Registration No. 333-_________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ARVIN INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
INDIANA 35-0550190
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification number)
ONE NOBLITT PLAZA
BOX 3000
COLUMBUS, INDIANA 47202-3000
(812) 379-3000
(ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICE)
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Ronald R. Snyder
Vice President, General Counsel and Secretary
Arvin Industries, Inc.
One Noblitt Plaza
Box 3000
Columbus, Indiana 47202-3000
(812) 379-3000
(Name, address, including zip code and telephone number,
including area code, of agent for service)
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COPY TO:
FREDERICK L. HARTMANN
SCHIFF HARDIN & WAITE
6600 SEARS TOWER
CHICAGO, ILLINOIS 60606
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: FROM
TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
If the only securities being registered on the Form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. [X ]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for
the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Amount Maximum Maximum
Title of Each Class of to be Offering Price Aggregate Amount of
Securities to be Registered Registered<1> Per Unit<2> Offering Price<2> Registration Fee
Debt Securities<4> . . . . . . .
Preferred Shares, without
par value <5><6> . . . . . . . .
Depositary Shares<6> . . . . . . <3> <3> <3>
Common Shares, $2.50 par value,
and related Preferred Share
Purchase Rights<7> . . . . . . .
Share Purchase Contracts<7> . . .
Share Purchase Units<7> . . . . .
Warrants<8> . . . . . . . . . .
TOTAL $400,000,000<1> _________ $400,000,000<2> $111,200
<1> In no event will the initial offering price of all securities issued from time to time pursuant to this
Registration Statement exceed $400,000,000 (or the equivalent, based on the applicable exchange rate at the
time of sale, thereof in other currency or currency units if any securities are denominated in, or sold for,
other than U.S. dollars). Any securities registered hereunder may be sold separately or as units with other
securities registered hereunder.
<2> Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o).
<3> Not applicable pursuant to Form S-3, General Instruction II.D.
<4> Subject to note (1), there are being registered hereunder an indeterminate principal amount of Debt
Securities. See "Description of the Debt Securities." If any Debt Securities are being issued at an
original issue discount, then the offering shall be in such greater principal amount as shall result in an
approximate initial offering price not to exceed $400,000,000, less the amount of any securities previously
issued hereunder. There are also being registered hereunder an indeterminate number of Debt Securities as
shall be issuable upon conversion of subordinated Debt Securities or Preferred Shares registered hereby.
<5> Subject to note (1), there are being registered hereunder an indeterminate number of Preferred Shares as may
be sold, from time to time, by the Registrant. See "Description of Capital Shares -- Preferred Shares."
There are also being registered hereunder an indeterminate number of Preferred Shares as shall be issuable
upon conversion of subordinated Debt Securities or Preferred Shares registered hereby.
<6> Subject to note (1), there are being registered hereunder an indeterminate number of Depositary Shares to be
evidenced by Depositary Receipts issued pursuant to a Deposit Agreement. See "Description of Depositary
Shares." In the event the Registrant elects to offer to the public fractional interests in Preferred Shares
registered hereunder, the Preferred Shares may be issued to the depositary under a Deposit Agreement, and
Depositary Receipts will be issued by the depositary.
<7> Subject to note (1), there are being registered hereunder an indeterminate number of Common Shares and
related Preferred Share Purchase Rights as may be sold, from time to time, by the Registrant. The aggregate
amount of Common Shares registered is further limited to that which is permissible under Rule 415(a)(4) under
the Securities Act. Prior to the occurrence of certain events, the Rights will not be exercisable or
evidenced separately from the Common Shares. See "Description of Capital Shares -- Common Shares" and "--
Preferred Share Purchase Rights." There are also being registered hereunder an indeterminate number of
Common Shares and related Preferred Share Purchase Rights as shall be issuable upon conversion of
subordinated Debt Securities or Preferred Shares registered hereby. There are being registered hereunder an
indeterminate number of Common Shares as may be issued, from time to time, by the Registrant upon settlement
of the Share Purchase Contracts or Share Purchase Units. See "Description of Share Purchase Contracts and
Share Purchase Units."
<8> Subject to note (1), there are being registered hereunder an indeterminate amount and number of Warrants,
representing rights to purchase Preferred Shares, Common Shares or Debt Securities registered hereby.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO
DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY
STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION
8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH
DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
/TABLE
SUBJECT TO COMPLETION MAY 7, 1999
PROSPECTUS
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[ARVIN LOGO]
ARVIN INDUSTRIES, INC.
$400,000,000
DEBT SECURITIES
PREFERRED SHARES
DEPOSITARY SHARES
COMMON SHARES
SHARE PURCHASE CONTRACTS
SHARE PURCHASE UNITS
WARRANTS
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WE WILL PROVIDE SPECIFIC TERMS OF THESE SECURITIES IN SUPPLEMENTS TO
THIS PROSPECTUS.
You should read this prospectus and any supplement carefully before
you invest.
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THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAVE THESE
ORGANIZATIONS DETERMINED THAT THIS PROSPECTUS IS ACCURATE OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is _________________, 1999.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS
EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES
AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE
WHERE THE OFFER OR SALE IS NOT PERMITTED.
TABLE OF CONTENTS
Page
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SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
THE SECURITIES WE MAY OFFER . . . . . . . . . . . . . . . . 1
DEBT SECURITIES . . . . . . . . . . . . . . . . . . . . . . 1
PREFERRED SHARES AND DEPOSITARY SHARES . . . . . . . . . . . 2
COMMON SHARES . . . . . . . . . . . . . . . . . . . . . . . 3
SHARE PURCHASE CONTRACTS AND SHARE PURCHASE UNITS . . . . . 3
WARRANTS . . . . . . . . . . . . . . . . . . . . . . . . . . 3
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED SHARE DIVIDENDS . . . . . . 3
WHERE YOU CAN FIND MORE INFORMATION . . . . . . . . . . . . . . . 4
ARVIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . 5
DESCRIPTION OF THE DEBT SECURITIES . . . . . . . . . . . . . . . 5
PROVISIONS APPLICABLE TO BOTH SENIOR AND SUBORDINATED DEBT
SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . 5
GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . 5
REGISTRATION, TRANSFER AND EXCHANGE . . . . . . . . . . . . 7
CONSOLIDATION, MERGER AND SALE OF ASSETS . . . . . . . . . . 7
MODIFICATION AND WAIVER . . . . . . . . . . . . . . . . . . 7
SATISFACTION AND DISCHARGE OF AN INDENTURE . . . . . . . . . 8
EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . 9
BOOK-ENTRY DEBT SECURITIES . . . . . . . . . . . . . . . . . 10
YEAR 2000 COMPLIANCE . . . . . . . . . . . . . . . . . . . . 14
INFORMATION CONCERNING THE TRUSTEE . . . . . . . . . . . . . 15
GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . 15
PROVISIONS APPLICABLE SOLELY TO SENIOR DEBT SECURITIES . . . . . 15
COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . 15
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . 18
PROVISIONS APPLICABLE SOLELY TO SUBORDINATED DEBT SECURITIES . . 20
SUBORDINATION . . . . . . . . . . . . . . . . . . . . . . . 20
CONVERSION . . . . . . . . . . . . . . . . . . . . . . . . . 21
DESCRIPTION OF CAPITAL SHARES . . . . . . . . . . . . . . . . . . 23
GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . 23
COMMON SHARES . . . . . . . . . . . . . . . . . . . . . . . 23
PROVISIONS WITH POSSIBLE ANTI-TAKEOVER EFFECTS . . . . . . . 24
PREFERRED SHARE PURCHASE RIGHTS . . . . . . . . . . . . . . 26
PREFERRED SHARES . . . . . . . . . . . . . . . . . . . . . . 27
DESCRIPTION OF SHARE PURCHASE CONTRACTS AND SHARE PURCHASE UNITS 29
DESCRIPTION OF DEPOSITARY SHARES . . . . . . . . . . . . . . . . 29
GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . 29
DIVIDENDS AND OTHER DISTRIBUTIONS . . . . . . . . . . . . . 30
REDEMPTION OF DEPOSITARY SHARES . . . . . . . . . . . . . . 30
VOTING THE PREFERRED SHARES . . . . . . . . . . . . . . . . 31
AMENDMENT AND TERMINATION OF DEPOSITARY AGREEMENT . . . . . 31
CHANGES OF DEPOSITARY . . . . . . . . . . . . . . . . . . . 31
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . 32
DESCRIPTION OF WARRANTS . . . . . . . . . . . . . . . . . . . . . 32
DEBT WARRANTS . . . . . . . . . . . . . . . . . . . . . . . 32
EQUITY WARRANTS . . . . . . . . . . . . . . . . . . . . . . 33
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . 34
LEGAL OPINIONS . . . . . . . . . . . . . . . . . . . . . . . . . 35
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SUMMARY
This summary highlights selected information from this document
and does not contain all of the information that is important to you.
To understand the terms of our securities, you should carefully read
this document with the attached prospectus supplement. Together, these
documents will give the specific terms of the securities we are
offering. You should also read the documents we have incorporated by
reference into this prospectus for information about us and our
financial statements.
THE SECURITIES WE MAY OFFER
This prospectus is part of a registration statement that we filed
with the SEC utilizing a "shelf" registration process. Under this
shelf registration, we may offer from time to time up to $400,000,000
of any of the following securities, either separately or in units:
debt securities, preferred shares, depositary shares, common shares,
share purchase contracts relating to the common shares, share purchase
units, and warrants. This prospectus provides you with a general
description of the securities we may offer. Each time we offer
securities, we will provide you with a prospectus supplement that will
describe the specific amounts, prices and terms of the securities
being offered. The prospectus supplement may also add, update or
change information contained in this prospectus.
DEBT SECURITIES
We may offer unsecured general obligations of Arvin, which may be
senior or subordinate. In this prospectus, we refer to the senior debt
securities and the subordinated debt securities together as the "debt
securities." The senior debt securities will have the same rank as all
of our other unsecured and unsubordinated debt. The subordinated debt
securities will be entitled to payment only after payment on our
senior indebtedness. Senior indebtedness includes all indebtedness for
money borrowed by Arvin, except indebtedness that by its terms is not
superior to, or has the same rank as, the subordinated debt
securities.
The senior debt securities will be issued under an indenture
between us and Harris Trust and Savings Bank as the trustee. The
subordinated debt securities will be issued under an indenture between
us and the trustee we name in a prospectus supplement. We have
summarized general features of the debt securities from the
indentures. We encourage you to read the indentures which are exhibits
to the registration statement and our recent periodic and current
reports filed with the SEC.
SENIOR AND SUBORDINATED DEBT SECURITIES. The indentures do not
limit the amount of debt that we may issue. The indentures do not
provide holders any protection in the event of a recapitalization or
restructuring involving Arvin. Also, neither indenture provides
holders with any special protection in the event of a highly leveraged
transaction.
The indentures allow us to merge or consolidate with another
company, or to sell all or most of our assets to another company. If
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these events occur, the other company will be required to assume all
our responsibilities relating to the debt securities.
The indentures provide that holders of a majority of the
outstanding principal amount of any series of debt securities may vote
to change our obligations or your rights concerning that series.
