SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the period ended January 31, 1995
or
[ ] Transition Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the transition period from to
Commission file number 0-8454
JLG Industries, Inc.
(Exact name of registrant as specified in its charter)
Pennsylvania 25-1199382
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1 JLG Drive, McConnellsburg, PA 17233
(Address of Principal Executive Offices) (Zip Code)
(7l7) 485-5161
Registrant's telephone number, including area code
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No _________
At March 12, 1995, there were 3,661,155 shares of capital stock of the
Registrant outstanding, and the aggregate market value of the voting stock held
by nonaffiliates of the Registrant at that date was $144,226,778.
PART I FINANCIAL INFORMATION
JLG INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
January 31, July 31,
1995 1994
(Unaudited)
ASSETS
Current assets
Cash $4,264 $8,088
Accounts receivable 27,801 25,750
Inventories:
Finished goods 7,751 4,968
Work in process 10,276 9,242
Raw materials 11,584 9,012
29,611 23,222
Future income tax benefits 3,587 3,531
Other current assets 1,201 1,871
Total Current Assets 66,464 62,462
Property, plant and equipment - net 21,879 19,344
Equipment held for rental - net 4,233 4,190
Other assets 5,458 5,638
$98,034 $91,634
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $1,254 $1,301
Accounts payable 14,026 14,770
Accrued expenses 13,141 14,011
Total Current Liabilities 28,421 30,082
Long-term debt 5,631 6,277
Other deferred credits and liabilities 8,846 9,569
Shareholders' equity
Capital stock:
Authorized shares: 10,000 at $.20 par
Outstanding shares: 1995 - 7,114
shares, net of 300 treasury shares;
1994 - 6,984 shares 1,483 1,469
Additional paid-in capital 13,690 12,331
Equity adjustment from translation (1,807) (1,899)
Retained earnings 44,324 36,884
Treasury stock (2,554) (3,079)
Total Shareholders' Equity 55,136 45,706
$98,034 $91,634
The accompanying notes are an integral part of these financial statements.
JLG INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands)
(Unaudited)
Three Months Ended Six Months Ended
January 31, January 31,
1995 1994 1995 1994
Net sales $52,175 $34,172 $105,899 $70,929
Cost of sales 38,726 26,407 79,466 54,535
Gross profit 13,449 7,765 26,433 16,394
Selling, general and
administrative expenses 7,717 5,963 14,505 12,492
Income from operations 5,732 1,802 11,928 3,902
Other deductions:
Interest expense (125) (93) (237) (170)
Miscellaneous, net 137 (28) 26 (61)
Income before taxes 5,744 1,681 11,717 3,671
Income tax provision 1,992 586 4,102 1,325
Net income $3,752 $1,095 $7,615 $2,346
Net income per share $.53 $.16 $1.08 $.33
Dividends per share $.0125 $.0125 $.025 $.025
Weighted average
shares outstanding 7,074 6,922 7,044 7,018
The accompanying notes are an integral part of these financial statements.
JLG INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Six Months Ended
January 31,
1995 1994
OPERATIONS:
Net income $7,615 $2,346
Adjustments to reconcile net income to cash
(used for) provided by operating activities:
Depreciation and amortization 1,567 1,335
Provision for self-insured losses 43 897
Deferred income taxes 91 (320)
9,316 4,258
Changes in operating assets and
liabilities (9,577) (5,968)
Changes in other assets and liabilities (494) (813)
Cash used for operations (755) (2,523)
INVESTMENTS:
Purchases of property, plant and
equipment (3,183) (3,443)
FINANCING:
Issuance of short-term debt 1,711
Issuance of long-term debt 5,036
Repayment of long-term debt (701) (1,544)
Payment of dividends (176) (178)
Capital stock contributed to employee
stock ownership plan 1,159 625
Acquisition of treasury stock (3,500)
Cash provided by financing 282 2,150
CURRENCY ADJUSTMENTS - effect of exchange rate
changes on cash flows (168) (28)
CASH:
Net decrease (3,824) (3,844)
Beginning balance 8,088 4,848
Ending balance $4,264 $1,004
The accompanying notes are an integral part of these financial statements.
JLG INDUSTRIES, INC.
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
January 31 1995
(unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with instructions to Form 10-Q and therefore, do
not include all information and notes necessary for a fair presentation of
financial position, results of operations and cash flows in conformity with
generally accepted accounting principles. However, such financial statements
include all adjustments (consisting only of normal recurring accruals) which
management of the Company considers necessary for a fair presentation of the
results of operations.
Interim results for the six months ended January 31, 1995 are not necessarily
an indication of the results for the fiscal year as a whole. For further
information, refer to consolidated financial statements and notes included in
the Form 10-K filing for the fiscal year ended July 31, 1994.
NOTE B - INVENTORIES AND COST OF SALES
A precise inventory valuation under the LIFO (last-in, first-out) method can
only be made at the end of each fiscal year; therefore, interim LIFO inventory
valuation determinations, including the determination at January 31, 1995, must
necessarily be based on management's estimate of expected fiscal year-end
inventory levels and costs.
NOTE C - COMMITMENTS AND CONTINGENCIES
The Company is a party to personal injury and property damage litigation
arising out of incidents involving the use of its products. Annually the
Company sets its product liability insurance program based on the Company's
current and historical claims experience and the availability and cost of
insurance. The combination of these annual programs constitutes the Company's
aggregate product liability insurance coverage. The Company's program for
fiscal year 1995 is comprised of a self-insurance retention of $5 million and
catastrophic coverage of $20 million in excess of the retention.
