SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended March 31, 1995
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition period from to
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Commission file number 1-1373
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MODINE MANUFACTURING COMPANY
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(Exact name of registrant as specified in its charter)
WISCONSIN 39-0482000
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1500 DeKoven Avenue, Racine, Wisconsin 53403
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (414) 636-1200
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Securities Registered pursuant to Section 12(g) of the Act:
Common Stock, $0.625 par value
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(Title of Class)
An Exhibit index appears at pages 20-25 herein.
Page 1 of 117
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months,
and (2) has been subject to such filing requirements for the past
90 days. Yes X No ____
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Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Approximately 51% of the outstanding shares are held by non-
affiliates. The aggregate market value of these shares was
approximately $571,194,144 based on the market price of $37.75
per share on June 20, 1995. The remaining outstanding shares are
owned or controlled by or for directors, officers, employees,
retired employees, and their families.
The number of shares outstanding of the registrant's Common
Stock, $0.625 par value, was 29,668,570 at June 20, 1995.
DOCUMENTS INCORPORATED BY REFERENCE
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Portions of the following documents are incorporated by reference
into the parts of this Form 10-K designated to the right of the
document listed.
Incorporated Document Location in Form 10-K
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Annual Report to Shareholders for the
fiscal year ended March 31, 1995 Part I of Form 10-K
(Item 1)
Part II of Form 10-K
(Items 7, 8)
Part IV of Form 10-K
(Item 14)
1995 Definitive Proxy Statement dated
June 9, 1995 Part III of Form 10-K
(Items 10, 11, 12, 13)
TABLE OF CONTENTS
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MODINE MANUFACTURING COMPANY - FORM 10-K
FOR THE YEAR ENDED MARCH 31, 1995
10-K Pages
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COVER
TABLE OF CONTENTS
PART I
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Item 1 - Business
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General, Foreign and Domestic Operations,
Competitive Position, Customer Dependence,
Backlog of Orders, Raw Materials, Patents,
Research and Development, Environmental
Matters, Employees, Seasonal Nature of
Business, Working Capital Items 5
Item 2 - Properties 12
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Item 3 - Legal Proceedings 13
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Item 4 - Submission of Matters To A Vote of Security
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Holders 14
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PART II
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Item 5 - Market for Registrant's Common Equity and
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Related Stockholder Matters 15
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Item 6 - Selected Financial Data 16
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Item 7 - Management's Discussion and Analysis of
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Financial Condition and Results of Operations 16
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Item 8 - Financial Statements & Supplementary Data 16
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Item 9 - Changes in and Disagreements with Accountants
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on Accounting and Financial Disclosure 16
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10-K Pages
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PART III
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Items 10 and 11 - Directors and Executive Officers
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of the Registrant; Executive Compensation 17
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Item 12 - Security Ownership of Certain Beneficial Owners
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and Management 18
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Item 13 - Certain Relationships and Related Transactions 18
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PART IV
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Item 14 - Exhibits, Financial Statement Schedules, and
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Reports on Form 8-K 19
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1) Financial Statements
2) Financial Statement Schedules
3) Consent of Independent Accountants
4) Exhibit Index
SIGNATURES 26
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PART I
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ITEM 1. BUSINESS.
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General
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Throughout this Report, the terms "Modine," "the Company" and/or "the
Registrant" refer to Modine Manufacturing Company and consolidated
subsidiaries.
Modine was incorporated under the laws of the State of Wisconsin
on June 23, 1916.
Modine operates primarily in a single industry consisting of the manufacture
and sale of heat transfer equipment. This includes heat exchangers for
cooling all types of engines, transmissions, auxiliary hydraulic equipment,
air conditioning components used in cars, trucks, farm and construction
machinery and equipment, and heating and cooling equipment for residential
and commercial building HVAC (heating, ventilating, air conditioning and
refrigeration equipment). The principal markets consist of automobile,
truck and bus manufacturers, farm implement manufacturers, heating and
cooling equipment manufacturers, construction equipment manufacturers,
construction contractors, wholesalers of plumbing and heating equipment,
radiator repair shops, and wholesalers of auto repair parts. The Company
distributes its products through Company salesmen, through independent
manufacturer's representatives, independent warehouse distributors, and
mass merchandisers. No industry segment information is required under
Statement of Financial Accounting Standards Board, Number 14 "Financial
Reporting for Segments of a Business Enterprise," since the Company
operates predominantly in a single industry.
Within this industry, the Company manufactures various products as is
demonstrated by the following table:
Years ended March 31
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1995 1994 1993 1992 1991
Radiators & Radiator Cores 42% 45% 45% 45% 51%
Oil Coolers 16% 15% 13% 13% 13%
Vehicular Condensers
& Evaporators 14% 12% 12% 13% 10%
Charge Air Coolers 12% 11% 10% 7% 6%
Building HVAC 9% 11% 14% 15% 14%
Miscellaneous 7% 6% 6% 7% 6%
A world trend has been consolidation to fewer but larger suppliers in the
markets the Company serves. To serve its global markets, Modine has
established manufacturing operations in North America, Europe, and
Asia/Pacific. The Company's significant international operations are
located in the following countries:
North America
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The Company maintains a Canadian subsidiary, Modine of Canada, Ltd., an
Ontario company, which manufactures cores for the automotive aftermarket,
and which owns 100% of The Radman Corporation, Inc., a Canadian federal
company which licenses certain trademarks to automotive radiator repair
shops.
In May, 1995, the Company purchased its joint venture partner's 57% interest
in Radinam S.A., a Mexican producer of radiators and other automotive
components for original equipment manufacturers and the automotive
aftermarket. Radinam's manufacturing facilities are located in Mexico City.
South America
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During the past fiscal year, the Company sold its 36% joint venture interest
in McQuay do Brasil Industria e Comercio Ltda., a Brazilian manufacturer of
condensers and evaporators for the Brazilian automotive market and
miscellaneous refrigeration products.
Europe
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The Company operates a subsidiary, NRF Holding B.V., a Dutch company. NRF
produces replacement radiator cores, sheet metal radiators, and industrial
and marine heat exchangers. NRF also owns subsidiaries that export products
and distribute products throughout Europe.
The Company operates a subsidiary, Modine GmbH, based in Neuenkirchen,
Germany, which manufactures copper/brass sheet metal radiators for the
European industrial and agricultural markets.
In May, 1995 the Company, through its subsidiary NRF Holding B.V., acquired
Radiadores Montana S. A., a Spanish manufacturer and distributor of radiators,
radiator cores, oil coolers, heaters, and air conditioning condensers and
evaporators for the automotive aftermarket and for industrial applications.
In the third quarter of fiscal 1993-94, the Company acquired, through Modine
GmbH, the entire equity interest in Heinrich Langerer & Reich GmbH & Co.
("L&R") and certain specified liabilities. The acquisition includes plant,
equipment, and certain real property located in Pleizhausen, Germany, and the
equipment and leasehold interest in certain real property located in
Filderstadt-Bernhausen, Germany. The acquisition also includes the equity
interest held by Langerer & Reich in Hungaro Langerer Gepjarmutechnikai Kft.,
a Hungarian company. The Filderstadt-Bernhausen operation manufactures
non-ferrous metal and aluminum heat exchangers for the truck, bus, and
industrial markets and also includes research and development and
administrative facilities. The Pleizhausen operation manufactures aluminum
heat exchangers for the passenger car market.
In the fiscal 1994-95, an unoccupied NRF facility located in Uden, The
Netherlands was converted to allow production of aluminum vacuum brazed
products beginning in the fall of 1994. Modine Uden B.V. operates as part
of the L&R Automotive business group.
In the fourth quarter of fiscal 1993-94, the Company acquired its partner's
(Austria Metall AG) 50-percent ownership in the joint venture company Austria
Warmetauscher GmbH ("AWG"). The AWG facility, located in Berndorf, Austria,
manufactures aluminum air-conditioning condensers and oil coolers for a number
of European auto makers.
The European operations have been reorganized into three business groups and
two support groups.
The three business groups are: (1) L & R Automobiltechnik, an automotive
business unit. It includes the L&R plant in Pleizhausen, Germany; AWG in
Austria; and a new plant location in Uden, The Netherlands; (2) L & R Heavy
Duty business unit which includes the operations in Neuenkirchen and the L&R
facilities in Bernhausen, Germany, and in Mezokovesd, Hungary; and (3) an
aftermarket business unit that operates under the aegis of the automotive
business unit. It includes NRF Holding BV.
The two support groups are: (1) a European central research group, that is
similar to Modine's Research and Development Department in Racine, Wisconsin;
and (2) a European central administration unit, that includes the functions
of MIS (Management Information Services); purchasing; quality and environment;
and the accounting functions of controlling, cost accounting, and financial
accounting.
The European operations are organized similarly to the way the Company is
organized in the United States, which allows Modine to be able to better
serve its markets in Europe with manufacturing in Europe.
The Company maintains sales subsidiaries and/or offices in Austria, England,
France, Italy, Germany, and The Netherlands.
The Company also maintains stocks of goods in bulk warehouses in Birmingham,
England; Rotterdam, The Netherlands; and Bremen, Germany as reserve inventory
for certain European customers.
Asia/Pacific
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The Company participates (50% interest) in a joint venture with Nippon Light
Metal, Ltd., a Japanese company. The joint venture company, Nikkei Heat
Exchanger Company, Ltd., produces automotive heat exchangers for sale to
original equipment manufacturers in the Japanese market.
The Company established a sales subsidiary in Japan, Modine Asia K.K., in
February, 1995.
Exports
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In addition, the Company exports to foreign countries and receives royalties
from foreign licensees. Export sales as a percentage of total sales were
13.8%, 14.3% and 14.0% for fiscal years ended in 1995, 1994 and 1993,
respectively. Estimated after-tax earnings on export sales as a percentage
of total net earnings were 13.8%, 14.3% and 14.0% for fiscal years ended in
1995, 1994 and 1993, respectively. Royalties from foreign licensees as a
percentage of total earnings were 1.0%, 2.1% and 5.4% for the last three
fiscal years, respectively.
Modine believes its international presence has positioned the Company to
profitably share in the anticipated long-term growth of the global vehicular
and industrial markets. Modine is committed to increasing its involvement
and investment in international markets in the years ahead.
Foreign and Domestic Operations
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Financial information relating to the Company's foreign and domestic
operations, including export sales, is included in the Company's 1995 Annual
Report to Shareholders and is incorporated herein by reference at Note 19 on
Page 27 therein.
Events Subsequent to the End of the Quarter
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On April 24, 1995, The Equion Corporation and Modine announced a letter of
intent for Modine to purchase all of the business and assets of the Signet
Systems Division of Equion. The cash transaction is subject to a definitive
agreement and the approval of the boards of directors of both companies.
Signet is a full-service supplier of climate-control systems and components
to the automotive, truck, and off-highway vehicle markets both in North
America and Europe. Annualized sales are approaching $90 million. Signet
has a manufacturing plant in Harrodsburg, KY. The acquisition is expected
to close by the end of July.
