SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-9172
NACCO Industries, Inc.
(Exact name of registrant as specified in its charter)
DELAWARE 34-1505819
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5875 LANDERBROOK DRIVE, MAYFIELD HEIGHTS, OHIO 44124
(Address of principal executive offices) Zip code
Registrant's telephone number, including area code (216) 449-9600
Former name, former address and former fiscal year, if changed since last report
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, and (2) has been subject to such filing requirements
for the last 90 days.
YES X NO
Number of shares of Class A Common Stock outstanding at July 31, 1995: 7,251,265
---------
Number of shares of Class B Common Stock outstanding at July 31, 1995: 1,714,089
---------
<PAGE>
NACCO INDUSTRIES, INC.
TABLE OF CONTENTS
Part I. FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheets - June
30, 1995 and December 31, 1994
Unaudited Consolidated Statements of
Income for the Three and Six Months
Ended June 30, 1995 and 1994
Unaudited Consolidated Statements of
Cash Flows for the Six Months Ended
June 30, 1995 and 1994
Notes to Unaudited Consolidated
Financial Statements
Item 2 Management's Discussion and Analysis
of Results of Operations and
Financial Condition
Part II. OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K
Exhibit Index
<PAGE>
PART I
Item 1 - Financial Statements
CONSOLIDATED BALANCE SHEETS
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
(Unaudited) (Audited)
JUNE 30 DECEMBER 31
1995 1994
(In thousands)
ASSETS
Current Assets
<S> <C> <C>
Cash and cash equivalents ...........................$ 30,359 $ 19,541
Accounts receivable, net ............................. 236,866 236,215
Inventories .......................................... 393,566 298,987
Prepaid expenses and other ........................... 29,455 31,893
---------- ----------
690,246 586,636
Other Assets ......................................... 44,007 41,341
Property, Plant and Equipment, Net ................... 506,865 485,314
Deferred Charges
Goodwill, net ........................................ 464,729 471,574
Deferred costs and other ............................. 54,712 69,257
Deferred income taxes ................................ 37,478 40,200
---------- ----------
556,919 581,031
---------- ----------
Total Assets $1,798,037 $1,694,322
========== ==========
</TABLE>
See notes to unaudited consolidated financial statements.
<PAGE>
CONSOLIDATED BALANCE SHEETS
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
(Unaudited) (Audited)
JUNE 30 DECEMBER 31
1995 1994
(In thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
<S> <C> <C>
Accounts payable ................................. $ 244,804 $ 226,892
Revolving credit agreements ...................... 66,509 30,760
Current maturities of long-term obligations ...... 15,655 63,509
Income taxes ..................................... 9,399 20,356
Accrued payroll .................................. 23,256 28,018
Other current liabilities ........................ 108,650 111,903
---------- ----------
468,273 481,438
Notes Payable - not guaranteed by
the parent company ............................... 354,593 286,717
Obligations of Project Mining Subsidiaries -
not guaranteed by the parent company or
its North American Coal subsidiary ............... 343,415 331,876
Obligation to United Mine Workers of America
Combined Benefit Fund ............................ 153,080 154,959
Self-insurance Reserves and Other .................... 128,259 119,399
Minority Interest .................................... 41,720 40,542
Stockholders' Equity
Common stock:
Class A, par value $1 per share, 7,249,361
shares outstanding (1994 - 7,228,739
shares outstanding) ........................ 7,249 7,229
Class B, par value $1 per share, convertible
into Class A on a one-for-one basis,
1,715,993 shares outstanding
(1994 - 1,722,981 shares outstanding) ...... 1,716 1,723
Capital in excess of par value ................... 3,528 2,788
Retained income .................................. 285,343 262,226
Foreign currency translation adjustment
and other ..................................... 10,861 5,425
---------- ----------
308,697 279,391
---------- ----------
Total Liabilities and Stockholders' Equity .... $1,798,037 $1,694,322
========== ==========
</TABLE>
See notes to unaudited consolidated financial statements.
<PAGE>
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
1995 1994 1995 1994
(In thousands, except per share data)
<S> <C> <C> <C> <C>
Net sales ........................................... $ 514,288 $ 433,490 $ 1,014,254 $ 814,541
Other operating income .............................. 3,311 3,417 5,716 5,614
----------- ----------- ----------- -----------
Total Revenues ........... 517,599 436,907 1,019,970 820,155
Cost of sales ....................................... 417,890 348,238 819,510 653,707
----------- ----------- ----------- -----------
Gross Profit ........... 99,709 88,669 200,460 166,448
Selling, administrative and
general expenses .................................. 64,099 54,558 127,201 108,612
Amortization of goodwill ............................ 3,422 3,425 6,845 6,873
----------- ----------- ----------- -----------
Operating Profit ........... 32,188 30,686 66,414 50,963
Other income (expense)
Interest income ................................. 1,898 424 2,291 762
Interest expense ................................ (12,385) (13,728) (26,407) (28,496)
Other - net ..................................... 963 (106) 1,257 (1,390)
----------- ----------- ----------- -----------
(9,524) (13,410) (22,859) (29,124)
----------- ----------- ----------- -----------
Income Before Income Taxes,
Minority Interest and
Extraordinary Charge ........... 22,664 17,276 43,555 21,839
Provision for income taxes .......................... 7,448 7,846 15,326 9,847
----------- ----------- ----------- -----------
Income Before Minority Interest
and Extraordinary Charge ........... 15,216 9,430 28,229 11,992
Minority interest ................................... (484) (239) (692) (31)
----------- ----------- ----------- -----------
Income Before Extraordinary Charge
14,732 9,191 27,537 11,961
Extraordinary charge, net-of-tax .................... -- (3,218) (1,280) (3,218)
----------- ----------- ----------- -----------
Net Income ........... $ 14,732 $ 5,973 $ 26,257 $ 8,743
=========== =========== =========== ===========
Income Before Extraordinary Charge $ 1.64 $ 1.03 $ 3.07 $ 1.34
Extraordinary charge,
net-of-tax ................................. -- (.36) (0.14) (.36)
----------- ----------- ----------- -----------
Net Income ...................................... $ 1.64 $ .67 $ 2.93 $ .98
=========== =========== =========== ===========
Cash dividends per share ........................ $ 0.180 $ .170 $ 0.350 $ .335
=========== =========== =========== ===========
</TABLE>
See notes to unaudited consolidated financial statements.
<PAGE>
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30
1995 1994
(In thousands)
Operating Activities
<S> <C> <C>
Net income ........................................................................... $ 26,257 $ 8,743
Adjustments to reconcile net income
to net cash provided by operating
activities:
Extraordinary charge, net-of-tax ................................................. 1,280 3,218
Depreciation, depletion and amortization ......................................... 39,603 39,995
Deferred income taxes ............................................................ 443 1,460
Other non-cash items ............................................................. 4,328 (4,082)
Working Capital Changes:
Accounts receivable .............................................................. (167) (1,659)
Inventories ...................................................................... (92,597) (67,284)
Other current assets ............................................................. 3,014 974
Accounts payable ................................................................. 22,071 38,500
Accrued income taxes ............................................................. (9,275) (12,181)
Other liabilities ................................................................ (13,143) 13,682
--------- ---------
Net cash provided (used) by operating activities .................... (18,186) 21,366
Investing Activities
Expenditures for property, plant and equipment ....................................... (33,801) (24,380)
Proceeds from the sale of assets ..................................................... 422 2,728
--------- ---------
Net cash used by investing activities .................... (33,379) (21,652)
Financing Activities
Additions to long-term obligations and
revolving credit ................................................................... 236,915 70,788
Reductions of long-term obligations and
revolving credit ................................................................... (177,061) (55,987)
Additions to obligations of project mining subsidiaries .............................. 26,855 27,217
Reductions of obligations of project mining subsidiaries ............................. (25,892) (32,542)
Cash dividends paid .................................................................. (3,137) (2,996)
Capital grants ....................................................................... 1,863 1,179
Other - net .......................................................................... 1,159 (352)
--------- ---------
Net cash provided by financing activities .................... 60,702 7,307
Effect of exchange rate changes on cash .............................................. 1,681 1,984
--------- ---------
Cash and Cash Equivalents
Increase for the period .............................................................. 10,818 9,005
Balance at the beginning of the period ............................................... 19,541 29,149
--------- ---------
Balance at the end of the period ..................................................... $ 30,359 $ 38,154
========= =========
</TABLE>
See notes to unaudited consolidated financial statements.
<PAGE>
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
(Tabular Dollars in Millions, Except Per Share Data)
Note A - Basis of Presentation
NACCO Industries, Inc. ("NACCO") is a holding company with four operating
subsidiaries: The North American Coal Corporation ("North American Coal"), NACCO
Materials Handling Group, Inc. ("NMHG"), Hamilton Beach/Proctor-Silex, Inc.
("HB/PS"), and The Kitchen Collection, Inc. ("KCI").
The accompanying unaudited consolidated financial statements include the
accounts of NACCO and its majority owned subsidiaries (NACCO Industries, Inc.
and Subsidiaries - the "Company"). Intercompany accounts have been eliminated.
These financial statements have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation of the financial position of the Company as of
June 30, 1995 and the results of its operations for the three and six month
periods and cash flows for the six month periods ended June 30, 1995 and 1994
have been included.
Operating results for the six month period ended June 30, 1995, are not
necessarily indicative of the results that may be expected for the year ended
December 31, 1995. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Company's annual report on Form
10-K for the year ended December 31, 1994.
Certain amounts in the prior periods' unaudited consolidated financial
statements have been reclassified to conform to the current period's
presentation.
<PAGE>
Note B - Inventories
Inventories are summarized as follows:
<TABLE>
<CAPTION>
June 30 December 31
1995 1994
Manufacturing inventories:
Finished goods and service parts
<S> <C> <C>
NACCO Materials Handling Group ........................................... $ 97.7 $ 82.3
Hamilton Beach/Proctor-Silex ............................................. 75.8 32.8
------ ------
173.5 115.1
------ ------
Raw materials and work in process
NACCO Materials Handling Group ........................................... 173.7 137.9
Hamilton Beach/Proctor-Silex ............................................. 17.4 15.9
------ -------
191.1 153.8
------ ------
LIFO reserve
NACCO Materials Handling Group ........................................... (14.3) (11.4)
Hamilton Beach/Proctor-Silex ............................................. (.4) (.1)
------ ------
(14.7) (11.5)
------ ------
Total manufacturing inventories ................................................ 349.9 257.4
North American Coal:
Coal ..................................................................... 10.6 8.4
Mining supplies .......................................................... 18.2 18.8
Retail inventories - Kitchen Collection ........................................ 14.9 14.4
------ ------
$393.6 $299.0
====== ======
</TABLE>
The cost of manufacturing inventories has been determined by the last-in,
first-out (LIFO) method for 72 percent and 69 percent of such inventories as of
June 30, 1995 and December 31, 1994, respectively.
Note C - Revolving Credit Agreements and Notes Payable
On February 28, 1995, NMHG entered into a new long-term credit agreement to
replace its previous bank agreement and to refinance the majority of its
existing long-term debt. The new agreement provides NMHG with an unsecured
$350.0 million revolving credit facility to replace its previous senior credit
facility. The new credit facility has a five-year maturity with extension
options and performance-based pricing comparable to its previous senior credit
facility which provides NMHG with reduced interest rates upon achievement of
certain financial performance targets.
Note D - Extraordinary Charge
The 1995 extraordinary charge, of $1.3 million, net of $0.9 million in tax
benefits, relates to the write off of deferred financing fees associated with
NMHG's former revolving credit facility and senior term loan which was replaced
by the new long-term credit agreement discussed in Note C above. As previously
announced, NMHG retired the remaining $78.5 million outstanding Hyster-Yale 12
3/8% debentures on August 1, 1995 at a price of 102.5. An extraordinary charge
of $2.1 million was recorded when these debentures were retired.
<PAGE>
Item 2 - Management's Discussion and Analysis of Results
of Operations and Financial Condition
(Tabular Dollars in Millions, Except Per Share Data)
FINANCIAL SUMMARY
NACCO's four operating subsidiaries function in distinct business environments,
and the results of operations and financial condition are best discussed at the
subsidiary level as presented below. The results for "North American Coal" have
been adjusted to exclude the previously combined results of Bellaire
Corporation, a non-operating subsidiary of NACCO.
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
1995 1994 1995 1994
REVENUES
<S> <C> <C> <C> <C>
NACCO Materials Handling Group ........................... $370.2 $ 290.4 $ 733.3 $535.7
Hamilton Beach/Proctor-Silex ............................. 79.7 76.1 146.7 144.7
North American Coal ...................................... 55.3 58.8 115.8 118.0
Kitchen Collection ....................................... 13.5 12.4 25.6 23.2
Bellaire ................................................. .3 .2 .3 .4
Eliminations ............................................. (1.4) (1.0) (1.7) (1.9)
------ -------- -------- ------
$517.6 $ 436.9 $1,020.0 $820.1
====== ======== ======== ======
AMORTIZATION OF GOODWILL
NACCO Materials Handling Group ........................... $ 2.7 $ 2.7 $ 5.4 $ 5.4
Hamilton Beach/Proctor-Silex ............................. .7 .7 1.4 1.4
----- ------- ------- -----
$ 3.4 $ 3.4 $ 6.8 $ 6.8
====== ======== ======== ======
OPERATING PROFIT (LOSS)
NACCO Materials Handling Group ........................... $ 21.9 $ 19.8 $ 45.5 $ 30.9
Hamilton Beach/Proctor-Silex ............................. 3.6 3.5 5.0 3.1
North American Coal ...................................... 9.2 9.4 21.0 21.4
Kitchen Collection ....................................... (.4) .2 (.8) --
Bellaire ................................................. -- -- (.1) --
NACCO .................................................... (2.1) (2.2) (4.2) (4.4)
------ -------- -------- ------
$ 32.2 $ 30.7 $ 66.4 $ 51.0
====== ======== ======== ======
OPERATING PROFIT (LOSS) EXCLUDING GOODWILL
AMORTIZATION
NACCO Materials Handling Group ........................... $ 24.6 $ 22.5 $ 50.9 $ 36.3
Hamilton Beach/Proctor-Silex ............................. 4.3 4.2 6.4 4.5
North American Coal ...................................... 9.2 9.4 21.0 21.4
Kitchen Collection ....................................... (.4) .2 (.8) --
Bellaire ................................................. -- -- (.1) --
NACCO .................................................... (2.1) (2.2) (4.2) (4.4)
------ -------- -------- ------
$ 35.6 $ 34.1 $ 73.2 $ 57.8
====== ======== ======== ======
INTEREST INCOME
NACCO Materials Handling Group ........................... $ .4 $ .2 $ .7 $ .4
North American Coal ...................................... .9 .7 1.6 1.3
Bellaire ................................................. .5 .3 .8 .6
NACCO .................................................... 1.0 .2 1.1 .4
Eliminations ............................................. (.9) (1.0) (1.9) (1.9)
------ -------- -------- ------
$ 1.9 $ .4 $ 2.3 $ .8
====== ======== ======== ======
</TABLE>
<PAGE>
FINANCIAL SUMMARY - continued
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
1995 1994 1995 1994
INTEREST EXPENSE
<S> <C> <C> <C> <C>
NACCO Materials Handling Group ................................... $ (8.0) $ (9.2) $(15.5) $(17.9)
Hamilton Beach/Proctor-Silex ..................................... (1.7) (1.8) (3.3) (3.2)
North American Coal .............................................. (.4) (.3) (.8) (.6)
Kitchen Collection ............................................... (.1) (.1) (.2) (.1)
NACCO ............................................................ (.8) (.8) (1.6) (1.5)
Eliminations ..................................................... .9 1.0 1.9 1.9
------ ------ ------ ------
(10.1) (11.2) (19.5) (21.4)
Project mining subsidiaries ...................................... (2.3) (2.5) (6.9) (7.1)
------ ------ ------ ------
$(12.4) $(13.7) $(26.4) $(28.5)
====== ====== ====== ======
OTHER-NET, INCOME (EXPENSE)
NACCO Materials Handling Group ................................... $ 1.0 $ .1 $ 1.1 $ (.5)
Hamilton Beach/Proctor-Silex ..................................... (.1) -- (.2) (.4)
North American Coal .............................................. -- (.3) .2 (.9)
Bellaire ......................................................... -- -- -- .1
NACCO ............................................................ .1 .1 .2 .3
------ ------ ------ ------
$ 1.0 $ (.1) $ 1.3 $ (1.4)
====== ====== ====== ======
NET INCOME (LOSS)
Before Extraordinary Charge
NACCO Materials Handling Group ................................... $ 8.9 $ 5.3 $ 18.6 $ 6.1
Hamilton Beach/Proctor-Silex ..................................... 1.1 .9 .9 (.3)
North American Coal .............................................. 5.4 4.6 10.6 9.4
Kitchen Collection ............................................... (.3) .1 (.6) --
Bellaire ......................................................... .4 .1 .6 .3
NACCO ............................................................ (.3) (1.6) (1.9) (3.6)
Minority interest ................................................ (.5) (.2) (.6) --
------ ------ ------ ------
14.7 9.2 27.6 11.9
Extraordinary charge,
net-of-tax ................................................... (3.2) (1.3) (3.2)
------ ------ ------ ------
$ 14.7 $ 6.0 $ 26.3 $ 8.7
====== ====== ====== ======
DEPRECIATION, DEPLETION AND AMORTIZATION EXPENSE
NACCO Materials Handling Group ................................... $ 16.2 $ 16.2
Hamilton Beach/Proctor-Silex ..................................... 8.0 7.7
North American Coal .............................................. .8 .8
Kitchen Collection ............................................... .5 .4
NACCO ............................................................ .1 .1
------ ------
25.6 25.2
Project mining subsidiaries ........................................ 14.0 14.7
------ ------
$ 39.6 $ 39.9
====== ======
CAPITAL EXPENDITURES
NACCO Materials Handling Group ................................... $ 17.9 $ 13.9
Hamilton Beach/Proctor-Silex ..................................... 4.3 6.0
North American Coal .............................................. 1.3 .3
Kitchen Collection ............................................... .9 .5
NACCO ............................................................ .1 --
------ ------
24.5 20.7
Project mining subsidiaries ...................................... 9.3 3.7
------ ------
$ 33.8 $ 24.4
====== ======
</TABLE>
<PAGE>
FINANCIAL SUMMARY - continued
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1995 1994
TOTAL ASSETS
<S> <C> <C>
NACCO Materials Handling Group ........................................... $ 983.2 $ 906.2
Hamilton Beach/Proctor-Silex ............................................. 306.9 289.6
North American Coal ...................................................... 60.6 49.0
Kitchen Collection ....................................................... 23.3 26.0
Bellaire ................................................................. 85.2 87.1
NACCO .................................................................... 17.9 26.6
-------- --------
1,477.1 1,384.5
Project mining subsidiaries .............................................. 417.6 412.3
-------- --------
1,894.7 1,796.8
Consolidating eliminations ............................................... (96.7) (102.5)
-------- --------
$1,798.0 $1,694.3
======== ========
</TABLE>
NORTH AMERICAN COAL
North American Coal mines and markets lignite for use primarily as fuel for
power generation by electric utilities. The lignite is surface mined in North
Dakota, Texas and Louisiana. Total coal reserves approximate 2.2 billion tons
with 1.4 billion tons committed to electric utility customers pursuant to
long-term contracts.
