<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
-----------------------
Date of Report
(Date of earliest
event reported): February 6, 1998
Oshkosh Truck Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 0-13886 39-0520270
- --------- ------- ----------
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
P. O. Box 2566, Oshkosh, Wisconsin 54903-2556
-----------------------------------------------------------
(Address of principal executive offices, including zip code)
(414) 235-9151
(Registrant's telephone number)
<PAGE> 2
Item 5. Other Events.
As previously disclosed, on December 8, 1997, Oshkosh Truck
Corporation (the "Company") agreed to acquire McNeilus Companies, Inc.
("McNeilus"), a $300 million manufacturer and marketer of refuse truck bodies,
rear-discharge concrete mixers and ready-mix batch plants (the "Acquisition").
The Acquisition is expected to close in the first quarter of calendar 1998.
Under certain conditions, if the Acquisition is not consummated, the Company
may be required to pay McNeilus a fee of $10.0 million, and conversely,
McNeilus may be required to pay a $10.0 million fee to the Company.
The total purchase cost for all McNeilus stock and related
non-compete and ancillary agreements is $250.0 million and is intended to be
financed through the issuance of $100.0 million senior subordinated notes and a
$325.0 million senior debt facility inclusive of a $100 million revolver and
senior notes of $100.0 million, $62.5 million and $62.5 million with terms of
six, seven and eight years, respectively. The Company is in the process of
attempting to arrange this financing. Certain pro forma financial information
for the Company, which gives effect to the Acquisition and related financing
transactions, is included as an exhibit to this filing.
Item 7. Financial Statements and Exhibits.
(b) Exhibits.
The exhibit listed in the accompanying Exhibit Index is filed
as part of this Current Report on Form 8-K.
-2-
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
OSHKOSH TRUCK CORPORATION
Date: February 6, 1998 By: /s/ Charles L. Szews
-------------------------------
Charles L. Szews
Executive Vice President and Chief
Financial Officer
-3-
<PAGE> 4
OSHKOSH TRUCK CORPORATION
EXHIBIT INDEX TO FORM 8-K
Dated February 5, 1998
Exhibit
No. Description
- ------- -----------
(99) Unaudited Pro Forma Condensed Consolidated Financial
Statements of Oshkosh Truck Corporation and McNeilus
Companies, Inc.
-4-
<PAGE> 1
EXHIBIT (99)
INDEX TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
OSHKOSH TRUCK CORPORATION AND MCNEILUS COMPANIES, INC.
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Unaudited Pro Forma Condensed Consolidated Balance Sheet as
of December 31, 1997...................................... P-3
Unaudited Pro Forma Condensed Consolidated Statement of
Income for the twelve months ended December 31, 1997...... P-4
Unaudited Pro Forma Condensed Consolidated Statement of
Income for the fiscal year ended September 30, 1997....... P-5
Unaudited Pro Forma Condensed Consolidated Statement of
Income for the three months ended December 31, 1997....... P-6
Notes to Unaudited Pro Forma Condensed Consolidated
Financial Statements...................................... P-7
</TABLE>
P-1
<PAGE> 2
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma condensed consolidated statements of
income and condensed consolidated balance sheet (collectively, the "Pro Forma
Statements") have been derived by the application of pro forma adjustments,
which give effect to the pending acquisition by Oshkosh Truck Corporation
("Oshkosh") of all of the issued and outstanding common stock of McNeilus
Companies, Inc. ("McNeilus") (the "Acquisition"), the proposed issuance by
Oshkosh of $100 million Senior Subordinated Notes (the "Debt Issuance"), the
consummation of a proposed $325 million Senior Credit Facility ("Senior Credit
Facility"), the prepayment of outstanding term loans and borrowings under a
revolving credit facility (the "Debt Repayment") and the proposed establishment
of a lease financing partnership (the "Lease Financing") (collectively referred
to as the "Transactions"), to historical financial statements of Oshkosh and
McNeilus as if the Transactions had been consummated for balance sheet purposes
as of December 31, 1997, and for statement of income purposes as of the
beginning of the periods presented. For purposes of the Pro Forma Statements,
the Transactions are assumed to occur simultaneously. There can be no assurance
that the Transactions will be consummated.
