SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
X Annual Report Pursuant to Section 15 (d) of
- --- the Securities Exchange Act of 1934
For the Fiscal Year Ended October 31, 1996
___ Transition Report Pursuant to Section 15 (d)
of the Securities Exchange Act of 1934
For the transition period from ___ to ___
Commission file number:
Harnischfeger Industries
Employees' Savings Plan 1-9299
A. Full title of the Plan and the address of the
Plan, if different from that of the issuer
named below:
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
B. Name of issuer of the securities held
pursuant to the Plan and the address of its
principal executive office:
Harnischfeger Industries, Inc.
3600 South Lake Drive
St. Francis, Wisconsin 53235-3716
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
---------------------------------
To the Participants and Administrator of
Harnischfeger Industries
Employees' Savings Plan
In our opinion, the accompanying statements of net
assets available for benefits and the related
statements of changes in net assets available for
benefits present fairly, in all material respects,
the net assets available for benefits of the
Harnischfeger Industries Employees' Savings Plan
(the "Plan") at October 31, 1996 and 1995, and the
changes in net assets available for benefits for
the years then ended, in conformity with generally
accepted accounting principles. These financial
statements are the responsibility of the Plan's
management; our responsibility is to express an
opinion on these financial statements based on our
audits. We conducted our audits of these
statements in accordance with generally accepted
auditing standards which require that we plan and
perform the audit to obtain reasonable assurance
about whether the financial statements are free of
material misstatement. An audit includes
examining, on a test basis, evidence supporting
the amounts and disclosures in the financial
statements, assessing the accounting principles
used and significant estimates made by management,
and evaluating the overall financial statement
presentation. We believe that our audits provide
a reasonable basis for the opinion expressed
above.
Our audit was made for the purpose of forming an
opinion on the basic financial statements taken as
a whole. The additional information included in
Schedules I and II is presented for purposes of
additional analysis and is not a required part of
the basic financial statements but is additional
information required by ERISA. Such information
has been subjected to the auditing procedures
applied in the audit of the basic financial
statements and, in our opinion, is fairly stated
in all material respects in relation to the basic
financial statements taken as a whole.
Price Waterhouse LLP
April 23, 1997<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
Fidelity
Fidelity Equity
Magellan Income Fixed Income
Fund Fund Fund
------------ ----------- ------------
<S> <C> <C> <C>
ASSETS: $ $ $
Investments -
Fixed income fund - - 92,577,208
Mutual stock funds 51,848,938 24,554,017 -
Mutual bond fund - - -
Diversification fund - - -
Harnischfeger common
stock fund - - -
Loans to participants - - -
------------ ----------- -----------
Total Investments 51,848,938 24,554,017 92,577,208
------------ ----------- -----------
RECEIVABLES:
Receivables -
Employee contributions 233,049 94,474 257,353
------------ ----------- -----------
Total Assets 52,081,987 24,648,491 92,834,561
LIABILITIES:
Payables -
Accrued expenses - - 109,603
------------ ----------- -----------
Total Liabilities - - 109,603
------------ ----------- -----------
NET ASSETS AVAILABLE
FOR BENEFITS 52,081,987 24,648,491 92,724,958
============ =========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
Fidelity Fidelity Fidelity
Intermediate Overseas U.S. Equity
Bond Fund Fund Index Fund
------------ ----------- ------------
<S> <C> <C> <C>
ASSETS: $ $ $
Investments -
Fixed income fund - - -
Mutual stock funds 5,418,419 7,332,578
Mutual bond fund 3,055,470 - -
Diversification fund - - -
Harnischfeger common
stock fund - - -
Loans to participants - - -
----------- ------------ -------------
Total Investments 3,055,470 5,418,419 7,332,578
----------- ------------ -------------
RECEIVABLES:
Receivables -
Employee contributions 16,550 31,278 43,288
----------- -- ------------ -------------
Total Assets 3,072,020 5,449,697 7,375,866
LIABILITIES:
Payables -
Accrued expenses - - -
- ------------ ------------ -------------
Total Liabilities - - -
------------ ------------ -------------
NET ASSETS AVAILABLE
FOR BENEFITS 3,072,020 5,449,697 7,375,866
=========== =========== ============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