FINANCIAL REVIEW
North American Coal's three project mining subsidiaries (Coteau, Falkirk and
Sabine) mine lignite for utility customers pursuant to long-term contracts at a
price based on actual cost plus an agreed pretax profit per ton. Due to the
cost-plus nature of these contracts, revenues and operating profits are impacted
by increases and decreases in operating costs, as well as by sales tons. Net
income of these project mines, however, is not significantly affected by changes
in such operating costs, which include costs of operations, interest expense and
certain other income and expense items. Because of the nature of the contracts
at these mines, operating results are best analyzed in terms of income before
taxes and net income.
North American Coal's results for 1994 have been adjusted to include certain
royalty and other payments previously classified with Bellaire, a non-operating
subsidiary of NACCO, that are more appropriately classified with North American
Coal.
<PAGE>
NORTH AMERICAN COAL - continued
FINANCIAL REVIEW - continued
Tons sold by North American Coal's four operating mines were as follows for the
three and six month periods ended June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Coteau Properties ................................... 3.3 3.6 7.4 7.7
Falkirk Mining ...................................... 1.6 1.6 3.5 3.4
Sabine Mining ....................................... .7 .7 1.6 1.6
Red River Mining .................................... .3 .3 .4 .4
--- ---- ---- ----
5.9 6.2 12.9 13.1
=== ==== ==== ====
</TABLE>
Revenues, income before taxes, provision for taxes and net income were as
follows for the three and six months ended June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Revenues from operating mines ........................... $52.3 $ 55.6 $110.5 $112.8
Royalties and other ..................................... 3.0 3.2 5.3 5.2
----- ------ ------ ------
$55.3 $ 58.8 $115.8 $118.0
===== ====== ====== ======
Income before tax from
operating mines ..................................... $ 5.9 $ 5.9 $ 12.7 $ 12.3
Royalty and other income, net ........................... 2.9 2.2 5.4 4.2
Headquarters expense .................................... (1.3) (1.1) (3.0) (2.4)
----- ------ ------ ------
7.5 7.0 15.1 14.1
Provision for taxes ..................................... 2.1 2.4 4.5 4.7
----- ------ ------ ------
Net income .......................................... $ 5.4 $ 4.6 $ 10.6 $ 9.4
===== ====== ====== ======
</TABLE>
<PAGE>
NORTH AMERICAN COAL - continued
FINANCIAL REVIEW - continued
Second Quarter of 1995 Compared with Second Quarter of 1994
The following schedule details the components of the changes in revenues, income
before taxes and net income for the three months ended June 30:
<TABLE>
<CAPTION>
Income
Before Net
Revenues Taxes Income
<S> <C> <C> <C>
1994 $58.8 $7.0 $4.6
Increase (decrease) in 1995 from:
Project mining subsidiaries
Tonnage volume ................................................. (2.8) (.2) (.1)
Agreed profit per ton .......................................... .1 .1 .1
Pass-through costs ............................................. (1.2) -- --
Other Mining Operations
Tonnage volume ................................................. 1.0 .4 .2
Mix of tons sold ............................................... .5 .5 .4
Average selling price .......................................... (.9) (.9) (.6)
Operating costs ................................................ -- .1 .1
Other income (expense) ......................................... -- -- --
----- ---- ----
Variances from operating mines ........................................ (3.3) -- .1
Royalties and other income, net ................................... (.2) .7 .4
Headquarters expense .............................................. -- (.2) (.1)
Differences between effective and
statutory tax rates ............................................ -- -- .4
----- ---- ----
1995 $55.3 $7.5 $5.4
===== ==== ====
</TABLE>
The unfavorable volume variance at the project mines relates primarily to
Coteau. Coteau's shipments to its customer have been reduced because of
shut-downs at its customer's generating plants due to upgrades and maintenance
and the availability of excess hydro-power from the northwestern United States
and Canada. The northwestern United States and Canada has experienced a high
level of rainfall in 1995 resulting in the increased availability of
hydro-power. Increased customer requirements at Red River caused the favorable
volume variance for other mining operations. In addition, Red River has a new
agreement with its customer that extends the contract term nine years in
exchange for a lower sales prices per ton, resulting in the unfavorable price
variance at other mining operations. Royalty income favorably impacted
operations due to the timing of the receipt of royalties relating to former
eastern coal reserves.
<PAGE>
NORTH AMERICAN COAL - continued
FINANCIAL REVIEW - continued
First Six Months of 1995 Compared with First Six Months of 1994
The following schedule details the components of the changes in revenues, income
before taxes and net income for the six months ended June 30:
<TABLE>
<CAPTION>
Income
Before Net
Revenues Taxes Income
<S> <C> <C> <C>
1994 $118.0 $14.1 $ 9.4
Increase (decrease) in 1995 from:
Project mining subsidiaries
Tonnage volume ................................................ (1.1) (.1) --
Mix of tons sold .............................................. .2 .2 .2
Agreed profit per ton ......................................... .2 .2 .1
Pass-through costs ............................................ (1.4) -- --
Other Mining Operations
Tonnage volume ................................................ .2 .1 --
Mix of tons sold .............................................. 2.6 2.6 1.7
Average selling price ......................................... (3.1) (3.1) (2.0)
Operating costs ............................................... .4 .2
Other income (expense) ........................................ .1 .1
--- --- ---
Variances from operating mines ...................................... (2.4) .4 .3
Royalties and other income, net ................................... .2 1.2 .8
Headquarters expense .............................................. (.6) (.4)
Differences between effective and
statutory tax rates ........................................... .5
--- --- ---
1995 $115.8 $ 15.1 $ 10.6
====== ===== =====
</TABLE>
The reduction in customer demand at Coteau during the second quarter, partially
offset by higher shipments at Falkirk due to increased customer requirements
resulted in an unfavorable volume variance at the project mines during the fist
six months of 1995. The favorable mix variance at other mining operations during
the first six months of 1995 results from increased sales of base tons at Red
River which yield a higher price as specified in the supply contract. The
unfavorable price variance at other mining operations relates to the new
agreement Red River signed with its customer which extends the contract term in
exchange for a lower sales price per ton. The timing of the receipt of royalties
relating to former eastern coal reserves favorably impacted operations.
<PAGE>
NORTH AMERICAN COAL - continued
FINANCIAL REVIEW - continued
Other Income and Expense
Items of other income (expense) for the three and six months ended June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
Interest income
<S> <C> <C> <C> <C>
Project mining subsidiaries ......................... $ .3 $ .2 $ .6 $ .3
Other mining operations ............................. .6 .5 1.0 1.0
---- ---- ---- -----
$ .9 $ .7 $1.6 $ 1.3
==== ==== ==== =====
Interest expense
Project mining subsidiaries ......................... $(2.3) $(2.5) $(6.9) $(7.1)
Other mining operations ............................. (.4) (.3) (.8) (.6)
---- ---- ---- -----
$(2.7) $(2.8) $(7.7) $(7.7)
==== ==== ===== =====
Other-net
Project mining subsidiaries ......................... -- $ .4 $ .1 .5
Other mining operations ............................. -- (.7) .1 (1.4)
---- ---- ---- -----
-- $(.3) $ .2 $ (.9)
==== ==== ==== =====
</TABLE>
Provision for Income Taxes
North American Coal's effective tax rate for the three months ended June 30,
1995 and 1994 was 28.4 percent and 33.7 percent, respectively. North American
Coal's effective tax rate for the six months ended June 30, 1995 and 1994 was
29.5 percent and 33.3 percent, respectively. The reduction in the effective tax
rate in the second quarter and first six months of 1995 compared with 1994 is
due to the recognition of an income tax refund of approximately $0.1 million
(net of approximately $0.1 million in taxes on related interest) from prior tax
years in the second quarter of 1995 and certain state tax impacts.
LIQUIDITY AND CAPITAL RESOURCES
North American Coal has in place a $50.0 million revolving credit facility. The
expiration date of this facility (which currently is September 1997) can be
extended one additional year, on an annual basis, upon the mutual consent of
North American Coal and the bank group. North American Coal had $28.0 million of
its revolving credit facility available at June 30, 1995.
The financing of the project mining subsidiaries, which is guaranteed by the
utility customers, comprises long-term equipment leases, notes payable and
non-interest-bearing advances from customers. The obligations of the project
mining subsidiaries do not impact the short- or long-term liquidity of the
company and are without recourse to NACCO or North American Coal. These
arrangements allow the project mining subsidiaries to pay dividends in amounts
equal to their retained earnings.
<PAGE>
NORTH AMERICAN COAL - continued
LIQUIDITY AND CAPITAL RESOURCES - continued
North American Coal's capital structure, excluding the project mining
subsidiaries, is presented below:
<TABLE>
<CAPTION>
June 30 December 31
1995 1994
<S> <C> <C>
Total Tangible Assets ...................................................... $ 7.3 $ 9.5
Parent Company Advances .................................................... 32.5 22.7
----- -----
Total Assets ............................................................ $39.8 $32.2
===== =====
Debt Related to Parent Advances ............................................ $23.7 $16.7
Other Debt ................................................................. .3 0.4
----- -----
Total Debt .............................................................. 24.0 17.1
Stockholder's Equity ....................................................... 15.8 15.1
----- -----
Total Capitalization .................................................... $39.8 $32.2
===== =====
Debt to Total Capitalization ............................................... 60% 53%
</TABLE>
<PAGE>
NACCO MATERIALS HANDLING GROUP
NMHG, 97 percent-owned by NACCO, designs, manufactures and markets forklift
trucks and related service parts under the Hyster(R) and Yale(R) brand names.
FINANCIAL REVIEW
The results of operations for NMHG were as follows for the three and six months
ended June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
Revenues
<S> <C> <C> <C> <C>
Americas ................................................ $240.5 $203.1 $490.0 $377.2
Europe, Africa and Middle East .......................... 107.3 70.8 203.0 129.4
Asia-Pacific ............................................ 22.4 16.5 40.3 29.1
------ ------ ------ ------
$370.2 $290.4 $733.3 $535.7
====== ====== ====== ======
Operating profit
Americas ................................................ $ 13.0 $ 14.8 $ 29.9 $ 24.2
Europe, Africa and Middle East .......................... 8.3 3.4 14.0 4.0
Asia-Pacific ............................................ .6 1.6 1.6 2.7
------ ------ ------ ------
$ 21.9 $ 19.8 $ 45.5 $ 30.9
====== ====== ====== ======
Operating profit excluding
goodwill amortization
Americas ................................................ $ 15.1 $ 16.8 $ 33.9 $ 28.2
Europe, Africa and Middle East .......................... 8.9 4.1 15.4 5.4
Asia-Pacific ............................................ .6 1.6 1.6 2.7
------ ------ ------ ------
$ 24.6 $ 22.5 $ 50.9 $ 36.3
====== ====== ====== ======
Net income before extraordinary charge ...................... $ 8.9 $ 5.3 $ 18.6 $ 6.1
Extraordinary charge, net-of-tax ............................ -- (3.2) (1.3) (3.2)
------ ------ ------ ------
Net income .............................................. $ 8.9 $ 2.1 $ 17.3 $ 2.9
====== ====== ====== ======
</TABLE>
<PAGE>
NACCO MATERIALS HANDLING GROUP - continued
FINANCIAL REVIEW - continued
Second Quarter of 1995 Compared With Second Quarter of 1994
The following schedule details the components of the changes in revenues,
operating profit and net income for the second quarter of 1995 compared with
1994:
<TABLE>
<CAPTION>
Operating Net
Revenues Profit Income
<S> <C> <C> <C>
1994 $ 290.4 $ 19.8 $ 2.1
Increase (Decrease) in 1995 from:
Unit volume ..................................................... 55.9 10.5 6.8
Sales mix ....................................................... (6.2) (3.0) (2.0)
Average sales price ............................................. 14.0 14.0 9.1
Service parts ................................................... 5.8 3.1 2.0
Foreign currency ................................................ 10.3 (5.7) (3.7)
Manufacturing cost .............................................. (9.6) (6.2)
Other operating expense ......................................... (7.2) (4.8)
Other income and expense ........................................ 1.2
Differences between effective
and statutory tax rates ..................................... 1.2
Extraordinary charge ............................................ 3.2
------ ----- ----
1995 $ 370.2 $ 21.9 $ 8.9
====== ===== ====
</TABLE>
Unit volumes in the second quarter increased 17 percent in the Americas, 34
percent in Europe and 74 percent in Asia-Pacific. The lift truck market size in
North America remains steady while market size in Europe and Asia-Pacific
continue to improve. The price increases announced in mid-1994 favorably
impacted results of operations. NMHG announced additional price increases in the
spring of 1995 which will become effective later in 1995. These price increases
were enacted in order to offset the adverse affects of higher raw material costs
and the strength of the yen relative to the dollar which increased the cost of
purchases sourced from Japan. Manufacturing inefficiencies due to vendor parts
shortages, partially offset by higher factory throughput, resulted in an
unfavorable manufacturing cost variance. The increase in other operating
expenses in 1995 is due primarily to higher volume related customer service
costs and general inflation.
<PAGE>
NACCO MATERIALS HANDLING GROUP - continued
FINANCIAL REVIEW - continued
First Six Months of 1995 Compared With First Six Months of 1994
The following schedule details the components of the changes in revenues,
operating profit and net income for the first six months of 1995 compared with
1994:
<TABLE>
<CAPTION>
Operating Net
Revenues Profit Income
<S> <C> <C> <C>
1994 $ 535.7 $ 30.9 $ 2.9
Increase (Decrease) in 1995 from:
Unit volume .................................................... 141.8 27.0 17.6
Sales mix ...................................................... (4.7) (5.7) (3.7)
Average sales price ............................................ 28.6 28.6 18.6
Service parts .................................................. 12.4 6.4 4.2
Foreign currency ............................................... 19.5 (7.0) (4.4)
Manufacturing cost ............................................. (19.0) (12.4)
Other operating expense ........................................ (15.7) (10.2)
Other income and expense ....................................... 2.3
Differences between effective
and statutory tax rates ...................................... .5
Extraordinary charge ........................................... 1.9
------ ----- -----
1995 $ 733.3 $ 45.5 $17.3
====== ===== =====
</TABLE>
Unit volumes during the first six months of 1995 increased 27 percent in the
Americas, 45 percent in Europe and 62 percent in Asia-Pacific when compared with
1994. The price increases announced in mid-1994 favorably impacted operating
results during the first six months of 1995. These price increases were enacted
to offset the raw material cost increases and currency impacts noted below.