THE PRO FORMA STATEMENTS DO NOT PURPORT TO REPRESENT WHAT OSHKOSH'S
FINANCIAL POSITION OR RESULTS OF OPERATIONS WOULD ACTUALLY HAVE BEEN HAD THE
TRANSACTIONS IN FACT OCCURRED ON THE ASSUMED DATES OR TO PROJECT OSHKOSH'S
FINANCIAL POSITION OR RESULTS OF OPERATIONS FOR ANY FUTURE DATE OR FUTURE
PERIOD. THE PRO FORMA STATEMENTS SHOULD BE READ IN CONJUNCTION WITH THE
HISTORICAL FINANCIAL STATEMENTS AND RELATED NOTES OF OSHKOSH.
The pro forma adjustments, as described in the accompanying notes to the
Pro Forma Statements, are based on available information and certain assumptions
that management believes are reasonable.
The Acquisition will be accounted for under the purchase method of
accounting. The purchase price for McNeilus has been allocated to the tangible
and intangible assets and liabilities of McNeilus based on preliminary estimates
of their fair values. The allocation of the purchase price is subject to
revision when additional information concerning certain asset and liability
valuations is obtained.
Oshkosh and McNeilus have different fiscal year ends -- September 30 for
Oshkosh and the last day of February for McNeilus -- and as a result, amounts
for McNeilus as of November 30, 1997 have been combined with amounts of Oshkosh
as of December 31, 1997 for the Unaudited Pro Forma Condensed Consolidated
Balance Sheet. The unaudited condensed consolidated statement of income for
Oshkosh for the twelve month period ended September 30, 1997 and for the twelve
month period ended December 31, 1997 have been combined with the unaudited
condensed consolidated statement of income for McNeilus for the twelve month
period ended November 30, 1997. The unaudited condensed consolidated statement
of income of Oshkosh for the three months ended December 31, 1997 has been
combined with the unaudited condensed consolidated statement of income for
McNeilus for the three months ended November 30, 1997. Statement of income
information of McNeilus for the three month period ended November 30, 1997 is
therefore included in both the interim and the annual Pro Forma Statements.
The application of the pro forma adjustments to the historical results of
operations of Oshkosh for the twelve months ended December 31, 1997 and
September 30, 1997, results in the pro forma income from continuing operations
being greater than the historical income from continuing operations of Oshkosh.
Net sales of Oshkosh for the first quarter of each fiscal year (the three months
ended December 31) and net sales of McNeilus for the third quarter of each
fiscal year (the three months ended November 30) represent the lowest quarter of
shipments for each company during their respective fiscal years. Accordingly,
the application of the pro forma adjustments to the historical results of
operations of Oshkosh for the three months ended December 31, 1997, results in
the pro forma income from continuing operations being less than the historical
income from continuing operations of Oshkosh.
