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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13E-3
(Amendment
No. 1)
Rule 13E-3 Transaction Statement
Pursuant to Section 13(e) of
the Securities Exchange Act of 1934
Rule 13E-3 Transaction Statement
Pursuant to Section 13(e) of
the Securities Exchange Act of 1934
LEAR CORPORATION
(Name of the Issuer)
Lear Corporation
American Property Investors, Inc.
American Real Estate Partners, L.P.
American Real Estate Holdings Limited Partnership
AREP Car Holdings Corp.
AREP Car Acquisition Corp.
Carl C. Icahn
Vincent J. Intrieri
(Names of Person(s) Filing Statement)
American Property Investors, Inc.
American Real Estate Partners, L.P.
American Real Estate Holdings Limited Partnership
AREP Car Holdings Corp.
AREP Car Acquisition Corp.
Carl C. Icahn
Vincent J. Intrieri
(Names of Person(s) Filing Statement)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
521865105
(CUSIP Number of Class of Securities)
(CUSIP Number of Class of Securities)
| Lear Corporation 21557 Telegraph Road Southfield, MI 48033 Attn: Daniel A. Ninivaggi Executive Vice President, Secretary and General Counsel (248) 447-1500 |
American Real Estate Partners, L.P. 767 Fifth Avenue, Suite 4700 New York, New York 10153 Attn: Keith A. Meister Principal Executive Officer and Vice Chairman of the Board (212) 702-4300 |
(Name, Address, and Telephone Numbers of Person Authorized to Receive Notices
and Communications on Behalf of the Persons Filing Statement)
With copies to:
and Communications on Behalf of the Persons Filing Statement)
With copies to:
| Bruce A. Toth, Esq. Winston & Strawn LLP 35 W. Wacker Drive Chicago, Illinois 60601 (312) 558-5600 |
Steven L. Wasserman, Esq. DLA Piper US LLP 1251 Avenue of the Americas New York, New York 10020 (212) 335-4948 |
This statement is filed in connection with (check the appropriate box):
| a. þ | The filing of solicitation materials or an information statement subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the Securities Exchange Act of 1934. | |
| b. o | The filing of a registration statement under the Securities Act of 1933. | |
| c. o | A tender offer. | |
| d. o | None of the above. |
Check the following box if the soliciting materials or information statement referred to in
checking box (a) are preliminary copies: þ
Check the following box if the filing is a final amendment reporting the results of the
transaction: o
Calculation of Filing Fee
Transaction valuation |
$2,858,944,606* | Amount of filing fee | $ | 87,770 | ** | ||||||||
| * | Calculated solely for the purpose of determining the filing fee. | |
| ** | The maximum aggregate value was determined based upon the sum of (A) 76,642,783 shares of Common Stock multiplied by $36.00 per share; (B) options to purchase 720,575 shares of Common Stock with exercise prices less than $36.00 multiplied by $3.94 (which is the difference between $36.00 and the weighted average exercise price of $32.06 per share); (C) restricted stock units with respect to 1,856,831 shares of Common Stock multiplied by $36.00 per share; (D) stock appreciation rights with respect to 2,209,952 shares of Common Stock multiplied by $9.16 (which is the difference between $36.00 and the weighted average exercise price of $26.84 per share); (E) deferred unit accounts with respect to 104,432 shares of Common Stock multiplied by $36.00 per share; and (F) performance shares with respect to 169,909 shares of Common Stock multiplied by $36.00 per share. In accordance with Section 14(g) of the Securities Exchange Act of 1934, as amended, the filing fee was determined by multiplying 0.0000307 by the sum calculated in the preceding sentence. | |
| þ | Check the box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
Amount Previously Paid:
|
$ | 87,770 | Filing Party: | Lear Corporation | ||||
Form or Registration No.:
|
Schedule 14A | Date Filed: | March 20, 2007 | |||||
TABLE OF CONTENTS
Table of Contents
INTRODUCTION
This
Amendment No. 1 to Rule 13e-3 Transaction Statement (the “Transaction Statement”) is being filed with the
Securities and Exchange Commission (the “SEC”) pursuant to Section 13(e) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), by Lear Corporation, a Delaware corporation (the
“Company”), AREP Car Holdings Corp., a Delaware corporation (“Parent”), AREP Car Acquisition Corp.,
a Delaware corporation (“Merger Sub”), American Real Estate Holdings Limited Partnership, a
Delaware limited partnership (“AREH”), American Real Estate Partners, L.P., a Delaware limited
partnership (“AREP”), American Property Investors, Inc., a Delaware corporation, Carl C. Icahn and
Vincent J. Intrieri (collectively, the “Filing Persons”).
This Transaction Statement relates to the Agreement and Plan of Merger, dated as of February
9, 2007 (the “Merger Agreement”), by and among the Company, Parent and Merger Sub. If the Merger
Agreement is approved by the Company’s stockholders and the other conditions to the closing of the
merger are either satisfied or waived, Merger Sub will be merged with
and into the Company (the “Merger”). The separate corporate existence of Merger Sub will cease, and the Company will
continue its corporate existence under Delaware law as the surviving corporation in the Merger.
The separate corporate existence of the Company with all of its rights, privileges, immunities,
powers and franchises, shall continue unaffected by the Merger. Upon consummation of the Merger,
each share of Company common stock issued and outstanding immediately prior to the effective time
of the merger, other than shares owned by Parent, Merger Sub or any subsidiary of Parent or shares
held by holders who have properly demanded and perfected their appraisal rights, will be converted
into the right to receive $36.00 in cash, without interest and less any applicable withholding
taxes.
Concurrently with the filing of this Transaction Statement, the Company is filing with the SEC
an amended preliminary proxy statement (the “Proxy Statement”) under Regulation 14A of the Exchange Act in
connection with the Merger and the annual meeting of the stockholders of the Company. The Proxy
Statement is attached hereto as Exhibit (a)(1). A copy of the Merger Agreement is attached to the
Proxy Statement as Appendix A and is incorporated herein by reference. As of the date hereof, the
Proxy Statement is in preliminary form and is subject to completion or amendment.
Pursuant to General Instruction F to Schedule 13E-3, the information in the Proxy Statement,
including all annexes, exhibits and appendices thereto, is expressly incorporated by reference
herein in its entirety, and responses to each item herein are qualified in their entirety by the
information contained in the Proxy Statement. The cross references below are being supplied
pursuant to General Instruction G to Schedule 13E-3 and show the location in the Proxy Statement of
the information required to be included in response to the items of Schedule 13E-3.
All information contained in, or incorporated by reference into, this Transaction Statement
concerning each Filing Person was supplied by such Filing Person, and no other Filing Person,
including the Company, takes responsibility for the accuracy of such information as it relates to
any other Filing Person.
The filing of this Transaction Statement shall not be construed as an admission by any of the
Filing Persons or by any affiliate of a Filing Person that any Filing Person is an “affiliate” of
the Company within the meaning of Rule 13e-3.
Item 1. Summary Term Sheet
The information set forth in the Proxy Statement under the following caption is incorporated
herein by reference:
“Summary Term Sheet”
Item 2. Subject Company Information
(a) Name and Address. The Company’s name and the address and telephone number of its principal
executive offices are as follows:
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Lear Corporation
21557 Telegraph Road
Southfield, Michigan 48033
(248) 447-1500
21557 Telegraph Road
Southfield, Michigan 48033
(248) 447-1500
(b) Securities. The information set forth in the Proxy Statement under the following captions
is incorporated herein by reference:
“Summary of Annual Meeting – Outstanding Shares”
(c) Trading Market and Price. The information set forth in the Proxy Statement under the
following caption is incorporated herein by reference:
“Important Information Regarding Lear—Market Price of Common Stock”
(d) Dividends. The information set forth in the Proxy Statement under the following caption is
incorporated herein by reference:
“The Merger Agreement—Conduct of Business Prior to Closing”
“Important Information Regarding Lear—Market Price of Common Stock”
(e) Prior Public Offerings. Not applicable.
(f) Prior Stock Purchases. The information set forth in the Proxy Statement under the
following caption is incorporated herein by reference:
“Important Information Regarding Lear—Prior Purchases and Sales of Lear Common Stock”
Item 3. Identity and Background of Filing Person
(a) Name and Address. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
“The Parties to the Merger”
“Important
Information Regarding Lear”
“Important
Information Regarding Mr. Ichan, Mr. Intrieri, API, AREH, AREP,
Parent and Merger Sub”
(b) Business and Background of Entities. The information set forth in the Proxy Statement
under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“The Parties to the Merger”
“Important Information Regarding Lear”
“Important
Information Regarding Mr. Ichan, Mr. Intrieri, API, AREH, AREP,
Parent and Merger Sub”
(c) Business and Background of Natural Persons. The information set forth in the Proxy
Statement under the following captions is incorporated herein by reference:
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“Summary Term Sheet”
“The Parties to the Merger”
“Directors and Beneficial Ownership”
“Important Information Regarding Lear—Executive Officers of Lear”
“Important
Information Regarding Mr. Ichan, Mr. Intrieri, API, AREH, AREP,
Parent and Merger Sub”
Item 4. Terms of the Transaction
(a) Material terms. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Summary of the Annual Meeting”
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors—Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—Material U.S. Federal Income Tax Consequences of the Merger to Our Stockholders”
“The Merger Agreement”
Appendix A—The Merger Agreement
(c) Different Terms. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special
Factors—Certain Effects of the Merger”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“The Merger Agreement—Treatment of Options and Other Awards”
(d) Appraisal Rights. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
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“Answers to Questions You May Have”
“Appraisal Rights”
Appendix F—Section 262
of the General Corporation Law of the State of Delaware
(e) Provisions for Unaffiliated Security Holders. None.
