specified
by the Committee. Written notice shall be effective upon actual receipt
by the person to whom such notice is to be given; provided, however, that
in the case of notices to Participants and their heirs, legatees and
legal representatives, notice shall be effective upon delivery if
delivered personally or three business days after mailing, registered
first class postage prepaid to the last known address of the person to
whom notice is given. Written notice shall be given to the Committee and
the Company at the following address or such other address as may be
specified from time to time:
MotivePower Industries
Two Gateway Center, 14th Floor
Pittsburgh, PA 15222
Attn: Scott Wahlstrom
(d) Applicable Law; Severability. The Plan shall be governed by and construed
in all respects in accordance with the laws of the State of Delaware. If
any provisions of the Plan shall be held by a court of competent
jurisdiction to be invalid or unenforceable, the remaining provisions
hereof shall continue to be fully effective.
SECTION 18 - ADMINISTRATION OF THE PLAN PRIOR TO INITIAL PUBLIC
OFFERING
(a) In General. The Company anticipates that a portion of its common stock
will be sold in an initial public offering ("Public Offering"). Until the
consummation of the Public Offering, the provisions of this Section 18
shall govern the administration and operation of the Plan. To the extent
any other provision of this Plan conflicts with the terms of this Section
18, this Section 18 shall control. However, upon the consummation of the
Public Offering, the terms of this Section 18 shall cease to be effective
and the administration and operation of the Plan shall thereafter be
determined without reference to this Section 18.
(b) Administration of Plan by Board. Prior to the earlier of (i) the
consummation of the Public Offering or (ii) the appointment of a
compensation committee meeting the requirements of Section 14 of the
Plan, the Board shall have full and complete authority and discretion to
grant Awards and to provide the terms and conditions of such Awards
(which need not be identical among individual participants). The Board
may grant such Awards to members of the Board provided that any member of
the Board who receives an Award must also be an officer or key employee
of the Company or its Affiliates.
13
<PAGE> 1
EXHIBIT 5.1
DOEPKEN KEEVICAN & WEISS
PROFESSIONAL CORPORATION
600 Grant Street
58th Floor
Pittsburgh, Pennsylvania 15219
Phone: 412-355-2600
Fax: 412-355-2609
August 18, 1999
MotivePower Industries, Inc.
Two Gateway Center, 14th Floor
Pittsburgh, PA 15222
Re: Registration Statement on Form S-8
----------------------------------
Gentlemen and Ladies:
We have acted as special counsel to MotivePower Industries, Inc. (the
"Company") in connection with the preparation of a Registration Statement on
Form S-8 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Act"), relating to up to 3,000,000 shares of common stock of the
Company (the "Common Stock") issued to employees of the Company subject to
certain restrictions when issued, or issuable to employees upon the exercise of
stock options, in each case under the MotivePower Industries, Inc. Stock
Incentive Plan (formerly the MK Rail Corporation Stock Incentive Plan) (the
"Plan").
In connection with this opinion, we have examined, among other things:
(1) the Restated Certificate of Incorporation of the Company, as
amended to date;
(2) resolutions adopted by the shareholders and board of directors
of the Company adopting the Plan and approving certain
amendments to the Plan; and
(3) the Plan, as currently in effect.
Based upon the foregoing and upon an examination of such other documents,
corporate proceedings, statutes, decisions and questions of law as we considered
necessary in order to enable us to furnish this opinion, and subject to the
assumptions set forth above, we are pleased to advise you that in our opinion:
(a) The Company has been duly incorporated and is a validly existing
corporation under the laws of the Commonwealth of Pennsylvania;
and
(b) The shares of Common Stock being registered and issued or
issuable by the Company pursuant to the provisions of the Plan
have been duly authorized, and are, or upon such issuance in
accordance with the provisions of the Plan, will be, validly
issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement.
Yours truly,
/s/ Doepken Keevican & Weiss
Professional Corporation
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
MotivePower Industries, Inc. on Form S-8 of our reports dated February 11, 1999
(March 2, 1999 as to Note 18), appearing in the Annual Report on Form 10-K of
MotivePower Industries, Inc. for the year ended December 31, 1998 and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
/s/ Deloitte & Touche LLP
Pittsburgh, Pennsylvania
August 18, 1999
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our reports dated
February 17, 1999 included in Westinghouse Air Brake Company's Form 10-K for the
year ended December 31, 1998 and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen LLP
Pittsburgh, Pennsylvania
August 19, 1999
<PAGE> 1
EXHIBIT 24.1
POWER OF ATTORNEY
KNOW BY ALL MEN BY THESE PRESENTS, that each of the undersigned, a
director or officer or both, of MotivePower Industries, Inc., a Pennsylvania
corporation (the "Company"), does hereby appoint Jeannette Fisher-Garber and
William F. Fabrizio, and each of them, with full power to act without the other,
such person's true and lawful attorneys-in-fact, with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign Form S-8 Registration Statements, and any and all amendments
thereto (including post-effective amendments), relating to the registration of
shares to be issued in connection with (i) the MotivePower Industries, Inc.
Stock Incentive Plan, (ii) the MotivePower Industries, Inc. Stock Option Plan
for Non-Employee Directors, (iii) the MotivePower, Inc. (401(k)) Savings Plan,
and (iv) the MotivePower Industries, Inc. Deferred Compensation Plan and the
MotivePower Industries, Inc. Deferred Compensation Plan for Michael A. Wolf, and
to file the same, with exhibits and schedules thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact, and each of them, with full power and authority to do
and perform each and every act and thing necessary or desirable to be done in or
about the premises, as fully to all intents and purposes as he or she might or
could do in person, thereby ratifying and confirming all that said
attorneys-in-fact, or any of them, or their or his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents this
14th day of July, 1999.
/s/ JOHN C. POPE
-------------------------------
John C. Pope
/s/ MICHAEL A. WOLF
-------------------------------
Michael A. Wolf
/s/ WILLIAM F. FABRIZIO
-------------------------------
William F. Fabrizio
/s/ DAVID L. BONVENUTO
-------------------------------
David L. Bonvenuto
/s/ GILBERT E. CARMICHAEL
-------------------------------
Gilbert E. Carmichael
/s/ ERNESTO FERNANDEZ HURTADO
-------------------------------
Ernesto Fernandez Hurtado
/s/ LEE B. FOSTER II
-------------------------------
Lee B. Foster II
/s/ JAMES P. MISCOLL
-------------------------------
James P. Miscoll
/s/ NICHOLAS J. STANLEY
-------------------------------
Nicholas J. Stanley