P-2
<PAGE> 3
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(IN THOUSANDS)
<TABLE>
<CAPTION>
PRO FORMA
ADJUSTMENTS
---------------------------
AS REPORTED DEBT ISSUANCE,
------------------------------------- DEBT REPAYMENT,
OSHKOSH MCNEILUS ACQUISITION AND PRO FORMA
DECEMBER 31, 1997 NOVEMBER 30, 1997 LEASE FINANCING VALUATION CONSOLIDATED
----------------- ----------------- --------------- --------- ------------
(A) (B)
<S> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents.............. $ 198 $ 20,159 $(17,659) $ -- $ 2,698
Receivables, net........... 54,215 12,259 -- -- 66,474
Net investment in
sales-type leases........ -- 35,108 (35,108) -- --
Inventories................ 86,744 59,189 -- 7,868 153,801
Prepaid expenses and
other.................... 3,905 7,535 -- -- 11,440
Deferred income taxes...... 9,169 4,213 -- -- 13,382
-------- -------- -------- --------- --------
Total current
assets.............. 154,231 138,463 (52,767) 7,868 247,795
Net assets of discontinued
operations................. -- 6,988 (2,840) (4,148) --
Investment in unconsolidated
partnership................ -- -- 8,005 -- 8,005
Net investment in sales-type
leases..................... -- 86,536 (86,536) -- --
Other long-term assets....... 8,248 14,513 (4,699) (1,000) 17,062
Property, plant and
equipment, net............. 55,340 27,896 (400) 7,500 90,336
Purchase cost................ -- -- 256,000 (256,000) --
Goodwill and other
intangibles, net........... 163,639 324 -- 169,829 333,792
-------- -------- -------- --------- --------
Total assets................. $381,458 $274,720 $116,763 $ (75,951) $696,990
======== ======== ======== ========= ========
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Accounts payable........... $ 40,556 $ 10,324 $ -- $ -- $ 50,880
Floor plan notes payable... -- 17,194 -- -- 17,194
Customer advances.......... 35,261 -- -- -- 35,261
Other current
liabilities.............. 41,342 17,042 (483) -- 57,901
Current maturities of
senior term loans,
revolving credit facility
and other long-term
debt..................... 7,820 36,073 (32,357) -- 11,536
-------- -------- -------- --------- --------
Total current
liabilities......... 124,979 80,633 (32,840) -- 172,772
Senior revolving credit
facility................... -- -- 13,048 -- 13,048
Senior term loans............ -- -- 213,750 -- 213,750
Senior subordinated notes.... -- -- 100,000 -- 100,000
Other long-term debt......... 95,000 80,450 (172,852) -- 2,598
Other long-term
liabilities................ 15,031 -- -- -- 15,031
Deferred income taxes........ 22,701 23,079 (3,588) 14,607 56,799
Total shareholders' equity... 123,747 90,558 (755) (90,558) 122,992
-------- -------- -------- --------- --------
Total liabilities and
shareholders' equity....... $381,458 $274,720 $116,763 $ (75,951) $696,990
======== ======== ======== ========= ========
</TABLE>
See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements.
P-3
<PAGE> 4
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA
------------------------------------- -----------------
OSHKOSH MCNEILUS TWELVE MONTHS
TWELVE MONTHS TWELVE MONTHS ENDED
ENDED ENDED PRO FORMA DECEMBER 31, 1997
DECEMBER 31, 1997 NOVEMBER 30, 1997 ADJUSTMENTS CONSOLIDATED
----------------- ----------------- ----------- -----------------
<S> <C> <C> <C> <C>
Net sales....................... $684,715 $326,552 $ -- $1,011,267
-- -- (699)(h) --
(1,048)(g)
Cost of sales................... 593,147 268,923 1,764 (c) 862,087
-------- -------- -------- ----------
Gross income............. 91,568 57,629 (17) 149,180
Operating expenses:
Selling, general and
administrative............. 49,393 30,083 (1,461)(c) 76,172
-- -- (1,843)(g) --
Engineering, research and
development................ 7,997 -- 699 (h) 8,696
Amortization of goodwill and
intangibles................ 4,464 -- 6,642 (d) 11,106
-------- -------- -------- ----------
Total operating
expenses.............. 61,854 30,083 (k) 4,037 95,974 (k)
-------- -------- -------- ----------
Income from operations.......... 29,714 27,546 (4,054) 53,206
Other income (expense):
Interest expense.............. (11,668) (11,562) 9,846 (e) (30,943)
-- -- (17,559)(f) --
Interest income............... 676 12,382 (12,382)(e) 676
-- -- (609)(e) --
Other -- net.................. (197) 2,581 (1,765)(i) 10
-------- -------- -------- ----------
(11,189) 3,401 (22,469) (30,257)
-------- -------- -------- ----------
Income from continuing
operations before income taxes
and equity in income of
unconsolidated partnership.... 18,525 30,947 (26,523) 22,949
Provision (credit) for income
taxes......................... 7,003 11,330 (9,284)(j) 9,049
-------- -------- -------- ----------
11,522 19,617 (17,239) 13,900
Equity in income of
unconsolidated partnership
(net of income taxes of
$1,227)....................... -- -- 1,918 (e) 1,918
-------- -------- -------- ----------
Income from continuing
operations.................... $ 11,522 $ 19,617 $(15,321) $ 15,818
======== ======== ======== ==========
Earnings per common share from
continuing operations:
Basic......................... $ 1.37 $ 1.88
======== ==========
Diluted....................... $ 1.36 $ 1.86
======== ==========
Shares used in calculation:
Basic......................... 8,425 8,425
======== ==========
Diluted....................... 8,485 8,485
======== ==========
</TABLE>
See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements.
