<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K ANNUAL REPORT
Pursuant to Section 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended Commission File No. 33-28812
December 31, 1994
HYSTER-YALE MATERIALS HANDLING, INC.
------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 34-1617886
------------------------------- ----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2701 N.W. Vaughn, Portland, Oregon 97210
---------------------------------------- ----------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (503) 721-6000
--------------
Securities Registered Pursuant to Section 12(b) of the Act:
----------------------------------------------------------
Name of each exchange
Title of each class on which registered
--------------------------------------------------------------------------------
None None
Securities registered pursuant to Section 12(g) of the Act:
None
----
(Title of class)
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
requirement for the past 90 days.
Yes X No
------ ------
The provisions of Item 405 of Regulation S-K are not applicable to the
registrant. There is no market for any of the registrant's voting stock, and
there have been neither any sales of such stock within 90 days of the filing
date, nor any bid or asked prices for such stock. The book value of
shares held by non-affiliates as of December 31, 1994 was approximately
$8,908,144. Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of March 31, 1995:
Common Stock, par value $1.00 per share - 5,598.857
---------------------------------------------------
Documents incorporated by reference:
None
----
<PAGE> 2
PART I
ITEM 1. BUSINESS
-----------------
The Company's Background
------------------------
Hyster-Yale Materials Handling, Inc. ("Hyster-Yale" or the
"Company") was formed as a Delaware corporation in May 1989 in connection with
the acquisition of Hyster Company ("Hyster") by NACCO Industries, Inc.
("NACCO"). NACCO directly owns approximately 97% of common stock, par value
$1.00 per share ("Common Stock") of the Company, which is the parent company of
NACCO Materials Handling Group, Inc. ("NMHG"). NMHG designs, manufactures and
markets the two full lines of forklifts and related service parts under the
Hyster(R) and Yale(R) brand names.
Significant Events
------------------
DEBT RESTRUCTURING. In August 1994, NACCO and the Company's two
minority shareholders, Sumitomo Heavy Industries Ltd. of Japan ("Sumitomo") and
Jungheinrich Aktiengesellschaft, a German manufacturer of forklift trucks,
("Jungheinrich"), made a pro rata cash contribution of $25 million. This cash
contribution, along with internally generated funds and borrowings, enabled the
Company to call approximately $48 million face value of subordinated debentures
at a price of 105.
In December, 1994, NMHG called an additional approximately $24
million face value of subordinated debentures at a price of 105 using
internally generated funds and borrowings. At December 31, 1994 there remain
outstanding subordinated debentures having a face value of approximately $78.5
million.
On February 28, 1995, NMHG entered into a new long-term credit
agreement to replace its existing bank agreement and to refinance the majority
of its existing long-term debt. The new agreement provided the company with an
unsecured $350 million revolving credit facility to replace its current senior
credit facility. The new credit facility has a five-year maturity with
extension options and performance-based pricing comparable to its current
senior credit facility which provides the company with reduced interest rates
upon achievement of certain financial performance targets. With the new credit
facility in place, the company has the ability to call the remaining $78.5
million outstanding subordinated debentures in 1995. In anticipation of the
call, an extraordinary charge of $3.4 million will be recorded in the first
quarter of 1995 to write-off unamortized debt issuance costs and anticipated
premiums.
The Forklift Truck Industry
---------------------------
Forklift trucks are used in both manufacturing and warehousing
environments. The materials handling industry, especially in industrialized
nations, is generally a mature industry which has historically been cyclical.
Fluctuations in the rate of orders for forklift trucks reflect
the capital investment decisions of the customers, which in turn depend upon
the general level of economic activity in the various industries served by such
customers. In the most recent business cycle the North American market for
forklift trucks reached its lowest level in 1991 and has increased in each
- 1 -
<PAGE> 3
year since then to a record level in 1994. The European and Japanese markets
generally had been in decline since 1990; they both showed recovery in 1994.
During this business cycle, however, the total worldwide lift-truck market was
relatively stable.
Company Operations
------------------
NMHG maintains product differentiation between Hyster(R) and
Yale(R) brands of forklift trucks and distributes its products through separate
worldwide dealer networks. Nevertheless, opportunities have been identified
and addressed to improve the Company's results by integrating overlapping
operations and taking advantage of economies of scale in design, manufacturing
and purchasing. NMHG provides all design, manufacturing and administrative
functions. Products are marketed and sold through two separate groups which
retain the Hyster and Yale identities. In Japan, NMHG has a 50% owned joint
venture with Sumitomo named Sumitomo Yale Company Limited ("S-Y"). S-Y
performs certain design activities and produces lift trucks and components
which it markets in Japan and which are exported for sale by NMHG and its
affiliates in the U.S. and Europe.
Product Lines
-------------
NMHG manufactures a wide range of forklift trucks under both the
Hyster(R) and Yale(R) brand names. The principal categories of forklift trucks
include electric rider, electric narrow-aisle and electric motorized hand
forklift trucks primarily for indoor use, and internal combustion engine
("ICE") forklift trucks for indoor or outdoor use. Forklift truck sales
accounted for approximately 82%, 80%, and 79%, of NMHG's net sales in 1994,
1993, and 1992 respectively.
NMHG also derives significant revenues from the sale of service
parts for its products. Profit margins on service parts are greater than those
on forklift trucks. The large population of Hyster(R) and Yale(R) forklift
trucks now in service provides a market for service parts. In addition to
parts for its own forklift trucks, NMHG has a program (termed UNISOURCETM in
North America and MULTIQUIPTM in Europe) designed to supply Hyster dealers with
replacement parts for most competing brands of forklift trucks. NMHG has a
similar program (termed PREMIERTM) for its Yale dealers in the Americas and
Europe. Accordingly, NMHG dealers can offer their mixed fleet customers a "one
stop" supply source. Certain of these parts are manufactured by and purchased
from third party component makers, NMHG also manufactures some of these parts
through reverse-engineering of its competitors' parts. Service parts accounted
for approximately 18%, 20%, and 21% of NMHG's net sales in 1994, 1993, and
1992, respectively.
Competition
-----------
The forklift truck industry is highly competitive. The worldwide
competitive structure of the industry is fragmented by product line and
country. The principal methods of competition among forklift truck
manufacturers are product performance, price, service and distribution
networks. The forklift truck industry competes with alternative methods of
materials handling, including conveyor systems, automated guided vehicle
systems and hand labor. Global competition is also affected by a number of
other factors, including currency fluctuations, variations in labor costs and
effective tax rates, and the costs related to compliance with applicable
regulations, including export restraints, antidumping provisions and
- 2 -
<PAGE> 4
environmental regulations.
Although there is no official source for information on the
subject, the Company believes it is one of the top three manufacturers of
forklift trucks in the world.
NMHG's position is strongest in North America, where it believes
it is the leader in unit sales of electric rider and ICE forklift trucks and
has a significant share of unit sales of electric narrow-aisle and electric
motorized hand forklift trucks. Although the European market is fragmented and
competitive positions vary from country to country, NMHG believes that it has a
significant share of unit sales of electric rider and ICE forklift trucks in
Western Europe. Although NMHG's current market share in Asia-Pacific,
including Japan, is lower than in other geographical areas, it has been
targeted for additional market share growth.
Trade Restrictions
------------------
A. United States
-------------
Since June 1988, Japanese-built ICE forklift trucks, imported
into the U.S., with lifting capacities between 2,000 and 15,000 pounds,
including finished and unfinished forklift trucks, chassis, frames, and frames
assembled with one or more component parts, have been subject to an antidumping
duty order. Antidumping duty rates in effect through 1994 range from 4.48% to
56.81% depending on manufacturer or importer. The antidumping duty rate
applicable to imports from S-Y is 51.33%, and is likely to continue unchanged
for the foreseeable future, unless S-Y and NMHG decide to participate in
proceedings to have it reduced. NMHG does not currently import for sale in the
United States any forklift trucks or components subject to the antidumping duty
order. This antidumping duty order will remain in effect until the Japanese
manufacturers and importers satisfy the U.S. Department of Commerce
("Commerce") that they have not individually sold merchandise subject to the
order in the United States below foreign market value for at least three
consecutive years, or unless Commerce or the U.S. International Trade
Commission finds that changed circumstances exist sufficient to warrant the
order's revocation. The legislation implementing the Uruguay Round of GATT
negotiations passed in 1994 provides that the antidumping order will be
reviewed for possible revocation in the year 2000. All of NMHG's major
Japanese competitors have either built or acquired manufacturing or assembly
facilities in the United States. The Company cannot predict with any certainty
if there will be any negative effects to the Company resulting from the
Japanese sourcing of their forklift products in the United States.
B. Europe
------
From 1986 through 1994, Japanese forklift truck manufacturers
were subject to informal export restraints on Japanese-manufactured electric
rider, electric narrow-aisle, and ICE forklift trucks shipped to Europe. These
informal restraints are not expected to continue in 1995. Several Japanese
manufacturers have established manufacturing or assembly facilities within the
European community. The Company also cannot predict with any certainty if
there will be any negative effects to NMHG resulting from the Japanese sourcing
of their forklift products in Europe.
- 3 -
<PAGE> 5
Product Design and Development
------------------------------
NMHG spent $23.2 million, $20.7 million, and $21.9 million on
product design and development activities in 1994, 1993, and 1992,
respectively. The Hyster(R) and Yale(R) products are differentiated for the
specific needs of their respective customer bases. NMHG continues to pursue
opportunities to improve product cost by engineering new Hyster(R) and Yale(R)
brand products with component commonality.
Certain product design and development activities with respect to
ICE forklift trucks and some components are performed in Japan by S-Y. S-Y
spent approximately $4.5 million, $4.0 million, and $3.7 million on product
design and development in 1994, 1993, and 1992, respectively.
Backlog
-------
As of December 31, 1994, NMHG's backlog of unfilled orders for
forklift trucks was approximately 24,600 units, or $433 million. This compares
to the backlog as of December 31, 1993 of approximately 12,100 units, or $206
million. Management believes NMHG's backlog level is consistent with overall
increases in industry backlog levels. Backlog represents unit orders to NMHG's
manufacturing plants from independent dealerships, retail customers and
contracts with the U.S. Government. Although these orders are believed to be
firm, such orders may be subject to cancellation or modification.
Sources
-------
NMHG has adopted a strategy of obtaining its raw materials and
principal components on a global basis from competitively priced sources. NMHG
is dependent on a limited number of suppliers for certain of its critical
components, including diesel and gasoline engines and cast-iron counterweights
used on certain forklift trucks. There would be a material adverse effect on
NMHG if it were unable to obtain all or a significant part of such components,
or if the cost of such components were to increase significantly under
circumstances which prevented NMHG from passing on such increases to its
customers.
Distribution
------------
The Hyster(R) and Yale(R) brand products are distributed through
separate highly developed worldwide dealer networks. Each also sells directly
to certain major accounts.
In Japan, forklift truck products are distributed by S-Y. In
1991, Yale reached a ten-year agreement with Jungheinrich to continue
distribution of Yale brand products in Germany and Austria and to provide to
Jungheinrich certain ICE and electric-powered products for sale in other major
European countries under the Jungheinrich brand name.
- 4 -
<PAGE> 6
Financing of Sales
------------------
Hyster U.S. dealer and direct sales are supported by leasing and
financing services provided by Hyster Credit Company, a division of AT&T
Commercial Finance Corporation, pursuant to an operating agreement which
expires in 2000.
NMHG is a minority stockholder of Yale Financial Services, Inc.,
a subsidiary of General Electric Capital Corporation, which offers Yale U.S.
dealers wholesale and retail financing and leasing services. Such retail
financing and leasing services are also available to Yale national account
customers.
Employees
---------
As of February 28, 1995, NMHG had approximately 6,000 employees.
Employees in the Danville, Illinois manufacturing and parts depot operations
are unionized, as are tool room employees located in Portland, Oregon. A
three-year contract for the Danville union employees was signed in 1994 which
will expire in June 1997. A new three-year contract was signed in 1994 with
the Portland tool room union which will expire in October 1997. Employees at
the facilities in Berea, Kentucky; Sulligent, Alabama; and Greenville and
Lenoir, North Carolina are not represented by unions.
In Europe, shop employees in the Craigavon, Northern Ireland
facility are unionized. Employees in the Irvine, Scotland and Nijmegen, The
Netherlands facilities are not represented by unions. The employees in
Nijmegen have organized a works council, as required by Dutch law, which
performs a consultative role on employment matters.
NMHG's management believes its current labor relations with both
union and non-union employees are generally satisfactory.
Government Regulation
---------------------
NMHG's manufacturing facilities, in common with others in
industry, are subject to numerous laws and regulations designed to protect the
environment, particularly with respect to disposal of plant waste. NMHG's
products are also subject to various industry and governmental standards.
NMHG's management believes that such requirements have not had a material
adverse effect on its operations.
Patents, Trademarks and Licenses
--------------------------------
NMHG is not materially dependent upon patents or patent
protection. The Hyster(R) trademark is currently registered in approximately
51 countries. The Yale(R) trademark, which is used on a perpetual royalty-free
basis in connection with the manufacture and sale of forklift trucks and
related components, is currently registered in approximately 100 countries.
NMHG's management believes that its business is not dependent upon any
individual trademark registration or license, but that the Hyster(R) and
Yale(R) trademarks are material to its business.
- 5 -
<PAGE> 7
<TABLE>
ITEM 2. PROPERTIES
-------------------
The following table summarizes certain information with respect
to the principal manufacturing, distribution and office facilities owned or
leased by NMHG and its subsidiaries.
<CAPTION>
Location Owned Leased Function/Principal Products
-------- ----- ------ ---------------------------
<S> <C> <C> <C>
Basingstoke, England X Hyster forklift truck marketing and
sales operations for Europe, the
Middle-East and Africa
Berea, Kentucky X Manufacture of forklift trucks
Craigavon, Northern X Manufacture of forklift trucks
Ireland
Danville, Illinois X Manufacture of forklift trucks,
components and service parts
Danville, Illinois X Distribution of service parts
for both Hyster and Yale forklift
trucks
Danville, Illinois X Hyster forklift truck marketing
and sales operations for North America
Flemington, X Yale forklift marketing and sales
New Jersey operations for the Americas and certain
NMHG engineering operations
Greenville, X Manufacture of forklift trucks; NMHG
North Carolina manufacturing and other staff operations
for the Americas
Irvine, Scotland X Manufacture of forklift trucks and other
staff operations for Euorpe
Lenoir, X Manufacture of component parts for
North Carolina forklift trucks
Nijmegen, X Manufacture of forklift trucks and
The Netherlands component parts; distribution of service
parts for forklift trucks
Portland, Oregon X Technical center for testing of prototype
equipment and component parts
Portland, Oregon X NMHG corporate headquarters
Portland, Oregon X Manufacture of production tooling and
production of prototype units and service parts
</TABLE>
- 6 -
<PAGE> 8
<TABLE>
<CAPTION>
Location Owned Leased Function/Principal Products
-------- ----- ------ ---------------------------
<S> <C> <C> <C>
Sao Paulo, Brazil X Manufacture of forklift trucks;
distribution of service parts for forklift
trucks
Sulligent, Alabama X Manufacture of component parts for forklift trucks
Sydney, Australia X Assembly of forklift trucks; distribution of
service parts for forklift trucks and staff
operations for Asia-Pacific
Wolverhampton, England X Yale forklift marketing and sales operations for Europe
</TABLE>
In 1994, NMHG sold one of its facilities located in Danville,
Illinois and is currently leasing back a portion of this facility for its
Hyster Americas Marketing and Sales operations.