However, to change the amount or timing of principal, interest or
other payments under the debt securities, every holder in the series
must consent.
We may discharge our obligations under the indentures by
depositing with the trustee sufficient funds or government obligations
to pay the debt securities when due.
EVENTS OF DEFAULT. Each indenture provides that the following
are events of default:
- If we do not pay interest for 30 days after its due date.
- If we do not pay principal or any premium when due.
- If we do not make any sinking fund payment when due.
- If we continue to breach a covenant or warranty for 90 days
after notice.
- If we fail to pay principal or interest on other significant
indebtedness of Arvin when due.
- If we enter bankruptcy, become insolvent or reorganize.
Upon the bankruptcy, insolvency, or reorganization of Arvin, all
unpaid principal, accrued interest and any premium on any series of
outstanding debt securities will become immediately payable without
any declaration or act of the trustee or the holders. If any other
event of default occurs with respect to any series of debt securities,
the trustee or holders of at least 25% of the outstanding principal
amount of that series may declare the principal amount of the series
immediately payable. However, holders of a majority of the principal
amount may rescind this action.
SENIOR DEBT SECURITIES. The indenture relating to the senior
debt securities contains covenants restricting our ability to incur
secured indebtedness, to enter into sale and leaseback transactions
and to transfer assets to some of our subsidiaries.
SUBORDINATED DEBT SECURITIES. All payments on the subordinated
debt securities are subordinated in right of payment to the prior
payment in full of all senior indebtedness.
PREFERRED SHARES AND DEPOSITARY SHARES
We may issue our preferred shares, no par value, in one or more
series. Our board of directors will determine the dividend, voting,
conversion and other rights of the series of preferred shares being
offered. We may also issue fractional shares of the preferred shares
that will be represented by depositary shares and depositary receipts.
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COMMON SHARES
We may issue our common shares, par value $2.50 per share.
Holders of common shares are entitled to receive dividends when
declared by the board of directors, subject to the rights of holders
of preferred shares. Each holder of common shares is entitled to one
vote per share. The holders of common shares have no preemptive rights
or cumulative voting rights.
SHARE PURCHASE CONTRACTS AND SHARE PURCHASE UNITS
We may issue share purchase contracts for the purchase of our
common shares. We also may issue share purchase units, each of which
will consist of a share purchase contract and a debt security or a
debt obligation of a third party, including a U.S. Treasury security.
The debt security or debt obligation of a third party may be pledged
as collateral to secure the holder's obligation to purchase common
shares under the share purchase contract. Our board of directors will
determine the terms of the offering, including the terms of the share
purchase contracts and information about the security or obligation
that will secure the holder's obligation to purchase common shares.
WARRANTS
We may issue warrants for the purchase of debt securities,
preferred shares, depositary shares or common shares. We may issue
warrants independently or together with other securities.
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED SHARE DIVIDENDS
Our ratio of earnings to fixed charges and our ratio of earnings
to combined fixed charges and preferred share dividends for each of
the periods indicated are as follows:
FISCAL YEAR ENDED
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JAN. 3, DEC. 28, DEC. 29, DEC. 31, JAN. 1,
1999 1997 1996 1995 1995
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Ratio of Earnings to Fixed Charges.................... 3.7 3.2 2.4 1.6 1.8
Ratio of Earnings to Combined Fixed Charges and
Preferred Dividends................................ 3.7 3.2 2.4 1.6 1.8
For purposes of calculating the ratios, earnings consist of
earnings from continuing operations before income taxes, adjusted for
the portion of fixed charges deducted from these earnings. Fixed
charges consist of interest on all indebtedness, including capital
lease obligations and capitalized interest, amortization of debt
expense and the percentage of rental expense on operating leases
deemed representative of the interest factor. The ratio of earnings to
fixed charges, before the restructuring and special charges, for 1995
was 1.9 and for 1994 was 2.4. No preferred shares were outstanding
during the periods, and no preferred dividends were paid.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements
and other information with the SEC. You may read and copy any document
we file at the SEC's public reference rooms in Washington, D.C., New
York, New York and Chicago, Illinois. Please call the SEC at (800)SEC-
0330 for further information on the public reference rooms. Our SEC
filings are also available to the public at the SEC's web site at
http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this
prospectus the information we file with it, which means that we can
disclose important information to you by referring you to those
documents. The information incorporated by reference is considered to
be part of this prospectus, and later information that we file with
the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future
filings made with the SEC under section 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 until our offering is completed:
(1) Arvin's Annual Report on Form 10-K for the fiscal year ended
January 3, 1999;
(2) Arvin's Current Reports on Form 8-K dated March 4, 1999 and
March 12, 1999; and
(3) The description of the common shares contained in Arvin's
registration statement on Form 8-A, filed June 19, 1950,
supplementing Arvin's registration statement on Form 10,
filed October 25, 1939, and the description of the
associated preferred share purchase rights contained in
Arvin's registration statement on Form 8-A, dated June 10,
1986, as amended February 28, 1989, December 9, 1994 and May
10, 1996, in each case as filed under section 12 of the
Securities Exchange Act.
You may request a copy of these filings at no cost, by writing to
or telephoning us at the following address and telephone number:
Arvin Industries, Inc., Shareholder Relations, One Noblitt Plaza, Box
3000, Columbus, Indiana 47202-3000 and (812)379-3000.
You should rely only on the information incorporated by reference
or provided in this prospectus or any prospectus supplement. We have
not authorized anyone else to provide you with different information.
We are not making an offer of these securities in any state where the
offer is not permitted. You should not assume that the information in
this prospectus or any prospectus supplement is accurate as of any
date other than the date on the front of the document.
ARVIN
We are a focused international manufacturer and supplier of
automotive parts with more than 50 manufacturing facilities and eight
technical centers located in 21 countries. We are a worldwide leader
in automotive exhaust systems and ride control products for the
original equipment and replacement markets. Through our acquisition
of the Purolator Products automotive filter business, we are also a
North American leader in the automotive filter market. Since our
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founding in 1919, we have grown through internal development,
acquisitions and international joint ventures. In recent years, our
strategy has been to strengthen our automotive parts businesses by
achieving a mix of sales to both original equipment manufacturers and
replacement market parts suppliers on a global basis.
We were incorporated in Indiana in 1921. Our principal executive
offices are located at One Noblitt Plaza, Box 3000, Columbus, Indiana
47202-3000, and our telephone number is (812) 379-3000. Our common
shares are listed on the New York Stock Exchange and the Chicago Stock
Exchange under the symbol "ARV."
USE OF PROCEEDS
Unless otherwise specified in the applicable prospectus
supplement, the net proceeds we receive from the sale of the
securities offered by this prospectus and the attached prospectus
supplement will be used for general corporate purposes. General
corporate purposes may include the repayment of debt, working capital
expenditures and acquisitions or investments in businesses and assets.
The net proceeds may be invested temporarily or applied to repay
short-term debt until they are used for their stated purpose.
DESCRIPTION OF THE DEBT SECURITIES
The following description of the debt securities sets forth
general terms that may apply to the debt securities. The particular
terms of any debt securities will be described in a prospectus
supplement relating to those debt securities.
The debt securities will be either our senior debt securities or
our subordinated debt securities. The senior debt securities will be
issued under an indenture dated as of July 3, 1990, and supplemented
on March 31, 1994, between us and Harris Trust and Savings Bank as the
trustee. This indenture is referred to as the "senior indenture." The
subordinated debt securities will be issued under an indenture to be
entered into between us and a trustee named in the prospectus
supplement. This indenture is referred to as the "subordinated
indenture." The senior indenture and the subordinated indenture are
together called the "indentures."
The following is a summary of important provisions of the
indentures. Copies of the entire indentures are exhibits to the
registration statement of which this prospectus is a part. Section
references below are to the section in the applicable indenture. The
referenced sections of the indentures are incorporated by reference.
PROVISIONS APPLICABLE TO BOTH SENIOR AND SUBORDINATED DEBT SECURITIES
GENERAL
Neither indenture limits the total principal amount of debt
securities that we may issue. Each indenture provides that we may
issue debt securities in one or more series from time to time up to
the total principal amount that we have authorized. The senior debt
securities will be unsecured and will have the same rank as all of our
other unsecured and unsubordinated debt. The subordinated debt
securities will be unsecured and will be subordinated and junior to
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all of our senior indebtedness. Neither indenture limits the amount
of other unsecured indebtedness or securities that we may issue.
The debt securities may be issued in one or more separate series
of senior debt securities or subordinated debt securities. The
prospectus supplement relating to the particular series of debt
securities being offered will specify the particular amounts, prices
and terms of those debt securities. These terms may include:
- the title of the debt securities;
- the series of the debt securities;
- their total principal amount and denominations;
- the date or dates on which they will mature;
- their interest rate or rates, or the method of determining
those rates;
- their interest payment dates and the record dates for
interest payments;
- any premium payments, including any conditions;
- the manner of making principal, interest and any premium
payments on the debt securities;
- the places where principal, interest and any premium
payments may be made;
- the currency or currencies in which payments on the debt
securities will be payable, if other than U.S. dollars;
- the ranking of the debt securities as senior or
subordinated;
- any mandatory or optional redemption provisions;
- any sinking fund provisions;
- any conversion provisions, in the case of subordinated debt
securities;
- any additional information about book-entry procedures;
- the portion of the principal amount of any debt security
payable upon the acceleration of maturity, if other than the
full principal amount;
- the method of determining the amount of any payments on the
debt securities which are linked to an index;
- whether the debt securities will be issued in fully
registered form without coupons or in bearer form, with or
without coupons, or both, and whether they will be issued in
global form; and
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- any other specific terms of the debt securities.
Principal, interest and any premium will be payable in the
manner, at the places and subject to the restrictions provided in the
applicable indenture. Unless otherwise specified in the prospectus
supplement, payment of any interest may be made at our option by check
mailed to the holders of the registered debt securities at their
registered addresses.
The indentures permit us to issue debt securities with terms
different from those previously issued and to "reopen" a previous
issue and issue additional debt securities of that series.
REGISTRATION, TRANSFER AND EXCHANGE
The debt securities will be issued in fully registered form
without coupons, unless the prospectus supplement contains provisions
relating to bearer securities. The applicable indenture, debt
securities and prospectus supplement will describe the manner in which
and the places where the debt securities may be registered for
transfer or exchanged. No service charge will be payable upon the
registration of transfer or exchange of debt securities, except for
any applicable tax or governmental charge.
CONSOLIDATION, MERGER AND SALE OF ASSETS
We may consolidate with, or sell, lease or convey all or most of
our assets to, or merge with or into, any other corporation, as long
as:
- if we are not the continuing corporation, the successor
corporation is organized and existing under U.S. or state
law;
- the successor corporation by supplemental indenture
expressly assumes the payments on the debt securities and
duly and punctually performs and observes all covenants and
conditions of the applicable indenture to be performed by
us; and
- we or the successor corporation are not in default in the
performance of any of those covenants or conditions
immediately after the merger or consolidation or the sale,
lease or conveyance.