On May 3, 1995, National Tube Holding Company, Inc., of Birmingham, Alabama,
and Modine announced a letter of intent for the acquisition of Modine's copper
tubing manufacturing business and assets located in Dowagiac, Michigan, by
National Tube. The purchase is subject to the approval of the boards of
directors of both companies and the working out of a definitive agreement.
The acquisition is expected to close by the end of August.
Competitive Position
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The Company competes with several manufacturers of heat transfer products,
some of which are divisions of larger companies and some of which are
independent companies. The Company also competes for business with parts
manufacturing divisions of some of its major customers. The markets for
the Company's products are increasingly competitive and have changed
significantly in the past few years as the Company's traditional OEM
customers in the United States, faced with dramatically increased
international competition, have expanded their worldwide sourcing of
parts to better compete with lower-cost imports. These market changes
have caused the Company to experience competition from suppliers in other
parts of the world which enjoy economic advantages such as lower labor
costs, lower health care costs, and other factors.
Customer Dependence
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Ten customers accounted for approximately 34.8% of the Company's sales
in the fiscal year ended March 31, 1995. These customers, listed
alphabetically, were: American Honda Motor Co., Inc., BMW, Caterpillar
Company, Chrysler Motor Corporation, Fiat, Ford Motor Company, MAN Truck,
Navistar, Paccar, Inc., and Volkswagen. Goods are supplied to these
customers on the basis of individual purchase orders received from them.
When it is in the customer's and the Company's best interests, the Company
utilizes long-term supply agreements to minimize investment risks and provide
a proven source of competitively priced products. There are no other
relationships between the Company and its customers.
Backlog of Orders
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While the Company has a large backlog of orders, the backlog is not deemed
significant or material; backlog historically has had little relation to
shipments. Modine's products are produced from readily available materials
such as copper, brass and aluminum and have a relatively short manufacturing
cycle. The Company's operating units maintain their own inventories and
production schedules. Current production capacity is capable of handling
the sales volumes expected in fiscal 1995-1996.
Raw Materials
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Copper, brass, aluminum, steel, and solder, all essential to the business,
are purchased regularly from several domestic and foreign producers. The
Company normally does not experience material shortages within its operations
and believes that producers' supplies of these materials through the end of
fiscal year 1996 will be adequate.
Patents
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The Company, and certain of its wholly-owned subsidiaries, own outright or
are licensed to produce products under a number of patents and licenses.
These patents and licenses, which have been obtained over a period of years,
will expire at various times. Because the Company is involved with many
product lines, the Company believes that its business as a whole is not
materially dependent upon any particular patent or license, or any
particular group of patents or licenses. Modine considers each of its
patents, trademarks and licenses to be of value and aggressively defends
its rights throughout the world against infringement. See also Item 3 -
Legal Proceedings.
Research and Development
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Company-sponsored research activities relate to the development of new
products, processes, or services, or the improvement of existing products,
processes, and services. Expenditures in fiscal 1994-95 amounted to
$10,907,000; in fiscal 1993-94 amounted to $9,509,000; and in fiscal 1992-93
amounted to approximately $8,653,000. There were no significant expenditures
on research activities which were customer-sponsored. Over the course of the
last few years, the Company has become involved in a number of industry or
university sponsored research organizations. These consortia conduct research
and provide data on technical topics deemed to be of interest to the Company
for practical applications in the markets the Company serves. The research
and data developed is generally shared among the member companies. In
addition, to achieve efficiencies and lower developmental costs, Modine's
research and engineering groups work closely with Modine's customers on
special projects and system designs.
Environmental Matters
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It is Modine's policy to comply with all environmental laws and regulations
without regard to the degree of enforcement. In addition, the Company
analyzes its business decisions, operations and processes to find ways to
eliminate or curtail pollution. Consistent with this philosophy, the Company
amended its corporate environmental policy in 1991 to include a waste
minimization program. This program established a corporate-wide goal of a
65% reduction in waste by the end of 1995. The Company has achieved
reductions of nearly 60% through calendar year 1994. Although environmental
compliance costs are substantial, the Company has no reason to believe such
costs vary significantly from similar costs incurred by other companies
engaged in similar businesses.
In addition to the various federal, state and local environmental laws and
regulations governing its operations and products, the Company (as well as
its competitors) is required to incur expenses for remedial actions at
various facilities and waste disposal sites. An obligation to take such
action may result from current laws, such as the federal Superfund law, or
the issuance of new regulations, or as the result of accidental leaks or
spills in the ordinary course of business. In addition, an obligation may
arise when a facility is closed or sold. These expenditures most often
relate to facilities and sites where past operations followed practices
and procedures that were considered acceptable under then-existing
regulations, but will now require investigatory and/or remedial work to
ensure sufficient protection to the environment.
Although there are no currently known liabilities that might have a material
effect on the Company's consolidated net assets, the Environmental Protection
Agency ("EPA") has designated Modine as a potentially responsible party
("PRP") for remediation of five hazardous waste sites. Under the federal
Superfund law, joint and several liability is imposed on all owners, operators
and generators involved at the designated sites. However, because of Modine's
extremely limited involvement as a generator of hazardous waste, it is
unlikely Modine would be required to make a material financial contribution
for remediation. At two of these sites, no evidence exists to establish that
Modine ever disposed of its hazardous wastes there; at the remaining three
sites, Modine's involvement is as a de minimis PRP (potentially responsible
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party), having less than a one percent share of the wastes disposed.
Five of the Company's manufacturing facilities currently have been identified
as requiring soil and/or water remediation. Because of the joint and several
liability of former landowners, contractual obligations, and certain state
programs that provide for partial reimbursement of certain remediation costs,
it is unlikely these remediation efforts will have a material effect on
the Company's consolidated financial condition.
The 1990 amendments to the Clean Air Act require a significant increase in
capital equipment expenditures over the next decade. For the fiscal year
ending March 31, 1995 capital expenditures and expenses were $1,918,500.
These environmental expenditures include capital outlays to retrofit existing
facilities, as well as those associated with new facilities and other
compliance costs. The expenditures relate mostly to air and water quality
projects and site clean-up activities at the Company's facilities.
In fiscal 1995-96 approximately $2,000,000 may be invested in air and water
pollution control equipment, process changes, underground tank modifications
and hazardous waste minimization equipment and programs in order to comply
with existing and new federal, state and local environmental laws and
regulations. Operating expenses of some facilities may be increased
because of such equipment but the competitive position of the Company is not
expected to change materially.
Employees
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The number of persons employed by the Company at March 31, 1995,
was approximately 7,600.
Seasonal Nature of Business
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In recent years the Company's business has become more continuous and less
seasonal. However, a degree of seasonality may still be experienced since
the Aftermarket, Commercial Products, and Heating Divisions are affected by
weather patterns, constructions starts, and other factors. Sales to original
equipment manufacturers are dependent upon the demand for new vehicles and
equipment. The following quarterly net sales detail for the past five years
illustrates the degree of fluctuation:
Fiscal Year Fiscal
Ended First Second Third Fourth Year
March 31 Quarter Quarter Quarter Quarter Total
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($ In Thousands)
1995 $208,436 $221,760 $240,505 $242,309 $913,010
1994 147,171 156,964 172,351 193,067 669,553
1993 133,817 144,603 146,591 145,828 570,839
1992 125,879 132,702 130,805 137,194 526,580
1991 114,351 118,608 126,483 122,540 481,982
Five-year $145,931 $154,927 $163,347 $168,188 $632,393
average
Percent of 23% 24% 26% 27% 100%
Year
Working Capital Items
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The Company's products for the original equipment market are manufactured on
an as ordered basis. Therefore, large inventories of such products are not
necessary, nor is the amount of products returned significant. In the HVAC
and aftermarket areas, due to the distribution systems and seasonal sales
programs, varying levels of finished goods inventory are necessary. This
inventory is spread throughout the distribution systems. In these areas,
in general, the industry and the Company make use of extended terms of
payment for customers on a limited and/or seasonal basis.
ITEM 2. PROPERTIES.
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The Company's general offices, along with laboratory, experimental and
tooling facilities, are maintained in Racine, Wisconsin. Almost all of the
Company's manufacturing and larger distribution centers are owned outright.
A few manufacturing facilities and numerous regional sales and service
centers, distribution centers and offices are occupied under various lease
arrangements.
The Company's facilities, on a geographic basis, are as follows:
Type of North Asia/
Facility America Europe Pacific Total
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Manufacturing 20 8 28
Distribution 4 1 5
Sales & Service
Centers/Offices 13 15 1 29
Joint Ventures 1 1
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Total 37 24 2 63
Total square footage of the 63 facilities is approximately 6,250,100 square
feet.
The Company currently uses its facilities for the purposes as noted above.
The Company's facilities, in general, are well maintained and conform to the
sales, distribution, or manufacturing operations for which they are being
used, and their productive capacity is, from time to time, adjusted and
expanded as necessitated by product market considerations and customer
growth.
ITEM 3. LEGAL PROCEEDINGS.
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In the normal course of business, the Company and its subsidiaries are named
as defendants in various lawsuits and enforcement proceedings by private
parties, the Occupational Safety and Health Administration, the Environmental
Protection Agency, other governmental agencies, and others in which claims,
such as personal injury, property damage, or antitrust and trade regulation
issues, are asserted against the Company. While the outcome of these
proceedings is uncertain, in the opinion of the Company's management and
counsel, any liabilities that may result from such proceedings are not
reasonably likely to have a material effect on the Company's liquidity,
financial condition or results of operations. Many of the pending damage
claims are covered by insurance and, in addition, the Company from time to
time establishes reserves for uninsured liabilities.
The Mitsubishi and Showa Litigation
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In November, 1991, the Company filed a lawsuit in the Federal District Court
in Milwaukee, Wisconsin against Mitsubishi Motor Sales of America, Inc. and
Showa Aluminum Corporation, alleging infringement of the Company's Patent
No. 4,998,580 on parallel-flow air-conditioning condensers. The suit seeks
an injunction to prohibit continued infringement and accounting for damages,
a trebling of such damages for willful infringement, and reimbursement of
attorneys' fees. In December of 1991, the Company submitted a complaint to
the U. S. International Trade Commission (ITC) requesting that the ITC ban
the import and sale of parallel-flow air-conditioning condensers and systems
or vehicles that contain them, which are the subject of the aforementioned
lawsuit. In July, 1993, the ITC reversed an earlier ruling by a hearing
officer and upheld, as valid and enforceable, the Company's 4,998,580 patent
on parallel-flow air-conditioning condensers. The ITC also ruled that
specific condensers from the two Japanese companies did not infringe the
Company's patent. Each of the parties appealed to the U.S. Court of Appeals
for the Federal Circuit the portion of the ITC opinion adverse to them. In
July of 1994, Showa filed a lawsuit against the Company in the Federal
District Court in Columbus, Ohio alleging infringement by the Company of
Showa's patents pertaining to double circuit condensers and baffles therefor
(In June, 1995, the Company filed a motion for partial summary judgment
against such lawsuit). In December of 1994, the Company filed another
lawsuit against Mitsubishi Motor Sales of America, Inc. and Showa Aluminum
Corporation in the Federal District Court in Milwaukee, Wisconsin pertaining
to the Company's newly-issued Patent No. 5,372,188 also pertaining to
parallel-flow air-conditioning condensers. All legal and court costs
associated with these cases have been expensed as they were incurred.