ITEM 3. LEGAL PROCEEDINGS
--------------------------
The Company is not a party to any material pending legal
proceeding except ordinary routine litigation incidental to its business.
Certain of such routine litigation includes claims for punitive damages;
however, the management of the Company believes that none of such litigation,
individually or in the aggregate, will have a material adverse effect on the
Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------
No matter was submitted during the fourth quarter of the fiscal
year covered by this report to a vote of security holders of the Company.
- 7 -
<PAGE> 9
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
------------------------------------------------------------------------------
There is no established public trading market for the Company's
Common Stock. On February 28, 1995 there were three holders of record of the
Company's Common Stock.
The Company has not paid any dividends on shares of its Common
Stock since its organization in 1989, and had not been able to declare or pay
dividends with respect to the Common Stock under the terms of its prior debt
agreements. The revised Credit Agreement entered into on February 28, 1995
will allow the transfer of up to $25.0 million to NACCO. The information set
forth in Note I to the Consolidated Financial Statements in Part IV, pages F-14
through F-16 of this Form 10-K is incorporated herein by reference.
- 8 -
<PAGE> 10
<TABLE>
ITEM 6. SELECTED FINANCIAL DATA
--------------------------------
HYSTER-YALE MATERIALS HANDLING, INC.
SELECTED FINANCIAL DATA
(IN THOUSANDS EXCEPT FOR PERCENTAGE AND BACKLOG DATA)
<CAPTION>
Years Ended December 31
------------------------------------------------------------------------------
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
OPERATING RESULTS
Net sales $1,178,882 $908,176 $865,889 $790,618 $922,974
Gross profit 231,507 184,062 191,991 178,667 240,794
Gross profit margin 19.6% 20.3% 22.2% 22.6% 26.1%
Operating profit 65,817 39,561 44,296 41,531 80,829
Net income (loss) 15,520 (8,412) 1,311 1,072 22,532
FINANCIAL CONDITION
Total assets $906,249 $833,035 $846,410 $895,536 $1,024,685
Long-term obligations,
net 211,417 290,343 392,489 379,160 440,947
Stockholders' equity 305,926 257,126 215,391 234,264 251,453
OTHER DATA
Capital expenditures,
exclusive of rental
equipment $25,939 $20,208 $24,252 $17,207 $15,893
Depreciation and
amortization 32,226 31,721 32,177 32,463 31,142
Unit backlog (units)
(Unaudited) 24,600 12,100 12,100 10,077 9,592
</TABLE>
- 9 -
<PAGE> 11
<TABLE>
ITEM 7
------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
---------------------------------------------------------------------------
CONDITION
---------
By geographic regions, revenues and operating profits are as follows:
(In Millions)
<CAPTION>
NET SALES 1994 1993 1992
--------- ---- ---- ----
<S> <C> <C> <C>
Americas $828.1 $645.4 $579.0
Europe, Africa and
Middle East 289.7 220.5 251.5
Asia-Pacific 61.1 42.3 35.4
---- ---- ----
TOTAL $1,178.9 $908.2 $865.9
======== ====== ======
OPERATING PROFIT
----------------
Americas $45.5 $40.3 $14.9
Europe, Africa and
Middle East 15.1 (2.4) 28.7
Asia-Pacific 5.2 1.7 0.7
--- --- ---
TOTAL $65.8 $39.6 $44.3
===== ===== =====
OPERATING PROFIT EXCLUDING GOODWILL AMORTIZATION
------------------------------------------------
Americas $53.4 $48.2 $22.8
Europe, Africa and
Middle East 17.9 0.4 31.5
Asia-Pacific 5.3 1.8 0.8
--- --- ---
TOTAL $76.6 $50.4 $55.1
===== ===== =====
</TABLE>
- 10 -
<PAGE> 12
<TABLE>
1994 COMPARED TO 1993
---------------------
The following schedule details the key components of changes in sales,
operating profit and net income for 1994 compared with 1993.
<CAPTION>
Net
Operating Income
Sales Profit (Loss)
----- ------ ------
(In Millions)
<S> <C> <C> <C>
1993 $908.2 $39.6 $(8.4)
Increase (Decrease) in 1994 from:
---------------------------------
Lift truck unit volume 211.7 40.8 26.5
Sales mix 8.1 (0.8) (0.5)
Average sales price 14.7 14.7 9.6
Service parts 27.2 11.1 7.2
Manufacturing cost 3.5 2.3
Other operating expense (38.9) (25.2)
Foreign currency translation 9.0 (4.2) (2.7)
Other income and expense 7.1
Differences between effective
and statutory tax rates (0.5)
Extraordinary item 0.1
-------- ----- -----
1994 $1,178.9 $65.8 $15.5
======== ===== =====
</TABLE>
Record market size in North America and higher market share in all geographic
regions resulted in record revenues of $1.2 billion in 1994. The Company's
worldwide unit volume increased from approximately 44,000 trucks in 1993 to
approximately 56,000 trucks in 1994 and was the major contributor to the 30%
revenue growth from year to year. Price increases announced in mid-1994 which
took effect later in the year also contributed to higher sales and operating
profit. After market parts sales, attributed primarily to the robust economic
climate in North America, increased 15% from 1993 levels to $210.5 million in
1994. Continued development and upgrading of dealer networks in Europe also
contributed to the sales gains.
Unit volumes increased 26% in 1994 over 1993 and the higher manufacturing
throughput contributed favorably to margins. However, manufacturing
inefficiencies caused by plant ramp-ups and vendor parts shortages, combined
with higher warranty costs, had an unfavorable impact on margins. Also, the
strong Japanese yen continued to put upward pressure on the cost of materials
sourced from Japan. As a result, gross margin declined from 20.3% of sales in
1993 to 19.6% in 1994.
Operating expenses increased $21.2 million in 1994 over 1993 although as a
percent of sales, they declined 1.6 percentage points to 13.1%. In support of
the Company's strategy to gain market share, several marketing initiatives were
launched in 1994, including dealer support programs for Hyster in Germany and
Yale in the Americas. Additional expenses were also incurred to improve
customer service and to support new product development. The investments in
strategic programs are expected to plateau in the next two years.
- 11 -
<PAGE> 13
Interest expense decreased from $40.4 million in 1993 to $33.7 million in 1994
as the Company continued to pay down its total debt with internal cash flow and
a $25 million equity contribution from existing shareholders. The Company's
effective interest rate also decreased as approximately $72 million of its
12-3/8% subordinated debentures were retired during 1994. The Company has
entered into unsecured interest rate swaps for a portion of its floating rate
debt to provide near-term protection against increases in interest rates.
Other income in 1994 consisted primarily of $3.2 million of European employment
grants. In 1994, the Company's 50% equity interest in the earnings of Sumitomo
Yale was $0.5 million income versus a $3.9 million loss in 1993.
Factory backlog at December 31, 1994 was at a record level of approximately
24,600 units compared to 12,100 units at December 31, 1993 and 1992. The
increased order demand in 1994 and, to a lesser degree, vendor parts shortages
have extended delivery lead times and resulted in expanded backlog in 1994.
Management believes that the backlog level is consistent with overall increases
in industry backlog levels.
1993 COMPARED TO 1992
---------------------
The following schedule details the changes in sales, operating profit and net
income (loss) for 1993 compared with 1992:
<TABLE>
<CAPTION>
Net
Operating Income
Sales Profit (Loss)
----- ------ ------
(In Millions)
<S> <C> <C> <C>
1992 $865.9 $44.3 $1.3
Increase (Decrease) in 1993 from:
---------------------------------
Lift truck unit volume 49.8 7.1 4.7
Sales mix 15.1 1.2 0.8
Average sales price 8.2 8.2 5.4
Service parts 6.4 6.6 4.4
Manufacturing costs (10.8) (7.1)
Operating expenses (0.7) (0.5)
Foreign currency translation (37.2) (16.3) (10.8)
Other income and expense (1.0)
Difference between effective and statutory tax rates (1.8)
Change in statutory tax rate (0.5)
Extraordinary item (3.3)
------ ----- ------
1993 $908.2 $39.6 $ (8.4)
====== ===== ======
</TABLE>
- 12 -
<PAGE> 14
1993 results reflected the strengthening North American market offset by
continued weakness in Europe and Japan. Increased demand in North America
resulted in slightly higher prices compared to 1992; however, competitive
pressures continued to restrain margin growth. The improving economy in the
United States stimulated parts sales and, along with tighter cost controls,
resulted in increased operating profit. The success of new products introduced
in 1993 raised the average sales value, however, margins did not increase
proportionately due to mix swings to countries where prices are generally
lower.
Manufacturing costs were higher in 1993 due to new product start-up costs and
under absorbed overhead in Europe. The Pound Sterling weakened against the U.S.
Dollar in 1993 causing sales and operating profit to be translated at lower
amounts. The strong Yen in 1993 contributed to higher costs for products and
parts sourced from Japan.
The debt restructuring and equity infusion in 1993 reduced outstanding debt and
lowered overall effective interest rates resulting in reduced interest
expenses. Other expense of $1.7 million in 1993 was primarily the net of a
$3.9 million loss from the Company's equity interest in Sumitomo Yale and a
$2.1 million gain from the sale of a former plant site. Other income in 1992
included foreign exchange gains which were not repeated as the Company began
hedging a portion of its foreign currency exposures in 1993.
PROVISION FOR INCOME TAXES
--------------------------
The Company's effective tax rate for 1994 was 47.7 percent. For 1993, the
effective tax rate was not meaningful because expenses not deductible for tax
purposes, primarily amortization of goodwill, resulted in a tax provision in
1993 despite a loss before income taxes. The higher level of pretax income in
1994 reduced the effect of these non-deductible expenses and resulted in an
effective tax rate that is closer to the statutory tax rate. Also in 1993, the
Company began providing for U.S. taxes on foreign earnings taxed at overall
lower rates in anticipation of future repatriations.
In 1992 the effective tax rate was 70.7 percent. The high effective tax rate
in 1992 was due to the low level of pretax income in that year relative to the
expenses not deductible for tax purposes.
EXTRAORDINARY CHARGES
---------------------
The extraordinary charges of $3.2 million and $3.3 million, net of $2.0 million
in tax benefits, were recognized in the second quarters of 1994 and 1993,
respectively. These charges represent the write-off of premiums and
unamortized debt issuance costs associated with the retirement of approximately
$70.0 million and $50.0 million face value of 12 3/8% subordinated debentures.
These retirements were achieved using internally generated funds and equity
infusions from existing stockholders.
ENVIRONMENTAL MATTERS
---------------------
The Company's manufacturing operations, like those of other companies engaged
in similar businesses, involve the use, disposal and clean-up of substances
regulated under environmental protection laws. Compliance with these
increasingly stringent standards results in higher expenditures for both
capital improvements and operating costs. The Company's policies emphasize
environmental responsibility and compliance with these regulations. Based on
current information, management does not expect compliance with these
regulations to have a material adverse effect on its financial condition or
results of operations.
- 13 -
<PAGE> 15
1995 OUTLOOK
------------
The forklift truck industry historically has been cyclical. Demand is affected
by the general economic conditions in the various markets in which the
industry's customers operate. Current economic forecasts and recent factory
order trends indicate continued strong economic activity in North America.
Europe has begun to recover from the recent recession and demand is expected to
increase in 1995. In Asia-Pacific, most of the markets in which the Company
participates continue to show growth, and the largest market, Japan, is
expected to show signs of improvement. It is anticipated that worldwide
shipments will be significantly higher in 1995 than in 1994.
The Company plans to continue its aggressive new products introduction schedule
in 1995 and to pursue its strategy of gaining worldwide market share. Focus
will be on strengthening strategic partnerships with key vendors and improving
manufacturing and operational efficiency. The recent earthquake in Japan has
affected the performance of some of the Company's suppliers but the overall
impact is not expected to be material to the Company's operations.
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
Net cash provided by operations was $36.1 million in 1994 compared with $34.1
million in 1993. The increase in cash provided by operations resulted primarily
from reduced net working capital requirements due to cash enhancement programs
and improved profitability.
Expenditures for property, plant and equipment were $25.9 million in 1994
versus $20.2 million in 1993. The majority of these expenditures were for
manufacturing capacity and tooling for new products and the principal source of
financing was internally generated cash flow. Planned capital expenditures in
1995 are approximately $40 million, almost half of which will be for expanded
capacity and for new product development. Approximately $2 million of the $40
million is expected to be financed by economic development capital grants.
Increased cash flow from operations and a $25 million equity infusion from
NACCO enabled the Company to reduce debt during 1994. The Company had $67
million of its $100 million revolving credit facility available at December 31,
1994. In February 1995, the Company entered into a new long term unsecured
credit agreement to replace its existing Credit Agreement and to refinance the
majority of its existing long-term debt.
The new agreement provides the Company with an unsecured $350 million revolving
credit facility to replace its current senior credit facility. The new credit
facility has a five year maturity with an extension option and pricing
comparable to its current senior credit facility. It also provides the Company
with reduced interest rates upon achievement of certain financial performance
targets. With the new credit agreement in place, the Company can redeem the
remaining $78.5 million of the 12 3/8% subordinated debentures and intends to
in 1995. In anticipation of the redemption, the Company intends to record an
extraordinary charge of $3.4 million in the first quarter of 1995, to write-off
unamortized debt issuance costs and anticipated premiums. The Company believes
it can adequately meet all of its current and long-term commitments and
operating needs from operating cash flow and funds available under credit
agreements.
During 1993, the Company repatriated $18.3 million of earnings from certain
foreign subsidiaries. U.S. income taxes were previously provided for financial
reporting purposes. Future distributions of
- 14 -
<PAGE> 16
unremitted earnings may be affected by changes in currency exchange rates and
foreign and U.S. tax rates.
Foreign currency exchange gains (losses) were $(4.7) million, $(0.1) million
and $5.7 million in 1994, 1993, and 1992, respectively. The Company began
hedging a portion of its foreign currency exposure in 1993 to mitigate income
statement exposure. Foreign currency exchange losses in 1994 resulted
primarily from the strong Yen increasing costs of Japanese sourced materials as
minimal hedging of Yen exposures was performed in 1994. Stockholders' equity
was affected by translation of foreign country financial statements where the
functional currency was not the U.S. dollar. The translation gain (loss)
recorded in stockholders' equity was $8.0 million and $(2.2) million in 1994
and 1993, respectively.
EFFECTS OF INFLATION
--------------------
The Company attempts to minimize the impact of inflation on production and
operating costs through productivity improvements and cost reduction programs.
The LIFO method is used to value domestic inventories. Under this method, cost
of goods sold reported in the financial statements approximates current cost.
Therefore, net income for 1994 adjusted for inflation would not be materially
different from net income reported in the consolidated financial statements.