MODIFICATION AND WAIVER
Arvin and the applicable trustee may modify and amend either
indenture with the consent of the holders of at least a majority in
total principal amount of the outstanding debt securities of each
affected series. However, no modification or amendment may, without
the consent of the holder of each affected outstanding debt security:
- change the stated maturity of the principal or any interest;
- reduce the principal amount, the interest rate or any
premium upon redemption;
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- reduce the principal amount of an original issue discount
debt security that would be due and payable upon
acceleration of its maturity;
- change the currency in which any debt security or interest
or any premium on the debt security is payable;
- impair the right to enforce any payment on or after its
stated maturity or the redemption or repayment date;
- in the case of subordinated debt securities, adversely
modify any subordination provision;
- reduce the percentage in principal amount of any series of
outstanding debt securities whose holders' consent is
required for any amendment or waiver; or
- modify any of the provisions described in this paragraph,
except to increase any percentage or to provide that other
provisions of the indenture cannot be modified or waived
without the consent of the holder of each affected
outstanding debt security. (Section 902)
Except for these matters, the holders of at least a majority in
principal amount of any series of outstanding debt securities may
waive past defaults, other than defaults in payment of principal,
interest or any premium, under and waive compliance by us with
provisions of the applicable indenture. (Sections 513 and 1009)
SATISFACTION AND DISCHARGE OF AN INDENTURE
If we deposit or cause to be deposited with the trustee cash or
direct obligations of the United States or obligations guaranteed by
the United States that are sufficient, together with any income that
accrues on those obligations, to pay and discharge the entire
indebtedness on all outstanding debt securities of any series when due
in compliance with the indenture, then we will be treated as having
paid and discharged the entire indebtedness, except for any surviving
obligations, including the rights of holders to be paid amounts when
due under the debt securities.
If we make these deposits with the trustee and either:
- all debt securities authenticated and delivered under the
applicable indenture are delivered for cancellation, other
than:
(1) debt securities that have been destroyed, lost or
stolen and which have been paid or replaced,
(2) coupons pertaining to bearer securities whose surrender
is not required or has been waived, and
(3) debt securities for which we deposited or segregated
and held in trust payment and which later was repaid to
us or discharged from the trust, or
8
- all debt securities are or will become due and payable at
their stated maturity within one year or will be called for
redemption within one year if redeemable at our option,
and we comply with any other conditions, the indenture will be of no
further effect, except for transfer or exchange rights. (Section 401)
EVENTS OF DEFAULT
Each indenture provides that the following are events of default
with respect to any series of debt securities:
- failure for 30 days to pay interest when due;
- failure to pay principal or any premium when due;
- failure to deposit any sinking fund payment when due;
- if we continue to breach a covenant or warranty in the
indenture for 90 days after appropriate notice;
- failure to pay principal of or interest on any other
obligation for borrowed money of Arvin, including default
under any other series of debt securities and, in the case
of the senior debt securities, including default on any
guaranty of an obligation for borrowed money of a restricted
subsidiary, beyond any grace period if:
(1) the total principal amount exceeds $10,000,000,
(2) we do not contest in appropriate proceedings default in
payment, and
(3) the default in payment has not been cured or waived
before written notice was given to us;
- events of bankruptcy, insolvency or reorganization; or
- any other event of default with respect to that series of
debt securities. (Section 501)
In the case of bankruptcy, insolvency or reorganization, all
unpaid principal of and any premium and accrued interest on any series
of outstanding debt securities will become and be immediately due and
payable without any declaration or other act of the trustee or any
holder. If any other event of default occurs and continues, the
trustee or the holders of at least 25% in total principal amount of
that series of outstanding debt securities may declare the principal
to be due and payable immediately. However, after this declaration of
acceleration has been made, but before a judgment or decree based on
the acceleration has been obtained, the holders of a majority in total
principal amount of that series of outstanding debt securities may
rescind the acceleration if all events of default other than the non-
payment of accelerated principal have been cured or waived.
The prospectus supplement relating to any original issue discount
debt security will contain provisions about acceleration of the
9
maturity of a portion of the principal amount upon the occurrence and
the continuation of an event of default.
Each indenture requires us to file annually with the trustee an
officer's certificate as to the absence of defaults under the
indenture. Each indenture requires the trustee, within 90 days after
the occurrence of a default with respect to any series of outstanding
debt securities which is continuing, to give to the holders notice of
all uncured defaults known to it. However, except in the case of
default in the payment of principal, interest or any premium or in the
payment of any sinking fund installment, the trustee will be protected
in withholding the notice if it in good faith determines that this
withholding of notice is in the interest of the holders of the debt
securities. (Section 602)
Each indenture provides that the trustee will be under no
obligation to exercise any of its rights or powers at the request or
direction of the holders of the debt securities unless they have
offered to the trustee reasonable indemnity. (Section 603) Each
indenture provides that the holders of a majority in total principal
amount of any series of outstanding debt securities will have the
right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee or exercising any
trust or power conferred on the trustee with respect to that series of
debt securities. (Section 601)
No holder of any series of debt security will have any right to
institute any legal proceeding with respect to or for any remedy under
the indenture unless:
- the holder has previously given written notice to the
trustee of a continuing event of default with respect to
that series of debt securities;
- the holders of at least 25% in total principal amount of
that series of outstanding debt securities have made a
written request to the trustee to institute the proceeding;
- the holder or holders have offered the trustee reasonable
indemnity;
- the trustee has failed to institute the proceeding within 60
days; and
- the trustee has not received a direction inconsistent with
the written request from the holders of a majority in total
principal amount of the outstanding debt securities.
(Section 507)
However, the holder of any debt security will have an absolute
right to receive payment of principal, interest and any premium on or
after the due dates expressed in the debt security and to institute
suit to enforce any payment. (Section 508)
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BOOK-ENTRY DEBT SECURITIES
A series of debt securities may be issued in whole or in part in
the form of one or more global securities that will be deposited with,
or on behalf of, a depository identified in the prospectus supplement.
Payments of principal, interest and any premium on the series of debt
securities represented by a global security will be made to the
depository.
We anticipate that any global securities will be deposited with,
or on behalf of, The Depository Trust Company, New York, New York,
that the global securities will be registered in the name of DTC's
nominee, and that the following provisions will apply to the
depository arrangements with respect to the global securities. The
prospectus supplement will describe additional or differing terms of
the depository arrangement involving any series of debt securities
issued in the form of global securities.
So long as DTC or its nominee is the registered owner of a global
security, DTC or its nominee will be considered the sole holder of the
debt securities represented by the global security for all purposes
under the applicable indenture. Except as described below, owners of
beneficial interests in a global security:
- will not be entitled to have debt securities represented by
the global security registered in their names;
- will not receive or be entitled to receive physical delivery
of debt securities in the form of a certificate; and
- will not be considered the record owners or holders of debt
securities under the applicable indenture.
The laws of some states require that purchasers of securities
take physical delivery of the securities in certificated form. These
laws may limit the transferability of beneficial interests in a global
security.
If DTC is at any time unwilling or unable to continue as
depository with respect to any debt securities represented by a global
security and we do not appoint a successor depository within 60 days,
we will issue individual debt securities in certificated form in
exchange for the global security. In addition, we may at any time
determine not to have any debt securities of one or more series
represented by global securities and instead will issue the individual
debt securities in certificated form in exchange for the global
securities. In this instance, an owner of a beneficial interest in a
global security will be entitled to physical delivery of individual
debt securities in the form of a certificate equal in principal amount
to the beneficial interest and to have the debt securities in the form
of a certificate registered in its name.
We obtained the following information concerning DTC and its
book-entry system from sources, including DTC, that we believe to be
reliable, but we take no responsibility for the accuracy of this
information.
11
DTC will act as securities depository for the debt securities.
The debt securities will be issued as fully registered securities
registered in the name of Cede & Co., which is DTC's partnership
nominee.
One fully registered debt security certificate will be issued
with respect to up to $400,000,000 of principal amount of the series
of debt securities, and an additional certificate will be issued with
respect to any remaining principal amount of that series.
DTC is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the
New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Commercial
Code, and a "clearing agency" registered pursuant to the provisions of
Section 17A of the Securities Exchange Act. DTC holds securities that
its participants deposit with DTC. DTC also facilitates the
settlement among participants of securities transactions, including
transfers and pledges, in deposited securities through electronic
computerized book-entry changes in participants' accounts, thereby
eliminating the need for physical movement of securities certificates.
Direct participants of DTC include securities brokers and dealers,
banks, trust companies, clearing corporations and other organizations.
A number of the direct participants and the New York Stock Exchange,
the American Stock Exchange, and the National Association of
Securities Dealers own DTC. Access to DTC's system also is available
to others, including securities brokers and dealers and banks and
trust companies that clear through or maintain a custodial
relationship with a direct participant, either directly or indirectly.
The rules applicable to DTC and its participants are on file with the
SEC.
Purchases of debt securities under the DTC system must be made by
or through direct participants, which will receive a credit for the
debt securities on DTC's records. The ownership interest of each
beneficial owner or each actual purchaser of each debt security is to
be recorded on the direct and indirect participants' records. A
beneficial owner of debt securities will not receive written
confirmation from DTC of its purchase, but is expected to receive a
written confirmation providing details of the transaction, as well as
periodic statements of its holdings, from the participant through
which the beneficial owner entered into the transaction. Transfers of
ownership interests in debt securities are to be accomplished by
entries made on the books of participants acting on behalf of
beneficial owners. Beneficial owners will not receive certificates
representing their ownership interests in the debt securities, unless
the use of the book-entry system for the debt securities is
discontinued.
To facilitate subsequent transfers, any certificate representing
debt securities which is deposited with, or on behalf of, DTC is
registered in the name of its nominee, Cede & Co. The deposit of the
certificate with, or on behalf of, DTC and its registration in the
name of Cede & Co. effect no change in beneficial ownership. DTC has
no knowledge of the actual beneficial owners of the certificate
representing the debt securities; DTC's records reflect only the
identity of the direct participants to whose accounts the debt
securities are credited, which may or may not be the beneficial
12
owners. The participants will remain responsible for keeping account
of their holdings on behalf of their customers.
Delivery of notices and other communications by DTC to direct
participants, by direct participants to indirect participants, and by
direct and indirect participants to beneficial owners, will be
governed by arrangements among them and any statutory or regulatory
requirements.
Neither DTC nor Cede & Co. will consent or vote with respect to
the debt securities. Under its usual procedures, DTC mails an omnibus
proxy to Arvin as soon as possible after the record date. The omnibus
proxy assigns Cede & Co.'s consenting or voting rights to those direct
participants identified on a list attached to the omnibus proxy to
whose accounts the debt securities are credited on the record date.
Principal, interest, and premium payments on the debt securities
will be made to DTC. DTC's practice is to credit direct participants'
accounts on the payable date with respect to their holdings as shown
on DTC's records unless DTC has reason to believe that it will not
receive payment on the payment date. Payments by participants to
beneficial owners will be governed by standing instructions and
customary practices, as is the case with securities held for the
accounts of customers in bearer form or registered in "street name,"
and will be the responsibility of the participant and not of DTC, the
trustee, or the paying agent, subject to any statutory or regulatory
requirements. Payment of principal and interest to DTC is the
responsibility of Arvin or the trustee or any paying agent.
Disbursement of payments to direct participants will be the
responsibility of DTC. Disbursement of payments to the beneficial
owners will be the responsibility of the direct and indirect
participants.