The negative impact from currency results from the strength of the yen relative
to the dollar which increased the cost of purchases sourced from Japan,
partially offset by the strength of certain European currencies relative to the
dollar. The unfavorable impact from manufacturing costs is due to increased
material prices and manufacturing inefficiencies caused by vendor parts
shortages partially offset by higher factory production levels. Increases in
volume related customer service costs and general inflation resulted in higher
other operating expenses.
NMHG's backlog of orders at June 30, 1995 was approximately 26,100 forklift
truck units compared to the 24,600 forklift truck units at December 31, 1994.
The continued high order rate, coupled with the vendor parts shortages, have
caused backlog to increase from December 31, 1994. The company expects to
resolve its vendor parts supply problems by the end of 1995.
<PAGE>
NACCO MATERIALS HANDLING GROUP - continued
FINANCIAL REVIEW - continued
Other Income and Expense
Below is a detail of other income (expense) for the three and six months ended
June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Interest income .................................. $ .4 $ .2 $ .7 $ .4
Interest expense ................................. $(8.0) $(9.2) $(15.5) $(17.9)
Other-net ........................................ $ 1.0 $ .1 $ 1.1 $ (.5)
</TABLE>
The lower interest expense in 1995 is primarily due to the retirements in 1994
of 12 3/8% subordinated debentures. The improvement in other-net in 1995 results
primarily from dividend income received from NMHG's unconsolidated Brazilian
subsidiary and reduced foreign exchange losses.
Provision for Income Taxes
NMHG's effective tax rate for the three months ended June 30, 1995 and 1994 was
41.7 percent and 51.7 percent, respectively. NMHG's effective tax rate for the
first six months of 1995 and 1994 was 41.6 percent and 52.0 percent,
respectively. The higher level of pretax earnings in 1995 reduced the effect of
nondeductible goodwill amortization resulting in a lower effective tax rate in
1995. In addition, the recognition in the second quarter of 1995 of an income
tax refund of approximately $0.3 million (net of approximately $0.2 million in
taxes on related interest) from prior tax years also lowered the effective tax
rate in 1995.
Extraordinary Charge
The 1995 extraordinary charge of $1.3 million, net of $0.9 million in tax
benefits, which was recognized in the first quarter, relates to the write off of
deferred financing fees associated with NMHG's former revolving credit facility
and senior term loan which was replaced by the new long-term credit agreement
discussed in the following section. The 1994 extraordinary charge, recognized in
the second quarter, of $3.2 million, net of $2.0 million in tax benefits,
reflects the write-off of premiums and unamortized debt issuance costs
associated with the retirement of Hyster-Yale 12 3/8% debentures.
As previously announced, NMHG retired the remaining $78.5 million outstanding
Hyster-Yale 12 3/8% debentures on August 1, 1995 at a price of 102.5. An
extraordinary charge of $2.1 million was recorded when these debentures were
retired.
<PAGE>
NACCO Materials Handling Group - continued
LIQUIDITY AND CAPITAL RESOURCES
Expenditures for property, plant and equipment were $17.9 million during the
first six months of 1995. The increased demand for lift trucks has required NMHG
to invest in its productive capacity. NMHG is investing to break bottlenecks at
all of its plants and has undertaken expansion of its Craigavon, Northern
Ireland and Irvine, Scotland production facilities. It is estimated that NMHG's
capital expenditures for the remainder of 1995 will be approximately $11.6
million. The principal sources of financing for these capital expenditures are
internally generated funds, bank borrowings and government assistance grants.
On February 28, 1995, the company entered into a new long-term credit agreement
to replace its previous bank agreement and to refinance the majority of its
existing long-term debt. The new agreement provides the company with an
unsecured $350.0 million revolving credit facility to replace its previous
senior credit facility. The new credit facility has a five-year maturity with
extension options and performance-based pricing comparable to its previous
senior credit facility which provides the company with reduced interest rates
upon achievement of certain financial performance targets.
The company believes it can meet all of its current and long-term commitments
and operating needs from operating cash flows and funds available under
revolving credit agreements. At June 30, 1995 NMHG had available $152.0 million
of its $350.0 million revolving credit facility.
NMHG's capital structure is presented below:
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1995 1994
<S> <C> <C>
Total Tangible Assets .......................................................... $251.4 $192.9
Goodwill at Cost ............................................................... 433.5 433.5
------ ------
Total Assets Before Goodwill Amortization .................................. 684.9 626.4
Less: Accumulated Goodwill Amortization ................................... 65.8 60.4
------ ------
Total Assets ............................................................ $619.1 $566.0
====== ======
Total Debt ..................................................................... $290.3 $260.1
Stockholders' Equity ........................................................... 328.8 305.9
------ ------
Total Capitalization .................................................... $619.1 $566.0
====== ======
Debt to Total Capitalization ................................................... 47% 46%
</TABLE>
<PAGE>
Hamilton Beach/Proctor-Silex
HB/PS, 80 percent-owned by NACCO, is a leading manufacturer of small electric
appliances. The housewares business is seasonal. A majority of revenues and
operating profit occurs in the second half of the year when sales of small
electric appliances increase significantly for the fall holiday selling season.
FINANCIAL REVIEW
The results of operations for HB/PS were as follows for the three and six months
ended June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Revenues ................................................ $79.7 $76.1 $146.7 $144.7
Operating profit ........................................ $ 3.6 $ 3.5 $ 5.0 $ 3.1
Operating profit excluding
goodwill amortization ............................ $ 4.3 $ 4.2 $ 6.4 $ 4.5
Net income (loss) ....................................... $ 1.1 $ .9 $ .9 $ (.3)
</TABLE>
Second Quarter of 1995 Compared With Second Quarter of 1994
The following schedule details the components of the changes in revenues,
operating profit and net income for the second quarter of 1995 compared with
1994:
<TABLE>
<CAPTION>
Operating Net
Revenues Profit Income
<S> <C> <C> <C>
1994 $76.1 $3.5 $.9
Increase (Decrease) in 1995 from:
Unit volume
Good ........................................................ .3 .5 .3
Better ...................................................... .3 .3 .2
Best ........................................................ 2.9 1.0 .7
---- --- ---
3.5 1.8 1.2
Foreign currency translation ........................................ .1 .1 --
Manufacturing cost .................................................. (1.1) (.7)
Other operating expense ............................................. -- (.7) (.5)
Differences between effective
and statutory tax rates ............................................. -- -- .2
---- ---- ----
1995 $79.7 $3.6 $ 1.1
===== ==== ====
</TABLE>
<PAGE>
Hamilton Beach/Proctor-Silex - continued
FINANCIAL REVIEW - continued
Increased sales of coffeemakers, canopeners, mixers, irons, food processors,
slowcookers and blenders, slightly offset by reductions in domestic toaster oven
and toaster and Canadian sales, resulted in a favorable impact from volume on
results in the second quarter of 1995. In addition, a shift in sales to products
in the best category and favorable mix shifts within the good and better
categories to higher margin product lines favorably impacted operating profit
and net income. The increase in manufacturing costs relates primarily to
increased raw material prices and lower throughput at certain factories. Higher
marketing and selling expenditures caused the unfavorable variance from other
operating expenses.
First Six Months of 1995 Compared with First Six Months of 1994
The following schedule details the components of the changes in the revenues,
operating profit and net income (loss) for the first six months of 1995 compared
with 1994:
<TABLE>
<CAPTION>
Net
Operating Income
Revenues Profit (Loss)
<S> <C> <C> <C>
1994 $144.7 $ 3.1 $(.3)
Increase (Decrease) in 1995 from:
Unit volume
Good ........................................................ (5.2) (.1) (.1)
Better ...................................................... .1 .5 .3
Best ........................................................ 6.8 2.7 1.8
--- --- ---
1.7 3.1 2.0
Average sales price ................................................. .4 .4 .2
Foreign currency translation ........................................ (.1) (.1) --
Manufacturing cost .................................................. (.4) (.3)
Other operating expense ............................................. -- (1.1) (.7)
---- ---- ----
1995 $146.7 $ 5.0 $ .9
===== ==== ====
</TABLE>
The favorable volume variance relates to increased sales of irons, coffeemakers,
canopeners, mixers, slowcookers and electric knives partially offset by reduced
blender, toaster oven and toaster sales domestically and Canadian sales. Sales
mix shifts to higher margin product lines within the good and better product
categories and an overall shift in sales to the best product category resulted
in improved profitability during the first six months of 1995. Increased raw
materials costs and lower throughput at certain factories caused the unfavorable
impact from manufacturing costs. Higher marketing and selling expenditures
caused the unfavorable variance in other operating expenses.
<PAGE>
Hamilton Beach/Proctor-Silex - continued
FINANCIAL REVIEW - continued
Other Income and Expense
Below is a detail of other income (expense) for the three and six months ended
June 30:
<TABLE>
<CAPTION>
Three Months Six Months
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Interest expense ................................... $(1.7) $(1.8) $(3.3) $(3.2)
Other-net .......................................... $ (.1) -- $ (.2) $ (.4)
</TABLE>
Provision for Income Taxes
HB/PS's effective tax rate for the three months ended June 30, 1995 and 1994 was
35.4 percent and 45.1 percent, respectively. HB/PS's effective tax rate for the
first six months of 1995 and 1994 was 33.5 percent and 45.1 percent,
respectively. The reduction in HB/PS's effective tax rate in 1995 is due to the
utilization of foreign tax credits, which reduced HB/PS's U.S. federal income
taxes, received as a result of the repatriation of foreign earnings previously
taxed at a rate in excess of the U.S. statutory tax rate.
LIQUIDITY AND CAPITAL RESOURCES
Expenditures for property, plant and equipment were $4.3 during the first six
months of 1995 and are estimated to be $8.4 million for the remainder of 1995.
The primary purpose of these expenditures is to increase manufacturing
efficiency and to acquire tooling for new and existing products. These
expenditures are funded primarily from internally generated funds.
HB/PS's credit agreement provides for a revolving credit facility ("Facility")
that permits advances up to $135.0 million. At June 30, 1995, HB/PS had $32.7
million available under this Facility. The expiration date of this Facility
(which currently is May 1998) may be extended annually for one additional year
upon the mutual consent of HB/PS and the bank group. On April 28, 1995 this
Facility was amended to provide a lower interest rate if HB/PS achieves a
certain interest coverage ratio and to allow for interest rates quoted under a
competitive bid option. At June 30, 1995, HBPS also had $23.0 million available
under separate facilities.
<PAGE>
Hamilton Beach/Proctor-Silex - continued
FINANCIAL REVIEW - continued
LIQUIDITY AND CAPITAL RESOURCES - continued
HB/PS's capital structure is presented below:
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1995 1994
<S> <C> <C>
Total Tangible Assets .......................................................... $143.2 $118.3
Goodwill at Cost ............................................................... 110.5 110.5
------ ------
Total Assets Before Goodwill Amortization .................................... 253.7 228.8
Less: Accumulated Goodwill Amortization ..................................... 17.2 15.8
------ ------
Total Assets .............................................................. $236.5 $213.0
====== ======
Total Debt ................................................................... $105.2 $ 82.6
Stockholders' Equity ......................................................... 131.3 130.4
------ ------
Total Capitalization ...................................................... $236.5 $213.0
====== ======
Debt to Total Capitalization ................................................. 44% 39%
</TABLE>
<PAGE>
KITCHEN COLLECTION
KCI is a national specialty retailer of kitchenware, tableware, small electric
appliances and related accessories. The specialty retail business is seasonal
with the majority of its revenues and operating profit generated in the fourth
quarter during the fall holiday selling season.
FINANCIAL REVIEW
Second Quarter of 1995 Compared With Second Quarter of 1994
The following schedule details the components of the changes in revenues,
operating profit and net income (loss) for the second quarter of 1995 compared
with 1994:
<TABLE>
<CAPTION>
Operating Net
Profit Income
Revenues (Loss) (Loss)
<S> <C> <C> <C>
1994 $ 12.4 $ .2 $ .1
Increase (decrease) in 1995 from:
Stores opened in 1995 ......................................... .3 (.1) (.1)
Stores opened in 1994 ......................................... 1.3 - -
Comparable stores ............................................. (.5) (.3) (.2)
Other ......................................................... (.2) (.1)
----- ---- ----
1995 $ 13.5 $(.4) $(.3)
===== ==== ====
</TABLE>
First Six Months of 1995 Compared With First Six Months of 1994
The following schedule details the components of the changes in revenues,
operating profit and net loss for the first six months of 1995 compared with
1994:
<TABLE>
<CAPTION>
Operating Net
Revenues Profit Loss
<S> <C> <C> <C>
1994 $ 23.2 $ - $ -
Increase (decrease) in 1995 from:
Stores opened in 1995 ......................................... .3 (.1) (.1)
Stores opened in 1994 ......................................... 3.0 - -
Comparable stores ............................................. (.9) (.5) (.3)
Other ......................................................... (.2) (.2)
----- ----- ----
1995 $ 25.6 $(.8) $(.6)
===== ===== ====
</TABLE>
<PAGE>
KITCHEN COLLECTION - continued
FINANCIAL REVIEW - continued
Provision for Income Taxes
KCI'S effective tax rate for the three months ended June 30, 1995 and 1994 was
41.1 percent and 40.8 percent, respectively. KCI's effective tax rate for the
first six months of 1995 and 1994 was 40.9 percent and 38.9 percent,
respectively.
LIQUIDITY AND CAPITAL RESOURCES
Expenditures for property, plant and equipment were $0.9 million during the
first six months of 1995. Estimated capital expenditures for the remainder of
1995 are $1.1 million. These expenditures are primarily for new store openings
and improvements to existing facilities. The principal source of funds for these
capital expenditures is internally generated funds. In May, Kitchen Collection
entered into a new $5.0 million revolving credit facility which replaced the
previous $2.5 million line of credit. This new facility has performance based
pricing which provides for reduced interest rates based on achievement of
certain financial performance measures. At June 30, 1995, KCI had $3.0 million
available under this facility.
KCI's capital structure is presented below:
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1995 1994
<S> <C> <C>
Total Tangible Assets ............................................................ $12.7 $11.3
Goodwill at Cost ................................................................. 4.6 4.6
----- -----
Total Assets Before Goodwill Amortization ...................................... 17.3 15.9
Less: Accumulated Goodwill Amortization ...................................... .8 0.8
----- -----
Total Assets .............................................................. $16.5 $15.1
===== =====
Total Debt ....................................................................... $ 7.0 $ 5.0
Stockholder's Equity ............................................................. 9.5 10.1
----- -----
Total Capitalization .......................................................... $16.5 $15.1
===== =====
Debt to Total Capitalization ..................................................... 42% 33%
</TABLE>
<PAGE>
NACCO AND OTHER
FINANCIAL REVIEW
Second Quarter of 1995 Compared with Second Quarter of 1994
The following schedule details the components of the changes in parent company
operating loss and net loss for the second quarter of 1995 compared with 1994:
<TABLE>
<CAPTION>
Operating Net
Loss Loss
<S> <C> <C>
1994 $ (2.2) $ (1.6)
Administrative and general expenses .............................................. .1 .1
Interest income .................................................................. .5
Consolidating and other tax adjustments .......................................... .7
----- ----
1995 $ (2.1) $ (.3)
====== =====
</TABLE>
The favorable impact from interest income and tax adjustments is primarily due
to the recognition of an income tax refund of approximately $0.4 million (net of
$0.3 million in taxes on interest income) and related interest income of
approximately $0.9 million resulting from prior tax years.
First Six Months of 1995 Compared With First Six Months of 1994
The following schedule details the components of the changes in parent company
operating loss and net loss for the first six months of 1995 compared with 1994:
<TABLE>
<CAPTION>
Operating Net
Loss Loss
<S> <C> <C>
1994 $ (4.4) $ (3.6)
Administrative and general expenses ............................................ .2 .2
Interest income ................................................................ .4
Interest expense ............................................................... (.1)
Other-net ...................................................................... (.1)
Consolidating and other tax adjustments ........................................ 1.3
--- ---
1995 $ (4.2) $ (1.9)
==== ====
</TABLE>
The favorable impact from interest income and tax adjustments is primarily due
to the recognition of an income tax refund and related interest income resulting
from prior tax years.
<PAGE>
NACCO AND OTHER - continued
LIQUIDITY AND CAPITAL RESOURCES
Although the subsidiaries have entered into substantial debt agreements, NACCO
has not guaranteed the long-term debt or any borrowings of its subsidiaries.
The debt agreements at HB/PS and KCI allow for the payment of dividends under
certain circumstances. The revised credit agreement entered into on February 28,
1995 at NMHG will allow the transfer of up to $25.0 million to NACCO.
There are no restrictions for North American Coal, and its dividends and
advances are the primary source of cash for NACCO.
The Company believes it can adequately meet all of its current and long-term
commitments and operating needs. This outlook is supported by the amounts
available under revolving credit facilities and the utility customers' funding
of the project mining subsidiaries.
BELLAIRE CORPORATION
Bellaire Corporation ("Bellaire") is a non-operating subsidiary of NACCO.
