SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001
COMMISSION FILE NO. 1-15983
ARVINMERITOR, INC. SAVINGS PLAN
(Full title of the plan)
ARVINMERITOR, INC.
2135 WEST MAPLE ROAD
TROY, MICHIGAN 48084
(Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office)
Table of Contents
Independent Auditors' Report 1
Financial Statements:
Statements of Net Assets Available for Benefits
as of December 31, 2001 and 2000 2
Statements of Changes in Net Assets Available
For Benefits for the Year Ended December 31, 2001 3
Notes to Financial Statements 4-8
Supplemental Schedules as of and for the
Year ended December 31, 2001:
Schedule of Assets Held at End of Year 9
Schedule of Reportable Transactions 10
Signatures 11
Exhibit:
Independent Auditors' Consent 12
INDEPENDENT AUDITORS' REPORT
To the ArvinMeritor, Inc. Savings Plan and to Participants therein:
We have audited the accompanying statements of net assets available for benefits
of the ArvinMeritor, Inc. Savings Plan (formerly the Meritor Automotive, Inc.
Savings Plan) (the "Plan") as of December 31, 2001 and 2000 and the related
statement of changes in net assets available for benefits for the year ended
December 31, 2001. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2001 and 2000, and the changes in net assets available for benefits for the year
ended December 31, 2001 in conformity with accounting principles generally
accepted in the United States of America.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
listed in the table of contents are presented for the purpose of additional
analysis and are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These supplemental schedules are the responsibility of the
Plan's management. The supplemental schedules have been subjected to the
auditing procedures applied in our audit of the basic December 31, 2001
financial statements and, in our opinion, are fairly stated in all material
respects when considered in relation to the basic financial statements taken as
a whole.
DELOITTE & TOUCHE LLP
Detroit, Michigan
June 26, 2002
ARVINMERITOR, INC. SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 2001 AND 2000
---------------------------------------------------------------
2001 2000
---- ----
ASSETS:
Investments (Note 3) $196,077,033 $ 44,009,675
Due from other plans (Note 1) - 118,779,710
------------ ------------
TOTAL ASSETS 196,077,033 162,789,385
LIABILITIES - Accrued expenses 85,083 56,860
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $195,991,950 $162,732,525
============ ============
See accompanying notes to financial statements.
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ARVINMERITOR, INC. SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2001
--------------------------------------------------------------
Year Ended
December 31, 2001
-----------------
ADDITIONS:
Employee contributions $ 21,607,955
Employer contributions 10,689,464
-------------
32,297,419
Net appreciation
in fair value of investments (Note 3) 11,691,200
Dividends and interest 5,851,987
Transfers in (Note 1) 4,603,090
-------------
Total additions 54,443,696
DEDUCTIONS:
Benefits paid to participants (20,774,040)
Administrative expenses (410,231)
-------------
Total deductions (21,184,271)
Net additions 33,259,425
NET ASSETS AVAILABLE FOR PLAN BENEFITS,
beginning of year 162,732,525
-------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS,
end of year $ 195,991,950
=============
See accompanying notes to financial statements.
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ARVINMERITOR, INC. SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2001
--------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN
The following general description of the ArvinMeritor, Inc. Savings
Plan (formerly the Meritor Automotive, Inc. Savings Plan) (the "Plan"), as in
effect at December 31, 2001, is provided for general information purposes only.
Participants should refer to the Plan document for more complete information.
GENERAL - The Plan was established October 1, 1997. The Plan is a
defined contribution savings plan covering all eligible employees of
ArvinMeritor, Inc. and certain affiliated companies (the "Company"). Eligible
employees may participate in the Plan immediately on the date on which the
individual becomes an employee. The Plan is administered by the Company's
Employee Benefit Plan Committee and the Plan Administrator. The Trustee for the
Plan assets is T. Rowe Price Trust Company. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974.
On July 7, 2000, Meritor Automotive, Inc. merged with Arvin Industries,
Inc. to become ArvinMeritor, Inc. ("ArvinMeritor"). The new company,
ArvinMeritor, Inc., is now the Plan sponsor and administrator.
On December 31, 2000, all or a portion of four plans were merged into
the Plan: Meritor Heavy Vehicle Braking Systems Salaried Savings Plan, Arvin
Savings Plan, Euclid Industries 401(k) Plan and the Euclid Industries, Inc.
Profit Sharing Plan. This has been reflected as a receivable due from other
plans on the statement of net assets available for benefits at December 31,
2000. Effective January 1, 2001, the name of the Plan was changed from the
Meritor Automotive, Inc. Savings Plan to the ArvinMeritor, Inc. Savings Plan.
For the year ended December 31, 2001, various transfers to the Plan
occurred as a result of additional employees being transferred from the
ArvinMeritor, Inc. Hourly Employees Savings Plan. These have been reflected as
transfers in on the Statement of Changes in Net Assets.