Cumulative amounts estimated to be payable by the Company with respect to
pending product liability claims for all years in which the Company is liable
under its self-insurance retention have been accrued as other deferred credits
and other liabilities, including $2.4 million for incidents the Company
believes may result in claims. Estimates of such accrued liabilities are based
on an evaluation of the merits of individual claims and historic claims
experience; thus, the Company's ultimate liability may exceed or be less than
the amounts accrued. Amounts accrued are paid over varying periods, which
generally do not exceed five years. The methods of making such estimates and
establishing the resulting accrued liability are reviewed continually and any
adjustments resulting therefrom are reflected in current earnings.
NOTE D - SUBSEQUENT EVENT
On February 23, 1995, the Company declared a two-for-one split of the Company's
outstanding common stock and adopted a resolution restoring 150,232 treasury
shares to the status of authorized but unissued shares. The two-for-one split
will be effected by a stock dividend to be distributed on April 3, 1995 to
shareholders of record at the close of business on March 15, 1995. Accordingly,
the number of shares outstanding and the per share amounts in the accompanying
financial statements have been restated to give effect to the stock split.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information given below is intended to assist in understanding the
Company's financial condition and results of operations as reflected in the
Condensed Consolidated Financial Statements (pages 3 through 7).
As a manufacturer of capital goods, the Company is primarily dependent upon
sales to the construction and industrial sectors of the economy. Business in
these sectors, particularly the construction sector, tends to be cyclical;
thus, demand for the Company's products, and ultimately the Company's financial
performance and cash flows, tends to fluctuate in response to the business
cycles within these sectors.
LIQUIDITY AND SOURCES OF CAPITAL
Current assets as a percent of current liabilities were 234% at January 31,
1995, compared to 208% at July 31, 1994. Working capital was $38.0 million at
January 31, 1995, compared to $32.4 million at July 31, 1994. The improvement
in the percentage of current assets to current liabilities and the increased
working capital at January 31, 1995, were primarily due to higher inventory and
accounts receivable levels to support the increased growth in sales.
At January 31, 1995, the Company had unused credit lines totaling $11 million
and cash balances of $4.3 million. The Company considers these resources,
coupled with cash expected to be generated by operations, adequate to fund its
anticipated fiscal 1995 working capital and estimated capital expenditure
needs.
The Company's exposure to product liability claims is discussed in NOTE C -
COMMITMENTS AND CONTINGENCIES. Future results of operations, financial
condition and liquidity may be affected to the extent that the Company's
ultimate liability with respect to product liability varies from current
estimates.
RESULTS FOR THE SECOND QUARTERS OF FISCAL 1995 AND 1994
et sales for the second quarter of fiscal 1995 were $52.2 million, an increase
of $18.0 million, or 53% from the previous year. The growth in revenues was
due to increased demand across virtually all product classes.
Gross profit, as a percent of net sales, increased to 26% in the second quarter
of fiscal 1995 from 23% the previous year. Contributing to the increase were
continued improvements in manufacturing processes, lower product liability and
warranty costs and higher selling prices. These improvements were partially
offset by increased cost of materials, including subcontracting costs, and
training costs associated with an expanding workforce.
Selling, general and administrative expenses for the second quarter of fiscal
1995 increased 29% or $1.8 million compared to the same period of fiscal 1994,
but decreased as a percent of sales to 15% from 17%. The increase in spending
is primarily volume-related and includes higher payroll and related costs,
increased research and development expenses and consulting costs.
The effective tax rate was 35% for the second quarter of both fiscal 1995 and
1994.
RESULTS FOR THE FIRST SIX MONTHS OF FISCAL 1995 AND 1994
Net sales for the first six months of fiscal 1995 were $105.9 million, an
increase of $35.0 million, or 49% from the previous year. As noted in the
second quarter comparison, virtually all product lines contributed to the
increase.
Gross profit, as a percent of net sales, increased to 25% in the first six
months of fiscal 1995 from 23% the previous year. The increase was essentially
due to the same factors as discussed in the second quarter comparison.
Selling, general and administrative expenses for the first six months of fiscal
1995 increased 16% or $2.0 million compared to the same period of fiscal 1994,
but decreased as a percent of sales to 14% from 18%. The dollar increase over
last year was due to the factors discussed in the second quarter comparison,
with the exception that the prior year period had higher legal costs associated
with the settlement of litigation with the Company's then principal
shareholder.
The effective tax rate was 35% in the first six months of fiscal 1995, compared
to 36% in the fiscal 1994 period. The lower tax rate for the fiscal 1995
period was due to a revision in the estimate of future taxes payable
Ernst & Young LLP
Independent Auditors' Review Report
The Board of Directors
JLG Industries, Inc.
We have reviewed the accompanying condensed consolidated balance sheet of JLG
Industries, Inc. and subsidiaries as of January 31, 1995, and the related
condensed consolidated statements of income for the three-month and six-month
periods ended January 31, 1995 and 1994, and the condensed consolidated
statements of cash flows for the six-month periods ended January 31, 1995 and
1994. These financial statements are the responsibility of the Company's
management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data, and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, which will be
performed for the full year with the objective of expressing an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to the accompanying condensed consolidated financial statements
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of JLG Industries, Inc. as of July
31, 1994, and the related consolidated statements of income, shareholders'
equity and cash flows for the year then ended, not presented herein, and in our
report dated September 8, 1994, we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth
in the accompanying condensed consolidated balance sheet as of July 31, 1994,
is fairly stated, in all material respects, in relation to the consolidated
balance sheet from which it has been derived.