(f) Eligibility for Listing or Trading. Not applicable.
Item 5. Past Contacts, Transactions, Negotiations and Agreements
(a) Transactions. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
“Special
Factors—Background of the Merger”
“Special
Factors—Limited Guaranty”
“Special
Factors—Interests of the Lear’s Directors and Executive Officers in the Merger”
“Special
Factors—Voting Agreement”
“The Merger Agreement”
(b)-(c) Significant Corporate Events; Negotiations or Contacts. The information set forth in
the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors—Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn,
Mr. Intrieri, API, AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Plans for Lear after the Merger”
“Special
Factors—Limited Guaranty”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“Special
Factors—Voting Agreement”
“The Merger Agreement”
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Appendix A—The Merger Agreement
(e) Agreements Involving the Subject Company’s Securities. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors—Financing of the Merger”
“Special Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“Special Factors—Limited Guaranty”
“Special Factors—Voting Agreement”
“The Merger Agreement”
Appendix A—The Merger Agreement
Appendix C—The Voting Agreement
Item 6. Purposes of the Transaction and Plans or Proposals
(b) Use of Securities Acquired. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special
Factors—Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purposes and
Reasons for the Merger”
“Special Factors—Plans for Lear after the Merger”
“Special Factors—Certain Effects of the Merger”
“The Merger Agreement—Merger Consideration”
“The Merger Agreement—Treatment of Options and Other Awards”
Appendix A—The Merger Agreement
(c)(1)-(8) Plans. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special Factors—Background of the Merger”
“Special Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special Factors—Opinion of Financial Advisor to the Special Committee”
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“Special
Factors—Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Plans for Lear after the Merger”
“Special
Factors—Certain Effects of the Merger”
“Special
Factors— Financing of the Merger”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“The Merger Agreement”
Appendix A—The Merger Agreement
Item 7. Purposes, Alternatives, Reasons and Effects
(a) Purposes. The information set forth in the Proxy Statement under the following captions is
incorporated herein by reference:
“Summary Term Sheet”
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors—Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to
the Fairness of the Merger”
“Special
Factors—Plans for Lear after the Merger”
“Special
Factors—Certain Effects of the Merger”
(b) Alternatives. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors— Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
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“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
(c) Reasons. The information set forth in the Proxy Statement under the following captions is
incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special Factors—Background of the Merger”
“Special Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors— Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Opinion and Report of Advisors to Mr. Ichan,
Mr. Intrieri, API, AREH, AREP, Parent and Merger Sub”
“Special Factors—Plans for Lear after the Merger”
The
Strategic Assessment Report, dated February 2, 2007, by A. T. Kearney
Inc. for American Real Estate Partners, L.P. is attached hereto as
Exhibit (c)(6) and is
incorporated herein by reference.
(d) Effects. The information set forth in the Proxy Statement under the following captions is
incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special Factors—Background of the Merger”
“Special Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors— Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special Factors—Plans for Lear after the Merger”
“Special Factors—Certain Effects of the Merger”
“Special Factors—Financing of the Merger”
“Special Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“Special Factors—Material U.S. Federal Income Tax Consequences of the Merger to Our Stockholders”
“The Merger Agreement”
Appendix A—The Merger Agreement
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Item 8. Fairness of the Transaction
(a)–(b) Fairness; Factors Considered in Determining Fairness. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference:
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors— Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Plans for Lear after the Merger”
“Important Information Regarding Lear”
Appendix B—Fairness Opinion of J.P. Morgan Securities Inc.
The
presentations dated February 1, 2007, February 3, 2007 and February 6, 2007, prepared by J.P. Morgan Securities Inc. for the
Special Committee of the Board of Directors of the Company, are
attached hereto as Exhibits (c)(2), (c)(3)
and (c)(4), respectively, and are incorporated by reference herein.
(c) Approval of Security Holders. The transaction is not structured so that approval of at
least a majority of unaffiliated security holders is required.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Summary of the Annual Meeting—Record Date”
“Summary of the Annual Meeting—Quorum”
“Summary of the Annual Meeting—Required Vote”
“The Merger Agreement—Conditions to the Merger”
(d) Unaffiliated Representative. An unaffiliated representative was not retained to act solely
on behalf of unaffiliated security holders for purposes of negotiating the terms of the transaction
or preparing a report concerning the fairness of the transaction.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference:
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“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors— Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
Appendix B—Fairness Opinion of J.P. Morgan Securities Inc.
(e) Approval of Directors. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
(f) Other Offers. Not applicable.
Item 9. Reports, Opinions, Appraisals and Negotiations
(a) – (c) Report, Opinion or Appraisal; Preparer and Summary of the Report, Opinion or
Appraisal; Availability of Documents. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“Summary Term Sheet—Opinion of J.P. Morgan Securities Inc.”
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Opinion of Financial Advisor to the Special Committee”
“Special
Factors—Opinion and Report of Advisors to Mr. Icahn, Mr. Intrieri, API, AREH, AREP, Parent and Merger Sub”
“Important Information Regarding Lear”
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Appendix B—Fairness Opinion of J.P. Morgan Securities Inc.
The
presentations dated February 1, 2007, February 3, 2007 and February 6, 2007, prepared by J.P. Morgan Securities Inc. for the
Special Committee of the Board of Directors of the Company, are attached hereto as Exhibits (c)(2), (c)(3) and (c)(4), respectively, and are incorporated
by reference herein.
Information provided by the Company to J.P. Morgan
Securities Inc. in connection with the financial analysis reflected in J.P. Morgan
Securities Inc.’s presentations for the Special Committee of the Board of Directors
of the Company is attached hereto as Exhibit (c)(5)
and incorporated herein by reference.
The
Strategic Assessment Report, dated February 2, 2007, by A. T. Kearney
Inc. for American Real Estate Partners, L.P. is attached hereto as
Exhibit (c)(6) and
incorporated herein by reference.
The
opinion of Morgan Joseph & Co. Inc., dated February 9,
2007, is attached hereto as Exhibit (c)(7) and is incorporated
herein by reference.
Item 10. Source and Amounts of Funds or Other Consideration
(a) - (d) Source of Funds; Conditions; Expenses; Borrowed Funds. The information set forth in
the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special
Factors—Financing of the Merger”
“The Merger Agreement—Financing”
“The Merger Agreement—Fees and Expenses”
“The Merger Agreement—Termination Fees and Expenses”
“The Merger Agreement—Conditions to the Merger”
Appendix A—The Merger Agreement
Item 11. Interest in Securities of the Subject Company
(a) Securities Ownership. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary Term Sheet”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“Important Information Regarding Lear—Security Ownership of Certain Beneficial Owners and
Management”
(b) Securities Transactions. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“Special
Factors—Voting Agreement”
“Important Information Regarding Lear—Securities Ownership of Certain Beneficial Owners and
Management”
“Important Information Regarding Lear—Prior Purchases and Sales of Lear Common Stock”
Item 12. The Solicitation or Recommendation
(d) Intent to Tender or Vote in a Going-Private Transaction. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
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“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors— Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
“Special
Factors—Voting Agreement”
(e) Recommendation of Others. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“Summary Term Sheet”
“Answers to Questions You May Have”
“Special
Factors—Background of the Merger”
“Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and Our Board of
Directors”
“Special
Factors—Mr. Icahn’s, Mr. Intrieri’s,
API’s, AREH’s, AREP’s, Parent’s and Merger Sub’s Purpose and
Reasons for the Merger”
“Special
Factors—The Position of Mr. Icahn, Mr. Intrieri, API,
AREH, AREP, Parent and Merger Sub as to the
Fairness of the Merger”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
Item 13. Financial Information
(a) Financial Information. The audited financial statements set forth in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2006 are incorporated herein by reference.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference:
“Important Information Regarding Lear—Selected Financial Data”
“Where You Can Find More Information”
(b) Pro forma Information. Not applicable.
Item 14. Persons/Assets, Retained, Employed, Compensated or Used
(a) Solicitations or Recommendations. The information set forth in the Proxy Statement under
the following captions is incorporated herein by reference:
“Answers to Questions You May Have—Questions and Answers About the Annual Meeting”
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“Summary of the Annual Meeting—Proxy Solicitation”
(b) Employees and corporate assets. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“Special
Factors—Plans for Lear After the Merger”
“Special
Factors—Interests of Lear’s Directors and Executive Officers in the Merger”
Item 15. Additional Information
(b) Other material information. The information set forth in the Proxy Statement, including
all appendices thereto, is incorporated herein by reference.