P-4
<PAGE> 5
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA
------------------------------------- -----------------
OSHKOSH TWELVE MONTHS
FISCAL YEAR MCNEILUS ENDED
ENDED TWELVE MONTHS SEPTEMBER 30,
SEPTEMBER 30, ENDED PRO FORMA 1997
1997 NOVEMBER 30, 1997 ADJUSTMENTS CONSOLIDATED
------------- ----------------- ----------- -------------
<S> <C> <C> <C> <C>
Net sales....................... $683,234 $326,552 $ -- $1,009,786
-- -- (699)(h) --
(1,048)(g)
Cost of sales................... 594,390 268,923 1,764 (c) 863,330
-------- -------- -------- ----------
Gross income............. 88,844 57,629 (17) 146,456
Operating expenses:
Selling, general and
administrative............. 47,742 30,083 (1,461)(c) 74,521
-- -- (1,843)(g) --
Engineering, research and
development................ 7,847 -- 699 (h) 8,546
Amortization of goodwill and
intangibles................ 4,470 -- 6,642 (d) 11,112
-------- -------- -------- ----------
Total operating
expenses.............. 60,059 30,083(k) 4,037 94,179 (k)
-------- -------- -------- ----------
Income from operations.......... 28,785 27,546 (4,054) 52,277
Other income (expense):
Interest expense.............. (12,722) (11,562) 9,846 (e) (30,947)
-- -- (16,509)(f) --
Interest income............... 717 12,382 (12,382)(e) 717
-- -- (609)(e) --
Other -- net.................. (278) 2,581 (1,765)(i) (71)
-------- -------- -------- ----------
(12,283) 3,401 (21,419) (30,301)
-------- -------- -------- ----------
Income from continuing
operations before income taxes
and equity in income of
unconsolidated partnership.... 16,502 30,947 (25,473) 21,976
Provision for income taxes...... 6,496 11,330 (8,874)(j) 8,952
-------- -------- -------- ----------
10,006 19,617 (16,599) 13,024
Equity in income of
unconsolidated partnership
(net of income taxes of
$1,227)....................... -- -- 1,918 (e) 1,918
-------- -------- -------- ----------
Income from continuing
operations.................... $ 10,006 $ 19,617 $(14,681) $ 14,942
======== ======== ======== ==========
Earnings per common share from
continuing operations:
Basic......................... $ 1.18 $ 1.76
======== ==========
Diluted....................... $ 1.17 $ 1.75
======== ==========
Shares used in calculation:
Basic......................... 8,502 8,502
======== ==========
Diluted....................... 8,546 8,546
======== ==========
</TABLE>
See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements.
