UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (Fee Required)
For the fiscal year ended July 2, 1994
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (No Fee Required)
For the transition period from ________ to ________
Commission File Number 1-11978
THE MANITOWOC COMPANY, INC.
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(Exact name of registrant as specified in its charter)
Wisconsin 39-0448110
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
700 E. Magnolia Avenue, Suite B, Manitowoc, Wisconsin 54220
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (414) 684-4410
Securities Registered Pursuant to Section 12(b) of the Act:
Common Stock, $.01 Par Value New York Stock Exchange
(Title of Each Class) (Name of Each Exchange on Which Registered)
Securities Registered Pursuant to Section 12(g) of the Act:
None
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 [ ]
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K. [ X ]
The Aggregate Market Value on September 2, 1994, of the
registrant's Common Stock held by non-affiliates of the registrant was
$199,246,189, based on the $26.50 per share average of high and low
sale prices on that date.
The number of shares outstanding of the registrant's Common Stock
as of September 2, 1994, the most recent practicable date, was
7,678,525.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of registrant's Annual Report to Shareholders for the
fiscal year ended July 2, 1994 (the "1994 Annual Report"), are
incorporated by reference into Parts I and II of this report.
Portions of the registrant's Proxy Statement for the Annual Meeting of
Shareholders dated September 30, 1994 (the "1994 Proxy Statement"),
are incorporated by reference in Part III of this report.
See page 21 for Index to Exhibits.
PART I
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Item 1. Business
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GENERAL
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The Manitowoc Company, Inc. (the "Company" or "Manitowoc"), a
Wisconsin corporation, is a diversified, capital goods manufacturer
headquartered in Manitowoc, Wisconsin. Founded in 1902, the Company
is principally engaged in: (a) the design and manufacture of cranes
and related products which are used by the energy, construction,
mining and other industries; (b) the design and manufacture of
commercial ice machines and refrigeration products for the
foodservice, lodging, convenience store and healthcare markets; and
(c) marine vessel repair. The Company currently operates two
manufacturing facilities in Manitowoc, Wisconsin; ship repair yards in
Sturgeon Bay, Wisconsin and Toledo and Cleveland, Ohio; an overhead-
crane factory in Big Bend, Wisconsin; a crane re-manufacturing
facility in Bauxite, Arkansas; a crane replacement parts manufacturing
facility in Punxsutawney, Pennsylvania and Pompano Beach, Florida; and
a boom truck and pedestal crane operation in Georgetown, Texas.
For information relating to the Company's lines of business and
industry segments, see Management's Discussion and Analysis of Results
of Operations and Financial Condition, the Eleven-Year Financial
Summary and Business Segment Information, Research and Development
Costs in the Summary of Significant Accounting Policies, and Note 11
to Consolidated Financial Statements on pages 9, 12, 18 and 22,
respectively, of the 1994 Annual Report, which are incorporated herein
by reference.
PRODUCTS AND SERVICES
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Cranes and Related Products
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The Company designs and manufactures a diversified line of
crawler, truck, fixed-base mounted, overhead and hydraulically-powered
cranes, which are sold under the "Manitowoc", "Manitex", "Orley
Meyer", and "West-Manitowoc, Inc." names for use by the
energy, construction, mining, pulp and paper, and other industries.
Many of the Company's customers purchase one crane together with
several options to permit use of the crane in various lifting
applications and other operations. Various crane models combined with
available options have lifting capacities ranging from approximately
10 to 1,500 U.S. tons and excavating capacities ranging from 3 to 15
cubic yards.
The Company has developed a line of hydraulically-driven,
electronically-controlled M-Series crawler cranes. M-Series cranes
are easier to transport, operate and maintain, as well as being more
productive in a number of applications. Six models, along with
various attachments, have been introduced to-date with lifting
capacities ranging from 65 to 1,500 U.S. tons.
The Company also performs machining, fabricating and assembly
subcontract work utilizing crane manufacturing facilities. The
Company also has a remanufacturing facility in Bauxite, Arkansas which
buys older cranes for remanufacture and rebuild and sells the finished units
through the distribution channels mentioned below. Customer owned
cranes are also remanufactured at this facility.
In fiscal 1994, the Company launched a completely new business
unit - West-Manitowoc. Its prime target will be the smaller,
independent contractors and rental-fleet customers who need smaller,
less complicated, easily transportable, and more versatile cranes that
will meet the needs of a broad range of users.
To serve this growing market, West-Manitowoc is developing a new
line of value-priced cranes with those characteristics. The first of
these, the 90-ton lifting capacity West-100 cranes, will be shipped in
the fourth calendar quarter of 1994.
As West-Manitowoc introduces additional models in the 50- to 130-
ton range, Manitowoc Engineering will phase out production of small M-
Series models and concentrate solely on high-end cranes for customers
with specialized needs.
In February 1994, the Company acquired the assets of Femco
Machine Co. Femco Machine Co. is a manufacturer of parts for cranes,
draglines, and other heavy equipment. Femco is located in
Punxsutawney, Pennsylvania and Pompano Beach, Florida.
Femco and Manitowoc Re-Manufacturing together will form the
nucleus of a soon-to-be-organized Aftermarket Group that will
coordinate our push into the market for rebuilt and remanufactured
cranes, both Manitowoc and non-Manitowoc units. Femco's existing
South Florida operation is ideally positioned to serve the large Latin
American market where used cranes are the order of the day.
During 1994, Manitowoc Engineering began development of a new
second generation crane - the Model-888 - which is slated for
introduction in the spring of 1995 with production following later in
the year. The Model-888 is a 200-ton class hydraulically powered
crawler crane that is intended to serve a very diverse lifting,
construction, and material handling market.
The Company's cranes and related products are sold throughout
North America and foreign countries by independent distributors, and
by Company- owned sales subsidiaries located in Long Island City, New
York; Mokena, Illinois; La Mirada, California; Benicia, California;
Seattle, Washington; Northampton, England and Chur, Switzerland. In
fiscal 1993, the Company sold two previously owned sales subsidiaries
located in Davie, Florida and Charlotte, North Carolina.
Distributors generally do not carry inventories of new cranes,
except for the smaller truck cranes. Most distributors maintain
service facilities and inventories of replacement parts. Company
employed service representatives usually assist customers in the
initial set-up of new cranes.
The Company does not generally provide financing for either its
independent distributors or their customers; however, dealers
frequently assist customers in arranging financing and may accept used
cranes as partial payment on the sale of new cranes.
In recent years, the Company has established a fleet of crawler
crane and boom truck cranes at the Company-owned sales
subsidiaries, which are leased on a short-term basis, primarily to the
construction industry. During fiscal 1992, the Company entered into a
sale/leaseback arrangement covering substantially all of the fleet.
See Note 10 to Consolidated Financial Statements on Page 22 of the
1994 Annual Report.
See Note 11 to Consolidated Financial Statements on page 22 of
the 1994 Annual Report with respect to export sales. Such sales are
usually made to the Company's foreign subsidiaries or independent
distributors, in addition to sales made to domestic customers for
foreign delivery. Foreign sales are made on Letter of Credit or
similar terms.
The year-end backlog of crane products includes orders which have
been placed on a production schedule, and those orders which the
Company has accepted and which are expected to be shipped and billed
during the next fiscal year. The backlog of unfilled orders for
cranes and related products at July 2, 1994 approximates $26.9
million, as compared to $57.7 million in fiscal 1993. The decrease is
due to the decline in crawler crane orders from outside the United
States.
Foodservice
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The Foodservice Products business segment designs, manufacturers,
and markets commercial ice cube machines, ice storage bins, ice cube
dispensers, and related accessories including water filtration
systems, reach-in refrigerators and freezers. Serving the needs of
foodservice, lodging, convenience store, and healthcare operations
worldwide, the Company has captured a leading percentage of the
commercial ice cube machine market.
Several models of automatic ice cube making and dispensing
machines are designed, manufactured and marketed by the Company.
Offering daily production capacities from 160 to 1,890 pounds,
Manitowoc ice machines are complemented by storage bins with
capacities from 220 to 760 pounds; countertop ice and beverage
dispensers with capacities to 160 pounds; floor-standing ice
dispensers with capacities to 180 pounds; and optional accessories
such as water filters and ice baggers. The reach-in refrigerators and
freezers are available in one, two or three-door models that provide
gross storage capacities of 23.1, 47.8 and 73.7 cubic feet,
respectively.
In fiscal 1993, the foodservice products group introduced a new
line of ice machines that use an environmentally enlightened
refrigerant. The new "B-Series" includes ten models which are
complemented by seven ice storage bins. For added customer
convenience, the "B" models also feature standard self-cleaning and
optional automatic-cleaning systems that improve reliability while
simplifying maintenance.
The Company also introduced the industry's first reach-in cooler
that uses an environmentally enlightened refrigerant. In addition,
our foodservice group received a U.S. patent covering the drop-in
refrigeration units for its reach-in cabinets.
The Company is completing arrangements with a joint-venture
partner to begin production of ice machines in China. The joint-
venture factory will assemble the Company's new model I-25 ice
machine. the I-25 produces 30 pounds of ice per day. It was
developed to meet the needs of customers in overseas markets that do
not require the 160 to 1,890 pound daily outputs of the standard ice
making models.
The Foodservice Products business segment sales are made from the
Company's inventory and sold worldwide through independent wholesale
distributors, chain accounts, and government agencies. The
international markets consist of Western Europe, the Far East, the
Middle East, the Near East, Latin America, the Carribbean and Africa.
Since sales are made from the Company's inventory, orders are
generally filled within 24 to 48 hours. The backlog for unfilled
orders for Foodservice Products at July 2, 1994 is not significant.
Marine
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The Company had been a shipbuilder since its inception in 1902.
For almost seven decades, all shipbuilding operations were conducted
in Manitowoc, Wisconsin. Two adjoining shipyards in Sturgeon Bay,
Wisconsin, were acquired in 1968 and 1970, and all shipbuilding
activities were transferred to those facilities.
In March, 1988, the Company announced that, due to the continued
decline in the U.S. shipbuilding industry, it would no longer pursue
new ship construction contracts and would restructure its shipbuilding
subsidiary to be more competitive on ship conversions and repair work.
In January, 1992, the Company acquired substantially all the
assets of Merce Industries, Inc. Merce Industries, Inc. operated the
ship repair facility owned by the Port Authority of Toledo, Ohio, and
similar operations in Cleveland, Ohio. Included with the acquisition
was the assumption of a lease agreement with the Port Authority for
the ship repair facilities. See Note 7 to Consolidated Financial
Statements on Page 21 of the 1994 Annual Report.
The year-end backlog for the marine segment includes repair and
maintenance work presently scheduled at the shipyard which will be
completed in the next fiscal year. At July 2, 1994 the backlog
approximates $2.5 million, compared to $2.4 million one year ago.
Raw Materials and Supplies
- - --------------------------
The primary raw material used by the Company is structural and
rolled steel, which is purchased principally from various domestic
sources. The Company also purchases engines and electrical equipment
and other semi-and- fully processed materials. It is the policy of
the Company to maintain, wherever possible, alternate sources of
supply for its important materials and parts. The Company maintains
inventories of steel and other purchased material.
Patents, Trademarks, Licenses
- - -----------------------------
The Company owns a number of United States and foreign patents
pertaining to the crane and foodservice products, and has presently
pending applications for patents in the United States and foreign
countries. In addition, the Company has various registered and
unregistered trademarks and licenses which are of material importance
to the Company's business.
Seasonality
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Typically, the second calendar quarter represents the Company's
best quarter in all of the business segments. In the cranes and
related products segment, summer represents the main construction
season. Customers require new machines, parts, and service prior to
such season. Since the summer also brings along warmer weather, there
is an increase in the use of ice machines. As a result, distributors
are building inventories for the increased demand. With respect to
the Marine segment, the Great Lakes shipping industry's sailing season
is normally May through November. Thus, barring any emergency
groundings, the majority of repair and maintenance work is performed
during the winter months. Accordingly, the work is typically
completed during the second calendar quarter of the year.
Competition
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All of the Company's products are sold in highly competitive
markets. Competition is at all levels, including price, service and
product performance.
With respect to crawler cranes, there are numerous domestic and
foreign manufacturers of cranes with whom the Company competes,
including American Crane Corporation, Wilmington, North Carolina; Link
Belt Construction Equipment Co., a subsidiary of Sumitomo Corporation,
Tokyo, Japan; Kobelco, Kobe Steel, Ltd., Tokyo, Japan; Mannesmann
Demag Baumaschinen, Zweibrucken, West Germany; Liebherr-Werk Ehingen
GMBH, Ehingen, West Germany; Hitachi Construction Machinery Co., Ltd.,
Tokyo, Japan; and Krupp Industrietechnik, Wilhelmshaven, Germany.
Within the market the Company serves, lattice boom crawler cranes
with lifting capacities greater than 125 tons, Manitowoc is a world
leader of this equipment.
The competitors within the boom truck crane market include
Simon-R.O. Corp., Olathe, Kansas; National Crane, Waverly, Nebraska;
and JLG, McConnellsburg, Pennsylvania. The Company believes that its
current output of boom truck cranes ranks third among its competitors.
Within the ice machine division, there are several manufacturers
with whom the Company competes. The primary competitors include
Scotsman Industries (tradename Scotsman and Crystal Tips), Prospect
Heights, Illinois; Welbilt Company (tradename Ice-O-Matic), New Hyde
Park, New York; and Hoshizaki American, Inc. (tradename Hoshizaki),
Peachtree City, Georgia. As noted earlier, the Company is the
leading, low-cost, producer of ice machines.
The list of competitors in the reach-in refrigeration and
freezers product line include Beverage Air, Spartanburg, South
Carolina; The Delfield Company, Mt. Pleasant, Michigan; Traulsen &
Company, Inc., College Point, New York; and True Food Service Company,
O'Fallon, Missouri. Since Manitowoc is relatively new to this market,
its market share is less than the aforementioned competitors. The
Company believes that its market share in the reach-in refrigerator
and freezer product line will continue to grow.
In the ship repair operation, the Company is one of two
operational shipyards on the Great Lakes capable of drydocking and
servicing 1000 foot Great Lakes bulk carriers; the other is Erie
Marine Enterprises, Erie, Pennsylvania. There is one other shipyard
on the Great Lakes, Fraser Shipyards, Inc., Superior, Wisconsin, with
whom the Company competes for drydocking and servicing smaller Great
Lakes vessels. In addition, with the passage of NAFTA, Canadian
facilities may compete with the company in the future. The Company
also competes with many smaller firms which perform top side repair
work during the winter lay-up period. In addition, there are
shipyards on the East, West and Gulf Coasts capable of converting and
reconstructing vessels of sizes that can enter the Great Lakes through
the St. Lawrence Seaway and the Wellen Canal. There are also
shipyards on the inland rivers capable of servicing smaller,
specialized vessels which the Company is capable of servicing.
Employee Relations
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The Company employs approximately 1,900 persons, of whom about
300 are salaried. Company-wide employment is fairly comparable to the
prior year.
The Company has labor agreements with 19 union locals. There
have been no work stoppages during the three years ended July 2, 1994.
Item 2. PROPERTIES
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Owned
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Cranes and related products are manufactured at plant locations
in Manitowoc, Wisconsin; Georgetown, Texas; Bauxite, Arkansas; and
Punxsutawney, Pennsylvania. In connection with a 1986 restructuring
program, most crane operations in Manitowoc were consolidated at the
original plant. This facility comprises approximately 600,000 square
feet of manufacturing and office space located on approximately 50
acres of land in the central city. Included is a 110,000 square foot
structure, completed in 1983, which replaced a portion of the
Company's main fabrication shop. In 1984 work was completed on the
expansion of the main boiler house, which provides steam for the
majority of shops, warehouses and office facilities in the central
city location. Certain manufacturing operations were moved back to
the South Works facility from this central city facility during fiscal
1991. South Works' construction was completed in 1978 providing the
Company with approximately 265,000 square feet of manufacturing and
storage space which is now fully utilized.
Included with the asset purchase of Femco Machine Co. are three
manufacturing and office facilities in Punxsutawney and a similar
facility in nearby Hawthorn, Pennsylvania. The Punxsutawney
facilities have approximately 71,000 square feet and are located on
approximately 34 acres. The Hawthorn facility, with 36,000 square
feet and located on approximately 3 acres, is currently held for sale.
