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EXHIBIT 10
November 6, 2000
Mr. Prakash R. Mulchandani
2364 Collins Drive
Worthington, OH 43085
Dear Prakash:
Subject: Mutually Agreed Upon Separation
This letter confirms the substance of our conversations over the past few weeks
regarding a mutually agreed upon separation between you and the Company. We
emphasize that your acceptance of this agreement is completely voluntary.
ArvinMeritor agrees to provide you the following:
1. You will continue to support the Office of the Chairman for the
balance of calendar year 2000.
2. Beginning January 1, 2001, through February 28, 2003, you will receive
separation pay equal to twenty six months of pay (at your current
compensation), spread equally over the above separation period. The
above separation period is inclusive of unused vacation for calendar
year 2000.
3. You will be eligible to receive incentive compensation plan (ICP)
payments for fiscal year 2000 and a prorated payment for the time
worked (three months out of 12 months) in fiscal year 2001. Such
payments will be made under applicable formulas. Final award
determination, if any, is subject to Board of Directors' approval.
4. You will be eligible to receive long term incentive plan (LTIP)
payments based on your grant letters for FY1998-2000, FY1999-2001 and
FY2000-2002 plan years as follows:
- FY1998-2000 LTIP will be paid in December, 2000, pending Board of
Directors' approval based on the applicable formulas.
- FY1999-2001 LTIP will be paid in December, 2001, pending Board of
Directors' approval, based on the applicable formulas on a
prorated basis (27 months out of 36 months).
- FY2000-2002 LTIP will be paid in December, 2002, pending Board of
Directors' approval based on the applicable formulas on a
prorated basis (15 months out of 36 months).
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Prakash R. Mulchandani
November 6, 2000
Page Two
- Upon your termination date of February 28, 2003, you will receive
immediate vesting of all outstanding stock options. We will
extend the time to exercise your stock options three years
(February 28, 2006), which is not beyond the expiration date
specified in any grants. If you elect to retire upon the
termination date of February 28, 2003 or before, your stock
options will vest and become exercisable in accordance with the
Long Term Incentives Plan provisions.
5. Your present Company vehicle may be driven at Company expense through
your separation period until February 28, 2003, at which time you may
purchase it at its book or wholesale value, whichever is less.
6. You will continue to be provided financial counseling reimbursement at
your current annual rate until February 28, 2003.
7. Short and long term disability coverage will be in effect through
December 31, 2000.
8. Medical, dental, life insurance and AD&D coverage will remain in force
through February 28, 2003. Based upon your age at that time, you will
be eligible to retire. Your continuation of coverage options will
depend upon your decision regarding retirement and are summarized
below.
If you elect to retire at that point:
You will be eligible for retiree medical and life insurance coverage
based upon the terms of the program in place at that time. Details of
the current premium requirements can be found in the Salaried Service
Based Retirees and Surviving Spouses Health & Welfare Benefits Program
Summary Plan Description. You will be entitled to continue your dental
coverage at your own expense for a period of up to eighteen months
under COBRA. If you have Aetna universal life insurance. it may be
converted to an individual policy. AD&D coverage will terminate.
If you do not elect to retire at that point:
You will be entitled to continue your medical and dental coverage at
your own expense for a period of up to eighteen months under COBRA. If
you have Aetna universal life insurance it may be converted to an
individual policy. AD&D coverage will terminate. When you ultimately
elect to retire you will be eligible for retiree medical and life
insurance coverage based upon the terms of the program in place at
that time.
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Prakash R. Mulchandani
November 6, 2000
Page Three
9. You will receive Company sponsored outplacement assistance from the
outplacement firm of your choice under the executive management
program.
10. You will be eligible to continue to participate in the Company savings
plan through February 28, 2003. If you wish to change your
contribution level or change the direction of your investments, you
will need to call T. Rowe Price at 1-800-922-9945.
11. Based on your age and credited service with Meritor and its
predecessor, you will have met the early retirement requirements under
the Meritor and Rockwell Retirement Plans as of the end of your
separation period. You can elect to retire at any time and will be
able to do so by contacting the Meritor Retirement Center at
1-888-869-3772 and the Rockwell Retirement Center at 1-800-236-3071.
12. Your compensation checks will be mailed to your home or direct
deposited unless you specify otherwise. Please let us know in writing
if you change your address.
13. You will keep confidential and not disclose to any other person other
than your spouse, accountant, financial advisor and/or attorney the
existence of this agreement, its substance or any discussions or
information relating to it.