Harnischfeger Fidelity
Common Stock Asset Manager Loans To
Fund Fund Participants
---------- ------------ ----------
<S> <C> <C> <C>
ASSETS: $ $ $
Investments -
Fixed income fund - - -
Mutual stock funds - - -
Mutual bond fund - - -
Diversification fund - 3,072,206 -
Harnischfeger common
stock fund 33,100,688 - -
Loans to participants - - 5,190,823
---------- ---------- -----------
Total Investments 31,100,688 3,072,206 5,190,823
---------- ---------- -----------
RECEIVABLES:
Receivables -
Employee contributions 33,364 13,843 -
---------- ---------- -----------
Total Assets 33,134,052 3,086,049 5,190,823
LIABILITIES:
Payables -
Accrued expenses - - -
--------- ---------- -----------
Total Liabilities - - -
--------- ---------- -----------
NET ASSETS AVAILABLE
FOR BENEFITS 33,134,052 3,086,049 5,190,823
========== ========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
Total
----------
<S> <C>
ASSETS: $
Investments -
Fixed income fund 92,577,208
Mutual stock funds 89,153,952
Mutual bond fund 3,055,470
Diversification fund 3,072,206
Harnischfeger common
stock fund 33,100,688
Loans to participants 5,190,823
----------
Total Investments 226,150,347
----------
RECEIVABLES:
Receivables -
Employee contributions 723,199
----------
Total Assets 226,873,546
LIABILITIES:
Payables -
Accrued expenses 109,603
---------
Total Liabilities 109,603
---------
NET ASSETS AVAILABLE
FOR BENEFITS 226,763,943
==========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1995
<TABLE>
<CAPTION>
Fidelity
Fidelity Equity
Magellan Income Fixed Income
Fund Fund Fund
----------- ----------- -------------
<S> <C> <C> <C>
ASSETS: $ $ $
Investments -
Fixed income fund - - 86,515,627
Mutual stock funds 42,554,483 12,399,609 -
Mutual bond fund - - -
Diversification fund - - -
Harnischfeger common
stock fund - - -
Loans to participants - - -
----------- ----------- -----------
Total Investments 42,554,483 12,399,609 86,515,627
----------- ----------- -----------
LIABILITIES:
Payables -
Accrued expenses - - 98,321
----------- ----------- -----------
Total Liabilities - - 98,321
----------- ----------- -----------
NET ASSETS AVAILABLE
FOR BENEFITS 42,554,483 12,399,609 86,417,306
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1995
<TABLE>
<CAPTION>
Fidelity Fidelity Fidelity
Intermediate Overseas U.S. Equity
Bond Fund Fund Index Fund
------------ ---------- -------------
<S> <C> <C> <C>
ASSETS: $ $ $
Investments -
Fixed income fund - - -
Mutual stock funds - 2,842,068 1,541,520
Mutual bond fund 2,413,078 - -
Diversification fund - - -
Harnischfeger common
stock fund - - -
Loans to participants - - -
---------- --------- ---------
Total Investments 2,413,078 2,842,068 1,541,520
---------- --------- ---------
LIABILITIES:
Payables -
Accrued expenses - - -
--------- --------- ---------
Total Liabilities - - -
--------- --------- ---------
NET ASSETS AVAILABLE
FOR BENEFITS 2,413,078 2,842,068 1,541,520
========= ========= =========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1995
<TABLE>
<CAPTION>
Harnischfeger Fidelity
Common Stock Asset Manager Loans To
Fund Fund Participants
-------------- ------------- ------------
$ $ $
<S> <C> <C> <C>
ASSETS:
Investments -
Fixed income fund - - -
Mutual stock funds - - -
Mutual bond fund - - -
Diversification fund - 1,441,145 -
Harnischfeger common
stock fund 25,003,120 - -
Loans to participants - - 4,423,730
----------- ---------- -----------
Total Investments 25,003,120 1,441,145 4,423,730
----------- ---------- -----------
LIABILITIES:
Payables -
Accrued expenses - - -
---------- ---------- -----------
Total Liabilities - - -
---------- ---------- -----------
NET ASSETS AVAILABLE FOR BENEFITS 25,003,120 1,441,145 4,423,730
========== ========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
OCTOBER 31, 1995
<TABLE>
<CAPTION>
Total
-------------
<S> <C>
ASSETS: $
Investments -
Fixed income fund 86,515,627
Mutual stock funds 59,337,680
Mutual bond fund 2,413,078
Diversification fund 1,441,145
Harnischfeger common
stock fund 25,003,120
Loans to participants 4,423,730
--------------
Total Investments 179,134,380
-------------
LIABILITIES:
Payables -
Accrued expenses 98,321
-------------
Total Liabilities 98,321
-------------
NET ASSETS AVAILABLE FOR BENEFITS 179,036,059
=============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
Fidelity Fidelity
Magellan Equity Income Fixed Income
Fund Fund Fund
------------- ------------- -------------
$ $ $
<S> <C> <C> <C>
Interest and dividend income 9,567,460 1,092,686 5,237,385
Realized (losses) gains on
sales of investments (1,185,031) 208,911 -
Unrealized (depreciation)
appreciation of investments (4,375,827) 2,446,087 -
Employee contributions 5,857,238 2,284,947 6,726,138