February 15, 1995, except for Note D, Ernst & Young LLP
as to which the date is February 23, 1995
PART II OTHER INFORMATION
Items 1 - 5
None/not applicable.
Item 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are included herein:
3 Amended and Restated By-Laws
15 Letter re: Unaudited Interim Financial Information
(b) The Company was not required to file Form 8-K pursuant to
requirements of such form for any of the three months ended January 31,
1995.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized who is also signing in his capacity as
principal financial officer.
JLG INDUSTRIES, INC.
(Registrant)
/s/ Charles H. Diller, Jr.
Charles H. Diller, Jr.
Executive Vice President and
Chief Financial Officer
EXHIBIT 3
BY-LAWS
OF JLG INDUSTRIES, INC.
(A Pennsylvania Corporation)
OFFICES
1. The registered office shall be at P.O. Box 695,
McConnellsburg, Pennsylvania 17233.
2. The Corporation may also have offices at such other places
as the Board of Directors may from time to time appoint or the
business of the Corporation may require.
SEAL
3. The corporate seal shall have inscribed thereon the name of
the Corporation, the year of its organization and the words "Corporate
Seal, Pennsylvania".
SHAREHOLDERS' MEETING
4. All meetings of the shareholders shall be held at such place
within or without the Commonwealth of Pennsylvania as the Board of
Directors may designate from time to time and in the absence of such
designation shall be held at the principal office of the Corporation
in Ayr Township, Pennsylvania.
5. The annual meeting of the shareholders shall be held on the
fourth Monday of November in each year, or at such other date as may
be fixed by the Board of Directors, in order to elect the Board of
Directors of the Corporation and transact such other business as may
properly be brought before the meeting. If the annual meeting shall
not be called and held within six months after the fourth Monday in
November, any shareholder may call such meeting.
6. The presence, in person or by proxy, of the holders of a
majority of the outstanding shares entitled to vote, shall constitute
a quorum at all meetings of the shareholders for the transaction of
business except as otherwise provided by law, by articles of
incorporation or by these by-laws. If however, such quorum shall not
be present or represented at any meeting of the shareholders, those
entitled to vote thereat, present in person or represented by proxy,
shall have power to adjourn the meeting from time to time, without
notice other than announcement at the meeting, until the requisite
number of shares shall be present. In the case of any meeting called
for the election of directors, adjournment or adjournments may be
taken only from day to day until such directors have been elected, and
those who attend the second of such adjourned meetings, although less
than a quorum, shall nevertheless constitute a quorum for the purpose
of electing directors.
7. At each meeting of the shareholders every shareholder having
the right to vote shall be entitled to vote in person or by proxy
appointed by an instrument in writing subscribed by such shareholder
and delivered to the Secretary at or prior to the meeting. No
unrevoked proxy shall be valid after eleven months from the date of
its execution, unless a longer time is expressly provided therein, but
in no event shall a proxy, unless coupled with an interest, be voted
on after three years from the date of its execution. In all elections
for directors cumulative voting shall not be permitted. No share
shall be voted at any meeting upon which any installment is due and
unpaid. The original share ledger or transfer book, or a duplicate
thereof kept in this Commonwealth shall be prima facie evidence of the
right of the person named therein to vote thereon.
8. Written notice of the annual meeting shall be mailed to each
shareholder entitled to vote thereat, at such address as appears on
the books of the Corporation, at least five days prior to the meeting.
9. In advance of any meeting of shareholders, the Board of
Directors may appoint judges of election, who need not be
shareholders, to act at such meeting or any adjournment thereof. If
judges of election be not so appointed, the chairman of any such
meeting may, and on the request of any shareholders or his proxy,
shall make such appointment at the meeting. The number of judges may
be one or three. If appointed at a meeting on the request of one or
more shareholders or proxies, the majority of shares present and
entitled to vote shall determine whether one or three judges are to be
appointed. On request of the chairman of the meeting, or of any
shareholder or his proxy, the judges shall make a report in writing of
any challenge or question or matter determined by them, and execute a
certificate of any fact found by them. No person who is a candidate
for office shall act as a judge.
10. Special meetings of the shareholders may be called at any
time by resolution adopted by the Board of Directors. At any time
upon adoption of a resolution by the Board of Directors to call a
special meeting, it shall be the duty of the Secretary to call a
special meeting of the shareholders, to be held at such time as the
Secretary may fix, not less than 10 nor more than 60 days after
receipt of the request.
11. Business transacted at all special meetings shall be
confined to the objects stated in the call and matters germane
thereto.
12. Written notice of a special meeting of the shareholders,
stating the time and place and object thereof, shall be mailed,
postage prepaid, to each shareholder entitled to vote thereat at such
address as appears on the books of the Corporation, at least five days
before such meeting, unless a greater period of notice is required by
statute in a particular case.