14. You also agree to and hereby release and waive any and all claims and
rights you may have or may believe you have against ArvinMeritor, its
officers, directors, employees or agents relating to or arising out of
your employment or your separation including any claim or right in
contract, tort and based on or arising under any federal or state
statutes, including the Age Discrimination in Employment Act. You
shall refrain from making disparaging comments about the Company
and/or its management. This agreement does not extend to your rights
under any retirement benefit plan of ArvinMeritor or other future
rights.
15. ArvinMeritor shall have the right to terminate this agreement at any
time if you materially breach any of the obligations stated herein
under this agreement.
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Prakash R. Mulchandani
November 6, 2000
Page Four
16. You acknowledge that you have been advised to consult with an attorney
prior to signing this agreement. You also acknowledge, understand and
agree that this agreement is voluntarily entered into by you in
consideration of the undertakings by ArvinMeritor as set forth herein
and is consistent in all respect with the discussions by ArvinMeritor
personnel with you relating to your separation.
17. Based upon your departure from the Company, you agree for a period of
thirty-six months following the date of your departure (December 31,
2000) that you will not solicit for employment any other ArvinMeritor
employee or to join or start a business that competes with
ArvinMeritor's Commercial Vehicle Systems business unit. You also
agree that you will not disclose, nor will you use any ArvinMeritor
proprietary information.
18. This agreement is a complete and final agreement between ArvinMeritor
and its successors and Prakash R. Mulchandani, and supercedes all
other offers, agreements, and negotiations except for the Invention
Assignment Agreement which remains in full force.
19. You will have until December 5, 2000, in which to consider this final
agreement, and you may revoke this agreement within seven days of
signing. This agreement will not become effective until the revocation
period has expired.
Sincerely,
Gary L. Collins
Senior Vice President
Human Resources
cc: L. D. Yost Accepted and agreed to:
V. W. Hunt
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Prakash R. Mulchandani
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Date
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November 21, 2000
Mr. Prakash R. Mulchandani
2364 Collins Drive
Worthington, OH 43085
Dear Prakash:
The purpose of this letter is to supplement and amend my letter to you dated
November 6, 2000 ("Separation Letter"), in which we set out the conditions
regarding your separation of employment with ArvinMeritor Inc.
Paragraph 19 of the Separation Letter is amended as follows:
19. You will have until December 5, 2000, in which to consider this final
agreement, and you may revoke this agreement within seven days of signing.
This agreement will not become effective until the revocation period has
expired.
As we discussed on November 21, 2000, we agreed to add the following paragraphs
to the Separation Letter:
20. You will be reimbursed any legal fees incurred in connection with enforcing
this agreement.
21. You will continue your company sponsored country club membership
eligibility through your separation period until February 28, 2003, at
which time you may retain the membership by reimbursing the company for its
equity interest in the club.
22. You will continue to accrue credited service under the Pension Plan through
your separation period.
Except as noted above, this letter does not supercede the Separation Letter in
any way.
Sincerely, Accepted and Agreed to:
Gary L. Collins ----------------------------------- ---------------
Senior Vice President Prakash R. Mulchandani Date
Human Resources
cc: L. D. Yost
V. W. Hunt
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December 4, 2000
Mr. Prakash R. Mulchandani
2364 Collins Drive
Worthington, OH 43085
Dear Prakash:
The purpose of this letter is to supplement and amend my letter to you dated
November 6, 2000 ("Separation Letter"), in which we set out the conditions
regarding your separation of employment with ArvinMeritor Inc.
Paragraph 17 of the Separation Letter is hereby amended as follows:
23. Based upon your departure from the Company, you agree for a period of
thirty-six months following the date of your departure (December 31, 2000)
that you will not solicit for employment any other ArvinMeritor employee or
to join or start a business that competes with ArvinMeritor's Commercial
Vehicle Systems business unit. Notwithstanding the foregoing, the specific
companies that would be deemed as competing against ArvinMeritor's
Commercial Vehicle Systems business unit are:
Powertrain; Eaton; Dana; Hendrickson; Dirona; American Axle;
Knorr Bremsen; and ZF
In the event there is any question as to direct or indirect competition,
you agree to obtain approval from ArvinMeritor in writing prior to
commencement of employment with the company which could be in competition.
You also agree that you will not disclose, nor will you use any
ArvinMeritor proprietary information.
Except as noted above, this letter does not supercede the Separation Letter in
any way.
Sincerely, Accepted and Agreed to:
Gary L. Collins ----------------------------------- ---------------
Senior Vice President Prakash R. Mulchandani Date
Human Resources
cc: L. D. Yost
V. W. Hunt