Item 16. Exhibits
(a)(1) Preliminary Proxy Statement of Lear Corporation (incorporated by reference to the
Schedule 14A filed with the Securities and Exchange Commission
on May 1, 2007).
(a)(2) Form of Proxy Card (incorporated herein by reference to the Proxy
Statement).
(a)(3) Letter to Stockholders (incorporated herein by reference to the Proxy Statement).
(a)(4) Notice of Special Meeting of Stockholders (incorporated herein by reference to the
Proxy Statement).
(b)(1)
Commitment Letter, dated February 8, 2007, by Bank of America, N.A. and Banc of America
Securities LLC (previously filed as Exhibit (b)(1) to the
Schedule 13E-3 filed with the Securities and Exchange Commission
on March 20, 2007).
(c)(1)
Opinion of J.P. Morgan Securities Inc., dated February 8, 2007 (incorporated herein by
reference to Appendix B of the Proxy Statement).
(c)(2)
Presentation, dated February 1, 2007, by J.P. Morgan Securities Inc. for the Special
Committee of the Board of Directors of Lear Corporation.
(c)(3)
Presentation, dated February 3, 2007, by J.P. Morgan Securities Inc. for the Special Committee of the Board of Directors of Lear Corporation.
(c)(4)
Presentation, dated February 6, 2007, by J.P. Morgan Securities Inc. for the Special Committee of the Board of Directors of Lear Corporation (previously filed as Exhibit (c)(2) to Schedule 13E-3 filed with the Securities and Exchange Commission on March 20, 2007).
(c)(5) Information provided by Lear Corporation to J.P. Morgan Securities Inc. in connection with J.P. Morgan Securities Inc.’s presentations to the Special Committee of the Board of Directors of Lear Corporation.
(c)(6)
Strategic Assessment Report, dated February 2, 2007, by A. T. Kearney
Inc. for American Real Estate Partners, L.P. (previously filed as
Exhibit (c)(3) to Schedule 13E-3 filed with the Securities
and Exchange Commission on March 20, 2007).†
(c)(7)
Opinion of Morgan Joseph & Co. Inc., dated
February 9, 2007 (previously filed as Exhibit (c)(4) to
Schedule 13E-3 filed with the Securities and Exchange Commission
on March 20, 2007).
(d)(1) Agreement and Plan of Merger, dated February 9, 2007, among Lear Corporation, AREP Car
Holdings Corp. and AREP Car Acquisition Corp. (incorporated herein by reference to Appendix A of
the Proxy Statement).
(d)(2) Voting Agreement, dated February 9, 2007, by and among Lear Corporation, Icahn Partners
LP, Icahn Partners Master Fund LP, Koala Holding Limited Partnership and High River Limited
Partnership (incorporated by reference to Appendix C of the Proxy Statement).
(d)(3) Guaranty of Payment, dated February 9, 2007, by American Real Estate Partners, L.P. in
favor of Lear Corporation (incorporated by reference to
Appendix D of the Proxy Statement).
(d)(4) Stock Purchase Agreement, dated as of October 17, 2006, among the Lear Corporation,
Icahn Partners LP, Icahn Partners Master Fund LP and Koala Holding LLC (incorporated by reference
to Exhibit 10.1 to Lear’s Current Report on Form 8-K (SEC File No. 1-11311), filed on October 17,
2006).
(f) Appendix F to the Proxy Statement (incorporated herein by reference to the Proxy
Statement).
† Certain information in this exhibit has been omitted and filed
separately with the SEC pursuant to a confidential treatment request
under Rule 24b-2 of the Exchange Act. Omitted portions are indicated
in this exhibit with [*].
12
Table of Contents
SIGNATURE
After due inquiry and to the best of each of the undersigned’s knowledge and belief, each of
the undersigned certifies that the information set forth in this statement is true, complete and
correct.
Dated as
of May 1, 2007
| LEAR CORPORATION |
||||
| By: | /s/ Daniel A. Ninivaggi | |||
| Name: Daniel A. Ninivaggi | ||||
Title: Executive Vice President,
Secretary and General Counsel |
||||
| AREP CAR HOLDINGS CORP. |
||||
| By: | /s/ Andrew Skobe | |||
| Name: Andrew Skobe | ||||
| Title: Chief Financial Officer | ||||
| AREP CAR ACQUISITION CORP. |
||||
| By: | /s/ Andrew Skobe | |||
| Name: Andrew Skobe | ||||
| Title: Chief Financial Officer | ||||
| AMERICAN REAL ESTATE HOLDINGS LIMITED PARTNERSHIP | ||||||
| By: | American Property Investors, Inc., its General Partner | |||||
| By: | /s/ Andrew
Skobe
|
|||||
| Title: Interim Chief Accounting Officer, Interim Chief Financial Officer and Treasurer | ||||||
| AMERICAN REAL ESTATE PARTNERS, L.P. | ||||||
| By: | American Property Investors, Inc., its General Partner | |||||
| By: | /s/ Andrew
Skobe
|
|||||
| Title: Interim Chief Accounting Officer, Interim Chief Financial Officer and Treasurer | ||||||
13
Table of Contents
| AMERICAN PROPERTY INVESTORS, INC. |
||||
| By: | /s/ Andrew Skobe | |||
| Name: Andrew Skobe | ||||
| Title: Interim Chief Accounting Officer, Interim Chief Financial Officer and Treasurer | ||||
| CARL C. ICAHN |
||||
| By: | /s/ Carl C. Icahn | |||
| VINCENT J. INTRIERI |
||||
| By: | /s/ Vincent J. Intrieri | |||
INDEX TO EXHIBITS
(a)(1) Preliminary Proxy Statement of Lear Corporation (incorporated by reference to the
Schedule 14A filed with the Securities and Exchange Commission
on May 1, 2007).
(a)(2) Form of Proxy Card (incorporated herein by reference to the Proxy
Statement).
(a)(3) Letter to Stockholders (incorporated herein by reference to the Proxy Statement).
(a)(4) Notice of Special Meeting of Stockholders (incorporated herein by reference to the
Proxy Statement).
(b)(1) Commitment Letter, dated February 8, 2007, by Bank of America, N.A. and Banc of America
Securities LLC (previously filed as Exhibit (b)(1) to the
Schedule 13E-3 filed with the Securities and Exchange Commission
on March 20, 2007).
(c)(1) Opinion of J.P. Morgan Securities Inc., dated February 8, 2007 (incorporated herein by
reference to Appendix B of the Proxy Statement).
(c)(2)
Presentation, dated February 1, 2007, by J.P. Morgan Securities Inc. for the Special
Committee of the Board of Directors of Lear Corporation.
(c)(3)
Presentation, dated February 3, 2007, by J.P. Morgan Securities Inc. for the Special Committee of the Board of Directors of Lear Corporation.
(c)(4)
Presentation, dated February 6, 2007, by J.P. Morgan Securities Inc. for the Special Committee of the Board of Directors of Lear Corporation (previously filed as Exhibit (c)(2) to Schedule 13E-3 filed with the Securities and Exchange Commission on March 20, 2007).
(c)(5) Information provided by Lear Corporation to J.P. Morgan Securities Inc. in connection with J.P. Morgan Securities Inc.’s presentations to the Special Committee of the Board of Directors of Lear Corporation.
(c)(6)
Strategic Assessment Report, dated February 2, 2007, by A.T.
Kearney Inc. for American Real Estate Partners, L. P. (previously
filed as Exhibit (c)(3) to the Schedule 13E-3 filed with
the Securities and Exchange Commission on March 20, 2007)†
(c)(7)
Opinion of Morgan Joseph & Co. Inc., dated
February 9, 2007 (previously filed as Exhibit (c)(4) to the
Schedule 13E-3 filed with the Securities and Exchange Commission
on March 20, 2007).
(d)(1) Agreement and Plan of Merger, dated February 9, 2007, among Lear Corporation, AREP Car
Holdings Corp. and AREP Car Acquisition Corp. (incorporated herein by reference to Appendix A of
the Proxy Statement).
(d)(2) Voting Agreement, dated February 9, 2007, by and among Lear Corporation, Icahn Partners
LP, Icahn Partners Master Fund LP, Koala Holding Limited Partnership and High River Limited
Partnership (incorporated by reference to Appendix C of the Proxy Statement).
(d)(3) Guaranty of Payment, dated February 9, 2007, by American Real Estate Partners, L.P. in
favor of Lear Corporation (incorporated by reference to
Appendix D of the Proxy Statement).
(d)(4) Stock Purchase Agreement, dated as of October 17, 2006, among the Lear Corporation,
Icahn Partners LP, Icahn Partners Master Fund LP and Koala Holding LLC (incorporated by reference
to Exhibit 10.1 to Lear’s Current Report on Form 8-K (SEC File No. 1-11311), filed on October 17,
2006).