Interfund transfers 27,400 3,575,755 (9,605,706)
Withdrawals and distributions (2,505,748) (904,764) (9,580,024)
------------ ------------ -----------
Net Increase (Decrease) 7,385,492 8,703,622 (7,222,207)
J&L Assets Transferred In 741,074 2,347,611 1,632,164
BCH Assets Transferred In - - 136,680
IMPCO Assets Transferred
In 1,400,938 1,197,649 11,761,015
Net assets at beginning
of year 42,554,483 12,399,609 86,417,306
------------ ------------ ------------
Net assets at end of
year 52,081,987 24,648,491 92,724,958
============ ============= ============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
Fidelity Fidelity Fidelity
Intermediate Overseas US Equity
Bond Fund Fund Index Fund
------------ --------- -----------
$ $ $
<S> <C> <C> <C>
Interest and dividend
income 187,310 80,809 97,745
Realized (losses) gains on
sales of investments (10,405) 73,233 190,533
Unrealized (depreciation)
appreciation of
investments (34,199) 247,328 590,256
Employee contributions 497,222 909,160 963,562
Interfund transfers 361,060 1,399,953 1,611,709
Withdrawals and
distributions (493,049) (352,891) (113,688)
---------- ----------- ----------
Net Increase
(Decrease) 507,939 2,357,592 3,340,117
J&L Assets
Transferred In 151,003 250,037 328,673
BCH Assets
Transferred In - - -
IMPCO Assets
Transferred In - - 2,165,556
Net assets at
beginning of
year 2,413,078 2,842,068 1,541,520
------------ ---------- -----------
Net assets at
end of year 3,072,020 5,449,697 7,375,866
=========== ========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
Harnischfeger Fidelity
Common Stock Asset Manager Loans to
Fund Fund Participants
------------- ------------ -------------
$ $ $
<S> <C> <C> <C>
Interest and dividend income 172,015 77,738 -
Realized (losses) gains on
sales of investments 1,924,433 25,267 -
Unrealized (depreciation)
appreciation of investments 5,050,261 176,633 -
Employee contributions 713,045 465,975 -
Interfund transfers 1,421,263 969,476 239,090
Withdrawals and distributions (1,150,085) (70,185) (117,679)
------------ ---------- ----------
Net Increase (Decrease) 8,130,932 1,644,904 121,411
J&L Assets
Transferred In - - 168,604
BCH Assets
Transferred In - - -
IMPCO Assets
Transferred In - - 477,078
Net assets at
beginning of year 25,003,120 1,441,145 4,423,730
------------- ------------ -----------
Net assets at
end of year 33,134,052 3,086,049 5,190,823
============= ============ ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
Total
------
$
<S> <C>
Interest and dividend income 16,513,148
Realized (losses) gains on
sales of investments 1,226,941
Unrealized (depreciation)
appreciation of investments 4,100,539
Employee contributions 18,417,287
Interfund transfers -
Withdrawals and distributions (15,288,113)
-------------
Net Increase (Decrease) 24,969,802
J&L Assets
Transferred In 5,619,166
BCH Assets
Transferred In 136,680
IMPCO Assets
Transferred In 17,002,236
Net assets at
beginning of year 179,036,059
-------------
Net assets at
end of year 226,763,943
=============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1995
<TABLE>
<CAPTION>
Fidelity Fidelity
Magellan Equity Income Fixed Income
Fund Fund Fund
------------ ------------- -------------
$ $ $
<S> <C> <C> <C>
Interest and dividend
income 273,554 924,518 5,526,782
Realized gains (losses) on
sales of investments 1,040,769 10,245 -
Unrealized appreciation
of investments 8,850,237 1,100,878 -
Employee contributions 4,456,006 1,487,694 6,239,848
Interfund transfers (762,972) 882,979 (762,900)
Withdrawals and
distributions (1,924,955) (870,526) (10,632,669)
----------- ---------- -----------
Net Increase (Decrease) 11,932,639 3,535,788 371,061
Oasis Plan Assets
Transferred In 206,296 - 103,890
Syscon Plan Assets
Transferred Out (7,503,400) (2,851,465) (8,505,158)
Net assets at beginning
of year 37,918,948 11,715,286 94,447,513
------------ ------------ ------------
Net assets at end of year 42,554,483 12,399,609 86,417,306
============ =========== ============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
,OR THE YEAR ENDED OCTOBER 31, 1995
<TABLE>
<CAPTION>
Fidelity Fidelity Fidelity
Intermediate Overseas US Equity
Bond Fund Fund Index Fund
------------ -------- ------------
<S> <C> <C> <C>
$ $ $
Interest and dividend
Income 182,326 68,134 41,407
Realized gains (losses) on
sales of investments - 32,001 (125,575) 78,452
Unrealized appreciation
of investments 64,443 24,600 186,949
Employee contributions 470,581 678,203 396,216
Interfund transfers 407,653 (492,568) 346,171
Withdrawals and
distributions (153,903) (208,715) (144,137)
--------- --------- ----------
Net Increase (Decrease) 1,003,101 (55,921) 905,058
Oasis Plan Assets
Transferred In 54,688 123,432 138,903
Syscon Plan Assets