If applicable, redemption notices will be sent to Cede & Co. If
less than all of the debt securities within an issue are being
redeemed, DTC's practice is to determine by lot the amount of the
interest of each direct participant in the issue to be redeemed.
A beneficial owner will give notice of any option to elect to
have its debt securities repaid by Arvin, through its participant, to
the applicable trustee, and will effect delivery of the debt
securities by causing the direct participant to transfer the
participant's interest in the global security or securities
representing the debt securities, on DTC's records, to the trustee.
The requirement for physical delivery of debt securities in connection
with a demand for repayment will be deemed satisfied when the
ownership rights in the global security or securities representing the
debt securities are transferred by direct participants on DTC's
records.
DTC may discontinue providing its services as securities
depository with respect to the debt securities at any time by giving
reasonable notice to Arvin or the paying agent. If a successor
securities depository is not appointed, debt security certificates are
required to be printed and delivered.
13
Arvin may decide to discontinue use of the system of book-entry
transfers through DTC or a successor securities depository. In that
event, debt security certificates will be printed and delivered.
Unless stated otherwise in the applicable prospectus supplement,
any underwriters, dealers or agents with respect to any series of debt
securities issued as global securities will be direct participants in
DTC.
None of Arvin, any underwriter, dealer or agent, the applicable
trustee or any paying agent will have any responsibility or liability
for any aspect of the records relating to or payments made on account
of beneficial interests in a global security, or for maintaining,
supervising or reviewing any records relating to these beneficial
interests.
YEAR 2000 COMPLIANCE
DTC has advised us that its management is aware that some
computer applications, systems and the like for processing data that
are dependent upon calendar dates, including dates before, on, and
after January 1, 2000, may encounter "Year 2000 problems." DTC has
informed the industry, including direct and indirect participants and
other members of the financial community, that it has developed and is
implementing a program so that its systems, as the same relate to the
depository services, namely the timely payment of distributions,
including principal and interest payments, to security holders, book-
entry deliveries, and settlement of trades within the depository,
continue to function appropriately. This program includes a technical
assessment and a remediation plan, each of which is complete.
Additionally, DTC's plan includes a testing phase, which is expected
to be completed within appropriate time frames.
However, DTC's ability to perform its services properly also is
dependent upon other parties, including, without limitation, issuers
and their agents, as well as the direct and indirect participants,
third party vendors from whom it licenses software and hardware, and
third party vendors on whom it relies for information or the provision
of services, including telecommunication and electrical utility
service providers, among others. DTC has informed the industry that
it is contacting and will continue to contact third party vendors from
whom it acquires services to:
- impress upon them the importance of these services being
Year 2000 compliant; and
- determine the extent of their efforts for Year 2000
remediation and, as appropriate, testing of their services.
In addition, DTC is in the process of developing contingency plans as
it deems appropriate.
According to DTC, this information with respect to Year 2000
compliance has been provided to the industry for informational
purposes only and is not intended to serve as a representation,
warranty, or contract modification of any kind.
14
INFORMATION CONCERNING THE TRUSTEE
Harris Trust and Savings Bank is the trustee under the senior
indenture. The trustee under the subordinated indenture will be
identified in a prospectus supplement. Each trustee may also serve as
warrant agent with respect to any debt warrants to purchase underlying
debt securities issued under the indenture with respect to which it
acts as trustee. We also maintain banking relationships in the
ordinary course of business with Harris Trust and Savings Bank, and
Harris Trust and Savings Bank participates, along with several other
banks, in credit facilities with Arvin and its subsidiaries. At the
date of this prospectus, Harris Trust and Savings Bank is the trustee
with respect to our 6 7/8% Notes due February 15, 2001, 6 3/4% Notes
due March 15, 2008, and 7 1/8% Notes due March 15, 2009. As of April
4, 1999, Harris Trust and Savings Bank also was trustee with respect
to $36,000,000 aggregate principal amount of our Medium Term Notes
issued under the senior indenture. As of April 4, 1999, we had
outstanding $361,000,000 total principal amount of our debt securities
issued under the senior indenture.
GOVERNING LAW
The indentures are, and the debt securities will be, governed by
the laws of the State of New York.
PROVISIONS APPLICABLE SOLELY TO SENIOR DEBT SECURITIES
Senior debt securities will be issued under the senior indenture
and will rank pari passu with all our other unsecured and
unsubordinated debt.
COVENANTS
The senior indenture contains covenants, including those
described below with respect to the incurrence of secured debt by
Arvin and the restricted subsidiaries, sale and leaseback transactions
on the part of Arvin and the restricted subsidiaries, and the transfer
of principal facilities to unrestricted subsidiaries. Terms used in
these covenants are defined below under "Definitions." These
covenants do not focus on the amount of debt incurred in any
transaction and do not afford protection to holders of the debt
securities in the event of a highly leveraged transaction that is not
in violation of the covenants. At the date of this prospectus, we do
not intend to include any covenants or other provisions affording
protection to holders of any series of the debt securities. If we
desire to include the covenants or other provisions in the future, the
applicable prospectus supplement will describe them.
SECURED DEBT. The senior indenture provides that so long as the
senior debt securities are outstanding, we will not and will not cause
or permit a restricted subsidiary to create, incur, assume or
guarantee any secured debt or create any security interest securing
any indebtedness existing on the date of the indenture constituting
secured debt if it were secured by a security interest in a principal
facility, unless the senior debt securities will be secured equally
and ratably by that security interest. However, we and our restricted
subsidiaries may create, incur, assume or guarantee secured debt
15
without securing the senior debt securities in the case of
indebtedness secured by:
- security interests to secure payment of the cost of
acquisition, construction, development or improvement of
property;
- security interests on property at the time of acquisition
assumed by us or a restricted subsidiary, or on the property
or on the outstanding shares or indebtedness of a
corporation or firm when it becomes a restricted subsidiary
or is merged into or consolidated with or acquired as an
entirety or substantially as an entirety by us or a
restricted subsidiary;
- security interests arising from conditional sales agreements
or title retention agreements with respect to property
acquired by us or any restricted subsidiary;
- security interests securing indebtedness of a restricted
subsidiary owing to us or to another restricted subsidiary;
- mechanics' and other statutory liens arising in the ordinary
course of business for obligations that are not due or that
are being contested in good faith;
- liens for taxes, assessments or governmental charges not yet
due that are being contested in good faith;
- security interests, including judgment liens, arising in
connection with legal proceedings being contested in good
faith and, in the case of judgment liens, on which execution
is stayed;
- landlords' liens on fixtures;
- security interests to secure partial, progress, advance or
other payments or indebtedness that were incurred to finance
construction on or improvement of property; and
- security interests in favor, or made at the request of,
governmental bodies.
Permitted secured debt also includes, with limitations, any
extension, renewal or refunding of all or any part of any secured debt
that was permitted at the time it was originally incurred. In
addition, we and our restricted subsidiaries may incur secured debt,
without equally and ratably securing the senior debt securities, if
the sum of:
- the amount of secured debt entered into after the date of
the senior indenture and otherwise prohibited by the senior
indenture, plus
- the aggregate value of sale and leaseback transactions
entered into after the date of the senior indenture and
otherwise prohibited by the senior indenture does not exceed
16
ten percent of Arvin's consolidated net tangible assets.
(Section 1005)
SALE AND LEASEBACK TRANSACTIONS. The senior indenture provides
that so long as debt securities are outstanding, we will not, and will
not permit any restricted subsidiary to, enter into any sale and
leaseback transaction unless we or a restricted subsidiary:
- would be entitled to incur secured debt by reason of the
provision described in the last sentence of the preceding
paragraph equal in amount to the net proceeds of the
property sold or transferred or to be sold or transferred in
the sale and leaseback transaction and secured by a security
interest on the property to be leased, without equally and
ratably securing the debt securities, or
- will apply, within 180 days after the effective date of the
sale and leaseback transaction, an amount equal to the net
proceeds to:
(1) the acquisition, construction, development or
improvement of properties, facilities or equipment
which are, or will be, a principal facility or
facilities or a part of them;
(2) the redemption of senior debt securities; or
(3) the repayment of senior funded debt of Arvin or any
restricted subsidiary, except senior funded debt owed
to any restricted subsidiary, or in part to the
acquisition, construction, development or improvement
and in part to that redemption and/or payment.
Instead of applying an amount equal to the net proceeds to that
redemption, we may, within 180 days after that sale or transfer,
deliver to the trustee senior debt securities for cancellation and
reduce the amount to be applied to the redemption of the senior debt
securities by an amount equivalent to the total principal amount of
the senior debt securities delivered. (Section 1006)
ASSET TRANSFERS. The senior indenture provides that so long as
debt securities are outstanding, we will not, and will not cause or
permit any restricted subsidiary to, transfer any principal facility
to any unrestricted subsidiary unless, within 180 days of the
effective date of the transaction, it applies an amount equal to the
fair value of the principal facility at the time of transfer to:
- the acquisition, construction, development or improvement of
properties, facilities or equipment which are, or will be, a
principal facility or facilities or a part of them;
- the redemption of senior debt securities; or
- the repayment of senior funded debt of Arvin or any
restricted subsidiary, except senior funded debt owed to any
restricted subsidiary, or in part to the acquisition,
construction, development or improvement and in part to that
redemption and/or repayment.
17
Instead of applying all or any part of the amount to that
redemption, we may, within 180 days of that transfer, deliver to the
trustee senior debt securities for cancellation and reduce the amount
to be applied to the redemption of the senior debt securities by an
amount equivalent to the total principal amount of the senior debt
securities delivered. (Section 1007)
DEFINITIONS
Section 101 of the senior indenture defines the following terms,
which are used in the prospectus, substantially as follows:
"Consolidated net tangible assets" means with respect to us:
- the total amount of assets, less applicable reserves and
other properly deductible items, after deducting:
(1) all liabilities and liability items, except for
indebtedness payable, or renewable or extendable at the
option of the obligor, for more than one year from the
date of incurrence, capitalized rent, capital shares,
including redeemable preferred shares, and surplus,
surplus reserves and deferred income taxes and credits
and other non-current liabilities, and
(2) all goodwill, trade names, trademarks, patents,
unamortized debt discount, unamortized expenses
incurred in the issuance of debt, and other like
intangibles which under generally accepted accounting
principles in effect on July 3, 1990 would be included
on a consolidated balance sheet of Arvin and the
restricted subsidiaries, less:
- loans, advances, equity investments and guarantees, other
than accounts receivable arising from the sale of
merchandise in the ordinary course of business, at the time
outstanding that we and our restricted subsidiaries made or
incurred to, in or for unrestricted subsidiaries or to, in
or for corporations while they were restricted subsidiaries
and, when computed, are unrestricted subsidiaries.
"Principal facility" means any manufacturing plant, warehouse,
office building or parcel of real property, including fixtures, but
excluding leases and other contract rights which might otherwise be
deemed real property, owned by us or any restricted subsidiary,
whether owned on the date of the senior indenture or afterwards. Each
plant, warehouse, office building or parcel of real property must have
a gross book value, without deduction for any depreciation reserves,
at the date of the determination in excess of three percent of our
consolidated net tangible assets, other than any plant, warehouse,
office building or parcel of real property or portion which, in our
board of directors' opinion, is not materially important to our
business and that of our subsidiaries taken as a whole.