- 15 -
<PAGE> 17
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
----------------------------------------------------
The information required by this Item 8 is set forth at pages F-1 through F-26
of the Financial Statements and Supplementary Data contained in Part IV hereof.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
------------------------------------------------------------------------
FINANCIAL DISCLOSURES
---------------------
None.
- 16 -
<PAGE> 18
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------------------------------
A. Directors of the Company
------------------------
The following table sets forth the names, ages and professional occupations
and directorships of the persons who are currently directors of the Company.
The directors of the Company are elected to serve until the next annual meeting
of the stockholders of the Company.
<TABLE>
<CAPTION>
Director
Name Age Professional Occupation and Directorships Since
---- --- ----------------------------------------- --------
<S> <C> <C> <C>
Owsley Brown II 52 President and Chief Executive Officer of 1994
Brown-Forman Corporation (a diversified
producer and marketer of consumer products).
From prior to 1990 to 1993, President of
Brown-Forman Corporation. Also director of
NACCO, Brown-Forman Corporation, Hilliard
Lyons Trust Company, LG&E Energy Corp., and
Louisville Gas and Electric Company.
John J. Dwyer 77 Retired President of Oglebay Norton Company 1989
(a diversifed company engaged in Great Lakes
marine transportation, iron ore, industrial
sands, refractors, and mineral products).
Also director of NACCO and Oglebay Norton
Company.
Reginald R. Eklund 54 President and Chief Executive Officer of the 1989
Company (since September 1992). President
and Chief Operating Officer of the Company
(prior to 1990 to September 1992). Since
January 1, 1994, President and Chief Executive
Officer of NACCO Materials Handling Group, Inc.
Vice President of Hyster and Yale (from August
1993 through December 1993). President and
Chief Executive Officer of Yale (from prior to
1990 to August 1993) and President and Chief
Executive Officer of Hyster (from September
1992 to August 1993).
Robert M. Gates 51 Consultant, author and lecturer. From 1991 1993
to 1993, Director of Central Intelligence for
the United States. From prior to 1990 to
November 1991, Assistant to the President of
the United States and Deputy for National
Security Affairs, National Security Council.
Also director of NACCO, TRW, Inc., and Varity
Corporation.
</TABLE>
- 17 -
<PAGE> 19
<TABLE>
<CAPTION>
Director
Name Age Professional Occupation and Directorships Since
---- --- ----------------------------------------- --------
<S> <C> <C> <C>
E. Bradley Jones 67 Retired Chairman and Chief Executive Officer 1989
of LTV Steel Company. Also director of NACCO,
Birmingham Steel Corporation, Cleveland-Cliffs
Inc, Consolidated Rail Corporation, RPM, Inc.
and TRW Inc., and trustee of Fidelity Funds
and First Union Real Estate Investments.
Dennis W. LaBarre 52 Partner in the law firm of Jones, Day, 1989
Reavis & Pogue. Also director of NACCO.
Yoshinori Ohno 54 President of S-Y From prior to 1990 to 1993
June 1993, Director of Finance,
Engineering, Product Planning and
Quality Assurance of S-Y.
Alfred M. Rankin, Jr. 53 Chairman, President and Chief Executive 1989
Officer of NACCO. From 1991 to 1994,
President and Chief Executive Officer of
NACCO. From prior to 1990 to 1991,
President and Chief Operating Officer of
NACCO. Also director of NACCO, The BF
Goodrich Company, The Standard Products
Company and The Vanguard Group.
Claiborne R. Rankin 44 Self-employed. From 1992 to 1995, President 1991
and Chief Operating Officer of Bruning Paint
Company (a manufacturer of architectural
coatings). From prior to 1990 to 1992,
Vice President-Corporate Development and
Finance of Laurel Industries, Inc. (a
manufacturer of antimony oxide).
John C. Sawhill 58 President and Chief Executive Officer of 1990
The Nature Conservancy (a non-profit
conservation organization). From prior
to 1990 to 1990, Director of McKinsey &
Company, Inc. (management consulting firm).
Also director of NACCO, Pacific Gas &
Electric Co. and The Vanguard Group.
Britton T. Taplin 38 Partner in Western Skies, Inc. (a developer 1992
of medical office and health care-related
facilities). From prior to 1990 to 1992,
Project Coordinator of Western Skies, Inc.
Also director of NACCO.
David F. Taplin 45 Self-employed. 1989
</TABLE>
- 18 -
<PAGE> 20
<TABLE>
<CAPTION>
Director
Name Age Professional Occupation and Directorships Since
---- --- ----------------------------------------- --------
<S> <C> <C> <C>
Frank E. Taplin, Jr. 79 Trustee of the Environmental Defense Fund. 1989
Former President and Chief Executive Officer
of the Metropolitan Opera, former Vice
Chairman of Lincoln Center for the Performing
Arts, Trustee Emeritus of the Institute for
Advance Study, member of the American
Philosophical Society, former Chairman of
Scurry-Rainbow Oil Ltd. Also director of
NACCO.
Richard B. Tullis 81 Chairman Emeritus of Harris Corporation (a 1989
manufacturer of information processing,
communication and microelectronics products).
Chairman of NCC Funds (investment funds).
Chairman of Waste-Quip, Inc. (a manufacturer
of equipment for handling solid and liquid
waste).
</TABLE>
Alfred M. Rankin, Jr. and Claiborne R. Rankin are brothers and are nephews of
Frank E. Taplin, Jr. and are cousins of David F. Taplin (who is the son of
Frank E. Taplin, Jr.) and Britton T. Taplin (who is a nephew of Frank E.
Taplin, Jr.).
B. Executive Officers of the Company
---------------------------------
The following tables set forth certain information relating to
the executive officers of the Company and NACCO Materials Handling Group, Inc.
Executive officers of the Company serve at the will of the Board of Directors.
<TABLE>
<CAPTION>
Name Age Employment History
---- --- ------------------
<S> <C> <C>
Reginald R. Eklund 54 President and Chief Executive Officer (since September 1992). President and Chief
Operating Officer (prior to 1990 to September 1992). Since January 1, 1994, President and
Chief Executive Officer of NACCO Materials Handling Group, Inc. Vice President of Hyster
and Yale (from August 1993 through December 1993). President and Chief Executive Officer
of Yale (from prior to 1990 to August 1993) and President and Chief Executive Officer of
Hyster (from September 1992 to August 1993).
Glen P. Baunsgard 57 Vice President, Parts Operations and Aftermarket Strategy of NACCO Materials Handling
Group, Inc. (since January 1, 1994). Vice President, Parts Operations and Aftermarket
Strategy of the Company (from August 1993 through December 1993). Vice President,
Aftermarket Development of the Company and Hyster (from August 1992 through August 1993).
Vice President, President, North American Industrial Truck Division of Hyster (from prior
to 1990 to August 1992).
</TABLE>
- 19 -
<PAGE> 21
<TABLE>
<CAPTION>
Name Age Employment History
---- --- ------------------
<S> <C> <C>
Bergen I. Bull 55 Vice President, General Counsel and Secretary. Vice President, General Counsel and
Secretary of NACCO Materials Handling Group, Inc. (since January 1, 1994). Vice President,
Corporate Administration, General Counsel and Secretary of Hyster (from prior to 1990
through December 1993). Vice President and Assistant Secretary of Yale (from November
1990 through 1993).
Michael P. Brogan 44 Vice President, European Engineering and Parts Distribution, NACCO Materials Handling
Group, Inc. (since February, 1995). Technical Director, Engineering and Parts Operations,
NACCO Materials Handling Group, Ltd. (from January, 1994 to February, 1995). Technical
Director, Engineering and Parts Operations (from September 1992 to January 1994) and
Technical Director (from May 1992 to September 1992) of Hyster-Yale Europe Materials
Handling, Limited. Technical Director (from prior to 1990 to May 1992) of Hyster Europe,
Ltd.
Paolo de Chiara 46 Vice President, Managing Director, Hyster Europe, Ltd. (from February 8, 1995). Director
and General Manager Plugs Product Group, Champion Spark Plug, unit of Cooper Industries
(from 1993 to 1994). Director of Sales and Distribution Europe (from 1992 to 1994).
European Operations Manager, Bleden Electronics, unit of Cooper Industries (from 1990 to
1992).
Darrell K. Cross 46 Vice President, Engineering of NACCO Materials Handling Group, Inc. (since January 1,
1994). Vice President, Engineering of the Company and Hyster (from May 1992 through
December 1993). Director, Test and Research of Hyster (from prior to 1990 to 1992).
Gregory J. Dawe 46 Vice President, Manufacturing, Americas of NACCO Materials Handling Group, Inc. (since
January 1, 1994). Vice President, Manufacturing, Americas of the Company (from November
1993 through December 1993). Vice President, Manufacturing and Quality Planning, Clark
Materials Handling Company, a manufacturer of industrial trucks and other materials
handling equipment (from prior to 1990 to August 1993).
</TABLE>
- 20 -
<PAGE> 22
<TABLE>
<CAPTION>
Name Age Employment History
---- --- ------------------
<S> <C> <C>
G. Michael Decker 53 Vice President, Finance and Chief Financial Officer (since February 1993). Vice President,
Finance and Chief Financial Officer of NACCO Materials Handling Group, Inc. (since January
1, 1994). Vice President, Finance and Chief Financial Officer of Hyster and Yale (from
February 1993 through December 1993). Vice President, Finance, Secretary and Chief
Financial Officer for Doehler Jarvis Ltd. Partnership (from 1991 to 1993) (casting
manufacturer). Senior Vice President, Finance, Treasurer and Chief Financial Officer
(from prior to 1990 to 1990) of The Manitowoc Company, Inc. (manufacturer serving heavy
construction, food service and shipbuilding industries).
J. Stephen Finney 53 Vice President, President, Hyster Company of NACCO Materials Handling Group, Inc. (since
January 1, 1994). Vice President, Hyster Marketing, North America of the Company (from
May 1992 through December 1993). President of Hyster (from August 1993 through December
1993). Vice President, Marketing, North America of Hyster (from May 1992 to August 1993).
Vice President, Sales, North American Industrial Truck Division of Hyster (from prior to
1990 to May 1992).
Daniel P. Gimmy 49 Vice President, Law and Assistant Secretary of NACCO Materials Handling Group, Inc. (since
January 1, 1994). Vice President, Law and Secretary of Yale (from prior to 1990 through
December 1993).
Dennis D. Hartman 51 Vice President, Warehousing Products, Worldwide, of NACCO Materials Handling Group, Inc.
(since February, 1995). Vice President, Product Strategy and Business Development (from
January, 1994 to February, 1995). Vice President, Product Strategy and Business
Development of the Company (from November 1993 through December 1993). Vice President,
Product Planning, Worldwide (from May 1992 to November 1993). Vice President, Product
Planning (prior to 1990 to May 1992). Vice President, Product Planning of Hyster (from
prior to 1990 to May 1992).
Julie C. Hui 38 Controller (since January, 1995). Controller of NACCO Materials Handling Group, Inc.
(since January, 1995). Controller, Bun-Brown Corporation, (manufacturer micro electronics
and systems products) (from 1992 to January 1995). Director of Accounting and Tax, (1991).
Tax Manager (from prior to 1990 to 1990).
</TABLE>
- 21 -
<PAGE> 23
<TABLE>
<CAPTION>
Name Age Employment History
---- --- ------------------
<S> <C> <C>
Ronny J. Leptich 51 Vice President, Engineering, Worldwide of NACCO Materials Handling Group, Inc. (since
January 1, 1994). Vice President, Engineering, Worldwide of the Company and Hyster (from
May 1992 and August 1992, respectively, through December 1993). Vice President, Hyster-
Yale Engineering (from May 1991 to May 1992). Vice President, Hyster Engineering (from
prior to 1990 to May 1991). Vice President, Engineering for Hyster (from prior to 1990 to
August 1992).
Thomas A. Magill 53 Vice President, Manufacturing, Europe of NACCO Materials Handling Group, Inc. (since
January 1, 1994). Vice President, Manufacturing, Europe of the Company (from May 1992
through December 1993). Director of Manufacturing, Hyster-Europe (from February 1990 to
May 1992).
Jeffrey C. Mattern 42 Treasurer (since August 1992). Treasurer of NACCO Materials Handling Group, Inc. (since
January 1, 1994). Treasurer of Hyster and Yale (from August 1992 through December 1993).
Assistant Treasurer for Harnischfeger Industries, Inc. (manufacturer papermaking machinery,
mining and materials handling equipment) (from prior to 1990 to July 1992).
William C. Maxwell 49 Vice President, Finance, Europe of NACCO Materials Handling Group, Inc. (since January 1,
1994). Vice President, Finance, Europe of the Company (from May 1993 through December
1993). Director, Financial Planning and Analysis of Hyster (from prior to 1990 to 1993).
Frank G. Muller 53 Vice President (since January 1, 1994). Vice President, President, Americas of NACCO
Materials Handling Group, Inc. (since January 1, 1994). Vice President, President, Hyster-
Yale Americas of the Company (from May 1993 to December 1993). Vice President,
Manufacturing, Americas (from May 1992 to May 1993). Vice President, Manufacturing of Yale
(from prior to 1990 to 1992). Vice President of Hyster and Yale (from February 1993
through December 1993).
Ronald D. Muller 48 Vice President, Manufacturing and Component Strategy, Worldwide of NACCO Materials Handling
Group, Inc. (since February, 1995). Vice President, Manufacturing, Worldwide (from January,
1994 to February, 1995). Vice President, Manufacturing, Worldwide of the Company (from May
1992 through December 1993). Vice President, Manufacturing, North American Industrial
Truck Division of Hyster (from prior to 1990 to May 1992).
</TABLE>
- 22 -
<PAGE> 24
<TABLE>
<CAPTION>
Name Age Employment History
---- --- ------------------
<S> <C> <C>
William P. O'Connell 59 Vice President, Engineering of NACCO Materials Handling Group, Inc. (since January 1,
1994). Vice President, Engineering of the Company (from May 1992 through December 1993).
Vice President, Hyster-Yale Engineering (from May 1991 to May 1992). Vice President, Yale
Engineering (from prior to 1990 to May 1991).
David M. Pollock 49 Vice President (since January 1, 1994). Vice President, Big Trucks, Worldwide of NACCO
Materials Handling Group, Inc. (from February 8, 1995). Vice President, Managing Director,
NACCO Materials Handling Group, Ltd. (from January, 1994 to February, 1995). Vice
President, Managing Director, Hyster-Yale Europe of the Company (from May 1992 through
December 1993). Vice President, Managing Director, Hyster Europe (from prior to 1990 to
May 1992). Vice President of Yale (from May 1992 through 1993).
Victoria L. Rickey 42 Vice President, Managing Director, NACCO Materials Handling Group, Ltd. of NACCO Materials
Handling Group, Inc. (since January, 1995). Senior Vice President, International Business
Group J.I. Case (manufacturer of agricultural and construction equipment) (from 1993 to
January, 1995). Vice President, Agricultural Equipment Marketing (from prior to 1990 to
1993).