Transferred (1,649,368) (1,013,595) (728,169)
Net assets at
beginning of year 3,004,657 3,788,152 1,225,728
----------- ----------- -----------
Net assets at end
of year 2,413,078 2,842,068 1,541,520
========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1995
<TABLE>
<CAPTION>
Harnischfeger Fidelity
Common Stock Asset Manager Loans to
Fund Fund Participants
------------- ------------- ------------
$ $ $
<S> <C> <C> <C>
Interest and dividend income 340,668 48,831 4,798
Realized gains (losses) on
sales of investments - 545,242 (4,633) -
Unrealized appreciation
of investments 4,784,724 76,787 -
Employee contributions 419,186 284,809 -
Interfund transfers (550,481) 357,228 574,890
Withdrawals and distributions (1,473,176) (44,003) (160,164)
------------ ---------- ----------
Net Increase (Decrease) 4,066,163 719,019 419,524
Oasis Plan Assets Transferred In - 58,693 44,468
Syscon Plan Assets Transferred (406,834) (270,992) (711,117)
Net assets at beginning of year 21,343,791 934,425 4,670,855
------------ ----------- -----------
Net assets at end of year 25,003,120 1,441,145 4,423,730
============ =========== ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1995
<TABLE>
<CAPTION>
Total
------
$
<S> <C>
Interest and dividend income 7,411,018
Realized gains (losses) on
sales of investments - 1,576,501
Unrealized appreciation
of investments 15,088,618
Employee contributions 14,432,543
Interfund transfers -
Withdrawals and distributions (15,612,248)
------------
Net Increase (Decrease) 22,896,432
Oasis Plan Assets Transferred In 730,370
Syscon Plan Assets Transferred (23,640,098)
Net assets at beginning of year 179,049,355
------------
Net assets at end of year 179,036,059
============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
HARNISCHFEGER INDUSTRIES EMPLOYEES' SAVINGS PLAN
-----------------------------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
OCTOBER 31, 1996 AND 1995
--------------------------
(1) PLAN HISTORY
Harnischfeger Corporation established the
Harnischfeger Corporation Employee Savings and
Protection Plan effective April 1, 1984 (the
"Harnischfeger Plan"). Effective March 2, 1987,
sponsorship of the Harnischfeger Plan was assumed by
Harnischfeger Industries, Inc. (the "Company") and
the Plan was renamed the Harnischfeger Industries
Employees' Savings Plan (the "Plan"). The Plan was
amended and restated July 1, 1995 to incorporate all
previous Plan amendments including the Optical
Alignment Systems and Inspection Services, Inc.
("OASIS") plan merger on May 1, 1995. The term
"Company" as used in these financial statements
refers to Harnischfeger Industries, Inc. and its
subsidiaries excluding Joy Technologies Inc. and
Dobson Park Industries plc.
Plan assets merged into the Plan during 1996 were
J&L Fiber Services, Inc. ("J&L") on February 1,
1996, Birmingham Crane & Hoist, Inc. ("BCH") on
April 15, 1996 and the Pulp Machinery Division of
Ingersoll-Rand Company ("IMPCO") on July 15, 1996.
Effective February 16, 1995, the Company completed
the sale of Syscon Corporation to Logicon, Inc.
Account balances of participants employed by Syscon
and its subsidiaries were transferred to an existing
Logicon defined contribution retirement plan on
April 28, 1995.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
------------------------
The accompanying financial statements have been
prepared on the accrual basis.
Investments
----------------
Investments are stated at fair market value except
guaranteed investment contracts which are stated at
contract value. Contract value represents
contributions made under the contract, plus interest
at the contract rate, less participant withdrawals.
Unrealized gains and losses on investments are
computed based upon market values at the beginning
of the year, or acquisition cost if acquired during
the year, and market values at the end of the year.
Realized gains and losses are recorded based upon
market values at the time of sale.
(3) PLAN PROVISIONS
The following description of the Plan provides only
general information. Participants should refer to
the Plan Document for a more complete description of
the Plan's provisions.
Plan Purpose
----------------
The purposes of the Plan are to encourage savings by
employees and to assist them in meeting major
financial needs, supplementing retirement benefits
and acquiring an equity interest in the Company.
Plan Administration
------------------------
The Plan is administered by a seven-member Pension
and Investment Committee (the "Committee").
The assets of the Plan are trusteed by Fidelity
Management Trust Company ("Fidelity") and detailed
records of participants' accounts are maintained by
Fidelity Institutional Retirement Services Company.