(f) Appendix F to the Proxy Statement (incorporated herein by reference to the Proxy
Statement).
† Certain information in this exhibit has been omitted and filed
separately with the SEC pursuant to a confidential treatment request
under Rule 24b-2 of the Exchange Act. Omitted portions are indicated
in this exhibit with [*].
14
EXHIBIT (c)(2)
| F E B R U A R Y 1 , 2 0 0 7 V A L U A T I O N M A T E R I A L S S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L PROJECT LONGBOW |
| English_General This presentation was prepared exclusively for the benefit and internal use of the JPMorgan client to whom it is directly addressed and delivered (including such client's subsidiaries, the "Company") in order to assist the Company in evaluating, on a preliminary basis, the feasibility of a possible transaction or transactions and does not carry any right of publication or disclosure, in whole or in part, to any other party. This presentation is for discussion purposes only and is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by JPMorgan. Neither this presentation nor any of its contents may be disclosed or used for any other purpose without the prior written consent of JPMorgan. The information in this presentation is based upon any management forecasts supplied to us and reflects prevailing conditions and our views as of this date, all of which are accordingly subject to change. JPMorgan's opinions and estimates constitute JPMorgan's judgment and should be regarded as indicative, preliminary and for illustrative purposes only. In preparing this presentation, we have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was provided to us by or on behalf of the Company or which was otherwise reviewed by us. In addition, our analyses are not and do not purport to be appraisals of the assets, stock, or business of the Company or any other entity. JPMorgan makes no representations as to the actual value which may be received in connection with a transaction nor the legal, tax or accounting effects of consummating a transaction. Unless expressly contemplated hereby, the information in this presentation does not take into account the effects of a possible transaction or transactions involving an actual or potential change of control, which may have significant valuation and other effects. Notwithstanding anything herein to the contrary, the Company and each of its employees, representatives or other agents may disclose to any and all persons, without limitation of any kind, the U.S. federal and state income tax treatment and the U.S. federal and state income tax structure of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are provided to the Company relating to such tax treatment and tax structure insofar as such treatment and/or structure relates to a U.S. federal or state income tax strategy provided to the Company by JPMorgan. JPMorgan's policies prohibit employees from offering, directly or indirectly, a favorable research rating or specific price target, or offering to change a rating or price target, to a subject company as consideration or inducement for the receipt of business or for compensation. JPMorgan also prohibits its research analysts from being compensated for involvement in investment banking transactions except to the extent that such participation is intended to benefit investors. IRS Circular 230 Disclosure: JPMorgan Chase & Co. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters included herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone not affiliated with JPMorgan Chase & Co. of any of the matters addressed herein or for the purpose of avoiding U.S. tax-related penalties. JPMorgan is a marketing name for investment banking businesses of JPMorgan Chase & Co. and its subsidiaries worldwide. Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by a combination of J.P. Morgan Securities Inc., J.P. Morgan plc, J.P. Morgan Securities Ltd. and the appropriately licensed subsidiaries of JPMorgan Chase & Co. in Asia-Pacific, and lending, derivatives and other commercial banking activities are performed by JPMorgan Chase Bank, N.A. JPMorgan deal team members may be employees of any of the foregoing entities. This presentation does not constitute a commitment by any JPMorgan entity to underwrite, subscribe for or place any securities or to extend or arrange credit or to provide any other services. V A L U A T I O N M A T E R I A L S |
| Appendix (pages from July valuation book) Longbow valuation update 1 1 1 2 12 V A L U A T I O N M A T E R I A L S |
| Comparison of improvement plan cases Current Improvement Plan $ millions Note: Debt balances do not include off balance sheet debt to conform with equity analyst treatment 2006A financials as reported and includes interiors business; 2007E and 2008E reflects divestiture of interiors business 1 Diluted shares outstanding increase due to $200mm equity investment by Icahn 2 Net debt as of 12/31/06 3 Net debt as of 3/31/06 Previous Improvement Plan (Jul '06) 2 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow summary financial projections - by division Note: Projections based on Longbow's current improvement plan; historical figures are not pro forma for the Interiors divestiture 1 Net of intercompany sales and corporate overhead Seating Electronics and Electrical Interiors Consolidated1 $ millions, Improvement plan 3 L O N G B O W V A L U A T I O N U P D A T E |
| Indicative equity value per share Longbow valuation $29.06 Transaction comparables2 5.5-6.5x 2006E EBITDA ($765mm) Midpoint of value range Trading comparables1 4.75-5.75x 2007E EBITDA ($810mm) $40.89 $33.47 Analyst price targets1 52-week trading range1 $34.77 Current Price Improvement Plan Sensitivity case3 $29.49 $26.50 $28.05 $25.59 DCF LBO Improvement Plan Sensitivity case3 1 Trading multiple range and net debt figures not burdened by off balance sheet debt to match equity analyst multiples 2 2006E EBITDA is pro forma for the divestiture of interiors 3 Reflects sales reductions of $510mm , $785mm, $975mm in 2008, 2009 and 2010, respectively at a 15% contribution margin; also reflects $50mm supplier support payments in 2007 and $25mm cash outflow for each year for 2007 - 2010 for investments in capacity reductions and other Mean Barbell 1 Barbell 5 Barbell 6 Barbell 7 Barbell 8 Barbell 9 Barbell 10 Barbell 11 Barbell 12 Barbell 13 Barbell 14 Barbell 15 Barbell 16 34.6 0 34.6 50 23.76 48 34.36 48 28.47 39 38.48 39 35.55 31 46.23 31 24.87 26 34.12 26 29.75 19 39.79 19 23.36 14 32.74 14 16 9 37 9 15.6 4 35.56 4 4 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow DCF - Improvement Plan Note: Cash taxes provided by management for 2007-2010 and are projected at a 35% tax rate thereafter; net debt includes $256mm of off-balance sheet debt 1 Other includes other expenses, tooling & engineering, non-cash pension expense, minority interest and equity earnings 2 Includes a $120mm cash impact from interiors 5 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow LBO - Improvement Plan Note: 2006 EBITDA is pro forma ($92)mm for the divestiture of interiors, cost of debt is L+250 basis points, 5% management promote; net debt includes $256mm of off-balance sheet debt 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings 2 Includes a $120mm cash impact from interiors 6 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow DCF - Sensitivity case Note: Net debt includes $256mm of off balance sheet debt; Cash taxes provided by management for 2007-2010 and are projected at a 35% tax rate thereafter 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings 2 Includes a $120mm cash impact from interiors business 3 Includes $50mm in supplier support payments in 2007 and $25mm cash outflow each year from 2007 - 2010 for investments in capacity reductions & other 7 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow LBO valuation analysis - Sensitivity case Note: Net debt includes $256mm of off balance sheet debt; 2006 EBITDA is pro forma ($92)mm for divestiture of interiors. Assumes cost of debt of L+250 basis points, , 5% management promote 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings 2 Includes a $120mm cash impact from interiors business 3 Includes $50mm in supplier support payments in 2007 and $25mm cash outflow each year from 2007 - 2010 for investments in capacity reductions & other 8 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow analysis at various prices Note: Current share price of $34.60 as of 1/29/07; Net debt of $2,035mm based on 12/31/06 debt (excludes off balance sheet debt to match equity analyst multiples); includes minority interest of $38mm; 2006A financials are pro forma for the divestiture of the interiors business Longbow analysis at various prices ($mm, except per share data) 9 L O N G B O W V A L U A T I O N U P D A T E |
