SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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, 1994
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 33-28812
HYSTER - YALE MATERIALS HANDLING, INC.
(Exact name of registrant as specified in its charter).
Delaware 34-1617886
(State or other jurisdiction of (IRS Employeridentification No.)
incorporation or organization)
2701 NW Vaughn, Portland, Oregon 97210
(Address of principal executive offices) (Zip code)
(503) 721-6000
Registrant's telephone number, including area code
NONE
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 Common Stock outstanding at July 31, 1994:
5,598.857
<PAGE>
HYSTER-YALE MATERIALS HANDLING, INC.
TABLE OF CONTENTS
Part I. FINANCIAL INFORMATION
PAGE NO.
Item 1 - Financial Statements
Unaudited Consolidated Balance Sheets - June 30, 1994
and December 31, 1993 3
Unaudited Consolidated Statements of Income - for the Three
Months and Six Months ended June 30, 1994 and 1993 4
Unaudited Consolidated Statements of Cash Flows - for the
Six Months ended June 30, 1994 and 1993 5
Notes to Unaudited Consolidated Financial Statements 6-7
Item 2 - Management's Discussion and Analysis of Results of
Operations
and Financial Condition 8-12
Part II. OTHER INFORMATION 13-15
<PAGE>
PART I
ITEM 1 - Financial Statements
<TABLE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
<CAPTION>
JUNE 30 DECEMBER 31
1994 1993
ASSETS (in thousands)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 32,307 $ 20,255
Accounts receivable, net 145,972 104,959
Inventories 181,145 151,216
Assets held for sale 11,939 11,991
Deferred income taxes 6,874 6,639
Prepaid expenses and other 8,092 7,547
------- -------
386,329 302,607
Other Assets, net 9,502 9,969
Property, Plant and Equipment, net 125,959 121,732
Deferred Charges:
Goodwill, net 378,513 383,927
Other, net 12,070 14,800
------- -------
390,583 398,727
$912,373 $833,035
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $145,754 $ 97,753
Short-term obligations 18,217 7,853
Current maturities of 85,170 28,388
long-term obligations
Accrued expenses 74,056 66,664
Accrued income taxes 15,213 22,266
Deferred income taxes 1,488 2,383
------- -------
339,898 225,307
Other Liabilities 46,780 46,079
Deferred Income Taxes 14,412 14,180
Long-Term Obligations 221,007 290,343
Stockholders' Equity:
Common Stock 6 6
Capital in excess of par value 203,192 178,192
Retained income 85,813 82,875
Foreign currency translation 1,265 (3,947)
adjustment and other ------- -------
290,276 257,126
------- --------
$912,373 $833,035
======== ========
<FN>
See notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
Six Months Ended Six Months Ended
JUNE 30 JUNE 30
(In thousands) (In thousands)
1994 1993 1994 1993
<S> <C> <C>
Net sales $290,358 $228,684 $535,686 $443,364
Cost of sales 230,558 182,424 425,356 352,131
------- ------- ------- -------
Gross profit 59,800 46,260 110,330 91,233
Selling, administrative
and general expenses 37,268 35,591 74,012 68,302
Goodwill amortization 2,711 2,711 5,422 5,422
------ ----- ------ ------
Operating profit 19,821 7,958 30,896 17,509
Other income (expense):
Interest income 241 204 387 327
Interest expense (9,216) (10,671) (17,942) (21,124)
Other, net 123 603 (517) (34)
------- ------- -------- --------
(8,852) (9,864) (18,072) (20,831)
------- ------- -------- --------
Income (loss) before
income taxes and
extraordinary charge 10,969 (1,906) 12,824 (3,322)
Income tax provision 5,675 (1,669) 6,668 (2,314)
(benefit) ----- ------- ----- -------
Income (loss) before
extraordinary charge 5,294 (237) 6,156 (1,008)
Extraordinary charge, (3,218) (3,292) (3,218) (3,292)
net of tax ------- ------- ------- -------
Net income (loss) $2,076 $(3,529) $2,938 $(4,300)
====== ======== ====== ========
<FN>
See notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Six Months Ended
JUNE 30
(In thousands)
1994 1993
<S> <C> <C>
Operating Activities:
Net income (loss) $2,938 $(4,300)
Adjustments to reconcile net income
(loss) to net cash provided (used)
by operating activities
Extraordinary charge, net of tax 3,218 3,292
Depreciation and amortization 16,245 15,932
Deferred income taxes (949) (1,565)
Reserves for self-insurance 455 2,605
Other, net 791 96
Working Capital Changes:
Accounts receivable (10,964) (15,916)
Inventories (26,019) (3,827)
Accounts payable 43,829 14,569
Other current assets (360) 3,016
Other current liabilities (3,020) (9,205)
Net cash provided by ------- -------
operating activities 26,164 4,697
Investing Activities: ------- -------
Expenditures for property,
plant and equipment (13,867) (9,700)
Other 454 12
Net cash (used) -------- -------
by investing activities (13,413) (9,688)
Financing Activities:
Additions to long-term - -
obligations
Reduction of long-term obligations (12,672) (542)
Revolving credit facilities, net - 1,400
Short-term obligations, net 8,347 4,925
Other 1,179 1,536
Net cash provided (used) ----- -----
by financing activities (3,146) 7,319
------- -----
Effect of exchange rate 2,447 (760)
changes on cash ------ -----
Cash and Cash Equivalents:
Increase (decrease) for the period 12,052 1,568
Balance at the beginning of period 20,255 7,865
------ -----
Balance at the end of period $ 32,307 $ 9,433
======== =======
<FN>
See notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1994
Note A - Basis of Presentation
The accompanying unaudited consolidated financial
statements of Hyster-Yale Materials Handling, Inc. and
subsidiaries (the Company) include the accounts of
Hyster-Yale Materials Handling, Inc. (Hyster-Yale), a 97%
owned subsidiary of NACCO Industries, Inc. (NACCO), and
its wholly-owned subsidiaries NACCO Materials Handling
Group, Inc. and NACCO Materials Handling Holding Co. The
Company primarily does business as NACCO Materials
Handling Group, Inc. with two product brands, Hyster and
Yale.