Substantially all administrative expenses of the
Plan are paid or accrued for by the Company.
Eligibility
----------------
Substantially every U.S. employee of the Company
(except any employee who is covered by a collective
bargaining agreement which does not provide for such
employee's participation in the Plan, employees of
J&L and BCH through January 31, 1996, employees of
Carolina Material Handling ("CMH") through April 30,
1996 and employees of IMPCO through May 30, 1996)
who has been employed for at least thirty calendar
days is eligible to participate in the Plan. An
eligible employee may become an active participant
in the Plan on the first day of any month in which
he meets all of the requirements for eligibility.
The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974
("ERISA").
Contributions
----------------
Participants may elect to make regular contributions
to the Plan of up to ten percent of their pre-tax
earnings ("salary reduction contributions").
Participants may also make additional contributions
of up to ten percent of after-tax earnings. Pre-tax
contributions are subject to Internal Revenue
Service guidelines.
The Company may, at its discretion, make a profit
sharing contribution as determined by the Company.
There were no Company contributions made to the Plan
for fiscal years ended 1996 and 1995. Company
profit sharing contributions are allocated to each
active participant on a pro rata basis on such
employee's base earnings, up to $100,000, for the
fiscal year ended October 31. The Company profit
sharing contributions are invested 100 percent in
the Harnischfeger Common Stock Fund.
Investment Options
------------------------
Each participant elects to invest his contribution
in one or more of the investment funds offered under
the Plan. Such elections are made directly to
Fidelity at the discretion of the participant. The
investment funds currently available to Plan
participants are as follows:
Fidelity Magellan Fund
------------------------
This is a capital appreciation mutual fund
which invests primarily in common stocks of
companies which are expected to demonstrate
long-term earnings growth greater than the
economy as a whole. This fund had 2,934 and
2,302 participants at October 31, 1996 and
1995, respectively.
Fidelity Equity Income Fund
-------------------------------
This stock fund, which had 1,732 and 1,161
participants as of October 31, 1996 and
1995, respectively, invests in income-producing common
stocks or preferred stocks
whose prospects for appreciation in both
value and dividend income are deemed
favorable. The fund looks for a dividend
yield that exceeds the average yield of the
"Standard & Poor's 500".
Fixed Income Fund
-----------------------
This fund invests primarily (i) in
government obligations, treasury bills,
certificates of deposit, commercial paper,
bonds, notes and other evidences of
indebtedness and other obligations of a
similar nature expected to produce a fixed
income, (ii) in a deposit account, deposit
administration fund, guaranteed investment
contract ("GIC") or similar fund or contract
maintained by a legal reserve life insurance
company pursuant to an agreement with or a
group annuity contract issued by such
insurance company, or (iii) in a combination
of investments permitted under (i) and (ii)
above. This fund had 3,503 and 3,181
participants as of October 31, 1996 and
1995, respectively.
Fidelity Intermediate Bond Fund
-------------------------------
This fund invests in high and upper medium
grade fixed-income obligations with an
average maturity of three to ten years.
Investments include obligations (i) of U.S.
and foreign corporations, (ii) issued or
guaranteed by the U.S. government or any of
its agencies, (iii) of U.S. banks, including
certificates of deposit and bankers'
acceptances, and (iv) other instruments of
comparable quality to those mentioned above,
which are expected to produce attractive
levels of current income. There were 606
and 476 participants as of October 31, 1996
and 1995, respectively.
Fidelity Overseas Fund
-----------------------
The Overseas fund seeks long-term capital
appreciation primarily through investments
in foreign securities. There were 818
participants at October 31, 1996 and 500
participants at October 31, 1995.
Fidelity U.S. Equity Index Fund
-------------------------------
This fund seeks investment results that
correspond to the total return performance
of the Standard & Poor's 500 Stock Index.
The total return performance is the
combination of capital changes and income.
At October 31, 1996 and 1995, this fund had
761 and 310 participants, respectively.
Harnischfeger Common Stock Fund
-------------------------------
This fund invests exclusively in the common
stock of Harnischfeger Industries, Inc. The
fund encourages employee ownership while
seeking long-term capital appreciation. At
October 31, 1996 and 1995, this fund had
3,504 and 3,692 participants, respectively.
Fidelity Asset Manager Fund
-------------------------------
This mutual fund maintains a mix of
investments in domestic and foreign stocks,
bonds, and short-term instruments with the
expectation of achieving a long-term high
total return. This fund had 360
participants at October 31, 1996 and 188
participants at October 31, 1995.
Vesting of Participant Accounts
--------------------------------
Participants vest in accordance with the plan
provisions defined in the Plan Document.
Participant Loans
----------------
Participants are allowed to obtain loans from the
Plan which are drawn against their investment
accounts, subject to limitations of the Plan, and
bear interest rates of 2% over prime as of the date
of the loan.