| Automotive supplier trading comparables $ millions, except as noted Source: Bloomberg, Company filings, equity research Note: Market data as of 1/29/07; trading multiples not burdened by off balance sheet debt to match equity analyst multiples 10 L O N G B O W V A L U A T I O N U P D A T E |
| Automotive supplier transaction comparables European N. American Asian LBO Bridgestone 10.6 Robert Bosch GMBH 5.36 Hitachi Clarion 8.4 Asahi Tec 6 Platinum Equity Red Diamon Avon Autmotive 4.2 Continental 8.9 Bain Capital 10.1 Cooper Standard 4.6 One Equity 6.8 Carlyle 9 JCI Delphi's battery business 4 n n CVG MVS 4.3 N N Valeo Johnson Controls 9.5 E E BorgWarner Beru 6.5 N N Magna International Tesma International 5.5 N N Magna International Decoma International 3.4 N N Cypress Group Cooper-Standard 8.5 L L Cypress Group Dana AAG 6.1 L L TH Lee Progressive Moulded Products 7 Montagu Private Equity Stabilus 6.4 L L Kohlberg Co LLC Stanadyne 7 L L GS Capital Partners Autocam 7 L L Continental Phoenix AG 5.8 L E Vestar FL Selenia (Doughty Hanson) 7.9 N L HG Capital W.E.T. Automotive Systems 4.9 E L Tomkins PLC Stackpole 6.2 L N The Carlyle Group UIS 6.1 L L Rheinmetall AG Kolbenschmidt Pierburg 3.1 N E Castle Harlan, Inc. Advanced Accessory Systems 5.6 L L Blackstone Group TRW Automotive 4.9 E L Carlyle Group Edscha 4.9 L L CVC Kwikfit 3.6 L L Johnson Controls Varta Automotive Batteries 5.7 L E Questor/Investors Teksid Aluminum SpA 6.8 L L Magna International Donnelly Corp 8.9 E N Doughty Hanson A.T.U. 10.5 L L Hitachi Unisia Jecs 4.8 N A CSFB Oxford Automotive 4.9 L L INA FAG Kugelfischer 4.2 A E Collins & Aikman Textron Automotive Trim 5.6 L N ZF Sachs 5.4 E E Johnson Controls Sagem Electronics 7.9 N E Schroder Ventures Grammer 4 E L TI sharehlders TI Automotive (spin-off) 4.3 E E Delphi Automotive Eaton's Switch Division 7.1 L N Heartland Collins & Aikman 5.9 E L CVC Delco Remy 4.8 N N Faurecia SA SAI 7.7 L E GenCorp Laird-Draftex 4 N E Heartland Simpson Industries, Inc 5.6 E L Heartland MascoTech, Inc. 6.7 E L DaimlerChrysler AG Detroit Diesel Corp 5.6 L N HSBC BBA Automotive Friction 7.1 L L Parker Hannifin Corp Wynn's International 7.6 N N Schroder Ventures Kiekert AG 7.2 L L BC Partners Mark IV 7 N L Exide Corp GNB Battery Business 5.9 L A Meridian Automotive Cambridge Industries Inc 8.1 L N Fiat Spa Magneti Marelli (buy-out) 7.2 A E Valeo SA Labinal Auto (Sylea SA) 9.53 N E Meritor Automotive Arvin Industries 4.3 E N Siemens/Robert Bosch Mannesman AG - Atecs 8.7 E E Autoliv Inc OEA Inc 9.7 N E Saw Mill Capital Fund Jason Inc 5.5 E L Carlyle Group Tritech Precision & Trimin 5.5 E L Source: Company filings, analyst reports and JPMorgan estimates Note: Select announced domestic and cross-border deals as of 01/30/07 6.1x 11 L O N G B O W V A L U A T I O N U P D A T E |
| Appendix (pages from July valuation book) Longbow valuation update 12 Longbow valuation July 2006 1 1 2 12 V A L U A T I O N M A T E R I A L S |
| Summary of financial projections - by division 1 Net of intercompany sales and corporate overhead Seating Electronics and Electrical Interiors Consolidated1 13 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Indicative equity value per share Longbow valuation Mean Barbell 1 Barbell 2 Barbell 3 Barbell 4 Barbell 5 Barbell 6 Barbell 7 Barbell 8 Barbell 9 Barbell 10 Barbell 11 Barbell 12 Barbell 13 Barbell 14 Barbell 15 Barbell 16 25.29 11 14.81 11 30.54 10 20.05 10 46 8.5 33.42 8.5 35.28 8 25.15 8 22.73 7.5 13.27 7.5 27.44 6 16.81 6 28.65 4.2 17.65 4.2 26.35 3.7 16.1 3.7 18.2 3.2 10 3.2 30 2 14 2 45 1 15.65 1 21.45 0 21.45 12.5 $20.05 $30.22 Transaction comparables1 5.0-6.0x 2006E EBITDA ($706mm) Midpoint of value range $22.13 Trading comparables1 4.5-5.5x 2006E EBITDA ($706mm) $39.71 $25.30 Sum of the parts1,2 Analyst price targets1 52-week trading range1 $23.15 $21.23 Current Price Improvement Plan Partial Improvement Plan Sensitivity case $18.00 $22.00 $14.10 $30.33 DCF Partial Improvement Plan LBO Improvement Plan Sensitivity case Note:2006E EBITDA without restructuring costs is $820mm 1 Trading multiple range and net debt figures not burdened by off balance sheet debt to match equity analyst multiples 2 Divested Interiors value assumed to be negative $150mm. This is the estimated amount of cash that Longbow would need to exit the Interiors business 14 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Longbow DCF - Improvement Plan Note: Assumes 6/30/06 valuation date; cash taxes provided by management 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings 15 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| LBO valuation analysis - Improvement Plan Note: Assumes half of free cash flows available for debt service in 2006 and 2011 due to 6/30 entry and exit date, 9.0% interest rate on 1st lien debt, 12.0% interest rate on 2nd lien debt, $76mm transaction fees, $120mm minimum cash and 5% management promote; cash taxes provided by management 1 Other includes other expense, Tooling & Engineering, non-cash pension expense, minority interest and equity earnings 2 Includes off balance sheet debt 16 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Longbow DCF - Sensitivity Case Note: Assumes 6/30/06 valuation date; cash taxes provided by management 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings + cash impact of distressed supplier support payments, financing fees and incremental investment in JVs 17 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| LBO Sensitivity case Page not included in July 2006 board book 18 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Longbow analysis at various prices Note: Net debt of $2,181mm based on LTM 3/31/06 total debt (excluding ABS and factoring to match equity analyst multiples) pro forma for $1bn term loan issuance, repayment of $400mm term loan and $273mm convert tender 19 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Auto suppliers trading comparables Source: Bloomberg, Company filings, equity research Note: Market data as of 7/6/2006; trading multiples not burdened by off balance sheet debt to match equity analyst multiples 20 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Auto-parts M&A transaction multiples since 2000 Date Acquirer Target Total cost (FV) FV/ sales FV/ EBIT FV/EBITDA multiple LBO 6.0 5.1 6.0 3.0 4.9 7.9 5.8 6.4 2.6 7.0 3.6 6.2 5.0 5.4 01-Nov-04 Borg Warner Beru AG 543 1.41x 9.1x 29-Mar-04 Continental Phoenix 554 0.48x 12.5x 23-May-03 FINM (Manuli family) Manuli Rubber Industries 177 0.51x 4.9x 30-Apr-03 Tomkins Stackpole 190 1.03x 8.7x 3.1 07-Apr-03 Rheinmetall Kolbenschmidt Pierburg 680 0.36x 8.5x 09-Dec-04 Electra TK Fahrzeugguss 155 0.55x 5.7x 17-Sep-04 Cypress & GS PE Cooper Standard Automotive 1,165 0.64x 7.8x ? 08-Sep-04 Ripplewood Honsel 625 0.71x 11.3x ? 19-Jul-04 Cerberus GDX Automotive 147 0.19x 11.0x ? 09-Jul-04 Cypress Group Dana AAG 1,100 0.55x 8.0x ? 02-Jul-04 Montagu Stabilus N/D 1.30x 8.4x ? 03-May-04 GS Capital Partners Autocam 390 1.21x ? 04-Sep-03 Vestar Capital FL Selenia (Doughty Hanson) 670 1.4x 20.3x ? 28-May-03 HG Capital W.E.T. Automotive Systems 178 1.00x 6.1x ? 