"Restricted subsidiary" means
- any subsidiary other than an unrestricted subsidiary, and
18
- any subsidiary that was an unrestricted subsidiary but
which, after the date of the applicable indenture, we
designate to be a restricted subsidiary by board resolution.
However, we may not designate any subsidiary as a restricted
subsidiary if we would breach any covenant or agreement contained in
the senior indenture as a result.
"Sale and leaseback transaction" means any sale or transfer made
by us or any restricted subsidiary of any principal facility that:
- in the case of any manufacturing plant, warehouse or office
building, has been in operation, use or commercial
production, exclusive of test and start-up periods, by us or
any restricted subsidiary for more than 190 days before the
sale or transfer, or
- in the case of a principal facility that is another parcel
of real property, has been owned by us or any restricted
subsidiary for more than 180 days before that sale or
transfer,
if that sale or transfer is made with the intention of leasing, or as
part of an arrangement involving the lease of the principal facility
to us or a restricted subsidiary, except for a lease for a period up
to 36 months made with the intention that the use of the leased
principal facility by us or a restricted subsidiary will be
discontinued on or before that period expires. Any sale or transfer
made to Arvin or any restricted subsidiary is not a sale and leaseback
transaction. Any secured debt permitted under the senior indenture
will not be deemed to create or be a sale and leaseback transaction.
"Secured debt" means any indebtedness for money borrowed by, or
evidenced by a note or other instrument of, us or a restricted
subsidiary, and any other indebtedness of us or a restricted
subsidiary on which interest is paid or payable, including obligations
evidenced or secured by leases, installment sales agreements or other
instruments in connection with private activity bonds qualified under
section 141 of the Internal Revenue Code, other than indebtedness that
a restricted subsidiary owes to us or another restricted subsidiary or
that we owe to a restricted subsidiary, secured by a security interest
in any principal facility, or a security interest in any shares that
we own directly or indirectly in a restricted subsidiary or in
indebtedness for money borrowed by a restricted subsidiary from us or
another restricted subsidiary. The securing in this manner of any
previously unsecured debt will be deemed to be the creation of secured
debt when security is given. The amount of secured debt at any time
outstanding will be the total amount then owing by us and our
restricted subsidiaries.
"Senior funded debt" means any obligation of Arvin or any
restricted subsidiary which was funded debt as of the date of creation
and that, in our case, is not subordinate and junior in right of
payment to the prior payment of the senior debt securities. "Funded
debt" means any obligation payable, or renewable or extendable at the
option of the obligor, for more than one year from the date of
incurrence, which under generally accepted accounting principles
should be shown on the balance sheet as a liability.
19
"Subsidiary" means any corporation of which we and/or one or more
subsidiaries own or control directly or indirectly more than 50
percent of the shares of voting stock.
"Unrestricted subsidiary" means:
- any subsidiary acquired or organized after the date of the
senior indenture, if that subsidiary is not a successor,
directly or indirectly, to and does not directly or
indirectly own any equity interest in, any restricted
subsidiary;
- any subsidiary whose principal business and assets are
located outside the United States and/or Canada or both;
- any subsidiary whose principal business consists of
financing the acquisition or disposition of machinery,
equipment, inventory, accounts receivable and other real,
personal and intangible property by persons including us or
a subsidiary;
- any subsidiary whose principal business is owning, leasing,
dealing in or developing real property for residential or
office building purposes; and
- any subsidiary, most of whose assets consist of shares or
other securities of an unrestricted subsidiary or
unrestricted subsidiaries of the character described in the
foregoing clauses of this definition, unless and until this
subsidiary has been designated a restricted subsidiary by
board resolution.
PROVISIONS APPLICABLE SOLELY TO SUBORDINATED DEBT SECURITIES
Subordinated debt securities will be issued under the
subordinated indenture and rank pari passu with our other outstanding
subordinated debt and rank junior to all of our outstanding senior
indebtedness. As described in the prospectus supplement, the
particular terms of the subordinated debt securities being offered,
including the subordination terms and the definition of senior
indebtedness, may differ from those described below.
SUBORDINATION
The payment of the principal, interest and any premium on the
subordinated debt securities is expressly subordinated, to the extent
and in the manner provided in the subordinated indenture, in right of
payment to the prior payment in full of all of our senior
indebtedness, as may be changed by the terms of the subordinated debt
securities in the prospectus supplement.
In the event of any dissolution or winding up, or total or
partial liquidation or reorganization of Arvin, whether in bankruptcy,
reorganization, insolvency, receivership or similar proceeding, the
holders of senior indebtedness will be entitled to receive payment in
full of all amounts due or to become due on all senior indebtedness
before the holders of the subordinated debt securities are entitled to
receive any payment on the subordinated debt securities, including
20
principal, interest or any premium. Except as indicated in the
prospectus supplement, no payment in respect of the subordinated debt
securities will be made if, at the time of payment, there is a default
in payment on any senior indebtedness, and this default has not been
cured or waived in writing or the benefits of subordination in the
subordinated indenture have not been waived in writing by or on behalf
of the holders of the senior indebtedness.
Notwithstanding the foregoing, if the trustee or the holder of
any of the subordinated debt securities receives any payment or
distribution of any kind before all senior indebtedness is paid in
full or payment is provided for, that payment or distribution will be
applied to the payment of all senior indebtedness remaining unpaid, to
the extent necessary to pay all senior indebtedness in full, after
giving effect to any concurrent payment or distribution to or for
holders of senior indebtedness.
The subordinated indenture defines "senior indebtedness" as
indebtedness, either outstanding as of the date of the subordinated
indenture or subsequently issued, that by its terms is neither
subordinated in right of payment to any of our unsecured indebtedness,
nor is pari passu with our subordinated indebtedness.
The subordinated indenture defines "indebtedness," as applied to
any person, as all indebtedness, whether represented by bonds,
debentures, notes or other securities, created or assumed by that
person for repayment of money borrowed, and obligations, computed
according to generally accepted accounting principles, as lessee under
leases that should be treated as capital leases. All indebtedness
secured by a lien upon property owned by us or any subsidiary and upon
which indebtedness that person customarily pays interest, without
assuming or becoming liable for the payment of this indebtedness, will
be deemed to be indebtedness of that person. All indebtedness of
others guaranteed as to payment of principal by that person or in
effect guaranteed by that person through a contingent agreement to
purchase it also will be deemed to be indebtedness of that person.
If subordinated debt securities are issued under the subordinated
indenture, the total principal amount of senior indebtedness
outstanding as of a recent date will be indicated in the prospectus
supplement. The subordinated indenture does not restrict the amount of
senior indebtedness that we may incur.
CONVERSION
The prospectus supplement will describe terms of conversion of
any series of subordinated debt securities into common shares or other
securities of Arvin. Unless the prospectus supplement provides
otherwise, any right to convert subordinated debt securities called
for redemption will terminate at the close of business on the
redemption date. In the case of subordinated debt securities
convertible into common shares, the initial conversion price will be
adjusted for particular events, including:
- a dividend or distribution on the common shares in the form
of common shares;
- a subdivision or combination of the common shares;
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- an issuance to all holders of common shares of rights other
than the preferred share purchase rights described below, or
warrants entitling them to subscribe for or purchase common
shares at less than the current market price; and
- a distribution on the common shares of evidences of our
indebtedness, assets other than cash dividends or
distributions from retained earnings, rights other than the
preferred share purchase rights, or warrants to subscribe
for or purchase any of its securities, other than those
referred to above.
In addition, unless the prospectus supplement indicates
otherwise, in any of the following events, the holders of subordinated
debt securities that are convertible into common shares will have the
right to convert them into the kind and amount of shares and other
securities or assets that are receivable upon this event by a holder
of the number of common shares issuable upon their conversion
immediately before that event.
- the reclassification or change of outstanding common shares,
other than changes in par value or as a result of a
subdivision or combination;
- any consolidation, merger or combination of Arvin as a
result of which holders of common shares will be entitled to
receive shares, securities or other assets with respect to
or in exchange for the common shares; or
- any sale or conveyance of our assets as, or substantially
as, an entirety to any other entity in which holders of
common shares will be entitled to receive shares, securities
or other assets with respect to or in exchange for the
common shares.
No adjustment of the conversion price is necessary until
cumulative adjustments amount to at least one percent of the current
conversion price. We reserve the right to make reductions in the
conversion price, in addition to those required in the provisions
above, as we determine to be advisable so that share-related
distributions made by us to our shareholders will not be taxable. Each
common share issued upon conversion will sometimes include preferred
share purchase rights. We will not issue fractional common shares
upon conversion of subordinated debt securities that are convertible
into common shares, but instead will pay a cash adjustment based upon
the market price of the common shares.
Unless the prospectus supplement provides otherwise, subordinated
debt securities surrendered for conversion during the period from the
close of business on any regular record date next preceding any
interest payment date to the opening of business on the interest
payment date must be accompanied by payment of an amount equal to the
interest which the registered holder is to receive. In the case of any
subordinated debt security converted after any regular record date but
on or before the next interest payment date, interest whose stated
maturity is on that interest payment date will be payable on the
interest payment date notwithstanding the conversion, and that
interest will be paid to the holder on the regular record date. Except
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as described above, no interest on converted securities will be
payable by us on any interest payment date after the date of
conversion. No other payment or adjustment for interest or dividends
will be made upon conversion.
The conversion price for any subordinated debt securities
convertible into our securities other than common shares will be
subject to the adjustment as may be indicated in the prospectus
supplement.
DESCRIPTION OF CAPITAL SHARES
GENERAL
Under our Restated Articles of Incorporation, we are authorized
to issue 50,000,000 common shares, par value $2.50 per share,
25,829,909 of which were issued and outstanding as of April 4, 1999
and 8,978,058 preferred shares, without par value, none of which were
outstanding as of April 4, 1999. The common shares and the preferred
shares may be issued at any time by our board of directors in any
series with terms as may be fixed by board resolution providing for
their issuance. The number of authorized preferred shares includes
500,000 authorized Series C junior participating preferred shares
reserved for issuance upon the exercise of rights, under the rights
agreement described below, none of which were outstanding as of April
4, 1999. The number of authorized Series C preferred shares may be
increased by board resolution. We may issue the remainder of the
preferred shares in one or more series.
COMMON SHARES
Subject to the prior dividend rights of the preferred shares,
holders of the common shares are entitled to receive dividends and
other distributions upon declaration by our board. Some of our long-
term debt obligations contain covenants that may indirectly restrict
the payment of dividends on our capital shares, although none
materially limits our ability to pay dividends at the date of this
prospectus. A prospectus supplement relating to common shares will
describe any material limitations.
Holders of common shares are entitled to one vote for each share.
Except as the Indiana Business Corporation Law requires or as may be
specifically provided in an amendment to our articles of
incorporation, holders of common shares vote together with any
preferred shares having general voting rights as a single class.
After the satisfaction of creditors and the prior rights of any
preferred shares upon any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of Arvin, the holders of the
common shares are entitled to share ratably in our remaining assets.
The common shares have no conversion privileges or preemptive
rights and, except as described below, are not subject to redemption
at our option. The articles of incorporation, the Indiana Business
Corporation Law, and various loan agreements to which we are or may
become a party may restrict our ability to redeem or repurchase our
shares in other situations.