VOTING LIST
13. The officer or agent having charge of the transfer books
shall make a complete list of the shareholders entitled to vote at the
meetings, arranged in alphabetical order, with the address of and the
number of shares held by each. Such list shall be produced and kept
open at the time and places of the meeting, and shall be subject to
the inspection of any such shareholder during the whole time of the
meeting. The original share ledger or transfer book, or a duplicate
thereof kept in this Commonwealth, shall be prima facie evidence as to
who are the shareholders entitled to examine such list or share ledger
or transfer book, or to vote in person or by proxy, at any meeting of
shareholders.
DIRECTORS
14. The business of this Corporation shall be managed by its
Board of Directors, which shall consist of such number of persons, not
less than three and nor more than nine, as may be determined from time
to time by the Board of Directors; provided that no determination by
the Board of Directors may reduce the term of office of any incumbent
director. Directors shall be elected by the shareholders at the
annual meeting of shareholders of the Corporation. Any person to be
eligible for election by the shareholders must meet the requirements
of a "Qualified Nominee" as defined below in this Section and must be
nominated by either the Board of Directors or by a shareholder or
group of shareholders that own, as reflected on the Corporation's
share register, at least one share of company stock that is then
currently entitled to vote. Any such nominations by persons other
than the Board of Directors must be received by the Secretary of the
Corporation no later than such date determined by the Board of
Directors not more than 90 days prior to the date of the annual
meeting accompanied by written statements signed by each person so
nominated setting forth all information in respect of such person
required by Items 401, 403, 404 and 405 of Regulation S-K promulgated
by the Securities and Exchange Commission and stating that such person
consents to such nomination and consents to serve as a Director of the
Corporation if elected. A person will be a "Qualified Nominee" if
such person (A)(i) beneficially owns at least one thousand shares of
the Corporation's Common Stock, par value $.20 per share, such amount
to be adjusted from time to time following November 22, 1993, by any
stock split, stock dividend, reclassification or recapitalization by
the Corporation (the "Minimum Shares"), or (ii) commits to the
Company in writing to purchase the Minimum Shares within 18 months of
being nominated as a director candidate, provided that any person who
fails to acquire the Minimum Shares within 18 months of being
nominated may not be considered a Qualified Nominee until such person
beneficially owns the Minimum Shares, and (B) will not reach age 70
prior to the next scheduled annual meeting of shareholders; provided,
that any incumbent Director as of November 22, 1993, who at that date
is age 68 or older shall remain a Qualified Nominee so long as he
shall not reach age 72 prior to the next scheduled meeting of
shareholders; provided, further, that any incumbent Director as of
November 22, 1993, who at that date is age 72 shall remain a Qualified
Nominee so long as he shall not reach age 73 prior to the next
scheduled annual meeting of shareholders.
15. In addition to the powers and authorities by these by-laws
expressly conferred upon them, the Board may exercise all such powers
of the Corporation and do all such lawful acts and things as are not
be statute or by the articles of incorporation or by these by-laws
directed or required to be exercised or done by the shareholders.
MEETINGS OF THE BOARD OF DIRECTORS
16. The meetings of the Board of Directors may be held at such
place within this Commonwealth, or elsewhere, as a majority of the
directors may from time to time appoint, or as may be designated in
the notice calling the meeting.
17. Each newly elected Board may meet at such place and time as
shall be fixed by the shareholders at the meeting at which such
directors are elected, and no notice shall be necessary to the newly
elected directors in order legally to constitute the meeting, or they
may meet at such place and time as may be fixed by the consent in
writing of all the directors.
18. Regular meetings of the Board shall be held without notice
at such time and place as shall be determined by the Board.
19. Special meetings of the Board may be called by the Chairman
of the Board on at least three days notice to each director, either
personally or by mail or by telegram; special meetings shall be called
by the Chairman of the Board of Secretary in a like manner and on like
notice on the written request of two directors, or more.
20. A majority of the directors in office shall be necessary to
constitute a quorum for the transaction of business, and the acts of a
majority of the directors present at a meeting at which a quorum is
present shall be the acts of the Board of Directors. If all the
directors shall severally or collectively consent in writing to any
action to be taken by the Corporation, such action shall be as valid
corporate action as though it had been authorized at a meeting of the
Board of Directors.
21. The Board of Directors may, by resolution passed by a
majority of the whole Board, designate one or more committees, each
committee to consist of two or more of the directors of the
Corporation. The Board may designate one or more directors as
alternate members of any committee, who may replace any absent or
disqualified member at any meeting of the committee. Any such
committee, to the extent provided by resolution of the Board of
Directors, shall have and shall exercise the powers of the Board of
Directors in the management of the business and affairs of the
Corporation, and may authorize the seal of the Corporation to be
affixed to all papers which may require it. In the absence or
disqualification of any member of any such committee or committees,
the member of members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a
quorum, may, by unanimous vote, appoint another member of the Board of
Directors to act at the meeting in place of any such absent or
disqualified member.
LIABILITY OF DIRECTORS
22. A director, as such, shall not be personally liable for
monetary damages for any action taken, or any failure to take any
action, unless the director has breached or failed to perform the
duties of his or her office under 42 Pa. C.S. Section 8363 and the
breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness. The provisions of this Section shall not
apply to the responsibility or liability of a director pursuant to any
criminal statue or the liability of a director for the payment of
taxes pursuant to local, state or federal law.