30-Apr-03 Carlyle UIS 800 0.86x ? 6.8 6.0 4.1 6.0 6.5 4.9 4.2 5.8 5.4 7.9 4.0 7.2 7.3 4.3 7.1 5.7 5.0 7.5 4.0 6.8 7.1 5.9 5.2 7.2 4.4 5.5 8.3 4.5 3.4 6.0 3.8 9.3 5.7 3.6 5.7 4.9 4.8 10.5 06-Aug-02 Johnson Controls Varta Automotive batteries 307 0.53x 10.8x 13-May-02 Hilite Siemens Hydraulik-Ring 113 0.95x 10.4x 18-Apr-02 Hitachi Unisia Jecs 530 0.35x 46.0x 22-Mar-02 GKN Tochigi Fuji Industrials (33.3%) 90 0.33x 07-Mar-02 Concordia Finance Magneti Marelli Aftermarket 71 0.31x 7.7x 10-Sep-01 INA FAG Kugelfischer 1,135 0.51x 7.7x 03-Aug-01 ZF Friedrichshafen Sachs 1,200 0.57x 25-Jul-01 Johnson Controls Sagem automotive electronics 435 0.83x 14.0x 02-Apr-01 Continental DaimlerChrysler TEMIC 553 0.60x 18.5x 22-Mar-01 ThyssenKrupp Magneti Marelli Suspensions 489 0.52x 12-Mar-01 Delphi Eaton 300 0.90x 15-Nov-00 Trelleborg Laird Automotive Component 148 0.50x 25-Oct-00 Faurecia SAI 1,670 0.70x 13.5x 23-Oct-00 GenCorp Laird-Draftex 204 13-Jun-00 Schroder Ventures Kiekert 438 0.70x 8.4x 08-May-00 Valeo Labinal 441 0.39x 7.5x 05-May-00 Fiat Magneti Marelli (buyout) 2,007 0.35x 31.7x 14-Apr-00 Bosch/Siemens ATECS 9,600 0.77x 17.1x 06-Apr-00 Meritor Arvin 1,255 0.40x 7.5x 04-Jan-00 Trelleborg Invensys AVS Business 250 0.49x 8.1x 25-Jun-02 Magna Donnelly Corporation 0.45x 16.2x 411 19-Nov-02 Blackstone TRW Automotive 4,725 0.45x 10.0x ? 12-Nov-02 Carlyle Edscha 514 0.58x 7.8x ? 30-Sep-02 Questor Teksid 482 0.56x ? 12-Aug-02 CVC Kwikfit 330 0.40x 5.1x ? 20-Jan-02 Doughty Hanson A.T.U. 1,030 1.11x 13.9x ? 18-Jan-02 CSFB Global Opps. Oxford Automotive 243 0.30x 25.3x ? 07-Aug-01 Collins & Aikman Textron automotive trim division 1,335 0.71x ? 27-Apr-01 Schroder Ventures Grammer 256 0.38x 6.2x ? 14-Mar-01 TI Shareholders TI Automotive (Spin off) 1,389 0.59x 5.5x ? 12-Jan-01 Heartland Collins & Aikman 1,280 0.67x 8.4x ? 10-Aug-00 Heartland MascoTech 2,129 1.23x 9.4x ? 01-Jul-00 HSBC BBA Automotive friction 586 1.26x 9.8x ? 05-Jun-00 Peter Cherry Cherry 180 0.50x 18.7x ? 29-May-00 BC Partners Mark IV 2,000 1.03x 10.2x ? 28-Jan-00 CVC Capital Partners Invensys Sealing Systems 400 0.39x 7.3x ? 10-Jan-00 JLL Hayes-Lemmerz 2,265 1.05x 9.2x ? 07-Jan-00 Carlyle Group Tritech Precision and Trimin 546 1.45x 17.1x ? 07-Jun-05 Inssec Cie Automotive SA 0.81x 14.3x 14-Jul-05 Deutsche Bank Grammer 0.39x 8.0x 26-Aug-05 Johnson Electric Saia-Burgess 767 1.28x 14.9x 547 319 10.2 4.8 6.0 05-Dec-05 Cooper-Standard ITT Auto Brake & Fuel Tubing Business 205 0.49x 8.2x 4.9 9.5x 09-Jan-06 Bain TI Sensors and Controls 3,000 2.80x 10.9x 03-Apr-06 Continental Motorola Automotive $1,000 0.63x Source: Securities Data Corporation, public information Note: Only transactions with FV/EBITDA multiple shown European target US target Asian target N/A 13-Jan-03 TI Automotive Kolbenschmidt Pierburg fuel pumps division N/A N/A N/A 06-Sep-05 TRW Dalphi Metal Espana 306 0.60x 23-Sep-05 Carlyle Group AxleTech 350 1.40x 9.0x 9.0 N/A 4.0 22-Mar-05 Johnson Controls Delphi (Battery) 213 0.35x 4.0x ? ? ? ? N/A 21 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
EXHIBIT (c)(3)
| F E B R U A R Y 3 , 2 0 0 7 V A L U A T I O N M A T E R I A L S S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L |
| English_General This presentation was prepared exclusively for the benefit and internal use of the JPMorgan client to whom it is directly addressed and delivered (including such client's subsidiaries, the "Company") in order to assist the Company in evaluating, on a preliminary basis, the feasibility of a possible transaction or transactions and does not carry any right of publication or disclosure, in whole or in part, to any other party. This presentation is for discussion purposes only and is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by JPMorgan. Neither this presentation nor any of its contents may be disclosed or used for any other purpose without the prior written consent of JPMorgan. The information in this presentation is based upon any management forecasts supplied to us and reflects prevailing conditions and our views as of this date, all of which are accordingly subject to change. JPMorgan's opinions and estimates constitute JPMorgan's judgment and should be regarded as indicative, preliminary and for illustrative purposes only. In preparing this presentation, we have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was provided to us by or on behalf of the Company or which was otherwise reviewed by us. In addition, our analyses are not and do not purport to be appraisals of the assets, stock, or business of the Company or any other entity. JPMorgan makes no representations as to the actual value which may be received in connection with a transaction nor the legal, tax or accounting effects of consummating a transaction. Unless expressly contemplated hereby, the information in this presentation does not take into account the effects of a possible transaction or transactions involving an actual or potential change of control, which may have significant valuation and other effects. Notwithstanding anything herein to the contrary, the Company and each of its employees, representatives or other agents may disclose to any and all persons, without limitation of any kind, the U.S. federal and state income tax treatment and the U.S. federal and state income tax structure of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are provided to the Company relating to such tax treatment and tax structure insofar as such treatment and/or structure relates to a U.S. federal or state income tax strategy provided to the Company by JPMorgan. JPMorgan's policies prohibit employees from offering, directly or indirectly, a favorable research rating or specific price target, or offering to change a rating or price target, to a subject company as consideration or inducement for the receipt of business or for compensation. JPMorgan also prohibits its research analysts from being compensated for involvement in investment banking transactions except to the extent that such participation is intended to benefit investors. IRS Circular 230 Disclosure: JPMorgan Chase & Co. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters included herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone not affiliated with JPMorgan Chase & Co. of any of the matters addressed herein or for the purpose of avoiding U.S. tax-related penalties. JPMorgan is a marketing name for investment banking businesses of JPMorgan Chase & Co. and its subsidiaries worldwide. Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by a combination of J.P. Morgan Securities Inc., J.P. Morgan plc, J.P. Morgan Securities Ltd. and the appropriately licensed subsidiaries of JPMorgan Chase & Co. in Asia-Pacific, and lending, derivatives and other commercial banking activities are performed by JPMorgan Chase Bank, N.A. JPMorgan deal team members may be employees of any of the foregoing entities. This presentation does not constitute a commitment by any JPMorgan entity to underwrite, subscribe for or place any securities or to extend or arrange credit or to provide any other services. V A L U A T I O N M A T E R I A L S |
| Appendix (pages from July valuation book) Longbow valuation update 1 1 1 2 12 V A L U A T I O N M A T E R I A L S |
| Comparison of improvement plan cases Current Improvement Plan $ millions Note: Debt balances do not include off balance sheet debt to conform with equity analyst treatment 2006A financials as reported and includes interiors business; 2007E and 2008E reflects divestiture of interiors business 1 Diluted shares outstanding increase due to $200mm equity investment by Icahn 2 Net debt as of 12/31/06 3 Net debt as of 3/31/06 Previous Improvement Plan (Jul '06) 2 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow summary financial projections - by division Note: Projections based on Longbow's current improvement plan; historical figures are not pro forma for the Interiors divestiture 1 Net of intercompany sales and corporate overhead Seating Electronics and Electrical Interiors Consolidated1 $ millions, Improvement plan 3 L O N G B O W V A L U A T I O N U P D A T E |