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The common shares are listed on the New York Stock Exchange and
the Chicago Stock Exchange. Harris Trust and Savings Bank is the
transfer agent and registrar of the common shares.
PROVISIONS WITH POSSIBLE ANTI-TAKEOVER EFFECTS
Our by-laws currently provide for the classification of the board
of directors into three classes. Our articles of incorporation:
- limit the number of directors that may be elected to at
least 12 but not more than 17, excluding the number of
directors as may be elected by any class of our shares other
than common shares on account of specific dividend
arrearages in accordance with our articles of incorporation,
- permit removal of directors only for cause and only by the
affirmative vote of two-thirds of the outstanding voting
shares,
- establish the power to make, alter, amend or repeal the by-
laws exclusively in the board of directors, and
- require that any merger, dissolution or other significant
restructuring of Arvin be approved by 80% of the directors
or by 80% of the shares outstanding and entitled to vote on
this.
Our by-laws also provide that amendments require an affirmative vote
of two-thirds of the directors then in office. Our articles of
incorporation provide that the by-laws may contain provisions
requiring the disclosure to us of the names of beneficial owners of
common shares and imposing sanctions in the event of nondisclosure,
including prohibiting voting by, withholding dividends to, and
redeeming the common shares held by the non-disclosing record holders.
However, our by-laws currently do not contain these provisions.
In addition, our articles of incorporation provide that if any
person who beneficially owns more than 50% of our outstanding common
shares acquires any additional shares in a tender offer or becomes the
beneficial owner of more than 50% of our outstanding common shares in
a tender offer, not approved by a majority of the board of directors
who are unaffiliated with the person or entity making the tender
offer, then all holders of common shares and all holders of rights,
options, warrants, and securities then exercisable or convertible into
common shares are entitled for a limited period to have us repurchase
any or all of their shares at the "repurchase price." The "repurchase
price" is the greater of:
- the highest per share price paid by the person or entity
making the tender offer within the prior eighteen months,
plus the aggregate earnings per common share for the
preceding four quarters less cash dividends paid on common
shares during those four quarters, or
- the shareholder equity per common share.
These provisions can be amended by only an 80% shareholder vote,
subject to other limitations. The Indiana Business Corporation Law
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limits our obligation to repurchase shares. Also, the terms and
provisions of outstanding preferred shares or loans or other
agreements to which we might be a party also could limit our
obligation.
Chapter 42 of the Indiana Business Corporation Law eliminates the
voting rights of "control shares" held by "acquiring persons" who
acquire shares giving them one-fifth, one-third or a majority of the
voting power of particular corporations, including us. Control shares
acquired in a control share acquisition retain the same voting rights
as were accorded the shares before this acquisition only to the extent
granted by resolutions approved by the disinterested shareholders. If
shareholders approve the voting rights of control shares and a
shareholder has acquired control shares with a majority or more of the
voting power, all shareholders of the corporation are entitled to
exercise statutory dissenters' rights and to demand the value of their
shares in cash from the corporation. If the control shares have no
voting rights, the corporation has the right to redeem them. In
addition, if authorized in a corporation's articles of incorporation
or by-laws, the corporation may for a period of time redeem the shares
that caused a person to become an acquiring person at their fair value
unless the acquiring person provides information specified in the
Indiana Business Corporation Law to the corporation. Our by-laws
authorize this redemption. These Indiana Business Corporation Law
provisions do not apply to acquisitions of voting power pursuant to a
merger or share exchange agreement to which the corporation is a
party.
Chapter 43 of the Indiana Business Corporation Law imposes some
restrictions on the ability of an "interested shareholder," including
a beneficial owner of at least 10% of the outstanding voting shares,
of a "resident domestic corporation," like us, to engage in a
"business combination," as defined in the statute, with the resident
domestic corporation, unless specific requirements are met. These
requirements include a five-year waiting period after the shareholder
becomes an interested shareholder, unless the corporation's board of
directors has approved the acquisition of 10% or more of the voting
shares or the business combination before the date of the acquisition
of voting shares. Following this period, a business combination may
be effected with an interested shareholder only upon:
- the approval of the business contribution by the
corporation's shareholders, excluding the interested
shareholder and any of its affiliates or associates, or
- the consideration to be received by shareholders in the
business combination meets the fairness criteria described
in chapter 43.
Chapter 43 broadly defines "business combination" to include mergers,
sales or leases of assets, transfers of shares of the corporation,
proposals for liquidation and the receipt by an interested shareholder
of any financial assistance or tax advantage from the corporation,
except proportionately as a shareholder of the corporation.
The overall effect of the above provisions may be to discourage,
or render more difficult, a merger, tender offer, proxy contest, the
assumption of control of Arvin by a holder of a large block of our
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shares or other person, or the removal of incumbent management, even
if these actions may be beneficial to our shareholders generally.
PREFERRED SHARE PURCHASE RIGHTS
Each outstanding common share includes one right to purchase one
one-hundredth of a Series C preferred share. A rights agreement dated
as of May 29, 1986, as amended by amendments dated as of February 23,
1989, November 10, 1994 and May 10, 1996, between Arvin and Harris
Trust and Savings Bank governs the terms and conditions of these
rights. This description of the rights is qualified by the rights
agreement, filed as part of our current report on Form 8-K dated June
16, 1986 and the amendments filed with our current reports on Form 8-K
dated February 23, 1989 and May 10, 1996 and with our quarterly report
on Form 10-Q for the quarter ended October 2, 1994.
Currently, the rights are not exercisable, certificates
representing rights have not been issued and the rights automatically
trade with the common shares. However, ten days after an acquiring
person or group either acquires beneficial ownership of 20% or more of
the outstanding common shares or makes an offer to acquire 20% or more
of the outstanding common shares, the rights become exercisable,
certificates representing the rights will be issued as soon as
practicable afterwards and the rights will begin to trade
independently from the common shares. The rights will not have any
voting power. When the rights become exercisable, a holder becomes
entitled to buy one one-hundredth of a newly-issued Series C preferred
share for each right at an exercise price of $90, subject to anti-
dilution adjustments. Each Series C preferred share will be entitled
to one vote per share, voting together with the common shares and to
other voting rights. Holders of Series C preferred shares also have
special rights to participate in the election of two additional
directors in the event of specified dividend arrearages. Each Series C
preferred share, if and when issued upon the exercise of a right, will
be entitled to a minimum preferential quarterly dividend at the rate
of $25 per share, but subject to adjustments, will be entitled to a
total dividend of 100 times the dividend declared per common share in
the preceding quarter. The holders of the Series C preferred shares
will receive a preferred liquidation payment of $100 per share, but
will be entitled to receive an aggregate liquidation payment equal to
100 times the payment made per common share.
If any person or group becomes an acquiring person or a
transaction occurs that increases the acquiring person's proportionate
ownership of the common shares, each right, other than those held by
an acquiring person, will become exercisable at the current exercise
price of the right, for that number of common shares then having a
market value of two times the exercise price of the right. If,
following the acquisition by a person or group of 20% or more of the
outstanding common shares, Arvin is involved in a merger or other
business combination transaction or sells or transfers assets or
earnings power totaling more than 50% of its assets or earning power,
each right will become exercisable, at the current exercise price, for
that number of shares of common stock of the acquiring company then
having a market value of two times the exercise price of each right.
The board of directors may redeem the rights for $.10 per right,
subject to adjustment, until a person or group becomes an acquiring
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person. Any redemption is effective at the time, on the basis, and
with the conditions that the board of directors may establish. The
rights expire on June 13, 2006, unless earlier redeemed.
The purchase price payable, and the number of Series C preferred
shares or other securities or property issuable upon exercise of the
rights are subject to adjustment to prevent dilution in some
circumstances.
So long as the rights are attached to the common shares, we will
issue one right with each new common share. All common shares issued
will have attached rights. We also will issue one right with each new
common share:
- issuable upon conversion of any convertible security issued,
and
- issued upon exercise of options to purchase the common
shares granted by Arvin,
before the time that the rights are no longer attached to the common
shares.
The rights have anti-takeover effects. The rights will cause
substantial dilution to a person who attempts to acquire Arvin without
conditioning its offer on a substantial number of the rights being
acquired. The rights also will adversely affect a person who desires
to obtain control of Arvin. The rights will not affect a transaction
approved by our board of directors before the existence of an
acquiring person, because the rights can be redeemed.
PREFERRED SHARES
The following description of preferred shares sets forth general
terms and provisions of any series of preferred shares to which any
prospectus supplement may relate. The applicable prospectus supplement
will describe the specific terms of a particular series of preferred
shares, which may differ from the following terms. The descriptions
of preferred shares below and in the prospectus supplement are
qualified in their entirety by reference to the articles of
incorporation and any applicable amendments, which are filed or
incorporated by reference as an exhibit to the registration statement
of which this prospectus is a part.
Under the articles of incorporation, our board of directors is
authorized to issue preferred shares in one or more series and with
rights, preferences, privileges and restrictions, including dividend
rights, voting rights, conversion rights, terms of redemption and
liquidation preferences that they may fix or designate without any
further vote or action by our shareholders.
The specific terms of a particular series of preferred shares
offered will be described in the applicable prospectus supplement,
including:
- the maximum number of shares of the series and their
distinctive designations;
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- any annual dividend rate on the shares of the series;
- any dates that dividends begin to accrue or accumulate;
- whether the dividends will be cumulative, and any dividend
preference;
- the price and the terms and conditions of any redemption;
- any liquidation preference applicable to the shares of the
series;
- whether the shares will be subject to, and the terms and
provisions of, a retirement or sinking fund;
- any terms and conditions for conversion or exchange of the
shares of the series into or for shares of any other class of
Arvin;
- any voting rights of the shares or the series;
- whether fractional interest in a series of the shares will be
offered in the form of depositary shares; and
- any or all other preferences or other rights or restrictions
of the shares of the series.
Any prospectus supplement that specifies the terms of preferred
shares also will describe any restriction on the repurchase or
redemption of shares by Arvin while there is any arrearage in the
payment of dividends or, if applicable, sinking fund installments, or
will state that there is no restriction.
In addition to the voting rights of any series of preferred
shares established by the board of directors, under the articles of
incorporation, the holders of at least two-thirds of the total number
of outstanding preferred shares, voting together as a single class,
must approve any amendment to Arvin's articles of incorporation that
would authorize any class of shares, or of securities convertible into
shares, which would rank before the then outstanding preferred shares
as to payment of dividends, or as to distribution of assets upon
liquidation, dissolution or winding up of Arvin or any amendment to
the articles of incorporation that would change the designation,
rights or preferences of the outstanding preferred shares and
adversely affect them. No change may be made without the approval of
the holders of at least two-thirds of the then outstanding shares of
the particular series that would be affected, voting separately as a
series. Arvin's articles of incorporation also provide that
additional preferred shares of a series may not be authorized and that
a class of shares that would rank on parity with outstanding preferred
shares as to assets or dividends may not be authorized without the
consent of the holders of at least a majority of the total number of
outstanding preferred shares, voting separately as a class, without
regard to series.