Edward W. Ryan 56 Vice President, Marketing and Counterbalanced Trucks, Woldwide, of NACCO Materials
Handling Group, Inc. (since February 8, 1995). Vice President, President, Yale Materials
Handling Corporation of NACCO Materials Handling Group, Inc. (from January 1, 1994 to
February, 1995). Vice President, Yale Marketing of the Company (from May 1992 through
December 1993). President of Yale (from August 1993 through December 1993).
Michael K. Smith 50 Vice President, Finance and Information Systems, Americas of NACCO Materials Handling
Group, Inc. (since February 9, 1994). Vice President, Finance, Americas (from January 1,
1994 to February 9, 1994). Vice President, Finance, Americas of the Company (from May
1993 through December 1993). Vice President, Finance, Hennessy Industries, manufacturer of
tire replacement equipment (from 1991 to 1993). Vice President, Finance and Business,
Bendix Automotive Systems Group of Bendix Corporation, a producer of automotive equipment
(from prior to 1990 to 1990).
</TABLE>
- 23 -
<PAGE> 25
<TABLE>
<CAPTION>
Name Age Employment History
---- --- ------------------
<S> <C> <C>
Graham D. Tribe 52 Vice President, Managing Director, NACCO Materials Handling Pty. Ltd. (since May 11, 1994).
Managing Director Hyster Australia Pty. Ltd. (from prior to 1990 to May, 1994).
Colin Wilson 40 Vice President, Marketing, Yale Europe of NACCO Materials Handling Group, Inc. (since
January, 1994). Vice President, Marketing, Yale Europe of the Company (from May 1992
through December 1993). Marketing Director, Yale Europe Materials Handling Limited (from
January 1992 to May 1992). Sales and Marketing Director, Yale Materials Handling Limited
(from prior to 1990 to January 1992).
</TABLE>
- 24 -
<PAGE> 26
ITEM 11. EXECUTIVE COMPENSATION
--------------------------------
The following table sets forth the annual, long-term and all
other compensation for services in all capacities to the Company of the five
persons who were, as of December 31, 1994, the Chief Executive Officer and the
Company's four most highly compensated executive officers other than the Chief
Executive Officer (the "Named Executive Officers").
<TABLE>
Summary Compensation Table
--------------------------
<CAPTION>
Long-Term
Annual Compensation Compensation
Payouts
------------------------------------------------------------------
Name & Principal Fiscal Salary Bonus Other Annual LTIP All Other
Position Year ($) ($) (3) Compensation Payouts compensations
($) ($) ($)
<S> <C> <C> <C> <C> <C> <C>
Reginal R. Eklund 1994 $349,900(1) $157,001 --- --- $38,494(7)
President and Chief 1993 $333,500(1) $96,274 --- --- $24,384(7)
Executive Officer
1992 $286,018(1) $86,226 $12,419(4) $199,986(6) $30,117(7)
David M. Pollock 1994 $231,935(2) $84,442 $5,752(5) --- $7,758(8)
Vice President, Big
Trucks, Worldwide 1993 $232,096(2) $39,781 $2,574(5) --- $2,636(8)
1992 $239,570(2) $41,250 $3,477(5) --- $3,407(8)
Frank G. Muller 1994 $207,145(1) $112,178 --- --- $23,035(9)
Vice President,
President NACCO 1993 $175,706(1) $62,382 --- --- $11,982(9)
Materials Handling
Group, Americas 1992 $137,885(1) $28,347 --- --- $9,681(9)
G. Michael Decker 1994 $188,500(1) $57,210 --- --- $35,340(9)
Vice President,
Finance, Chief 1993 $168,597(1) $37,986 --- --- $3,127(9)
Financial Officer
NACCO Materials 1992 --- --- --- --- ---
Handling Group
Edward W. Ryan 1994 $161,702(1) $45,860 --- --- $18,346(9)
Vice President,
Marketing and 1993 $151,921(1) $29,036 --- --- $12,862(9)
Counterbalanced 1992 $143,316(1) $25,532 --- --- $9,206(9)
Trucks, Worldwide
<FN>
(1) Under current disclosure requirements of the SEC, certain of the
amounts listed are being reported as "Salary", although the Company
considers them as cash payments in lieu of perquisites. These
payments of cash are determined by the Company's Nominating
Organization and Compensation Committee and are considered to be at
competitive levels. For Mr. Eklund, the amounts listed for 1994, 1993
and 1992 include payments of cash in lieu of perquisites of $39,900,
$38,500 and $26,014, respectively. For Mr. Muller, the amounts listed
for 1994, 1993 and 1992 include payments of cash in lieu of
perquisites of $23,496, $18,266
</TABLE>
- 25 -
<PAGE> 27
and $9,170, respectively. For Mr. Decker, the amounts listed for 1994
and 1993 include payments of cash in lieu of perquisites of $13,900
and $12,265, respectively. For Mr. Ryan, the amounts listed for 1994,
1993 and 1992 include payments of cash in lieu of perquisites of
$11,400, $9,013 and $7,308, respectively.
(2) Includes overseas allowances paid to Mr. Pollock of $50,835, $50,996,
and $69,445 for the years 1994, 1993, and 1992, respectively.
(3) These amounts were paid in cash pursuant to the NACCO Materials
Handling Group, Inc. Annual Incentive Compensation Plan.
(4) For Mr. Eklund, the amount listed for 1992 consists of annual interest
of $12,419 paid on a $200,000 promissory note previously held by him
("Mr. Eklund's Promissory Note"), which note bore interest at a rate
equal to a 13-week U.S. Treasury Bill plus 2%, with a cap of 12%,
compounded quarterly, which was payable by Yale on February 28, 1995
and which note represented the balance due to Mr. Eklund under the
Yale Materials Handling Corporation 1985 Employee Incentive Plan that
was terminated effective January 1, 1990. The principal and accrued
interest of Mr. Eklund's Promissory Note were pre-paid in 1992. See
note (6) below.
(5) For Mr. Pollock the amounts shown represent the value of the use of a
car.
(6) The amount listed was paid in cash to Mr. Eklund upon the pre-payment
of Mr. Eklund's Promissory Note. See Note 4 above.
(7) For Mr. Eklund, the amounts listed include: for 1994, 1993 and 1992
$13,270, $15,370 and $14,963, respectively, consisting of Company
contributions under the NACCO Materials Handling Group, Inc. Profit
Sharing Plan; for 1992, $9,464 consisting of deferred payments under
the Yale Short-Term Incentive Compensation Deferral Plan earned by Mr.
Eklund for 1986; for 1994, 1993 and 1992, $25,224, $9,014 and $5,690,
respectively, consisting of credits under the NACCO Materials Handling
Group, Inc. Unfunded Benefit Plan.
(8) For Mr. Pollock the amounts listed were contributed by the Company to
match before-tax contributions made under the NACCO Materials Handling
Group, Inc. Profit Sharing Plan. For 1994, the amount includes $2,702
for Company matching contributions to this plan and $5,056 in credits
under the NACCO Materials Handling Group, Inc. Unfunded Benefit Plan.
(9) For the years 1993 and 1992, the amounts listed for Messrs. Muller,
Decker and Ryan consist of contributions made by the Company to the
NACCO Materials Handling Group, Inc. Profit Sharing Plan. For 1994,
Company contributions to this plan for Messrs. Muller Decker and Ryan
were $10,314, $10,314 and $12,282 respectively. For 1994, $10,237,
$6,513 and $3,998 represent credits for Messrs. Muller, Decker and
Ryan respectively under the NACCO Materials Handling Group, Inc.
Unfunded Benefit Plan. For 1994 the amount listed for Mr. Decker also
includes $15,513 Company reimbursement for moving expenses.
- 26 -
<PAGE> 28
Compensation Committee Interlocks and Insider Participation
-----------------------------------------------------------
During 1994, the members of the Nomination, Organization and
Compensation Committee of the Company were John J. Dwyer, Robert M. Gates,
Dennis W. LaBarre, Alred M. Rankin (through January 23, 1994), Alred M. Rankin,
Jr. and John C. Sawhill.
Mr. LaBarre is a partner in the law firm of Jones, Day, Reavis &
Pogue. Such firm provided legal services on behalf of the Company during 1994
on a variety of matters, and it is anticipated that such firm will provide such
services in 1995.
Pension Plan
------------
NACCO Materials Handling Group, Inc. Pension Plans
Mr. Pollock is covered by the non-contributory defined benefit
cash balance plans (qualified and non-qualified) of the Company. Each year,
effective as of January 1, 1992, an amount is credited to a notional account
for each covered employee equal to a percentage of the employee's compensation
(including bonuses and salary deferrals) for such year, in accordance with an
age-based formula that is integrated with Social Security. The notional
account balances are then credited with interest each year until the employee's
normal retirement date (generally, age 65) at a stated rate of interest. The
notional account balances are paid in the form of a lump sum payment or
converted to an annuity to provide monthly benefit payments.
The estimated annual pension benefit (including prior plan
benefits, if any) for Mr. Pollock under the cash balance plans, which would be
payable on a straight life annuity basis at normal retirement age, is $89,300.
Messrs. Eklund, Decker, Muller and Ryan have never been covered
by any defined benefit pension plans of the Company, Hyster or Yale.
Compensation of Directors
-------------------------
The Company's directors are compensated for their service to the
Company in accordance with the current practices of NACCO. Directors of the
Company who are employees of NACCO will be compensated principally by NACCO and
will participate in employee benefit plans of NACCO. Currently, Mr. Alfred M.
Rankin, Jr. is employed by NACCO and receives his compensation and employee
benefits from NACCO. Officers of the Company who are also directors receive no
additional compensation for their services as a director. Mr. Eklund is both
an officer and a director of the Company. Mr. Eklund receives his salary and
benefits from the Company. The directors of the Company who are also directors
of NACCO are currently compensated by NACCO with respect to their Company Board
of Directors activities, and the Company reimburses NACCO for a pro rata share
(with NACCO and two other subsidiaries of NACCO) of the compensation paid by
NACCO to its directors who are also directors of NACCO. Each NACCO director
who is not an officer of NACCO receives a retainer of $26,400 for each calendar
year of service on the NACCO and subsidiary Board of Directors. In addition,
each such director receives $500 for attending each meeting of the NACCO or
subsidiary Board of Directors and each meeting of a committee thereof. Such
fees for attendance at Board meetings and committee meetings may not exceed
$1,000 per day. In addition, the chairman of each committee of the NACCO or
subsidiary Board of Directors receives $4,000 for each calendar year for
service as committee chairman. Directors of the
- 27 -
<PAGE> 29
Company who are neither directors of NACCO nor officers of the Company are paid
by the Company $9,000 for each calendar year, plus $500 for attending each
meeting of the Company Board of Directors and each meeting of a committee
thereof (such fees for attendance at Board of Directors' meetings and multiple
committee meetings do not exceed $1,000 per day).
ITEM 12.
--------
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------------------------------------------------------------
The Company
-----------
The Company currently has 10,000 authorized shares of Common
Stock which is the only authorized class of Company capital stock, of which
5,598.857 shares are currently issued and outstanding. NACCO Industries, Inc.,
a Delaware corporation, with its headquarters located at 5875 Landerbrook
Drive, Mayfield Heights, Ohio 44124-4017, is the beneficial owner of 5,435.826
shares (97%) of Common Stock. No officer or director of the Company
beneficially owns any shares of the Common Stock. In connection with the
financing of the acquisition of Hyster, all of the Company's Common Stock owned
beneficially by NACCO was pledged to lenders to secure the Company's
obligations under a Credit Agreement entered into to finance the acquisition.
On February 28, 1995, this Credit Agreement and related security documents were
canceled and the pledge of the Company's common stock was released.
Beneficial Ownership of NACCO Securities
----------------------------------------
Set forth in the following table is the indicated information
with respect to beneficial ownership of Class A Common Stock, par value $1.00
per share ("Class A Common") and Class B Common Stock, par value $1.00 per
share ("Class B Common"), of NACCO, by the directors and Named Executive
Officers of the Company and all executive officers and directors of the Company
as a group as of January 15, 1995. Each share of Class A Common is entitled to
one vote on all matters brought before a meeting of NACCO's stockholders, while
each share of Class B Common is entitled to ten votes on each such matter.
Beneficial ownership of Class A Common and Class B Common has been determined
for this purpose in accordance with Rule 13d-3 of the Securities and Exchange
Commission ("SEC") under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), which provides, among other things, that a person is deemed to
be the beneficial owner of Class A Common or Class B Common if such person,
directly or indirectly, has or shares voting power or investment power in
respect of such stock or has the right to acquire such ownership within sixty
days. Accordingly, the amounts shown in the table do not purport to represent
beneficial ownership for any purpose other than compliance with SEC reporting
requirements. Further, beneficial ownership as determined in this manner does
not necessarily bear on the economic incidence of ownership of Class A Common
or Class B Common.
- 28 -
<PAGE> 30
<TABLE>
<CAPTION>
Amount and Nature of Beneficial Ownership
-----------------------------------------
Sole Shared
Voting and Voting or Percent of
Title of Investment Investment Aggregate Class
Name Class Power Power Amount (1)(2)
---- -------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Frank E. Taplin, Jr. Class A 464,807 14,000(3) 478,807 6.60%
Class B 284,728 7,000(3) 291,728(4) 16.94%
Owsley Brown II Class A 1,282 --- 1,282 ---
Class B --- --- --- ---
John J. Dwyer Class A 1,215 --- 1,215 ---
Class B --- --- --- ---
Robert M. Gates Class A 401 --- 401 ---
Class B --- --- --- ---
E. Bradley Jones Class A 1,115 --- 1,115(5) ---
Class B 200 --- 200 ---
Dennis W. LaBarre Class A 1,215 --- 1,215 ---
Class B 100 --- 100 ---
Yoshinori Ohno Class A --- --- --- ---
Class B --- --- --- ---
Alfred M. Rankin, Jr. Class A 93,844 91,553(6) 210,397(7) 2.90%
Class B 58,998 16,000(6) 74,998(4) 4.35%
Claiborne R. Rankin Class A 114,616 --- 114,616(8) 1.58%
Class B 66,518 --- 66,518(4)(8) 3.86%
John C. Sawhill Class A 4,509 --- 4,509 ---
Class B --- --- --- ---
Britton T. Taplin Class A 18,236 --- 18,236 0.25%
Class B 27,495 --- 27,495(4) 1.60%
David F. Taplin Class A 14,955 --- 14,955 0.21%
Class B 13,550 --- 13,550(4) 0.79%
Richard B. Tullis Class A 3,053 --- 3,053 ---
Class B --- --- --- ---
Reginald R. Eklund Class A 1,000 --- 1,000 ---
Class B --- --- --- ---
David M. Pollock Class A --- --- --- ---
Class B --- --- --- ---
G. Michael Decker Class A --- --- --- ---
Class B --- --- --- ---
</TABLE>
- 29 -
<PAGE> 31
<TABLE>
<CAPTION>
Sole Shared
Voting and Voting or Percent of
Title of Investment Investment Aggregate Class
Name Class Power Power Amount (1)(2)
---- -------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Frank G. Muller Class A 178 500 678 ---
Class B --- --- --- ---
Edward W. Ryan Class A 378 --- 378 ---
Class B --- --- --- ---
All executive Class A 722,169(4) 106,403 853,572(7)(9) 11.76%
officers and Class B 451,589 23,000 474,589(4) 27.55%
directors as a group
(38 persons)
<FN>
(1) The shares included in note 7 were deemed to be outstanding as of
January 15, 1995 for purposes of calculating the percentage owned at
such date pursuant to Rule 13d-3 under the Exchange Act.