Distributions
----------------
Upon termination of employment with the Company for
any reason, including resignation, retirement,
dismissal, long-term disability or death,
participants (or designated beneficiaries) are paid
the vested amounts due them by payment in: (1) a
lump sum, or (2) substantially equal quarterly or
annual installments over a period not to exceed the
lesser of (a) 10 years or (b) the life expectancy of
the participant or, if the participant has
designated a beneficiary who is an individual, the
joint and last survivor expectancy of the
participant and his designated beneficiary or (3) a
combination of a lump sum and installment payments.
Payment may be made in cash or property (fair market
value at date of distribution as determined by the
trustee). Participants may request that
distribution of their accounts be invested in the
Harnischfeger Common Stock Fund.
In the event of financial hardship, a participant
may apply for a withdrawal of all or any portion of
the salary reduction contributions credited to his
account. Withdrawals during employment of salary
reduction contributions may be granted by the
Committee only if the participant can demonstrate to
the satisfaction of the Committee that a financial
hardship exists within the definitions of the
Internal Revenue Code.
(4) PLAN TERMINATION
The Company has the right under the Plan to
discontinue its contributions at any time and to
terminate the Plan subject to the provisions of
ERISA. In the event of Plan termination,
participants will become 100% vested in their
accounts.
(5) FEDERAL INCOME TAXES
The Internal Revenue Service has determined and
informed the Company by a letter dated June 25, 1996
that the Plan and related trust are designed in
accordance with applicable sections of the Internal
Revenue Code ("IRC"). As the Plan is qualified
under the provisions of Section 401(a) of the IRC,
it is exempted from federal income taxes.
Therefore, no provision for income taxes has been
included in the Plan's financial statements.
With respect to participants, pre-tax contributions
to the Plan are excluded from wages subject to
federal and most state income taxes. Earnings on
contributions are not taxable until distributed.
<PAGE>
(6) INVESTMENTS
The following relates to investment shares, net asset values
and market value at October 31.
<TABLE>
<CAPTION>
1996
---------------------------------------------------
Net
Number Asset Fair Market
Funds of Shares Value Value
- ------------------------ -------------- ---------------- ----------------
<S> <C> <C> <C>
Investments at Fair Value as
Determined
by Quoted Market Price:
Fidelity Magellan Fund 666,010.8 $77.85 $ 51,848,938
Fidelity Equity Income
Fund 580,885.2 42.27 24,554,017
Fidelity Intermediate
Bond Fund 302,222.5 10.11 3,055,470
Fidelity Overseas Fund 174,337.8 31.08 5,418,419
Fidelity U.S. Equity
Index Fund 283,768.5 25.84 7,332,578
Fidelity Asset Manager
Fund 181,679.8 16.91 3,072,206
Harnischfeger Common
Stock Fund 827,517.2 40.00 33,100,688
Investments at Estimated
Fair Value:
Loans to Participants - 1.00 5,190,823
Investments at Contract Value: - 1.00 92,577,208
-------------
$226,150,347
-------------
</TABLE>
The following information relates to investment
gain (loss) activity during the periods.
<TABLE>
<CAPTION>
Realized Gains (Losses)
-----------------------
Fund 1996 1995
- -------------------------------- ----------- ------------
<S> <C> <C>
Fidelity Magellan Fund $(1,185,031) $1,040,769
Fidelity Equity Income Fund 208,911 10,245
Fidelity Intermediate Bond Fund (10,405) 32,001
Fidelity Overseas Fund 73,233 (125,575)
Fidelity U.S. Equity Index Fund 190,533 78,452
Fidelity Asset Manager Fund 25,267 (4,633)
Harnischfeger Common Stock Fund 1,924,433 545,242
----------- -----------
$1,226,941 $1,576,501
=========== ===========
</TABLE>
(6) INVESTMENTS
The following relates to investment shares, net
asset values and market value at October 31.
<TABLE>
<CAPTION>
1995
----------------------------------------
Net
Number Asset Fair Market
Funds of Shares Value Value
- ------------------------ ------------- ---------- -----------
<S> <C> <C> <C>
Investments at Fair Value
as Determined
by Quoted Market Price:
Fidelity Magellan Fund 472,880.1 $89.99 $ 42,554,483
Fidelity Equity Income Fund 339,994.8 36.47 12,399,609
Fidelity Intermediate Bond Fund 234,507.1 10.29 2,413,078
Fidelity Overseas Fund 99,442.5 28.58 2,842,068
Fidelity U.S. Equity Index Fund 71,832.3 21.46 1,541,520
Fidelity Asset Manager Fund 93,459.4 15.42 1,441,145
Harnischfeger Common Stock Fund 794,428.3 31.47 25,003,120
Investments at Estimated Fair Value:
Loans to Participants - 1.00 4,423,730
Investments at Contract Value:
Fixed Income Fund - 1.00 86,515,627
-------------
$179,134,380
=============
</TABLE>
The following information relates to investment gain
(loss) activity during the periods.