In the fourth quarter of fiscal 1993, the boomtruck crane
operations were moved to Georgetown, Texas. The Company purchased an
existing manufacturing and office facility totaling approximately
175,000 square feet. Previously, this operation consisted of
manufacturing and office facilities located in McAllen, Texas, and a
fabrication plant located in Reynosa, Mexico.
In June, 1987, the Company purchased an existing 20,000 square
foot facility in Bauxite, Arkansas, for the remanufacturing of used
cranes. This facility began operations in fiscal 1988.
The Company's foodservice products are manufactured in modern,
fully-equipped facilities in Manitowoc, Wisconsin. Production of ice
machines and dispensers are housed in a 240,000-square foot facility;
while reach-in production is located in a nearby building that
includes more than 146,000 square feet of production and warehouse
space. In the fourth quarter of fiscal 1994, the Company began
construction on a 128,000 square feet addition for the ice machine
facility. This will allow both ice machines and reach-ins to be
manufactured in the same facility.
The Company's shipyard in Sturgeon Bay, Wisconsin, consists of
approximately 55 acres of waterfront property. Four of those acres,
which connect two operating areas of the shipyard, are leased under a
long term ground lease. There are approximately 295,000 square feet
of enclosed manufacturing and office space. Facilities at the
shipyard include a 140 by 1,158 foot graving dock, the largest on the
Great Lakes. In addition, there is a 250 foot graving dock, and a 600
foot floating drydock.
Additional properties consist primarily of crane sales offices
and warehouse facilities located in Long Island City, New York;
Seattle, Washington; and Northampton, England.
Leased
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The Company leases sales offices and warehouse facilities for
cranes and related products in Big Bend, Wisconsin; Mokena, Illinois;
and La Mirada and Benicia, California. In addition, the Company
leases facilities in Pompano Beach, Florida for parts manufacturing
and crane re-manufacturing. The Company also leases the shipyard
facilities at Toledo and Cleveland, Ohio for the Marine segment.
These facilities include waterfront land, buildings, and 800-foot and
550-foot graving docks. Furthermore the Company leases approximately
10,000 square feet of office space for the Corporate offices.
Item 3. LEGAL PROCEEDINGS
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The information required by this item is incorporated by
reference from Note 12 to Consolidated Financial Statements on Page
22 of the 1994 Annual Report.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- - -------------------------------------------------------------
No matters were submitted to security holders for a vote during
the fourth quarter of the Company's fiscal year ended July 2, 1994.
Executive Officers of the Registrant
- - ------------------------------------
Each of the following officers of the Company has been elected to a
renewable one-year term by the Board of Directors. The informaton
presented is as of September 26, 1994.
<TABLE>
<CAPTION>
Position With Principal Position
Name Age The Registrant Held Since
- - -------------- ---- -------------------- ------------------
<S> <C> <C> <C>
Fred M. Butler 59 President & CEO 1990
Robert K. Silva 66 Executive Vice President & COO 1994
Robert R. Friedl 40 Vice President & CFO 1992
Philip D. Keener 43 Treasurer 1990
E. Dean Flynn 53 Secretary 1993
</TABLE>
Fred M. Butler was elected President & Chief Executive Officer on July
17, 1990 and previously, served as Senior Vice President and Chief
Operating Officer from March 31, 1989. He joined the Company as
Manager of Administration in September, 1988. Prior to such date, Mr.
Butler was employed by Tyger Construction Co., Inc., a subsidiary of
Guy F. Atkinson Company, as President and Senior Vice President.
Robert K. Silva was elected Executive Vice President and Chief
Operating Officer of the corporation on July 8, 1994, and previously
served as Vice President from May 4, 1992, and as President and
General Manager of the Manitowoc Equipment Works, a division of The
Manitowoc Company, Inc. He joined the Company in 1979 as National
Sales Manager and held various positions with MEW. Prior to joining
the Company, he was Vice President at Follett Corporation.
Robert R. Friedl was elected Vice President and Chief Financial
Officer on May 4, 1992, and previously served as Vice President-
Finance from August 14, 1990. He joined the Company as Assistant
Treasurer on April 18, 1988. Prior to joining Manitowoc, he served
as Chief Financial Officer with Coradian Corp.; was co-founder, Vice
President of Finance and Treasurer of Telecom North, Inc.; and Tax
Manager for Nankin, Schnoll & Co., S.C.
Philip D. Keener was elected Treasurer on November 13, 1990. He
joined the Cmopany on October 1, 1990. Prior to that, Mr. Keener was
employed by Farley Industries, Inc. as Assistant Treasurer.
E. Dean Flynn was elected Secretary on February 2, 1993 and previously
served as Assistant Corporate Secretary from November 2, 1987; as
Manager of Corporate Insurance from January, 1990; and as Legal
Assistant from January 16, 1985. Prior to that, he served the Wabco
division of Dresser Industries, Inc. in numerous managerial positions
for 23 years, departing as manager of legal affairs in 1985.
PART II
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Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
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The information required by this item is incorporated by reference
from "Quarterly Common Stock Price Range", "Other Shareholder
Information", and "Supplemental Quarterly Financial Information
(Unaudited)" on pages 1 and 25 of the 1994 Annual Report.
Item 6. SELECTED FINANCIAL DATA
-----------------------
The information required by this item is incorporated by reference
from "Eleven-Year Record" on pages 12 and 13 of the 1994 Annual
Report.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
------------------------------------------------------------
The information required by this item is incorporated by reference
from "Management's Discussion and Analysis of Results of Operations
and Financial Conditions" on pages 9 through 11 of the 1994 Annual
Report.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
-------------------------------------------
The financial statements required by this item are incorporated by
reference from pages 14 through 23 of the 1994 Annual Report.
Supplementary financial information is incorporated by reference from
"Supplemental Quarterly Financial Information (Unaudited)" on page 25
of the 1994 Annual Report.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
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None.
PART III
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Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
--------------------------------------------------
The information required by this item is incorporated by reference
from the "Beneficial Ownership of Securities" section on page 3 of the
1994 Proxy Statement and from the "Election of Directors" section on
pages 4 and 5 of the 1994 Proxy Statement. See also "Executive
Officers of the Registrant" in Part I hereof.
Item 11. EXECUTIVE COMPENSATION
----------------------
The information required by this item is incorporated by reference
from the "Compensation of Directors", "Executive Compensation",
"Report of the Compensation and Benefits Committee on Executive
Compensation", "Performance Graph", "Contingent Employment
Agreements", and "F. M. Butler Supplemental Retirement Agreement"
sections on pages 6 through 12 of the 1994 Proxy Statement.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
------------------------------------------------------------
The information required by this item is incorporated by reference
from the "Beneficial Ownership of Securities" section on pages 2 and 3
of the 1994 Proxy Statement.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
----------------------------------------------
None.
PART IV
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Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K
- - ----------------------------------------------------------------------
(a) Documents filed as part of this Report.
(1) Financial Statements:
The following Consolidated Financial Statements are filed as
part of this report under Item 8, "Financial Statements and
Supplementary Data".
Report of Independent Public Accountants
Consolidated Statements Of Earnings for the years ended July
2, 1994, July 3, 1993, and June 27, 1992.
Consolidated Balance Sheets at July 2, 1994, and July 3,
1993.
Consolidated Statements of Cash Flows for the years ended
July 2, 1994, July 3, 1993 and June 27, 1992.
Consolidated Statements of Stockholders' Equity for the years
ended July 2, 1994, July 3, 1993, and June 27, 1992.
Summary of Significant Accounting Policies.
Notes to Consolidated Financial Statements.
(2) Financial Statement Schedules:
Financial Statement Schedules for the years ended July 2,
1994, July 3, 1993 and June 27, 1992:
Schedule Description Page
-------- ----------- ----
Report of Independent Public Accountants 14
I Marketable Securities - Other Investments 15
V Cost of Property, Plant and Equipment 16
VI Accumulated Depreciation of Property,
Plant and Equipment 17
VIII Valuation and Qualifying Accounts 18
X Supplementary Income Statements Information 19
All other financial statement schedules not listed have been
omitted since the required information is included in the
consolidated financial statements or the notes thereto, or is not
applicable or required under rules of Regulation S-X.
(b) Reports on Form 8-K:
While no reports on Form 8-K were filed during the fourth quarter
of fiscal 1994, a report on Form 8-K dated August 9, 1994 was filed to
report the Registrant's change in fiscal year-end from the Saturday
closest to June 30 of each calendar year to December 31 of each
calendar year.
(c) Exhibits:
See Index to Exhibits immediately following the signature page of
this report, which is incorporated herein by reference.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON SUPPLEMENTARY SCHEDULES
We have audited in accordance with generally accepted auditing
standards, the financial statements included in The Manitowoc Company,
Inc.'s annual report to shareholders incorporated by reference in this
Form 10-K, and have issued our report thereon dated July 28, 1994.
Our audit was made for the purpose of forming an opinion on those
statements taken as a whole. The schedules listed in Item 14(a)(2)
are the responsibility of the Company's management and are presented
for purposes of complying with the Securities and Exchange
Commission's rules and are not part of the basic financial statements.
These schedules have been subjected to the auditing procedures applied
in the audit of the basic financial statements and, in our opinion,
fairly state in all material respects the financial data required to
be set forth therein in relation to the basic financial statements
taken as a whole.
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin
July 28, 1994.
<TABLE>
<CAPTION>
THE MANITOWOC COMPANY, INC.
AND SUBSIDIARIES
SCHEDULE I: MARKETABLE SECURITIES - OTHER INVESTMENTS
FOR THE YEAR ENDED JULY 2, 1994
PRINCIPAL MARKET CARRYING
NAME AMOUNT COST VALUE VALUE
---- ------ --------- ------ --------
<S> <C> <C> <C> <C>
U.S. Treasury Notes $ 10,000,000 $ 10,012,721 $ 9,794,375 $ 10,012,721
Preferred Stock Fund 4,765,966 4,994,876 4,763,243 4,994,876
----------- ----------- ----------- -----------
$ 14,765,966 $ 15,007,597 $ 14,557,618 $ 15,007,597
----------- ----------- ----------- -----------
</TABLE>
<TABLE>
<CAPTION>
THE MANITOWOC COMPANY, INC.
AND SUBSIDIARIES
SCHEDULE V: COST OF PROPERTY, PLANT AND EQUIPMENT
FOR THE YEARS ENDED JUNE 27, 1992, JULY 3, 1993, AND JULY 2, 1994
BALANCE AT BALANCE AT
BEGINNING ADDITIONS OTHER END OF
CLASSIFICATION OF PERIOD AT COST RETIREMENTS CHANGES (1) PERIOD
-------------- --------- -------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C>
YEAR ENDED JUNE 27, 1992:
Land ......................... $ 3,485,769 $ 0 $ (21,142) $ 33,715 $ 3,498,342
Buildings .................... 61,545,543 755,402 (577,026) 378,181 62,102,100
Drydocks and dock fronts ..... 21,984,446 79,328 (23,653) 0 22,040,121
Machinery and equipment ...... 70,294,712 7,403,865 (6,615,319) 124,443 71,207,701
Construction in progress ..... 2,448,049 (1,666,193) 0 0 781,856
------------ ----------- ----------- ----------- ------------
Total $159,758,519 $ 6,572,402 $(7,237,140) $ 536,339 $159,630,120
------------ ----------- ----------- ----------- ------------
YEAR ENDED JULY 3, 1993:
Land ......................... $ 3,498,342 $ 0 $ 0 $ (74,437) $ 3,423,905
Buildings .................... 62,102,100 3,137,414 (287,011) (843,286) 64,109,217
Drydocks and dock fronts ..... 22,040,121 0 0 0 22,040,121
Machinery and equipment ...... 71,207,701 5,309,927 (1,241,924) (301,664) 74,974,040
Construction in progress ..... 781,856 2,765,744 0 0 3,547,600
------------ ----------- ----------- ----------- ------------
Total $159,630,120 $11,213,085 $(1,528,935) $(1,219,387) $168,094,883
------------ ----------- ----------- ----------- ------------
YEAR ENDED JULY 2, 1994:
Land ......................... $ 3,423,905 $ 382,539 $ 0 $ 5,646 $ 3,812,090
Buildings .................... 64,109,217 129,140 (1,505,110) 63,968 62,797,215
Drydocks and dock fronts ..... 22,040,121 0 0 0 22,040,121
Machinery and equipment ...... 74,974,040 13,357,886 (1,538,571) 23,009 86,816,364
Construction in progress ..... 3,547,600 (2,357) 0 0 3,545,243
------------ ----------- ----------- ----------- ------------
Total $168,094,883 $13,867,208 $(3,043,681) $ 92,623 $179,011,033
------------ ----------- ----------- ----------- ------------
<FN>
NOTES:(1) Effect of changes in currency exchange rates.
Depreciation provided for financial reporting purposes is based on the following estimated lives; buildings,
40 to 50 years; dry docks and dock fronts, 10 to 25 years; and machinery and equipment 5 to 20 years.
</TABLE>
<TABLE>
<CAPTION>
THE MANITOWOC COMPANY, INC.
AND SUBSIDIARIES
SCHEDULE VI: ACCUMULATED DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT
FOR THE YEARS ENDED AND JUNE 27, 1992, JULY 3, 1993 AND JULY 2, 1994
BALANCE AT BALANCE AT
BEGINNING ADDITIONS OTHER END OF
OF PERIOD AT COST RETIREMENTS CHANGES (1) PERIOD
---------- --------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
YEAR ENDED JUNE 27, 1992:
Buildings .................. $ 32,763,868 $ 2,198,759 $ (451,239) $ 46,997 $ 34,558,385
Drydocks and dock fronts ... 20,281,763 155,005 (23,653) 0 20,413,115
Machinery and equipment .... 53,038,015 3,769,816 (5,701,757) 49,027 51,155,101
------------ ------------ ------------ ----------- ------------
Total ...................... $106,083,646 $ 6,123,580 $ (6,176,649) $ 96,024 $106,126,601
------------ ------------ ------------ ----------- ------------
YEAR ENDED JULY 3, 1993:
Buildings .................. $ 34,558,385 $ 1,619,339 $ (86,623) $ (124,379) $ 35,966,722
Drydocks and dock fronts ... 20,413,115 153,034 0 0 20,566,149
Machinery and equipment .... 51,155,101 4,089,174 (526,952) (135,445) 54,581,878
------------ ------------ ------------ ----------- ------------
Total ...................... $106,126,601 $ 5,861,547 $ (613,575) $ (259,824) $111,114,749
------------ ------------ ------------ ----------- ------------
YEAR ENDED JULY 2, 1994:
Buildings .................. $ 35,966,722 $ 1,678,341 $ (366,043) $ 11,021 $ 37,290,041
Drydocks and dock fronts ... 20,566,149 148,490 0 0 20,714,639
Machinery and equipment .... 54,581,878 4,440,552 (1,360,585) 12,221 57,674,066
------------ ------------ ------------ ----------- ------------
Total ...................... $111,114,749 $ 6,267,383 $ (1,726,628) $ 23,242 $115,678,746
------------ ------------ ------------ ----------- ------------
<FN>
NOTE: (1) Transfers to other classifications and effect of changes in currency exchange rates.
</TABLE>
<TABLE>
<CAPTION>
THE MANITOWOC COMPANY, INC.
AND SUBSIDIARIES
SCHEDULE VIII: VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED JUNE 27, 1992 JULY 3, 1993, AND JULY 2, 1994
BALANCE AT CHARGED TO BALANCE AT
BEGINNING COSTS AND END OF
DESCRIPTION OF PERIOD EXPENSES DEDUCTIONS PERIOD
------------ ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
YEAR ENDED JUNE 27, 1992:
Allowance for doubtful accounts $ 642,829 $ 142,449 $ (401,684) $ 383,594
YEAR ENDED JULY 3, 1993:
Allowance for doubtful accounts $ 383,594 $ 453,993 $ (30,385) $ 807,202
YEAR ENDED JULY 2, 1994:
Allowance for doubtful accounts $ 807,202 $ 702,079 $ (732,536) $ 776,745
</TABLE>
<TABLE>
<CAPTION>
THE MANITOWOC COMPANY, INC.
AND SUBSIDIARIES
SCHEDULE X: SUPPLEMENTARY INCOME STATEMENTS INFORMATION
FOR THE YEARS ENDED JUNE 27, 1992, AND JULY 3, 1993 AND JULY 2, 1994
CHARGED TO COSTS
ITEM AND EXPENSES
----------------------- --------------------------
<S> <C>
Maintenance and Repairs
1992 $4,666,259
1993 $4,206,887
1994 $4,168,473
Advertising Costs
1992 $2,812,888
1993 $3,459,618
1994 $3,298,752
</TABLE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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:
THE MANITOWOC COMPANY, INC.