| Equity value per share Longbow valuation Transaction comparables2 5.5-6.5x 2006E EBITDA ($765mm) Trading comparables1 4.75-5.75x 2007E EBITDA ($810mm) Analyst price targets1 52-week trading range1 Current Price $34.09 Improvement Plan Sensitivity case3 DCF LBO Improvement Plan Sensitivity case3 1 Trading multiple range and net debt figures not burdened by off balance sheet debt to match equity analyst multiples 2 2006E EBITDA is pro forma for the divestiture of interiors 3 Reflects sales reductions of $510mm, $785mm, $975mm in 2008 and 2009 and 2010, respectively at a 15% contribution margin; also reflects $50mm supplier support payments in 2007 and $25mm cash outflow for each year for 2007 - 2010 for investments in capacity reductions and other Mean Barbell 1 Barbell 5 Barbell 6 Barbell 7 Barbell 8 Barbell 9 Barbell 10 Barbell 11 Barbell 12 Barbell 13 Barbell 14 Barbell 15 Barbell 16 34.09 0 34.09 50 23.76 48 34.36 48 28.47 39 38.49 39 36.15 31 46.8 31 25.46 26 34.67 26 30.96 19 40.92 19 24.57 14 33.87 14 16 9 37 9 15.6 4 35.56 4 4 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow DCF - Improvement Plan Note: Cash taxes provided by management for 2007-2010 and are projected at a 35% tax rate thereafter; net debt includes $256mm of off-balance sheet debt 1 Other includes tooling & engineering, pension contributions and $120mm cash impact from interiors business in 2007 5 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow DCF - Sensitivity case Note: Net debt includes $256mm of off balance sheet debt; Cash taxes provided by management for 2007-2010 and are projected at a 35% tax rate thereafter 1 Other includes tooling & engineering, pension contributions and $120mm cash impact from interiors business in 2007 2 Includes $50mm in supplier support payments in 2007 and $25mm cash outflow each year from 2007 - 2010 for investments in capacity reductions and other 6 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow LBO valuation analysis - Improvement Plan Note: 2006 EBITDA is pro forma ($92)mm for the divestiture of interiors, weighted cost of debt is of 8.125%, 5% management promote; net debt includes $256mm of off- balance sheet debt 1 Other includes tooling & engineering and pension contributions 2 Includes a $120mm cash impact from interiors business in 2007 7 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow LBO valuation analysis - Sensitivity case Note: 2006 EBITDA is pro forma ($92)mm for the divestiture of interiors, weighted cost of debt is of 8.125%, 5% management promote; net debt includes $256mm of off-balance sheet debt 1 Other includes tooling & engineering and pension contributions 2 Includes a $120mm cash impact from interiors business in 2007 3 Includes $50mm in supplier support payments in 2007 and $25mm cash outflow each year from 2007 - 2010 for investments in capacity reductions and other 8 L O N G B O W V A L U A T I O N U P D A T E |
| Longbow analysis at various prices Note: Current share price of $34.60 as of 1/29/07; Net debt of $2,035mm based on 12/31/06 debt (excludes off balance sheet debt to match equity analyst multiples); includes minority interest of $38mm; 2006A financials are pro forma for the divestiture of the interiors business Longbow analysis at various prices ($mm, except per share data) 9 L O N G B O W V A L U A T I O N U P D A T E |
| Automotive supplier trading comparables $ millions, except as noted Source: Bloomberg, Company filings, equity research Note: Market data as of 2/1/07; trading multiples not burdened by off balance sheet debt to match equity analyst multiples 10 L O N G B O W V A L U A T I O N U P D A T E |
| Automotive supplier transaction comparables European N. American Asian LBO Bridgestone 10.6 Robert Bosch GMBH 5.36 Hitachi Clarion 8.4 Asahi Tec 6 Platinum Equity Red Diamon Avon Autmotive 4.2 Continental 8.9 Bain Capital 10.1 Cooper Standard 4.6 One Equity 6.8 Carlyle 9 JCI Delphi's battery business 4 n n CVG MVS 4.3 N N Valeo Johnson Controls 9.5 E E BorgWarner Beru 6.5 N N Magna International Tesma International 5.5 N N Magna International Decoma International 3.4 N N Cypress Group Cooper-Standard 8.5 L L Cypress Group Dana AAG 6.1 L L TH Lee Progressive Moulded Products 7 Montagu Private Equity Stabilus 6.4 L L Kohlberg Co LLC Stanadyne 7 L L GS Capital Partners Autocam 7 L L Continental Phoenix AG 5.8 L E Vestar FL Selenia (Doughty Hanson) 7.9 N L HG Capital W.E.T. Automotive Systems 4.9 E L Tomkins PLC Stackpole 6.2 L N The Carlyle Group UIS 6.1 L L Rheinmetall AG Kolbenschmidt Pierburg 3.1 N E Castle Harlan, Inc. Advanced Accessory Systems 5.6 L L Blackstone Group TRW Automotive 4.9 E L Carlyle Group Edscha 4.9 L L CVC Kwikfit 3.6 L L Johnson Controls Varta Automotive Batteries 5.7 L E Questor/Investors Teksid Aluminum SpA 6.8 L L Magna International Donnelly Corp 8.9 E N Doughty Hanson A.T.U. 10.5 L L Hitachi Unisia Jecs 4.8 N A CSFB Oxford Automotive 4.9 L L INA FAG Kugelfischer 4.2 A E Collins & Aikman Textron Automotive Trim 5.6 L N ZF Sachs 5.4 E E Johnson Controls Sagem Electronics 7.9 N E Schroder Ventures Grammer 4 E L TI sharehlders TI Automotive (spin-off) 4.3 E E Delphi Automotive Eaton's Switch Division 7.1 L N Heartland Collins & Aikman 5.9 E L CVC Delco Remy 4.8 N N Faurecia SA SAI 7.7 L E GenCorp Laird-Draftex 4 N E Heartland Simpson Industries, Inc 5.6 E L Heartland MascoTech, Inc. 6.7 E L DaimlerChrysler AG Detroit Diesel Corp 5.6 L N HSBC BBA Automotive Friction 7.1 L L Parker Hannifin Corp Wynn's International 7.6 N N Schroder Ventures Kiekert AG 7.2 L L BC Partners Mark IV 7 N L Exide Corp GNB Battery Business 5.9 L A Meridian Automotive Cambridge Industries Inc 8.1 L N Fiat Spa Magneti Marelli (buy-out) 7.2 A E Valeo SA Labinal Auto (Sylea SA) 9.53 N E Meritor Automotive Arvin Industries 4.3 E N Siemens/Robert Bosch Mannesman AG - Atecs 8.7 E E Autoliv Inc OEA Inc 9.7 N E Saw Mill Capital Fund Jason Inc 5.5 E L Carlyle Group Tritech Precision & Trimin 5.5 E L Source: Company filings, analyst reports and JPMorgan estimates Note: Select announced domestic and cross-border deals as of 01/30/07 6.1x 11 L O N G B O W V A L U A T I O N U P D A T E |
| Appendix (pages from July valuation book) Longbow valuation update 12 Longbow valuation July 2006 1 1 2 12 V A L U A T I O N M A T E R I A L S |
| Summary of financial projections - by division 1 Net of intercompany sales and corporate overhead Seating Electronics and Electrical Interiors Consolidated1 13 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Indicative equity value per share Longbow valuation Mean Barbell 1 Barbell 2 Barbell 3 Barbell 4 Barbell 5 Barbell 6 Barbell 7 Barbell 8 Barbell 9 Barbell 10 Barbell 11 Barbell 12 Barbell 13 Barbell 14 Barbell 15 Barbell 16 25.29 11 14.81 11 30.54 10 20.05 10 46 8.5 33.42 8.5 35.28 8 25.15 8 22.73 7.5 13.27 7.5 27.44 6 16.81 6 28.65 4.2 17.65 4.2 26.35 3.7 16.1 3.7 18.2 3.2 10 3.2 30 2 14 2 45 1 15.65 1 21.45 0 21.45 12.5 $20.05 $30.22 Transaction comparables1 5.0-6.0x 2006E EBITDA ($706mm) Midpoint of value range $22.13 Trading comparables1 4.5-5.5x 2006E EBITDA ($706mm) $39.71 $25.30 Sum of the parts1,2 Analyst price targets1 52-week trading range1 $23.15 $21.23 Current Price Improvement Plan Partial Improvement Plan Sensitivity case $18.00 $22.00 $14.10 $30.33 DCF Partial Improvement Plan LBO Improvement Plan Sensitivity case Note:2006E EBITDA without restructuring costs is $820mm 1 Trading multiple range and net debt figures not burdened by off balance sheet debt to match equity analyst multiples 2 Divested Interiors value assumed to be negative $150mm. This is the estimated amount of cash that Longbow would need to exit the Interiors business 14 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Longbow DCF - Improvement Plan Note: Assumes 6/30/06 valuation date; cash taxes