The McHenry EPA Litigation
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In June 1991, the U.S. Department of Justice, acting at the request of
the federal Environmental Protection Agency (EPA), filed suit against
the Company in the U.S. District Court for the Northern District of
Illinois. The complaint alleged violations of the federal Clean Water
Act at a manufacturing facility owned by the Company in McHenry, Illinois.
The alleged violations consisted of effluent discharges in excess of
permitted amounts and noncompliance with reporting and monitoring
requirements. Settlement negotiations have resulted in an agreement
whereby the Company has paid a fine of $750,000 and agreed to change the
effluent discharge system. Full reserves were established in fiscal 1993
for the fine and the $1,300,000 necessary for pond sludge removal. All
legal and court costs associated with the case have been expensed as they
were incurred.
Other previously reported legal proceedings have been settled or the issues
resolved so as to not merit further reporting.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
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Omitted as not applicable.
PART II
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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
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STOCKHOLDER MATTERS.
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The Company's Common Stock is quoted on the National Association of Securities
Dealers' Automated Quotation system ("NASDAQ") as a National Market issue.
The Company's trading symbol is "MODI." The table below shows the range of
high and low bid information for the Company's Common Stock for fiscal years
1994-95 and 1993-94. As of April 1, 1995, shareholders of record numbered
approximately 4,046; it is estimated that beneficial owners numbered at
least 12,000.
1994-95* 1993-94*
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Quarter High Low Dividends High Low Dividends
First $30.00 $23.75 $.13 $22.75 $19.50 $.115
Second 29.00 24.75 .13 23.75 19.75 .115
Third 31.25 25.25 .13 30.25 22.50 .115
Fourth 34.75 27.00 .13 31.25 24.75 .115
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TOTAL $.52 $.460
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* Adjusted for stock splits and stock dividends.
Certain of the Company's loan agreements limit the use of retained earnings
for the payment of cash dividends and the acquisition of treasury stock.
Under the most restrictive, $100,393,000 was available for these purposes
at March 31, 1995. (These restricted payments may not exceed $30,000,000
in any fiscal year.) In October 1986, the Company adopted a shareholder
rights plan and issued one right for each share of common stock. The rights
are not currently exercisable but will become exercisable 10 days after a
shareholder has acquired 20 percent or more, or commenced a tender or
exchange offer for 30 percent or more, of the Company's common stock.
Each right will initially entitle the holder to purchase a unit of 1/100
Preferred Series A Participating Stock at $21.25 per unit. However, in the
event of certain mergers, sales of assets, or self-dealing transactions
involving a 20 percent or more shareholder, each right not owned by such
20 percent or more shareholder will be modified so that it will then be
exercisable for common stock having a market value of twice the exercise
price of the right. The rights are redeemable in whole by the Company, at
a price of $.0125 per right, at any time before 20 percent or more of the
Company's common stock has been acquired. On January 18, 1995, the Board
of Directors of the Company authorized the amendment of the Rights Agreement
by extending the final expiration date of the Rights from October 27, 1996
to October 27, 2006. Accordingly, the Rights expire on October 27, 2006,
unless previously redeemed.
ITEM 6. SELECTED FINANCIAL DATA.
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Fiscal Year ended March 31
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1995 1994 1993 1992 1991
Sales (in thousands) $913,010 $669,553 $570,839 $526,580 $481,982
Net earnings (in
thousands) 68,442 43,990*** 19,987** 28,019 30,472
Total assets (in
thousands) 590,187 509,981 405,187 383,475 398,248
Long-term debt (in
thousands) 62,220 77,646 52,350 74,295 88,071
Dividends per share* .52 .46 .42 .38 .34
Net earnings per share* 2.24 1.44*** .66** .93 1.02
* Adjusted for stock splits and stock dividends.
** Includes recognition of an accounting change from the adoption of FAS 106,
resulting in a one-time after-tax expense of $13,700,000, or $.46 per
share.
***Includes recognition of an accounting change from the adoption of FAS 109,
resulting in a one-time after-tax benefit of $899,000, or $.03 per share.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
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AND RESULTS OF OPERATIONS.
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Certain information required hereunder is incorporated by reference from the
Company's 1994-95 Annual Report to Shareholders, pages 4, 7, 8, 11, 12, 14,
15, 16, and 18, attached as Exhibit 13.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
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The report of Coopers & Lybrand dated May 1, 1995, the Consolidated
Statements of Earnings, and the related Consolidated Balance Sheets, Cash
Flows, Shareholders' Investment, and Notes to Consolidated Financial
Statements, appearing on pages 15, 17, 19, 20, and 21-29 of the Company's
1994-95 Annual Report to Shareholders are incorporated herein by reference.
With the exception of the aforementioned information, no other data appearing
in the 1994-95 Annual Report to Shareholders is deemed to be filed as part of
this Annual Report on Form 10-K. Individual financial statements of the
Registrant are omitted because the Registrant is primarily an operating
company, and the subsidiaries included in the consolidated financial
statements are wholly-owned.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
- ------ -----------------------------------------------------------
AND FINANCIAL DISCLOSURE.
------------------------
There were no disagreements on accounting or financial disclosures between
the Company and its auditors.
PART III
ITEMS 10 and 11. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT;
- --------------- ---------------------------------------------------
EXECUTIVE COMPENSATION.
----------------------
The information about directors and executive officers and executive
compensation on pages 2 - 4 and pages 8, 9, 12, and 13, of the Company's
definitive Proxy Statement dated June 9, 1995 under the headings "Election
of Directors", "Nominees to be Elected," "Directors Continuing in Service,"
and "Executive Compensation" attached to this report is incorporated herein
by reference, but excluding the Officer Nomination and Compensation Committee
Report on Executive Compensation and the Performance Graph on pages 10 - 12.
Executive Officers of Registrant
Officer
Name Age Position Since
---- --- -------- ------
R. T. Savage 56 President and Chief Executive Officer 1981
D. R. Johnson 53 Executive Vice President, Operations 1988
W. E. Pavlick 61 Senior Vice President, General Counsel
and Secretary 1979
V. S. Frangopoulos 59 Group Vice President, Off-Highway
Products 1981
M. G. Baker 55 Group Vice President, Distributed
Products 1987
L. D. Howard 51 Vice President and General Manager,
Modine Europe 1991
D. B. Rayburn 47 Group Vice President, Highway Products 1991
J. R. Dougall 59 Vice President and General Manager,
Heating Division 1985
J. H. Firestone 57 Vice President, Quality & Environment 1990
J. J. Hankey 45 Vice President and General Manager,
Commercial Products Division 1992
R. L. Hetrick 53 Vice President, Human Resources 1989
R. W. Possehl 50 Vice President, Administration 1985
A. D. Reid 53 Vice President, Finance and Chief
Financial Officer 1985
Z. P. Saperstein 64 Vice President, Technical Services 1983
R. S. Bullmore 45 Corporate Controller 1983
R. M. Gunnerson 46 Treasurer 1977
D. R. Zakos 41 Associate General Counsel and
Assistant Secretary 1985
There are no family relationships among the executive officers and directors.
All of the above officers have been employed by Modine in various capacities
during the last five years, except D. B. Rayburn and J. J. Hankey. Mr.
Rayburn joined the Company on February 18, 1991. Mr. Rayburn was Director
of Manufacturing for the Off-Highway Product and Drive Line Division of
Rockwell International Corporation, a manufacturer of military aircraft
and aerospace products, components for heavy duty highway and off-highway
vehicles and automobiles, high speed printing presses and controllers for
factory automation. Mr. Hankey joined the Company on October 18, 1990 at
the time of Modine's acquisition of the Heat Transfer Division of Sundstrand
Corporation. Mr. Hankey was Controller of the Heat Transfer Division, which
produces refrigeration and air conditioning coils, secondary heat exchangers
for high-efficiency residential furnaces, extruded copper tubing, and complex
copper and aluminum tubular components. There are no arrangements or
understandings between any of the above officers and any other person pursuant
to which he was elected an officer of Modine. Officers are elected annually
at the first meeting of the Board of Directors after the Annual Meeting of
Shareholders. Mr. Savage and Mr. Pavlick have employment agreements with the
Company.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
- ------- --------------------------------------------------------------
The information relating to stock ownership on pages 5 - 7 of the Company's
definitive Proxy Statement dated June 9, 1995 under the headings "Principal
Shareholders and Share Ownership of Directors and Executive Officers,
"Principal Shareholders," and "Securities Owned by Management" attached to
this report is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
- ------- ----------------------------------------------
The information required by this item is incorporated by reference from the
Company's definitive Proxy Statement dated June 9, 1995 on page 14 under the
heading "Transactions" attached to this report.
PART IV
-------
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
- ------- -------------------------------------------------------
FORM 8-K.
--------
(a)The following documents are filed as part of this Report:
Page in
Annual Report*
-------------
(1)Financial Statements:
Consolidated Statements of Earnings for the years ended
March 31, 1995, 1994, and 1993 15
Consolidated Balance Sheets at March 31, 1995 and 1994 17
Consolidated Statements of Cash Flows for the years
ended March 31, 1995, 1994, and 1993 19
Consolidated Statements of Shareholders' Investment
for the years ended March 31, 1995, 1994,
and 1993 20
Notes to Consolidated Financial Statements 21 - 28
Independent Auditors' Report 29
* Incorporated by reference from the indicated pages of
the 1994-95 Annual Report to Shareholders
Page in
Form 10-K
---------
(2)Financial Statement Schedules:
Report of Independent Accountants on Financial Statement
Schedules for the three years ended March 31, 1995 28
Schedule II - Valuation and Qualifying Accounts for the
years ended March 31, 1995, 1994 and 1993 113
(3)Consent of Independent Accountants 95
(4)Exhibit Index 20
(b)All other schedules have been omitted as they are not applicable,
not required, or because the required information is included in the
financial statements.
The following exhibits are attached for information only unless
specifically incorporated by reference in this Report:
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ----
2 Not applicable.
3(a) Restated Articles of Incorporation (as amended)
(filed by reference to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
March 31, 1994).
3(b) Restated By-Laws (as amended) (filed by
reference to the Registrant's Annual Report
on Form 10-K for the fiscal year ended
March 31, 1994).
4(a) Specimen Uniform Denomination Stock Certificate
of the Registrant (filed by reference to the
Registrant's Annual Report on Form 10-K for the
fiscal year ended March 31, 1993).
4(b) Rights Agreement dated as of October 16, 1986
between the Registrant and First Chicago Trust
Company of New York (Rights Agent) (filed by
reference to the Registrant's Annual Report
on Form 10-K for the fiscal year ended
March 31, 1992).