P-5
<PAGE> 6
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
AS REPORTED
---------------------------
OSHKOSH MCNEILUS PRO FORMA
------------ ------------ ------------------
THREE MONTHS ENDED THREE MONTHS
--------------------------- ENDED
DECEMBER 31, NOVEMBER 30, PRO FORMA DECEMBER 31, 1997
1997 1997 ADJUSTMENTS CONSOLIDATED
------------ ------------ ------------ ------------------
<S> <C> <C> <C> <C>
Net sales.......................... $151,801 $67,295 $ -- $219,096
-- -- (114)(h) --
(166)(g)
Cost of sales...................... 129,494 55,419 472 (c) 185,105
-------- ------- ------- --------
Gross income.................. 22,307 11,876 (192) 33,991
Operating expenses:
Selling, general and
administrative................ 11,676 7,847 (380)(c) 18,883
-- -- (260)(g) --
Engineering, research and
development................... 2,143 -- 114 (h) 2,257
Amortization of goodwill and
intangibles................... 1,126 -- 1,660 (d) 2,786
-------- ------- ------- --------
Total operating expenses.... 14,945 7,847(k) 1,134 23,926(k)
-------- ------- ------- --------
Income from operations............. 7,362 4,029 (1,326) 10,065
Other income (expense):
Interest expense.............. (2,504) (2,500) 2,364 (e) (7,618)
-- -- (4,978)(f) --
Interest income.......... 165 2,955 (2,955)(e) 165
-- -- (149)(e) --
Other -- net............. 72 682 (356)(i) 249
-------- ------- ------- --------
(2,267) 1,137 (6,074) (7,204)
-------- ------- ------- --------
Income from continuing operations
before income taxes and equity
in income of unconsolidated
partnership................... 5,095 5,166 (7,400) 2,861
Provision for income taxes....... 1,955 1,891 (2,621)(h) 1,225
-------- ------- ------- --------
3,140 3,275 (4,779) 1,636
Equity in income of
unconsolidated partnership
(net of income taxes of
$289)......................... -- -- 451 (e) 451
-------- ------- ------- --------
Income from continuing
operations.................... $ 3,140 $ 3,275 $(4,328) $ 2,087
======== ======= ======= ========
Earnings per common share from
continuing operations:
Basic......................... $0.38 $0.25
======== ========
Diluted....................... $0.37 $0.25
======== ========
Shares used in calculation:
Basic......................... 8,341 8,341
======== ========
Diluted....................... 8,437 8,437
======== ========
</TABLE>
See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements.
P-6
<PAGE> 7
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
(IN THOUSANDS)
(a) Pro forma adjustments related to the Debt Issuance, the Debt Repayment,
the Acquisition and the Lease Financing are summarized in the following table:
<TABLE>
<CAPTION>
DEBT ISSUANCE
AND DEBT LEASE
FEES REPAYMENT ACQUISITION FINANCING TOTALS
---- ------------- ----------- --------- ------
(1) (2) (3) (4)
<S> <C> <C> <C> <C> <C>
Cash and cash equivalents.............. $(15,424) $ 235,228 $(233,875) $ (3,588) $ (17,659)
Net investment in sales-type leases.... -- -- -- (35,108) (35,108)
Net assets of discontinued
operations........................... -- -- (2,840) -- (2,840)
Investment in unconsolidated
partnership.......................... -- -- -- 8,005 8,005
Net investment in sales-type leases --
long-term............................ -- -- -- (86,536) (86,536)
Other long-term assets................. 9,424 (1,238) (12,885) -- (4,699)
Property, plant and equipment, net..... -- -- (400) -- (400)
Purchase cost.......................... 6,000 -- 250,000 -- 256,000
Other current liabilities.............. -- (483) -- -- (483)
Current maturities of long-term debt... -- 3,430 -- (35,787) (32,357)
Senior revolving credit facility....... -- 13,048 -- -- 13,048
Senior term loans -- less current
portion.............................. -- 213,750 -- -- 213,750
Senior subordinated notes payable...... -- 100,000 -- -- 100,000
Long-term debt......................... -- (95,000) -- (77,852) (172,852)
Deferred income taxes -- long-term..... -- -- (3,588) (3,588)
Shareholders' equity................... -- (755) -- -- (755)
</TABLE>
- -------------------------
(1) Fees and expenses totaling $16,000 for legal, financial and other
professional fees due at closing associated with the Senior Credit Facility
and the Debt Issuance ($8,500), the Acquisition ($6,000) and the Lease
Financing ($1,500), less $576 prepaid at December 31, 1997.