By: /s/ Fred M. Butler
------------------------------
Fred M. Butler
President & Chief Executive Officer
By: /s/ Robert R. Friedl
------------------------------
Robert R. Friedl
Chief Financial Officer
Dated: September 26, 1994
Pursuant to the requirements of the Securities Exchange Act of
1934, this Report has been signed below by the following persons
constituting a majority of the Board of Directors on behalf of the
registrant and in the capacities and on the dates indicated:
/s/ Fred M. Butler September 26, 1994
- - -----------------------------------------------
Fred M. Butler, President & CEO, Director
/s/ Robert K. Silva September 26, 1994
- - -----------------------------------------------
Robert K. Silva, Executive Vice President
& COO, Director
/s/ Gilbert F. Rankin, Jr. September 26, 1994
- - -----------------------------------------------
Gilbert F. Rankin, Jr., Director
/s/ George T. McCoy September 26, 1994
- - -----------------------------------------------
George T. McCoy, Director
/s/ Guido R. Rahr, Jr. September 26, 1994
- - -----------------------------------------------
Guido R. Rahr, Jr., Director
<TABLE>
<CAPTION>
THE MANITOWOC COMPANY, INC.
ANNUAL REPORT ON FORM 10-K
FOR THE FISCAL YEAR ENDED JULY 2, 1994
INDEX TO EXHIBITS
Filed
Herewith
Exhibit On
No. Description Page
- - ------- ----------- ----
<S> <C> <C>
3.1 Amended and Restated Articles of Incorporation as amended on November 5, 1984, filed as
Exhibit 3(a) to the Company's Annual Report on Form 10-K for the fiscal year ended June
29, 1985 and incorporated herein by reference.
3.2 Restated By-Laws (as amended through September 16, 1994) including amendment to Article X
adding Section 3 (Implied Amendments). 23
4.1(a) Rights Agreement dated September 5, 1986 between the Registrant and Morgan Shareholder
Services Trust Company, filed as Exhibit 4 to the Company's Annual Report on Form 10-K for
the fiscal year ended June 28, 1986 and incorporated herein by reference.
4.1(b) First amendment to Rights Agreement dated August 12, 1988, filed as Exhibit 1 to the
Company's report on Form 8-K dated August 26, 1988 and incorporated herein by reference.
4.2 Articles III, V, and VIII of the Amended and Restated Articles of Incorporation (see
Exhibit 3.1 above).
10.1(a) * The Manitowoc Company, Inc. Deferred Compensation Plan effective August 20, 1993, (the
"Deferred Compensation Plan") filed as Exhibit 4.1 to the Registrant's Registration
Statement on Form S-8 filed June 23, 1993, and incorporated herein by reference.
10.1(b) * Amendment to Deferred Compensation Plan adopted by the Board of Directors on April 26,
1994. 39
10.2 * The Manitowoc Company, Inc. Management Incentive Compensation Plan, effective July 4,
1993, filed as Exhibit 10(b) to the Company's Annual Report on Form 10-K for the fiscal
year ended July 3, 1993 and incorporated herein by reference.
10.3 * Form of Contingent Employment Agreement between the Company and Messrs. Butler, Flynn,
Friedl, Keener, Silva and certain other employees of the Company, filed as Exhibit 10(c)
to the Company's Annual Report on Form 10-K for the fiscal year ended July 1, 1989 and
incorporated herein by reference.
10.4 * Form of Indemnity Agreement between the Company and each of the directors, executive
officers and certain other employees of the Company, filed as Exhibit 10(d) to the
Company's Annual Report on Form 10-K for the fiscal year ended July 1, 1989 and
incorporated herein by reference.
10.5 * Supplemental Retirement Agreement between Fred M. Butler and the Company dated March 15,
1993 filed as Exhibit 10(e) to the Company's Annual Report on Form 10-K for the fiscal
year ended July 3, 1993 and incorporated herein by reference.
13 Portions of the 1994 Annual Report to Shareholders of The Manitowoc Company, Inc.
incorporated by reference into this Report on Form 10-K. 40
21 Subsidiaries of The Manitowoc Company, Inc. 63
23 Consent of Independent Public Accountants. 64
27 Financial Data Schedule. 65
<FN>
* Management contracts and executive compensation plans and
arrangements required to be filed as exhibits pursuant to Item 14(c)
of Form 10-K.
</TABLE>
EXHIBIT 3.2
1994 10-K
RESTATED BY-LAWS
OF
THE MANITOWOC COMPANY, INC.
(Adopted June 16, 1971)
1/(Amended August 14, 1972)
2/(Amended November 7, 1972)
3/(Amended March 19, 1973)
4/(Amended May 5, 1975)
5/(Amended August 17, 1981)
6/(Amended August 20, 1984)
7/(Amended September 5, 1986)
8/(Amended November 3, 1986)
9/(Amended August 21, 1987)
10/(Amended February 19, 1988)
11/(Amended August 12, 1988)
12/(Amended November 7, 1988)
13/(Amended June 23, 1989)
14/(Amended June 22, 1990)
15/(Amended August 9, 1990)
16/(Amended February 15, 1991)
17/(Amended August 12, 1992)
18/(Amended November 3, 1992)
19/(Amended February 1, 1994)
20/(Amended August 9, 1994)
21/(Amended September 16, 1994)
ARTICLE I.
OFFICES
19/ Section 1. Principal Office. The principal office of the
Corporation in the State of Wisconsin shall be located at 700 East
Magnolia Avenue, Suite B, in the City of Manitowoc, County of
Manitowoc. The Corporation may have such other offices, either within
or without the State of Wisconsin, as the Board of Directors may
designate or as the business of the Corporation may require from time
to time.
Section 2. Registered Office. The registered office of the
Corporation required by the Wisconsin Business Corporation Law to be
maintained in the State of Wisconsin may be, but not need be,
identical with the principal office in the State of Wisconsin, and the
address of the registered office may be changed from time to time by
the Board of Directors.
ARTICLE II.
SHAREHOLDERS
1/11/12/14/16/
Section 1. Annual Meeting. The annual meeting of shareholders
shall be held on the first Tuesday in November in each year for the
purpose of electing Directors and for the transaction of only such
other business as is properly brought before the meeting in accordance
with these By-Laws.
To be properly brought before the meeting, business must be
either (a) specified in the notice of meeting (or any supplement
thereto) given by or at the direction of the Board of Directors, (b)
otherwise properly brought before the meeting by or at the direction
of the Board of Directors, or (c) otherwise properly brought before
the meeting by a shareholder. In addition to any other applicable
requirements, for business to be properly brought before an annual
meeting by a shareholder, the shareholder must have given timely
notice thereof in writing to the Secretary of the Corporation. To be
timely, a shareholder's notice must be delivered to or mailed and
received at the principal executive offices of the Corporation, not
less than fifty (50) days nor more than seventy-five (75) days prior
to the meeting date set in this Section 1; provided, however, that in
the event that the meeting is not held within ten (10) business days
of the date set in this Section 1 and less than sixty-five (65) days'
notice or prior public disclosure of the date of the meeting is given
or made to shareholders, notice by the shareholder to be timely must
be so received not later than the close of business on the fifteenth
(15th) day following the day on which such notice of the date of the
annual meeting was mailed or such public disclosure was made,
whichever first occurs. A shareholder's notice to the Secretary shall
set forth as to each matter the shareholder proposes to bring before
the annual meeting (i) a brief description of the business desired to
be brought before the annual meeting and the reasons for conducting
such business at the annual meeting, (ii) the name and record address
of the shareholder proposing such business, (iii) the class and number
of shares of the Corporation which are beneficially owned by the
shareholder, and (iv) any material interest of the shareholder in such
business.
Notwithstanding anything in the By-Laws to the contrary, no
business shall be conducted at the annual meeting except in accordance
with the procedures set forth in this Section 1; provided, however,
that nothing in this Section 1 shall be deemed to preclude discussion
by any shareholder of any business properly brought before the annual
meeting.
The Chairman of an annual meeting shall, if the facts warrant,
determine and declare to the meeting that business was not properly
brought before the meeting in accordance with the provisions of this
Section 1, and if he should so determine, he shall so declare to the
meeting and any such business not properly brought before the meeting
shall not be transacted.
If the day fixed for the annual meeting shall be a legal holiday
in the State of Wisconsin, such meeting shall be held on the next
succeeding business day. If the election of Directors shall not be
held on the day designated herein for any annual meeting of the
shareholders, or at an adjournment thereof, the Board of Directors
shall cause the election to be held at a special meeting of the
shareholders as soon thereafter as conveniently may be.
6/ Section 2. Special Meetings. Special meetings of the
shareholders, for any purpose or purposes, unless otherwise prescribed
by statute, may be called by the President or by a majority of the
Board of Directors, and shall be called by the President at the
request of the holders of not less than one-half of all the
outstanding shares of the Corporation entitled to vote at the meeting.
16/ Section 3. Place of Meeting. The Board of Directors may
designate any place, either within or without the State of Wisconsin,
as the place of meeting for any annual meeting or for any special
meeting. If no designation is made, or if a special meeting be
otherwise called, the place of meeting shall be the registered office
of the Corporation in the State of Wisconsin.
7/16/ Section 4. Notice of Meeting. Written notice stating the
place, day and hour of the meeting and, in case of a special meeting,
the purpose or purposes for which the meeting is called, shall be
delivered not less than ten days (or, in the case of a special meeting
called at the request of shareholders, not less than twenty-five days)
nor more than sixty (60) days before the date of the meeting, either
personally or by mail, by or at the direction of the President, or the
Secretary, or the officer or persons calling the meeting, to each
shareholder of record entitled to vote at such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the
United States mail, addressed to the shareholder at his address as it
appears on the stock record books of the Corporation, with postage
thereon prepaid .
16/ Section 5. Voting and Record Date. At each meeting of
shareholders, whether annual or special, each shareholder shall be
entitled to vote in person or by proxy appointed by an instrument in
writing subscribed by such shareholder, and each shareholder shall
have one vote for each share registered in his or her name on the
books of the Corporation at the close of business on a record date
which shall be not more than seventy (70) days prior to the date of
the meeting as such record date is fixed by the Board of Directors.
16/ Section 6. Voting Lists. The officer or agent having charge of
the stock transfer books for shares of the Corporation shall, before
each meeting of shareholders, make a complete list of the shareholders
entitled to vote at such meeting, or any adjournment thereof, with the
address of and the number of shares held by each, which list shall be
available for inspection by any shareholder beginning two (2) business
days after notice of the meeting is given for which the list was
prepared and continuing to the date of the meeting at the
Corporation's principal office and at the time and place of the
meeting during the whole time of the meeting. The original stock
transfer books shall be prima facie evidence as to who are the
shareholders entitled to examine such list or transfer books or to
vote at any meeting of shareholders. Failure to comply with the
requirements of this section shall not affect the validity of any
action taken at such meeting.
Section 7. Quorum. A majority of the outstanding shares of the
Corporation entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of shareholders. Though less than a
quorum of the outstanding shares are represented at a meeting, a
majority of the shares so represented may adjourn the meeting from
time to time without further notice. At such adjourned meeting at
which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as
originally notified.
Section 8. Proxies. At all meetings of shareholders, a
shareholder entitled to vote may vote by proxy appointed in writing by
the shareholder or by his duly authorized attorney in fact. Such
proxy shall be filed with the Secretary of the Corporation before or
at the time of the meeting. No proxy shall be valid after eleven
months from the date of its execution, unless otherwise provided in
the proxy. The Board of Directors shall have the power and authority
to make rules establishing presumptions as to the validity and
sufficiency of proxies.
Section 9. Voting of Shares. Each outstanding share entitled
to vote shall be entitled to one vote upon each matter submitted to a
vote at a meeting of shareholders.
16/ Section 10. Waiver of Notice by Shareholders. Whenever any
notice whatever is required to be given to any shareholder of the
Corporation under the provisions of these By-Laws or under the
provisions of the Articles of Incorporation or under the provisions of
any Statute, a waiver thereof in writing, signed at any time, whether
before or after the time of meeting, by the shareholder entitled to
such notice, shall be deemed equivalent to the giving of such notice;
provided that such waiver in respect to any matter of which notice is
required under any provision of Chapter 180, Wisconsin Statutes, shall
contain the same information as would have been required to be
included in such notice, except the time and place of meeting.
16/ Section 11. Informal Action by Shareholders. Any action
required to be taken at a meeting of the shareholders, or any other
action which may be taken at a meeting of the shareholders, may be
taken without a meeting if a consent in writing, setting forth the
action so taken, shall be signed by all of the shareholders entitled
to vote with respect to the subject matter thereof.
ARTICLE III.
BOARD OF DIRECTORS
Section 1. General Powers. The business and affairs of the
Corporation shall be managed by its Board of Directors.
6/8/9/10/11/13/14/15/17/18/
Section 2. Number, Tenure and Qualifications. The number of
Directors of the Corporation shall not be less than seven (7) nor more
than nine (9). The Directors shall be divided into three classes
which are as nearly equal in number as circumstances permit from time
to time. Each Director shall be elected to serve a term of three (3)
years (except that directors may be elected for shorter terms as
necessary in order to fill vacancies in particular classes of
Directors), and the respective terms of all directors of one class
shall expire at each annual meeting of shareholders. Each Director
shall hold office for the term for which he is elected and until his
successor is elected and qualified, or until his death, or until he
shall resign or shall have been removed in the manner provided in the
Articles of Incorporation. Directors need not be residents of the
State of Wisconsin or shareholders of the Corporation. Any Director
that is also an employee shall, upon retirement or resignation as an
employee, cease to be a member of the Board of Directors.
12/16/
Section 3. Nomination of Directors. Only persons who are
nominated in accordance with the following procedures shall be
eligible for election as Directors. Nominations of persons for
election to the Board of Directors of the Corporation at the annual
meeting may be made at a meeting of shareholders by or at the
direction of the Board of Directors by any nominating committee or
person appointed by the Board of Directors or by any shareholder of
the Corporation entitled to vote for the election of Directors at the
meeting who complies with the notice procedures set forth in this
Section 3. Such nominations, other than those made by or at the
direction of the Board of Directors, shall be made pursuant to timely
notice in writing to the Secretary of the Corporation. To be timely,
a shareholder's notice shall be delivered to or mailed and received at
the principal executive offices of the Corporation not less than fifty
(50) days nor more than seventy-five (75) days prior to the meeting
date set under the provisions of these By-Laws; provided, however,
that in the event that the meeting is not held within ten (10)
business days of the date set in these By-Laws and less than sixty-
five (65) days' notice or prior public disclosure of the date of the
meeting is given or made to shareholders, notice by the shareholder to
be timely must be so received not later than the close of business on
the fifteenth (15th) day following the day on which such notice of the
date of the meeting was mailed or such public disclosure was made,
whichever first occurs. Such shareholder's notice to the Secretary
shall set forth (a) as to each person whom the shareholder proposes to
nominate for election or re-election as a Director, (i) the name, age,
business address and residence address of the person, (ii) the
principal occupation or employment of the person, (iii) the class and
number of shares of capital stock of the Corporation which are
beneficially owned by the person, and (iv) any other information
relating to the person that is required to be disclosed in
solicitations for proxies for election of Directors pursuant to
[Regulation 14A] under the Securities Exchange Act of 1934, as
amended; and (b) as to the shareholder giving the notice (i) the name
and record address of the shareholder and (ii) the class and number of
shares of capital stock of the Corporation which are beneficially
owned by the shareholder. The Corporation may require any proposed
nominee to furnish such other information as may reasonably be
required by the Corporation to determine the eligibility of such
proposed nominee to serve as a Director of the Corporation. No person
shall be eligible for election as a Director of the Corporation unless
nominated in accordance with the procedures set forth herein.
The Chairman of the meeting shall, if the facts warrant,
determine and declare to the meeting that a nomination was not made in
accordance with the foregoing procedure, and if he should so
determine, he shall so declare to the meeting and the defective
nomination shall be disregarded.