(2) Less than 0.1% except as otherwise indicated.
(3) Frank E. Taplin, Jr., his sister Clara Taplin Rankin, and his brother
Thomas E. Taplin are co-settlors of a trust holding an aggregate of
42,000 shares of Class A Common and 21,000 shares of Class B Common,
in which each retains a reversionary interest with respect to 14,000
of such shares of Class A Common and 7,000 of such shares of Class B
Common. The Class B Common held by the foregoing trust is subject to
the Stockholders' Agreement described in note (4).
(4) A Schedule 13D filed with the SEC with respect to Class B Common on
March 24, 1990, and amended on April 11, 1990 by Amendment No. 1, on
March 18, 1991 by Amendment No. 2, on March 23, 1992 by Amendment No.
3 and on March 10, 1993 by Amendment No. 4, and amended and restated
on March 30, 1994 by Amendment No. 5 and amended on March 28, 1995 by
Amendment No. 1 to the amended and restated Schedule 13D (the
"Schedule 13D"), reported that the following individuals and entities,
together in certain cases with related revocable trusts and
custodianships: Clara Taplin Rankin, Alfred M. Rankin, Jr., Victoire
G. Rankin, Helen R. Butler, Clara T. Rankin, Thomas T. Rankin, Matthew
M. Rankin, Claiborne R. Rankin, Chloe O. Rankin, Roger F. Rankin,
Bruce T. Rankin, Frank E. Taplin, Jr., Margaret E. Taplin, Martha S.
Kelly, Susan S. Panella, Jennifer T. Jerome, Caroline T. Ruschell,
David F. Taplin, Thomas E. Taplin, Beatrice B. Taplin, Thomas E.
Taplin, Jr., Theodore D. Taplin, Britton T. Taplin, Frank F. Taplin,
and National City Bank, as trustee of certain irrevocable trusts for
the benefit of certain individuals named above, their family members
and others (collectively, together with such individuals, revocable
trusts and custodianships, the "Signatories"), are parties with NACCO
and Society National Bank (successor by merger to Ameritrust Company
National Association), as depository, to a Stockholders' Agreement,
dated as of March 15, 1990, as amended, covering the shares of Class B
Common beneficially owned by each of the Signatories (the
"Stockholders' Agreement"). The Stockholders' Agreement requires that
each Signatory, prior to any conversion of such Signatory's shares of
Class B Common into Class A
</TABLE>
- 30 -
<PAGE> 32
Common or prior to any sale or transfer of Class B Common to any
permitted transferee (under the terms of the Class B Common) who has
not become a Signatory, to offer such shares to all of the other
Signatories on a pro rata basis. A Signatory may sell or transfer all
shares not purchased under the right of first refusal as long as they
first are converted into Class A Common prior to their sale or
transfer. Accordingly, the Signatories may be deemed to have acquired
beneficial ownership of all of the Class B Common subject to the
Stockholders' Agreement, an aggregate of 1,542,757 shares, as a
"group" as defined under the Exchange Act. The shares subject to the
Stockholders' Agreements constitute 89.56% of the Class B Common
outstanding on January 15, 1995, or 63.01% of the combined voting
power of all Class A Common and Class B Common outstanding on such
date. Certain Signatories own Class A Common, which is not subject to
the Stockholders' Agreement. Under the Stockholders' Agreement, NACCO
may, but is not obligated to, buy any of the shares of Class B Common
not purchased by the Signatories following the trigger of the right of
first refusal. The Stockholders' Agreement does not restrict in any
respect how a Signatory may vote such Signatory's shares of Class B
Common. The Class B Common shown in the foregoing table as
beneficially owned by named persons who are Signatories is subject to
the Stockholders' Agreement.
(5) While Mr. Jones, a director of the Company, is a Trustee of Fidelity
Funds, he has not exercised and does not presently intend to exercise
any voting or investment power over any of the 1,161,769 shares of
Class A Common in which a Schedule 13G filed with the SEC for NACCO on
February 14, 1992 and amended on February 16, 1993 by Amendment No. 1
and amended and restated on February 14, 1994 by Amendment No. 2, and
amended on February 13, 1995 by Amendment No. 3 reported that FMR
Corp. and certain related parties, including Fidelity Funds, have a
beneficial ownership interest.
(6) Represents shares in a certain trust of which Mr. Rankin, Jr. became a
trustee on February 9, 1994, and a certain trust of which he became a
trustee on March 10, 1994.
(7) Includes the following shares which such persons have, or had, within
60 days after January 15, 1995, the right to acquire upon the exercise
of stock options: Mr. Rankin, Jr., 25,000 shares of Class A Common,
and all executive officers and directors of the company as a group,
25,000 shares of Class A Common.
(8) Includes 16,861 shares of Class A Common and 4,688 shares of Class B
Common owned by members of Mr. Rankin's immediate family for which Mr.
Rankin serves as custodian, as to which Mr. Rankin disclaims
beneficial ownership.
(9) Includes 20 shares of Class A Common owned by a member of the
immediate family of an executive officer as to which such executive
officer disclaims beneficial ownership.
Frank E. Taplin, Jr. and Thomas E. Taplin (who was, as of December 31, 1994,
the beneficial owner of an aggregate of 574,000 shares of Class A Common and,
as of January 15, 1995, 317,000 shares of Class B Common) are brothers, and
Clara Taplin Rankin (who was, as of December 31, 1994, the beneficial owner of
an aggregate of 638,091 shares of Class A Common and, as of January 15, 1995,
336,247 shares of Class B Common) is their sister. Britton T. Taplin is the
- 31 -
<PAGE> 33
son of Thomas E. Taplin and the nephew of Frank E. Taplin, Jr. and Clara Taplin
Rankin. David F. Taplin is the son of Frank E. Taplin, Jr. and the nephew of
Thomas E. Taplin and Clara Taplin Rankin. Clara Taplin Rankin is the mother of
Alfred M. Rankin, Jr. and Claiborne R. Rankin. The combined beneficial
ownership of such persons equals 2,049,102 shares or 28.22% of Class A Common
and 1,127,536 shares or 65.46% of Class B Common outstanding on January 15,
1995. The combined beneficial ownership of all directors of the Company,
together with Clara Taplin Rankin, Thomas E. Taplin and all of the executive
officers of the Company whose beneficial ownership of Class A Common and Class
B Common (including shares which would be held by such directors if they
exercised certain stock options) must be disclosed in the foregoing table in
accordance with Rule 13d-3 under the Exchange Act, equals 2,065,663 shares or
28.45% of Class A Common and 1,127,836 shares or 65.47% of Class B Common
outstanding on January 15, 1995 (including shares which would be outstanding if
certain stock options were exercised by such directors). Such shares of Class
A Common and Class B Common represent 54.50% of the combined voting power of
all Class A Common and Class B Common outstanding on such date (including those
shares which would be outstanding if the stock options referred to above were
exercised).
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------------
As a result of its ownership of in excess of 97% of the Company's
stock, NACCO controls the Company and has the power to elect the Company's
entire Board of Directors and to make certain strategic decisions concerning
the Company (including decisions relating to mergers, consolidations or the
sale of all or substantially all of the assets of the Company) without the
approval of other stockholders. However, the Company has operated and
conducted its day-to-day business autonomously.
Tax Agreement
-------------
So long as the Company continues to meet the definition of an
included corporation for Federal income tax purposes, as that definition may
change from time to time, NACCO intends to include the Company in the
consolidated Federal income tax returns of NACCO. NACCO and the Company are
parties to an income tax sharing agreement providing for the allocation of
Federal income tax liabilities. Under the agreement, the Company will be
compensated by NACCO for certain of its tax attributes (e.g., any available tax
credits), while all Federal income tax deficiencies and refunds relating to the
Company for prior and future years are charged or credited to the Company as
they are finally determined. Under this arrangement, the Company will pay to
NACCO an amount equal to the taxes that would be payable by the Company if it
were a corporation filing a separate return.
A similar arrangement currently exists between NACCO and NMHG and
between NACCO and each of its other subsidiaries.
- 32 -
<PAGE> 34
Directors' and Officers' Liability Insurance and Other NACCO Services
---------------------------------------------------------------------
NACCO provides directors' and officers' liability insurance to
the Company's directors and officers, with the Company reimbursing NACCO for a
portion of such costs. The Company may also make use and be charged for the
use of NACCO's corporate airplane. NACCO is also expected to provide certain
legal, accounting and insurance services to the Company for which it will be
reimbursed.
Other
-----
Mr. Yoshinori Ohno is President of S-Y. S-Y manufactures
semi-complete or complete industrial lift trucks which are purchased by NMHG,
Yale Europe and Jungheinrich. S-Y also markets in Japan industrial truck
products it manufactures and which it imports from NMHG. For a discussion of
inter-affiliate transactions involving S-Y see Note F, Investments, on pages
F-12 and F-13.
- 33 -
<PAGE> 35
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
--------------------------------------------------------------------------
(a)(1) and (2) The response to Item 14(a)(1) and (2) is set
forth beginning at page F-1 of this Annual Report on Form 10-K.
(a)(3) Listing of Exhibits - See the exhibit index beginning at
page X-1 of this Annual Report on Form 10-K.
(b) The Company has not filed any Current Reports on Form 8-K
during the fourth quarter of 1994.
(c) The response to Item 14(c) is set forth beginning at page
X-1 of this Annual Report on Form 10-K.
(d) Financial Statement Schedule - The response to Item 14(d)
is set forth on page F-26 of this annual Report on Form 10-K.
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(D) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT
TO SECTION 12 OF THE ACT.
Neither an annual report nor a proxy statement covering the
Company's last fiscal year has been circulated or is going to be circulated to
security holders.
- 34 -
<PAGE> 36
SIGNATURES
----------
Pursuant to the requirements of Section 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Hyster-Yale Materials Handling, Inc.
By: /s/ Reginald R. Eklund
-----------------------------------------
Reginald R. Eklund
President and Chief Executive Officer
Date: March 30, 1995
- 35 -
<PAGE> 37
Pursuant to the requirements of the Securities Exchange Act of
1934, this Report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
/s/ Reginald R. Eklund President and Chief Executive March 30, 1995
------------------------ Officer (Principal Executive
Reginald R. Eklund Officer), Director
/s/ G. Michael Decker Vice President, Finance March 30, 1995
------------------------ and Chief Financial Officer
G. Michael Decker (Principal Financial Officer)
/s/ Julie C. Hui Controller (Principal March 30, 1995
------------------------ Accounting Officer)
Julie C. Hui
* Owsley Brown II Director March 30, 1995
------------------------
Owsley Brown II
* John J. Dwyer Director March 30, 1995
------------------------
John J. Dwyer
* Robert M. Gates Director March 30, 1995
------------------------
Robert M. Gates
* E. Bradley Jones Director March 30, 1995
------------------------
E. Bradley Jones
* Dennis W. LaBarre Director March 30, 1995
------------------------
Dennis W. LaBarre
* Yoshinori Ohno Director March 30, 1995
------------------------
Yoshinori Ohno
* Alfred M. Rankin, Jr. Director March 30, 1995
------------------------
Alfred M. Rankin, Jr.
* Claiborne R. Rankin Director March 30, 1995
------------------------
Claiborne R. Rankin
* John C. Sawhill Director March 30, 1995
------------------------
John C. Sawhill
* Britton T. Taplin Director March 30, 1995
------------------------
Britton T. Taplin
* David F. Taplin Director March 30, 1995
------------------------
David F. Taplin
</TABLE>
- 36 -
<PAGE> 38
<TABLE>
<S> <C> <C>
* Frank E. Taplin, Jr. Director March 30, 1995
------------------------
Frank E. Taplin, Jr.
* Richard B. Tullis Director March 30, 1995
------------------------
Richard B. Tullis
<FN>
* Bergen I. Bull, by signing his name hereto, does hereby sign this Annual
Report on Form 10-K on behalf of each of the above named and designated
officers and directors of the Company pursuant to a Power of Attorney executed
by such persons and filed with the Securities and Exchange Commission.
/s/ Bergen I. Bull March 30, 1995
--------------------------------
Bergen I. Bull, Attorney-in-Fact
</TABLE>
- 37 -
<PAGE> 39
ANNUAL REPORT ON FORM 10-K
ITEM 8, ITEM 14 (A) (1) AND (2), AND ITEM 14 (D)
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
YEAR ENDED DECEMBER 31, 1994
HYSTER-YALE MATERIALS HANDLING, INC.
PORTLAND, OREGON
F-1
<PAGE> 40
FORM 10-K
ITEM 14 (A) (1) AND (2)
HYSTER-YALE MATERIALS HANDLING, INC.
LIST OF FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following consolidated financial statements of Hyster-Yale Materials
Handling, Inc. and subsidiaries are included in item 8:
Report of Independent Accountants for years ended December 31, 1994,
1993 and 1992
Consolidated balance sheets--December 31, 1994 and December 31, 1993
Consolidated statements of income--Years ended December 31, 1994, 1993
and 1992
Consolidated statements of cash fLows--Years ended December 31, 1994,
1993 and 1992
Consolidated statements of stockholders equity--Years ended December
31, 1994, 1993 and 1992
Notes to consolidated financial statements--December 31, 1994
The following consolidated financial statement schedule of Hyster-Yale
Materials Handling, Inc. and subsidiaries is included in Item 14 (d):
Schedule 11 - VaLuation and qualifying accounts
ALL other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.
F-2
<PAGE> 41
Report of Independent Public Accountants
To the Board of Directors and Stockholders of
Hyster-YaLe Materials Handling, Inc.:
We have audited the accompanying consolidated balance sheets of Hyster-YaLe
Materials Handling, Inc. (an indirect, majority-owned subsidiary of NACCO
Industries, Inc.) and subsidiaries as of December 31, 1994 and 1993, and the
related consolidated statements of income, stockholders, equity and cash flows
for each of the three years in the period ended December 31, 1994. These
consolidated financial statements and the schedule referred to below are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements and schedule based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as welt as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
aLt material respects, the financial position of Hyster-YaLe Materials
Handling, Inc. and subsidiaries as of December 31, 1994 and 1993, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1994 in conformity with generally accepted
accounting principles.
our audits were made for the purpose of forming an opinion on the basic
consolidated financial statements taken as a whole. The schedule listed in the
List of financial statements and supplementary data is presented for purposes
of complying with the Securities and Exchange ConTnission's rules and is not a
required part of the basic consolidated financial statements. This schedule
has been subjected to the auditing procedures applied in our audit of the basic
consolidated financial statements and, in our opinion, is fairly stated in aLL
material respects in relation to the basic consolidated financial statements
taken as a whole.