(2) Issuance of aggregate debt of $338,048, repayment of existing long-term debt
of $95,000 and borrowings under the revolving credit facility of $7,820 and
write-off of deferred debt issuance costs of $1,238, less tax benefit of
$483, or $755.
(3) Aggregate cash purchase price of $250,000 due at closing less transactions
prior to or concurrent with closing, including $16,025 in cash to be
received from McNeilus shareholders (repayment of notes of $10,592, sale of
certain assets of $4,094 and intercompany payments of $1,339), and $100
received from third parties from the sale of a discontinued operation.
(4) To reflect contribution of the net investment in sales-type leases to the
unconsolidated lease financing partnership and recognition of gain for
income tax purposes on these sales-type leases which was previously deferred
for income tax purposes. It is anticipated that each general partner will
participate equally in the principal operating and financial decision making
activities of the lease financing partnership.
P-7
<PAGE> 8
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)
(b) The Acquisition will be accounted for by Oshkosh using the purchase
method of accounting. The total purchase cost will be allocated first to the
assets and liabilities of McNeilus based upon their respective fair values with
the remainder allocated to costs in excess of net assets acquired. The
historical shareholders' equity of McNeilus will be eliminated. The aggregate
purchase cost and the preliminary allocation of the purchase cost to the assets
and liabilities of McNeilus are as follows:
<TABLE>
<S> <C>
Purchase cost, including related fees:
Acquisition of 100% of the issued and outstanding common
stock of McNeilus...................................... $250,000
Fees and expenses incurred in connection with the
Acquisition............................................ 6,000
--------
Total acquisition cost............................ $256,000
========
Preliminary allocation of acquisition cost(1):
Net assets acquired at historical cost.................... $ 90,558
Add (deduct):
Permitted pre-close dividend to shareholders of certain
discontinued operations................................ (4,148)
Revaluation of McNeilus property, plant and equipment,
inventories and investment in foreign subsidiaries to
estimated fair values.................................. 14,368
Valuation of identified intangible assets:
Non-compete agreements................................. 38,000
Other.................................................. 23,085
Deferred income tax provision associated with the
revaluation of McNeilus assets and liabilities......... (14,607)
Cost in excess of net assets acquired..................... 108,744
--------
Total purchase cost............................... $256,000
========
</TABLE>
- -------------------------
(1) The allocation of the purchase cost reflects the revaluation of McNeilus'
assets and liabilities to their estimated fair values based on preliminary
estimates. The preliminary allocation may differ from the final allocation.
(c) Adjustment to reflect depreciation expense based on the new basis and
remaining economic useful lives of McNeilus property, plant and equipment. New
basis depreciation is computed using the straight line method over the remaining
useful lives.
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED THREE MONTHS ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1997
------------------------- -------------------------
SELLING, SELLING,
COST OF GENERAL AND COST OF GENERAL AND
SALES ADMINISTRATIVE SALES ADMINISTRATIVE
------- -------------- ------- --------------
<S> <C> <C> <C> <C>
Eliminate historical depreciation.................. $(1,020) $(2,835) $(224) $(723)
New basis depreciation............................. 2,784 1,374 696 343
------- ------- ----- -----
$ 1,764 $(1,461) $ 472 $(380)
======= ======= ===== =====
</TABLE>
P-8
<PAGE> 9
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)
(d) Adjustment to record the amortization of goodwill and other intangible
assets over the indicated periods.