The holders of preferred shares also may have the right, voting
separately as a class or series, to cast one vote per share upon
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matters for which the Indiana Business Corporation Law requires a
class vote of preferred shares.
In addition to any series of preferred shares that the applicable
prospectus supplement describes, the articles of incorporation,
without regard to series, authorize 500,000 Series C preferred shares
to be issued upon exercise of the rights under the rights agreement.
DESCRIPTION OF SHARE PURCHASE CONTRACTS AND SHARE PURCHASE UNITS
We may issue share purchase contracts, including contracts
obligating holders to purchase from Arvin, and Arvin to sell to the
holders, a specified number of common shares at a future date or
dates. The consideration per common share may be fixed at the time the
share purchase contracts are issued or may be determined by reference
to a specific formula described in the share purchase contracts. We
may issue the share purchase contracts separately or as a part of
share purchase units consisting of a share purchase contract and
either a debt security or a debt obligation of a third party,
including a U.S. Treasury security. The debt security or debt
obligation of a third party may serve as collateral to secure the
holders' obligations to purchase the common shares under the share
purchase contracts. The share purchase contracts may require us to
make periodic payments to the holders of share purchase contracts.
These payments may be unsecured or prefunded on some basis. The share
purchase contracts may require holders to secure their obligations in
a specified manner. The applicable prospectus supplement will describe
the specific terms of any share purchase contracts or share purchase
units.
DESCRIPTION OF DEPOSITARY SHARES
The descriptions below and in any prospectus supplement regarding
provisions of any deposit agreement, depositary shares and depositary
receipts are qualified by reference to the forms of deposit agreement
and depositary receipts relating to each series of preferred shares
which are filed or incorporated by reference as exhibits to the
registration statement.
GENERAL
We may, at our option, elect to offer fractional interests in
preferred shares instead of whole preferred shares. In that event, we
expect to provide for the issuance by a depositary of receipts for
depositary shares, each of which will represent a fractional interest
in preferred shares of a particular series, as described in the
prospectus supplement.
We will deposit any series of preferred shares underlying the
depositary shares under a separate deposit agreement between us, a
depositary of our selection that is a bank or trust company whose
principal office is in the United States and which has a combined
capital and surplus of at least $50,000,000, and the holders of the
depositary shares. The prospectus supplement will show the name and
address of the depositary. Subject to the terms of the deposit
agreement, each holder of depositary shares will be entitled, in
proportion to the applicable fractional interest in the preferred
shares underlying the depositary shares, to the rights and preferences
29
of the underlying preferred shares, including any dividend, voting,
redemption, conversion, exchange and liquidation rights.
The depositary shares will be evidenced by depositary receipts
issued under the deposit agreement. Depositary receipts will be
distributed to those persons purchasing the fractional interests in
the related series of preferred shares, as described in the prospectus
supplement.
DIVIDENDS AND OTHER DISTRIBUTIONS
Whenever the depositary receives any cash dividend or other cash
distribution on the preferred shares, except cash received upon their
redemption, the depositary will distribute those amounts to the record
holders of the depositary receipts in proportion to the number of
depositary shares evidenced by the depositary receipts. The
depositary will not attribute to any holder of depositary shares a
fraction of one cent. The depositary will hold, without liability for
interest, any balance not distributed. This balance will be treated
as part of the next sum received by the depositary for distribution to
the record holders of the depositary receipts.
In a distribution on the preferred shares other than in cash, the
depositary will distribute amounts of the property received to the
record holders of depositary receipts, in proportion to the number of
depositary shares evidenced by the depositary receipts. If the
depositary determines, after consulting us, that this distribution
cannot be made proportionately among the holders or otherwise is not
feasible, the depositary may, with our approval, sell the property and
distribute the net proceeds to these holders instead.
The deposit agreement also will contain provisions about the
manner that any subscription or similar rights offered by us to
holders of the preferred shares will be made available to the holders
of depositary receipts.
REDEMPTION OF DEPOSITARY SHARES
If a series of preferred shares underlying the depositary shares
is subject to redemption, the depositary will use the proceeds
received from the redemption of preferred shares it holds to redeem
the corresponding depositary shares. The depositary will mail notice
of redemption at least 30 but not more than 60 days before the
redemption date to the record holders of the depositary receipts at
their addresses appearing in its books. The redemption price per
depositary share being redeemed will be equal to the applicable
fraction of the redemption price per share payable with respect to the
preferred shares being redeemed. When we redeem preferred shares held
by the depositary, the depositary will redeem as of the same
redemption date the number of depositary shares relating to the
preferred shares redeemed. If not all of the depositary shares are to
be redeemed, the depositary shares to be redeemed will be selected by
lot or pro rata, as Arvin may determine.
After the redemption date, the depositary shares called for
redemption will no longer be deemed to be outstanding and all rights
of the holders of the depositary shares, except the right to receive
the redemption price, will cease and terminate.
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VOTING THE PREFERRED SHARES
Upon receipt of notice of any meeting at which the holders of the
preferred shares are entitled to vote, the depositary will mail the
information in this notice of meeting to the record holders of the
depositary receipts. Upon the written request of a holder of a
depositary receipt on that record date, the depositary will, to the
extent practicable, vote or cause to be voted the amount of preferred
shares represented by that holder's depositary shares according to the
instructions in this request. Without specific instructions from the
holder of a depositary receipt, the depositary will not vote the
preferred shares represented by the depositary shares evidenced by the
depositary receipt.
AMENDMENT AND TERMINATION OF DEPOSITARY AGREEMENT
The form of depositary receipt and any provision of the deposit
agreement may be amended by agreement between Arvin and the
depositary. However, any amendment which:
- materially and adversely alters the rights of the existing
holders of depositary shares, or
- would be materially and adversely inconsistent with the rights
granted to the holders of preferred shares
requires approval by the holders of at least a majority of the
depositary shares then outstanding.
We may terminate a deposit agreement on at least 30 days' notice
to the depositary. In this case, upon surrender of depositary
receipts, the depositary will distribute to the holders the whole
number of preferred shares represented by the receipts surrendered.
The deposit agreement will terminate automatically upon:
- the redemption or conversion of all outstanding depositary
shares;
- the conversion or exchange into common shares or other
securities of each underlying preferred share, if applicable;
or
- the final distribution in respect of the underlying preferred
shares in connection with any liquidation, dissolution or
winding up of Arvin, which has been distributed to the holders
of the related depositary shares.
CHANGES OF DEPOSITARY
At any time, the depositary may resign by notice to Arvin, or
Arvin may remove the depositary. The resignation or removal of the
depository will take effect upon the appointment of and the acceptance
by a successor depositary. The successor depositary must be appointed
within 60 days after the notice of resignation or removal and must be
a bank or trust company whose principal office is in the United States
and which has a combined capital and surplus of at least $50,000,000.
If a successor depositary is not appointed within 60 days, the
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resigning or removed depositary may petition a court to appoint a
successor depositary.
MISCELLANEOUS
We will pay all transfer and other taxes and governmental charges
arising solely from the depositary arrangements. We will pay charges
of the depositary for the initial deposit of the preferred shares and
any redemption of preferred shares. Holders of depositary shares will
pay transfer and other taxes and governmental charges and other
charges that the deposit agreement expressly provides are for their
accounts.
The depositary will forward to the holders of depositary receipts
all reports and notices received from Arvin and which Arvin must
furnish to the holders of the preferred shares.
Neither the depositary nor Arvin will be liable if it is
prevented or delayed by law or any circumstances beyond its control in
performing its obligations under the deposit agreement. The
obligations of Arvin and the depositary under the deposit agreement
will be limited to performance in good faith of their duties. Neither
Arvin nor the depositary will be obligated to prosecute or defend any
legal proceeding in respect of any depositary shares or preferred
shares unless satisfactory indemnity is furnished. Arvin and the
depositary may rely upon written advice of counsel or accountants, or
information provided by persons believed to be competent and on
documents believed to be genuine.
DESCRIPTION OF WARRANTS
We may issue warrants, including debt warrants, which are
warrants to purchase debt securities, and equity warrants, which
include warrants to purchase common shares, preferred shares or
depositary shares. We may issue warrants independently of or together
with any other securities, and warrants may be attached to or separate
from those securities. Each series of warrants will be issued under a
separate warrant agreement to be entered into between Arvin and a
warrant agent. The warrant agent will act solely as our agent in
connection with a series of warrants and will not assume any
obligation or relationship of agency for or with holders or beneficial
owners of warrants. The following describes the general terms and
provisions of the warrants offered by this prospectus. The applicable
prospectus supplement will show any other terms of the warrant and the
applicable warrant agreement.
DEBT WARRANTS
The applicable prospectus supplement will describe the terms of
any debt warrants, including the following:
- the title and aggregate number of the debt warrants;
- any offering price of the debt warrants;
- whether the debt warrants are to be issued with any debt
securities and, if so, the title, total principal amount and
terms;
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- the number of debt warrants to be issued with each principal
amount;
- any date on and after the debt warrants and debt securities
will be separately transferable;
- the title, total principal amount, ranking and terms,
including subordination and conversion provisions, of the
underlying debt securities that may be purchased upon
exercise of the debt warrants;
- the time or period of when the debt warrants are
exercisable, the minimum or maximum amount of debt warrants
which may be exercised at any one time, and the final date
on which the debt warrants may be exercised;
- the principal amount of underlying debt securities that may
be purchased upon exercise of each debt warrant and the
price, or the manner of determining the price, at which the
principal amount may be purchased upon exercise;
- the terms of any right to redeem or call the debt warrants;
- any book-entry procedure information;
- any currency or currency units in which the offering price
and the exercise price are payable;
- if applicable, a discussion of U.S. federal income tax
considerations; and
- any other terms of the debt warrants not inconsistent with
the provisions of the debt warrant agreement.
EQUITY WARRANTS
The applicable prospectus supplement will describe the terms of
any equity warrants, including the following:
- the title and aggregate number of the equity warrants;
- any offering price of the equity warrants;
- the designation and terms of any preferred shares that are
purchasable upon exercise of the equity warrants or that
underlie depositary shares purchasable upon this exercise;
- if applicable, the designation and terms of the securities
with which the equity warrants are issued and the number of
the equity warrants issued with each security;
- if applicable, the date from and after the equity warrants
and any securities issued with them will be separately
transferrable;
- the number of common shares, preferred shares or depositary
shares purchasable upon exercise of an equity warrant and
the price;
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- the time or period when the equity warrants are exercisable
and the final date on which the equity warrants may be
exercised and terms regarding any right of Arvin to
accelerate this final date;
- if applicable, the minimum or maximum amount of the equity
warrants exercisable at any one time;
- any currency or currency units in which the offering price
and the exercise price are payable;
- any applicable anti-dilution provisions of the equity
warrants;
- if applicable, a discussion of U.S. federal income tax
considerations;
- any applicable redemption or call provisions; and
- any additional terms of the equity warrants not inconsistent
with the provisions of the equity warrant agreement.
PLAN OF DISTRIBUTION
We may sell the securities:
- through underwriting syndicates represented by one or more
managing underwriters,
- through one or more firms acting as underwriters,
- through dealers or agents, or
- directly to investors.