Bellaire's results primarily include mine closing activities related to the
Indian Head Mine, which ceased mining operations in April 1992. Bellaire's
results for 1994 have been adjusted to remove certain royalty and other payments
that are more appropriately classified with North American Coal's results. Cash
payments related to Bellaire's obligations, net of internally generated cash,
are funded by NACCO and amounted to $2.0 million and $2.2 million during the
first six months of 1995 and 1994, respectively.
For the second quarter ended June 30, 1995 Bellaire had revenues of $0.3 million
and an operating loss of $52,000 compared with revenues of $0.2 million and an
operating loss of $34,000 in 1994. Bellaire's net income in the second quarter
of 1995 and 1994 is $0.4 million and $0.1 million, respectively.
For the first six months of 1995 Bellaire had revenues of $0.3 million,
operating loss of $62,000 and net income of $0.6 million compared with revenues
of $0.4 million, operating loss of $35,000 and net income of $0.3 million in
1994.
<PAGE>
NACCO AND OTHER - continued
BELLAIRE CORPORATION - continued
The condensed balance sheets for Bellaire were as follows:
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1995 1994
<S> <C> <C>
Net current assets ........................................................... $ 14.0 $ 13.1
Property, plant and equipment, net ........................................... .5 .5
Deferred taxes and other assets .............................................. 63.3 64.1
Obligation to United Mine Workers of
America Combined Benefit Fund ............................................. (153.1) (155.0)
Other liabilities ............................................................ (25.5) (24.0)
------- -------
Deficit ...................................................................... $(100.8) $(101.3)
======= =======
</TABLE>
<PAGE>
Part II
Item 1 Legal Proceedings
None
Item 2 Change in Securities
None
Item 3 Defaults Upon Senior Securities
None
Item 4 Submission of Matters to a Vote of Security Holders
The following matters were submitted to a vote of security
holders at the Annual Meeting of Stockholders held May 10, 1995,
with the results indicated:
Outstanding Shares Entitled to Vote Number of Votes
7,244,500 Class A Common 7,244,500
1,719,694 Class B Common 17,196,940
24,441,440
Item 1. Election of eleven directors for the ensuring year.
Votes
Director Nominee For Withheld Total
Owsley Brown II 22,041,847 502,411 22,544,258
John J. Dwyer 22,512,754 31,504 22,544,258
Robert M. Gates 22,519,186 25,072 22,544,258
Leon J. Hendrix, Jr. 22,517,388 26,870 22,544,258
Dennis W. LaBarre 22,468,888 75,370 22,544,258
Alfred M. Rankin, Jr. 22,521,824 22,434 22,544,258
Ian M. Ross 22,517,464 26,794 22,544,258
John C. Sawhill 22,521,824 22,434 22,544,258
Britton T. Taplin 22,489,973 54,285 22,544,258
Frank E. Taplin, Jr. 22,293,124 251,134 22,544,258
Item 2. Confirming the appointment of Arthur Andersen &
Co. as the independent certified public
accountants of the Company for the current fiscal
year.
For Against Abstain Total
22,529,818 2,599 11,841 22,544,258
Item 3. Authority to vote on other matters that may
properly come before the meeting.
For Against Total
22,542,608 1,650 22,544,258
Item 5 Other Information
None
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits. See Exhibit Index on page 33 of this
quarterly report on Form 10-Q.
<PAGE>
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NACCO Industries, Inc.
(Registrant)
Date August 14, 1995 Frank B. O'Brien
Frank B. O'Brien
Senior Vice President - Corporate
Development and Chief Financial
Officer
Date August 14,1995 Steven M. Billick
Steven M. Billick
Vice President and Controller
(Principal Accounting Officer)
<PAGE>
Exhibit Index
Exhibit
Number** Description of Exhibit
(10) * (clxviii) Amendment No. 5 to the North American Coal
Deferred Compensation Plan for Management Employees,
dated June 30, 1995, is attached hereto as Exhibit
10(clxviii).
* (clxiv) Amendment No. 2 to the Hamilton
Beach/Proctor-Silex Unfunded Benefit Plan, date June
30, 1995, is attached hereto as Exhibit 10 (clxiv).
* (clxx) Amendment No. 3 to the NACCO Materials Handling
Group, Inc. Unfunded Benefit Plan (as amended and restated
effective October 1, 1994), dated June 30, 1995, is
attached hereto as Exhibit 10 (clxx).
* (clxxi) Amendment No. 2 to the Retirement Benefit Plan
for Alfred M. Rankin, Jr. (as amended and restated
effective January 1, 1994), dated June 30, 1995, is
attached hereto as Exhibit (clxxi)
* (clxxii) Amendment No. 4 to the North American Coal
Corporation Retirement Savings Plan, dated June 30, 1995,
is attached hereto as Exhibit 10 (clxxii).
* (clxxiii) Amendment No. 6 to the NACCO Materials
Handling Group, Inc. Profit Sharing Plan, dated June 30,
1995, is attached hereto as Exhibit 10 (clxxiii).
* (clxxiv) Amendment No. 4 to the NACCO Materials
Handling Group, Inc. Cash Balance Plan, dated as of
June 30, 1995, is attached hereto as Exhibit 10 (clxxiv).
* (clxxv) Master Trust Agreement by and between NACCO
Industries, Inc. and Vanguard Fiduciary Trust Company,
effective as of June 30, 1995, is attached hereto as
Exhibit 10 (clxxv).
* (clxxvi) Amendment No. 1 to the Hamilton
Beach/Proctor-Silex Retirement Savings Plan, effective
as of July 1, 1995, is attached hereto as Exhibit 10
(clxxvi).
(11) Computation of Earnings Per Common Share
(27) Financial Data Schedule
* Management Contract or compensation plan or arrangement
required to be filed as an exhibit pursuant to Item 6a of
this Quarterly Report on Form 10-Q.
** Numbered in accordance with Item 601 of Regulation S-K.
Exhibit 10 (clxviii)
AMENDMENT NO. 5
TO THE
NORTH AMERICAN COAL CORPORATION DEFERRED COMPENSATION PLAN
FOR MANAGEMENT EMPLOYEES
The North American Coal Corporation hereby adopts this Amendment No. 5
to The North American Coal Corporation Deferred Compensation Plan for Management
Employees (the "Plan"), effective as of January 1, 1995. Words and phrases used
herein with initial capital letters which are defined in the Plan are used
herein as so defined.
Section 1
A new Section 8(e) is hereby added to the Plan, immediately following
Section 8(d), to read as follows:
"(e) Limitation on Earnings Assumption.
Notwithstanding any provision of the Plan to the contrary, in no event will the
earnings rate credited to the Accounts hereunder exceed 14%."
EXECUTED this 30th day of June,
1995.
THE NORTH AMERICAN
COAL CORPORATION
By: Charles A. Bittenbender
Title: Assistant Secretary
Exhibit 10(clxiv)
AMENDMENT NO. 2
TO THE
HAMILTON BEACH/PROCTOR-SILEX, INC.
UNFUNDED BENEFIT PLAN
(As Amended and Restated Effective January 1, 1995)
Hamilton Beach/Proctor-Silex, Inc. hereby adopts this Amendment No. 2 to
the Hamilton Beach/Proctor-Silex, Inc. Unfunded Benefit Plan (the "Plan").
Except as specifically provided herein, the provisions of this Amendment shall
be effective July 1, 1995. Words and phrases used herein with initial capital
letters which are defined in the Plan are used herein as so defined.
Section 1
Section 1.2(b) of the Plan is hereby amended by deleting the phrase
"Section 402(g)" and replacing it with the phrase "Section 402(g), 401(m)."
Section 2
Section 2.1 of the Plan is hereby amended in its entirety to read as
follows:
"SECTION 2.1. Account shall mean the record maintained in accordance with
Section 3.2 by the Company as the sum of the Participant's Excess 401(k)
Sub-Account and Excess Matching Sub-Account."
Section 3
Section 2.7 of the Plan is hereby amended by adding the phrase "and an
Excess Matching Benefit" after the phrase "an Excess 401(k) Benefit" therein.
Section 4
Section 2.10(b)(i) of the Plan is hereby amended in its entirety to read as
follows:
"(i) who is unable to make all of the Before-Tax Contributions that he
has elected to make to the Savings Plan, or who is unable to receive
the maximum amount of Post-1994 Matching Employer Contributions under
the Savings Plan, because of the limitations imposed under Code
Sections 402(g), 401(a)(17), 401(k)(3) or 401(m)."
Section 5
A new Section 3.2A is hereby added to the Plan, immediately following
Section 3.2, to read as follows:
"SECTION 3.2A. Excess Matching Benefits
(a) In General. A 401(k) Participant shall have credited to his Excess
Matching Sub-Account an amount equal to the Post-1994 Matching Employer
Contributions that he is prevented from receiving under the Savings Plan because
of the limitations imposed under Code Sections 401(g), 401(a)(17), 401(k)(3) and
401(m) (collectively, the "Excess Matching Benefits").
(b) Time of Payment. The Excess Matching Benefits, to the extent vested,
shall be paid (or commence to be paid) at the time specified in the Deferral
Election Form for payment of the Excess 401(k) Benefits to which the Excess
Matching Benefits relate."
Section 6
Section 3.3(a) of the Plan is hereby amended by adding the following phrase
to the end thereof: "and credits to an Excess Matching Sub-Account for the
Excess Matching Benefits described in Section 3.2A, which shall be credited to
the Sub-Account when a Participant is prevented from receiving Post-1994
Matching Employer Contributions under the Savings Plan."
Section 7
Sections 3.3(b) and (c) of the Plan are hereby amended by deleting the term
"Sub-Account" and replacing it with the term "Sub-Accounts" each time it appears
therein.
Section 8
Sections 4.1 and 4.2 of the Plan are hereby amended in their entirety to
read as follows:
"SECTION 4.1. For Active 401(K) Employees.
(a) For purposes of determining the earnings to be credited to a 401(k)
Employee's Account, such Account shall be divided into two additional
Sub-Accounts, the "7% Sub-Account" and the "Additional Sub-Account." The 7%
Sub-Account shall contain Excess 401(k) Benefits and Excess Matching Benefits
attributable to amounts deferred by a 401(k) Employee of up to 7% of his
Compensation, plus any earnings attributable thereto. The Additional Sub-Account
shall contain the Excess 401(k) Benefits and Excess Matching Benefits
attributable to amounts deferred by a 401(k) Employee in excess of 7% of his
Compensation, plus any earnings attributable thereto.
(b) At the end of each calendar month during a Plan Year, the 7%
Sub-Account of each 401(k) Employee who is employed by an Employer on December
31 of a Plan Year shall be credited with an amount determined by multiplying
such Participant's average 7% Sub-Account balance during such month by the
blended rate earned during such month by the Fixed Income Fund. Notwithstanding
the foregoing, in the event that the Adjusted ROE determined for such Plan Year
exceeds the rate credited to the Participant's 7% Sub-Account under the
preceding sentence, the Participant's 7% Sub-Account shall retroactively be
credited with the difference between (i) the amount determined under the
preceding sentence, and (ii) the amount determined by multiplying the
Participant's average 7% Sub-Account balance during each month of such Plan Year
by the Adjusted ROE determined for such Plan Year, compounded monthly.
(c) At the end of each calendar month during a Plan Year, the Additional
Sub-Account of each Participant who is employed by an Employer on December 31 of
such Year shall be credited with an amount determined by multiplying such
Participant's average Additional Sub-Account balance during such month by the
blended rate earned during such month by the Fixed Income Fund.
SECTION 4.2. For Terminated Employees. The Sub-Accounts of a Participant
who has terminated employment with the Controlled Group shall be credited with
earnings as described in Section 4.1, as modified by this Section 4.2, until
each Sub-Account has been distributed in full. The Adjusted ROE calculation
described in the second sentence of Section 4.1(b) shall be made during the
month in which the Participant terminates employment and shall be based on the
year-to-date Adjusted ROE for the month ending prior to the date the Participant
terminated employment, as calculated by the Company. For any subsequent month,
the Adjusted ROE calculation described in the second sentence of Section 4.1(b)
shall not apply. The Fixed Income Fund calculation described in the first
sentence of Section 4.1(b) and in Section 4.1(c) for the month in which the
Participant receives a distribution from his Sub-Account shall be based on the
blended rate earned during the preceding month by the Fixed Income Fund."
Section 9
Effective as of January 1, 1995, a new Section 4.4 is hereby added to the
Plan, immediately following Section 4.3, to read as follows:
"Section 4.4. Limitation on Earnings Assumption. Notwithstanding any
provision of the Plan to the contrary, in no event will the earnings rate
credited to Accounts hereunder exceed 14%."
Section 10
The first sentence of Article V of the Plan is hereby amended in its
entirety to read as follows:
"A Participant shall not become vested in his Excess Pension Benefit or
Excess Matching Benefit until he becomes vested in the Company-provided
benefit under the Cash Balance Plan or Savings Plan (as applicable) and
the Excess Pension Benefit or Excess Matching Benefit of a Participant
who is partially or fully vested under the Cash Balance Plan or Savings
Plan, respectively, shall at all times be vested hereunder to the
extent he is so vested."
Section 11
Section 6.1(b) of the Plan is hereby amended by (1) changing the title to
read as follows: "(b) Excess 401(k) and Matching Benefits", and (2) deleting the
phrase "Excess 401(k) Benefit" each time it appears therein and replacing it
with the term "Account."
Section 12
The second sentence of Section 7.1 of the Plan is hereby amended in its
entirety to read as follows:
"In the absence of such a designation and at any other time when there
is no existing Beneficiary designated hereunder, the Beneficiary of a
Participant for his Excess Pension Benefits and/or his Account shall be
his Beneficiary under the Cash Balance Plan and the Savings Plan,
respectively."
Section 13
Section 7.3(a)(ii) of the Plan is hereby amended in its entirety to read as
follows:
"(ii) Amount of Excess 401(k) and Matching Benefits. The Excess 401(k)
and Excess Matching Benefits payable to a Participant's Beneficiary
under this Plan shall be equal to such Participant's Account balance on
the date of the distribution of the Account to the Beneficiary."
Section 14
Section 7.3(b)(ii) of the Plan is hereby amended in its entirety to read as
follows:
"(ii) Excess 401(k) and Matching Benefits. The Excess 401(k) and Excess
Matching Benefits payable to a Beneficiary under this Plan shall be
paid as soon as practicable following the death of a Participant in the
form of a lump sum payment."
Executed this 30th day of June, 1995.
HAMILTON BEACH/PROCTOR-SILEX, INC.
By: Charles A. Bittenbender
Title: Assistant Secretary
Exhibit 10(clxx)
AMENDMENT NO. 3
TO THE
NACCO MATERIALS HANDLING GROUP, INC.
UNFUNDED BENEFIT PLAN
(As Amended and Restated Effective October 1, 1994)
NACCO Materials Handling Group, Inc. hereby adopts this Amendment No. 3 to
the NACCO Materials Handling Group, Inc. Unfunded Benefit Plan (the "Plan"). The
provisions of this Amendment shall be effective as of the dates indicated
herein. Words and phrases used herein with initial capital letters which are
defined in the Plan are used herein as so defined.
Section 1
Effective as of January 1, 1995, Section 2.2 of the Plan is hereby amended
in its entirety to read as follows:
"SECTION 2.2. Adjusted ROE.
(a) For purposes of this Section, the following terms shall have the
following meanings:
(i) "Net Income (before extraordinary items)" is defined as consolidated
net income, as defined by general accepted accounting principles ("GAAP"), for
the Company or NACCO Industries, Inc. and its subsidiaries, as applicable for
the subject year before extraordinary items, but including any extraordinary
items related to refinancings (net of tax);
(ii) "Amortization of Goodwill" is defined as the consolidated amortization
expense related to the intangible asset goodwill for the Company or NACCO
Industries, Inc. and its subsidiaries, as applicable for the subject year;
(iii) "Weighted Average Stockholders' Equity" is calculated by adding the
consolidated stockholders' equity for the Company or NACCO Industries, Inc., as
applicable, as defined by GAAP, at the beginning of the subject year and the end
of each month of the subject year and dividing by thirteen;
(iv) "Weighted Average Accumulated Amortization of Goodwill" is calculated
by adding consolidated accumulated amortization of goodwill, as defined by GAAP,
at the beginning of the subject year and the end of each month of the subject
year and dividing by thirteen; and
(v) "Weighted Average UMWA Adjustment" is calculated by adding the balance
in the Obligation to United Mine Workers of America Combined Benefit Fund, net
of tax, for NACCO Industries, Inc. at the beginning of the subject year and the
end of each month of the subject year and dividing by thirteen. (b) For Profit
Sharing Employees who are Employees of NACCO Industries, Inc. and for NACCO
401(k) Employees, "Adjusted ROE" shall mean the average return on equity of
NACCO Industries, Inc. calculated for the applicable time period, based on A
divided by B, where:
A = Net Income (before extraordinary items) + Amortization of Goodwill; and
B = Weighted Average (Stockholders' Equity + Accumulated Amortization of
Goodwill + UMWA Adjustment).