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED THREE MONTHS ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1997
------------------- ------------------
<S> <C> <C> <C>
Non-compete agreements(1)..... 10-15 yrs $2,633 $ 658
Other(2)...................... 5-30 yrs 1,290 322
Goodwill(2)................... 40 yrs 2,719 680
------- -------
$6,642 $1,660
======= =======
</TABLE>
- -------------------------
(1) Amortized over the terms of the respective agreements on the straight-line
method.
(2) Amortized over the estimated useful lives on a straight-line method.
(e) Reclassify interest income, interest expense and gain on sale of leased
equipment of the leasing operation to "Equity in Income of Unconsolidated
Partnership" to reflect the contribution of sales-type leases from McNeilus to
the Lease Financing Partnership and to record amortization of costs to establish
the lease financing partnership.
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED THREE MONTHS ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1997
------------------- ------------------
<S> <C> <C>
Interest income-leasing................... $12,382 $ 2,955
Interest expense-leasing.................. (9,846) (2,364)
Gains on sales of leased equipment........ 609 149
------- -------
3,145 740
Income taxes at 39%....................... (1,227) (289)
------- -------
$ 1,918 $ 451
======= =======
</TABLE>
P-9
<PAGE> 10
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)
(f) Adjustment to record interest expense and amortization of deferred debt
issuance cost on the debt incurred to finance the Acquisition and repayment of
certain existing indebtedness of Oshkosh, based upon pro forma consolidated debt
of Oshkosh following consummation of the Transactions using the interest rates
as shown (as if the Transactions had been consummated as of the beginning of the
periods presented):
<TABLE>
<CAPTION>
TWELVE MONTHS TWELVE MONTHS THREE MONTHS
ENDED ENDED ENDED
INTEREST DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
RATE 1997 1997 1997
-------- ------------- ------------- ------------
<S> <C> <C> <C> <C>
Eliminate historical expense:
Interest on debt repaid..................... $(11,243) $(12,293) $(2,227)
Amortization of debt issuance costs......... (216) (218) (54)
Financing fees and other expenses........... (207) (205) (48)
-------- -------- -------
Total historical expense.................... (11,666) (12,716) (2,329)
Interest on new debt:(1)(3)
Revolving Credit Facility................... 7.625% 995 995 249
$100,000 Senior Subordinated Notes.......... 9.000% 9,000 9,000 2,250
$100,000 Term A............................. 7.625% 7,625 7,625 1,906
$62,500 Term B.............................. 7.875% 4,922 4,922 1,230
$62,500 Term C.............................. 8.125% 5,078 5,078 1,270
-------- -------- -------
27,620 27,620 6,905
Amortization of debt issuance costs(2)...... 1,226 1,226 307
Financing fees and other expenses........... 379 379 95
-------- -------- -------
Total interest on new debt.......... 29,225 29,225 7,307
-------- -------- -------
Net adjustment...................... $ 17,559 $ 16,509 $ 4,978
======== ======== =======
</TABLE>
- -------------------------
(1) Borrowings under the revolving credit facility at closing ($13,048) are
assumed to be outstanding for the entire period.
(2) Debt issuance costs are amortized over the life of the related debt, ranging
from 6 to 10 years using the interest method. The Unaudited Pro Forma
Condensed Consolidated Statements of Income do not include an extraordinary
charge of approximately $755 which represents the write-off of unamortized
debt issuance costs, net of income taxes associated with the Debt Repayment.
(3) An increase in the interest rate of 1/8% would change interest expense and
income from continuing operations by:
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED TWELVE MONTHS ENDED THREE MONTHS ENDED
DECEMBER 31, 1997 SEPTEMBER 30, 1997 DECEMBER 31, 1997
------------------- ------------------- ------------------
<S> <C> <C> <C>
Interest expense......... $423 $423 $106
====== ====== ======
Income from continuing
operations............. $258 $258 $ 64
====== ====== ======
</TABLE>
P-10
<PAGE> 11
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)
(g) Adjust amount of historical salaries paid to management in excess of
amounts per employment agreements included as part of the Transactions.