ARTHUR ANDERSEN LLP
Portland, Oregon
February 28, 1995
F-3
<PAGE> 42
<TABLE>
CONSOLIDATED BALANCE SHEETS
HYSTER-YALE MATERIALS HANDLING, INC. AND
SUBSIDIARIES
<CAPTION> December 31,
------------------------------------------------
1994 1993
-------- --------
(In thousands)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $10,763 $20,255
Accounts receivable, net 141,232 104,959
Inventories 208,828 151,216
Prepaid expenses and other 9,474 7,547
Assets held for sale 7,884 11,991
Deferred income taxes 5,192 6,639
-------- --------
383,373 302,607
-------- --------
OTHER ASSETS 10,808 9,969
PROPERTY, PLANT AND EQUIPMENT, NET 125,616 121,732
DEFERRED CHARGES:
Goodwill, net 373,076 383,927
Deferred financing costs 4,122 7,285
other 9,254 7,515
-------- --------
386,452 398,727
-------- --------
TOTAL ASSETS $906,249 $833,035
======== ========
<FN>
See notes to consolidated financial statements.
</TABLE>
F-4
<PAGE> 43
<TABLE>
CONSOLIDATED BALANCE SHEETS
HYSTER-YALE MATERIALS HANDLING, INC. AND
SUBSIDIARIES
<CAPTION>
December 31,
------------------------------------------------
1994 1993
-------- --------
(In thousands)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES:
Accounts payable $176,332 $97,753
Short-term obligations 3,120 7,853
Current maturities of Long-term obligations 45,577 28,388
Accrued expenses 80,617 66,664
Accrued income taxes 12,189 22,266
Deferred income taxes 4,034 2,383
-------- --------
321,869 225,307
-------- --------
LONG-TERM OBLIGATIONS, NET OF CURRENT MATURITIES:
Notes payable 132,893 140,591
Senior subordinated debentures 78,524 149,752
-------- --------
211,417 290,343
-------- --------
OTHER LIABILITIES:
Self insurance reserves 35,159 33,098
Deferred income taxes 18,756 14,180
other 13,122 12,981
-------- --------
67,037 60,259
-------- --------
STOCKHOLDERS' EQUITY:
Common stock, par value $1 per share, authorized
10,000 shares; outstanding 5,599 shares 6 6
Capital in excess of par value 198,205 173,205
Retained income 98,395 82,875
Foreign currency translation adjustment 10,511 2,503
Other (1,191) (1,463)
-------- --------
305,926 257,126
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $906,249 $833,035
======== ========
<FN>
See notes to consolidated financial statements.
</TABLE>
F-5
<PAGE> 44
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF INCOME
HYSTER-YALE MATERIALS HANDLING, INC. AND
SUBSIDIARIES
Year Ended December 31,
------------------------------------------------------
1994 1993 1992
------- ------- -------
(In thousands)
<S> <C> <C> <C>
NET SALES $1,178,882 $908,176 $865,889
COST OF SALES 947,375 724,114 673,898
------- ------- -------
Gross Profit 231,507 184,062 191,991
SELLING, ADMINISTRATIVE AND
GENERAL EXPENSES 154,846 133,657 136,851
GOODWILL AMORTIZATION 10,844 10,844 10,844
------- ------- -------
165,690 144,501 147,695
------- ------- -------
Operating Profit 65,817 39,561 44,296
OTHER INCOME (EXPENSE):
Interest income 792 815 1,480
Interest expense (33,744) (40,411) (44,201)
Gain(Loss) on sale of assets 81 2,456 (79)
Other, net 2,870 (4,113) 2,975
------- ------- -------
(30,001) (41,253) (39,825)
------- ------- -------
Income (Loss) Before Income Taxes and 35,816 (1,692) 4,471
Extraordinary Charge
PROVISION FOR INCOME TAXES 17,077 3,428 3,160
------- ------- -------
INCOME(LOSS) BEFORE EXTRAORDINARY CHARGE 18,739 (5,120) 1,311
EXTRAORDINARY CHARGE, NET OF TAX (3,219) (3,292) -
------- ------- -------
NET INCOME(LOSS) $15,520 $(8,412) $1,311
======= ======= =======
<FN>
See notes to consolidated financial statements.
</TABLE>
F-6
<PAGE> 45
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
HYSTER-YALE MATERIALS HANDLING, INC. AND
SUBSIDIARIES
<CAPTION> Year Ended December 31,
------------------------------------------------------
1994 1993 1992
-------- -------- ----------
(In thousands)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income(Loss) $15,520 $(B,412) $1,311
Adjustments to reconcile net income(Loss) to net
cash provided by (used for) operating activities:
Extraordinary charge, net of tax 1,022 2,007
Depreciation and amortization 32,226 31,721 32,177
Deferred income taxes 7,196 (1,335) 423
Other 1,105 2,949 (10,733)
Changes in operating assets and Liabilities:
Accounts receivable (29,492) (11,777) (12,278)
Inventories (51,586) 14,203 (12,335)
Prepaid expenses and other (1,713) (2,261) 1,507
Accounts payable and accrued expenses 71,550 6,319 (7,519)
Accrued income taxes (9,740) 730 (18,352)
-------- -------- --------
Net cash provided by (used for)
operating activities 36,088 34,144 (25,799)
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property, plant and equipment (25,939) (20,208) (24,252)
Proceeds from sale of assets 7,928 3,989 22,294
Other (486) 1,787 108
-------- -------- --------
Net cash used for investing activities (18,497) (14,432) (1,850)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Additions to Long-term obligations 1,378 1,297 258
Reduction of Long-term obligations (96,217) (32,288) (25,574)
Revolving credit facility, net 33,000 (25,500) 25,500
Working capital financing 11,884 16,172
Capital contribution 25,000 28,273
Short-term obligations, net (7,753) 3,153 6,178
Capital grants and other 1,562 2,657 2,020
-------- -------- --------
Net cash provided by (used for) financing activities (31,146) (6,236) 8,382
-------- -------- --------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 4,063 (1,086) (2,664)
-------- -------- --------
CASH AND CASH EQUIVALENTS:
Increase(decrease) for the year (9,492) 12,390 (21,931)
Balance at the beginning of the year 20,255 7,865 29,796
-------- -------- --------
Balance at the beginning of the year $10,763 $20,255 $7,865
<FN>
See notes to consolidated financial statements.
</TABLE>
F-7
<PAGE> 46
<TABLE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
HYSTER-YALE MATERIALS HANDLING, INC. AND
SUBSIDIARIES
<CAPTION> Year Ended December 31,
----------------------------------------------------
1994 1993 1992
-------- -------- --------
(In thousands)
<S> <C> <C> <C>
COMMON STOCK $6 $6 $6
-------- -------- --------
CAPITAL IN EXCESS OF PAR VALUE
Beginning balance 173,205 119,403 119,403
Capital contribution 25,000 53,802 -
-------- -------- --------
198,205 173,205 119,403
-------- -------- --------
RETAINED INCOME:
Beginning balance 82,875 91,287 89,976
Net income(Loss) 15,520 (8,412) 1,311
-------- -------- --------
98,395 82,875 91,287
-------- -------- --------
FOREIGN CURRENCY TRANSLATION ADJUSTMENT:
Beginning balance 2,503 4,695 24,879
Foreign currency translation adjustment 8,008 (2,192) (20,184)
-------- -------- --------
10,511 2,503 4,695
-------- -------- --------
OTHER EQUITY TRANSACTIONS:
Pension Liability Adjustment (1,191) (1,463)
-------- -------- --------
TOTAL STOCKHOLDERS' EQUITY $305,926 $257,126 $215,391
<FN>
See notes to consolidated financial statements.
</TABLE>
F-8
<PAGE> 47
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
FOR THE THREE YEARS ENDED DECEMBER 31, 1994
NOTE A - ACCOUNTING POLICIES
BASIS OF PRESENTATION:
The accompanying 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 subsidiary NACCO Materials
Handling Group, Inc., which is the primary operating business.
PRINCIPLES OF CONSOLIDATION:
The consolidated financial statements include the accounts of Hyster-Yale and
its majority-owned domestic and international subsidiaries except for a
Brazilian subsidiary. Income from Companhia Hyster, the Brazilian subsidiary,
is recognized when cash is received in the form of a dividend. Investments in
Sumitomo Yale Company, Ltd. (S-Y), a 50% owned joint venture and Yale
Financial Services, Inc. (YFS, Inc.), a 20% owned joint venture are accounted
for by the equity method. All significant intercompany accounts and
transactions among the consolidated companies are eliminated in consolidation.
CASH AND CASH EQUIVALENTS:
The Company considers cash equivalents to be investments purchased with a
maturity of three months or less.
INVENTORIES:
Inventories are stated at the lower of cost or market. Cost has been determined
under the last-in, first-out (LIFO) method for domestic inventories and under
the first-in, first-out (FIFO) method with respect to all other inventories.
Costs for inventory valuation include labor, material and manufacturing
overhead.
PROPERTY, PLANT AND EQUIPMENT:
Depreciation of plant and equipment is computed using the straight-line method
over the estimated useful service lives for purposes of financial reporting.
For tax purposes, an accelerated method is generally used. Maintenance and
repairs are expensed as incurred.
GOODWILL:
Goodwill, which represents the excess purchase price paid over the fair value
of the net assets acquired in the 1989 acquisition of Hyster Company, is
amortized on a straight-line basis over 40 years. Amortization was $10.8
million in each of 1994, 1993 and 1992, respectively. Accumulated amortization
was $60.4 million and $49.6 million at December 31, 1994 and 1993. Management
regularly evaluates its accounting for goodwill considering such factors as
historical and future profitability and believes that the asset is realizable
and the amortization period is still appropriate.
F-9
<PAGE> 48
DEFERRED FINANCING COSTS:
Deferred financing costs from the acquisition of Hyster Company are being
amortized over the term of the related indebtedness. Amortization of deferred
financing costs was $1.5 million in 1994, $1.9 million in 1993 and $2.1 million
in 1992. In addition, deferred financing costs of $1.7 million in 1994 and $1.4
million in 1993 were written-off in conjunction with the extraordinary charges
(see Note B).
PRODUCT DEVELOPMENT COSTS:
Expenditures associated with the development of new products and improvements
to existing products are expensed as incurred. These costs amounted to $23.2,
$20.7 and $21.9 million in 1994, 1993 and 1992, respectively.
FOREIGN CURRENCY:
The financial statements of the Company's foreign operations are translated
into United States dollars at year-end exchange rates as to assets and
liabilities and at weighted average exchange rates as to revenues and
expenses. Gains and losses that do not impact cash flows are excluded from net
income. Effects of changes in exchange rates on foreign financial statements is
designated as "foreign currency translation adjustment" and included as a
separate component of stockholders' equity.
FINANCIAL INSTRUMENTS AND DERIVATIVE FINANCIAL INSTRUMENTS:
The fair values of financial instruments have been determined through
information obtained from quoted market sources and management estimates. The
Company does not hold or issue financial instruments or derivative financial
instruments for trading purposes.
The Company enters into forward foreign exchange contracts with terms of
one-to-twelve months. These contracts hedge certain foreign currency
denominated receivables and payables and foreign currency commitments. Gains
and losses on contracts which do not hedge firm commitments are reported
currently in income, while gains and losses from contracts related to firm
commitments are deferred and recognized as part of the cost of the underlying
transaction being hedged.
The Company also enters into interest rate swap agreements with terms ranging
from six months to five years. The differential between the floating interest
rate and the fixed interest rate which is to be paid or received is recognized
in interest expense as the floating interest rate changes over the life of the
agreement.
RECLASSIFICATION:
Certain amounts in the prior periods consolidated financial statements have
been reclassified to conform to the current period's presentation.
NOTE B - EXTRAORDINARY CHARGES
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 retirement of approximately $72 million of the
Company's 12 3/8% subordinated debentures. The Company retired approximately
$48 million of debentures in August 1994 using internally generated funds and a
$25 million equity contribution from existing shareholders. The remaining $24
million of debentures was retired in December 1994 using internally generated
funds and the senior revolving credit facility.
The 1993 extraordinary charge related to retirement of approximately $50
million of subordinated debentures.
F-10
<PAGE> 49
NOTE C - SUPPLEMENTAL CASH FLOW INFORMATION
Supplemental cash flow information is as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
1994 1993 1992
---- ---- ----
(In thousands)
<S> <C> <C> <C>
Interest Paid $36,078 $40,628 $46,645
Income Taxes Paid 15,434 13,279 26,150
Income Tax Refunds Received 1,336 8,238 3,032
Noncash activities:
Capital contribution of
subordinated debentures - $25,529 -
</TABLE>
NOTE D - ACCOUNTS RECEIVABLE
Allowances for doubtful accounts of $3.3 and $4.9 million at December 31, 1994
and 1993, respectively, were deducted from accounts receivable.
NOTE E - INVENTORIES
Inventories are summarized as follows:
<TABLE>
<CAPTION>
DECEMBER 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Finished Goods and Service Parts $82,331 $81,549
Raw Materials and Work in Process 137,897 80,304
LIFO Reserve (11,400) (10,637)
----------- -----------
TOTAL $208,828 $151,216
======== ========
</TABLE>
The cost of inventories has been determined by the last-in first-out (LIFO)
method for 63% of such inventories as of December 31, 1994 and 61% as of
December 31, 1993.
F-11
<PAGE> 50
NOTE F - INVESTMENTS
The Company owns a 50% interest in S-Y. The joint venture operates a facility
in Japan from which the Company purchases certain components, internal
combustion engines and electric forklift trucks. Following is a summary of
unaudited condensed financial information on a separate company basis (before
elimination of intercompany profits) pertaining to S-Y.
Condensed Balance Sheets
<TABLE>
<CAPTION>
November 30,
------------
1994 1993
---- ----
(In thousands and unaudited)
<S> <C> <C>
Assets:
Current Assets $115,003 $82,384
Other Assets 52,617 46,762
---------- ----------
$167,620 $129,146
========== ==========
Liabilities and Stockholders' Equity:
Notes Payable $50,706 $35,213
Other Current Liabilities 77,264 57,395
---------- ----------
Total Current Liabilities 127,970 92,608
Other Liabilities 29,853 28,383
Stockholders' Equity 9,797 8,155
---------- ----------
$167,620 $129,146
========== ==========
</TABLE>
Condensed Statements of Income
<TABLE>
<CAPTION>
Year Ended November 30,
-----------------------
1994 1993 1992
---- ---- ----
(In thousands and unaudited)
<S> <C> <C> <C>
Net Sales $215,180 $159,875 $164,977
Gross Profit 51,497 32,323 34,526
Net Income (Loss) 758 (7,757) (634)
</TABLE>
The Company's purchases from S-Y for 1994, 1993 and 1992 were $92.0, $64.9 and
$47.8 million, respectively. Trade terms on certain payables to S-Y were
extended in 1993 from 60 days to 180 days and to 210 days in 1994. The Company
pays interest at market rates on all amounts owing after 60 days. Payables to
S-Y with terms greater than 60 days are shown as working capital financing in
the consolidated statement of cash flows. The Company's accounts receivable and
accounts payable balances with S-Y were as follows:
F-12
<PAGE> 51
<TABLE>
<CAPTION>
December 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Accounts Receivable $775 $114
Accounts Payable 40,891 22,900
</TABLE>
The Company earned commission income on certain S-Y sales. Commission income
was $0.3, $1.4 and $2.2 million in 1994, 1993 and 1992, respectively. The
Company also reimbursed S-Y $1.5 and $0.5 million for engineering assistance
during 1994 and 1993, respectively.