(c) For all other Participants, "Adjusted ROE" shall mean the
average return on equity of the Company calculated for the applicable time
period, based on A divided by B, where:
A = Net Income (before extraordinary items) + Amortization of Goodwill; and
B = Weighted Average (Stockholders' Equity + Accumulated Amortization of
Goodwill).
(d) Adjusted ROE shall be determined at least annually by the
Employers."
Section 2
Effective as of January 1, 1995, a new Section 2.12A is hereby added to the
Plan, immediately following Section 2.12, to read as follows:
"SECTION 2.12A. Fixed Income Fund shall mean the Stable Asset Fund under
the NACCO Materials Handling Group, Inc. Profit Sharing Plan or any equivalent
fixed income fund thereunder which is designated by the NACCO Industries, Inc.
Retirement Funds Investment Committee as the successor to the Stable Asset
Fund."
Section 3
Effective as of January 1, 1995, Article IV of the Plan is hereby amended
by deleting the phrase "Stable Asset Fund" and replacing it with the phrase
"Fixed Income Fund" each time it appears therein.
Section 4
Effective as of January 1, 1995, a new Section 4.4 is hereby added to the
Plan, immediately following section 4.3, to read as follows:
"SECTION 4.4. Limitation on Earnings Assumption. Notwithstanding any
provision of the Plan to the contrary, in no event will the earnings rate
credited to Accounts hereunder exceed 14%."
Section 5
Effective July 1, 1995, a new Section 4.5 is hereby added to the Plan,
immediately following Section 4.4, to read as follows:
"SECTION 4.5. Changes in Earnings Assumption. The Nominating, Organization
and Compensation Committee of the Board of Directors of the Company may change
the earnings rate credited on Accounts hereunder at any time upon at least 30
days advance notice to Participants."
Executed this 30th day of June, 1995.
NACCO MATERIALS HANDLING GROUP, INC.
By: Charles A. Bittenbender
Title: Assistant Secretary
Exhibit 10(clxxi)
AMENDMENT NO. 2
TO THE
RETIREMENT BENEFIT PLAN FOR
ALFRED M. RANKIN, JR.
(As Amended and Restated Effective January 1, 1994)
NACCO Industries, Inc. hereby adopts this Amendment No. 1 to The Retirement
Benefit Plan for Alfred M. Rankin, Jr. (the "Plan"), effective as of January 1,
1995. Words and phrases used herein with initial capital letters which are
defined in the Plan are used herein as so defined.
Section 1
A new Section 3.4(e) is hereby added to the Plan, immediately following
Section 3.4(d), to read as follows:
"(e) Limitation on Earnings Assumption. Notwithstanding any provision of
the Plan to the contrary, in no event will the earnings rate credited to the
Participant's Account hereunder exceed 14%."
EXECUTED this 30th day of June, 1995.
NACCO INDUSTRIES, INC.
By: Charles A. Bittenbender
Title: Vice President, General Counsel
and Secretary
The undersigned Alfred M. Rankin, Jr. hereby agrees to the terms of this
Amendment and, in particular, the retroactive effect for the 1995 calendar year
of the limitation on the earnings assumption.
Date: August 3, 1995 Alfred M. Rankin, Jr.
Alfred M. Rankin, Jr.
Exhibit 10(clxxii)
AMENDMENT NO. 4
TO
THE NORTH AMERICAN COAL CORPORATION RETIREMENT SAVINGS PLAN
The North American Coal Corporation hereby adopts this Amendment No. 4 to
The North American Coal Corporation Retirement Savings Plan (As Amended and
Restated Effective as of January 1 1993) (the "Plan"). Except as specifically
stated herein, the provisions of this Amendment shall be effective June 30,
1995. Words and phrases used herein with initial capital letters which are
defined in the Plan are used herein as so defined.
Section 1
Section 1.1(35) of the Plan is hereby amended in its entirety to read as
follows:
"(35) Trustee: Any bank that is a custodian or trustee and
that is appointed to hold and administer some or all of the
assets of the Plan pursuant to Article VII hereof."
Section 2
Section 1.1(36) of the Plan is hereby amended in its entirety to read as
follows:
"(36) Trust Agreement: Any agreement between the Company and a
Trustee. All or a portion of the assets of the Plan may be
held in a master trust arrangement with the assets of the
other qualified defined contribution plans of the controlled
group."
Section 3
Section 1.1(38) of the Plan is hereby amended in its entirety to read as
follows:
"(38) Valuation Date: Each day on which the New York Stock
Exchange is open for trading."
Section 4
Effective as of January 1, 1995, Section 4.6(1)(a) of the Plan is hereby
amended by deleting the phrase "(or, if greater, one-fourth of the dollar
limitation in effect under Code Section 415(b)(1)(A))" and replacing it with the
phrase "(as adjusted pursuant to Code Section 415(d))."
Section 5
The third sentence of Section 4.6(4) of the Plan is hereby amended in its
entirety to read as follows:
"Investment gains and losses shall be allocated to the
suspense account during the period such suspense account is
required to be maintained pursuant to this Subsection."
Section 6
The first sentence of Section 5.3 of the Plan is hereby amended in its
entirety to read as follows:
"Each Participant shall, in accordance with rules and
procedures established by the Administrative Committee for
this purpose, direct that After-Tax Contributions, Before-Tax
Contributions, Matching Contributions and repayments of a loan
made by or for him be invested in such of the Investment Funds
as the Participant shall select."
<PAGE>
Section 7
The first sentence of Section 5.5 of the Plan is hereby amended in its
entirety to read as follows:
"An investment option provided for in Section 5.3 and an
investment change provided for in Section 5.4 shall be made in
accordance with rules and procedures adopted by the
Administrative Committee for this purpose."
Section 8
Section 6.3(1) of the Plan is hereby amended by deleting the phrase "valued
as of the Valuation Date" in the first sentence thereof and replacing it with
the phrase "valued on the Valuation Date."
Section 9
Section 6.3(2) of the Plan is hereby amended in its entirety to read as
follows:
"(2) Distributions pursuant to this Section shall be paid (or
commence to be paid) to a Participant and shall be valued on
the Valuation Date that authorized distribution instructions
are received by the Trustee from the Administrative Committee,
following the Participant's termination of employment and
filing of an application pursuant to Section 6.1."
Section 10
Section 6.3(3)(a) of the Plan is hereby amended by deleting the phrase
"shall be paid to him in a lump sum payment in cash as soon as practicable after
the Valuation Date coinciding with or next following his termination of
employment" and replacing it with the phrase ", valued on the Valuation Date
that authorized distribution instructions are received by the Trustee from the
Administrative Committee, shall be paid to him in a lump sum payment in cash as
soon as practicable following the Participant's termination of employment."
Section 11
The first sentence of Section 6.6 of the Plan is hereby amended by deleting
the phrase "effective as of the first day of the month following notification of
the Trustee by the Administrative Committee" and replacing it with the phrase
"effective as of the Valuation Date that authorized distribution instructions
are received by the Trustee from the Administrative Committee."
Section 12
Effective as of January 1, 1994, the first sentence of Section 8.11 of the
Plan is hereby amended in its entirety to read as follows:
"NACCO Industries, Inc. has established a "Retirement Funds
Investment Committee" (the "Investment Committee") pursuant to
the terms of an Instrument of Creation and Delegation dated
October 28, 1992 (as amended)."
EXECUTED this 30th day of June, 1995, to be effective as of the dates
indicated above.
THE NORTH AMERICAN COAL CORPORATION
By: Charles A. Bittenbender
Title: Assistant Secretary
Exhibit 10(clxxiii)
AMENDMENT NO. 6
TO THE
NACCO MATERIALS HANDLING GROUP, INC. PROFIT SHARING PLAN
NACCO Materials Handling Group, Inc. hereby adopts this Amendment No. 6 to
the NACCO Materials Handling Group, Inc. Profit Sharing Plan (as amended and
restated effective November 1, 1992) (the "Plan"). Except as specifically
provided herein, the provisions of this Amendment shall be effective June 30,
1995. Words and phrases used herein with initial capital letters which are
defined in the Plan are used herein as so defined.
Section 1
Section 1.1(47) of the Plan is hereby amended by adding the following
sentence to the end thereof:
"All or a portion of the assets of the Plan may be invested under a
master trust arrangement with the assets of the other qualified
defined contribution plans of the Controlled Group."
Section 2
Effective as of January 1, 1995, Section 4.8(1) of the Plan is hereby
amended by deleting the phrase "(or, if greater, one-fourth of the dollar
limitation in effect under Code Section 415(b)(1)(A)) and replacing it with the
phrase (as adjusted pursuant to Code Section 415(d))."
Section 3
The third sentence of Section 5.5(2) of the Plan is hereby amended in its
entirety to read as follows:
"The transfer of funds between Investment Funds shall occur as of the
Valuation Date that authorized transfer instructions are received by
the Trustee."
Section 4
Section 6.2(1) of the Plan is hereby amended by deleting the phrase "valued
as of the last Valuation Date of the month in which his Beneficiary files an
application with the Administrative Committee pursuant to Section 6.1" and
replacing it with the phrase "valued as of the Valuation Date that authorized
distribution instructions are received by the Trustee from the Plan
Administrator following the Beneficiary's filing of an application with the
Administrative Committee pursuant to Section 6.1."
Section 5
Section 6.2(3) of the Plan is hereby amended by deleting the phrase "valued
as of the last Valuation Date of the month in which the Beneficiary dies" and
replacing it with the phrase "valued as of the Valuation Date that authorized
distribution instructions are received by the Trustee from the Plan
Administrator (which shall occur during the month in which the Plan
Administrator is made aware of the Beneficiary's death)."
Section 6
Section 6.3(2) of the Plan is hereby amended in its entirety to read as
follows:
"(2) Distributions pursuant to this Section shall be paid or commence
to be paid to a Participant and shall be valued as of the Valuation
Date that authorized distribution instructions are received by the
Trustee from the Plan Administrator, following the Participant's
Termination of Employment and filing of an application pursuant to
Section 6.1."
<PAGE>
Section 7
The last sentence of Section 6.5 of the Plan is hereby amended by deleting
the phrase "the last Valuation Date of the month coincident with or next
following the date specified in such order" and replacing it with the phrase
"the Valuation Date specified in such order."
Section 8
Section 6.9(3) of the Plan is hereby amended in its entirety to read as
follows:
"(3) All distributions and withdrawals hereunder shall be valued as of
the Valuation Date that authorized distribution instructions are
received by the Trustee from the Plan Administrator."
Section 9
Section 6.10(1) of the Plan is hereby amended by adding the following
sentence after the first sentence thereof:
"Loans made hereunder shall be subject to an origination fee and an
annual maintenance fee in an amount determined by the Administrative
Committee."
Section 6.10(4)d)(v)(B) is hereby amended by deleting the
phrase "(or in $1,000 increments)" and replacing it with the phrase "(or in
part, with a minimum partial payment of $1,000)."
Executed this 30th day of June, 1995.
NACCO MATERIALS HANDLING GROUP, INC.
By: Charles A. Bittenbender
Assistant Secretary
Exhibit 10 (clxxiv)
AMENDMENT NO. 4
TO THE
NACCO MATERIALS HANDLING GROUP, INC.
CASH BALANCE PLAN
NACCO Materials Handling Group, Inc. hereby adopts this Amendment No. 4
to the Plan document entitled "The NACCO Materials Handling Group, Inc. Cash
Balance Plan (As Amended and Restated Effective as of April 1, 1992)" (the
"Plan"). The provisions of this Amendment shall be effective July 1, 1995. Words
and phrases used herein with initial capital letters which are defined in the
Plan are used herein as so defined.
Section 1
The third sentence of Section 6.05(b) of the Plan (which was previously
amended by Amendment No. 1 to the Plan) is hereby amended in its entirety to
read as follows:
"If a Participant's Disability Retirement Pension commences before his
Normal Retirement Date, it shall be payable, except as otherwise
provided in the Plan, for the Participant's lifetime, in a reduced
monthly amount equal to the greater of (1) or (2), where (1) equals the
Actuarial Equivalent of his Accrued Benefit sum of (A) his Immediate
Cash Balance Annuity, based on the Participant's Cash Balance Account
as of his Pension Commencement Date, plus (B) the Actuarial Equivalent
of his Indexed Prior Plan Benefit."
EXECUTED this 30th day of June, 1995.
NACCO MATERIALS HANDLING GROUP, INC.
By: Charles A. Bittenbender
Title: Assistant Secretary
Exhibit 10(clxxv)
M A S T E R T R U S T A G R E E M E N T
THIS AGREEMENT OF TRUST (the "Agreement") effective the 30th day of
June, 1995, by and between NACCO INDUSTRIES, INC., a Delaware corporation (the
"Company"), and VANGUARD FIDUCIARY TRUST COMPANY, a trust company incorporated
under Chapter 10 of the Pennsylvania Banking Code (the "Trustee"),
WITNESSETH
WHEREAS, certain wholly-owned subsidiaries of the Company (the
"Subsidiaries") maintain the tax-qualified employee benefit plans identified on
Exhibit A hereto for the exclusive benefit of certain employees (such plans
being referred to herein individually as a "Plan" and collectively as the
"Plans");
WHEREAS, the authority to conduct the general operation and
administration of each of the Plans is vested in the Administrative Committee
(or Committees) appointed under each such Plan, which Committees shall have the
authorities specified in the applicable Plan (or portion thereof, as applicable)
and in this Trust Agreement;
WHEREAS, each such Administrative Committee (collectively, the "Plan
Administrator") shall only have authority with respect to the Plan (or portion
thereof, as applicable) under which it has been appointed;
WHEREAS, the Company previously established the Master Trust between
NACCO INDUSTRIES, INC. and STATE STREET BANK AND TRUST COMPANY (dated October 1,
1992) (the "State Street Trust") as the funding medium and governing trust
instrument for the Plans;
WHEREAS, the Company and the Trustee desire to amend and restate the
State Street Trust into the form of this written agreement of trust, which
agreement shall also constitute a master trust.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto, intending to be legally bound, hereby agree and
declare as follows:
ARTICLE I
ESTABLISHMENT OF THE TRUST
Section 1.1. The Company and the Trustee hereby agree to the
establishment of a trust consisting of such sums of money and other property as
shall from time to time be paid to the Trustee under the Plans and such
earnings, income and appreciation as may accrue thereon, which, less losses,
taxes, compensation and expenses paid in accordance with Article VI and any
payments made by the Trustee to carry out the purposes of the Plans, are
referred to herein as the "Fund". The Trustee shall carry out the duties and
responsibilities herein specified, but shall be under no duty to determine
whether the amount of any contribution by the Company or the Subsidiaries
(collectively, the "Employers") is in accordance with the terms of the Plans nor
shall the Trustee be responsible for the collection of any contributions
required under the Plans.
Section 1.2. The Fund shall be held, invested, reinvested and
administered by the Trustee in accordance with the terms of the Plans and this
Agreement solely in the interest of Participants and their Beneficiaries and for
the exclusive purpose of providing benefits to Participants and their
Beneficiaries and defraying reasonable expenses of administering the Plans.
Except as provided in Section 4.2, no assets of the Plans shall inure to the
benefit of the Employers.
Section 1.3. The Trustee shall pay benefits and expenses from the Fund
only upon the written direction of the Plan Administrator. The Trustee shall be
fully entitled to rely on such directions furnished by the Plan Administrator,
and shall be under no duty to ascertain whether the directions are in accordance
with the provisions of the Plans.
Section 1.4. The Fund is a master trust fund which holds the assets of
more than one qualified plan of the Employers. The Fund shall be subdivided into
sub-trusts to account for each Plan's interest in the Fund. In furtherance
thereof, all transfers to, withdrawals from, and other transactions regarding
the Fund shall be conducted in such a way that the proportionate interest in the
Fund of each Plan and the fair market value of that interest may be determined
at any time. Whenever the assets of more than one Plan are commingled in the
Fund or in any Investment Fund (as defined in Article II), the undivided
interest therein of that Plan shall be debited or credited (as the case may be)
(i) for the entire amount of every contribution received on behalf of that plan,
every benefit payment or other expense attributable solely to that Plan; and
(ii) for its proportionate share of every item collected or accrued income, gain
or loss, and general expense, and other transactions attributable to the Fund or
that Investment Fund as a whole. As of each date when the fair market value of
the investments held in the Fund or an Investment Fund are determined, the
Trustee shall adjust the value of each Plan's interest therein the reflect the
net increase or decrease in such values since such last day.
ARTICLE II
INVESTMENT OF THE FUND
Section 2.1. The NACCO Industries, Inc. Retirement Funds Investment
Committee (the "Investment Committee") shall direct the Trustee to establish one
or more separate investment accounts within the Fund, each separate account
being hereinafter referred to as an "Investment Fund". In accordance with
Section 1.4 hereof, each Plan's interest in each Investment Fund shall be
separately accounted for.