1/12/16/
Section 4. Regular Meetings. A regular meeting of the Board of
Directors shall be held within 30 days after the annual meeting of
shareholders, and each adjourned session thereof, and at any other
time as determined by the Board of Directors. Regular meetings of the
Board of Directors may be held without notice at such time and at such
place as may from time to time be determined by the Board of
Directors.
12/ Section 5. Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the President,
Secretary or any two Directors. The person or persons authorized to
call special meetings of the Board of Directors may fix any place,
within the Continental United States, as the place for holding any
special meeting of the Board of Directors called by them.
12/16/
Section 6. Notice. Notice of any special meeting of the Board
of Directors shall be given at least forty-eight (48) hours before the
date of the meeting or on such shorter notice as the person or persons
calling such meeting may deem necessary or appropriate in the
circumstances, by word of mouth, telephone or radiophone personally,
or written notice mailed to each Director at his business address, or
by telegram. Whenever any notice is required to be given to any
Director of the Corporation under the provisions of these By-Laws or
under the provisions of the Articles of Incorporation or under the
provisions of any Statute, a waiver thereof in writing, signed at
any time, whether before or after the time of meeting, by the Director
entitled to such notice, shall be deemed equivalent to the giving of
such notice. The attendance of a Director at a meeting shall
constitute a waiver of notice of such meeting, except where a Director
attends a meeting and objects thereat to the transaction of any
business because the meeting is not lawfully called or convened.
Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the Board of Directors need be specified
in the notice or waiver of notice of such meeting.
Section 7. Quorum. A majority of the number of Directors fixed
by Section 2 of this Article III shall constitute a quorum for the
transaction of business at any meeting of the Board of Directors, but
though less than such quorum is present at a meeting, a majority of
the Directors present may adjourn the meeting from time to time
without further notice.
Section 8. Manner of Acting. The act of a majority of the
Directors present at a meeting at which a quorum is present shall be
the act of the Board of Directors, unless the act of a greater number
is required by these By-Laws or By-Law.
6/ Section 9. Vacancies. Any vacancy occurring in the Board of
Directors, including a vacancy created by an increase in the number of
Directors, may be filled for the balance, if any, of the unexpired
term by the affirmative vote of a majority of the Directors then in
office, though less than a quorum of the Board of Directors. For the
purposes of this section, the term "vacancy" shall include the
disability of any Director to the point where he cannot attend
Directors' meetings or effectively discharge his duties as a Director.
Section 10. Compensation. The Board of Directors, by
affirmative vote of a majority of the Directors then in office, and
irrespective of any personal interest of any of its members, may
establish reasonable compensation of any or all Directors for services
to the Corporation as Directors, officers or otherwise, or may
delegate such authority to an appropriate committee.
Section 11. Presumption of Assent. A Director of the
Corporation who is present at a meeting of the Board of Directors or a
committee thereof at which action on any corporate matter is taken
shall be presumed to have assented to the action taken unless his
dissent shall be entered in the minutes of the meeting or unless he
shall file his written dissent to such action with the person acting
as the Secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the Secretary of the
Corporation immediately after the adjournment of the meeting. Such
right to dissent shall not apply to a Director who voted in favor of
such action.
Section 12. Committees. The Board of Directors by resolution
adopted by the affirmative vote of a majority of the number of
Directors fixed by Section 2 of the Article III may designate one or
more committees, each committee to consist of three or more Directors
elected by the Board of Directors, which to the extent provided in
said resolution as initially adopted, and as thereafter supplemented
or amended by further resolution adopted by a like vote shall have and
may exercise, when the Board of Directors is not in session, the
powers of the Board of Directors in the management of the business and
affairs of the Corporation, except action with respect to declaration
of dividends to shareholders, election of officers or the filling of
vacancies in the Board of Directors or committees created pursuant to
this section. The Board of Directors may elect one or more of its
members as alternate members of any such committee who may take the
place of any absent member or members at any meeting of such
committee, upon request by the President or upon request by the
Chairman of such meeting. Each such committee shall fix its own rules
governing the conduct of its activities and shall make such reports to
the Board of Directors of its activities as the Board of Directors may
request.
4/ Section 13. Informal Action by Directors and Committees. Any
action required to be taken at a meeting of the Board of Directors or
a committee thereof, or any action which may be taken at a meeting of
the Board of Directors, or a committee thereof, may be taken without a
meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the Directors, or members of a committee
thereof, entitled to vote with respect to the subject matter thereof.
14/16/
Section 14. Telephonic Meetings. Unless otherwise provided by
the Articles of Incorporation or these By-Laws, the Board of Directors
of the Corporation (and any committees thereof) may participate in
regular or special meetings by, or through the use of, any means of
communication by which (i) all Directors participating may
simultaneously hear each other, such as by conference telephone, or
(ii) all communication is immediately transmitted to each
participating Director, and each participating Director can
immediately send messages to all other participating Directors. A
Director participating in a meeting by such means shall be deemed
present in person at such meeting. If action is to be taken at any
such telephonic Board of Directors meeting on any of the following:
(i) a plan of merger or consolidation; (ii) a sale, lease, exchange or
other disposition of substantial property or assets of the
Corporation; (iii) a voluntary dissolution or the revocation of
voluntary dissolution proceedings; or (iv) a filing for bankruptcy,
then the identity of each Director participating in such meeting must
be verified by the disclosure of each such Director's social security
number to the Secretary of the Corporation before a vote may be taken
on any of the foregoing matters.
3/ ARTICLE IV.
OFFICERS
5/ Section 1. Number. The principal officers of the Corporation
shall be a Chairman of the Board (if the Board of Directors
determines to elect one), a Vice Chairman of the Board (if the Board
determines to elect one), a President, one or more Vice Presidents,
one or more of whom may be designated Executive Vice President and one
or more of whom may be designated Senior Vice President, a Secretary,
and a Treasurer, each of whom shall be elected by the Board of
Directors. Such other officers and assistant officers as may be
deemed necessary may be elected or appointed by the Board of
Directors. Any two or more offices may be held by the same person,
except the offices of President and Vice President and President and
Secretary. The duties of the officers shall be those enumerated
herein and any further duties designated by the Board of Directors.
The duties herein specified for particular officers may be transferred
to and vested in such other officers as the Board of Directors shall
elect or appoint, from time to time and for such periods or without
limitation as to time as the Board shall order.
Officers of the Corporation may apply their titles to their
duties on behalf of the various divisions of the Corporation. The
Board of Directors may, as it deems necessary, authorize the use of
additional official titles by individuals whose duties in behalf of
the various divisions of the Corporation so warrant, the authority of
such divisional offices to be confined to the appropriate divisions.
Section 2. Election and Term of Office. The officers of the
Corporation to be elected by the Board of Directors shall be elected
annually by the Board of Directors at the first meeting of the Board
of Directors held after each annual meeting of the shareholders. If
the election of officers shall not be held at such meeting, such
election shall be held as soon thereafter as conveniently may be.
Each officer shall hold office until his successor shall have been
duly elected or until his prior death, resignation or removal.
Section 3. Removal. Any officer or agent may be removed by the
Board of Directors whenever in its judgment the best interests of the
Corporation will be served thereby, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed.
Election or appointment shall not of itself create contract rights.
Section 4. Vacancies. A vacancy in any principal office
because of death, resignation, removal, disqualification or otherwise,
shall be filled by the Board of Directors for the unexpired portion of
the term.
Section 5. Chairman of the Board. The Chairman of the Board
(if the Board of Directors determines to elect one) shall preside at
all meetings of the Board of Directors and shall have such further and
other authority, responsibility and duties as may be granted to or
imposed upon him by the Board of Directors, including without
limitation his designation pursuant to Section 7 as Chief Executive
Officer of the Corporation.
5/ Section 6. Vice Chairman of The Board. The Vice Chairman of
the Board (if the Board of Directors determines to elect one) shall,
in the absence of the Chairman of the Board, preside at all meetings
of the Board of Directors and shall have such further and other
authority, responsibility and duties as may be granted to or imposed
upon him by the Board of Directors, including without limitation his
designation pursuant to Section 8 as Chief Executive Officer of the
Corporation.
5/ Section 7. President. The President, unless the Board of
Directors shall otherwise order pursuant to Section 8, shall be the
Chief Executive Officer of the Corporation and, subject to the control
of the Board of Directors, shall in general supervise and control all
of the business and affairs of the Corporation. He shall, when
present, preside at all meetings of the shareholders and shall preside
at all meetings of the Board of Directors unless the Board shall have
elected a Chairman of the Board of Directors. He shall have
authority, subject to such rules as may be prescribed by the Board of
Directors, to appoint such agents and employees of the Corporation as
he shall deem necessary, to prescribe their powers, duties and
compensation, and to delegate authority to them. Such agents and
employees shall hold office at the discretion of the President. He
shall have authority to sign, execute and acknowledge, on behalf of
the Corporation, all deeds, mortgages, bonds, stock certificates,
contracts, leases, reports and all other documents or instruments
necessary or proper to be executed in the course of the Corporation's
regular business or which shall be authorized by resolution of the
Board of Directors; and except as otherwise provided by law or the
Board of Directors, he may authorize any Vice President or other
officer or agent of the Corporation to sign, execute and acknowledge
such documents or instruments in his place and stead. In general, he
shall perform all duties incident to the office of the Chief Executive
Officer and such other duties as may be prescribed by the Board of
Directors from time to time. In the event the Board of Directors
determines not to elect a Chairman of the Board or a Vice Chairman of
the Board, or in the event of his or their absence or disability, the
President shall perform the duties of the Chairman of the Board and
when so acting shall have all the powers of and be subject to all of
the duties and restrictions imposed upon the Chairman of the Board.
5/ Section 8. Chairman of the Board as Chief Executive Officer.
The Board of Directors may designate the Chairman of the Board, the
Vice Chairman of the Board or the President, as the Chief Executive
Officer of the Corporation. In any such event, the Chairman of the
Board, the Vice Chairman of the Board or the President, shall assume
all authority, power, duties and responsibilities otherwise appointed
to the President pursuant to Section 7, and all references to the
President in these By-Laws shall be regarded as references also to the
Chairman of the Board or Vice Chairman of the Board, as such Chief
Executive Officer, except where a contrary meaning is clearly
required.
In further consequence of designating the Chairman of the Board
or the Vice Chairman of the Board as the Chief Executive Officer, the
President shall thereby become the Chief Operating Officer of the
Corporation. He shall, in the absence of the Chairman of the Board or
of the Vice Chairman of the Board, preside at all meetings of
shareholders and Directors. During the absence or disability of the
Chairman of the Board or the Vice Chairman of the Board, he shall
exercise the functions of the Chief Executive Officer of the
Corporation. He shall have authority to sign all certificates,
contracts, and other instruments of the Corporation necessary or
proper to be executed in the course of the Corporation's regular
business or which shall be authorized by the Board of Directors and
shall perform all such other duties as are incident to his office or
are properly required of him by the Board of Directors, the Chairman
of the Board or the Vice Chairman of the Board. He shall have the
authority, subject to such rules, directions, or orders, as may be
prescribed by the Chairman of the Board or the Vice Chairman of the
Board, or the Board of Directors, to appoint and terminate the
appointment of such agents and employees of the Corporation as he
shall deem necessary, to prescribe their power, duties and
compensation and to delegate authority to them.
5/ Section 9. The Vice Presidents. At the time of election, one
or more of the Vice Presidents may be designated Executive Vice
President and one or more of the Vice Presidents may be designated
Senior Vice President. In the absence of the President or in the
event of his death, inability or refusal to act, or in the event for
any reason it shall be impracticable for the President to act
personally, the Executive Vice President, or if more than one, the
Executive Vice Presidents in the order designated at the time of their
election, or in the absence of any such designation, then in the order
of their election, or in the event of his or their inability to act
then the Senior Vice President or if more than one, the Senior Vice
Presidents in the order designated at the time of their election, or
in the absence of any such designation then in the order of their
election, or in the event of his or their inability to act, then the
other Vice Presidents in the order designated at the time of their
election, or in the absence of any such designation, then in the order
of their election, shall perform the duties of the President and when
so acting shall have all the powers of and be subject to all the
restrictions upon the President. Any Vice President may sign with the
Secretary or Assistant Secretary certificates for shares of the
Corporation and shall perform such other duties as from time to time
may be assigned to him by the President or the Board of Directors.
5/ Section 10. The Secretary. The Secretary shall: (a) keep the
minutes of the meetings of the shareholders and of the Board of
Directors in one or more books provided for that purpose; (b) see that
all notices are duly given in accordance with the provisions of these
By-Laws or as required by law; (c) be custodian of the Corporate
Records and of the Seal of the Corporation and see that the Seal of
the Corporation is affixed to all documents the execution of which on
the behalf of the Corporation under its seal is duly authorized; (d)
keep or arrange for the keeping of a register of the post office
address of each shareholder which shall be furnished to the Secretary
by such shareholder; (e) sign with the President, or a Vice President,
certificates for shares of the Corporation, the issuance of which
shall have been authorized by resolution of the Board of Directors;
(f) have general charge of the stock transfer books of the
Corporation; and (g) in general perform all duties incident to the
office of Secretary and have such other duties and exercise such
authority as from time to time may be delegated or assigned to him by
the President or by the Board of Directors.
5/ Section 11. The Treasurer. The Treasurer shall: (a) have
charge and custody and be responsible for all funds and securities of
the Corporation; (b) receive and give receipts for moneys due and
payable to the Corporation from any source whatsoever, and deposit all
such moneys in the name of the Corporation in such banks, trust
companies or other depositories as shall be selected in accordance
with the provisions of Section 4, Article V; and (c) in general
perform all of the duties incident to the office of Treasurer and have
such other duties and exercise such other authority as from time to
time may be delegated or assigned to him by the President or by the
Board of Directors. If required by the Board of Directors, the
Treasurer shall give a bond for the faithful discharge of his duties
in such sum and with such surety or sureties as the Board of Directors
shall determine.
5/ Section 12. Assistant Secretaries and Assistant Treasurers.
There shall be such number of Assistant Secretaries and Assistant
Treasurers as the Board of Directors may from time to time authorize.
The Assistant Secretaries may sign with the President or a Vice
President certificates for shares of the Corporation, the issuance of
which shall have been authorized by a resolution of the Board of
Directors. The Assistant Treasurers shall respectively, if required
by the Board of Directors, give bonds for the faithful discharge of
their duties in such sums and with such sureties as the Board of
Directors shall determine. The Assistant Secretaries and Assistant
Treasurers, in general, shall perform such duties and have such
authority as shall from time to time be delegated or assigned to them
by the Secretary or the Treasurer, respectively, or by the President
or the Board of Directors.
5/ Section 13. Other Assistants and Acting Officers. The Board of
Directors shall have the power to appoint any person to act as
assistant to any officer, or as agent for the Corporation in his
stead, or to perform the duties of such officer whenever for any
reason it is impracticable for such officer to act personally, and
such assistant or acting officer or other agent so appointed by the
Board of Directors shall have the power to perform all the duties of
the office to which he is so appointed to be assistant, or as to which
he is so appointed to act, except as such power may be otherwise
defined or restricted by the Board of Directors.
5/ Section 14. Salaries. The salaries of the principal officers
shall be fixed from time to time by the Board of Directors or by a
duly authorized committee thereof, and no officer shall be prevented
from receiving such salary by reason of the fact that he is also a
Director of the Corporation.
4/5/16/
Section 15. Liability of Directors and Officers and Employee
Fiduciaries. No Director shall be liable to the Corporation, its
shareholders, or any person asserting rights on behalf of the
Corporation or its shareholders, for damages, settlements, fees,
fines, penalties or other monetary liabilities arising from a breach
of, or failure to perform, any duty resulting solely from his or her
status as a Director, unless the person asserting liability proves
that the breach or failure to perform constitutes any of the
following: (a) willful failure to deal fairly with the Corporation or
its shareholders in connection with a matter in which the Director has
a material conflict of interest; (b) violation of criminal law, unless
the Director had reasonable cause to believe that his or her conduct
was lawful or no reasonable cause to believe that his or her conduct
was unlawful; (c) transaction from which the Director derived an
improper personal profit; (d) willful misconduct. No person shall be
liable to the Corporation for any loss or damage suffered by it on
account of any action taken or omitted to be taken by him as an
officer, or employee fiduciary as that term is defined in the
Employment Retirement Security Act of 1974 (hereinafter, and in
Section 15 of this Article IV, called "employee fiduciary") of the
Corporation or of any other corporation which he serves as an officer,
or employee fiduciary at the request of the Corporation, in good
faith, if such person (a) exercised and used the same degree of care
and skill as a prudent man would have exercised or used under the
circumstances in the conduct of his own affairs, or (b) took or
omitted to take such action in reliance upon advice of counsel for the
Corporation or upon statements made or information furnished by
officers or employees of the Corporation which he had reasonable
grounds to believe to be true. The foregoing shall not be exclusive
of other rights and defenses to which he may be entitled as a matter
of law.