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, 1994, and the results of its
operations for the three month and six month periods and
cash flows for the six month periods ended June 30, 1994
and 1993 have been included.
Operating results for the three month and six month
periods ended June 30, 1994 are not necessarily
indicative of the results that may be expected for the
year ended December 31, 1994. 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, 1993.
Operating profit in prior periods' consolidated financial
statements has been restated to reflect the
reclassification of goodwill amortization as a component
of operating expenses. Certain other amounts in the
prior periods' unaudited consolidated financial
statements have been reclassified to conform to the
current periods' presentation.
Note B - Extraordinary Charge
The 1994 extraordinary charge of $3.2 million, net of
$2.0 million in tax benefits, represents the write-off of
premiums and unamortized debt issuance costs associated
with the expected retirement of $71.4 million of the
Company's 12-3/8% subordinated debentures. The Company
retired $47.6 million of debentures in August, 1994 using
internally generated funds and a $25 million equity
contribution from existing shareholders. The equity
contribution which occurred on August 1, 1994 is recorded
on the consolidated balance sheet at June 30, 1994
as accounts receivable and was treated as a non
cash transaction for the six month period ended
June 30, 1994.
<PAGE>
The Company also amended its existing senior bank credit
agreement during the second quarter to permit the
accelerated use of $25 million to retire additional
subordinated debentures. It is the Company's intention to
retire this debt as the funds are generated through
operations and other cash enhancement activities.
The existing senior bank credit agreement also permits a
further $25 million of subordinated debentures to be
retired when the Company achieves a 43% debt to total
capitalization ratio as defined in the agreement.
The 1993 extraordinary charge related to retirement of
approximately $50 million of subordinated debentures.
Note C - Inventories
<TABLE>
Inventories are summarized as follows:
<CAPTION>
JUNE 30 DECEMBER 31
1994 1993
(In thousands) (In thousands)
<S> <C> <C>
Finished goods and service parts $ 84,789 $ 81,549
Raw materials and work in progress 107,998 80,304
LIFO Reserve (11,642) (10,637)
-------- --------
Total $181,145 $151,216
======== ========
</TABLE>
The cost of inventories has been determined by the last-
in first-out (LIFO) method for 62% and 61% of such
inventories as of June 30, 1994 and December 31, 1993,
respectively.
<PAGE>
ITEM 2 - Management's Discussion and Analysis of Results
of Operations and Financial Condition
FINANCIAL REVIEW
<TABLE>
The results of operations for the Company were as follows
for June 30:
<CAPTION>
Three Months Ended Six Months Ended
JUNE 30 JUNE 30
(In millions) (In millions)
1994 1993 1994 1993
<S> <C> <C>
Revenues
Americas $ 203.1 $ 156.5 $ 377.2 $ 312.0
Europe, Africa and 70.8 60.9 129.4 110.0
Middle East
Australia and Far East 16.5 11.3 29.1 21.4
------- ------- ------- -------
$ 290.4 $ 228.7 $ 535.7 $ 443.4
======= ======= ======= =======
Operating profit
Americas $ 14.8 $ 7.6 $ 24.2 $ 17.8
Europe, Africa and 3.4 (0.1) 4.0 (1.2)
Middle East
Australia and Far East 1.6 0.4 2.7 0.9
------ ----- ------ ------
$ 19.8 $ 7.9 $ 30.9 $ 17.5
====== ===== ====== ======
Operating profit excluding
goodwill amortization
Americas $ 16.8 $ 9.6 $ 28.2 $ 21.8
Europe, Africa and 4.1 0.6 5.4 0.1
Middle East
Australia and Far East 1.6 0.4 2.7 1.0
------ ------ ------ ------
$ 22.5 $ 10.6 $ 36.3 $ 22.9
====== ====== ====== ======
</TABLE>
<PAGE>
Second Quarter of 1994 Compared with Second Quarter of 1993
<TABLE>
The following schedule details the components of the changes
in revenues, operating profit and net income (loss) for the
second quarter of 1994 compared with 1993.