COMPENSATION OF DIRECTORS
23. Directors as such, shall not receive any stated salary for
their services, but by resolution of the Board, a fixed sum and
expenses of attendance, if any, may be allowed for attendance at each
regular or special meeting of the Board PROVIDED, that nothing herein
contained shall be construed to preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor.
OFFICERS
24. The officers of the Corporation shall be chosen by the Board
of Directors and shall be a Chairman of the Board, a President, a
Vice-President, a Secretary and a Treasurer. The Board of Directors
may also choose additional Vice-Presidents, and one or more Assistant
Secretaries and Assistant Treasurers. Any number of offices may be
held by the same person. It shall not be necessary for the officers
to be directors.
25. The Board of Directors shall fix the salaries of all
officers of the Corporation.
26. The officers of the Corporation shall hold office for one
year and until their successors are chosen and have qualified. Any
officer elected or appointed by the Board of Directors may be removed
by the Board of Directors whenever in their judgment the best
interests of the Corporation will be served thereby.
LIABILITY OF OFFICERS
27. An officer, as such, shall not be personally liable to the
Corporation or its shareholders, for monetary damages, unless the
officer has breached or failed to perform the duties of his or her
office under the Corporation's articles of incorporation, these by-
laws or applicable provisions of law, and the breach or failure to
perform constitutes self-dealing, willful misconduct or recklessness.
The provisions of this Section shall not apply to the responsibility
or liability of an officer pursuant to any criminal statute or the
liability of an officer for the payment of taxes pursuant to local,
state or federal law.
CHAIRMAN OF THE BOARD
28. The Chairman of the Board shall preside at all meetings of
the stockholders and of the Board of Directors, and shall see that all
orders and resolutions of the Board of Directors are carried into
effect. He may sign certificates representing stock of the
Corporation the issuance of which shall have been authorized by the
Board of Directors. From time to time he shall report to the Board of
Directors all matters within his knowledge which the interests of the
Corporation may require to be brought to their notice. He shall
execute bonds, mortgages and other contracts requiring a seal, under
the seal of the Corporation, except where required or permitted by law
to be otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the Board of
Directors to some other officer or agent of the Corporation. He shall
be ex-officio a member of all committees of the Board of Directors.
He shall perform such other duties as are given to him by these by-
laws or as from time to time may be assigned to him by the Board of
Directors.
PRESIDENT
29. The President shall be the chief executive officer of the
Corporation, and subject to the direction of the Board of Directors,
shall have general supervision over the business and affairs of the
Corporation and over its officers and agents and general management
and control of all of its properties. In the absence of the Chairman
of the Board, he shall preside at all meetings of the stockholders or
of the Board of Directors at which he is present. He may sign
certificates of stock of the Corporation the issuance of which shall
have been authorized by the Board of Directors. He shall execute
bonds, mortgages and other contracts requiring a seal, under the seal
of the Corporation, except where required or permitted by law to be
otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the Board of
Directors to some other officer or agent of the Corporation. He shall
perform such other duties as are given to him by these by-laws or as
may from time to time be assigned to him by the Board of Directors.
VICE-PRESIDENT
30. In the absence of the President to perform the duties of
chief executive officer of the Corporation, or in the event of his
inability to act, the Vice-President (or in the event there be more
than one Vice-President, the Vice-Presidents in the order designated
by the directors, or in the absence of any designation, then in the
order of their election) shall have all the powers of and be subject
to all the restrictions upon the President. The Vice-Presidents,
under the supervision of the President, shall perform such other
duties and have such other powers as may be prescribed by the Board of
Directors or the President.
SECRETARY
31. The Secretary shall attend all sessions of the Board and all
meetings of the shareholders and act as clerk thereof, and record all
the votes of the Corporation and the minutes of all its transactions
in a book to be kept for that purpose; and shall perform like duties
for all committees of the Board of Directors when required. He shall
give, or cause to be given, notice of all meetings of the shareholders
and of the Board of Directors, and shall perform such other duties as
may be prescribed by the Board of Directors or President, and under
whose supervision he shall be. He shall keep in safe custody the
corporate seal of the Corporation, and when authorized by the Board,
affix the same to any instrument requiring it.
32. The Assistant Secretary, or if there be more than one, the
Assistant Secretaries in the order determined by the Board of
Directors (or if there be no such determination, then in the order of
their election) shall, in the absence of the Secretary or in the event
of his inability or refusal to act, perform the duties and exercise
the powers of the Secretary, under the supervision of the President,
and shall perform such other duties and have such other powers as may
be prescribed by the Board of Directors or President.
TREASURER
33. The Treasurer shall have custody of the corporate funds and
securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation, and shall keep
the moneys of the Corporation in a separate book account to the credit
of the Corporation.
34. He shall disburse the funds of the Corporation as may be
ordered by the Board, taking proper vouchers for such disbursements,
and shall render to the President and directors, at the regular
meetings of the Board, or whenever they may require it, an account of
all his transactions as Treasurer and of the financial condition of
the Corporation.
35. The Assistant Treasurer, or if there shall be more than one,
the Assistant Treasurer in the order determined by the Board of
Directors (or if there be no such determination, then in the order of
their election), shall, in the absence of the Treasurer or in the
event of his inability or refusal to act, perform the duties and
exercise the powers of the Treasurer, under the supervision of the
President, and shall perform such other duties and have such other
powers as may be prescribed by the Board of Directors or President.