NOTE G - PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment includes the following:
<TABLE>
<CAPTION>
December 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Land $6,007 $5,401
Buildings 51,551 49,670
Machinery, Tools and Equipment 156,888 135,851
------- -------
214,446 190,922
Less: Accumulated Depreciation (88,830) (69,190)
-------- --------
TOTAL $125,616 $121,732
======== ========
</TABLE>
Depreciation charged to income was $19.9, $18.8 and $19.0 million in 1994, 1993
and 1992, respectively.
F-13
<PAGE> 52
NOTE H - ACCRUED EXPENSES
The components of accrued expenses are summarized as follows:
<TABLE>
<CAPTION>
December 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Wages, Commissions and Bonuses $13,393 $8,729
Interest 6,821 10,680
Warranty 12,539 8,847
Self insurance 8,000 8,994
Sales discounts 9,472 7,851
Other 30,392 21,563
------ ------
$80,617 $66,664
======= =======
</TABLE>
NOTE I - SHORT-TERM AND LONG-TERM OBLIGATIONS
The Company has a Credit Agreement with a group of banks to provide financing
for a portion of the acquisition of Hyster and working capital needs of
Hyster-Yale. The Credit Agreement is secured by all domestic assets and the
pledge of stock of certain subsidiaries. The Credit Agreement provides for a
term note in an aggregate principal amount of $375.0 million and a long-term
revolving credit facility which permits advances and secured letters of credit
to the Company up to an aggregate principal amount of $100.0 million through
expiration in 1997.
Borrowings under the revolving credit facility, which were classified as
long-term, were $33.0 million at December 31, 1994. The commitment fee on the
unused portion of the revolving credit facility is currently at 0.3% per annum.
The term note and the revolving credit facility bear interest at an effective
lender's prime rate plus .75% or LIBOR plus 1.875% subject to reductions based
on favorable performance. The average effective interest rate on the revolving
credit facility was 7.50% and 6.0% in 1994 and 1993 respectively. The interest
rate at December 31, 1994 was 8.50%.
The term note requires quarterly payments expiring May 31, 1997. The average
effective interest rate on the term note inclusive of the effects of interest
rate swaps was 6.34% and 6.5% in 1994 and 1993, respectively.
As further discussed in Note N to the consolidated financial statements, the
Company has entered into unsecured interest rate swap agreements. The interest
rate swap agreements mature at varying lengths from six-months to five years
and effectively change the majority of the Company's floating interest rate
exposure on the term note to a fixed rate. The Company evaluates its exposure
to floating rate debt on an ongoing basis.
The Credit Agreement contains covenants related to minimum net worth, working
capital, debt to equity, and interest and fixed charge coverage ratios. In
addition, the Credit Agreement limits capital spending, investments, sales of
certain assets and dividends. As of December 31, 1994, the Company was in
compliance with all the covenants in the Credit Agreement.
F-14
<PAGE> 53
<TABLE>
Notes payable consist of the following:
<CAPTION>
December 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Credit Agreement - term note $95,298 $139,279
Credit Agreement - revolving credit facility 33,000 -
Other 4,595 1,312
-------- --------
$132,893 $140,591
======== ========
</TABLE>
The senior subordinated debentures in the amount of $78.5 million bear interest
at 12 3/8%. There is a mandatory sinking fund payment on August 1, 1998 of
$78.5 million. As of August 1, 1994, the debentures can be redeemed at a price
of 105 which will drop to 102.5 at August 1, 1995. Restrictions on redeeming
the subordinated debentures are included in the Credit Agreement.
Maturities on long-term obligations for the next five years are as follows:
<TABLE>
<CAPTION>
Year Ending
December 31, Amount
------------ ------
(In thousands)
<S> <C>
1995 $45,577
1996 46,405
1997 84,877
1998 79,961
1999 174
</TABLE>
On February 28, 1995 the Company entered into a new long-term financing
agreement to replace the existing Credit Agreement and refinance the majority
of its long-term debt. The new agreement provides the Company with an unsecured
$350 million revolving credit facility to replace its current senior credit
facility. The new credit facility has a five year maturity with an extension
option and interest rates comparable to its current senior credit facility. The
new agreement also provides the Company with reduced interest rates upon
achievement of certain financial performance targets. With the new credit
agreement in place, the Company can redeem the remaining $78.5 million of
subordinated debentures and intends to do so in 1995. In anticipation of the
redemption, the Company intends to record an extraordinary charge of $3.4
million in the first quarter of 1995, to write-off unamortized debt issuance
costs and anticipated premiums.
Foreign subsidiaries had unused credit lines at December 31, 1994 of $24.7
million, to the extent that borrowings under these credit lines would not cause
the subsidiaries to exceed any of various restrictive covenants. These credit
lines are in various currencies and bear interest at rates that range from 7.0%
to 7.95% at December 31, 1994.
F-15
<PAGE> 54
Short-term obligations consist of the following:
<TABLE>
<CAPTION>
December 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Foreign subsidiary credit lines $3,120 $6,454
Other - 1,399
------ ------
$3,120 $7,853
====== ======
</TABLE>
NOTE J - INCOME TAXES
The Company is included in the consolidated federal income tax return of NACCO.
The Company and NACCO are parties to an income tax sharing agreement providing
for the allocation of federal income tax liabilities. Under this arrangement,
the Company will pay to NACCO an amount equal to the income taxes that would be
payable by the Company if it were a corporation filing a separate return.
Therefore, the currently payable federal portion of the provision for income
taxes is payable to NACCO. The Company files separate state income tax returns.
Components of income (loss) before income taxes and extraordinary charge are as
follows:
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------
1994 1993 1992
---- ---- ----
(In thousands)
<S> <C> <C> <C>
Domestic $17,694 $(6,101) $(29,384)
International 18,122 4,409 33,855
------ -------- -------
$35,816 $(1,692) $ 4,471
======= ======== ========
</TABLE>
Domestic income (loss) before income taxes includes expenses related to
interest on acquisition indebtedness, goodwill and deferred financing fee
amortization of approximately $40.4, $47.6 and $51.7 million in 1994, 1993 and
1992, respectively.
Income taxes consist of the following:
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------
1994 1993 1992
---- ---- ----
(In thousands)
<S> <C> <C> <C>
Currently Payable (Refundable):
Federal $9,808 $8,896 $(4,520)
State 2,212 1,187 204
Foreign 6,460 3,342 5,831
----- ----- -----
18,480 13,425 1,515
------ ------ -------
Deferred:
Federal 2,487 (4,446) 796
State (560) (1,166) (204)
Foreign (3,330) (4,385) 1,053
------- ------- -----
(1,403) (9,997) 1,645
------- ------- ------
$17,077 $3,428 $ 3,160
======= ====== ======
</TABLE>
F-16
<PAGE> 55
The Company has provided for estimated United States and foreign income taxes,
less available tax credits and deductions, which would be incurred on the
remittance of undistributed earnings in its foreign subsidiaries in excess of
earnings deemed to be indefinitely reinvested. It is management's intent to
provide income taxes on all future accumulations of undistributed earnings for
those foreign subsidiaries where it is anticipated that distribution of
earnings is likely to occur.
Accumulated earnings at December 31, 1994 of international subsidiaries which
have been indefinitely reinvested totaled $39.0 million. Determination of the
amount of unrecognized deferred tax liability on these unremitted earnings is
not practicable. The amount of withholding taxes that would be payable upon
remittance of all undistributed foreign earnings would be $5.0 million. These
withholding taxes, subject to certain limitations, may be used to reduce U.S.
income taxes.
A reconciliation of the provisions for income taxes at the federal statutory
income tax rate to income taxes as reported is as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------
1994 1993 1992
---- ---- ----
(In thousands)
<S> <C> <C> <C> <C>
Statutory rate 35% 35% 34%
Tax at statutory rate $12,536 $(592) $ 1,520
Effect of:
Foreign earnings subject to
varying tax rates - (215) (3,855)
Amortization of excess purchase
price 4,085 3,795 3,688
State income taxes 1,038 84 409
Loss (earnings) recorded net of tax (373) 1,054 (131)
Change in tax rate - 232 -
Other differences (209) (930) 1,529
------- -------- -------
Tax Provision $17,077 $3,428 $3,160
======= ====== ======
</TABLE>
A summary of the components of the net deferred tax balance in the Company's
consolidated balance sheets resulting from differences in the book and tax
basis of assets and liabilities follows:
<TABLE>
<CAPTION>
Deferred Tax Asset (Liability) At December 31, 1994
-----------------------------------------------------
(In thousands)
Current Non-Current
-----------------------------------------------------
<S> <C> <C> <C> <C>
Domestic Foreign Domestic Foreign
-------- ------- --------- -------
Inventories $(18,555) $593 $ - $ -
Accrued expenses and reserves 8,922 4,858 - -
Pension - - 563 (2,575)
Net operating loss carry forwards 1,144 820 - -
Product liability 3,120 - 13,722 -
Tax credit carry forwards 2,334 - - -
Unrepatriated earnings - - (8,904) -
Depreciation - - (13,454) (5,449)
Other (999) (1,079) (2,701) 42
------- ------- -------- -------
$(4,034) $ 5,192 $(10,774) $(7,982)
======= ======= ======== =======
</TABLE>
F-17
<PAGE> 56
<TABLE>
<CAPTION>
Deferred Tax Asset (Liability) At December 31, 1993
---------------------------------------------------------
Current Non-Current
---------------------------------------------------------
Domestic Foreign Domestic Foreign
-------- ------- --------- -------
<S> <C> <C> <C> <C>
Inventories $(21,645) $714 $ - $ -
Accrued expenses and reserves 8,656 218 3,282 -
Pension - - 386 (2,305)
Net operating loss carry forwards 1,076 6,121 - -
Product liability 3,040 - 12,563 -
Tax credit carry forwards 6,048 - - -
Unrepatriated earnings - - (4,881) -
Depreciation - - (15,706) (5,413)
Other 442 (414) (2,051) (55)
------- ------ ------- --------
$(2,383) $6,639 $(6,407) $(7,773)
======= ====== ======= =======
</TABLE>
NOTE K - POSTRETIREMENT BENEFITS
The Company maintains a variety of postretirement plans covering a majority of
its employees. A portion of the employees are participants in the defined
benefit plans discussed below. Most of the remaining covered employees
participate in the profit sharing portion of the Company's defined contribution
plan also described below. In addition, all eligible employees are included in
the 401(k) portion of the defined contribution plan. Total postretirement
expense for the Company was $8.5, $7.0 and $6.8 million for the years 1994,
1993 and 1992, respectively. Included in these amounts is the expense
associated with government sponsored plans in which the Company's international
subsidiaries participate. Cash contributions under the above plans were $7.2
million in 1994 and $7.1 million in 1993.
Each defined benefit plan has a formula which is used to determine benefits
upon retirement. Most formulas take into account age, compensation, and success
of the Company in meeting certain goals although certain hourly employee's
formulas are based primarily on years of service. The Company's current funding
policy is to contribute annually the minimum contribution calculated by the
independent actuaries. Contributions are intended to provide not only for
benefits attributed to service to date but also for those expected to be earned
in the future.
F-18
<PAGE> 57
The components of periodic pension cost and actuarial assumptions for the
Company's principal defined benefit plans for the years ended December 31,
1994, 1993 and 1992 are as follows:
<TABLE>
<CAPTION>
UNITED STATES PLANS
-------------------
Year Ended December 31,
-----------------------
1994 1993 1992
---- ---- ----
(In thousands)
<S> <C> <C> <C>
Interest accrued on projected
benefit obligation $2,504 $2,206 $ 2,001
Service cost-benefits earned
during the year 1,558 1,427 1,433
Actual return on plan assets,
net of plan expense 239 (2,083) (423)
Net amortization and deferral (1,568) 1,056 (481)
------ ----- ------
Net periodic pension cost $2,733 $2,606 $2,530
====== ====== ======
Assumed discount rate 8.50% 7.5% 8.25%
Rate of compensation increase
(where applicable) 5.5% 5.0% 5.75%
Expected long-term rate of return
on plan assets 9.0% 9.0% 9.0%
</TABLE>
<TABLE>
UNITED KINGDOM PLANS
--------------------
<CAPTION>
Year Ended December 31,
-----------------------
1994 1993 1992
---- ---- ----
(In thousands)
<S> <C> <C> <C>
Interest accrued on projected
benefit obligation $1,830 $2,138 $2,854
Service cost-benefits earned
during the year 1,356 1,403 1,794
Actual return on plan assets,
net of plan expense (185) (2,460) 2,808
Net amortization and deferral (2,743) (220) (6,111)
------- ------- ------
Net periodic pension cost $ 258 $ 861 $1,345
======= ======= ======
Assumed discount rate 8.0% 8.0% 9.5%
Rate of compensation increase
(where applicable) 5.0% 5.0% 6.5%
Expected long-term rate of return
on plan assets 9.5% 8.0% 9.5%
</TABLE>
F-19
<PAGE> 58
The following schedule reconciles the funded status of the Company's principal
defined benefit plans with amounts reported in the consolidated balance sheets
at December 31, 1994 and 1993:
<TABLE>
<CAPTION>
December 31,
------------
1994 1993
---- ----
United United United United
States Kingdom States Kingdom
Plans Plans Plans Plans
----- ----- ----- -----
<S> <C> <C> <C> <C>
Projected benefit obligation, based on (In thousands)
employment service to date and current
salary levels:
Vested accumulated benefit obligation $24,218 $22,991 $24,340 $21,860
Nonvested accumulated benefit obligation 2,023 195 2,020 177
------- ------- ------- -------
Total accumulated benefit obligation 26,241 23,186 26,360 22,037
Additional amounts related to projected
salary increase 5,429 2,438 4,966 2,223
------- ------- ------- -------
Total projected benefit obligation 31,670 25,624 31,326 24,260
Fair value of plan assets at December 31 22,922 29,352 20,994 28,811
======= ======= ======= =======
Plan assets in excess of (less than)
projected benefit obligation (8,748) 3,728 (10,332) 4,551
Unrecognized net loss from past
experience different from that assumed 4,507 1,583 6,182 1,040
Unrecognized prior service cost 3,076 1,359 2,455 1,291
Unrecognized net transition obligation - (578) - (614)
Additional minimum liability (3,975) - (3,670) -
------- ------- ------- -------
Prepaid (accrued) pension cost recognized $(5,140) $6,092 $(5,365) $6,268
======= ======= ======= =======
</TABLE>
The Company maintains a defined contribution retirement plan for U.S. employees
which includes a profit sharing portion and a 401(k) portion. Contributions to
the profit sharing plan are based on a formula which takes into account age,
compensation, and success of the Company in meeting certain goals.