<CAPTION>
Net
Operating Income
Revenues Profit (Loss)
-------- ------ ------
(In millions)
<S> <C> <C> <C>
1993 $228.7 $7.9 $(3.5)
Increase (Decrease) in 1994 from:
Lift truck unit volume 48.9 9.7 6.4
Sales mix 7.1 2.9 1.9
Average sales price 3.1 3.1 2.1
Service parts 4.8 2.0 1.3
Manufacturing cost (0.3) (0.2)
Other operating expense (5.2) (3.4)
Foreign currency (2.2) (0.3) (0.2)
Other income and expense 0.6
Differences between effective (2.9)
and statutory tax rates ------ ----- ----
1994 $290.4 $19.8 $2.1
====== ===== ====
</TABLE>
Increased unit volume in 1994 reflects the continued
economic improvement in North America and gains in global
market share. Most European and the Japanese markets
remained slow. While price discounting continues to be
prevalent in the forklift industry, pricing has improved
slightly, primarily in North America. The positive mix
results from increased sales of higher value lift trucks
in 1994 due to new product introductions in late 1993.
The service parts business continues to improve worldwide
due to the strength of the economy in North America, and
new marketing programs and dealers in Europe.
Other operating expenses have increased due to higher
marketing and engineering costs to support new product
introductions and volume related customer service costs.
The Company's backlog of orders at June 30, 1994 was
approximately 22,000 units compared to 12,000 units at
December 31, 1993. Backlog has increased due to a
significant increase in orders in North America and
Europe. The strong 1994 order rate has resulted in
longer lead times for selected models. Management
believes that the backlog level is consistent with
overall increases in industry backlog levels. The
Company is aggressively moving to reduce delivery lead
times.
<PAGE>
Six Months Ended June 30, 1994 Compared with Six Months
ended June 30, 1993
<TABLE>
The following schedule details the components of the changes
in revenues, operating profit and net income (loss) for the
six months ended June 30, 1994 compared with 1993:
<CAPTION>
Net
Operating Income
Revenues Profit (Loss)
-------- ------ ------
(In millions)
<S> <C> <C> <C>
1993 $443.4 $17.5 $(4.3)
Increase (Decrease) in 1994 from:
Lift truck unit volume 73.5 14.2 9.4
Sales mix 9.1 4.0 2.6
Average sales price 4.6 4.6 3.0
Service parts 8.8 3.4 2.2
Manufacturing cost 0.8 0.5
Other operating expense (9.3) (6.1)
Foreign currency (3.7) (4.3) (2.8)
Other income and expense 1.9
Differences between effective
and statutory tax rates (3.4)
Change in statutory tax rate (0.1)
------ ----- ----
1994 $535.7 $30.9 $2.9
====== ===== ====
</TABLE>
The results for the six months of 1994 versus 1993
improved significantly due to large volume increases
consistent with the second quarter comparison above. The
improvements in sales mix are attributable to new product
introductions in late 1993 that increased sales of higher
value lift trucks.
Increased other operating expense is due to higher
marketing and engineering costs related to new product
introductions and market share gain strategies along with
volume related customer service costs. The negative
foreign currency effect on revenues is caused by
translation of a weaker Pound Sterling to the U.S. Dollar
while operating profit was adversely affected by the
strong Japanese Yen which increased the cost of product
sourced from Japan.
<PAGE>
Other Income and Expense
Items of other income (expense) were as follows for the
periods ended June 30:
Three Months Ended Six Months Ended
June 30 June 30
------------------ ----------------
(In Millions)
1994 1993 1994 1993
---- ---- ---- ----
Interest Income $0.2 $0.2 $0.4 $0.3
Interest Expense (9.2) (10.7) (17.9) (21.1)
Other - net 0.1 0.6 (0.5) 0.0
The reduction in interest expense in 1994 is due to lower
levels of debt in 1994 after the 1993 debt restructuring.
Other-net in 1993 included a $2.1 million gain from the
sale of a former plant site. Included in other net are
the improved 1994 results of Sumitomo Yale, a 50% owned
joint venture, as compared with the same periods in 1993.
Provision for Income Taxes
The effective income tax rates for the periods ended June 30
were as follows:
Three Months Six Months
Ended June 30 Ended June 30
------------- -------------
(In Millions)
1994 1993 1994 1993
---- ---- ---- ----
Income (loss) before income taxes
and extraordinary charge $11.0 $(1.9) $12.8 $(3.3)
Provision (benefit) for income taxes $ 5.7 $(1.7) $ 6.7 $(2.3)
Effective income tax rate 52% 88% 52% 70%
The higher effective tax rates in 1993 were due to the
relatively low level of projected 1993 full year income
which allowed permanent differences (primarily goodwill
amortization) to affect the rate dramatically.