4(b)(i) Rights Agreement Amendment No. 1 dated as of
January 18, 1995 between the Registrant and
First Chicago Trust Company of New York (Rights
Agent) (filed by reference to the exhibit
contained within the Registrant's Current
Report on Form 8-K dated January 13, 1995.)
4(b)(ii) Rights Agreement Amendment No. 2 dated as of
January 18, 1995 between the Registrant and
First Chicago Trust Company of New York (Rights
Agent) (filed by reference to the exhibit
contained within the Registrant's Current
Report on Form 8-K dated January 13, 1995.)
NOTE: The amount of long-term debt authorized under any
----
instrument defining the rights of holders of long-term debt
of the Registrant, other than as noted above, does not exceed
ten percent of the total assets of the Registrant and its
subsidiaries on a consolidated basis. Therefore, no such
instruments are required to be filed as exhibits to this
Form 10-K. The Registrant agrees to furnish copies of such
instruments to the Commission upon request.
9 Not applicable.
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ----
10(a) Director Emeritus Retirement Plan (effective
April 1, 1992) (filed by reference to the
Registrant's Annual Report on Form 10-K for
the fiscal year ended March 31, 1992).
10(b) 1978 Incentive Stock Plan (as amended) (filed
by reference to the Registrant's Annual Report
on Form 10-K for the fiscal year ended March 31,
1993).
10(c) Employment agreements between the Registrant
and R. T. Savage and W. E. Pavlick (filed by
reference to the Registrant's Annual Report on
Form 10-K for the fiscal year ended March 31,
1992).
10(d) 1985 Incentive Stock Plan (as amended) (filed
by reference to the Registrant's Annual Report
on Form 10-K for the fiscal year ended March 31,
1992).
10(e) 1985 Stock Option Plan for Non-Employee Directors
(as amended) (filed by reference to the
Registrant's Annual Report on Form 10-K for the
fiscal year ended March 31, 1994).
10(f) Pension and Disability Plan For Salaried Employees
of Modine Manufacturing Company (as amended)
(filed by reference to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
March 31, 1994).
*10(g) Executive Supplemental Retirement Plan
(as amended). 29
10(h) 1989 Stock Award Plan [a part of the 1985
Incentive Stock Plan].
Note: The 1989 Plan is not materially
----
different from the 1987 Stock Award Plan
filed with the Registrant's Annual Report
on Form 10-K for the fiscal year 1993.
10(i) Modine Manufacturing Company Executive
Supplemental Stock Plan (as amended) (filed
by reference to the Registrant's Annual Report
on Form 10-K for the fiscal year ended March 31,
1994).
10(j) Director Emeritus Agreements between the
Registrant and Neal D. Crane and Bernard H.
Regenburg (filed by reference to the Registrant's
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ----
Annual Report on Form 10-K for the fiscal year
ended March 31, 1992).
10(k) Trust agreement relating to Two Million Dollar
split life insurance policy by and among the
Registrant, E. E. Richter and his spouse, and
Marshall & Ilsley Trust Company as Trustee
(filed by reference to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
March 31, 1994).
10(l) 1990 Stock Award Plan [a part of the 1985
Incentive Stock Plan].
Note: The 1990 Plan is not materially different
----
from the 1987 Stock Award Plan filed with the
Registrant's Annual Report on Form 10-K for the
fiscal year 1993.
10(m) 1991 Stock Award Plan [a part of the 1985
Incentive Stock Plan].
Note: The 1991 Plan is not materially different
----
from the 1987 Stock Award Plan filed with the
Registrant's Annual Report on Form 10-K for the
fiscal year 1993.
10(n) Consulting Agreement between the Registrant and
E. E. Richter (filed by reference to the
Registrant's Annual Report on Form 10-K for the
fiscal year ended March 31, 1992).
10(o) 1992 Stock Award Plan [a part of the 1985
Incentive Stock Plan].
Note: The 1992 Plan is not materially different
----
from the 1987 Stock Award Plan filed with the
Registrant's Annual Report on Form 10-K for the
fiscal year 1993.
10(p) 1993 Stock Award Plan [a part of the 1985
Incentive Stock Plan].
Note: The 1993 Plan is not materially different
----
from the 1987 Stock Award Plan filed with the
Registrant's Annual Report on Form 10-K for the
fiscal year 1993.
10(q) 1994 Stock Award Plan [a part of the 1985
Incentive Stock Plan].
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ----
Note: The 1994 Plan is not materially different
from the 1987 Stock Award Plan filed with the
Registrant's Annual Report on Form 10-K for the
fiscal year 1993.
10(r) 1994 Incentive Compensation Plan (filed by
reference to the exhibit contained within
the Registrant's 1994 Proxy Statement dated
June 10, 1994).
10(s) 1994 Stock Option Plan for Non-Employee
Directors (filed by reference to the exhibit
contained within the Registrant's 1994 Proxy
Statement dated June 10, 1994).
*10(t) 1994 Stock Award Plan [a part of the 1994
Incentive Compensation Plan]. 34
*10(u) 1995 Stock Option Agreements (incentive and
non-qualified) [a part of the 1994
Incentive Compensation Plan]. 39
*10(v) 1995 Stock Option Agreement [a part of the
1994 Stock Option Plan for Non-Employee
Directors]. 50
*11 Statement re: computation of per share earnings. 56
12 Not applicable.
*13 1994-95 Annual Report to Shareholders. Except
for the portions of the Report expressly
incorporated by reference, the Report is
furnished solely for the information of the
Commission and is not deemed "filed" as a
part hereof. 57
16 Not applicable.
18 Not applicable.
*21 List of subsidiaries of the Registrant. 93
22 Not applicable.
*23 Consent of independent certified public
accountants. 95
24 Not applicable.
*27 Financial Data Schedule 96
28 Not applicable.
Reference Number
per Item 601 of
Regulation S-K Page
- ---------------- ----
*99 Definitive Proxy Statement of the Registrant
dated June 9, 1995. Except for the portions
of the Proxy Statement expressly incorporated
by reference, the Proxy Statement is furnished
solely for the information of the Commission
and is not deemed "filed" as a part hereof. 97
None Appendix (filed pursuant to Item 304 of
Regulation S-T). 114
Note: All Exhibits filed herewith are current to
-----
the end of the reporting period of the Form 10-K
(unless otherwise noted).
* Filed herewith.
Current Reports on Form 8-K:
- ---------------------------
A Current Report on Form 8-K, dated January 18, 1995, was filed by the
Company on January 23, 1995. This report announced the amendment of
the Rights Agreement (regarding certain Preferred Share Purchase Rights
authorized as of October 15, 1986) by extending the final expiration of
the Rights from October 27, 1996 to October 27, 2006.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Modine Manufacturing Company
Date: June 21, 1995 By: R. T. SAVAGE
--------------------------------
R. T. Savage, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf
of the Registrant and in the capacities indicated.
E. E. RICHTER June 21, 1995
- ------------------------------------- -------------
E. E. Richter, Chairman and Director Date
R. T. SAVAGE June 21, 1995
- ------------------------------------- -------------
R. T. Savage, President, Chief Date
Executive Officer and Director
A. D. REID June 21, 1995
- ------------------------------------- -------------
A. D. Reid, Vice President and Date
Chief Financial Officer
W. E. PAVLICK June 21, 1995
- ------------------------------------- -------------
W. E. Pavlick, Senior Vice President, Date
General Counsel and Secretary
R. J. DOYLE June 21, 1995
- ------------------------------------- -------------
R. J. Doyle, Director Date
T. J. GUENDEL June 21, 1995
- ------------------------------------- -------------
T. J. Guendel, Director Date
F. W. JONES June 21, 1995
- ------------------------------------- -------------
F. W. Jones, Director Date
D. J. KUESTER June 21, 1995
- ------------------------------------- -------------
D. J. Kuester, Director Date
V. L. MARTIN June 21, 1995
- ------------------------------------- -------------
V. L. Martin, Director Date
G. L. NEALE June 21, 1995
- ------------------------------------- -------------
G. L. Neale, Director Date
S. W. TISDALE June 21, 1995
- ------------------------------------- -------------
S. W. Tisdale, Director Date
M. T. YONKER June 21, 1995
- ------------------------------------- -------------
M. T. Yonker, Director Date
Coopers
& Lybrand
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors
Modine Manufacturing Company
Our report on the consolidated financial statements of Modine
Manufacturing Company and Subsidiaries has been incorporated by
reference in this Form 10-K from the 1995 annual report to
shareholders of Modine Manufacturing Company and Subsidiaries on
page 29 therein. In connection with our audits of such financial
statements, we have also audited the related financial statement
schedules listed in the index on page 19 of this Form 10-K.
In our opinion, the financial statement schedules referred to
above, when considered in relation to the basic financial
statements taken as a whole, present fairly, in all material
respects, the information required to be included therein.
COOPERS & LYBRAND LLP
COOPERS & LYBRAND LLP
Chicago, Illinois
May 1, 1995
EXHIBIT 10(g)
MODINE MANUFACTURING COMPANY
EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN
PURPOSE
-------
Modine Manufacturing Company (hereinafter called the "Company")
has adopted the MODINE PENSION AND DISABILITY PLAN FOR SALARIED
EMPLOYEES (hereinafter called the "Pension Plan"), and executed a
Trust Agreement to provide retirement benefits for its employees.
The Pension Plan and Trust is intended to meet requirements of
Section 401(a) and 501(a) of the Internal Revenue Code of 1954,
as amended.
The Pension Plan contains provisions placing limitations on the
maximum benefit which may be paid to a Participant in the Pension
Plan in accordance with Sections 401(a)(17) and 415 of the
Internal Revenue Code.
By resolution of November 14, 1979, the Board of Directors of the
Company determined that the maximum benefit limitations in the
Internal Revenue Code adversely affected the pension benefits of
eligible employees. It therefore authorized the payment of
supplemental retirement benefits of such employees impacted by
these maximum benefit limitations.
As a formal expression on the intent of said resolution of the
Board of Directors, the Company hereby establishes an "Executive
Supplemental Retirement Plan" within the meaning of Sections
201(2), 301(a)(3), and 401(a)(1) of ERISA for a select group of
highly compensated employees, to be effective for any eligible
employee who terminates employment on or after November 14, 1979,
(hereinafter called the "Plan").
ARTICLE I
DEFINITIONS AND CONSTRUCTIONS
-----------------------------
Section 1.1 Definitions: Except as specified below or elsewhere
- ----------- -----------
in this Plan, the definitions of words and phrases appearing in
this Plan shall have the meanings as set forth in the Pension
Plan. Where the following words and phrases appear in this Plan,
they shall have the respective meanings herein set forth, unless
the context clearly indicates to the contrary:
(a) Code: The Internal Revenue Code as now in effect
----
or hereafter amended.