provided by management 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings 15 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| LBO valuation analysis - Improvement Plan Note: Assumes half of free cash flows available for debt service in 2006 and 2011 due to 6/30 entry and exit date, 9.0% interest rate on 1st lien debt, 12.0% interest rate on 2nd lien debt, $76mm transaction fees, $120mm minimum cash and 5% management promote; cash taxes provided by management 1 Other includes other expense, Tooling & Engineering, non-cash pension expense, minority interest and equity earnings 2 Includes off balance sheet debt 16 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Longbow DCF - Sensitivity Case Note: Assumes 6/30/06 valuation date; cash taxes provided by management 1 Other includes other expense, tooling & engineering, non-cash pension expense, minority interest and equity earnings + cash impact of distressed supplier support payments, financing fees and incremental investment in JVs 17 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| LBO Sensitivity case Page not included in July 2006 board book 18 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Longbow analysis at various prices Note: Net debt of $2,181mm based on LTM 3/31/06 total debt (excluding ABS and factoring to match equity analyst multiples) pro forma for $1bn term loan issuance, repayment of $400mm term loan and $273mm convert tender 19 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Auto suppliers trading comparables Source: Bloomberg, Company filings, equity research Note: Market data as of 7/6/2006; trading multiples not burdened by off balance sheet debt to match equity analyst multiples 20 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Auto-parts M&A transaction multiples since 2000 Date Acquirer Target Total cost (FV) FV/ sales FV/ EBIT FV/EBITDA multiple LBO 6.0 5.1 6.0 3.0 4.9 7.9 5.8 6.4 2.6 7.0 3.6 6.2 5.0 5.4 01-Nov-04 Borg Warner Beru AG 543 1.41x 9.1x 29-Mar-04 Continental Phoenix 554 0.48x 12.5x 23-May-03 FINM (Manuli family) Manuli Rubber Industries 177 0.51x 4.9x 30-Apr-03 Tomkins Stackpole 190 1.03x 8.7x 3.1 07-Apr-03 Rheinmetall Kolbenschmidt Pierburg 680 0.36x 8.5x 09-Dec-04 Electra TK Fahrzeugguss 155 0.55x 5.7x 17-Sep-04 Cypress & GS PE Cooper Standard Automotive 1,165 0.64x 7.8x ? 08-Sep-04 Ripplewood Honsel 625 0.71x 11.3x ? 19-Jul-04 Cerberus GDX Automotive 147 0.19x 11.0x ? 09-Jul-04 Cypress Group Dana AAG 1,100 0.55x 8.0x ? 02-Jul-04 Montagu Stabilus N/D 1.30x 8.4x ? 03-May-04 GS Capital Partners Autocam 390 1.21x ? 04-Sep-03 Vestar Capital FL Selenia (Doughty Hanson) 670 1.4x 20.3x ? 28-May-03 HG Capital W.E.T. Automotive Systems 178 1.00x 6.1x ? 30-Apr-03 Carlyle UIS 800 0.86x ? 6.8 6.0 4.1 6.0 6.5 4.9 4.2 5.8 5.4 7.9 4.0 7.2 7.3 4.3 7.1 5.7 5.0 7.5 4.0 6.8 7.1 5.9 5.2 7.2 4.4 5.5 8.3 4.5 3.4 6.0 3.8 9.3 5.7 3.6 5.7 4.9 4.8 10.5 06-Aug-02 Johnson Controls Varta Automotive batteries 307 0.53x 10.8x 13-May-02 Hilite Siemens Hydraulik-Ring 113 0.95x 10.4x 18-Apr-02 Hitachi Unisia Jecs 530 0.35x 46.0x 22-Mar-02 GKN Tochigi Fuji Industrials (33.3%) 90 0.33x 07-Mar-02 Concordia Finance Magneti Marelli Aftermarket 71 0.31x 7.7x 10-Sep-01 INA FAG Kugelfischer 1,135 0.51x 7.7x 03-Aug-01 ZF Friedrichshafen Sachs 1,200 0.57x 25-Jul-01 Johnson Controls Sagem automotive electronics 435 0.83x 14.0x 02-Apr-01 Continental DaimlerChrysler TEMIC 553 0.60x 18.5x 22-Mar-01 ThyssenKrupp Magneti Marelli Suspensions 489 0.52x 12-Mar-01 Delphi Eaton 300 0.90x 15-Nov-00 Trelleborg Laird Automotive Component 148 0.50x 25-Oct-00 Faurecia SAI 1,670 0.70x 13.5x 23-Oct-00 GenCorp Laird-Draftex 204 13-Jun-00 Schroder Ventures Kiekert 438 0.70x 8.4x 08-May-00 Valeo Labinal 441 0.39x 7.5x 05-May-00 Fiat Magneti Marelli (buyout) 2,007 0.35x 31.7x 14-Apr-00 Bosch/Siemens ATECS 9,600 0.77x 17.1x 06-Apr-00 Meritor Arvin 1,255 0.40x 7.5x 04-Jan-00 Trelleborg Invensys AVS Business 250 0.49x 8.1x 25-Jun-02 Magna Donnelly Corporation 0.45x 16.2x 411 19-Nov-02 Blackstone TRW Automotive 4,725 0.45x 10.0x ? 12-Nov-02 Carlyle Edscha 514 0.58x 7.8x ? 30-Sep-02 Questor Teksid 482 0.56x ? 12-Aug-02 CVC Kwikfit 330 0.40x 5.1x ? 20-Jan-02 Doughty Hanson A.T.U. 1,030 1.11x 13.9x ? 18-Jan-02 CSFB Global Opps. Oxford Automotive 243 0.30x 25.3x ? 07-Aug-01 Collins & Aikman Textron automotive trim division 1,335 0.71x ? 27-Apr-01 Schroder Ventures Grammer 256 0.38x 6.2x ? 14-Mar-01 TI Shareholders TI Automotive (Spin off) 1,389 0.59x 5.5x ? 12-Jan-01 Heartland Collins & Aikman 1,280 0.67x 8.4x ? 10-Aug-00 Heartland MascoTech 2,129 1.23x 9.4x ? 01-Jul-00 HSBC BBA Automotive friction 586 1.26x 9.8x ? 05-Jun-00 Peter Cherry Cherry 180 0.50x 18.7x ? 29-May-00 BC Partners Mark IV 2,000 1.03x 10.2x ? 28-Jan-00 CVC Capital Partners Invensys Sealing Systems 400 0.39x 7.3x ? 10-Jan-00 JLL Hayes-Lemmerz 2,265 1.05x 9.2x ? 07-Jan-00 Carlyle Group Tritech Precision and Trimin 546 1.45x 17.1x ? 07-Jun-05 Inssec Cie Automotive SA 0.81x 14.3x 14-Jul-05 Deutsche Bank Grammer 0.39x 8.0x 26-Aug-05 Johnson Electric Saia-Burgess 767 1.28x 14.9x 547 319 10.2 4.8 6.0 05-Dec-05 Cooper-Standard ITT Auto Brake & Fuel Tubing Business 205 0.49x 8.2x 4.9 9.5x 09-Jan-06 Bain TI Sensors and Controls 3,000 2.80x 10.9x 03-Apr-06 Continental Motorola Automotive $1,000 0.63x Source: Securities Data Corporation, public information Note: Only transactions with FV/EBITDA multiple shown European target US target Asian target N/A 13-Jan-03 TI Automotive Kolbenschmidt Pierburg fuel pumps division N/A N/A N/A 06-Sep-05 TRW Dalphi Metal Espana 306 0.60x 23-Sep-05 Carlyle Group AxleTech 350 1.40x 9.0x 9.0 N/A 4.0 22-Mar-05 Johnson Controls Delphi (Battery) 213 0.35x 4.0x ? ? ? ? N/A 21 A P P E N D I X ( P A G E S F R O M J U L Y V A L U A T I O N B O O K ) |
| Exhibit ( c ) ( 5 ) Consolidated Lear CONFIDENTIAL r Inprovoment Plan — Rkks IOpportunltbs ?OOb 2006 2007Phn 2006 Plan ZOOS Plan M I 0Plan ($ millions) Attuds A d u l k (Roviud). (Base) (Base) (Base) Sales — Cmmercid f 17,069.2 $ 17.838.9 f 15,104.4 5 14,805.6 f 14,492.3 S 14.809.5 W- htarcompany -— WS- T&I S 1 7 W 2 S 17.83U.9 S 16,104.4 $ 14,806.6 S 144(923 $ 14,909.6 Totd Cmt d Goods Sdd 16,3532 16,9112 14.009.8 13,660.0 13283.5 13,614.9 TOWCOGS as % dSaks 95.7% 94.8% 92.8% 92.3% 91.7% 81.3% Grora Margin 736.0 927.7 1,094.6 1,1464 1,208.9 1JM-7 % sakrs 4.3% 52% 7.2% 7.7% 8.3% 8.7% S W 630.6 646.8 607.0 560.9 524.8 514.1 % sdes 3.7% 3.6% 4.0% 3.8% 3.6% 3.4% Opentlng in- 106.4 281.0 487.6 664.6 684.1 780.5 % sales 0.6% 1.6% 3.2% 3.9% 4.796 52% EBlTDA 498.8 6732 8102 924.6 1,009.7 1,089.4 Depreciation and Amortaaticm 393.4 3922 322.6 339.9 325.7 308.8 Capital Eqwndw~s 568.4 347.6 246.1 234.8 249.7 225.0 Restructuring Costs (01) (106.3) (106.6) (104.2) (120.6) (67.8) (45.8) ( ~ k ~ n c . b 4 ebal4CN41nnaa=tmmstulyo1cbssm,I h hc-radwlM)opnbom11m2a)7srb.afs144 rn wt hld%l S 1 1 2 ~ M d I l O . O M 0 f D h e r t p ~ c s l ~ ~ m Z dm,O M nrpes~i*all Dlrsctbnai Fhanciel tnp.ct to Above Rkk IOpportunityto Long Ranq. Plan 2008 2008 2010 Sn*s EBlTDA S.k8 EBlTDA S.kr EBlTDA Volume 1Mix- North Amrlw (Cumnt Industry Outlook) $ (610) $ 1st) $ (786) S (79) $ (976) $ (97) — Key Worms = 75% of NA Seam Sales. 50% d NA UE Sales Prodoction O W per JD Ponerb d e c h : demand and capacity reducliwr Dom 3 m m cdnits ill i’Om2010 - - Big Three Production Outlook per JOP durn -BMlK units in X109 12010 timahame — Fbed cost / capacity reductions to conversion bebw historicsl variable magin Conquon Buslnos8 — Norm Am- EkctrlcPl IElectronicr $ l S O $ 1 6 1 9 0 s 1 9 280s 28 Purchnaing: CMnnodlty Prkos, SuppUor Conpnuion, I-rclng t 16 $ 3 0 $ 4 0 Pshn Margin IChina Produdion Vdumss — Soatlng $ 6 0 s 10 $ 6 0 s 10 $ 5 0 s 10 lnteriora Transrctlon Pssumptlona S (363) $ (19) $ (114) S Cr) S (76) $ (6) — C m Asian IA s ‘ i OEM operaticns no bnger to be retained Corporate HQ Cost re duct lo^ $ 10 $ I 0 f 10 FIX Rntos $ 615 $ 30 $ 690 $ 27 S 666 $ 26 — Ewo assumption increased to l.Wfrom 120/5 |