4/5/16/
Section 16. Indemnity of Officers and Directors and Employee
Fiduciaries. Every person who is or was a Director or officer or
employee fiduciary of the Corporation, and any person who may have
served at its request as a Director or officer or employee fiduciary
of another Corporation in which it owns shares of capital stock or of
which it is a creditor, shall (together with the heirs, executors and
administrators of such person) be indemnified by the Corporation
against all costs, damages and expenses asserted against, incurred by
or imposed upon him in connection with or resulting from any claim,
action, suit or proceeding, including criminal proceedings, to which
he is made or threatened to be made a party by reason of his being or
having been such Director or officer or employee fiduciary, upon a
determination by or on behalf of the Corporation that the Director,
officer or employee fiduciary did not breach or fail to perform a duty
constituting any of the following: (a) willful failure to deal fairly
with the Corporation or its shareholders in connection with a matter
in which the Director or officer has a material conflict of interest;
(b) violation of the criminal law, unless the Director or officer had
reasonable cause to believe that his or her conduct was lawful or no
reasonable cause to believe that his or her conduct was unlawful; (c)
transaction from which the Director or officer derived an improper
personal profit; (d) willful misconduct. This indemnity shall include
reimbursement of amounts and expenses incurred and paid in settling
any such claim, action, suit or proceeding. The termination of a
proceeding by judgment, order, settlement or conviction or upon a plea
of guilty or nolo contendere or its equivalent shall not create a
presumption that such Director or officer or employee fiduciary is not
entitled to indemnification under this Section 16.
The Corporation, by its Board of Directors, may indemnify in like
manner, or with any limitations, any employee or former employee of
the Corporation with respect to any action taken or not taken in his
capacity as such employee.
The foregoing rights of indemnification shall be in addition to
all rights to which officers, Directors or employees may be entitled
as a matter of law.
ARTICLE V.
CONTRACTS, LOANS, CHECKS AND DEPOSITS
3/ Section 1. Contracts. The Board of Directors may authorize any
officer or officers, agent or agents, to enter into any contract or
execute or deliver any instrument in the name of and on behalf of the
Corporation, and such authorization may be general or confined to
specific instances. In the absence of other designation, all deeds,
mortgages and instruments of assignment or pledge made by the
Corporation shall be executed in the name of the Corporation by the
President or one of the Vice Presidents and by the Secretary, an
Assistant Secretary, the Treasurer or an Assistant Treasurer, the
Secretary or an Assistant Secretary, when necessary or required, shall
affix the Corporate Seal thereto; and when so executed no other party
to such instrument or any third party shall be required to make any
inquiry into the authority of the signing officer or officers.
Section 2. Loans. No loans shall be contracted on behalf of
the Corporation and no evidence of indebtedness shall be issued in its
name unless authorized by or under the authority of a resolution of
the Board of Directors. Such authorization may be general or confined
to specific instances.
Section 3. Checks, Drafts, Etc. All checks, drafts or other
orders for the payment of money, notes or other evidences of
indebtedness issued in the name of the Corporation, shall be signed by
such officer or officers, agent or agents of the Corporation and in
such manner as shall from time to time be determined by or under the
authority of resolution of the Board of Directors.
Section 4. Deposits. All funds of the Corporation not
otherwise employed shall be deposited from time to time to the credit
of the Corporation in such banks, trust companies or other
depositaries as may be selected by or under the authority of the Board
of Directors.
ARTICLE VI.
CERTIFICATES FOR SHARES AND THEIR TRANSFERS
Section 1. Certificates for Shares. Certificates representing
shares of the Corporation shall be in such form as shall be determined
by the Board of Directors. Such certificates shall be signed by the
President or a Vice President and by the Secretary or an Assistant
Secretary. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the person
to whom the shares represented thereby are issued, with the number of
shares and date of issue, shall be entered on the stock transfer books
of the Corporation. All certificates surrendered to the Corporation
for transfer shall be canceled and no new certificates shall be issued
until the former certificate for a like number of shares shall have
been surrendered and canceled, except that in case of a lost,
destroyed or mutilated certificate a new one may be issued therefor
upon such terms and indemnity to the Corporation as the Board of
Directors may prescribe.
Section 2. Facsimile Signatures and Seal. The Seal of the
Corporation on any certificates for shares may be a facsimile. The
signatures of the President or Vice President and the Secretary or
Assistant Secretary upon a certificate may be facsimiles if the
certificate is countersigned by a transfer agent, or registered by a
registrar, other than the Corporation itself or an employee of the
Corporation.
Section 3. Signature by Former Officers. In case any officer
who has signed or whose facsimile signature has been placed upon any
certificate for shares, shall have ceased to be such officer before
such certificate is issued, it may be issued by the Corporation with
the same effect as if he were such officer at the date of its issue.
Section 4. Transfer of Shares. Transfer of shares of the
Corporation shall be made only on the stock transfer books of the
Corporation by the holder of record thereof or by his legal
representative, who shall furnish proper evidence of authority to
transfer, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary of the Corporation or the
Corporation's transfer agent, and on surrender for cancellation of the
certificate for such shares. The person in whose name shares stand on
the books of the Corporation shall be deemed by the Corporation to be
the owner thereof for all purposes.
Section 5. Lost, Destroyed or Stolen Certificates. Where the
owner claims that his certificate for shares has been lost, destroyed
or wrongfully taken, a new certificate shall be issued in place
thereof if the owner (a) so requests before the Corporation has notice
that such shares have been acquired by a bona fide purchaser, and (b)
files with the Corporation a sufficient indemnity bond, and (c)
satisfies such other reasonable requirements as the Board of Directors
may prescribe.
Section 6. Stock Regulations. The Board of Directors shall
have the power and authority to make all such further rules and
regulations not inconsistent with the Statutes of the State of
Wisconsin as they may deem expedient concerning the issue, transfer
and registration of certificates representing shares of the
Corporation.
ARTICLE VII.
FISCAL YEAR
20/ Section 1. Fiscal Year. The fiscal year of the Corporation
shall end on the thirty-first day of December of each calendar year.
ARTICLE VIII.
DIVIDENDS
Section 1. Dividends. The Board of Directors may from time to
time declare, and the Corporation may pay, dividends on its
outstanding shares in the manner and upon the terms and conditions
provided by law and its Articles of Incorporation.
Section 2. Record Date. The Board of Directors may, but shall
not be obligated to, order the stock books of the Corporation closed
so as to prevent any stock from being transferred of record for a
period not exceeding two (2) weeks prior to the date fixed for the
payment of any dividend, or in the alternative, may fix a record date
for the determination of those shareholders entitled to receive such
dividend, which record date, if so fixed, shall be not more than four
(4) weeks prior to the date fixed for the payment of such dividend.
ARTICLE IX.
SEAL
Section 1. Seal. The Board of Directors shall provide a
Corporate Seal which shall be circular in form and shall have
inscribed thereon the name of the Corporation and the State of
Incorporation and the words "Corporate Seal."
6/ ARTICLE X.
AMENDMENTS
Section 1. By Shareholders. These By-Laws may be altered,
amended or repealed and new By-Laws adopted by a vote of the holders
of a majority of outstanding shares entitled to vote which are present
at any annual or special meeting of the shareholders at which a quorum
is in attendance; provided, however, that no amendment of Section 2
of Article II, or of Section 2 or Section 9 of Article III, or of
this Article X, by the shareholders shall be effective unless it shall
have been adopted by a vote of the holders of not less than two-thirds
(2/3) of all outstanding shares entitled to vote.
Section 2. By Directors. These By-Laws may also be altered,
amended or repealed and new By-Laws adopted by the Board of Directors
by affirmative vote of a majority of the entire Board of Directors,
but no By-Law adopted by the shareholders shall be amended or repealed
by the Board of Directors if the By-Law so adopted so provides.
21/ Section 3. Implied Amendments. Any action taken or authorized
by the shareholders or by the Board of Directors, which would be
inconsistent with the By-Laws then in effect but is taken or
authorized by a vote that would be sufficient to amend the By-Laws so
that the By-Laws would be consistent with such action, shall be given
the same effect as though the By-Laws had been temporarily amended or
suspended so far, but only so far, as is necessary to permit the
specific action so taken or authorized.
THIS INSTRUMENT DRAFTED
BY
ATTORNEY A. F. RANKIN,
MANITOWOC, WISCONSIN
EXHIBIT 10.1(b)
1994 10-K
EXCERPT FROM MINUTES OF THE MANITOWOC COMPANY,
INC. BOARD OF DIRECTORS MEETING HELD ON APRIL 26, 1994
RESOLVED that The Manitowoc Company, Inc. Deferred Compensation
Plan, as effective July 4, 1993, is amended, effective as of this
date, as follows:
1. Section 3.4 shall be revised to read in its entirety as
follows:
3.4 A non-employee director Participant may make a deferral
election with respect to all or part of his Compensation, in
increments of five percent (5%). A key employee Participant may make
separate deferral elections, in whole percentages, with respect to
regular pay and incentive bonuses. Deferral elections shall not
exceed forty percent (40%) of regular pay for any Plan Year and
deferral elections with regard to incentive bonuses are not subject to
a percentage maximum; provided, however, that the maximum amount of
Compensation of a key employee Participant for any Plan Year which may
be considered for purposes of determining the Company contribution
authorized by Section 7.1 shall not exceed twenty-five percent (25%)
for any Plan Year. Deferral elections remain in effect from year to
year until modified or revoked in accordance with Plan rules.
2. Section 7.1 is amended by adding at the end thereof "and
Section 3.4".
FURTHER RESOLVED, that the foregoing changes shall be incorporated
in revised pages of the Plan.
FURTHER RESOLVED, that the Treasurer of the Company is authorized
and directed to make any technical amendments to the continuing Plan
in order to facilitate the foregoing amendments.
FURTHER RESOLVED, that the foregoing Plan amendments do not
materially increase benefits provided by the Company to Plan
Participants such that additional stockholder approval under Section
9.5 of the Plan is not required.
EXHIBIT 13
1994 10-K
PORTIONS OF THE 1994 ANNUAL REPORT TO SHAREHOLDERS
OF THE MANITOWOC COMPANY, INC.
INCORPORATED BY REFERENCE
<TABLE>
<CAPTION>
QUARTERLY COMMON STOCK PRICE RANGE
The company's common stock is traded on the New York Stock Exchange.
Prior to May 27, 1993, the stock was traded over-the-counter on the NASDAQ National Market System.
1994 1993 1992
------------------------ ------------------------ -----------------------
Quarter High Low Close High Low Close High Low Close
---- ---- ----- ---- ---- ----- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1st $33.25 $30.38 $31.50 $23.50 $19.00 $23.13 $21.00 $18.00 $18.00
2nd 33.13 31.00 32.25 27.50 22.50 26.00 21.25 17.25 19.25
3rd 32.38 27.75 27.75 29.50 24.88 28.00 23.75 19.38 22.00
4th 28.25 24.88 25.13 32.50 27.75 32.25 24.50 21.25 21.88
</TABLE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
CONSOLIDATED
During fiscal 1994, The Manitowoc Company's consolidated sales
were down slightly to $275.4 million from $278.6 million in 1993.
Sales were $246.4 million in 1992. The 1% decrease in 1994 sales was
caused by a 13% decline in crane sales, which was not fully offset by
a 14% increase in foodservice sales, and a 40% increase in marine
sales.
Overall, the gross margin percentage was 25%, up from 20% in 1993
and 22% in 1992. The gross margin in fiscal 1993 was adversely
impacted by a $9.7-million crane inventory charge and a $4.3-million
crane product liability settlement. Without these items, fiscal 1993
gross margin would have been 25%.
Cost of goods sold, as computed using the last-in, first-out
(LIFO) method of accounting for inventories, was reduced in both
fiscal 1994 and 1993 due to inventory quantity reductions. As a
result of lower inventories, LIFO accounting added $1.7 million to net
earnings in 1994 and $1.9 million in 1993. These increases were
partially offset by increases in product liability, environmental and
other general reserves of $0.7 million and $1.2 million, respectively.
In fiscal 1993, the company adopted Statement of Financial
Accounting Standards (SFAS) No. 106 "Employer's Accounting For
Postretirement Benefits Other Than Pensions" and SFAS No. 109
"Accounting For Income Taxes" effective June 28, 1992. The cumulative
effect of adopting these standards was recorded as a charge to
earnings in 1993 of $8.0 million and $2.2 million for SFAS No. 106 and
109, respectively.
Engineering, selling and administrative expenses were $46.8 million,
down slightly from $47.4 million in 1993, but up 7% from $44.0 million in
1992. The Manitex relocation costs of $3.3 million increased administrative
expenses in 1993.
Operating earnings were $21.1 million in 1994, compared to $8.3
million in 1993 and $10.5 million in 1992. The drop in 1993 operating
margin was caused by the unusual expenses described above.
The effective income tax rate, exclusive of the effect of
accounting changes, was 38%, up from 29% in 1993 and 1992. See Note 6
in the Notes To Consolidated Financial Statements for a reconciliation
of the federal income tax at statutory rates and the provision for
income taxes as reported.
Net earnings increased substantially in 1994 to $14 million,
compared to a loss of $3.9 million in 1993. The net earnings decline
in 1993 was due to the crane inventory charges, a crane product
liability settlement, the Manitex relocation expenses and the
implementation of SFAS 106 and SFAS 109.
[GRAPH NO. 1 -- Reversing a four-year decline, Manitowoc's
operating earnings rebounded to $21 million during fiscal 1994. See
Appendix A]
CRANES AND RELATED PRODUCTS
Cranes and related products sales were down 13% to $156.3
million, compared to $178.6 million in 1993. Crane sales were $155.7
million in 1992. The 1994 decline in revenues was largely caused by a
decline in large crawler crane orders that began late in the first
half of the year. This decline was experienced at Manitowoc
Engineering Company, our crawler crane manufacturer, and our company
owned dealerships. The crane backlog was $46.5 million at the end of
1992, $57.7 million at the end of 1993, and $26.9 million at the end
of 1994. Parts and service revenues were $36.2 million for the year
compared to about $36.8 million in 1993 and 1992. Revenues from fleet
rentals were $5.8 million in 1994, $8.8 million in 1993 and $4.9
million in 1992. Export sales were $44.3 million in 1994, compared to
$54.6 million in 1993 and $31.2 million in 1992. In addition, foreign
sales from our non-U.S. operations were $14.1 million, compared to
$14.5 million in 1993 and $25.2 million in 1992.
Crane segment operating earnings in fiscal 1994 were $2.3 million
compared to losses of $5.3 million and $0.9 million in 1993 and 1992,
respectively. Included in the 1993 loss were: a $3.3 million boom
truck crane plant relocation charge, a $9.7 million charge for
inventory write downs, and $4.3 million for a product liability
settlement. Fiscal 1994 operating margins were adversely affected by
losses in the boom truck crane and company owned dealership
businesses, as well as costs incurred in the formation and start-up of
West-Manitowoc.
FOODSERVICE
Foodservice products revenues were up 14% to $93.2 million.
Fiscal 1993 sales of $81.4 million were up 10% from $74.2 million in
1992. The continued upward trend is due to steady growth in reach-in
refrigerator and freezer sales, a generally improving North American
ice machine market, a warmer than normal spring in 1994, and continued
success of the new B-models introduced during the second quarter of
fiscal 1993. Export sales were $11.4 million, up 14% and 36% from
1993 and 1992, respectively.
Operating earnings in the foodservice segment jumped to $21.6
million in 1994, compared to $18.3 million in 1993, and $17.6 million
in 1992, on continually increasing revenues. Operating margins have
held steady at about 23% during this three-year period.
MARINE
Marine segment sales jumped 40% to $26.0 million, compared to
$18.5 million in 1993. Fiscal 1992 sales were $16.5 million. The
acquisition of the Toledo and Cleveland ship-repair operations in mid
fiscal 1992 added $9.4 million to sales during the year, as well as
adding $9.3 million to revenues in 1993 and $5.1 million in 1992. The
Sturgeon Bay, Wisconsin, operation experienced a $7.3 million increase
in sales in 1993 due to the pick-up associated with being at the top
of the five-year cycle with respect to dry docking of the 1,000-foot
vessels plying the Great Lakes, and a general increase in demand for
ship repair.