VACANCIES
36. If the office of any officer or agent, one or more, becomes
vacant for any reason, the Board of Directors may choose a successor
or successors, who shall hold office for the unexpired term in respect
of which such vacancy occurred.
Vacancies in the Board of Directors shall be filled, by
persons who are Qualified Nominees as defined in Section 14 of those
By-Laws, by the vote of a majority of the remaining members of the
Board though less than a quorum, and each person so elected shall be a
director until his successor is elected by the shareholders, who may
make such election at the next annual meeting of the shareholders or
at any special meeting duly called for that purpose and held prior
thereto.
CORPORATE RECORDS
37. There shall be kept at the principal office of the
Corporation an original or duplicate record of the proceedings of the
shareholders and of the directors, and the original or a copy of its
by-laws, including all amendments or alterations thereto to date,
certified by the Secretary of the Corporation. An original or
duplicate share register shall also be kept at the principal office,
or at the office of a transfer agent or registrar within this
Commonwealth, giving the names of the shareholders in alphabetical
order, and showing their respective addresses and the number and
classes of shares held by each.
SHARE CERTIFICATES
38. The share certificates of the Corporation shall be numbered
and registered in the transfer books of the Corporation, as they are
issued. They shall be signed by either the Chairman of the Board or
the President and by the Secretary and shall bear the corporate seal.
Any or all signatures on the certificates may be a facsimile. In
case any officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with the
same effect as if he were such officer, transfer agent or registrar at
the date of issue.
TRANSFERS OF SHARES
39. Assuming no conflict with valid share transfer restrictions,
transfers of shares shall be made on the books of the Corporation upon
surrender of the certificates therefor, endorsed by the person named
in the certificate or by his attorney, lawfully constituted in
writing.
CLOSING TRANSFER BOOKS OR FIXING RECORD DATE
40. The Board of Directors may fix a time, not less than ten or
more than ninety days, prior to the date of any meeting of
shareholders, or the date fixed for the payment of any dividend or
distribution, or the date for the allotment of rights, or the date
when any change, conversion or exchange of shares will be made or go
into effect, as a record date for the determination of the
shareholders entitled to notice of, and to vote at, any such meeting,
or entitled to receive payment of any such dividend or distribution or
to receive any such allotment of rights, or to exercise the rights in
respect to any change, conversion or exchange of shares. In such
cases, only such shareholders as shall be shareholders of record on
the date so fixed shall be entitled to notice of, and to vote at, such
meeting, or to receive payment of such dividend or distribution, or to
receive such allotment of rights, or to exercise such rights, as the
case may be, notwithstanding any transfer of any shares on the books
of the Corporation after any record date fixed, as aforesaid. The
Board of Directors may close the books of the Corporation against
transfers of shares during the whole or any part of such period, and
in such case written or printed notice thereof shall be mailed at
least ten days before the closing thereof to each shareholder of
record at the address appearing on the records of the Corporation or
supplied by him to the Corporation for the purpose of notice. While
the stock transfer books of the Corporation are closed, no transfer of
shares shall be made thereon. If no record date is fixed for the
determination of shareholders entitled to receive notice of, or vote
at, a shareholders meeting, transferees of shares which are
transferred on the books of the Corporation within ten days next
preceding the date of such meeting shall not be entitled to notice of
or vote at such meeting.
LOST CERTIFICATE
41. Any person claiming a share certificate to be lost or
destroyed shall make an affidavit or affirmation of that fact and
advertise the same in such manner as the Corporation may require, and
shall, if required by the Corporation, give the Corporation a bond of
indemnity with sufficient surety to protect the Corporation or any
person injured by the issue of a new certificate from any liability or
expense which it or they may incur by reason of the original
certificate remaining outstanding, whereupon a new certificate may be
issued of the same tenor and for the same number of shares as the one
alleged to be lost or destroyed, but always subject to the approval of
the Corporation.
CHECKS
42. All checks or demands for money and notes of the Corporation
shall be signed by such officer or officers as the Board of Directors
may from time to time designate.
FISCAL YEAR
43. The fiscal year shall begin the 1st day of August of each
year.
DIVIDENDS
44. Subject to the provisions of the statutes, the Board of
Directors may declare and pay dividends upon the outstanding shares of
the Corporation out of its surplus from time to time and to such
extent as they deem advisable, in cash, property or in shares of the
Corporation.
Before payment of any dividend there may be set aside out of
the net profits of the Corporation such sum or sums as the directors,
from time to time, in their absolute discretion, think proper as a
reserve fund to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the Corporation, or for
such other purpose as the directors shall think conducive to the
interests of the Corporation, and the directors may abolish any such
reserve in the manner in which it was created.
DIRECTORS' ANNUAL STATEMENT
45. The Chairman of the Board and Board of Directors shall
present at each annual meeting a full and complete statement of the
business and affairs of the Corporation for the preceding year. Such
statement shall be prepared and presented in whatever manner the Board
of Directors shall deem advisable and need not be verified by a
certified public accountant.
NOTICES
46. Whenever written notice is required to be given to any
person, it may be given to such person, either personally or by
sending a copy thereof through the mail, or by telegram, charges
prepaid, to his address appearing on the books of the Corporation, or
supplied by him to the Corporation for the purpose of notice. If the
notice is sent by mail or by telegraph, it shall be deemed to have
been given to the person entitled thereto when deposited in the United
States mail or with a telegraph office for transmission to such
person. Such notice shall specify the place, day and hour of the
meeting and, in the case of a special meeting, the general nature of
the business to be transacted.