<TABLE>
<CAPTION>
Change in Unrealized
Appreciation (Depreciation)
-----------------------------
Fund 1996 1995
- ---------------------- ----------- --------------- ------------
<S> <C> <C>
Fidelity Magellan Fund $(4,375,827) $ 8,850,237
Fidelity Equity Income Fund 2,446,087 1,100,878
Fidelity Intermediate Bond Fund (34,199) 64,443
Fidelity Overseas Fund 247,328 24,600
Fidelity U.S. Equity Index Fund 590,256 186,949
Fidelity Asset Manager Fund 176,633 76,787
Harnischfeger Common Stock Fund 5,050,261 4,784,724
------------ ------------
$ 4,100,539 $15,088,618
============ ============
</TABLE> <PAGE>
HARNISCHFEGER INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN Additional
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES Information
OCTOBER 31, 1996 Schedule I
<TABLE>
<CAPTION>
Description of
Identity of Issue Investment
- ---------------------------------------------- ----------------
<S> <C>
Employer's Stock Fund:
- ---------------------
Harnischfeger Industries, Inc. Common Stock Common Stock
Mutual Funds:
Fidelity Equity Income Fund
Fidelity Magellan Fund Open-end
Fidelity Overseas Fund Mutual
Fidelity U.S. Equity Index Fund Funds
Fidelity Intermediate Bond Fund
Diversification Fund:
- --------------------
Fidelity Asset Manager Open-end
Fixed Income Securities:
- -----------------------
Fidelity Cash Portfolio, at 5.33% Open-end
Lincoln National Guaranteed Investment
Contract, at rates
ranging from 6.08% to 7.82% Sept., 1997 thru June, 1999
AIG Financial Products MBS at 5.64% November, 1996
Prudential Insurance Company of
America Guaranteed
Investment Contract, at rates ranging
from 2.46% to 4.51% Dec., 97 thru Sept. 98
CDC Capital Guaranteed Investment
Contract, at 6.15% March, 1997
Provident Life & Accident Guaranteed
Investment Contract, at 5.85% December, 1998
Sun Life of Canada Guaranteed
Investment Contract, at
rates ranging from 6.74% to 6.99% Mar., 2000 thru June, 2000
Connecticut General Guaranteed
Investment Contract, at 7.35% December, 1996
Deutsche Bank Guaranteed Investment
Contract, at rates ranging
from 5.62% to 6.09% November, 1996
New England Mutual Guaranteed
Investment Contract,
at rates ranging from 4.55% to 6.0% Dec., 1998 thru Dec., 2001
New York Life Guaranteed
Investment Contract, at 6.05% September, 1998
Ohio National Life Insurance
Company at 5.90% September, 1999
Peoples Security Life, at 7.31% August, 2001
Principal Mutual at 7.2% May, 2001
Protective Life Guaranteed Investment, at 6.05% June 30, 1998
Safeco Life Insurance at 7.14% September, 1997
Security Life of Denver at 6.07% February, 1997
SunAmerica Life Insurance
Guaranteed Investment Contract,
at 6.02% December, 1998
Transamerica Occidental at 5.58% December, 1996
Outstanding Loan Balance
Total Assets Held For Investment
</TABLE>
HARNISCHFEGER INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN Additional
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES Information
OCTOBER 31, 1996 Schedule I
<TABLE>
<CAPTION>
Cost Fair Market
Identity of Issue of Asset Value
- ----------------------------- ----------- ----------
<S> <C> <C>
Employer's Stock Fund:
- ----------------------
Harnischfeger Industries, Inc.