Fiscal 1994 saw a 313% increase in marine segment operating
earnings, from $0.6 million in 1993 to $2.4 million. Comparable
earnings for 1992 were $0.3 million. The increase in earnings over
this three-year period reflect the much higher revenues and a more
favorable product mix.
[GRAPH NO. 2 -- In 1994, Manitowoc's gross margin improved $12
million, up 21% from $55.7 million in 1993. See Appendix A]
LIQUIDITY AND CAPITAL RESOURCES
Cash flow from operations was $37.0 million compared to $62.7
million in 1993, $28.3 million in 1992 and $6.5 million in 1991. Cash
flow in 1991 was depressed by a $14.2 million increase in working
capital (excluding cash and marketable securities), primarily from
inventory increases. Subsequently, 1992, 1993, and 1994 cash flows
were increased by working capital (excluding cash and marketable
securities) reductions of $7.2 million, $45.5 million, and $16.8
million, respectively primarily due to lower inventories. The
principal uses of cash in fiscal 1994 were $31.1 million to repurchase
stock, $10.7 million for the purchase of Femco Machine Co., $5.3
million for capital expenditures, and $8.7 million for dividends.
Cash and marketable securities were $30.1 million at year-end,
down from $48.8 million in 1993 and $37.4 million in 1992.
Inventories were down to $31.2 million from $34.2 million in 1993,
$64.9 million in 1992, and $84.3 million in 1991. The reduction is
the result of a concerted and ongoing program to eliminate slow-moving
and obsolete inventory, and improve inventory turns while enhancing
our competitive position with respect to customer responsiveness.
Since September 8, 1992, the board of directors has authorized
the company to repurchase a total of 3 million shares of common stock.
During 1994, the company repurchased 1.1 million shares of its common
stock through open market purchases at an average cost of $29 per
share. At the end of the year 762,000 shares remained under
authorization.
The Company continues to be debt free and expects that current
cash reserves and future cash flow from operations will meet
foreseeable liquidity requirements.
The United States Environmental Protection Agency (EPA) has
identified the company as a potentially responsible party (PRP) under
the Comprehensive Environmental Response Compensation and Liability
Act (CERCLA), liable for the costs associated with investigating and
cleaning up contamination at the Lemberger Landfill Superfund Site
(the Site) near Manitowoc, Wisconsin.
Eleven of the potentially responsible parties have formed a group
(the Lemberger Site Remediation Group, or LSRG) and have successfully
negotiated with the EPA and Wisconsin Department of Natural Resources
to settle the potential liability at the Site and fund the cleanup.
Approximately 150 PRP's have been identified as having shipped
substances to the Site.
Recent estimates indicate that the total cost to clean up the
site could be as high as $25 million; however, the ultimate
remediation methods and appropriate allocation of costs for the Site
are not yet final.
Although liability is joint and several, the company's percentage
share of liability is estimated to be 5% of the total cleanup costs,
but could increase to 15% if no participation agreements are made
between the LSRG and any other PRP's.
In connection with this matter, the company expenses $1.6
million, $0.5 million and $0.9 million in 1994, 1993, and 1992,
respectively, for its estimated portion of the cleanup costs. In
addition, the company has notified its insurance carrier requesting
reimbursement of incurred and future costs at the Site. Settlement of
this claim is uncertain; a recent Wisconsin Supreme Court decision did
not require an insurer to pay similar costs. Any recoveries from the
insurance carrier will be recognized when received.
In November 1992, the Financial Accounting Standards Board (FASB)
issued Statement No. 112, "Employers' Accounting for Postemployment
Benefits," which will be effective in fiscal year 1995. The adoption
of this statement will have no impact on the company's consolidated
financial statements.
In May 1993, the FASB issued Statement No. 115, "Accounting for
Certain Investments in Debt and Equity Securities," which will be
effective in fiscal year 1995. The company expects the adoption of
the new statement will not have a material effect on the company's
consolidated financial statements.
[GRAPH NO. 3 -- Although export shipments have risen and fallen in
individual years, the general trend has remained upward over the past
five years. See Appendix A]
<TABLE>
<CAPTION>
ELEVEN-YEAR RECORD
(In thousands, except shares and per share data)
Eleven-Year Financial Summary & Business Segment Information
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <S>
NET SALES:
Cranes and related
products $156,253 $178,630 $155,743 $147,554 $117,464 $102,430 $ 81,593 $46,571 $ 65,111 $ 56,879 $ 63,059
Foodservice 93,171 81,424 74,175 73,944 74,612 74,431 72,986 72,501 69,476 75,583 76,351
Marine 25,956 18,504 16,471 14,689 33,752 23,735 17,710 103,995 87,625 12,143 50,314
- - ------------------------------------------------------------------------------------------------------------------------------------
Total $275,380 $278,558 $246,389 $236,187 $225,828 $200,596 $172,289 $223,067 $222,212 $144,605 $189,724
- - ------------------------------------------------------------------------------------------------------------------------------------
Gross margin: $ 67,924 $ 55,785 $ 54,443 $ 58,062 $ 54,366 $ 50,860 $ 37,033 $ 29,921 $ 28,332 $ 34,244 $ 47,617
- - ------------------------------------------------------------------------------------------------------------------------------------
EARNINGS (LOSS) FROM
OPERATIONS:
Cranes and related
products $ 2,275 $ (5,261) $ (850) $ 7,602 $ 5,490 $ 3,454 $ (1,974)$ 4,532 $ (45,000) $(13,485) $(7,991)
Foodservice 21,637 18,311 17,585 17,364 19,387 18,468 17,203 17,910 17,735 26,357 28,717
Marine 2,447 593 278 (973) 6,497 3,416 (15,921) (9,693) (7,260) (5,726) 1,631
General corporate* (5,274) (5,296) (6,545) (5,734) (6,094) (5,623) (4,744) (3,628) (6,026) - -
- - -----------------------------------------------------------------------------------------------------------------------------------
Total 21,085 8,347 10,468 18,259 25,280 19,715 (5,436) 9,121 (40,551) 7,146 22,357
Other income - net 1,494 582 1,104 2,233 5,077 4,527 4,187 7,510 8,154 11,591 6,229
- - -----------------------------------------------------------------------------------------------------------------------------------
Earnings (loss) before
taxes on income 22,579 8,929 11,572 20,492 30,357 24,242 (1,249) 16,631 (32,397) 18,737 28,586
Accounting changes -- 10,214 -- -- -- -- -- -- -- -- --
Provision (credit) for
taxes on income 8,536 2,612 3,315 5,060 9,327 7,344 (1,341) 4,868 (18,587) 6,549 11,308
- - -----------------------------------------------------------------------------------------------------------------------------------
Net earnings (loss) $ 14,043 $(3,897) $ 8,257 $15,432 $21,030 $16,898 $ 92 $ 11,763 $ (13,810) $ 12,188 $17,278
- - -----------------------------------------------------------------------------------------------------------------------------------
IDENTIFIABLE ASSETS:
Cranes and related
products $ 93,823 $105,750 $138,416 $136,995 $115,804 $ 96,623 $ 75,217 $ 61,306 $ 59,321 $ 84,215 $76,792
Foodservice 31,460 29,526 25,608 28,019 24,168 26,074 27,449 33,486 28,465 30,749 29,277
Marine 16,726 16,720 19,253 18,009 22,683 32,451 24,049 41,366 24,824 24,866 28,662
General corporate 43,839 56,015 41,829 35,983 50,143 61,966 82,374 94,628 147,028 104,596 85,754
- - -----------------------------------------------------------------------------------------------------------------------------------
Total $185,848 $208,011 $225,106 $219,006 $212,798 $217,114 $209,089 $230,786 $ 259,638 $244,426 $220,485
- - -----------------------------------------------------------------------------------------------------------------------------------
DEPRECIATION:
Cranes & related
products $ 4,211 $ 3,875 $ 4,053 $ 3,691 $ 2,895 $ 2,953 $ 3,000 $ 2,972 $ 3,441 $ 4,027 $ 4,755
Foodservice 1,320 1,187 1,090 812 657 771 785 817 850 854 851
Marine 681 756 785 792 748 465 2,362 2,600 2,706 2,750 2,847
General corporate * 61 44 196 234 431 380 327 303 433 -- --
- - -----------------------------------------------------------------------------------------------------------------------------------
Total $ 6,273 $ 5,862 $ 6,124 $ 5,529 $ 4,731 $ 4,569 $ 6,474 $ 6,692 $ 7,430 $ 7,631 $ 8,453
- - -----------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL EXPENDITURES:
Cranes and related
products $ 3,120 $ 8,648 $ 4,047 $ 6,347 $ 3,130 $ 2,225 $ 2,264 $ 2,580 $ 3,111 $ 3,693 $ 1,078
Foodservice 2,300 2,152 1,099 2,797 748 (169) 229 201 338 753 571
Marine (492) (463) 500 113 197 108 1 112 1,334 624 6
General corporate ** 414 (39) (508) (2,955) 70 586 317 86 187 -- --
- - -----------------------------------------------------------------------------------------------------------------------------------
Total $ 5,342 $ 10,298 $ 5,138 $ 6,302 $ 4,145 $ 2,750 $ 2,811 $ 2,979 $ 4,970 $ 5,070 $ 1,655
- - -----------------------------------------------------------------------------------------------------------------------------------
PER SHARE:
Net earnings (loss) $ 1.61 $ (.40) $ .80 $ 1.50 $ 2.04 $ 1.64 $ .01 $ 1.08 $ (1.27) $ 1.12 $ 1.59
Dividends 1.00 1.00 1.00 1.00 2.00 .80 .80 .80 .80 .80 .80
Stockholders' equity 11.61 13.06 16.04 16.20 15.66 15.63 14.86 15.70 15.39 17.35 17.07
Average shares
outstanding 8,736 9,759 10,321 10,321 10,321 10,335 10,630 10,870 10,868 10,860 10,845
- - -----------------------------------------------------------------------------------------------------------------------------------
Average shares outstanding:
1994 8,736,594
1993 9,759,387
1992 10,320,847
1991 10,320,994
1990 10,321,249
1989 10,335,066
1988 10,630,104
1987 10,870,357
1986 10,867,617
1985 10,859,978
1984 10,844,989
<FN>
*Prior to 1986, all general corporate expenses were allocated to business segments.
**During 1991, certain assets were transferred from general corporate to the cranes and related products segment.
</TABLE>
[GRAPH NO. 4 -- By reducing our asset base, Manitowoc is adding value to
the company by making better use of its invested capital. See Appendix A]
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF EARNINGS
(In thousands, except per share and average shares data)
For the Years Ended July 2, 1994, July 3, 1993 and June 27, 1992
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
EARNINGS:
Net Sales $ 275,380 $ 278,558 $ 246,389
----------- ----------- -----------
Costs and expenses:
Cost of sales 207,456 222,773 191,946
Engineering, selling, and
administrative expenses 46,839 44,138 43,975
Plant relocation costs -- 3,300 --
----------- ----------- -----------
Total costs and expenses 254,295 270,211 235,921
----------- ----------- -----------
Earnings from operations 21,085 8,347 10,468
Interest and dividend income 1,697 1,328 1,861
Other expense - net (203) (746) (757)
----------- ----------- -----------
Earnings before taxes on income
and cumulative effect of
accounting changes 22,579 8,929 11,572
Provision for taxes on income 8,536 2,612 3,315
----------- ----------- -----------
Earnings before cumulative effect
of accounting changes 14,043 6,317 8,257
Cumulative effect of changes in
accounting for postretirement
medical benefits and income
taxes, net of tax -- (10,214) --
----------- ----------- -----------
Net earnings (loss) $ 14,043 $ (3,897) 8,257
----------- ----------- -----------
PER SHARE DATA:
Net earnings before cumulative
effect of accounting changes $ 1.61 $ .65 $ .80
Cumulative effect of accounting
changes -- (1.05) --
----------- ----------- -----------
Net earnings (loss) $ 1.61 $ (.40) $ .80
----------- ----------- -----------
AVERAGE SHARES OUTSTANDING 8,736,594 9,759,387 10,320,847
----------- ----------- -----------
<FN>
The accompanying summary of significant accounting policies and notes
to the consolidated financial statements are an integral part of these
statements.
</TABLE>
[GRAPH NO. 5 -- Although net sales declined slightly in 1994,
Manitowoc's consolidated net sales have risen nearly $50 million, up
21.9% since 1990. See Appendix A ]
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS
(In thousands, except shares and per share data)
As of July 2, 1994 and July 3, 1993
1994 1993
---- ----
<S> <C> <C>
ASSETS:
CURRENT ASSETS:
Cash and cash equivalents $ 15,094 $ 37,348
Marketable securities 15,008 11,488
Accounts receivable, less
allowances of $777 and $807 42,589 49,623
Inventories 31,240 34,200
Prepaid expenses and other 2,956 6,501
Future income tax benefits 10,770 8,841
--------- ---------
Total current assets 117,657 148,001
--------- ---------
Intangibles and other - net 4,859 3,030
Property, plant and equipment - net 63,332 56,980
--------- ---------
Total assets $ 185,848 $ 208,011
--------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY:
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 53,784 $ 52,884
Income taxes payable 4,859 128
Product warranties 4,967 5,393
--------- ---------
Total current liabilities 63,610 58,405
--------- ---------
NON-CURRENT LIABILITIES:
Product warranties 3,129 2,712
Deferred income taxes 1,310 2,357
Deferred employee expenses 17,688 17,177
Deferred income 3,811 5,765
Other 2,441 2,159
--------- ---------
Total non-current liabilities 28,379 30,170
--------- ---------
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Common stock (10,887,847 shares
issued in both years) 109 109
Preferred stock -- --
Additional paid-in capital 31,115 31,115
Cumulative foreign currency
translation adjustments (410) (569)
Retained earnings 134,433 129,078
Treasury stock, at cost (71,388) (40,297)
--------- ---------
Total stockholders' equity 93,859 119,436
--------- ---------
Total liabilities and stockholders' equity $ 185,848 $ 208,011
--------- ---------
<FN>
The accompanying summary of significant accounting policies and notes
to the consolidated financial statements are an integral part of these
balance sheets.
</TABLE>
[GRAPH NO. 6 -- With our tighter focus on improving the use of
invested capital, Manitowoc has aggressively cut inventories by $50
million since 1991. See Appendix A]
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands)
For the years ended July 2, 1994, July 3, 1993 and June 27, 1992
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
CASH FLOWS FROM OPERATIONS:
Net earnings (loss) $ 14,043 $ (3,897) $ 8,257
Non-cash adjustments to income:
Depreciation and amortization 6,401 6,048 6,300
Deferred income taxes (2,976) (1,449) 672
Accounting changes -- 10,214 --
Plant relocation costs -- 3,300 --
Changes in operating assets and
liabilities excluding effects
of business acquisitions:
Accounts receivable 9,352 7,259 (12,457)
Inventory 6,438 30,660 19,740
Other current assets 3,592 (3,403) (726)
Current liabilities 1,723 11,023 793
Non-current liabilities 669 1,606 642
Deferred income (1,954) 736 5,029
Non-current assets (293) 603 --
--------- --------- ---------
Net cash provided by operations 36,995 62,700 28,250
--------- --------- ---------
CASH FLOWS FROM INVESTING:
Proceeds from sale (purchase) of
marketable securities - net (3,520) (5,994) 3,571
Capital expenditures (5,342) (10,298) (5,138)
Business acquisitions -
net of cash acquired (10,685) -- (2,593)
Acquisition of other assets -- -- (2,270)
--------- --------- ---------
Net cash used for investing (19,547) (16,292) (6,430)
--------- --------- ---------
CASH FLOWS FROM FINANCING:
Dividends paid (8,688) (9,762) (10,321)
Treasury stock purchases (31,091) (30,518) --
--------- --------- ---------
Net cash used for financing (39,779) (40,280) (10,321)
--------- --------- ---------
Effect of exchange rate changes
on cash 77 (686) 262
--------- --------- ---------
Net change in cash and cash
equivalents (22,254) 5,442 11,761
Balance at beginning of year 37,348 31,906 20,145
--------- --------- ---------
Balance at end of year $ 15,094 $ 37,348 $ 31,906
--------- --------- ---------
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ 192 $ 45 $ 85
---------- --------- ---------
Income taxes paid $ 6,895 $ 8,076 $ 4,174
---------- --------- ---------
<FN>
The accompanying summary of significant accounting policies and notes
to the consolidated financial statements are an integral part of these
statements.