In the absence of the existence of an Investment Committee, all
Investment Committee actions under this Agreement shall be taken by the Company.
The Trustee shall transfer to each such Investment Fund such portion of the
assets of the Fund as the Plan Administrator directs in accordance with the
specific provisions of each Plan. All interest, dividends and other income
received with respect to, and any proceeds received from the sale or other
disposition of, securities or other property held in an Investment Fund shall be
credited to and reinvested in such Investment Fund. All expenses of the Fund
which are allocable to a particular Investment fund shall be so allocated and
charged. The Investment Committee shall notify the Trustee in writing of the
selection of the Investment Funds currently available for investment under the
Plans, and any changes thereto.
Section 2.2. Each Participant shall have the exclusive right, in
accordance with the provisions of the Plans, to direct the investment by the
Trustee of all amounts allocated to the separate accounts of the Participant
under the Plans among any one or more of the available Investment Funds. All
investment directions by Participants shall be timely furnished to the Trustee
by the Plan Administrator, except to the extent such directions are transmitted
telephonically or otherwise by Participants directly to the Trustee or its
delegate in accordance with rules and procedures established and approved by the
Plan Administrator and communicated to the Trustee.
Section 2.3. In making any investment of the assets of the Fund, the
Trustee shall be fully entitled to rely on such directions furnished to it by
the Plan Administrator or by Participants in accordance with the Plan
Administrator's approved rules and procedures, and shall be under no duty to
make any inquiry or investigation with respect thereto. If the Trustee receives
any contribution under a Plan that is not accompanied by instructions directing
its investment, the Trustee shall immediately notify the appropriate Plan
Administrator of that fact, and the Trustee may, in its discretion, hold or
return all or a portion of the contribution uninvested without liability for
loss of income or appreciation pending receipt of proper investment directions.
Otherwise, it is specifically intended under the Plans and this Agreement that
the Trustee shall have no discretionary authority to determine the investment of
the assets of the Fund.
Section 2.4. To the extent specifically authorized by the Plans, the
Investment Committee may direct the Trustee to establish one or more Investment
Funds all of the assets of which shall be invested in securities which
constitute "qualifying employer securities" or "qualifying employer real
property" within the meaning of Section 407 of ERISA. It shall be the duty of
the Investment Committee to determine that such investment is not prohibited by
Section 406 or 407 of ERISA.
Section 2.5. Investment Manager Appointment. The Investment committee,
from time to time and in accordance with the provisions of the Plans, may
appoint one or more independent Investment Managers, pursuant to a written
investment management agreement describing the powers and duties of the
Investment Manager, to direct the investment and reinvestment of all or a
portion of the Trust Fund or an Investment fund (hereinafter referred to as an
"Investment Account").
The Investment Committee shall be responsible for ascertaining that
while each Investment Manager is acting in that capacity hereunder, the
following requirements are satisfied:
(a) The Investment Manager is either (I) registered as an
investment adviser under the Investment Advisers Act of 1940, as
amended, (ii) a bank as defined in that Act or (iii) an insurance
company qualified to perform the services described in (b) below under
the laws or more than one state.
(b) The Investment Manager has the power to manage, acquire
or dispose of any assets of the Plans for which it is responsible
hereunder.
(c) The Investment Manager has acknowledged in writing to the
Investment Committee, the Administrator and the Trustee that he or it
is a fiduciary with respect to the Plans within the meaning of Section
3(21)(A) of ERISA.
The Investment Committee shall furnish the Trustee with written notice
of the appointment of each Investment Manager hereunder, and of the termination
of any such appointment. Such notice shall specify the assets which shall
constitute the Investment Account. The Trustee shall be fully protected in
relying upon the effectiveness of such appointment and the Investment Manager's
continuing satisfaction of the requirements set forth above until it receives
written notice from the Investment Committee to the contrary.
The Trustee shall conclusively presume that each Investment Manager,
under its investment management agreement, is entitled to act, in directing the
investment and reinvestment of the Investment Account for which it is
responsible, in its sole and independent discretion and without limitation,
except for any limitations which from time to time the Investment Committee and
the Trustee agree (in writing) shall modify the scope of such authority.
The Trustee shall have no liability (i) for the acts or omissions of any
Investment Manager; (ii) for following directions, including investment
directions of an Investment Manager, an Administrator or the Investment
Committee, which are given in accordance with this Trust Agreement; or (iii) for
any loss of any kind which may result by reason of the manner of division of the
Trust Fund or Investment Fund into Investment Accounts.
An Investment Manager shall certify, at the request of the Trustee, the
value of any securities or other property held in any Investment Account managed
by such Investment Manager, and such certification shall be regarded as a
direction with regard to such valuation. The Trustee shall be entitled to
conclusively rely upon such valuation for all purposes under this Trust
Agreement.
Section 2.6. Subject to the foregoing provisions of this Article the
Trustee shall have the authority, in addition to any authority given by law, to
exercise the following powers in the administration of the Trust:
(a) to invest and reinvest all or a part of the Fund in
accordance with Participants' investment directions in any available
Investment Fund selected by the Investment Committee without
restriction to investments authorized for fiduciaries, including,
without limitation on the amount that may be invested therein, any
common, collective or commingled trust fund maintained by the
Trustee. Any investment in, and any terms and conditions of, any
common, collective or commingled trust fund available only to
employee trusts which meets the requirements of the Internal Revenue
Code of 1986, as amended (the "Code"), or corresponding provisions of
subsequent income tax laws of the United States, shall constitute an
integral part of this Agreement and each of the Plans, and is hereby
incorporated by reference. The commingling of the assets of this Fund
with the assets of all other qualified participating trusts in such
common collective of commingled trust funds is specifically
authorized.
(b) to dispose of all or any part of the investments,
securities, or other property which may from time to time or at any
time constitute the Fund in accordance with the investment directions
by the Investment Committee or Participants furnished to it pursuant
to Sections 2.1 and 2.2 respectively or the written directions by the
Plan Administrator furnished to it pursuant to Section 1.3, and to
make, execute and deliver to the purchasers thereof good and
sufficient deeds of conveyance therefor, and all assignments,
transfers and other legal instruments, either necessary or convenient
for passing the title and ownership thereto, free and discharged of
all trusts and without liability on the part of such purchasers to
see to the application of the purchase money;
(c) to hold cash uninvested to the extent necessary to pay
benefits or expenses of the Plans;
(d) to cause any investment of the Fund to be registered in
the name of the Trustee or the name of its nominee or nominees or to
retain such investment unregistered or in a form permitting transfer
by delivery; provided that the books and records of the Trustee shall
at all times show that all such investments are part of the Fund;
(e) to vote in person or by proxy with respect to all shares
of the mutual funds offered by The Vanguard Group, Inc. (the
"Vanguard Funds") which are held by the Plan solely in accordance
with directions furnished to it by the Investment Committee, and to
vote in person or by proxy with respect to all other securities
credited to a Participant's separate accounts under the Plan solely
in accordance with directions furnished to it by the Participant in
accordance with the terms of the Plans;
(f) upon the written direction of the Plan Administrator, to
apply for, purchase, hold or transfer any life insurance, retirement
income, endowment or annuity contract;
(g) to consult and employ any suitable agent to act on behalf
of the Trustee and to contract for legal, accounting, clerical and
other services deemed necessary by the Trustee to manage and
administer the Fund according to the terms of the Plans and this
Agreement;
(h) upon the written direction of the Plan Administrator, to
make loans from the Fund to Participants in amounts and on terms
approved by the Plan Administrator in accordance with the provisions
of the Plans; provided that the Plan Administrator shall have the
responsibility for collecting all loan repayments required to be made
under the Plans and for furnishing the Trustee with copies of all
promissory notes evidencing such loans; and
(i) to pay from the Fund all taxes imposed or levied with
respect to the Fund or any part thereof under existing or future
laws, and to contest the validity or amount of any tax, assessment,
claim or demand respecting the Fund or any part thereof.
Section 2.7. Except as may be authorized by regulations promulgated by
the Secretary of Labor, the Trustee shall not maintain the indicia of ownership
in any assets of the Fund outside of the jurisdiction of the district courts of
the United States.
ARTICLE III
DUTIES AND RESPONSIBILITIES
Section 3.1. The Trustee, the Employers, the Investment Committee and
the Plan Administrator shall each discharge their assigned duties and
responsibilities under this Agreement and the Plan solely in the interest of
Participants and their Beneficiaries in the following manner:
(a) for the exclusive purpose of providing benefits to
Participants and their Beneficiaries and defraying reasonable
expenses of administering the Plans;
(b) with the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent person acting in a like
capacity and familiar with such matters would use in the conduct of
an enterprise of a like character and with like aims;
(c) by diversifying the available investments under the Plans
so as to minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so; and
(d) in accordance with the provisions of the Plans and this
Trust Agreement insofar as they are consistent with the provisions of
the Employee Retirement Income Security Act of 1974, as amended
("ERISA").
Section 3.2. The Trustee shall keep full and accurate accounts of all
receipts, investments, disbursements and other transactions hereunder, including
such specific records as may be agreed upon in writing between the Plan
Administrators and the Trustee. All such accounts, books and records shall be
open to inspection and audit at all reasonable times by any authorized
representative of an Employer, or the Plan Administrator, or the Investment
Committee. A Participant may examine only those individual account records
pertaining directly to him.
Section 3.3. Within 120 days after the end of each Plan Year or within
120 days after its removal or resignation, the Trustee shall file with the
Company and each Plan Administrator a written account of the administration of
the Fund showing all transactions effected by the Trustee subsequent to the
period covered by the last preceding account to the end of such Plan Year or
date of removal or resignation and all property held at its fair market value at
the end of the accounting period. Upon approval of such accounting by the
Company and each Plan Administrator, neither the Employers nor the Plan
Administrators shall be entitled to any further accounting by the Trustee. The
Company and each Plan Administrator may approve such accounting by written
notice of approval delivered to the Trustee or by failure to express objection
to such accounting in writing delivered to the Trustee within 90 days from the
date on which the accounting is delivered to the Company and each Plan
Administrator.
Section 3.4. In accordance with the terms of the Plans, the Trustee
shall open and maintain separate accounts in the name of each Participant in
order to record all contributions by or on behalf of the Participant under each
Plan and any earnings, losses and expenses attributable thereto. The Plan
Administrator shall furnish the Trustee with written instructions enabling the
Trustee to allocate properly all contributions and other amounts under each Plan
to the separate accounts of Participants. In making such allocation, the Trustee
shall be fully entitled to rely on the instructions furnished by the Plan
Administrators and shall be under no duty to make any inquiry or investigation
with respect thereto.
Section 3.5. The Trustee shall furnish each Participant with statements
at least annually, or more frequently as may be agreed upon with the Plan
Administrators, reflecting the current fair market value of the Participant's
separate accounts under each Plan.
Section 3.6. The Employers, the Plan Administrators and the Trustee
shall furnish to the other(s) any documents, reports, returns, statements, or
other information that the other(s) reasonably deem necessary to perform their
duties imposed under the Plans or this Agreement or otherwise imposed by law.
Section 3.7. The Trustee shall withhold any tax which by any present or
future law is required to be withheld from any payment under the Plans, provided
that the Plan Administrator provides the information reasonable requested by the
Trustee to enable the Trustee to so withhold.
Section 3.8. The Trustee shall not be required to determine the facts
concerning the eligibility of any Participant to participate in a Plan, the
amount of benefits payable to any Participant or Beneficiary under a Plan, or
the date or method of payment or disbursement. The Trustee shall be fully
entitled to rely solely upon the written advice and directions of the Plan
Administrator as to any such question of fact.
Section 3.9. Unless resulting from the Trustee's negligence, willful
misconduct, lack of good faith, or breach of its fiduciary duties under this
Agreement or ERISA, the Employers shall indemnify and save harmless the Trustee
from, against, for and in respect of any and all damages, losses, obligations,
liabilities, liens, deficiencies, costs and expenses, including without
limitation, reasonable attorney's fees incident to any suit, action,
investigation, claim or proceedings suffered, sustained, incurred or required to
be paid by the Trustee in connection with the Plan or this Agreement.
ARTICLE IV
PROHIBITION OF DIVERSION
Section 4.1. Except as provided in Sections 2.6(i), 4.2 and 6.1, at no
time prior to the satisfaction of all liabilities with respect to Participants
and their Beneficiaries under the Plans shall any part of the corpus or income
of the Fund be used for, or diverted to, purposes other than for the exclusive
benefit of Participants or their Beneficiaries, or for defraying reasonable
expenses of administering the Plans.
Section 4.2. The provisions of Section 4.1 notwithstanding,
contributions made by the Employers under the Plans may be returned to an
Employer under the following conditions:
(a) If a contribution is made by mistake of fact, such contribution
shall be returned to the affected Employer, upon written request of
such Employer, within one year after the date of the payment of such
contribution;
(b) Contributions to the Plan are specifically conditioned upon their
deductibility under the Code. To the extent a deduction is disallowed
for any such contribution, it may be returned to the affected
Employer, upon written request of such Employer, within one year
after the disallowance of the deduction. Contributions which are not
deductible in the taxable year in which made but are deductible in
subsequent taxable years shall not be considered to be disallowed for
purposes of this subsection; and
(c) If a contribution is conditioned upon the qualification of the
Plans and Trust under Section 401 and 501 of the Code, the
contributions of the affected Employers to the Trust for all Plan
Years, with the gains and losses thereon, shall be returned by the
Trustee to the affected Employer, within one year in the event that
the Commissioner of the Internal Revenue fails to rule that the Plans
and Trust were as of such date qualified and tax-exempt (within the
meaning of Sections 401 and 501 of the Code); and
(d) In the event that a Plan whose assets are held in the Fund is
terminated, assets of such Pan may be returned to the affected
Employer if all liabilities to participants and beneficiaries of such
Plan have been satisfied.
ARTICLE V
COMMUNICATION WITH PLAN ADMINISTRATOR, INVESTMENT COMMITTEE
AND EMPLOYERS
Section 5.1. Whenever the Trustee is permitted or required to act upon
the directions or instructions of the Investment Committee, or a Plan
Administrator, the Trustee shall be entitled to act upon any written
communication signed by any person or agent designated to act as or on behalf of
the Investment Committee or Plan Administrator, as applicable. Such person or
agent shall be so designated either under the provisions of the Plans or in
writing by the Company and their authority shall continue until revoked in
writing. The Trustee shall incur no liability for failure to act on such
person's or agent's instructions or orders without written communication, and
the Trustee shall be fully protected in all actions taken in good faith in
reliance upon any instructions, directions, certifications and communications
believed to be genuine and to have been signed or communicated by the proper
person.
Section 5.2. The Company shall notify the Trustee in writing as to the
appointment, removal or resignation of any person designated to act as or on
behalf of the Investment Committee or Plan Administrator. After such
notification, the Trustee shall be fully protected in acting upon the directions
of, or dealing with, any person designated to act as or on behalf of the
Investment Committee or Plan Administrator until it receives notice to the
contrary. The Trustee shall have no duty to inquire into the qualifications of
any person designated to act as or on behalf of the Investment Committee or Plan
Administrator.
ARTICLE VI
TRUSTEE'S COMPENSATION
Section 6.1. The Trustee shall be entitled to reasonable compensation
for its services as agreed upon with the Company. If approved by the applicable
Plan Administrator, the Trustee shall also be entitled to reimbursement for all
direct expenses properly and actually incurred on behalf of a Plan. Such
compensation or reimbursement shall be paid to the Trustee out of the Fund;
provided, however, that the Company, in its absolute discretion, may elect at
any time to pay part or all thereof directly (or to direct the Employers to pay
part or all thereof directly), but any such election shall not bind the Company
as to its right to elect with respect to the same or other expenses at any other
time to have such expenses reimbursed or paid from the Fund. In the event the
Employers pay part or all of such compensation and/or expenses directly, the
Employers may direct the Trustee in writing to reimburse the Employers for such
expenses out of the Fund.
ARTICLE VII
RESIGNATION AND REMOVAL OF TRUSTEE
Section 7.1. The Trustee may resign at any time by written notice to the
Company which shall be effective 30 days after delivery unless prior thereto a
successor Trustee shall have been appointed.
Section 7.2. The Trustee may be removed by the Investment Committee at
any time upon 30 days written notice to the Trustee; such notice, however, may
be waived by the Trustee.
Section 7.3. The appointment of a successor Trustee hereunder shall be
accomplished by and shall take effect upon the delivery to the resigning or
removed Trustee, as the case may be, of written notice of the Investment
Committee appointing such successor Trustee, and an acceptance in writing of the
office of successor Trustee hereunder executed by the successor so appointed.
Any successor Trustee may be either a corporation authorized and empowered to
exercise trust powers or one or more individuals. All of the provisions set
forth herein with respect to the Trustee shall relate to each successor Trustee
so appointed with the same force and effect as if such successor Trustee had
been originally named herein as the Trustee hereunder. If within 30 days after
notice of resignation shall have been given under the provisions of this Article
a successor Trustee shall not have been appointed, the resigning Trustee or the
Company may apply to any court of competent jurisdiction for the appointment of
a successor Trustee.