The prospectus supplement with respect to the securities will
describe the terms of the offering, the purchase price of the
securities and the proceeds to us from the sale, any underwriters,
dealers or agents, any delayed delivery arrangements, any fees,
underwriting discounts and other underwriters' compensation. Any
initial public offering price and any discounts or concessions allowed
or reallowed or paid to dealers may change.
If the sale of securities involves underwriters, the underwriters
will acquire the securities for their own account and resell them in
one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the
time of sale. The cover of the prospectus supplement will name the
underwriter or underwriters or managing underwriters or underwriters,
with respect to an underwriting syndicate, for a particular
underwritten offering. Except as the prospectus supplement indicates,
the obligations of the underwriters to purchase the securities will be
subject to conditions precedent. The underwriters will be obligated
to purchase all the securities offered by the prospectus supplement if
any are purchased.
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If the sale of securities involves dealers, we will sell the
securities to the dealers as principals. The dealers then may resell
the securities to the public at varying prices to be determined by the
dealers at the time of resale. The prospectus supplement will name
the dealers and describe the terms of the transaction.
The prospectus supplement will name any agent involved in the
offer or sale of the securities and will indicate any commissions
payable by Arvin to that agent. Unless the prospectus supplement
states otherwise, any agent will be acting on a best efforts basis for
the period of its appointment.
We will sell the securities directly to institutional investors or
others, who may be deemed to be underwriters within the meaning of the
Securities Act of 1933 with respect to any resale. The prospectus
supplement will describe the terms of any of those sales.
We also may sell the securities in connection with a remarketing
upon their purchase, in connection with a redemption or repayment, by
a remarketing firm acting as principal for its own account or as our
agent. Remarketing firms may be deemed to be underwriters in
connection with the securities that they remarket.
If the prospectus supplement indicates, we will authorize agents,
underwriters or dealers to solicit offers from institutions to
purchase securities from us at the public offering price indicated in
the prospectus supplement through delayed delivery contracts providing
for payment and delivery on a specified date in the future. The
prospectus supplement will specify the conditions of these contracts
and the commission payable for solicitation of the contracts.
Agents, dealers and underwriters may be entitled under agreements
with Arvin to indemnification by Arvin against civil liabilities,
including those under the Securities Act, or to contribution with
respect to those payments that agents, dealers or underwriters may be
required to make. Agents, dealers and underwriters may be customers
of, engage in transactions with, or perform services for Arvin in the
ordinary course of business.
Other than the common shares, which will be approved for listing
upon notice of issuance on the New York Stock Exchange and the Chicago
Stock Exchange, the securities may or may not be listed on a national
securities exchange. There is no assurance that a market for the
securities will exist.
LEGAL OPINIONS
Schiff Hardin & Waite, Chicago, Illinois, will pass upon the
validity of the securities offered by this prospectus for Arvin. The
opinions with respect to the securities may be subject to assumptions
regarding future action to be taken by Arvin and the applicable
trustee, depositary or warrant agent in connection with the issuance
and sale of particular securities, the specific terms of the
securities and other matters that may affect the validity of
securities but that cannot be ascertained on the date of those
opinions.
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EXPERTS
The financial statements incorporated in this Prospectus by
reference to the Annual Report on Form 10-K of Arvin Industries, Inc.
for the year ended January 3, 1999 have been so incorporated in
reliance on the report of PricewaterhouseCoopers LLP, independent
accountants, given on the authority of said firm as experts in
auditing and accounting.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following statement indicates the estimated amounts of
expenses to be borne by Arvin in connection with the offering
described in this registration statement:
Securities and Exchange Commission registration fee............. $ 111,200
Trustee's fees and expenses..................................... 20,000
Printing and engraving expenses................................. 75,000
Rating agency fees.............................................. 150,000
Accounting fees and expenses.................................... 50,000
Legal fees and expenses......................................... 50,000
Blue sky fees and expenses...................................... 20,000
Miscellaneous expenses.......................................... 23,800
-----------
Total ........................................................ $ 500,000
-----------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article 8 of the Amended and Restated By-Laws of Arvin, as
amended, and Article 10 of its Restated Articles of Incorporation, as
amended, both provide for indemnification of officers and directors of
Arvin against expenses incurred by any of them in certain stated
proceedings and under certain stated conditions.
Chapter 37 of the Indiana Business Corporation Law authorizes
every Indiana corporation to indemnify its officers and directors
under certain circumstances against liability incurred in connection
with the defense of proceedings in which they are made parties, or
threatened to be made parties, by reason of such relationship to the
corporation, except where they are adjudged liable for specific types
of negligence or misconduct in the performance of their duties to the
corporation. Chapter 37 also requires every Indiana corporation to
indemnify any of its directors and, unless such corporation's articles
of incorporation provide otherwise, any of its officers who were
wholly successful, on the merits or otherwise, in the defense of any
such proceeding against reasonable expenses incurred by such director
in connection with such proceeding.
Officers and directors of Arvin are presently covered by insurance
which (with certain exceptions and within certain limitations)
indemnifies them against any losses or liabilities arising from any
alleged "wrongful act," including any breach of duty, neglect, error,
misstatement, misleading statement, omission or other acts done or
wrongfully attempted.
Section 7 of the form of Underwriting Agreement filed as Exhibit
1-1 hereto provides for indemnification by the Underwriters of
officers and directors of Arvin in certain circumstances.
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ITEM 16. EXHIBITS.
1-1* Form of Underwriting Agreement.
3-1 Amended and Restated Articles of Incorporation and
amendments thereto (incorporated by reference to Exhibit
3(A) to Arvin's Form 10-K for its fiscal year ended December
30, 1990).
3-2 Amended and Restated By-Laws (incorporated by reference to
Exhibit 3(ii) to Arvin's Form 8-K dated May 10, 1996).
4-1 Amended and Restated Articles of Incorporation and
amendments thereto (See Exhibit 3-1).
4-2 Amended and Restated By-laws (See Exhibit 3-2).
4-3 Rights Agreement between the Company and Harris Trust and
Savings Bank, as amended (incorporated by reference to
Arvin's Current Report on Form 8-K dated May 10, 1996,
Arvin's Current Report on Form 8-K dated June 16, 1986 and
Arvin's Current Report on Form 8-K dated February 28, 1989).
4-4 Indenture, dated as of July 3, 1990, between Arvin and
Harris Trust and Savings Bank, as trustee, as amended by
First Supplemental Indenture dated as of March 31, 1994,
relating to the senior debt securities (incorporated by
reference to Exhibit 4-4 to Arvin's Registration Statement
on Form S-3, no. 33-53087).
4-5 Form of Indenture to be entered into between Arvin and a
trustee to be identified, relating to the subordinated debt
securities.
4-6 Form of Deposit Agreement, including form of depositary
receipt for depositary shares (incorporated by reference to
Exhibit 4-6 to Arvin's Registration Statement on Form S-3,
no. 33-53087).
4-7 Form of debt warrant agreement (incorporated by reference to
Exhibit 4-7 to Arvin's Registration Statement on Form S-3,
no. 33-53087).
4-8 Form of equity warrant agreement (incorporated by reference
to Exhibit 4-8 to Arvin's Registration Statement on Form S-
3, no. 33-53087).
4-9* Form of Purchase Contract Agreement.
4-10* Form of Pledge Agreement.
4-11* Form of Remarketing Agreement.
5-1* Opinion of Schiff Hardin & Waite.
12-1 Computation of Ratios of Earnings to Fixed Charges and
Earnings to Combined Fixed Charges and Preferred Dividends
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(incorporated by reference to Exhibit 12 to Arvin's Form 10-
K for its fiscal year ended January 3, 1999).
23-1 Consent of PricewaterhouseCoopers LLP.
23-2 Consent of Schiff Hardin & Waite (to be included in Exhibit
5-1).
24-1 Power of Attorney is included below, beginning immediately
prior to "Signatures.
25-1 Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939 of trustee for senior
indenture.
-------------------
* To be filed by amendment.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation from the low or high end
of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement; and
(iii) to include any material information with respect
to the plan of distribution not previously
disclosed in the registration statement or any
material change to such information in the
registration statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
39
amendment by those paragraphs is contained in periodic reports filed
with or furnished to the Commission by the registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) that, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) to remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934
(and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer, or controlling person in connection with the
securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
of whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of
such issue.
(d) The undersigned registrant hereby undertakes to file an
application for the purpose of determining the eligibility of the
trustee to act under subsection (a) of Section 310 of the Trust
Indenture Act in accordance with the rules and regulations prescribed
by the Commission under Section 305(b)(2) of the Trust Indenture Act.
POWER OF ATTORNEY
Each person whose signature appears below appoints V. William
Hunt, Ronald R. Snyder and Richard A. Smith, or any of them, as such
person's true and lawful attorney-in-fact and agent, to sign, in the
name of each such person, and file any amendments (including post-
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effective amendments) to this registration statement that any of such
attorneys-in-fact shall deem necessary or advisable, which amendments
may make such changes in such registration statement as any of the
above-named attorneys-in-fact deems appropriate, together with all
exhibits thereto and all documents in connection therewith, with the
Securities and Exchange Commission; and to sign, in the name of each
such person, and file any registration statement for the same offering
covered by this registration statement that is to be effective upon
filing pursuant to Rule 462 promulgated under the Securities Act of
1933, and all post-effective amendments thereto, together with all
exhibits thereto and all documents in connection therewith, with the
Securities and Exchange Commission; and each of the undersigned hereby
ratifies all that any of said attorneys-in-fact and agents shall do or
cause to be done by virtue thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Columbus, State
of Indiana, on this 3rd day of May, 1999.
ARVIN INDUSTRIES, INC.
By: /s/ V. William Hunt
---------------------------------
V. William Hunt
Chairman, President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
SIGNATURE TITLE DATE
----------------------------- ------------------------ ------------------
/s/ V. William Hunt Chairman, President, Chief
------------------------------ Executive Officer and Director May 3, 1999
V. William Hunt
/s/ Richard A. Smith Vice President-Finance, Chief
------------------------------ Financial Officer and Director February 11, 1999
Richard A. Smith
/s/ William M. Lowe, Jr. Controller and Chief
------------------------------ Accounting Officer February 11, 1999
William M. Lowe, Jr.
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/s/ Joseph P. Allen
------------------------------ Director February 11, 1999
Joseph P. Allen
/s/ Steven C. Beering
------------------------------ Director February 11, 1999
Steven C. Beering
/s/ Joseph P. Flannery
------------------------------ Director February 11, 1999
Joseph P. Flannery
/s/ Robert E. Fowler
------------------------------ Director May 3, 1999
Robert E. Fowler
/s/ William D. George
------------------------------ Director February 11, 1999
William D. George
/s/ Ivan W. Gorr
------------------------------ Director February 11, 1999
Ivan W. Gorr
/s/ Richard W. Hanselman
------------------------------ Director February 11, 1999
Richard W. Hanselman
/s/ Don J. Kacek
------------------------------ Director February 11, 1999
Don J. Kacek
/s/ Frederick R. Meyer
------------------------------ Director February 11, 1999
Frederick R. Meyer
/s/ Arthur R. Velasquez
------------------------------ Director February 11, 1999
Arthur R. Velasquez
/s/ Carolyn Y. Woo
------------------------------ Director May 3, 1999
Carolyn Y. Woo
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