(b) Committee: The Plan Administrator consisting of
---------
at least three officers of the Company who are
appointed by the Officer Nomination and Compensation
Committee of the Company, but who are not members of
the Officer Nomination and Compensation Committee.
(c) Effective Date: November 14, 1979, the date on
--------------
which the provisions of this Plan became effective.
Section 1.2: Except when otherwise indicated by the context,
- -----------
words in a masculine gender shall include the feminine and neuter
gender; the plural shall include the singular and the singular
shall include the plural.
Section 1.3: Employment Rights: Establishment of the Plan shall
- ----------- -----------------
not be construed to give any employee the right to be retained by
the Company or to any benefits not specifically provided by the Plan.
Section 1.4: Severability: In the event any provision of the
- ----------- ------------
Plan shall be held invalid or illegal for any reason, any illegality
or invalidity shall not affect the remaining part of the Plan, but
the Plan shall be construed and enforced as if the illegal or invalid
provisions had never been inserted, and the Company shall have the
privilege and opportunity to correct and remedy such questions of
illegality or invalidity by amendment as provided in the Plan.
Section 1.5. Applicable Law: This Plan is fully exempt from Titles II,
- ----------- --------------
III, and IV of ERISA. The Plan shall be governed and construed in
accordance with Title I of ERISA and the laws of the State of Wisconsin.
ARTICLE II
PARTICIPATION AND ELIGIBILITY
-----------------------------
Section 2.1 Participation: A Participant in the Pension Plan
- ----------- -------------
shall become a Participant in this Plan when any benefits payable
under the Pension Plan are reduced on account of the limitations
in Code Section 415 or Code Section 401(a)(17).
Section 2.2 Other Retirement Benefits: Section 2.1 shall not
- ----------- -------------------------
preclude any Employee who has entered into an agreement with the
Company in which is provided other supplemental retirement
benefits from participating in this plan and receiving such other
supplemental retirement benefits; provided, however, that such
Employee shall not receive the same benefit twice.
ARTICLE III
AMOUNT AND FORM OF BENEFIT PAYMENTS
-----------------------------------
Section 3.1 Amount of Benefits: Benefits payable under the Plan
- ----------- ------------------
shall be equal to:
(a) The amount of benefits payable under the Pension
Plan if the limitations in Code Section 415 and
401(a)(17) were not applied, less
(b) The amount of benefits payable under the Pension Plan.
Section 3.2 Form of Benefit Payments: A Participant may elect
- ----------- ------------------------
the same manner of payment and optional benefits as are provided
in ARTICLE V of the Pension Plan, with the following exceptions:
(a) There is no joint and survivor pension payable to
the spouse of any married Participant who dies before
retiring from or otherwise leaving employment with the
Company.
(b) The monthly benefit to a Participant under the
Plan shall be a monthly benefit only for the life of
the Participant unless the Participant, prior to his
retirement (as defined in the Pension Plan) elects one
of the other optional Forms of Benefit as provided by
the Pension Plan. An election of one optional form of
benefit under the Pension Plan does not affect the
right of the Participant to elect a different form of
optional benefit under this Plan.
(c) Election of an optional form of benefit and
designation of a surviving beneficiary shall be done in
accordance with the rules set forth in the Pension
Plan, except that any such election by a married
Participant shall not require the written consent of
his spouse.
(d) A Participant who is eligible to elect a lump-sum
payment under the Pension Plan, may elect to have a
lump-sum payment under this Plan.
(e) Benefits under this Plan shall commence or be paid
at a time to be determined by the Committee, but not
earlier than the Date of Determination under the
Pension Plan and not later than twelve months after the
Participant has terminated his employment with the
Company.
(f) If the commencement of benefit payments or a lump-
sum payment under this Plan occurs later than the
commencement of benefit payments or a lump-sum payment
under the Pension Plan, the amount of benefits under
this Plan shall be calculated in accordance with
Section 3.1 based upon the pension benefit as of the
date of commencement of benefit payments or the lump-
sum payment under this Plan (but not later than age 65).
Section 3.3 Forfeiture of Benefits: Neither a Participant nor
- ----------- ----------------------
his beneficiary shall have any right to a benefit under this Plan
if the Committee or the Company determines that the Participant
engaged in a willful, deliberate, or gross act of commission or
omission which is injurious to the finances or reputation of the
Company.
ARTICLE IV
GENERAL PROVISIONS
------------------
Section 4.1 Plan Financing: All benefits paid under this Plan
- ----------- --------------
shall be paid from the general assets of the Company. Such
amounts shall be reflected on the accounting records of the
Company but shall not be construed to create or require the
creation of a trust, custodial, or escrow account. No Employee
or Participant shall have any right, title or interest whatever
in or to any investment reserves, accounts, or funds that the
Company may purchase, establish, or accumulate to aid in
providing benefits under this Plan. Nothing contained in this
Plan, and no action taken pursuant to its provisions, shall
create a trust or fiduciary relationship of any kind between the
Company and the Employee or any other person. Neither an
Employee or any beneficiary of an Employee shall acquire any
interest greater than that of an unsecured creditor.
Section 4.2 Administration: This plan shall be administered by
- ----------- --------------
the Committee. The Committee shall have, to the extent
appropriate, the same powers, rights, duties and obligations with
respect to this Plan as it would have if it were charged with the
duties of the Board of Administration under the Pension Plan.
Section 4.3 Amendment and Termination: The Company reserves the
- ----------- -------------------------
right to amend this Plan from time to time and reserves the right
to terminate the Plan at any time, but any such amendment or
termination shall not have the effect of reducing or eliminating
any monthly benefit payable or accrued but not yet payable under
the terms of this Plan as of the date of the amendment or
termination.
Section 4.4 Action by the Company: Any action required of or
- ----------- ---------------------
permitted by the Company under this Plan shall be by resolution
of the Officers Nomination and Compensation Committee of the
Company, the Board of Directors of the Company or any person or
persons authorized by resolution of the Officers Nomination and
Compensation Committee, or the Board of Directors including, but
not limited to, the Committee.
Section 4.5 Tax Liability: The Company may withhold from any
- ----------- -------------
payment of benefits hereunder any taxes required to be withheld
in such sum as the Company may reasonably estimate to be
necessary to cover any taxes for which the Company may be liable
and which may be assessed with regard to such payment.
Section 4.6 Coordination with Pension Plan: Provisions of the
- ----------- ------------------------------
Pension Plan, not specifically excluded or revised by this Plan,
may be applied by the Committee or the Company in determining the
rights and obligations, and any limitations thereon, under this
Plan.
IN WITNESS WHEREOF, MODINE MANUFACTURING COMPANY has caused this
instrument to be executed by its duly authorized officers, this
16th day of July, 1987.
MODINE MANUFACTURING COMPANY
By: /s/FRANK W. JONES
----------------------------
Title: Executive V.P.
----------------------------
ATTEST:
s/W. E. PAVLICK
- ------------------
Secretary
EXHIBIT 10(G) continued
MODINE MANUFACTURING COMPANY
EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN
FIRST AMENDMENT
WHEREAS, the Company established the Modine Manufacturing Company
Executive Supplemental Retirement Plan effective November 14, 1979, and
WHEREAS, it is the desire of the Company to amend such Plan as
hereinafter set forth.
NOW, THEREFORE, the Company does hereby adopt the First Amendment
to the Modine Manufacturing Company Executive Supplemental
Retirement Plan to be effective as of October 1, 1994.
Section 3.2(d), is amended to read as follows in its entirety:
(d) A Participant, upon his retirement, may elect a one-
time lump-sum payment of his benefit under this Plan,
whether or not he is eligible to elect a lump-sum
payment under the Pension Plan.
Except as expressly amended herein, the Modine Manufacturing
Company Executive Supplemental Retirement Plan shall remain in
full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment of the Modine Manufacturing Company Executive
Supplemental Retirement Plan, this 19th day of October, 1994.
MODINE MANUFACTURING COMPANY
By:/s/R. T. SAVAGE
----------------------------
ATTEST:
/s/W. E. PAVLICK
- ----------------
EXHIBIT 10(t)
STOCK AWARD PLAN
1. PURPOSES OF PLAN. The purposes of the Stock Award Plan
of Modine Manufacturing Company ("Modine") are as follows:
A. To further the growth, success and interest of the
Company and its stockholders by enabling key managerial
employees of the Company, who have responsibility for
the administration of the affairs of the Company, to
acquire shares of Modine Common Stock under the terms
and conditions and in the manner contemplated by this
Plan, thereby increasing their personal involvement in
the fortunes of the Company; and
B. To enable the Company to obtain and retain the services
of desirable key managerial employees by providing such
employees with an opportunity to become owners of
Modine Common Stock under the terms and conditions and
in the manner contemplated by this Plan.
The term "Company" as used herein shall mean Modine and its
majority owned subsidiaries, including subsidiaries which may be
created or acquired during the period of this Plan.
2. ADMINISTRATION OF PLAN. This Plan shall be administered
by the Officer Nomination and Compensation Stock Option Committee
consisting of two three or more directors appointed by of the
Board of Directors of Modine, none of whom shall be employees of
the Company. The Committee shall interpret the Plan and to the
extent and in the manner contemplated herein it shall exercise
the discretion granted to it as to the determination of who shall
participate in the Plan, and how many shares shall be awarded to
each participant. The Committee shall issue from time to time
such rules and interpretations as in its judgment are necessary
or appropriate in order to effectively administer the Plan.
3. ELIGIBLE EMPLOYEES. Employees including officers of
the Company who the Committee determines have and exercise
management functions and responsibilities shall be eligible for
participation under the Plan. However, no member of the Board of
Directors of the Company shall be eligible to participate under
the Plan unless such member he is also an employee of the
Company, and no member of the Committee shall be eligible to
participate under the Plan.
4. SHARES SUBJECT TO PLAN. The Board of Directors and the
shareholders of the Company in July 1994 1985 approved a broad
Incentive Compensation Stock Plan providing for an aggregate of
3,000,000 1,250,000 shares of the Common Stock, $0.625 par value
of Modine for various plans adopted by the Board of Directors
under such authority. The 1994 Incentive Compensation Stock Plan
permitted the use of either newly-issued shares, authorized but
heretofore unissued shares, or shares reacquired by the Company,
including shares purchased on the open market. Inasmuch as the
shares of this Plan are awarded to employees without cost,
Wisconsin State law requires that heretofore unissued shares may
not be used but only those shares reacquired by the Company. If
shares issued pursuant hereto shall have been forfeited and
returned to Modine in connection with the restrictions imposed
upon such shares pursuant to this Plan, such forfeited shares
again shall become available for issuance under the Plan prior to
termination of the Plan.
5. RESTRICTIONS. All shares awarded pursuant to this Plan
shall be subject to the following restrictions:
(a) The shares may not be sold or otherwise alienated or
hypothecated as long as they are subject to forfeiture
provided in this Section 5.