Extraordinary Charges
The extraordinary charges of $3.2 million, net of $2.0
million in tax benefits in 1994 and $3.3 million, net of
$2.0 million in tax benefits in 1993, represent the write-
off of premiums and unamortized debt issuance costs
associated with the partial redemption of the Company's
12-3/8% subordinated debentures.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
Expenditures for property, plant and equipment were $7.6
million and $13.9 million for the second quarter and six
months of 1994, respectively. The majority of these
expenditures were for manufacturing expansion and tooling
related to future production of new products. Estimated
capital expenditures for the remainder of 1994 will be
approximately $12.1 million. Principal sources of
financing these capital expenditures are internally
generated funds, bank borrowings and government
assistance grants.
The Company retired $47.6 million of subordinated
debentures in August, 1994 using internally generated
funds and a $25 million equity contribution from existing
shareholders. The Company also amended its existing
senior bank credit agreement during the second quarter to
permit the accelerated use of $25 million to retire
additional subordinated debentures in 1994. It is the
Company's intent to retire this debt as funds are
available. A variety of working capital cash enhancement
activities are in process to increase cash available for
debt retirement.
The existing senior bank credit agreement also permits a
further $25 million of subordinated debentures to be
retired when the Company achieves a 43% debt to total
capitalization ratio as defined in the agreement.
The Company believes it can meet all of its current and
long-term commitments and operating needs through
internally generated funds and borrowings available under
committed revolving credit agreements. As of June 30,
1994 there was $100.0 million available under the senior
bank revolving credit facility.
<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
A. Effective as of May 3, 1994, Written Consents of the
Stock-holders of Hyster-Yale Materials Handling,
Inc. were signed. Said Consents constituted the Annual
Meeting of Stockholders for 1994.
B. The Written Consents of Stockholders of Hyster-Yale
Materials Handling, Inc. reduced the number of Directors
of the Company to 14 and elected the following
individuals as Directors of the Company until the next
Annual Meeting or until their successors are elected.
Owsley Brown II
John J. Dwyer
Reginald R. Eklund
Robert M. Gates
E. Bradley Jones
Dennis W. LaBarre
Yoshinori Ohno
Alfred M. Rankin, Jr.
Claiborne R. Rankin
John C. Sawhill
Britton T. Taplin
David F. Taplin
Frank E. Taplin, Jr.
Richard B. Tullis
C. The matters mentioned in Item B. above were the only
matters consented to and the Consents were executed by
stockholders representing all of the outstanding shares
of the Company.
Item 5 - Other Information
None
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits. See Exhibit Index on page 15 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.
Hyster-Yale Materials Handling, Inc.
------------------------------------
(Registrant)
/S/ Roger A. Jensen
--------------------------------
Roger A. Jensen
Controller
(Chief Accounting Officer)
Date: August 12, 1994
------------------------
<PAGE>
EXHIBIT INDEX
Exhibit 10
* (lxxxxiv) Amendment No. 2 to the Hyster-Yale Materials
Handling, Inc. Annual Incentive Compensation
Plan effective January 1, 1994 is attached
hereto as Exhibit 10(lxxxxiv).
* (lxxxxv) Amendment No. 3 to the Hyster-Yale Materials
Handling, Inc. Long-Term Incentive Compensation
Plan effective January 1, 1994 is attached
hereto as Exhibit 10(lxxxxv).
* (lxxxxvi) Amendment No. 3 to the NACCO Materials Handling
Group, Inc. Profit Sharing Plan effective
January 1, 1994 is attached hereto as Exhibit
10(lxxxxvi).
* (lxxxxvii)Amendment No. 2 to the NACCO Materials Handling
Group, Inc. Unfunded Benefit Plan effective
January 1, 1994 is attached hereto as Exhibit
10(lxxxxvii).
*(lxxxxviii)Amendment No. 2 dated as of June 29, 1994
to Amended and Restated Credit Agreement dated
as of July 30, 1993 is attached hereto as
Exhibit 10(lxxxxviii).
* Management Contract or Compensation Plan or arrangement
required to be filed as an exhibit pursuant to Item 6(a) of
this Quarterly Report on Form 10-Q.
<PAGE>
Exhibit 10(lxxxxiv)
AMENDMENT NO. 2
TO THE
HYSTER-YALE MATERIALS HANDLING, INC.
ANNUAL INCENTIVE COMPENSATION PLAN
NACCO Materials Handling Group, Inc. (as successor to
Hyster Company) hereby adopts this Amendment No. 2 to the Hyster-
Yale Materials Handling, Inc. Annual Incentive Compensation Plan
(the "Plan"), effective as of January 1, 1994.