Section 7.4. Upon the appointment of a successor Trustee, the resigning
or removed Trustee shall transfer and deliver the Fund to such successor
Trustee, and after the final account of the resigning or removed Trustee has
been approved or settled, any Trustee so resigning or removed shall make no
surrender charge with respect to the Fund.
ARTICLE VIII
INSURANCE COMPANIES
Section 8.1. If any contract issued by an insurance company shall form a
part of the Fund assets, the insurance company shall not be deemed a party to
this Agreement. A certification in writing by the Trustee as to the occurrence
of any event contemplated by this Agreement or the Plans shall be conclusive
evidence thereof and the insurance company shall be protected in relying upon
such certification and shall incur no liability for so doing. With respect to
any action under any such contract, the insurance company may deal with the
Trustee as the sole owner thereof and need not see that any action of the
Trustee is authorized by this Agreement or the Plans. Any change made or action
taken by an insurance company upon the direction of the Trustee shall fully
discharge the insurance company from all liability with respect thereto, and it
need not see to the distribution or further application of any moneys paid by it
to the Trustee or paid in accordance with the direction of the Trustee.
ARTICLE IX
AMENDMENT AND TERMINATION OF THE TRUST
Section 9.1. The Company may, by delivery to the Trustee of an
instrument in writing, amend, terminate or partially terminate this Agreement at
any time; provided, however, that no amendment shall increase the duties or
liabilities of the Trustee without the Trustee's consent; and, provided further,
that no amendment shall divert any part of the Fund to any purpose other than
providing benefits to Participants and their Beneficiaries or defraying
reasonable expenses of administering the Plans. In the event of a termination or
partial termination of the Agreement, the Fund (or applicable portion thereof)
shall be paid out by the Trustee after settlement of its final account in
accordance with applicable law pursuant to instructions given by the Company.
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.1. Unless the context of this Agreement clearly indicates
otherwise, the terms defined in the Plans shall, when used herein, have the same
meaning as in the Plans.
Section 10.2. Except as otherwise required in the case of any qualified
domestic relations order within the meaning of Section 414(p) of the Code, the
benefits or proceeds of any allocated or unallocated portion of the assets of
the Fund and any interest of any Participant or Beneficiary arising out of or
created by a Plan either before or after the Participant's retirement shall not
be subject to execution, attachment, garnishment or other legal or judicial
process whatsoever by any person, whether creditor or otherwise, claiming
against such Participant or Beneficiary. No Participant or Beneficiary shall
have the right to alienate, encumber or assign any of the payments or proceeds
or any other interest arising out of or created by the Plan and any action
purporting to do so shall be void. The provisions of this Section shall apply to
all Participants and Beneficiaries, regardless of their citizenship or place of
residence.
Section 10.3. Nothing contained in this Agreement or in the Plans shall
require the Employers to retain any Employee in its service.
Section 10.4. Any person dealing with the Trustee may rely upon a copy
of this Agreement and any amendments thereto certified to be true and correct by
the Trustee.
Section 10.5. The Trustee hereby acknowledges receipt of a copy of each
of the Plans. The Plan Administrator will cause a copy of any amendment to a
Plan to be delivered to the Trustee.
Section 10.6. If any provision of this Agreement shall be held by a
court of competent jurisdiction to be invalid or unenforceable, the remaining
provisions of this Agreement shall continue to be fully effective.
Section 10.7. The construction, validity and administration of this
Agreement and the Plans shall be governed by the laws of the Commonwealth of
Pennsylvania, except to the extent that such laws have been specifically
superseded by ERISA.
ARTICLE XI
PARTICIPATION BY OTHER EMPLOYERS
Section 11.1. Adoption by Other Employers; Withdrawals. The Fund is
established by the Company for use as the funding vehicle for the Plans which it
maintains for various groups of employees and for use as the funding vehicle for
the Plans of any Employer.
(a) Any Employer which has been certified to the Trustee by
the company as being authorized and as having adopted this Trust with
the consent of the Company as a funding vehicle for its own Plans may,
at any time thereafter, become a party to this Trust Agreement. Such
Employer must file with the Trustee a certified copy of a resolution of
its Board of Directors (or its delegate) evidencing its election so to
do; and
(b) Any Employer which is a party to this Trust Agreement and
which has been certified to the Trustee by the Company as having adopted
one or more other Plans and as being authorized to adopt this Trust as
the funding medium for such other Plan or Plans may, at any time
thereafter, adopt this Trust for the purposes of such other Plan or
Plans by filing with the Trustee a certified copy of a resolution of its
Board of Directors (or its delegate) evidencing its election so to do.
Thereafter, the Trustee shall receive and hold as a part of the Trust
Fund, subject to the provisions of this Trust Agreement, any deposits made to it
under such Plans by or at the direction of such Employer. Should this paragraph
become operative:
(i) In the event of the withdrawal of a Plan from the trust
or in the event of the Company's or an Employer's election to terminate
or to fund separately the benefits provided under any of its Plans, the
Company shall require the Trustee to value the share of the Fund which
is held for the benefit or persons having an interest therein under such
Plans. The Trustee shall there upon segregate and dispose of such share
in accordance with the written direction of the Company accompanied by
its certification to the Trustee that such segregation and disposition
is in accordance with the terms of the Plans and the requirements of the
law.
(ii) If the company or any Employer receives notice that one
or more of the Plans is no longer qualified under the provisions of
Section 401 of the Code or the corresponding provisions of any future
Federal revenue act, the Company shall immediately require the Trustee
to value the share of the Fund which is held for the benefit of such
persons having an interest under such disqualified Plan or Plans. The
Trustee shall thereupon segregate, withdraw from the Trust Fund, and
dispose of such share as directed by the Company.
(iii) In the event that any group of employees covered by a
Plan is withdrawn from such Plan, the Company shall, if required by the
terms of such Plan, require the Trustee to value the share of the Fund
which is held for the benefit of such group of employees. The Trustee
shall thereupon segregate and dispose of such share in accordance with
the direction of the Company accompanied by its certification to the
Trustee that such segregation and disposition is in accordance with the
terms of such Plan and the requirements of the law.
The Trustee shall have no duty to see that the valuation of any share in
accordance with the provisions of this Section 11.1 is caused to be made by the
Company, nor to segregate and dispose of any such share in the absence of the
written direction of the Company to do so.
Section 11.2. Powers and Authorities of Other Employers to be Exercised
Excessively by Company. Each Employer, other than the Company, which is or shall
become a party to this Trust Agreement, hereby irrevocably gives and grants to
the Company full and exclusive power and authority to exercise all of the powers
conferred upon it by the terms of this Trust Agreement and to take or refrain
from taking any and all action which such Employer might otherwise take or
refrain from taking with respect to this Trust Agreement, including the sole and
exclusive power to exercise, enforce or waive any rights whatsoever which such
Employer might otherwise have with respect to the Trust Fund, and each such
Employer, by becoming a party to this Trust Agreement, irrevocably appoints the
Company its agent for such purposes. The Trustee shall have no obligation to
account to any such Employer or to follow the instructions of or otherwise deal
with any such Employer, the intention being that the Trustee shall deal solely
with the Company as if the Trustee and the Company were the only parties in this
Trust Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
Attest: NACCO INDUSTRIES, INC.
Charles A. Bittenbender By Steven M. Billick
Attest: VANGUARD FIDUCIARY TRUST COMPANY
Nancy D. Higgs By R. Gregory Barton
Vice President
<PAGE>
EXHIBIT A
1. The North American Coal Corporation Retirement Savings Plan
2. The NACCO Materials Handling Group, Inc. Profit Sharing Plan
3. The Hamilton Beach/Proctor-Silex, Inc. Employees' Retirement Savings
(401(k)) Plan
4. The Kitchen Collection, Inc. Retirement Income Plan
Exhibit 10(clxxvi)
AMENDMENT NO. 1
TO THE
HAMILTON BEACH/PROCTOR-SILEX, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN (401(k))
(As Amended and Restated Effective January 1, 1994)
Hamilton Beach/Proctor-Silex, Inc. hereby adopts this Amendment No. 1 to
the Hamilton Beach/Proctor-Silex, Inc. Employees' Retirement Savings Plan
(401(k)) (the "Plan"). Except as otherwise provided herein, the provisions of
this Amendment shall be effective July 1, 1995. Words and phrases used herein
with initial capital letters which are defined in the Plan are used herein as so
defined.
Section 1
A new Section 1.1(12A) is hereby added to the Plan, to read as follows:
"(12A) Disability: The termination of an Employee's employment
with the Controlled Group under circumstances which make him
eligible for benefits under the long-term disability program
sponsored by his Employer or the federal Social Security Act.
An Employee who terminates his employment due to a Disability
shall be referred to as being "Disabled" for as long as such
Disability continues."
Section 2
Section 1.1(16) of the Plan is hereby amended by adding the words ",
Post-1994 Matching Employer Contributions provided for in Section 3.5A," after
the words "prior to January 1, 1992".
Section 3
Section 1.1(17) of the Plan is hereby amended in its entirety to read as
follows:
"(17) Entry Date: Each January 1, April 1, July 1 and October
1. In addition, there shall be a one-time special Entry Date
effective and occurring on July 1, 1995."
Section 4
Effective as of January 1, 1995, Section 1.1(20)(c) of the Plan is hereby
amended by adding the phrase "and room and board expenses" after the phrase
"related educational fees" therein.
Section 5
A new Section 1.1(25A) is hereby added to the Plan, to read as follows:
"(25A) Matching Employer Contributions: Mandatory Matching
Employer Contributions and Additional Matching Employer
Contributions made to the Plan prior to January 1, 1992
(together, "Pre-1992 Matching Employer Contributions") and
Post-1994 Matching Employer Contributions made by an Employer
pursuant to Section 3.5A."
Section 6
Section 1.1(40) of the Plan is hereby amended in its entirety to read as
follows:
"(40) Vested Interest: A Participant shall have a 100% Vested
Interest in the portion of his Account which is derived from
Participant Contributions, Qualified Nonelective
Contributions, Rollover Contributions, Profit Sharing
Contributions and Pre-1992 Matching Employer Contributions. A
Participant shall have a 100% Vested Interest in the portion
of his Account derived from Post-1994 Matching Employer
Contributions upon completion of five (5) Years of Vesting
Service.
Notwithstanding the foregoing, a Participant shall have a 100%
Vested Interest in his entire Account when he attains his
Normal Retirement Date or becomes Disabled or dies while
employed by a Controlled Group Member. A Participant's Vested
Interest shall be nonforfeitable at all times."
<PAGE>
Section 7
A new Section 1.1(41) is hereby added to the Plan, to read as follows:
"(41) Year of Vesting Service: Each Employee shall be credited
with one Year of Vesting Service for each year of employment
by the Controlled Group. For this purpose, periods of absence
from work of less than 12 months shall be included in
determining years of employment. Service of 6 months, or
greater, in any employment year as measured from the date of
hire (original or aggregated) shall be rounded to credit for
one Year of Vesting Service. In no event, however, shall an
Employee be credited with greater than one Year of Vesting
Service for any employment year."
Section 8
Section 2.1 of the Plan is hereby amended by deleting the phrase "age
20-1/2" and by replacing it with the phrase "age 21."
Section 9
Section 2.3 of the Plan is hereby amended by adding the words "and
Post-1994 Matching Employer Contributions" after the words "with respect to
Participant Contributions" in the second and third lines thereof.
Section 10
New Sections 3.5A and 3.5B are hereby added to the Plan, immediately
following section 3.5, to read as follows:
"3.5A Amount of Post-1994 Matching Employer Contributions.
Each Employer shall contribute to the Trust Fund Post-1994
Matching Employer Contributions in an amount equal to 50% of
the first 2% of Before-Tax Contributions made for each
Participant who is an Employee of such Employer up to a total
Post-1994 Matching Employer Contribution of 1% of each such
Participant's Compensation. The Employer shall transmit its
Post-1994 Matching Employer Contributions on account of a
payroll period to the Trustee at the same time that it
transmits the Before-Tax Contributions to which such Post-1994
Matching Employer Contributions relate.
3.5B Allocation of Post-1994 Matching Employer Contributions.
Each Employer's Post-1994 Matching Employer Contributions made
for a payroll period shall be allocated and credited to the
Account of each Participant for whom Before-Tax Contributions
were made during such payroll period, with each such
Participant being credited with a portion of the Employer's
Post-1994 Matching Employer Contribution equal to 50% of the
first 2% of his Before-Tax Contributions for such payroll
period up to a total Post-1994 Matching Employer Contribution
of 1% of his Compensation for such payroll period."
Section 11
The first sentence of Section 3.6 of the Plan is hereby amended by adding
the words ",Section 4.2A, or Section 4.2B" after the words "deem necessary to
cause Section 4.2" therein.
Section 12
A new Section 3.8 is hereby added to the Plan, immediately following
section 3.7, to read as follows:
"3.8 Reduction of Employer Contributions. The amount of
Employer Contributions determined to be payable to the Trust
Fund shall be reduced by amounts which have been forfeited or
held in a suspense account in accordance with the terms of the
Plan."
Section 13
Section 4.1 of the Plan is amended by adding a new Subsection (3) thereto,
to read as follows:
(3) In the event that a Participant's Before-Tax
Contributions under this Plan exceed the amount described in
Subsection (1) of this Section, or in the event that a
Participant's Before-Tax Contributions made under this Plan do
not exceed such amount but he allocates a portion of his
excess deferrals to his Before-Tax Contributions made to this
Plan, Post-1994 Matching Employer Contributions, if any, made
with respect to such Before-Tax Contributions (and any income
allocable thereto) shall be forfeited and applied to reduce
subsequent Post-1994 Matching Employer Contributions required
under the Plan."
Section 14
Section 4.2 of the Plan is hereby amended by (a) adding the words "and
Section 4.2A" after the words "For purposes of this Section" in the second and
fourth sentences of Subsection (2) thereof, (b) adding the words "and Section
4.2A" after the words "For purposes of this Section" in Subsection (3) thereof,
and (c) adding a new Subsection (5) thereto, to read as follows:
"(5) Post-1994 Matching Employer Contributions made with
respect to a Participant's excess contributions (and any
income allocable thereto) shall be forfeited and applied to
reduce subsequent Post-1994 Matching Employer Contributions
required under the Plan as well as administrative expenses of
the Plan.".
Section 15
New Sections 4.2A and 4.2B are hereby added to the Plan, immediately
following Section 4.2, to read as follows:
"4.2A ACP Test.
(1) Notwithstanding any provision of the Plan to the
contrary, for any Plan Year the contribution percentage (as
defined in Subsection (2) of this Section) for the group of
Highly Compensated Eligible Employees (as defined in Section
4.2(3)) for such Plan Year shall not exceed the greater of 125
percent of the contribution percentage for all other Eligible
Employees or the lesser of 200 percent of the contribution
percentage for all other Eligible Employees, or the
contribution percentage for all other Eligible Employees plus
2 percentage points. If two or more plans of the Controlled
Group to which matching contributions, employee after-tax
contributions or before-tax contributions (as defined in
Section 4.1(1)) are made are treated as one plan for purposes
of Code Section 410(b), such plans shall be treated as one
plan for purposes of this Subsection; and if a Highly
Compensated Eligible Employee participates in two or more
plans of the Controlled Group to which such contributions are
made, all such contributions shall be aggregated for purposes
of this Subsection.
(2) For the purposes of this Section, the contribution
percentage for a specified group of Eligible Employees for a
Plan Year shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of the
sum of the Post-1994 Matching Employer Contributions and, at
the election of an Employer, any Before-Tax Contributions or
Qualified Nonelective Contributions paid under the Plan by or
on behalf of each such Eligible Employee for such Plan Year
and not taken into account for such Plan Year under Section
4.2(2) to the Eligible Employee's compensation (as defined in
Section 4.2(2)) for such Plan Year. In the case of a Highly
Compensated Eligible Employee who is either a 5-percent owner
(as defined in Code Section 416(i)(1)) or one of the ten most
Highly Compensated Employees, the combined contribution ratio
for the family group (as such term is defined in Section
4.2(2)), which shall be treated as one Highly Compensated
Employee, shall be determined by combining the Post-1994
Matching Employer Contributions (and, at the election of an
Employer, Before-Tax Contributions or Qualified Nonelective
Contributions) and compensation of all members of the family
group who are Eligible Employees. For the purposes of
determining "the contribution percentage for all other
Eligible Employees" as referred to in Subsection (1) of this
Section, the contributions described in the preceding
paragraph for and the compensation of all members of the
family group shall be disregarded.