(b) In the event of termination with the Company of a
participant prior to the beginning of the third year
after shares are awarded to him hereunder, if such
termination is for any reason other than normal
retirement, death, total disability or early retirement
with the consent of Modine's Board of Directors or the
Committee, the shares shall be forfeited and returned
to the Company; and if such employment so terminates
for any reason other than those described above more
than two (2) years after but prior to the beginning of
the seventh (7) year after the granting of such stock
awards, the shares which are at the date of such
termination of employment still subject to the
restrictions imposed hereunder shall be forfeited and
returned to the Company.
(c) In the event a participant who has been awarded shares
hereunder terminates his employment with the Company
because of normal retirement, death, total disability
or early retirement with the consent of Modine's Board
of Directors or of the Committee, the shares so awarded
shall not be subject to forfeit and shall vest with the
employee, or his the employee's designated legal
representative in the event of death. In the event a
participant is subject to a qualified domestic
relations order, the shares so awarded and to which the
participant is otherwise entitled under the terms of
this Plan shall vest with such person as designated by
the qualified domestic relations order.
(d) Except as otherwise provided above, the restrictions
imposed upon shares awarded to each participant
hereunder shall be removed as to one-fifth of the
aggregate number of shares awarded to him the
participant at one time upon the expiration of each of
the second, third, fourth, fifth, and sixth years after
his the award of such shares hereunder.
(e) In the event at any time the Company is dissolved or is
a party to a merger or consolidation in which the
Company is not the surviving corporation, the
restrictions provided in this Section 5 shall
automatically cease as of the effective date of such
dissolution, merger or consolidation, as the case may be.
(f) Notwithstanding any other terms or conditions contained in
this Plan, the restrictions provided in this Section 5 shall
automatically cease in the event of a voluntary or involuntary
termination with the Company of a participant for any reason
within a two-year period after the occurrence of a Pre-Condition
described below in this subparagraph:
"Pre-Condition" means that a person (as defined in
Section 13(d) and 14(d)(2) of the Securities Exchange
Act of 1934, as amended), or a corporation or other
entity controlled by the person, has
(i) merged or consolidated with the Company,
(ii) acquired substantially all of the assets of
the Company, or
(iii) acquired securities of the Company having
at least 20% of the combined voting power
of the Company's then outstanding securities,
except in the case of a merger of another entity with
the Company where the Company is the surviving corporation,
the merger solely involved an acquisition by the Company of
another business entity in which the Company issued its
authorized but unissued or treasury stock to stockholders
of the acquired entity, and over 80% of the combined voting
power of the Company's stock after the merger is owned of
record by stockholders of the Company prior to the merger.
6. OTHER RESTRICTIONS. The Committee may impose such
other restrictions on any shares awarded pursuant to the Plan as
it may deem advisable, including, without limitation,
restrictions under the Securities Act of 1933 or the Securities
Exchange Act of 1934, as amended, under the requirements of any
stock exchange or any over-the-counter securities trading market
upon which such share or shares of the same class are then listed
and under any blue sky or securities laws applicable to such shares.
7. ESCROW OR LEGEND. In order to enforce the restrictions
imposed upon shares issued hereunder, the Committee may require
any participant to enter into an Escrow Agreement providing that
the certificates representing shares issued pursuant to this Plan
shall remain in the physical custody of an escrow holder until
any or all of the restrictions imposed pursuant to this Plan have
terminated and the Committee may cause a legend or legends to be
placed on any certificates representing shares issued pursuant to
this Plan, which legend or legends shall make appropriate
reference to the restrictions imposed hereunder.
8. AMENDMENTS. This Plan may be amended at any time by
the Board of Directors of Modine, provided that no such amendment
shall increase the maximum number of shares that may be issued
pursuant to the Plan except pursuant to Section 4 hereunder
without the further approval of the stockholders of Modine.
9. TERMINATION. This Plan shall terminate and no further
shares shall be awarded or issued hereunder on January 16, 1995
July 19, 2004 or such earlier date as may be determined by the
Committee. The termination of this Plan, however, shall not
affect any restrictions previously imposed on shares issued
pursuant to this Plan.
EXHIBIT 10(u)
MODINE MANUFACTURING COMPANY
INCENTIVE STOCK OPTION AGREEMENT
THIS INCENTIVE STOCK OPTION granted this day of ,
-------- ------------
19 , by Modine Manufacturing Company, a Wisconsin corporation (the
-----
"Company"), to (the "Employee") under and pursuant
-----------------------
to the Company's 1994 Incentive Compensation Plan, as amended (the "Plan").
WITNESSETH:
WHEREAS, the Committee of the Board of Directors, which is authorized
to administer the Plan (the "Committee"), is of the opinion that the
interests of the Company and its subsidiaries will be advanced by
encouraging and enabling certain key employees of the Company and its
ubsidiaries to acquire or increase their proprietary interest in the
Company, thus providing them with a more direct stake in its welfare and
assuring a closer identification of their interests with those of
the Company; and
WHEREAS, the Committee believes that the acquisition of such
an interest in the Company will stimulate the efforts of such
employees and strengthen their desire to remain with the Company
or one of its subsidiaries;
NOW, THEREFORE, in consideration of the aforementioned, and
the covenants and agreements herein set forth, the Company grants
this option (which is intended to qualify as an incentive stock
option within the meaning of Section 422A of the Internal Revenue
Code) to the Employee on the terms hereinafter expressed:
1. Option Grant. The Company hereby grants to the Employee an
option to purchase a total of shares of Common
-------------
Stock of the Company at the option price of $ per
---------
share, being at least equal to 100% of the fair market value
of such shares on the date hereof.
2. Time of Exercise; Exercise Limitation. This option may be
exercised (in the manner provided in paragraph 3 hereof) in
whole or in part, from time to time after the date hereof,
subject to the following limitations:
(a) Except for exercises under paragraph 5 below, this
option may not be exercised for one year from the date
when the Employee's present employment is first
commenced.
(b) This option is intended to qualify as an incentive
stock option so that the Employee may obtain
preferential tax treatment and, consequently, certain
limitations on disposition must be observed. In order
to obtain preferential tax treatment, shares of capital
stock transferred to the Employee pursuant to this
Agreement may not be disposed of within twenty-four
(24) months after the grant of such shares or twelve
(12) months after exercise of such shares.
(c) If Employee is an officer of the Company subject to the
reporting requirements of Section 16 of the Securities
Exchange Act of 1934, this option may not be exercised
by the Employee for six (6) months from the date of
grant.
(d) This option may only be exercised, at any one time,
exclusively in multiples of twenty-five (25) shares
with a one hundred (100) share exercise minimum, except
for the purchase of all shares then remaining subject
to this option.
(e) This option may not be exercised beyond the shorter of:
(i) ten (10) years from the date hereof;
(ii) after an Employee has been terminated for cause
(such as dishonesty or negligence in performance
of Employee's duties). In such event the
employee shall forfeit all unexercised options;
(iii) three (3) years (except as provided in paragraph
5) following termination of employment (if
without cause) or retirement; provided, however,
that this option must be exercised within ninety
(90) days following termination of employment
(if without cause) or retirement from the
Company in order to obtain preferential tax
treatment.
In the event this option is not exercised in accordance
with subparagraphs (i), (ii) or (iii) above, it shall
be forfeited as an unexercised option.
(f) To the extent required by the Internal Revenue Code,
the aggregate fair market value (determined at the time
the option is granted) of the Common Stock for which
incentive stock options are exercisable for the first
time by an option holder during any calendar year
(under all the plans of the Company) shall not exceed
$100,000. This limitation applies to Incentive Stock
Options granted after 1986 only. Incentive Stock
Options exercisable for the first time in a calendar
year that exceed the $100,000 annual limit are denied
preferential tax treatment.
3. Exercise of Option. This option may be exercised only by
appropriate notice in writing delivered to the Secretary of
the Company at 1500 DeKoven Avenue, Racine, Wis. 53403, and
accompanied by:
(a) Check payable to the order of the Company, or Modine
stock (the value of which shall be the fair market
value of the stock on the day preceding the exercise
date), or a combination of Modine stock and cash, for
the full purchase price of the shares purchased.
4. Nontransferability of Option. This option is not
transferable by the Employee otherwise than (a) by will or
the laws of descent and distribution, or (b) pursuant to a
qualified domestic relations order, and is exercisable,
during the Employee's lifetime, only by the Employee or his
legal representative.
5. Death or Disability of Employee. If the Employee dies
during the option period, this option may be exercised in
whole or in part and from time to time, in the manner
described in paragraph 3 hereof, by the Employee's estate or
the person to whom the option passes by will or the laws of
descent and distribution, but only within a period of (a)
one year next succeeding the Employee's death, or (b) ten
years from the date hereof, whichever period is shorter. If
the Employee becomes disabled during the option period, his
option may be exercised in whole or in part and from time to
time, in the manner described in paragraph 3 hereof, within
one year of retirement or other termination of employment
due to a determination of permanent and total disability;
except that any options exercised after one year of
retirement due to disability, but prior to expiration of
three years following such retirement, will be denied
preferential tax treatment.
6. Delivery of Certificates. The Company shall issue and
deliver certificates for stock purchased pursuant to an
exercise of this option subject to the following
limitations:
(a) The Employee shall have no interest in any such shares
until payment for said shares is made in accordance
with paragraph 3 hereinabove.
(b) The Company shall not be required to issue or deliver
any certificate for its Common Stock purchased upon the
exercise of this option prior to the admission of such
shares to listing on any stock exchange or any
over-the-counter quotation system on which shares may
at that time be listed. In the event of the exercise
of this option while the option class of stock is not
so listed or admitted, the Company shall make prompt
application for such listing or admission. If any time
during the option period the Company shall be advised
by its counsel that the shares deliverable upon an
exercise of the option are required to be registered
under the Federal Securities Act of 1933 or any state
securities law or that delivery of such shares must be
accompanied or preceded by a prospectus, the Company
will use its best efforts to effect such registration
or provide such prospectus, but delivery of shares by
the Company may be deferred until such registration is
effected or such prospectus is available.
7. Adjustment Provisions. In the event that there is any
change in the number of issued shares of Common Stock of the
Company without new consideration to the Company therefor,
by reason of stock dividends, stock split-ups or like
recapitalizations, the number of shares which may thereafter
be purchased under this option shall be adjusted in the same
proportion as said change in issued shares. In such event,
the per share purchase price specified in paragraph 1 above
shall be adjusted so that the total consideration payable to
the Company for the adjusted number of shares remaining
subject to this option shall not be changed by reason of the
adjustment in number of shares.
If during the term of this option the Common Stock of the
Company shall be combined or be changed into the same or
another kind of stock of the Company or into securities of
another corporation, whether through recapitalization,
reorganization, sale, merger, consolidation, or by other
means, the Company shall cause adequate provision to be made
whereby the Employee thereafter will be entitled to receive,
upon the due exercise of any then unexercised portion of
this option, the securities which the Employee would have
been entitled to receive for Common Stock acquired through
exercise of such portion of the option (regardless of
whether or to what extent the option would then have been
exercisable) immediately prior to the effective date of such
recapitalization, reorganization, sale, merger,
consolidation, or similar transaction. If appropriate, due
adjustment shall be made in the per share or per unit price
of the securities purchased on exercise of this option
following said recapitalization, reorganization, sale,
merger, consolidation, or similar transaction.