Common Stock $18,019,916 $33,100,688
Mutual Funds:
- ------------
Fidelity Equity Income Fund 19,609,360 24,554,017
Fidelity Magellan Fund 46,300,095 51,848,938
Fidelity Overseas Fund 5,050,254 5,418,419
Fidelity U.S. Equity Index Fund 6,434,452 7,332,578
Fidelity Intermediate Bond Fund 3,085,796 3,055,470
----------- -----------
80,479,957 92,209,422
Diversification Fund:
- --------------------
Fidelity Asset Manager 2,835,182 3,072,206
Fixed Income Securities:
- -----------------------
Fidelity Cash Portfolio, at 5.33% 4,340,751 4,340,751
Lincoln National Guaranteed Investment
Contract, at rates
ranging from 6.08% to 7.82% 7,264,665 7,264,665
AIG Financial Products MBS at 5.64% 2,926,956 2,926,956
Prudential Insurance Company
of America Guaranteed
Investment Contract, at rates
ranging from 2.46% to 4.51% 5,623,946 5,623,946
CDC Capital Guaranteed Investment
Contract, at 6.15% 3,015,203 3,015,203
Provident Life & Accident Guaranteed
Investment Contract, at 5.85% ` 4,401,734 4,401,734
Sun Life of Canada Guaranteed
Investment Contract, at
rates ranging from 6.74% to 6.99% 9,677,975 9,677,975
Connecticut General Guaranteed
Investment Contract, at 7.35% 7,742,086 7,742,086
Deutsche Bank Guaranteed Investment
Contract, at rates ranging
from 5.62% to 6.09% 10,630,194 10,630,194
New England Mutual Guaranteed
Investment Contract,
at rates ranging from 4.55% to 6.0% 111,338 111,338
New York Life Guaranteed Investment
Contract, at 6.05% 4,324,022 4,324,022
Ohio National Life Insurance
Company at 5.90% 4,192,977 4,192,977
Peoples Security Life, at 7.31% 4,032,947 4,032,947
Principal Mutual at 7.2% 4,040,587 4,040,587
Protective Life Guaranteed
Investment, at 6.05% 3,243,016 3,243,016
Safeco Life Insurance at 7.14% 4,041,428 4,041,428
Security Life of Denver at 6.07% 4,785,853 4,785,853
SunAmerica Life Insurance
Guaranteed Investment Contract,
at 6.02% 4,165,512 4,165,512
Transamerica Occidental at 5.58% 4,016,018 4,016,018
----------- -----------
92,577,208 92,577,208
Outstanding Loan Balance 5,190,823 5,190,823
------------ ------------
Total Assets Held For Investment $199,103,086 $226,150,347
============ ============
</TABLE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' Additional
SAVINGS PLAN Information
5500-ITEM 27(d) Schedule II
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
IDENTITY OF DESCRIPTION PURCHASE
PARTY INVOLVED OF ASSET PRICE
- ------------------- -------------- -------------
<S> <C> <C>
Prudential Insurance Co. Guaranteed Investment
1 Sale Contract
FMTC Inst. Money Market Money Market Securities
364 Purchases $62,836,025
474 Sales
Magellan Mutual Fund
232 Purchases $23,089,768
210 Sales
Equity IncomeIncome Fund Income Fund
220 Purchases $11,965,005
148 Sales
</TABLE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' Additional
SAVINGS PLAN Information
5500-ITEM 27(d) Schedule II
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION> EXPENSE
IDENTITY OF SELLING LEASE INCURRED WITH
PARTY INVOLVED PRICE RENTAL TRANSACTION
- -------------- ----------------
<S> <C> <C> <C>
Prudential Insurance Co.
1 Sale $10,579,698 N/A None
FMTC Inst. Money Market
364 Purchases
474 Sales $61,467,703 N/A None
Magellan
232 Purchases
210 Sales $8,234,456 N/A None
Equity Income
220 Purchases
148 Sales $2,465,596 N/A None
</TABLE>
HARNISCHFEGER INDUSTRIES EMPLOYEES' Additional
SAVINGS PLAN Information
5500-ITEM 27(d) Schedule II
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
CURRENT VALUE
IDENTITY OF COST OF OF ASSET ON NET
PARTY INVOLVED ASSET TRANSACTION DATE GAIN(LOSS)
- ------------------------ ----------- ---------------- ----------
<S> <C> <C> <C>
Prudential Insurance Co.
1 Sale $10,579,698 $10,579,698 None.
FMTC Inst. Money Market
364 Purchases $62,836,025
474 Sales $61,467,703 $61,467,703 None.
Magellan
232 Purchases $23,089,768
210 Sales $7,525,456 $8,234,456 $709,000
Equity Income
220 Purchases $11,965,005
148 Sales $2,124,679 $2,465,596 $340,917
</TABLE>
SIGNATURES
-----------
Pursuant to the requirements of the Securities
Exchange Act of 1934, the trustees (or other
persons who administer the employee benefit plan)
have duly caused this annual report to be signed
by the undersigned thereunto duly authorized.
HARNISCHFEGER INDUSTRIES
EMPLOYEES' SAVINGS PLAN
(Name of Plan)
Date: April 29, 1997
By: /s/Francis M. Corby, Jr.
-------------------------
Francis M. Corby, Jr.
Executive Vice President For
Finance and Administration
and Chief Financial Officer
Harnischfeger Industries, Inc.
CONSENT OF INDEPENDENT ACCOUNTANTS
-----------------------------------
We hereby consent to the incorporation by
reference in the Registration Statement on Form S-8 (No. 33-23985)
of Harnischfeger Industries, Inc.
of our report dated April 23, 1997 appearing on
page 1 of this Annual Report on Form 11-K.
Price Waterhouse LLP
Milwaukee, Wisconsin
April 28, 1997