Section 1
Section 1 of the Plan is hereby amended in its entirety
to read as follows:
"General. NACCO Materials Handling Group, Inc. (the
`Company') has established an Annual Incentive Compensation Plan
(the `Plan') as part of a competitive compensation program for
the officers and key management employees of the Company."
Section 2
The name of the Plan is hereby changed to the "NACCO
Materials Handling Group, Inc. Annual Incentive Compensation
Plan."
Executed this 14th day of July , 1994.
NACCO MATERIALS
HANDLING GROUP, INC.
By: /s/ B. I. Bull
Title: Vice President,
General Counsel and
Secretary
<PAGE>
Exhibit 10(lxxxxv)
AMENDMENT NO. 3
TO THE
HYSTER-YALE MATERIALS HANDLING, INC.
LONG-TERM INCENTIVE COMPENSATION PLAN
NACCO Materials Handling Group, Inc. (as successor to
Hyster Company) hereby adopts this Amendment No. 3 to the Hyster-
Yale Materials Handling, Inc. Long-Term Incentive Compensation
Plan (the "Plan") effective as of January 1, 1994.
Section 1
Section 1 of the Plan is hereby amended by deleting the
phrase "Hyster Company (and its successors in interest)" and
replacing it with the phrase "NACCO Materials Handling Group,
Inc."
Section 2
The name of the Plan is hereby changed to the "NACCO
Materials Handling Group, Inc. Long-Term Incentive Compensation
Plan."
Executed this 14th day of July , 1994.
NACCO MATERIALS
HANDLING GROUP, INC.
By: /s/ B. I. Bull
Title: Vice Presidnet,
General Counsel and
Secretary
<PAGE>
Exhibit 10(lxxxxvi)
AMENDMENT NO. 3
TO THE
NACCO MATERIALS HANDLING GROUP, INC. PROFIT SHARING PLAN
NACCO Materials Handling Group, Inc. hereby adopts this
Amendment No. 3 to the NACCO Materials Handling Group, Inc.
Profit Sharing Plan (as amended and restated effective November
1, 1992) (the "Plan"), effective as of January 1, 1994. Words
and phrases used herein with initial capital letters which are
defined in the Plan are used herein as so defined.
Section 1
Section 3.11(1) of the Plan is hereby amended by adding
the paranthetical phrase "(other than NACCO Industries, Inc.)"
after the phrase "each Employer" in the second line thereof.
Section 2
Section 3.11 of the Plan is hereby amended by (i)
renumbering Subsections (2) and (3) thereof as Subsections (3)
and (4) thereof, and (ii) adding a new Subsection (2) thereto to
read as follows:
"(2) For each Plan Year commencing on or after January
1, 1994, NACCO Industries, Inc. shall make a Profit Sharing
Contribution to the Trust on behalf of each eligible Profit
Sharing Employee who is its Employee in an amount equal to the
sum of (a) and (b), where (a) is the eligible Profit Sharing
Employee's Compensation for such Plan Year multiplied by a
percentage factor and (b) is the eligible Profit Sharing
Employee's Compensation for such Plan Year which exceeds the
Social Security Wage Base for such Plan Year multiplied by a
percentage factor, both of which are determined in accordance
with the following schedule:
Percent of Compen-
Percent of sation Exceeding
Age Compensation Social Security Wage Base
0-34 2.75% 2.75%
35-39 3.10% 3.10%
40-44 3.55% 3.55%
45-49 4.25% 4.25%
50-54 5.05% 5.05%
55-59 6.05% 5.70%
60+ 7.00% 5.70%"
<PAGE>
Executed this 14th day of July , 1994.
NACCO MATERIALS HANDLING GROUP, INC.
By: /s/ B. I. Bull
Title: Vice President,
General Counsel and
Secretary
NACCO INDUSTRIES, INC.
By: /s/ Charles A. Bittenbender
Title: Vice President
<PAGE>
Exhibit 10(lxxxxvii)
AMENDMENT NO. 2
TO THE
NACCO MATERIALS HANDLING GROUP, INC. UNFUNDED BENEFIT PLAN
NACCO Materials Handling Group, Inc. hereby adopts this
Amendment No. 2 to the NACCO Materials Handling Group, Inc.
Unfunded Benefit Plan (the "Plan") effective as of January 1,
1994. 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 2.1A is hereby added to the Plan,
immediately following Section 2.1, to read as follows:
"SECTION 2.1A. Adjusted ROE shall mean the average
return on equity of NACCO Industries, Inc. (for Profit Sharing
Employees who are Employees of NACCO Industries, Inc.) or of the
Company (for Profit Sharing Employees who are Employees of the
Company) calculated for the applicable time period, based on the
following formula:
Net Income (before extraordinary charges) + Amortization of Goodwill
Weighted Average (Shareholder Equity + Accumulated Amortization of Goodwill)
Adjusted ROE shall be determined at least annually by the Employers."
Section 2
Section 3.2(b) of the Plan is hereby amended in its
entirety to read as follows:
"(b) Earnings.