8. Effect on Other Benefits. Neither this option, shares of
stock issued upon its exercise, any excess of market value
over option price, nor any other rights, benefits, values or
interests resulting from the granting of this option shall
be considered as compensation for purposes of any pension,
profit sharing, retirement plan, insurance plan, investment
or stock purchase plan, or any other employee benefit plan
of the Company or any of its subsidiaries.
9. Fair Market Value. For purposes hereof, "fair market value"
shall equal the closing market price on the largest stock
exchange or over-the-counter quotation system on which
Modine Common Stock is traded on the date a determination is
required to be made under the Plan or this Agreement, or if
no stock is traded on that day then it shall equal the
closing market price on the last preceding day on which such
stock was traded on said exchange or system.
10. Employee Not Deemed to be a Shareholder. The Employee shall
not be deemed to be a shareholder of the Company for any
purposes with respect to any option granted hereunder except
to the extent that such option shall have been exercised and
a stock certificate issued therefor.
11. No Right to Continued Employment. Nothing in this Agreement
or the Plan shall confer upon Employee any right to continue
in the employment of the Company or in any way affect the
right of the Company to terminate Employee's employment at
any time.
12. Cancellation and Rescission of Stock Option. The Committee
may cancel this option at any time if Employee is not in
compliance with all other applicable provisions of this
option, the Plan, and with the following conditions:
(a) Employee shall not render services for any organization
or engage directly or indirectly in any business which,
in the judgment of the Committee, is or becomes
competitive with the Company, or which organization or
business, or the rendering of services to such
organization or business, is or becomes otherwise
prejudicial to or in conflict with the interests of the
Company;
(b) Employee shall comply fully with applicable laws and
government regulations and maintain high ethical
standards. Employee shall also comply with the
Company's corporate policies, including, but not
limited to, Policy No. G-2, Guideline for Business
Conduct, and Policy No. G-3, Antitrust Compliance, and
the Company's Agreement for Protection of Trade Secrets
and Sales Data and for Assignment of Inventions.
If Employee's employment has terminated, the judgment of the
Committee shall be based on Employee's position and
responsibilities while employed by the Company, Employee's
post-employment responsibilities and position with the other
organization or business, the extent of past, current and
potential competition or conflict between the Company and
the other organization or business, the effect on the
Company's customers, suppliers and competitors of Employee's
assuming the post-employment position, and such other
considerations as are deemed relevant given the applicable
facts and circumstances. If Employee retires, he shall be
free, however, to purchase as an investment or otherwise,
stock or other securities of such organization or business
so long as they are listed upon a recognized securities
exchange or traded over-the-counter, and such investment
does not represent a substantial investment to Employee or a
greater than 10 percent equity interest in the organization
or business.
Failure to comply with the provisions of paragraph (a) or
(b) of this Paragraph 13 prior to, or during the twenty-four
(24) months after, any exercise pursuant to this option
shall cause such exercise to be rescinded. The Company
shall notify Employee in writing of any such rescission
within twenty-four (24) months after such exercise. Within
ten days after receiving such a notice from the Company,
Employee shall pay to the Company the amount of any gain
realized or payment received pertaining to the rescinded
exercise of this option. Such payment shall be made either
in cash or by returning to the Company the number of shares
of Common Stock that Employee received in connection with
the rescinded exercise.
13. Grant Subject to 1994 Incentive Compensation Plan. This
award is subject to all the terms and conditions set forth
in the 1994 Incentive Compensation Plan as amended which is
hereby incorporated by reference and to all determinations
of the Committee of the Board of Directors which is
authorized to administer the Plan. As a condition of
granting the option herein granted, the Employee agrees, for
himself and his personal representatives, that any
requirement or interpretation, dispute, or disagreement
which may arise under or as a result of or pursuant to this
Agreement or the Plan shall be determined by the Committee
in its sole discretion, and that any interpretation or
determination by the Committee shall be final, binding and
conclusive.
14. Governing Law. This Agreement shall be construed,
administered and governed in all respects in accordance with
the laws of the State of Wisconsin.
IN WITNESS WHEREOF, the Company has caused this option to be
executed on the date first above written.
ATTEST: MODINE MANUFACTURING COMPANY
By:
- ------------------------- ------------------------------------
W. E. Pavlick, Secretary R. T. Savage
President & Chief Executive Officer
Accepted and Agreed To:
-------------------------------------
Employee
EXHIBIT 10(u) continued
MODINE MANUFACTURING COMPANY
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION granted this day of
-------
January, 19 by Modine Manufacturing Company, a Wisconsin
----
corporation (the "Company"), to , (the
-------------------------
"Employee") under and pursuant to the Company's 1994 Incentive
Compensation Plan (the "Plan"), as amended.
WITNESSETH:
WHEREAS, The Committee of the Board of Directors, which is
authorized to administer the Plan (the "Committee"), is of the
opinion that the interests of the Company and its subsidiaries
will be advanced by encouraging and enabling certain key
employees of the Company and its subsidiaries to acquire or
increase their proprietary interest in the Company, thus
providing them with a more direct stake in its welfare and
assuring a closer identification of their interests with those of
the Company; and
WHEREAS, the Committee believes that the acquisition of such
an interest in the Company will stimulate the efforts of such
employees and strengthen their desire to remain with the Company
or one of its subsidiaries;
NOW, THEREFORE, in consideration of the aforementioned, and
the covenants and agreements herein set forth, the Company grants
its option to the Employee on the terms hereinafter expressed:
1. Option Grant. The Company hereby grants to the Employee an
------------
option to purchase a total of shares of Common
-----------
Stock of the Company at the option price of $ per
-----------
share, being at least equal to 100% of the fair market value
of such shares on the date hereof.
2. Time of Exercise. This option may be exercised (in the
----------------
manner provided in paragraph 3 hereof) in whole or in part,
from time to time after the date hereof, subject to the
following limitations:
(a) Except for exercise under paragraph 5 below, this
option may not be exercised for one year from the date
when the Employee's present employment with Modine
first commenced.
(b) If Employee is an officer of the Company subject to
the reporting requirements of Section 16 of the
Securities Exchange Act of 1934, this option may not be
exercised by the Employee for six (6) months from the
date of grant.
(c) Options may be exercised before the option period
terminates without regard to the order of grant.
(d) This option may only be exercised, at any one time,
exclusively in multiples of twenty-five (25) shares
with a one hundred (100) share exercise minimum, except
for the purchase of all shares then remaining subject
to this option.
(e) This option may not be exercised beyond the shorter of:
(i) ten (10) years from the date hereof;
(ii) after an Employee has been terminated for cause
(such as dishonesty or negligence in performance
of Employee's duties). In such event the
employee shall forfeit all unexercised options;
(iii) three (3) years (except as provided in paragraph
5) following termination of employment (if
without cause) or retirement.
In the event this option is not exercised in accordance
with subparagraphs (i), (ii) or (iii) above, it shall
be forfeited as an unexercised option.
3. Exercise of Option. This option may be exercised only by
------------------
appropriate notice in writing delivered to the Secretary of
the Company at 1500 DeKoven Avenue, Racine, Wis. 53403 and
accompanied by:
(a) Check payable to the order of the Company, or Modine
Stock (the value of which shall be the fair market
value of the stock on the day preceding the exercise
date), or a combination of Modine stock and cash, for
the full purchase price of the shares purchased.
4. Nontransferability of Option. This option is not
----------------------------
transferable by the Employee otherwise than (a) by will or
the laws of descent and distribution, or (b) pursuant to a
qualified domestic relations order, and is exercisable,
during the Employee's lifetime, only by the Employee or his
legal representative.
5. Death of Employee. If the Employee dies during the option
-----------------
period, this option may be exercised in whole or in part and
from time to time, in the manner described in paragraph 3
hereof, by the Employee's estate or the person to whom the
option passes by will or the laws of descent and
distribution, but only within a period of (a) one year next
succeeding the Employee's death, or (b) ten years from the
date hereof, whichever period is shorter.
6. Delivery of Certificates. The Company shall issue and
------------------------
deliver certificates for stock purchased pursuant to an
exercise of this option subject to the following
limitations:
(a) The Employee shall have no interest in any such Shares
until certificates for said Shares are issued.
(b) The Company shall not be required to issue or deliver
any certificates for its Common Stock purchased upon
the exercise of this option prior to the admission of
such shares to listing on any stock exchange or any
over-the-counter quotation system on which shares may
at that time be listed. In the event of the exercise
of this option while the option class of stock is not
so listed or admitted, the Company shall make prompt
application for such listing or admission. If any time
during the option period the Company shall be advised
by its counsel that the shares deliverable upon an
exercise of the option are required to be registered
under the Federal Securities Act of 1933 or any state
securities law or that delivery of such shares must be
accompanied or preceded by a prospectus, the Company
will use its best efforts to effect such registration
or provide such prospectus, but delivery of shares by
the Company may be deferred until such registration is
effected or such prospectus is available.
7. Adjustment Provisions. In the event that there is any
---------------------
change in the number of issued shares of Common Stock of the
Company without new consideration to the Company therefor,
by reason of stock dividends, stock split-ups or like
recapitalizations, the number of shares which may thereafter
be purchased under this option shall be adjusted in the same
proportion as said change in issued shares. In such event,
the per share purchase price specified in paragraph 1 above
shall be adjusted so that the total consideration payable to
the Company for the adjusted number of shares remaining
subject to this option shall not be changed by reason of the
adjustment in number of shares.
If during the term of this option the Common Stock of the
Company shall be combined or be changed into the same or
another kind of stock of the Company or into securities of
another corporation, whether through recapitalization,
reorganization, sale, merger, consolidation, or by other
means, the Company shall cause adequate provision to be made
whereby the Employee thereafter will be entitled to receive,
upon the due exercise of any then unexercised portion of
this option, the securities which the Employee would have
been entitled to receive for Common Stock acquired through
exercise of such portion of the option (regardless of
whether or to what extent the option would then have been
exercisable) immediately prior to the effective date of such
recapitalization, reorganization, sale, merger,
consolidation, or similar transaction. If appropriate, due
adjustment shall be made in the per share or per unit price
to the securities purchased on exercise of this option
following said recapitalization, sale, merger,
consolidation, or similar transaction.
8. Effect on Other Benefits. Neither this option, shares of
------------------------
stock issued upon its exercise, any excess of market value
over option price, nor any other rights, benefits, values or
interests resulting from the granting of this option shall
be considered as compensation for purposes of any pension,
profit sharing, retirement plan, insurance plan, investment
or stock purchase plan, or any other employee benefit plan
of the Company or any of its subsidiaries.