</TABLE>
[GRAPH NO. 7 AND 8 -- Although net earnings have varied considerably
during the past five years, Manitowoc has generated substantial cash
flow to fund its business, make acquisitions, pay dividends, and
initiate a stock repurchase program. See Appendix A]
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In thousands, except shares and per share data)
For the years ended July 2, 1994, July 3, 1993 and June 27, 1992
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
COMMON STOCK - SHARES OUTSTANDING
Balance at beginning of year 9,146,501 10,320,847 10,320,847
Treasury stock purchases (1,063,654) (1,174,346) --
------------ ------------ ------------
Balance at end of year 8,082,847 9,146,501 10,320,847
------------ ------------ ------------
COMMON STOCK - PAR VALUE:
Balance at beginning of year $ 109 $ 109 $ 109
------------ ------------ ------------
Balance at end of year $ 109 $ 109 $ 109
------------ ------------ ------------
ADDITIONAL PAID-IN CAPITAL:
Balance at beginning of year $ 31,115 $ 31,115 $ 31,116
Shares forfeited
under stock plan - net -- -- (1)
------------ ------------ ------------
Balance at end of year $ 31,115 $ 31,115 $ 31,115
------------ ------------ ------------
CUMULATIVE FOREIGN CURRENCY
TRANSLATION ADJUSTMENTS:
Balance at beginning of year $ (569) $ 1,399 $ 855
Foreign currency translation
adjustment 159 (1,968) 544
------------ ------------ ------------
Balance at end of year $ (410) $ (569) $ 1,399
------------ ------------ ------------
RETAINED EARNINGS:
Balance at beginning of year $ 129,078 $ 142,737 $ 144,811
Net earnings (loss) 14,043 (3,897) 8,257
Cash dividends, $1.00 per share (8,688) (9,762) (10,331)
------------ ------------ ------------
Balance at end of year $ 134,433 $ 129,078 $ 142,737
------------ ------------ ------------
TREASURY STOCK:
Balance at beginning of year $ (40,297) $ (9,779) $ (9,779)
Treasury stock purchases (31,091) (30,518) --
------------ ------------ ------------
Balance at end of year $ (71,388) $ (40,297) $ (9,779)
<FN>
The accompanying summary of significant accounting policies and notes
to the consolidated financial statements are an integral part of these
statements.
</TABLE>
[GRAPH NO. 9 -- Since beginning a stock buy-back program in
September, 1992, Manitowoc has repurchased 2.2 million shares, thereby
increasing the equity of our remaining shareholders. See Appendix A]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(in thousands)
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the
company and its wholly owned domestic and non-U.S. subsidiaries.
Significant intercompany balances and transactions have been
eliminated.
FISCAL YEAR
The company's fiscal year ends on the Saturday nearest June 30.
In August, 1994, the Board of Directors approved a change in its
fiscal year end to December 31.
INVENTORIES
Inventories are stated at the lower of cost or market as
described in Note 4. Advance payments from customers are netted
against inventories to the extent of related accumulated costs.
Advance payments at July 2, 1994 and July 3, 1993 were $2,063 and
$3,846, respectively. Advance payments received in excess of
related costs on uncompleted contracts are classified as accrued
expenses.
REVENUE RECOGNITION
Revenues and expenses in all three segments are generally
recognized upon shipment. Revenues and costs on contracts for
long-term projects are recognized on the percentage-of-completion
method, commencing when work has progressed to a state where
estimates are reasonably accurate. These estimates are reviewed
and revised periodically throughout the lives of the contracts,
and adjustments to income resulting from such revisions are
recorded in the accounting period in which the revisions are
made. Estimated losses on such contracts are recognized in full
when they are identified. During fiscal 1994 and 1993, there
were no such long-term projects.
FOREIGN CURRENCY TRANSLATION
The financial statements of the company's non-U.S. subsidiaries
are translated in accordance with Statement of Financial
Accounting Standards (SFAS) No. 52. Under SFAS No. 52, asset and
liability accounts are translated at the current exchange rate
and income statement items are translated at the weighted average
exchange rate for the year. Resulting translation adjustments
are recorded directly to a separate component of stockholders'
equity.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is depreciated over the estimated
useful lives of the assets. The company adopted the straight-
line depreciation method for financial statement purposes for all
property acquired after June 29, 1991. Property acquired prior
to June 30, 1991, is depreciated using the sum-of-the-years-
digits method.
INTANGIBLE ASSETS
Costs in excess of net assets of businesses acquired are
amortized on the straight-line basis over their estimated
beneficial lives, not to exceed 40 years. Subsequent to an
acquisition, the company continually evaluates whether later
events and circumstances have occurred that indicate the
remaining estimated useful life of goodwill may warrant revision
or that the remaining balance of goodwill may not be recoverable.
When factors indicate that goodwill should be evaluated for
possible impairment, the company uses an estimate of the related
business's discounted net cash flows over the remaining life of
the goodwill in measuring whether the goodwill is recoverable.
Intangible assets at July 2, 1994 and July 3, 1993 were $4,208
and $2,550, respectively, net of accumulated amortization of
$1,314 and $1,186, respectively.
RESEARCH AND DEVELOPMENT
Research and development costs are charged to expense as incurred
and amount to $2,439, $2,209, and $3,582 in 1994, 1993, and 1992,
respectively.
NET EARNINGS PER COMMON SHARE
Net earnings per common share is based on weighted average shares
outstanding during each year.
STATEMENT OF CASH FLOWS
All short-term investments purchased with an original maturity of
three months or less are considered cash equivalents.
RECLASSIFICATIONS
Certain reclassifications have been made to the financial
statements of prior years to conform to the presentation for
1994.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except shares and per share data)
1
______________________________________________________________________
ACCOUNTING CHANGES
a.Postretirement Benefits - During the third quarter of fiscal
1993, the company adopted Statement of Financial Accounting
Standards (SFAS) No. 106 "Employers' Accounting for Postretirement
Benefits Other Than Pensions", effective June 28, 1992. The
standard requires that the expected cost of postretirement health
care benefits be charged to expense during the years that employees
render service. In applying the pronouncement, the company
recorded a one-time, non-cash, pre-tax charge against earnings as
of the beginning of fiscal year 1993 of $13,073 as a change in
accounting principle. On an after-tax basis, this charge was
$7,974 or $.82 per share.
b.Income Taxes - In the third quarter of 1993, the company adopted
SFAS No. 109 "Accounting for Income Taxes", effective June 28,
1992. Under the liability method prescribed by SFAS 109, deferred
taxes are provided, based upon enacted tax laws and rates
applicable to the periods in which the taxes become payable. The
cumulative effect of adopting the standard was recorded as a change
in accounting principle at the beginning of fiscal 1993, with a
charge to earnings of $2,240 or $.23 per share.
2
____________________________________________________________________
PROPERTY, PLANT AND EQUIPMENT
<TABLE>
<CAPTION>
Property, plant and equipment is summarized as follows:
1994 1993
---- ----
<S> <C> <C>
Land $ 3,812 $ 3,424
Buildings 62,797 64,109
Drydocks and dock fronts 22,040 22,040
Machinery, equipment and tooling 86,816 74,974
Construction in progress 3,546 3,548
-------- --------
Total cost 179,011 168,095
Less accumulated depreciation (115,679) (111,115)
-------- --------
Property, plant and equipment - net $ 63,332 $ 56,980
-------- --------
</TABLE>
3
______________________________________________________________________
MARKETABLE SECURITIES AND LINES OF CREDIT
Marketable securities are stated at cost, which approximates market
value. At July 2, 1994, bank lines of credit aggregating $14,000 were
available to the company. The company has agreed to maintain average
unrestricted compensating balances ranging from 4.5% to 5.0% for each
line. There were no outstanding borrowings against these lines at the
end of any of the years presented.
In May 1993, the Financial Accounting Standards Board issued SFAS No.
115, "Accounting for Certain Investments in Debt and Equity
Securities." SFAS No. 115 sets forth the accounting and reporting for
investments in equity securities that have readily determinable fair
values and for all investments in debt securities.
The company is required to adopt the new accounting and disclosure
rules contained in SFAS No. 115 effective July 3, 1994, as a change in
accounting principle. Based on a preliminary review, the company
expects the adoption of the new standard will not have a material
effect on the company's consolidated results of operations.
4
______________________________________________________________________
INVENTORIES
The components of inventory and their valuation methods are summarized
as follows:
<TABLE>
<CAPTION>
1994 1993
---- ----
<S> <C> <C>
Components:
Raw materials $ 11,275 $ 12,512
Work-in-process 19,463 19,262
Finished goods 20,787 24,887
--------- ---------
Total inventories at FIFO costs 51,525 56,661
Excess of FIFO costs over LIFO value (20,285) (22,461)
--------- ---------
Total inventories $ 31,240 $ 34,200
--------- ---------
</TABLE>
Inventory is carried at lower of cost or market using the first-in,
first-out (FIFO) method for 61% and 47% of total inventory for 1994
and 1993, respectively. The remainder of the inventory is costed
using the last-in, first-out (LIFO) method.
A portion of the inventory represents inventory held for sale or
lease; $249 in 1994 and $937 in 1993. The cost of this inventory is
amortized to cost of sales as a percentage of lease revenue.
Accumulated amortization on such inventory at July 2, 1994, and July
3, 1993, was $18 and $101, respectively.
Inventory quantity reductions during 1994 and 1993 resulted in lower
cost of goods sold computed under the LIFO method due to lower costs
prevailing in prior periods. The increase in net earnings for 1994
and 1993 was $ 1,726 and $1,897, respectively.
5
______________________________________________________________________
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
<TABLE>
<CAPTION>
Accounts payable and accrued expenses are summarized as follows:
1994 1993
---- ----
<S> <C> <C>
Trade accounts payable $ 17,305 $ 22,890
Customer progress payments 4,146 5,666
Vacation accrual 3,137 3,014
Profit sharing 6,576 5,225
Product liability 7,175 4,655
Miscellaneous accrued expenses 15,445 11,434
-------- --------
Total $ 53,784 $ 52,884
-------- --------
</TABLE>
6
______________________________________________________________________
INCOME TAXES
The company changed its method of accounting for income taxes from the
deferred method to the liability method required by SFAS No. 109.
This new standard requires that a deferred tax be recorded to reflect
the tax expense (benefit) resulting from the recognition of temporary
differences. Temporary differences are differences between the tax
basis of assets and liabilities and their reported amounts in the
financial statements. This standard was adopted effective June 28,
1992, using the cumulative catch-up method. At July 2, 1994,
unamortized deferred investment tax credits were $ 699. In addition,
United States income taxes have not been provided on undistributed
earnings of foreign subsidiaries which are considerd to be permanently
invested. At July 2, 1994, the amount of unremitted earnings of the
foreign subsidiaries totaled $11,764.
<TABLE>
<CAPTION>
Components of earnings before income taxes and the cumulative effect
of accounting changes are as follows:
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Earnings before income taxes:
Domestic $ 22,089 $ 8,348 $ 10,027
Foreign 490 581 1,545
-------- -------- --------
Total $ 22,579 $ 8,929 $ 11,572
-------- -------- --------
</TABLE>
<TABLE>
<CAPTION>
Provision (benefit) for taxes on income before the cumulative effect
of accounting changes are as follows:
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Current:
Federal $ 9,138 $ 2,812 $ 2,091
State 2,358 821 220
Foreign 16 428 332
-------- -------- --------
Total current 11,512 4,061 2,643
-------- -------- --------
Deferred:
Federal and state (3,120) (1,138) 484
Foreign 144 (311) 188
-------- -------- --------
Total deferred (2,976) (1,449) 672
-------- -------- --------
Provision for taxes on income $ 8,536 $ 2,612 $ 3,315
-------- -------- --------
</TABLE>
<TABLE>
<CAPTION>
Federal income tax at statutory rates and the provision for income
taxes as reported are reconciled as follows:
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Federal income tax at statutory rate $ 7,903 $ 3,036 $ 3,935
State income taxes, net of federal
income tax benefit 1,140 656 395
Tax-exempt investment income -- (37) (328)
Investment tax credit (96) (144) (189)
Tax-exempt FSC income (515) (355) (230)
Adjustments to prior years'
income tax accruals -- -- (100)
Realization of state net operating and
general business credit carryforwards -- (477) (242)
Other items 104 (67) 74
-------- -------- --------
Provision for taxes on income $ 8,536 $ 2,612 $ 3,315
-------- -------- --------
</TABLE>
The deferred income tax accounts for 1994 and 1993 reflect the impact
of temporary differences between the value of assets and liabilities
for financial reporting purposes and their related value as measured
by the tax laws.
<TABLE>
<CAPTION>
A summary of the deferred tax accounts at July 2, 1994, and July 3,
1993, is as follows:
1994 1993
---- ----
<S> <C> <C>
Current deferred assets:
Differences between book and tax bases of inventories $ 2,068 $ 1,581
Differences between book and tax bases of receivables 291 336
Product warranty reserves 2,183 1,932
Product liability reserves 2,818 1,798
Other employee related benefits and allowances 1,561 1,414
Other reserves and allowances 1,849 1,780
--------- --------
Total current deferred assets $ 10,770 $ 8,841
--------- --------
Non-current deferred assets and (liabilities):
Differences between book and tax bases of fixed assets $ (8,815) $ (8,928)
Postretirement benefits other than pensions in
excess of tax deductions 7,094 6,343
Severance benefits in excess of tax deductions 533 518
Provisions for long-term product warranty reserves 1,225 1,063
Deferred investment tax credit (699) (795)
Other reserves in excess of tax expense (648) (558)
--------- --------
Total non-current deferred assets and (liabilities) (1,310) (2,357)
--------- --------
</TABLE>
The information presented above is in accordance with SFAS No. 109 for
the years ended July 2, 1994 and July 3, 1993. The following table
identifies the deferred tax items which were part of the company's tax
provision for the year ended June 27, 1992:
<TABLE>
<CAPTION>
1992
----
<S> <C>
Deferred DISC income $ (17)
Product warranties (35)
Product liability 97
Depreciation 1,143
Severance costs (331)
Other items (185)
-----
Provision for deferred income taxes $ 672
-----
</TABLE>
7
______________________________________________________________________
ACQUISITIONS
During the third quarter of fiscal 1994, the company acquired the
assets of Femco Machine Co. for $ 10,685 in cash. Femco Machine Co.
is a manufacturer of parts for cranes, draglines, and other heavy
equipment. The acquisition was accounted for under the purchase
method of accounting. The preliminary estimate of the excess of the
cost over the fair value of net assets acquired is $1,659, and is
being amortized over 25 years.
During the third quarter of fiscal 1992, the company acquired the
assets of Merce Industries, Inc. for $2,593 in cash. Merce Industries,
Inc. operates the ship repair facility owned by the Port Authority of
Toledo, Ohio, and had similar operations in Cleveland. The
acquisition has been accounted for as a purchase and, accordingly, the
acquired assets and liabilities have been recorded at their estimated
fair market values as of the date of acquisition. The $1,310 excess
of the purchase price over the valuation of the net assets acquired is
being amortized on a straight-line basis over 40 years.
Femco's and Merce's results of operations subsequent to the date of
acquisition are included in the Consolidated Statements of Earnings.
Pro forma results of operations are not presented as the amounts do
not significantly differ from historical company results.
8
______________________________________________________________________
STOCKHOLDERS' EQUITY
Authorized capitalization consists of 35,000,000 shares of $.01 par
value common stock and 3,500,000 shares of $.01 par value preferred
stock. None of the preferred shares have been issued. Pursuant to a
Rights Agreement dated September 5, 1986, each common share carries
with it a Right to purchase additional stock. The Rights are not
currently exercisable and cannot be separated from the shares unless
certain specified events occur, including the acquisition of 20% or
more of the common stock by a person or group, or the commencement of
a tender offer for 30% or more of the common stock. In the event a
person or group actually acquires 30% or more of the common stock, or
if the company is merged with an acquiring person, each Right permits
the holder to purchase for $45 common stock having a market value of
$90. The Rights expire on September 19, 1996, and may be redeemed by
the company for $.05 per Right (in cash or stock) under certain
circumstances.