Any shareholder or director may waive any notice required to
be given under these by-laws.
INDEMNIFICATION
47.A. The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the
right of the Corporation), by reason of the fact that he is or was a
director or officer of the Corporation, or is or was serving at the
request of the Corporation as a director, officer or member of another
corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonably believed to be in, or not opposed
to, the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea
of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner
which he reasonably believed to be in, or not opposed to, the best
interests of the Corporation, and with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was
unlawful.
B. The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the Corporation to
procure a judgment in its favor by reason of the fact that he is or
was a director or officer of the Corporation, or is or was serving at
the request of the Corporation as a director, officer or member of
another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith in a
manner he reasonably believed to be in, or not opposed to, the best
interests of the Corporation; provided, however, that no
indemnification shall be made in respect of any claim, issue or matter
as to be which such person shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to the
Corporation unless and only to the extent that the court of common
pleas of the county in which the registered office of the Corporation
is located or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability
but in view of all circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which the court
of common pleas or such other court shall deem proper.
C. To the extent that a director or officer of the Corporation
has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in paragraphs A or B of this
Section 47 or in defense of any claim, issue or matter therein, he
shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection therewith.
D. Any indemnification under paragraphs A or B of this Section
47 (unless ordered by a court) shall be made by the Corporation only
as authorized in the specific case upon a determination that
indemnification of the director or officer is proper in the
circumstances because he had met the applicable standard of conduct
set forth in such paragraph. Such determination shall be made (1) by
the Board of Directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or proceeding; or
(2) if such quorum is not obtainable, or, even if obtainable, a
majority vote of a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion; or (3) by the
shareholders.
E. Expenses incurred in defending a civil or criminal action,
suit, or proceeding may be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding as authorized in
the manner provided in paragraph D of this Section 47 upon receipt of
an undertaking by or on behalf of the director or officer to repay
such amount unless it shall ultimately be determined that he is
entitled to be indemnified by the Corporation as authorized in this
Section 47.
F. The indemnification provided by this Section 47 shall not be
deemed exclusive of any other rights to which those seeking
indemnification may be entitled under any by-law, agreement, vote of
shareholders or disinterested directors or otherwise, both as to
action in his official capacity and as to action in another capacity
while holding such office, and shall continue as to a person who has
ceased to be a director or officer and shall inure to the benefit of
the heirs, executors and administrators of such a person.
48.A. The Corporation shall indemnify any person who was or is an
"authorized representative" of the Corporation (which shall mean for
purposes of this Section a director or officer of the Corporation, or
a person serving at the request of the Corporation as a director,
officer, partner, trustee or fiduciary of another corporation,
partnership, joint venture, trust, employee benefit plan or other
entity or enterprise) and who was or is a party (which shall mean for
purposes of this Section any threatened, pending or completed action,
suit, appeal or proceeding of any nature, whether civil, criminal,
administrative, or investigative, whether formal or informal,
including an action by or in the right of the Corporation or a class
of its security holders) by reason of the fact that he or she was or
is an authorized representative of the Corporation, against any
liability (which shall mean for purposes of this Section any damage,
judgment, penalty, fine, amount paid in settlement, punitive damages,
excise tax assessed with respect to an employee benefit plan, or cost
or expense of any nature including, without limitation, attorneys'
fees and disbursements) including, without limitation, liabilities
resulting from any actual or alleged breach or neglect of duty, error,
misstatement or misleading statement, negligence, gross negligence or
act giving rise to strict or products liability, except where such
indemnification is for acts or failures to act constituting self-
dealing, willful misconduct or recklessness. If an authorized
representative is entitled to indemnification in respect of a portion,
but not all, of any liabilities to which such person may be subject,
the Corporation shall indemnify such authorized representative to the
maximum extent for such portion of the liabilities. The termination
of any proceeding by judgment, order, settlement, indictment or
conviction or upon a plea of nolo contendere or its equivalent, shall
not, of itself, create a presumption that the authorized
representative is not entitled to indemnification.
B. Notwithstanding any other provision of this Section, the
Corporation shall not indemnify under this Section an authorized
representative for any liability incurred in a proceeding initiated
(which shall not be deemed to include counter-claims or affirmative
defenses) or participated in as an intervenor or amicus curiae by the
person seeking indemnification unless such initiation of or
participation in the proceeding is authorized, either before or after
its commencement, by the affirmative vote of a majority of the
directors in office. This paragraph does not apply to reimbursement
of expenses incurred in successfully prosecuting or defending the
rights of an authorized representative granted by or pursuant to this
Section.
C. Expenses (including attorneys' fees and disbursements)
incurred in good faith shall be paid by the Corporation on behalf of
an authorized representative in advance of the final disposition of a
proceeding described in paragraph A of this Section upon receipt of an
undertaking by or on behalf of the authorized representative to repay
such amount if it shall ultimately be determined pursuant to paragraph
F of this Section that such person is not entitled to be indemnified
by the Corporation as authorized in this Section. The financial
ability of such authorized representative to make such repayment shall
not be a prerequisite to the making of an advance.