9. Fair Market Value. For purposes hereof, "fair market value"
-----------------
shall equal the closing market price on the largest stock
exchange or over-the-counter quotation system on which
Modine Common Stock is traded on the date a determination is
required to be made under the Plan or this Agreement, or if
no stock is traded on that day then it shall equal the
closing market price on the last preceding day on which such
stock was traded on said exchange or system.
10. Employee Not Deemed to be a Shareholder. The Employee
---------------------------------------
shall not be deemed to be a shareholder of the Company for
any purposes with respect to any option granted hereunder
except to the extent that such option shall have been
exercised and a stock certificate issued therefor.
11. No Right to Continued Employment. Nothing in this Agreement
--------------------------------
or the Plan shall confer upon Employee any right to continue
in the employment of the Company or in any way effect the
right of the Company to terminate Employee's employment at
any time.
12. Cancellation and Rescission of Stock Option. The Committee
-------------------------------------------
may cancel this option at any time if Employee is not in
compliance with all other applicable provisions of this
option, the Plan, and with the following conditions:
(a) Employee shall not render services for any organization
or engage directly or indirectly in any business which,
in the judgment of the Committee, is or becomes
competitive with the Company, or which organization or
business, or the rendering of services to such
organization or business, is or becomes otherwise
prejudicial to or in conflict with the interests of the
Company;
(b) Employee shall comply fully with applicable laws and
government regulations and maintain high ethical
standards. Employee shall also comply with the
Company's corporate policies, including, but not
limited to, Policy No. G-2, Guideline for Business
Conduct, and Policy No. G-3, Antitrust Compliance, and
the Company's Agreement for Assignment of Inventions.
If Employee's employment has terminated, the judgment of the
Committee shall be based on Employee's position and
responsibilities while employed by the Company, Employee's
post-employment responsibilities and position with the other
organization or business, the extent of past, current and
potential competition or conflict between the Company and
the other organization or business, the effect on the
Company's customers, suppliers and competitors of Employee's
assuming the post-employment position, and such other
considerations as are deemed relevant given the applicable
facts and circumstances. If Employee retires, he shall be
free, however, to purchase as an investment or otherwise,
stock or other securities of such organization or business
so long as they are listed upon a recognized securities
exchange or traded over-the-counter, and such investment
does not represent a substantial investment to Employee or a
greater than 10 percent equity interest in the organization
or business.
Failure to comply with the provisions of paragraph (a) or
(b) of this Paragraph 12 prior to, or during the twenty-four
(24) months after, any exercise pursuant to this option
shall cause such exercise to be rescinded. The Company
shall notify Employee in writing of any such rescission
within twenty-four (24) months after such exercise. Within
ten days after receiving such a notice from the Company,
Employee shall pay to the Company the amount of any gain
realized or payment received pertaining to the rescinded
exercise of this option. Such payment shall be made either
in cash or by returning to the Company the number of shares
of Common Stock that Employee received in connection with
the rescinded exercise.
13. Grant Subject to 1994 Incentive Compensation Plan. This
-------------------------------------------------
award is subject to all the terms and conditions set forth
in the 1994 Incentive Compensation Plan which is hereby
incorporated by reference and to all determinations of the
Committee of the Board of Directors which is authorized to
administer the Plan. As a condition of granting the option
herein granted, the Employee agrees, for himself and his
personal representatives, that any requirement or
interpretation, dispute, or disagreement which may arise
under or as a result of or pursuant to this Agreement or the
Plan shall be determined by the Committee in its sole
discretion, and that any interpretation or determination by
the Committee shall be final, binding and conclusive.
14. Governing Law. This Agreement shall be construed,
-------------
administered and governed in all respects in accordance with
the laws of the State of Wisconsin.
IN WITNESS WHEREOF, the Company has caused this option to be
executed on the date first above written.
ATTEST: MODINE MANUFACTURING COMPANY
By:
- ----------------------------- ---------------------------
W. E. Pavlick, Secretary R. T. Savage, President and
Chief Executive Officer
Accepted and Agreed To:
---------------------------------
Employee
EXHIBIT 10(v)
MODINE MANUFACTURING COMPANY
----------------------------
DIRECTOR'S STOCK OPTION AGREEMENT
---------------------------------
THIS DIRECTOR'S STOCK OPTION granted this day of
--------- -----------,
199 , by Modine Manufacturing Company, a Wisconsin corporation (the
---
"Company"), to (the "Director") under and pursuant to
------------------
the Company's 1994 Stock Option Plan For Non-Employee Directors (the
"Directors' Plan").
WITNESSETH:
WHEREAS, the Board of Directors is of the opinion that the
interests of the Company will be advanced by encouraging and
enabling the non-employee directors of the Company to acquire or
increase their proprietary interest in the Company; and
WHEREAS, the Board of Directors believes that the
acquisition of such an interest will assist the Company in its
efforts to attract and retain well qualified individuals to serve
as its directors;
NOW, THEREFORE, in consideration of the aforementioned, and
the covenants and agreements herein set forth, the Company grants
this option to the Director on the terms hereinafter expressed:
1. Option Grant. The Company hereby grants to the Director an
------------
option to purchase a total of shares of Common
-------------
Stock of the Company at the option price of $
----------
per share, being at least equal to 100% of the fair market
value of such shares on the date hereof.
2. Time of Exercise. This option may be exercised (in the
----------------
manner provided in paragraph 3 hereof) in whole or in part,
from time to time after the date hereof; provided, however,
that this option may not be exercised beyond the shorter of:
(a) ten (10) years from the date hereof;
(b) after the Director has been removed for cause, in which
event the Director shall forfeit all unexercised options;
(c) except as provided in paragraphs 2(d) or 5, after
expiration of 90 days following the Director's
resignation from the Board of Directors or failure to
be re-elected to the Board of Directors by the
shareholders,; or
(d) after expiration of 3 years following the
Director's retirement pursuant to the Company's
Director Emeritus Retirement Plan;
after such period the Director shall forfeit all unexercised options.
Pursuant to Section 16 of the Securities Exchange Act of
1934, stock subject to the exercise of this option may not
be sold by the Director for six (6) months from the date of
grant.
3. Exercise of Option. This option may be exercised only by
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appropriate notice in writing delivered to the Secretary of
the Company at 1500 DeKoven Avenue, Racine, Wis. 53403, and
accompanied by:
(a) Check payable to the order of the Company, or
Modine stock (the value of which shall be the fair
market value of the stock on the day preceding the
exercise date), or a combination of Modine stock and
cash, for the full purchase price of the shares
purchased; and
(b) Written representation by the Director that at the
time of such exercise it is the Director's intention to
acquire the shares for investment and not for resale.
Such written representation shall not be required of
the purchaser under paragraph 5 below.
4. Nontransferability of Option. This option is not transferable
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by the Director otherwise than (a) by will or the laws of descent
and distribution, or (b) pursuant to a qualified domestic relations
order. This option is exercisable during the Director's lifetime
only by the Director.
5. Death of Director. If the Director dies during the option
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period, this option may be exercised in whole or in part in
the manner described in paragraph 3 hereof, by the
Director's estate or the person to whom the option passes by
will or the laws of descent and distribution, but only
within a period of one year next succeeding the Director's
death.
6. Delivery of Certificates. The Company shall issue and
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deliver certificates for stock purchased pursuant to an
exercise of this option subject to the following
limitations:
(a) The Director shall have no interest in any such
Shares until certificates for said Shares are issued.
(b) The Company shall not be required to issue or
deliver any certificate for its Common Stock purchased
upon the exercise of this option prior to the admission
of such shares to listing on any stock exchange or any
over-the-counter quotation system on which shares may
at that time be listed. In the event of the exercise
of this option while the option class of stock is not
so listed or admitted, the Company shall make prompt
application for such listing or admission. If any time
during the option period the Company shall be advised
by its counsel that the shares deliverable upon an
exercise of the option are required to be registered
under the Federal Securities Act of 1933 or any state
securities law or that delivery of such shares must be
accompanied or preceded by a prospectus, the Company
will use its best efforts to effect such registration
or provide such prospectus, but delivery of shares by
the Company may be deferred until such registration is
effected or such prospectus is available.
7. Adjustment Provisions. In the event that there is any
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change in the number of issued shares of Common Stock of the
Company without new consideration to the Company therefor,
by reason of stock dividends, stock split-ups or like
recapitalizations, the number of shares which may thereafter
be purchased under this option shall be adjusted in the same
proportion as said change in issued shares. In such event,
the per share purchase price specified in paragraph 1 above
shall be adjusted so that the total consideration payable to
the Company for the adjusted number of shares remaining
subject to this option shall not be changed by reason of the
adjustment in number of shares.
If during the term of this option the Common Stock of the
Company shall be combined or be changed into the same or
another kind of stock of the Company or into securities of
another corporation, whether through recapitalization,
reorganization, sale, merger, consolidation, etc., the
Company shall cause adequate provision to be made whereby
the Director thereafter will be entitled to receive, upon
the due exercise of any then unexercised portion of this
option, the securities which the Director would have been
entitled to receive for Common Stock acquired through
exercise of such portion of the option (regardless of
whether or to what extent the option would then have been
exercisable) immediately prior to the effective date of such
recapitalization, reorganization, sale, merger,
consolidation, etc. If appropriate, due adjustment shall be
made in the per share or per unit price of the securities
purchased on exercise of this option following said
recapitalization, reorganization, sale, merger,
consolidation, etc.
8. Fair Market Value. For purposes hereof, "fair market value"
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shall equal the closing market price on the largest stock
exchange or the over the counter quotation system on which
Modine Common Stock is traded on the date a determination is
required to be made under the Directors' Plan or this
Agreement, or if no stock is traded on that day then it
shall equal the closing market price on the last preceding
day on which such stock was traded on said exchange or
system.
9. Tenure. Nothing in this Agreement or the Directors' Plan
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shall confer upon the Director any right to continue to
serve as a Director of the Company or in any way effect the
right of the Company to take any action against a Director
pursuant to law and/or the Company's Articles of
Incorporation or By-Laws.
10. Grant Subject to 1985 1994 Stock Option Plan for Non-
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Employee Directors. This grant is subject to all the terms
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and conditions set forth in the 1994 Stock Option Plan for
Non-Employee Directors which is hereby incorporated by
reference including the requirement of shareholder approval
and to all determinations of the Committee which is authorized
to administer the Directors' Plan. As a condition of granting
the option herein granted, the Director agrees, for himself and
his personal representatives, that any requirement or interpretation,
dispute, or disagreement which may arise under or as a result of or
pursuant to this Agreement or the Directors' Plan shall be determined
by the Committee in its sole discretion, and that any interpretation or
determination by the Committee shall be final, binding and conclusive.
11. Governing Law. This Agreement shall be construed, administered
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and governed in all respects in accordance with the laws of the
State of Wisconsin.
IN WITNESS WHEREOF, the Company has caused this option to be
executed on the date first above written.
ATTEST: MODINE MANUFACTURING COMPANY
BY:
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W. E. Pavlick, Secretary R. T. Savage, President and
Chief Executive Officer
Accepted and Agreed To:
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Director