(i) For Active Employees. At the end of each calendar
month during a calendar year, the Account of each Participant who
is employed by an Employer on December 31 of such year shall be
credited with the amount determined by multiplying such
Participant's average Account balance during such month by the
blended rate earned during such month by the Stable Asset Fund
under the NACCO Materials Handling Group, Inc. Profit Sharing
Plan. Notwithstanding the foregoing, in the event that the
Adjusted ROE determined for such calendar year that is applicable
to the Participant exceeds the rate credited to the Participant's
Account under the preceding sentence, the Participant's Account
shall retroactively be credited with the difference between (A)
the amount determined under the preceding sentence, and (B) the
amount determined by multiplying the Participant's average
Account balance during each month of such calendar year by the
Average ROE determined for such calendar year, compounded
monthly.
<PAGE>
(ii) For Terminated Employees. The Account of a
Participant who has terminated employment with the Controlled
Group shall be credited with earnings as described in paragraph
(i), as modified by this paragraph (ii), until his Account has
been distributed in full in accordance with Article V. The
Adjusted ROE calculation described in the second sentence of
paragraph (i) 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 Employer.
For any subsequent month, the Adjusted ROE calculation described
in the second sentence of paragraph (i) shall not apply. The
Stable Asset Fund calculation described in the first sentence of
paragraph (i) for the month in which the Participant receives a
distribution from his Account shall be based on the blended rate
earned during the preceding month by the Stable Asset Fund."
Section 3
Section 5.1(a) of the Plan is hereby amended by adding the
following sentence to the end thereof:
"Notwithstanding the foregoing, in the event that the
balance of a Participant's Account does not exceed $5,000 at
the time of his termination of employment with the
Controlled Group, his entire Account shall automatically be
paid to him as soon as practicable following such
termination of employment."
EXECUTED this 14th day of July , 1994.
NACCO MATERIALS HANDLING GROUP, INC.
By /s/ B. I. Bull
Title: Vice President,
General Counsel and
Secretary
<PAGE>
Exhibit 10(lxxxxviii)
AMENDMENT NO. 2
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
dated as of July 30, 1993
THIS AMENDMENT NO. 2 ("Amendment") is made as of June
29, 1994, among Hyster-Yale Materials Handling, Inc., a Delaware
corporation ("Holdings"), NACCO Materials Handling Group, Inc., a
Delaware corporation and successor in interest by merger to Yale
Materials Handling Corporation, a Delaware corporation and Hyster
Company, an Oregon corporation ("NMHGI") (Holdings and NMHGI are
referred to from time to time hereinafter individually as a
"Borrower" and collectively as the "Borrowers"), the institutions
from time to time party hereto as lenders (collectively, the
"Lenders" and individually, a "Lender"), and Citicorp North
America, Inc., a Delaware corporation ("Citicorp"), individually
and as agent (in such capacity, the "Agent") for the Lenders.
Capitalized terms used and not otherwise defined herein shall
have the meanings set forth in the Credit Agreement (as defined
below).
PRELIMINARY STATEMENT:
WHEREAS, the Borrowers, the Lenders, the Issuing Banks,
and the Agent have entered into that certain Amended and Restated
Credit Agreement dated as of July 30, 1993 (as the same has been
or hereafter may be amended, modified or supplemented from time
to time, the "Credit Agreement"), pursuant to which the Agent and
the Lenders have agreed to provide to the Borrowers certain loans
and other financial accommodations, subject to the terms and
conditions contained therein;
WHEREAS, the Borrowers have informed the Agent and the
Lenders that NMHGI is desirous of repurchasing or redeeming
certain of the Debentures in an aggregate amount (including any
premium associated therewith) of $75,000,000 and that it proposes
accomplishing the same by using (i) $50,000,000 in the aggregate
of cash from operations and proceeds of Revolving Loans and (ii)
proceeds in the amount of $25,000,000 to be contributed to the
capital of NMHGI by NACCO;
WHEREAS, The Borrowers have requested certain other
modifications of the Credit Agreement, including, without
limitation, certain provisions relating to sales of assets and
financial reporting;
WHEREAS, in view of the foregoing, the Borrowers, the
Agent and the Lenders have agreed to amend the Credit Agreement,
subject to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing
premises, the terms and conditions stated herein and other
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the Borrowers, the Agent and the Lenders,
such parties hereby agree as follows:
<PAGE>
1. Amendment. Effective as of June 29, 1994 upon
satisfaction of the conditions precedent set forth in Section 2
below, the Credit Agreement is hereby amended as follows:
1.1 Section 1.1 is amended to add the following
defined term therein, in appropriate alphabetical order:
"NMHGI" shall mean NACCO Materials Handling Group,
Inc., a Delaware corporation and successor in interest
by merger to Yale Materials Handling Corporation, a
Delaware corporation, and Hyster Company, an Oregon
corporation.