D. To further effect, satisfy or secure the indemnification
obligations provided herein or otherwise, the Corporation may maintain
insurance, obtain a letter of credit, act as self-insurer, create a
reserve, trust, escrow, cash collateral or other fund or account,
enter into indemnification agreements, pledge or grant a security
interest in any assets or properties of the Corporation, or use any
other mechanism or arrangement whatsoever in such amounts, at such
costs, and upon such other terms and conditions as the Board of
Directors shall deem appropriate. Absent fraud, the determination of
the Board of Directors with respect to such amounts, costs, terms and
conditions shall be conclusive against all security holders, officers
and directors and shall not be subject to voidability.
E. An authorized representative shall be entitled to
indemnification within 30 days after a written request for
indemnification has been received by the Secretary of the Corporation.
F. Any dispute related to the right to indemnification or
advancement of expenses as provided under this Section, except with
respect to indemnification for liability arising under the Securities
Act of 1933 which the Corporation has undertaken to submit to a court
for adjudication, shall be decided only by arbitration, to be
conducted at the Corporation's executive offices (or such other
location to which the Corporation has given its consent), in
accordance with the commercial arbitration rules then in effect of the
American Arbitration Association, before a panel of three arbitrators,
one of whom shall be selected by the Corporation, the second of whom
shall be selected by the authorized representative and the third of
whom shall be selected by the other two arbitrators. In the absence
of the American Arbitration Association or if for any reason
arbitration under the arbitration rules of the American Arbitration
Association cannot be initiated, or if the arbitrators selected by the
Corporation and the authorized representative cannot agree on the
selection of the third arbitrator within 30 days after such time as
the Corporation and the authorized representative have each been
notified of the selection of the other's arbitrator, the necessary
arbitrator or arbitrators shall be selected by the presiding judge of
the Court of Common Pleas of Fulton County, Pennsylvania (or of the
court of general jurisdiction in the municipality in which the
Corporation's executive offices are located). Each arbitrator
selected as provided herein is required to be or have been a director
of a corporation whose shares of common stock were listed during at
least one year of such service on the New York Stock Exchange or the
American Stock Exchange or quoted on the National Association of
Securities Dealers Automated quotations Systems. The party or parties
challenging the right of an authorized representative to the benefits
of this Section shall have the burden of proof. The Corporation shall
reimburse an authorized representative for the expenses (including
attorneys' fees and disbursements) incurred in successfully
prosecuting or defending such arbitration. Any award entered by the
arbitrators shall be final, binding and nonappealable, and judgement
may be entered thereon by any party in accordance with applicable law
in any court of competent jurisdiction. This arbitration provision
shall be specifically enforceable.
G. An authorized representative shall be deemed to have
discharged such person's duty to the Corporation if he or she has
relied in good faith on information, advice or an opinion, report or
statement prepared by:
(1) one or more officers or employees of the Corporation
whom such authorized representative reasonably believes to be
reliable and competent with respect to the matter presented;
(2) legal counsel, public accountants or other persons as
to matters that the authorized representative reasonably believes
are within the person's professional or expert competence; or
(3) a committee of the Board of Directors on which he or
she does not serve as to matters within its area of designated
authority, which committee he or she reasonably believes to merit
confidence.
H. All rights to indemnification under this Section shall be
deemed a contract between the Corporation and the authorized
representative pursuant to which the Corporation and each authorized
representative intend to be legally bound. Any repeal, amendment or
modification hereof shall be prospective only and shall not affect any
rights or obligations then existing.
I. The indemnification and advancement of expenses provided by,
or granted pursuant to, this Section shall not be deemed exclusive of
any other rights to which a person seeking indemnification or
advancement of expenses may be entitled under any statute, certificate
or articles of incorporation, by-law, agreement, vote of shareholders
or directors or otherwise, both as to action in his or her official
capacity and as to action in any other capacity, and shall continue as
to a person who has ceased to be an authorized representative in
respect of matters arising prior to such time and shall inure to the
benefit of the heirs, executors, administrators and personal
representatives of such a person.
J. Each person who shall act as an authorized representative of
the Corporation shall be deemed to be doing so in reliance upon the
rights of indemnification provided by this Section.
AMENDMENTS
49. Except as otherwise provided by the Business Corporation
Law, these by-laws may be amended (i) at any regular or special
meeting of the Board of Directors by the affirmative vote of a
majority of the members of the Board, or (ii) at any annual or
special meeting of the shareholders by the affirmative vote of
shareholders entitled to cast at least a majority of the votes which
all shareholders are entitled to cast thereon, provided that in the
case of any such meeting of the shareholders, notice of the proposed
amendment shall have been contained in the notice of such meeting and
provided further that the shareholders shall always have the power to
change any such action by the Board.
EXHIBIT 15
Ernst & Young LLP
February 15, 1995
The Board of Directors
JLG Industries, Inc.
We are aware of the incorporation by reference in the registration statements
(Form S-8 No. 33-60366, Form S-8 No. 2-87955 and Form S-8 No. 33-75746) of JLG
Industries, Inc. of our report dated February 15, 1995, except for Note D, as
to which the date is February 23, 1995, relating to the unaudited condensed
consolidated interim financial statements of JLG Industries, Inc., which are
included in its Form 10-Q for the quarter ended January 31, 1995.
Pursuant to Rule 436(c) of the Securities Act of 1933 our report is not a part
of the registration statement prepared or certified by accountants within the
meaning of Section 7 or 11 of the Securities Act of 1933.
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