CONTRIBUTIONS - Eligible employees may elect to contribute up to 20% of
their base compensation, by electing to defer receipt of compensation (pre-tax
contribution) or authorizing deductions from compensation (after-tax
contribution). Participants can elect to have their contributions invested in 5%
increments in various investment funds.
The participants are immediately eligible for matching contributions.
The Company matches 100% of the participant's contribution up to the first 3% of
eligible compensation and 50% of the participant's contribution on the next 3%
of eligible compensation. Company contributions may be in the form of
ArvinMeritor common stock or cash invested in ArvinMeritor common stock. The
Company match for employees in a joint venture is payable in cash.
VESTING - Amounts attributable to participant contributions and Company
contributions are fully vested at all times.
PLAN WITHDRAWALS - Amounts contributed may be withdrawn by, or
distributed to, a participant only upon (1) termination of employment or
(2) attaining the age of 59 1/2. Withdrawals prior to
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attaining age 59 1/2 are not permitted except in the event of retirement,
disability or as a hardship distribution. Certain income tax penalties may apply
to withdrawals or distributions prior to age 59 1/2.
PAYMENT OF BENEFITS - On termination of service due to death,
disability or retirement, a participant generally receives an amount equal to
the value of the participant's vested interest in their account in a lump-sum
amount. For termination of service due to other reasons, a participant may
receive the value of the vested interest in their account as a lump-sum
distribution.
LOANS TO PARTICIPANTS - Participants may borrow from the Plan an amount
not less than $1,000 and not greater than the lesser of (i) $50,000 less the
amount of loans outstanding during the preceding 12-month period, (ii) amounts
in the participant's account attributable to participant contributions, or
(iii) one-half of the participant's vested account balance.
Interest is charged at 1% over the prime rate, which is defined as the
base rate on corporate loans posted by at least 75% of the 30 largest U.S.
banks. The loans are repaid through payroll deductions over periods generally
not to exceed 60 months. Payments of principal and interest are reinvested under
the participant's current investment election for new contributions.
GUARANTEED INVESTMENT CONTRACTS AND COMMON TRUST FUND - The prior
Stable Value Fund (discontinued April 1, 1999) held two guaranteed investment
contracts. These funds were to remain so invested until expiration of the
contracts or an interest guarantee under those contracts. These contracts
guarantee the principal and fixed interest thereon for a specified period of
time and accrue such fixed interest on a monthly basis. One of the two contracts
expired on March 31, 2000 and the funds were reinvested in the Stable Value
Common Trust Fund. The remaining guaranteed investment contract expired on April
2, 2001 and was also reinvested in the Stable Value Common Trust Fund.
The detail of the contract outstanding at December 31, 2000 is as
follows.
GUARANTEED
ISSUING PERIODS OF ANNUAL MATURITY CONTRACT VALUE AT
COMPANY CONTRIBUTION RETURN DATE DECEMBER 31, 2000
Prudential April 1, 1998 - 5.82% April 2, 2001 $ 454,149
March 31, 1999
The crediting interest rate for the guaranteed investment contracts
equals the guaranteed annual return for the year ended December 31, 2001 and the
three months ended December 31, 2000.
PARTICIPANT ACCOUNTS - Each participant's account is credited with the
participant's contribution and an allocation of the Company's contribution and
Plan earnings and charged with an allocation of administrative expenses.
Allocations are based on a participant's earnings or account balances as
defined. The benefit to which a participant is entitled is the benefit that can
be provided from the participant's vested account.
PLAN TERMINATION - Although the Company has not expressed any intent to
terminate the Plan, it reserves the right to do so at any time.
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The financial statements of the Plan are prepared
under the accrual method of accounting.
INVESTMENT VALUATION - Investments, other than benefit-responsive
investment contracts, are stated at fair value as measured by readily available
market prices. The T. Rowe Price Stable Value Common Trust Fund is comprised of
individual investment contracts, including synthetic investment contracts and
are stated at contract value. The investment contracts are nontransferable, but
provide for benefit-responsive withdrawals by plan participants at contract
value. Benefit-responsive withdrawals are provided for on a proportional basis
by the issuers of the investment contracts. The trustee's valuation committee
primarily considers factors such as the benefit responsiveness of the investment
contract and the ability of the parties to the investment contract to perform in
accordance with the terms of the contract. Generally, contract value
approximates fair value (contributions made plus interest accrued at the
contract rate, less withdrawals and fees). If, however an event has occurred
that may impair the ability of the contract issuer to perform in accordance with
the contract term, fair value may be less than the contract terms.
SECURITY TRANSACTIONS AND INVESTMENT INCOME - Purchases and sales of
securities are reported on a trade date basis. Dividends are recorded on the
ex-dividend date and interest income is recorded on the accrual basis.
PLAN EXPENSES - Administrative expenses of the Plan are paid by the
Plan or the Company, as provided by the Plan document.
BENEFIT PAYMENTS - Benefits are recorded when paid.