1.2 Section 6.2(a) is amended to delete the provisions
thereof in their entirety and substitute the following therefor:
(a) Monthly Financial Statements. As soon as
practicable, and in any event, (i) with respect to
statements pertaining to December of any Fiscal Year,
within ninety (90) days after the end of such Fiscal
Year, (ii) with respect to statements pertaining to
January of any Fiscal Year, within sixty (60) days
after the end of January, and (iii) with respect to
statements pertaining to each other fiscal month in
each Fiscal Year, forty-five (45) days after the end of
such fiscal month, the consolidated and consolidating
balance sheet of Holdings as at the end of such month,
and related consolidated and consolidating statements
of income and cash flow of Holdings for such month and
for the period from the beginning of the current Fiscal
Year of Holdings to the end of such month, in each case
substantially in the form attached hereto as Exhibit
6.2(a), and setting forth in comparative form the
consolidated and consolidating figures for the
corresponding periods of the previous Fiscal Year of
Holdings, in substantially the form and with
substantially the same detail as currently prepared by
Holdings, or in such form and with such detail
otherwise satisfactory to the Agent, subject to changes
resulting from audit and normal year-end adjustments.
1.3 Section 8.2(c) is amended to delete clause (v)
thereof in its entirety and substitute the following therefor:
"(v) on or after August 1, 1994, cash payments by
Holdings made to repurchase or otherwise retire the
Debentures from proceeds other than as set forth in
Section 8.2(c)(vi) below; provided that (A) such
aggregate cash payments (1) up to $25,000,000 may
be made at any time, (2) in excess of $25,000,000 but
not to exceed $50,000,000 may be made only if NACCO
shall have contributed a minimum of $25,000,000 in cash
equity to Holdings concurrently with such repurchase or
retirement of Debentures and all of such cash
contribution is used to effect such repurchase or
retirement of Debentures, and (3) in excess of
$50,000,000 but not to exceed $75,000,000 may be made
at any time the Stepdown Leverage Ratio is less than or
equal to forty-three percent (43%), (B) no Event of
<PAGE>
Default or Potential Event of Default has occurred and
is continuing or would result therefrom, (C) as of the
date of such cash payment, to the best knowledge of
Holdings, the Stepdown Leverage Ratio supplied to the
Agent for the previous fiscal quarter shall not have
deteriorated, and (D) the Agent shall have received a
certificate from Holdings' chief financial officer or
treasurer setting forth the calculation of the Stepdown
Leverage Ratio for the most recently-ended fiscal
quarter or month and, in the case of clause (3) above,
such calculation shall utilize the financial
information set forth in the financial statements then
most recently delivered to the Lenders and the Agent
pursuant to Section 6.2(a) or Section 6.2(b) and"
and to add the following sentence at the end of Section 8.2(c):
Notwithstanding anything in this Agreement to the
contrary, for purposes of clause (v)(D) above, the
calculation of the "Stepdown Leverage Ratio" shall be
made using the Subordinated Indebtedness outstanding as
of the last day of the applicable fiscal quarter or
month, rather than the average daily Subordinated
Indebtedness outstanding during the applicable fiscal
quarter or month.
1.4 Section 8.2(f)(ii) is amended to delete the
provisions thereof in their entirety and substitute the following
therefor:
(ii) the sale by any Borrower or any Subsidiary
of a Borrower in the ordinary course of business of
Receivables (A) for which the account debtor is located
outside of the United States and which does not
constitute part of the Collateral or (B) for which the
account debtor is located within the United States and
which does constitute part of the Collateral; provided
that the aggregate face amount of Receivables described
in clause (B) does not exceed $35,000,000 during any
Fiscal Year;
1.5 Section 7.1(w) is amended to delete the provisions
thereof in their entirety and substitute the following therefor:
(w) The authorized capital stock of Holdings
consists of 10,000 shares of common stock with a par
value of $1.00. The issued and outstanding shares of
capital stock of Holdings consist of 5,598.857 shares
of common stock, 5,435.826 of which are owned
beneficially and of record by NACCO free and clear of
all Liens, except as otherwise contemplated pursuant to
the Loan Documents, 29.642 of which are owned
beneficially and of record by Jungheinrich
Unternehmensverwaltung ("JU"), and 133.389 of which are
owned beneficially and of record by Sumitomo Heavy
Industries LTD. ("SHI"). The number of issued and
outstanding shares of capital stock of Holdings may
increase and the ownership interests of NACCO, JU and
SHI may be adjusted accordingly in connection with the
<PAGE>
cash equity contribution by NACCO of $25,000,000
referenced in Section 8.2(c) if and when made and in
connection with other cash equity contributions by
NACCO. The authorized capital stock of NMHGI consists
of twenty (20) shares of common stock with no par
value, all of which twenty (20) shares are fully paid,
non-assessable, issued and outstanding and held
beneficially and of record by Holdings, free and clear
of all Liens, except as otherwise contemplated pursuant
to the Loan Documents.