On September 8, 1992, the Board of Directors authorized the company to
repurchase up to 1.5 million shares of its common stock. In addition,
on January 11, 1994 and February 1, 1994, the Board of Directors
authorized the repurchase of an additional 500,000 and 1,000,000
shares, respectively. Such repurchases will be in open market or
privately negotiated purchases, as the company may determine from time
to time. As of July 2, 1994, a total of 2,238,000 shares were
purchased pursuant to these authorizations.
9
______________________________________________________________________
RETIREMENT AND HEALTH CARE PLANS
The company provides retirement benefits through noncontributory
deferred profit sharing plans covering substantially all employees.
Company contributions to the plans are based upon formulas contained
in such plans. The company also established, in 1989, a defined
contribution plan in which the company matches 25% of participant
contributions up to a maximum of 5% of a participant's compensation.
Total costs incurred in 1994, 1993, and 1992, were $4,981, $4,896, and
$2,385, respectively.
The company maintains an employee benefit trust through which group
health benefits are funded. Company contributions to the trust were
$4,790 in 1994, $4,450 in 1993, and $5,167 in 1992.
The company also provides certain health care benefits for eligible
retired employees. Substantially all of the company's domestic
employees hired before January 1, 1990, may become eligible for these
benefits if they reach a normal retirement age while working for the
company and satisfy certain years of service requirements.
<TABLE>
<CAPTION>
The components of the 1994 and 1993 periodic postretirement benefit
cost are as follows:
1994 1993
---- ----
<S> <C> <C>
Service cost - benefits earned during the year $ 230 $ 237
Interest cost on accumulated postretirement
benefit obligation 1,279 1,282
------- -------
Net periodic postretirement benefit cost $ 1,509 $ 1,519
------- -------
</TABLE>
<TABLE>
<CAPTION>
The components of the accumulated postretirement benefit obligation at
July 2, 1994, and July 3, 1993, are as follows:
1994 1993
---- ----
<S> <C> <C>
Retirees $ 10,778 $ 11,314
Active participants 6,228 5,863
Unrecognized gain 682 --
-------- --------
Accumulated postretirement
benefit obligation $ 17,688 $ 17,177
-------- --------
</TABLE>
The health care cost trend rate assumed in the determination of the
accumulated postretirement benefit obligation begins at 11% in 1993,
decreases 1% per year to 6% for 1998, and remains at that level
thereafter. Increasing the assumed medical trend rates by one
percentage point in each year would increase the accumulated
postretirement benefit obligation by $2,213 and the aggregate of the
service and interest cost components of net periodic postretirement
benefit cost by $239.
The discount rate used in determining the accumulated postretirement
benefit obligation is 8% compounded annually. The plan is unfunded.
Retiree health care expense under the cash basis was not material in
1992.
10
______________________________________________________________________
LEASES
In February 1992, the company entered into a sale/leaseback
arrangement covering substantially all of its crawler crane and boom
truck crane rental fleets. The initial sale totaled $25,641.
Subsequently, terminations of $10,524, $6,717, and $ 1,774, and sales
of $6,286, $17,940, and $6,254 for 1994, 1993, and 1992, respectively,
were made under this arrangement. The leaseback agreements for the
fleet cover terms of 5 and 7 years and are being accounted for as
operating leases. The gains on the sales of the fleet inventory were
deferred and are being recognized over the term of the leases or at
the time the inventory is otherwise sold to third parties.
The company leases various other property, plant and equipment. Terms
of the leases vary, but generally require the company to pay property
taxes, insurance premiums, and maintenance costs associated with the
leased property.
Rental expense attributable to operating leases, including the
sale/leaseback arrangements, was $7,816 in 1994, $7,480 in 1993, and
$2,635 in 1992. Total minimum rental obligations under noncancellable
operating leases, as of July 2, 1994, aggregated $39,067 and were
payable as follows:
1995.......$ 7,168 1998............$ 4,903
1996.......$ 6,931 1999............$ 3,558
1997.......$ 6,127 Thereafter......$10,380
11
______________________________________________________________________
BUSINESS SEGMENT INFORMATION
The company's business segments operate in both domestic and
international markets. The cranes and related products segment is
tied most closely to energy and infrastructure projects throughout the
world. Foodservice products serve the lodging, restaurant,
healthcare, and convenience store markets, which are impacted by
demographic changes and business cycles. The marine segment provides
repair services to foreign and domestic vessels operating on the Great
Lakes.
Information concerning the company's operations in various businesses
for the three years ended July 2, 1994, is presented on page 12.
Export shipments were approximately $57 million in 1994, $65 million
in 1993, and $40 million in 1992. Foreign sales, operating earnings,
and identifiable assets for 1994 are $14.1 million, $0.2 million, and
$11.8 million, respectively.
12
______________________________________________________________________
CONTINGENCIES
The United States Environmental Protection Agency (EPA) has identified
the company as a potentially responsible party (PRP) under the
Comprehensive Environmental Response Compensation and Liability Act
(CERCLA), liable for the costs associated with investigating and
cleaning up contamination at the Lemberger Landfill Superfund Site
(the Site) near Manitowoc, Wisconsin.
Eleven of the potentially responsible parties have formed a group (the
Lemberger Site Remediation Group, or LSRG) and have successfully
negotiated with EPA and Wisconsin Department of Natural Resources to
settle the potential liability at the Site and fund the cleanup.
Approximately 150 PRP's have been identified as having shipped
substances to the Site.
Recent estimates indicate that the total cost to clean up the Site
could be as high as $25 million, however, the ultimate remediation
methods and appropriate allocation of costs for the Site are not yet
final.
Although liability is joint and several, the company's percentage
share of liability is estimated to be 5% of the total cleanup costs,
but could increase to 15% if no participation agreements are made
between the LSRG and any other PRP's.
In connection with this matter, the company expensed $1.6 million,
$0.5 million, and $0.9 million in 1994, 1993, and 1992, respectively,
for its estimated portion of the cleanup costs. In addition, the
company has notified its insurance carrier requesting reimbursement of
incurred and future costs at the Site. Settlement of this claim is
uncertain; a recent Wisconsin Supreme Court decision did not require
an insurer to pay similar costs. Any recoveries from the insurance
carrier will be recognized when received.
The company is involved in various other legal actions arising in the
normal course of business. After taking into consideration legal
counsel's evaluation of such actions, in the opinion of management,
ultimate resolution is not expected to have a material adverse effect
on the consolidated financial statements.
As of July 2, 1994, 35 product related lawsuits were pending. Of
these, 13 occurred between 1985 and 1990 when the company was
completely self-insured. The remaining lawsuits occurred subsequent
to June 1, 1990, at which time the Company has insurance coverages
ranging from a $5.5 million self-insured retention with a $10.0
million limit on the insurer's contribution in 1990, to the current
$1.0 million self-insured retention and $16.0 million limit.
Product liability reserves at July 2, 1994 are $7.2 million; $3.9
million reserved specifically for the 35 cases referenced above, and
$3.3 million for incurred but not reported claims. These reserves
were estimated using actuarial methods. The highest current reserve
for a non-insured claim is $.4 million, and $.9 million for an
insured claim. Based on the company's experience in defending itself
against product liability claims, management believes the current
reserves are adequate for estimated settlements on aggregate self-
insured claims.
MANAGEMENT'S REPORT ON CONSOLIDATED FINANCIAL STATEMENTS
Company management is responsible for the integrity of this annual
report's financial statements. Those statements were prepared in
accordance with general accepted accounting principles. Where
necessary, amounts are based on judgments and estimates by management.
All financial information in this report matches the financial
statements.
The company maintains an internal accounting system designed to
provide reasonable assurance that assets are safeguarded and that
books and records reflect only authorized transactions.
To further safeguard assets, the company has established an Audit
Committee composed of directors who are neither officers nor employees
of the company. The Audit Committee is responsible for reviewing the
company's financial reports and accounting practices. The Audit
Committee meets periodically with the company's independent
accountants.
The company's independent accountants provide an objective examination
of the company's financial statements. They evaluate the company's
system of internal controls and perform tests and other procedures
necessary to express an opinion on the fairness of the presentation of
the consolidated financial statements.
/s/ Fred M. Butler /s/ Robert R. Friedl
----------------------------------- --------------------------
President & Chief Executive Officer Chief Financial Officer
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
- - ----------------------------------------
To The Manitowoc Company, Inc.:
We have audited the accompanying consolidated balance sheets of The
Manitowoc Company, Inc. (a Wisconsin corporation) as of July 2, 1994
and July 3, 1993, and the related consolidated statements of earnings,
stockholders' equity, and cash flows for each of the three fiscal
years in the period ended July 2, 1994. These financial statements
are the responsibility of the company's management. Our
responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly in all material respects, the financial position of The
Manitowoc Company, Inc. as of July 2, 1994 and July 3, 1993, and the
results of operations and its cash flows for each of the three fiscal
years in the period ended July 2, 1994, in conformity with generally
accepted accounting principles.
As explained in Note 1 to the Consolidated Financial Statements,
effective June 28, 1992, the company changed its method of accounting
for retiree health care benefits and income taxes.
/s/ Arthur Andersen LLP
- - ---------------------------------
Milwaukee, Wisconsin
July 28, 1994
OTHER SHAREHOLDER INFORMATION
Independent Public Accountants
- - ------------------------------
Arthur Andersen LLP
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Stock Transfer Agent & Registrar
- - --------------------------------
First Chicago Trust Company of New York
P. O. Box 2500
Jersey City, New Jersey 07303-2500
Annual Meeting
- - --------------
The annual meeting of Manitowoc shareholders will be held at 9:00 a.m.
CST, Tuesday, November 1, 1994, in the office area at the company's
South Works facility, 2401 South 30th Street, Manitowoc, Wisconsin.
We encourage shareholders to participate in this meeting in person or
by proxy.
Stock Listing
- - -------------
Manitowoc's common stock is traded on the New York Stock Exchange and
is identified by the ticker symbol MTW. Current trading volume, share
price, dividends, and related information can be found in the
financial section of most daily newspapers.
Quarterly common stock price information for our three most recent
fiscal years can be found on page 1 of this annual report.
Manitowoc Shareholders
- - ----------------------
At the end of fiscal 1994, 8,082,847 shares of Manitowoc common stock
were outstanding. At such date, there were approximately 2,400
shareholders of record.
Although the majority of Manitowoc shareholders reside in Wisconsin,
other shareholders reside throughout the United States, Canada,
Mexico, and several overseas locations.
Form 10-K Report
- - ----------------
Each year, Manitowoc files its Annual Report on Form 10-K with the
Securities and Exchange Commission. Most of the financial information
contained in that report is included in this annual Report to
Shareholders.
A copy of Form 10-K, as filed with the Securities and Exchange
Commission for fiscal 1994, may be obtained by any shareholder,
without charge, upon written request to:
E. Dean Flynn
Secretary
The Manitowoc Company, Inc.
700 East Magnolia Avenue, Suite B
P. O. Box 66
Manitowoc, Wisconsin 54221-0066
Dividends
- - ---------
Common stock dividends are usually considered in conjunction with
quarterly meetings of Manitowoc's board of directors.
Dividend Reinvestment and Stock Purchase Plan
- - ---------------------------------------------
The Dividend Reinvestment and Stock Purchase Plan provides a
convenient method to acquire additional shares of Manitowoc stock
through the investment of quarterly dividends. Shareholders may also
purchase shares by investing cash as often as once a month in varying
amounts from $10 up to a maximum of $60,000 each calendar year.
Participation is voluntary, and all fees associated with stock
purchases under these plans are paid for by Manitowoc.
To receive an information booklet and enrollment form, please contact
First Chicago Trust Company of New York at the address listed at far
left.
<TABLE>
<CAPTION>
SUPPLEMENTAL QUARTERLY FINANCIAL INFORMATION (Unaudited)
The table below presents quarterly data for fiscal years 1994 and 1993
(In thousands, except per share data)
1994 1993
----------------------------------------- ---------------------------------------
First Second Third Fourth First Second Third Fourth
------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales $ 61,056 $ 67,772 $ 60,606 $ 85,946 $ 61,825 $ 53,292 $ 62,868 $100,573
Gross margin 16,776 15,681 14,405 21,062 16,310 9,009 5,243 25,223
Earnings (loss) before
cumulative effect of
accounting changes 4,088 3,088 1,600 5,267 3,851 (924) (4,772) 8,162
Net earnings (loss) 4,088 3,088 1,600 5,267 (6,363) (924) (4,772) 8,162
Per common share:
Earnings (loss) before
cumulative effect of
accounting changes .45 .35 .19 .64 .37 (.07) (.49) .84
Net earnings (loss) .45 .35 .19 .64 (.62) (.11) (.49) .84
Dividends .25 .25 .25 .25 .25 .25 .25 .25
</TABLE>
EXHIBIT 13
1994 10-K
EXHIBIT 13 - APPENDIX A
Cross Reference or
Graph No. Description of Graph Narrative Discussion
- - --------- -------------------- ---------------------
1 Bar Graph of Consolidated
Operating Earnings for 1990-1994 See "Eleven-Year Record"
2 Bar Graph of Consolidated
Gross Margins for 1990-1994 See "Eleven-Year Record"
3 Bar Graph of Consolidated Graph shows export shipments
Export Shipments for 1990-1994 of $28 million, $42 million,
$40 million, $65 million,
and $57 million for 1990,
1991, 1992, 1993, and 1994,
respectively.
4 Bar Graph of Total Identifiable
Assets for 1990-1994 See "Eleven-Year Record"
5 Bar Graph of Consolidated Net
Sales for 1990-1994 See "Eleven-Year Record"
6 Bar Graph of Consolidated Graph shows that inventories
Inventories for 1990-1994 rose from $76.3 million in
1990, to a high of $84.3
million in 1991 and have
steadily declined (1992 -
$64.5 million, 1993 -
$34.2 million) to the
current level of $31.2 million
in 1994.
7 Bar Graph of Consolidated Net
Earnings for 1990-1994 See "Eleven-Year Record"
8 Bar Graph of Net Cash Provided See "Consolidated Statements
for 1990-1994 of Cash Flows" for fiscal
years 1992-1994. The net cash
provided by operations for
fiscal years 1990 and 1991 is
$14.2 million and $6.5
million, respectively.
9 Bar Graph of Share of Common See "Consolidated Statements
Stock Outstanding for 1990-1994 of Stockholders' Equity" for
fiscal years 1992-1994. The
shares of Common Stock
outstanding is $10.3 million
for fiscal years 1990 and
1991.
EXHIBIT 21
1994 10-K
LIST OF SUBSIDIARIES
JURISDICTION
SUBSIDIARY OF INCORPORATION
-------------- ------------------
Manitex, Inc. Texas
Manitowoc International Sales Corp. Barbados
Manitowoc Nevada, Inc. Nevada
Manitowoc Re-Manufacturing, Inc. Wisconsin
Manitowoc Europe B.V. The Netherlands
Manitowoc A.G. Switzerland
Manitowoc Europe Limited England
Manitowoc-Forsythe Corp. New York
Manitowoc Western Company, Inc. Wisconsin
North Central Crane & Excavator Sales Corp. Nevada
EXHIBIT 23
1994 10-K
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation of our reports included (or incorporated by reference)
in this Form 10-K, into the Company's previously filed Registration
Statements on Form S-8 (File Nos. 33-65316 and 33-48665).
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin
September 26, 1994.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the
Manitowoc Company, Inc.'s consolidated financial statements at or for the
year ended July 2, 1994 and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUL-02-1994
<PERIOD-END> JUL-02-1994
<CASH> 15094
<SECURITIES> 15008
<RECEIVABLES> 43366
<ALLOWANCES> 777
<INVENTORY> 31240
<CURRENT-ASSETS> 117657
<PP&E> 179011
<DEPRECIATION> 115679
<TOTAL-ASSETS> 185848
<CURRENT-LIABILITIES> 63610
<BONDS> 0
<COMMON> 109
0
0
<OTHER-SE> 93750
<TOTAL-LIABILITY-AND-EQUITY> 185848
<SALES> 275380
<TOTAL-REVENUES> 275380
<CGS> 207456
<TOTAL-COSTS> 254295
<OTHER-EXPENSES> 203
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 22579
<INCOME-TAX> 8536
<INCOME-CONTINUING> 14043
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 14043
<EPS-PRIMARY> 1.61
<EPS-DILUTED> 1.61
</TABLE>