USE OF ESTIMATES - The preparation of financial statements in
conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and changes therein, and disclosure
of contingent assets and liabilities. Actual results could differ from those
estimates. The Plan utilizes various investments, which are exposed to various
risks such as interest rate, credit and overall market volatility. Due to the
level of risk associated with certain investment securities, it is reasonably
possible that changes in the values of investment securities, will occur in the
near term and that such changes could materially affect the amounts reported in
the Statement of Net Assets Available for Benefits.
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3. INVESTMENTS
The following presents investments that represent 5% or more of the
Plan's net assets.
December 31, December 31,
2001 2000
------------ -----------
Mutual Funds:
T. Rowe Price Growth and Income Fund $17,009,672 $13,124,914
T. Rowe Price Mid-Cap Growth Fund - 2,786,825
T. Rowe Price Balanced Fund 11,921,425 -
Common Stock:
ArvinMeritor * 45,110,777 10,026,173
ArvinMeritor 14,695,288 5,124,175
T. Rowe Price Stable Value Common Trust Fund - at contract value 43,683,110 5,396,154
T. Rowe Price Equity Index Trust Fund 33,994,298 -
* Nonparticipant - directed
The Plan's investments (including gains and losses on investments bought and
sold, as well as held during the period) appreciated (depreciated) in value as
follows:
Year Ended
December 31, 2001
-----------------
Common Stock $ 22,674,059
Mutual Funds (10,982,859)
------------
Net appreciation $ 11,691,200
============
4. NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of the
changes in net assets relating to the non-participant-directed investments is as
follows:
Year Ended
December 31, 2001
-----------------
Net assets - ArvinMeritor Common Stock Fund $ 45,110,777
Changes in net assets - ArvinMeritor Common Stock Fund:
Employer contributions 10,074,288
Net appreciation 16,371,562
Dividends 1,256,204
Benefits paid to participants or beneficiaries (2,911,780)
Other (primarily transfers in) 10,294,330
------------
Total $ 35,084,604
============
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5. TAX STATUS
The Internal Revenue Service determined and informed the Company by a
letter dated January 17, 2002, that the Plan was designed in accordance with
applicable sections of the Internal Revenue Code ("IRC"). The Plan has been
amended since receiving the determination letter.
The Plan has requested an updated determination letter based on current
year Plan amendments. The Company believes that the Plan qualifies under Section
401(a) of the IRC and is exempt from federal income taxes as of December 31,
2001. Therefore, no provision for income taxes has been included in the Plan's
financial statements.
6. RELATED PARTY TRANSACTIONS
Plan investments are shares of mutual funds managed by T. Rowe Price.
T. Rowe Price is the trustee as defined by the Plan and, therefore, these
transactions qualify as party-in-interest transactions.
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ARVINMERITOR, INC. SAVINGS PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS (HELD AT YEAR END)
DECEMBER 31, 2001
--------------------------------------------------------------------------------
DESCRIPTION OF INVESTMENT
IDENTITY OF ISSUER, INCLUDING MATURITY DATE,
BORROWER, LESSOR RATE OF INTEREST, COLLATERAL, CURRENT
OR SIMILAR PARTY PAR OR MATURITY VALUE VALUE
* T. Rowe Price International Stock Fund $ 2,444,051
* T. Rowe Price Equity Index Trust Fund 33,994,298
* T. Rowe Price Growth and Income Fund 17,009,672
* T. Rowe Price Mid-Cap Growth Fund 6,925,405
Franklin Small-Cap Stock Fund 7,430,494
* T. Rowe Price Balanced Fund 11,921,425
* T. Rowe Price Stable Value Common Trust Fund 43,683,110
Janus Fund Large-Cap Growth Fund 3,122,503
Pimco US Treasury Intermediate Fund 3,356,267
Cash 35,534
* ArvinMeritor Common Stock 59,806,065
* Participant loans Rates recorded at 1% over prime
rate, and maturities up to
120 months 6,348,209
------------
$196,077,033
============
* Party-in-interest.
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ARVINMERITOR, INC. SAVINGS PLAN
SCHEDULE H, LINE 4j - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 2001
--------------------------------------------------------------------------------
Series of transactions, when aggregated, involving an amount in excess of 5% of
beginning plan net assets.
(h)
(a) CURRENT VALUE
IDENTITY (c) (d) (g) OF ASSET ON
OF PARTY (b) PURCHASE SELLING COST OF TRANSACTION (l)
INVOLVED DESCRIPTION OF ASSET PRICE PRICE ASSET DATE LOSS
T. Rowe Price ArvinMeritor Common Stock $ 28,830,779 $ 28,830,779
(53 purchases)
T. Rowe Price ArvinMeritor Common Stock $ 2,297,013 $ 2,789,355 $ 2,297,013 $ (492,342)
(154 sales)
- 10 -
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act
of 1934, the Plan Administrator has duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
ARVINMERITOR, INC. SAVINGS PLAN
By:/s/ Richard D. Greb
---------------------
Richard D. Greb, Plan Administrator
June 26, 2002
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EXHIBIT INDEX
EXHIBIT
23 INDEPENDENT AUDITORS' CONSENT