1.6 Section 12.22 is amended to delete the second
sentence thereof in its entirety and substitute the following
therefor:
NMHGI hereby covenants and agrees to maintain
Collection Account Agreements in form and substance
satisfactory to the Agent for each Collection Account
and, pursuant to such Collection Account Agreements, to
direct each financial institution at which a Collection
Account is maintained to remit on each Business Day all
amounts on deposit in such Collection Account on such
Business Day in excess of $1,000 to a Concentration
Account.
1.7 NMHGI is the successor in interest by merger to
Yale and Hyster. All references in the Agreement to Yale or
Hyster shall be deemed to be references to NMHGI.
2. Effectiveness of this Amendment; Conditions
Precedent. This Amendment shall become effective as of June 29,
1994 provided that the Agent shall have received, on or before
June 29, 1994, twenty (20) copies of this Amendment executed by
Holdings, the Borrowers, and Lenders constituting at least the
Majority Lenders.
3. Representation and Warranty. Each of the Borrowers
represents and warrants that (a) the Credit Agreement, as amended
by this Amendment, constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms,
(b) no Event of Default or Potential Event of Default has
occurred and is continuing, (c) the execution, delivery and
performance by the Borrowers of this Agmendment have been duly
authorized by all necessary corporate and other action and do not
and will not require any registration with, consent or approval
of, notice to or action by, any Person (including any
Governmental Authority) in order to be effective and enforceable,
(d) all representations and warranties of the Borrowers contained
in the Credit Agreement are true and correct, and (e) the
Borrowers are entering into this Amendment on the basis of their
own investigation and for their own reasons, without reliance
upon the Agent, the Lenders, the Issuing Bank or any other
Person.
<PAGE>
4. Reference to and Effect Upon the Loan Documents.
The Loan Documents shall remain in full force and effect and are
hereby ratified and confirmed. Upon the effectiveness of this
Amendment, each reference in the Credit Agreement to "this
Agreement", "hereunder", "hereof", "herein", or words of like
import shall mean and be a reference to the Credit Agreement as
amended hereby and each reference to the Credit Agreement in any
other document, instrument or agreement executed and/or delivered
in connection with the Credit Agreement shall mean and be a
reference to the Credit Agreement as amended hereby.
5. Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of New
York.
6. Counterparts. This Amendment may be executed in
any number of counterparts, each of which shall be an original
and each of which together shall constitute one and the same
agreement among the parties. Delivery of an executed facsimile
copy of any signature page to this Amendment shall be deemed
effective as delivery of an executed original.
<PAGE>
IN WITNESS WHEREOF, this Agreement has been duly
executed as of this 29th day of June, 1994.
HOLDINGS: HYSTER-YALE MATERIALS HANDLING,
INC.
By: ______________________________
Name:
Title:
Address: P.O. Box 2902
2701 N.W. Vaughn Street
Portland, Oregon 97208
Attn: Vice President
and Chief Financial Officer
Telephone No.: 503-721-6001
Telecopy No.: 503-721-6171
NMHGI: NACCO MATERIALS
HANDLING GROUP, INC., a Delaware
corporation
By: ______________________________
Name:
Title:
Address: P.O. Box 2902
2701 N.W. Vaughn Street
Portland, Oregon 97208
Attn: Vice President
and Chief Financial Officer
Telephone No.: 503-721-6001
Telecopy No.: 503-721-6171
AGENT: CITICORP NORTH AMERICA, INC.,
as Agent
By:
Jeffrey D. Klein
Vice President
<PAGE>
LENDERS: CITICORP NORTH AMERICA, INC.
By________________________________
Jeffrey D. Klein
Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By
Name:
Title:
THE BANK OF CALIFORNIA, N.A.
By
Name:
Title:
THE BANK OF NOVA SCOTIA
By
Name:
Title:
BANK OF SCOTLAND
By
Name:
Title:
CAISSE NATIONALE DE CREDIT AGRICOLE
By
Name:
Title:
<PAGE>
CONTINENTAL BANK N.A.
By
Name:
Title:
FIRST INTERSTATE BANK OF OREGON
By
Name:
Title:
GIROCREDIT BANK
By
Name:
Title:
ISTITUTO BANCARIO SAN PAOLO DI
TORINO
By
Name:
Title:
LONG-TERM CREDIT BANK OF JAPAN,
LTD.
By
Name:
Title:
MELLON BANK N.A.
By
Name:
Title:
<PAGE>
NATIONAL CITY BANK
By
Name:
Title:
ROYAL BANK OF CANADA
By
Name:
Title:
STAR BANK, N.A., CINCINNATI
By
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO
By
Name:
Title:
U.S. NATIONAL BANK OF OREGON
By
Name:
Title:
BANK
OF
TOKYO
By
_______________________________
Name:
Title:
NACCO.AM2 (8/12/94 4:01PM)
<PAGE>