(3) In the event that excess aggregate contributions (as
such term is hereinafter defined) are made to the Trust for
any Plan Year, then, prior to March 15 of the following Plan
Year, such excess contributions (and any income allocable
thereto) shall be forfeited (if forfeitable) and applied as
provided in Section 3.8 or (if not forfeitable) shall be
distributed to the Highly Compensated Eligible Employees on
the basis of the respective portions of the excess
contributions attributable to each such Eligible Employee. For
the purposes of this Subsection, the term "excess aggregate
contributions" shall mean, for any Plan Year, the excess of
(a) the aggregate amount of the Post-1994 Matching Employer
Contributions actually paid to the Trust Fund by or on behalf
of Highly Compensated Eligible Employees for such Plan Year
over (b) the maximum amount of such Post-1994 Matching
Employer Contributions permitted for such Plan Year under
Subsection (1) of this Section, determined by reducing
Post-1994 Matching Employer Contributions made by or on behalf
of Highly Compensated Eligible Employees in order of their
contribution percentages (as defined in Subsection (2) of this
Section) beginning with the highest of such percentages.
Notwithstanding the foregoing provisions of this Subsection,
in the case of a Highly Compensated Eligible Employee whose
contribution percentage is determined under the family
aggregation rules set forth in Subsection (2) of this Section,
the determination and correction of the amount of excess
aggregate contributions shall be made by reducing the
contribution ratio in accordance with the "leveling" method
described in Treasury Regulation Section 1.401(k)-1(f)(2) and
allocating the excess aggregate contributions for the family
group among its members in proportion to the Post-1994
Matching Employer Contributions of each member of the family
group that is combined to determine the contribution ratio.
4.2B Multiple Use of the Alternative Limitation.
(1) Notwithstanding the provisions of Article III or the
foregoing provisions of this Article IV, if, after the
application of Sections 4.1, 4.2 and 4.2A, the sum of the
actual deferral percentage and the contribution percentage for
the group of Highly Compensated Eligible Employees (as defined
in Section 4.2(3)) exceeds the aggregate limit (as defined in
Subsection (2) of this Section), then the contributions made
for such Plan Year for Highly Compensated Eligible Employees
will be reduced so that the aggregate limit is not exceeded.
Such reductions shall be made first in Before-Tax
Contributions (but only to the extent that they are not
matched by Post-1994 Matching Employer Contributions) and then
in Post-1994 Matching Employer Contributions. Reductions in
contributions shall be made in the manner provided in Section
4.2 or 4.2A, as applicable. The amount by which each such
Highly Compensated Eligible Employee's contribution percentage
amount is reduced shall be treated as an excess contribution
or an excess aggregate contribution under Section 4.2 or 4.2A,
as applicable. For the purposes of this Section, the actual
deferral percentage and contribution percentage of the Highly
Compensated Eligible Employees are determined after any
reductions required to meet those tests under Sections 4.2 and
4.2A. Notwithstanding the foregoing provisions of this
Section, no reduction shall be required by this Subsection if
either (a) the actual deferral percentage of the Highly
Compensated Eligible Employees does not exceed 1.25 multiplied
by the actual deferral percentage of the non-Highly
Compensated Eligible Employees, or (b) the contribution
percentage of the Highly Compensated Eligible Employees does
not exceed 1.25 multiplied by the contribution percentage of
the non-Highly Compensated Eligible Employees.
(2) For purposes of this Section, the term "aggregate
limit" shall mean the greater of the limit produced by (a) or
(b) below:
(a) the sum of (i) 125 percent of the greater of the
actual deferral percentage of the non-Highly Compensated
Eligible Employees or the average contribution percentage of
the non-Highly Compensated Eligible Employees subject to
Section 401(m) of the Code for the Plan Year, and (ii) two (2)
plus the lesser of such actual deferral percentage or actual
contribution percentage (however, this amount shall not exceed
200 percent of the lesser of such actual deferral percentage
or actual contribution percentage);
(b) the sum of (i) 125 percent of the lesser of the
actual deferral percentage of the non-Highly Compensated
Eligible Employees for the Plan Year or the actual
contribution percentage of the non-Highly Compensated Eligible
Employees subject to Section 401(m) of the Code for the Plan
Year, and (ii) two (2) plus the greater of such actual
deferral percentage or actual contribution percentage
(however, this amount shall not exceed 200 percent of the
greater of such actual deferral percentage or actual
contribution percentage)."
Section 16
Section 4.3(1) of the Plan is hereby amended in its entirety to read as
follows:
"(1) In order to ensure that at least one of the actual
deferral percentages specified in Section 4.2(1) and at least
one of the contribution percentages specified in Section
4.2A(1) and the aggregate limit specified in Section 4.2B are
satisfied for each Plan Year, the Company shall monitor (or
cause to be monitored) the amount of Before-Tax Contributions
and Post-1994 Matching Employer Contributions being made to
the Plan by or for each Eligible Employee during each Plan
Year. In the event that the Company determines that neither of
such actual deferral percentages, neither of such contribution
percentages or such aggregate limit will be satisfied for a
Plan Year, and if the Committee in its sole discretion
determines that it is necessary or desirable, the Before-Tax
Contributions and/or Post-1994 Matching Employer Contributions
made thereafter by or for each Highly Compensated Eligible
Employee (as defined in Section 4.2(3)) may be reduced
(pursuant to non-discriminatory rules adopted by the Company)
to the extent necessary to decrease the actual deferral
percentage and/or the contribution percentage for Highly
Compensated Eligible Employees for such Plan Year to a level
which satisfies either of the actual deferral percentages,
either of the contribution percentages and/or the aggregate
limit."
Section 17
Section 4.3(3) of the Plan is hereby amended by adding the words ", 4.2A,
and 4.2B" after the words "described in Sections 4.1 and 4.2" therein.
Section 18
Section 4.4 of the Plan is hereby amended by adding the words "4.2A or
4.2B" after the words "set forth in Section 4.2" each time those words appear
therein.
Section 19
Effective January 1, 1995, Section 4.5(1) of the Plan is hereby amended by
deleting the parenthetical phrase in clause (a) thereof and replacing it with
the following parenthetical phrase: "(as adjusted pursuant to Code Section
415(d))."
Section 20
Section 4.5(4) of the Plan is hereby amended in its entirety to read as
follows:
"(4) If a Participant's annual additions would exceed the limitations of
Subsection (1) of this Section for a Plan Year as a result of the allocation of
forfeitures, a reasonable error in estimating the Participant's compensation, or
a reasonable error in determining the amount of Before-Tax Contributions that
may be made with respect to the Participant under the limitations of this
Section (or other facts and circumstances which the Commissioner of Internal
Revenue finds justify application of the following rules of this Subsection),
Before-Tax Contributions (which are not subject to Post-1994 Matching Employer
Contributions) made by the Participant for such Plan Year (together with any
gains attributable thereto) shall be returned to him to the extent necessary. If
the return of all such non-matched Before-Tax Contributions is not sufficient to
cause the limitations of Subsection (1) of this Section not to be exceeded for
such Plan Year, Before-Tax Contributions which are subject to Post-1994 Matching
Employer Contributions made by the Participant for such Plan Year (together with
any gains attributable thereto) shall be returned to him to the extent necessary
and the corresponding Post-1994 Matching Employer Contributions shall be
forfeited and applied to reduce future Employer Contributions and administrative
expenses of the Plan. In the event a reduction is necessary to avoid exceeding
the limitations set forth in this section, and the individual is a participant
in two defined contribution plans maintained by the Controlled Group, the
affected individual's benefits under this Plan shall be reduced first to the
extent necessary to avoid exceeding such limitations." Section 21
Section 5.2 of the Plan is hereby amended by deleting the parenthetical
phrase "(as further divided into Matching Contributions and Profit Sharing
Contributions)" and by substituting therefor the parenthetical phrase "(as
further divided into Pre-1992 Matching Employer Contributions, Profit Sharing
Contributions and Post-1994 Matching Employer Contributions)".
Section 22
Section 6.1(1) of the Plan is hereby amended by deleting the term "Vested
Interest" and replacing it with the word "interest".
Section 23
Section 6.2(1) of the Plan is hereby amended by deleting the phrase
"pursuant to Section 6.1 shall be" and replacing it with the phrase "pursuant to
Section 6.1 shall be nonforfeitable and it shall be."
Section 24
Section 6.3 of the Plan is hereby amended by adding the words "With Full
Vesting" to the end of the heading of thereof.
Section 25
The first clause of Section 6.3(1) of the Plan is hereby amended in its
entirety to read as follows:
"(1) Subject to the provisions of Section 6.4, if a Participant's
termination of employment with the Controlled Group occurs (other than by reason
of his death) on or after he has reached his Normal Retirement Age, on or after
the date he has been credited with at least five (5) Years of Vesting Service or
by reason of his Disability, his entire Account, valued as of the Valuation Date
specified in Subsection (3) of this Section shall be nonforfeitable and shall be
paid or commence to be paid to him under one of the following methods as the
Participant shall elect:"
Section 26
A new Section 6.3A is hereby added to the Plan, immediately following
Section 6.3, to read as follows:
"6.3A Distribution on Other Termination of Employment.
(1) Subject to the provisions of Section 6.4, if a
Participant's termination of employment with the Controlled
Group occurs under circumstances other than those covered by
Sections 6.2 and 6.3, his entire Vested Interest valued as of
the Valuation Date specified in Section 6.3(3), shall be paid
or commence to be paid to him under one of the methods set
forth in Section 6.3(1) as the Participant shall elect
(limited to the method specified in Section 6.3(1)(a) for
Participants who first became Participants on or after January
1, 1994); and that portion of his Post-1994 Matching Employer
Contributions Sub-Account which is not nonforfeitable under
Section 1.1(40) shall be forfeited on the date the Participant
terminates employment with the Controlled Group.
(2) Notwithstanding the foregoing provisions of this
Article, if the value of the Vested Interest of a Participant
does not exceed $3,500 on the Valuation Date preceding his
termination of employment with the Controlled Group and never
exceeded $3,500 at the time of any previous withdrawal or
distribution, such Vested Interest shall be paid to him in a
lump sum in cash as soon as practicable after such Valuation
Date. If the value of the Participant's Vested Interest on
such Valuation Date is less than 100 percent, the non-vested
portion of the Participant's Account shall be deemed to have
been paid to him in a lump sum as soon as practicable after
such Valuation Date. That portion of the Participant's
Post-1994 Matching Employer Contributions Sub-Account which is
not then nonforfeitable shall be forfeited on the date he
terminates employment with the Controlled Group.
(3) Amounts, if any, forfeited pursuant to the preceding
Subsections of this Section shall be used to reduce subsequent
Employer Contributions, being applied to the extent possible
against the subsequent Employer Contributions of the Employers
of the Participants from whose Accounts such forfeitures
arise. In the event of the termination of the Plan, any
forfeitures not so applied at the time of such termination
shall be returned to the Employers of the Participants from
whose Accounts such forfeitures arose.
(4) If a Participant who terminates employment with the
Controlled Group under the circumstances covered by Subsection
(1) of this Section is rehired as an Employee, an amount equal
to the amount forfeited under the preceding Subsections of
this Section shall be restored to his Account immediately upon
his reemployment as an Employee."
Section 27
Section 6.5 is hereby amended by deleting the word "Account" whenever such
word appears therein and by substituting therefor the words "Vested Interest".
Section 28
Section 6.8(2) of the Plan is hereby amended by adding the words "as well
as his Vested Interest in his Post-1994 Matching Employer Contribution
Sub-Account" after the words "Rollover Contributions Sub-Account" therein.
Section 29
The first sentence of Section 6.11(1) of the Plan is hereby amended by
deleting the phrase "from his Account" and replacing it with the phrase "from
the Vested Interest of his Account."
Section 30
The third sentence of Section 6.11(1) of the Plan is hereby amended by
deleting the words "Matching Contributions Sub-Account" and substituting
therefor the words "Vested Interest in the portion of his Matching Employer
Contributions Sub-Account that is comprised of his Pre-1992 Matching Employer
Contributions Sub-Account and Post-1994 Matching Employer Contributions
Sub-Account".
Section 31
The first sentence of Section 6.11(2) of the Plan is hereby amended in its
entirety to read as follows:
"A Participant may only have two loans outstanding at a time."
Section 32
Section 6.11(4)(d)(iii) of the Plan is hereby amended in its entirety to
read as follows:
"(iii) repayment within a specified period of time (in monthly
increments, with a minimum of 12 months), which shall not
extend beyond five years except that the term of a principal
residence loan may extend to thirty years."
Section 33
The first sentence of Section 13.3 of the Plan is hereby amended by adding
the words "or Post-1994 Matching Employer Contributions" after the words
"greater or lesser Participant Contributions" therein.
Section 34
A new Section 16.5A is hereby added to the Plan, to read as follows:
"16.5 Minimum Vesting Requirement. If the Plan is a Top-Heavy
Plan for any Plan Year, each Employee who has completed at
least three Years of Vesting Service and who has an Hour of
Service after the Plan becomes a Top-Heavy Plan shall have a
nonforfeitable right to 100 percent of his Post-1994 Matching
Employer Contributions Sub-Account. The vesting schedule
described in the immediately preceding sentence shall cease to
be applicable when the Plan ceases to be a Top-Heavy Plan,
provided that an Employee's Post-1994 Matching Employer
Contributions Sub-Account that becomes nonforfeitable pursuant
thereto before the Plan ceases to be a Top-Heavy Plan shall
remain nonforfeitable and the change in the vesting schedule
resulting from the inapplicability of the vesting schedule
described in the immediately preceding sentence shall be
subject to the provisions of Section 12.3."
EXECUTED this 16th day of May, 1995.
HAMILTON BEACH/PROCTOR-SILEX, INC.
By: Ronald C. Eksten
Title: Vice President
Exhibit 11
NACCO Industries, Inc. And Subsidiaries
Form 10-Q
Computation of Earnings per Share
<TABLE>
<CAPTION>
Three Months Six Months
Ended June 30 Ended June 30
1995 1994 1995 1994
(Amounts in thousands except per share data)
Income:
<S> <C> <C> <C> <C>
Income before extraordinary charge .............................. $ 14,732 $ 9,191 $ 27,537 $ 11,961
Extraordinary charge, net-of-tax ................................ -- (3,218) (1,280) (3,218)
-------- -------- -------- -----
Net income ...................................................... $ 14,732 $ 5,973 $ 26,257 $ 8,743
======== ======== ======== =====
Per share amounts reported to stockholders - Note 1:
Income before extraordinary charge .............................. $ 1.64 $ 1.03 $ 3.07 $ 1.34
Extraordinary charge, net-of-tax ................................ -- (.36) (.14) (.36)
-------- -------- -------- -----
Net income ...................................................... $ 1.64 $ .67 $ 2.93 $ .98
======== ======== ======== =====
Primary:
Weighted average shares outstanding ............................. 8,965 8,949 8,961 8,945
Dilutive stock options - Note 2 ................................. 12 11 11 13
-------- -------- -------- -----
Totals .................................................... 8,977 8,960 8,972 8,958
======== ======== ======== =====
Per share amounts
Income before extraordinary charge ........................ $ 1.64 $ 1.03 $ 3.07 $ 1.34
Extraordinary charge, net-of-tax .......................... -- (.36) (.14) (.36)
-------- -------- -------- -----
Net income ................................................ $ 1.64 $ .67 $ 2.93 $ .98
======== ======== ======== =====
Fully diluted - Note 3:
Weighted average shares outstanding ............................. 8,965 8,961
Dilutive stock options - Note 2 ................................. 13 13
-------- --------
Totals .................................................... 8,978 8,974
======== ========
Per share amounts
Income before extraordinary charge ........................ $ 1.64 $ 3.07
Extraordinary charge, net-of-tax .......................... -- (.14)
------- ------
Net income ................................................ $ 1.64 $ 2.93
======== ======
</TABLE>
<PAGE>
EXHIBIT 11 - continued
Note 1 - Per share earnings have been computed and reported to the
stockholders pursuant to APB Opinion No. 15, which provides that "any
reduction of less than 3% in the aggregate need not be considered as dilution
in the computation and presentation of earnings per share data."
Note 2 - Dilutive stock options are calculated based on the treasury stock
method. For primary per share earnings the average market price is used. For
fully diluted per share earnings the period-end market price, if higher than
the average market price, is used.
Note 3 -- Fully diluted per share earnings for the three and six months ended
June 30, 1994 are not disclosed because the quarter-end market price did not
exceed the average market price for the three and six month periods in 1994.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000789933
<NAME> NACCO INDUSTRIES
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 30,359
<SECURITIES> 0
<RECEIVABLES> 236,866
<ALLOWANCES> 0
<INVENTORY> 393,566
<CURRENT-ASSETS> 690,246
<PP&E> 506,865
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,798,037
<CURRENT-LIABILITIES> 468,273
<BONDS> 0
<COMMON> 8,965
0
0
<OTHER-SE> 299,732
<TOTAL-LIABILITY-AND-EQUITY> 1,798,037
<SALES> 1,014,254
<TOTAL-REVENUES> 1,019,970
<CGS> 819,510
<TOTAL-COSTS> 953,556
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</TABLE>