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED THREE MONTHS ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1997
------------------------------- -------------------------------
SELLING, SELLING,
GENERAL AND GENERAL AND
COST OF SALES ADMINISTRATIVE COST OF SALES ADMINISTRATIVE
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Salaries and wages:
Historical................................ $(1,348) $(2,343) $(241) $(385)
Per employment agreements................. 300 500 75 125
------- ------- ----- -----
$(1,048) $(1,843) $(166) $(260)
======= ======= ===== =====
</TABLE>
(h) Reclassify engineering, research and development expenses of McNeilus
to conform with the Oshkosh presentation.
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED THREE MONTHS ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1997
------------------- ------------------
<S> <C> <C>
Cost of goods sold........................ $(699) $(114)
======= =======
Engineering, research and development
expense................................. $ 699 $ 114
======= =======
</TABLE>
(i) Remove non-leasing interest income from McNeilus historical operating
results due to net borrowing position after consummation of the Transactions and
as a result of repayment of notes receivable from shareholders.
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED THREE MONTHS ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1997
------------------- ------------------
<S> <C> <C>
Miscellaneous income...................... $(1,765) $(356)
======= =======
</TABLE>
(j) Adjustment to record the tax effect on the above adjustments using
Oshkosh's marginal effective income tax rate of 39%. All adjustments were
tax-effected except for goodwill amortization.
(k) Included in historical and pro forma operating expense for McNeilus are
charitable contributions (including charitable contributions to national
organizations) of $1,109 and $284 for the twelve month and three month periods
ended November 30, 1997, respectively. While no pro forma reductions of these
expenses have been reflected in the pro forma statements of income, Oshkosh's
policy is to focus charitable contributions on needs of the communities in which
it operates. Management expects that annual charitable contribution levels for
the McNeilus entity would approximate $100.
P-11
<PAGE> 12
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)
(l) Historical and pro forma depreciation and amortization.
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA
- -------------------------------------- ------------------
OSHKOSH MCNEILUS TWELVE MONTHS
TWELVE MONTHS TWELVE MONTHS ENDED
ENDED ENDED PRO FORMA DECEMBER 31, 1997
DECEMBER 31, 1997 NOVEMBER 30, 1997 ADJUSTMENTS CONSOLIDATED
- ----------------- ----------------- ----------- -----------------
<S> <C> <C> <C>
$13,797 $3,884 $ 303 (c) $25,636
6,642 (e)
1,226 (f)
(216)(f)
</TABLE>
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA
- -------------------------------------- ------------------
OSHKOSH MCNEILUS TWELVE MONTHS
FISCAL YEAR TWELVE MONTHS ENDED
ENDED ENDED PRO FORMA SEPTEMBER 30, 1997
SEPTEMBER 30, 1997 NOVEMBER 30, 1997 ADJUSTMENTS CONSOLIDATED
- ------------------ ----------------- ----------- ------------------
<S> <C> <C> <C>
$14,070 $3,884 $ 303 (c) $25,907
6,642 (d)
1,226 (f)
(218)(f)
</TABLE>
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA
- ------------------------------------- ------------------
OSHKOSH MCNEILUS
- ----------------- ----------------- THREE MONTHS
THREE MONTHS ENDED ENDED
- ------------------------------------- PRO FORMA DECEMBER 31, 1997
DECEMBER 31, 1997 NOVEMBER 30, 1997 ADJUSTMENTS CONSOLIDATED
- ----------------- ----------------- ----------- -----------------
<S> <C> <C> <C>
$3,283 $952 $ 92 (c) $6,240
1,660 (d)
307 (f)
(54)(f)
</TABLE>
P-12