Contributions vest over a five-year period. Under the 401(k) portion, eligible
employees may contribute up to 17% of their compensation and the Company
matches an amount equal to 66-2/3% of the participants' initial 3% before tax
contribution. Participants are at all times fully vested in their contributions
and those made by the Company.
F-20
<PAGE> 59
NOTE L - OTHER POSTRETIREMENT AND POSTEMPLOYMENT BENEFITS
The Company maintains health care and life insurance plans which provide
benefits to eligible retired employees. The Company funds these benefits on a
"pay as you go" basis, with the retirees paying a portion of the costs.
Summary information on the Company's plans is as follows:
<TABLE>
<CAPTION>
December 31,
------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Accumulated postretirement benefit obligation:
Retirees $3,866 $5,783
Fully eligible active plan participants 214 185
Other active plan participants 5,422 5,853
----- ------
9,502 11,821
Unrecognized net loss (1,648) (3,404)
------ ------
Accrued postretirement benefit $7,854 $8,417
====== ======
</TABLE>
The components of net periodic other postretirement benefit cost are as
follows:
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------
1994 1993
---- ----
(In thousands)
<S> <C> <C>
Service cost of benefits earned $187 $186
Interest cost on accumulated postretirement benefit
obligation 800 975
Amortization of unrecognized loss 197 204
------ ------
$1,184 $1,365
====== ======
</TABLE>
The assumed health care cost trend rate for measuring the postretirement
benefit obligation was 10% in 1994 and 11% in 1993, gradually reducing to 5.25%
in years 2003 and after. The weighted average discount rate utilized was 8.5%
in 1994 and 7.5% in the 1993 valuation. If the assumed health care trend rate
were increased by 1%, the effect on the APBO and expense would be immaterial.
Effective January 1, 1994 the Company adopted Statement of Financial Accounting
Standards No. 112, "Employers' Accounting for Postemployment Benefits" which
requires, among other things, that the expected cost of postemployment benefits
be recognized when they are earned or become payable (accrual method) when
certain conditions are met rather than the old method which recognized these
costs when they were paid (pay as you go). The adoption of this new standard
did not materially impact the Company's financial condition or results of
operations.
F-21
<PAGE> 60
NOTE M - LONG-TERM INCENTIVE COMPENSATION PLAN
The Company has a Long-Term Incentive Compensation Plan for officers and key
management employees of the Company and its subsidiaries. Awards under this
plan represent book value appreciation units and entitle the recipient, subject
to vesting and other restrictions, to receive cash equal to the difference
between the base period price for the units and the book value price as of the
quarter date coincident or immediately preceding the date of disbursement.
Awards vest and are payable ten years from date of grant or earlier under
certain conditions. As of December 31, 1994, 1,800,000 units have been awarded
to key employees and officers. The amount charged (credited) to expense was
$1.7, $(0.2) and ($1.0) million in 1994, 1993 and 1992, respectively. The total
amount accrued at December 31, 1994 and 1993 for these awards was $2.0 and $0.3
million, respectively, and was recorded as a long-term liability.
NOTE N - FINANCIAL INSTRUMENTS AND DERIVATIVE FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS -
A financial instrument is cash or a contract that imposes, or conveys, a
contractual obligation, or right, to deliver, or receive, cash or another
financial instrument. The fair value of financial instruments, except for the
Company's 12 3/8% subordinated debentures, approximated their carrying values
at December 31, 1994. The fair value of the subordinated debentures was $82.5
million at December 31, 1994 compared with their carrying value of $78.5
million.
INTEREST RATE DERIVATIVES -
The Company has entered into interest rate swap agreements. The use of these
agreements allows the Company to enter into long-term credit arrangements that
have performance based, floating rates of interest and then swap them into
fixed rates as opposed to entering into higher cost fixed-rate credit
arrangements. These agreements are with major commercial banks; therefore, the
risk of credit loss from nonperformance by the banks is minimal. As of December
31, 1994 the Company had $185 million notional principal amount of interest
rate swaps with an average effective fixed rate of 5.3%, although $60 million
of the swaps are delayed to start in 1995.
FOREIGN CURRENCY DERIVATIVES -
The Company enters into forward foreign exchange contracts for purposes of
hedging exposure to foreign currency exchange rate fluctuations. These
contracts are with major financial institutions, therefore, the risk of credit
loss from nonperformance by these institutions is minimal. These contracts
hedge primarily firm commitments and, to a lesser degree, anticipated
commitments relating to cash flows associated with sales and purchases
denominated in foreign currencies. The Company enters into foreign exchange
contracts in a variety of foreign currencies with maturities not exceeding one
year. At December 31, 1994 the Company had $190.9 million contract value of
forward foreign exchange contracts and had deferred losses of $0.5 million in
accordance with the Company's accounting policy.
F-22
<PAGE> 61
NOTE O - COMMITMENTS
Future minimum lease payments on office space, automobiles and office equipment
as of December 31, 1994 are as follows:
<TABLE>
<CAPTION>
Operating
Leases
----------
(In thousands)
<S> <C>
1995 $4,404
1996 3,981
1997 3,500
1998 3,080
1999 2,931
Subsequent to 1999 4,010
-------
Total Future Minimum Lease Payments $ 21,906
=======
</TABLE>
Aggregate rental expense for operating leases included in the consolidated
statements of income was $4.0, $4.2 and $3.4 million in 1994, 1993 and 1992,
respectively.
NOTE P - CONTINGENCIES
The Company is subject to recourse or repurchase obligations under various
financing arrangements for certain independently-owned retail dealerships.
Also, certain dealer loans are guaranteed by the Company. Total amounts subject
to recourse, guarantee or repurchase obligation at December 31, 1994 were $91.0
million.
When the Company is the guarantor of the principal amount financed, a security
interest is usually maintained in assets of parties for whom the Company is
guaranteeing debt. Losses anticipated under the terms of the recourse or
repurchase obligations have been provided for and are not significant.
The Company is the defendant in various product liability and other legal
proceedings incidental to its business. The majority of this litigation
involves product liability claims. The Company has recorded a reserve for
potential product liability losses at December 31, 1994 of $43.2 million, of
which $8.0 million is estimated to be payable in 1995. While the resolution of
litigation cannot be predicted with certainty, management believes that the
reserves are adequate and no material adverse effect upon the financial
position or results of operations of the Company will result from such legal
actions.
NOTE Q - SEGMENT INFORMATION
The Company's business consists of the engineering, manufacturing and marketing
of materials handling machinery and equipment, under the Hyster and Yale trade
names. The Company's products are manufactured in plants at five locations in
the United States and six international plants located in Scotland, Northern
Ireland, The Netherlands, Brazil, Australia and Japan. Service parts are
distributed through parts depots located in the United States, Europe,
Australia and Brazil. Generally, product assembled abroad is comprised of parts
and components manufactured or purchased locally and from U.S. plants at
established transfer prices. The transfer price of production parts and
completed units is established by a procedure designed to equate to an
arm's-length price. However, for purposes of the following financial statement
disclosure, transfers between geographic areas are presented at standard cost.
F-23
<PAGE> 62
<TABLE>
<CAPTION>
North Asia
1994 America Europe Pacific Elims Consolidated
-------- -------- ------- --------- ------------
(In thousands)
<S> <C> <C> <C> <C> <C>
Sales to unaffiliated customers $828,145 $289,692 $61,045 $ - $1,178,882
-------- -------- ------- --------- ----------
Transfers between
geographic areas 49,208 130,595 - (179,803) -
Total net sales $877,353 $420,287 $61,045 $(179,803) $1,178,882
======== ======== ======= ========= ==========
Operating profit $45,577 $15,073 $5,167 $65,817
======= ======= ====== =======
Other income (expense)
Income before income taxes (30,001)
and extraordinary charge --------
$35,816
=======
Identifiable assets $583,036 $309,578 $24,026 $(10,391) $906,249
======== ======== ======= ======== ========
<CAPTION>
North Asia
1993 America Europe Pacific Elims Consolidated
-------- -------- ------- --------- ------------
(In thousands)
Sales to unaffiliated customers $645,394 $220,437 $42,345 $ - $908,176
Transfers between
geographic areas 31,507 81,179 - (112,686) -
-------- -------- ------- --------- --------
Total net sales $676,901 $301,616 $42,345 $(112,686) $908,176
======== ======== ======= ========= ========
Operating profit $40,262 $(2,414) $1,713 $39,561
======= ======== ====== =======
Other income (expense) (41,253)
-------
Loss before income taxes
and extraordinary charge $(1,692)
=======
Identifiable assets $572,068 $274,847 $19,581 $(33,461) $833,035
======== ======== ======= ========= ========
</TABLE>
F-24
<PAGE> 63
<TABLE>
<CAPTION>
North Asia
1992 America Europe Pacific Elims Consolidated
------- ------ ------- ----- ------------
(In thousands)
<S> <C> <C> <C> <C> <C>
Sales to unaffiliated customers $579,034 $251,508 $ 35,347 $ - $ 865,889
Transfers between
geographic areas 32,128 89,166 - (121,294) -
--------- -------- --------- --------- ---------
Total net sales $611,162 $340,674 $ 35,347 $(121,294) $ 865,889
========= ======== ========= ========= =========
Operating profit $14,954 $28,651 $ 691 $ 44,296
========= ======== ========= ========
Other income (expense) (39,825)
-------
Income before income taxes $4,471
======
Identifiable assets $546,674 $282,936 $18,311 $(1,511) $846,410
========= ======== ======= ======= ========
</TABLE>
In addition to product sourced from plants abroad, export sales from the United
States plants to unaffiliated customers were $75.0, $53.8, and $44.9 million in
1994, 1993 and 1992, respectively. Total sales into markets outside the United
States were $428.3, $311.5 and $326.1 million in 1994, 1993 and 1992,
respectively.
NOTE R - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
<TABLE>
1994
<CAPTION>
First Second Third Fourth
Quarter Quarter Quarter Quarter
------- ------- ------- -------
(In thousands)
<S> <C> <C> <C> <C>
Net Sales $245,328 $290,358 $289,739 $353,457
Gross Profit 50,530 59,800 57,067 64,110
Operating Profit 11,075 19,821 14,531 20,390
Net Income $862 $2,076 $3,542 $9,040
</TABLE>
<TABLE>
1993
<CAPTION>
First Second Third Fourth
Quarter Quarter Quarter Quarter
------- ------- ------- -------
(In thousands)
<S> <C> <C> <C> <C>
Net Sales $214,680 $228,684 $217,516 $247,296
Gross Profit 44,973 46,260 40,943 51,886
Operating Profit 9,551 7,958 6,032 16,020
Net Income (Loss) $ (771) $ (3,529) $ (7,320) $ 3,208
</TABLE>
F-25
<PAGE> 64
<TABLE>
SCHEDULE II
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
(IN THOUSANDS)
<CAPTION>
------------------------------------------------------------------------------------------------------------
Col. A Col. B Col. C Col. D Col. E
------------------------------------------------------------------------------------------------------------
Additions
---------------------------
(1) (2)
Balance at Charged to Charged to Balance
Beginning Costs and Other Accts. Deductions at End
Description of Period Expenses Describe Describe of Period
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1994
Reserves deducted from asset
accounts:
Allowance for doubtful
accounts $4,922 $1,019 $39 b ($2,715) a $3,265
1993
Reserves deducted from asset
accounts:
Allowance for doubtful
accounts $4,292 $1,191 ($32) b ($529) a $4,922
1992
Reserves deducted from asset
accounts:
Allowance for doubtful
accounts $4,550 $430 ($61) b ($627) a $4,292
<FN>
a-Accounts receivable balances written off, net of recoveries
b-Foreign currency translation adjustment
</TABLE>
F-26
<PAGE> 65
EXHIBIT INDEX
<TABLE>
<S> <C>
(3) Articles of Incorporation and Bylaws.
(i) Certificate of Incorporation of the Company is incorporated herein by reference to
Exhibit 3.1 of the Company's Registration Statement on Form S-1 filed May 17, 1989
(Registration Statement 33-28812).
(ii) Bylaws of the Company are incorporated herein by reference to Exhibit 3.2 of the
Company's Registration Statement on Form S-1 filed May 17, 1989 (Registration
Statement No. 33-28812).
(iii) Certificate of Amendment to Certificate of Incorporation of the Company, dated
May 24, 1989, is incorporated herein by reference to Exhibit 3.3 to Amendment No. 1
filed June 9, 1989 to the Company's Registration Statement on Form S-1 (Registration
Statement No. 33-28812).
(iv) Certificate of Amendment to Certificate of Incorporation of the Company, dated June
7, 1989, is incorporated herein by reference to Exhibit 3.4 to Amendment No. 1 filed
June 9, 1989 to the Company's Registration Statement on Form S-1 (Registration
Statement No. 33-28812).
(4) Instruments defining the rights of security holders, including indentures.
(i) The Company by this filing agrees, upon request, to file with the Securities and
Exchange Commission the instruments defining the rights of holders of long-term debt
of the Company and its subsidiaries where the total amount of securities authorized
thereunder does not exceed 10% of the total assets of the Company and its
subsidiaries on a consolidated basis.
(ii) Indenture, dated as of August 3, 1989, between the Company and United Trust Company
of New York, Trustee, with respect to the 12-3/8% Senior Subordinated Debentures due
August 1, 1999 is incorporated herein by reference to Exhibit 4(ii) to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1989, Commission
File Number 33-28812.
(10) Material Contracts.
(i) Intentionally omitted.
(ii) Operating Agreement, dated as of July 31, 1979, by and between Eaton Corporation and
Sumitomo Heavy Industries Ltd. is incorporated herein by reference to Exhibit 10.4 of
the Company's Registration Statement on Form S-1 filed May 17, 1989 (Registration
Statement No. 33-28812).
</TABLE>
X-1
<PAGE> 66
<TABLE>
<S> <C> <C>
(iii) Memorandum Agreement, dated as of November 19, 1982, by and between Eaton
Corporation, Eaton International, Inc., Sumitomo Heavy Industries, Ltd. and Sumitomo
Yale Company Ltd. is incorporated herein by reference to Exhibit 10.5 of the
Company's Registration Statement on Form S-1 filed May 17, 1989 (Registration
Statement No. 33-28812).
(iv) Litigation Agreement, dated as of December 31, 1983, between Eaton Corporation and
Yale, as amended, is incorporated herein by reference to Exhibit 10.6 to Amendment
No. 1 filed June 9, 1989 to the Company's Registration Statement on Form S-1
(Registration Statement No. 33-28812).
(v) Third Amended and Restated Operating Agreement, dated as of November 21, 1985, as
amended, between Hyster Company and Hyster Credit Corporation is incorporated herein
by reference to Exhibit 10.7 to Amendment No. 1 filed June 9, 1989 to the Company's
Registration Statement on Form S-1 (Registration Statement No. 33-28812).
(vi) Master Sale Leaseback Agreement, dated as of December 19, 1985, between Hyster Credit
Corporation and Hyster is incorporated herein by reference to Exhibit 10.8 to
Amendment No. 1 filed June 9, 1989 to the Company's Registration Statement on Form
S-1 (Registration Statement No. 33-28812).
(vii) Existing Fleet Sale Leaseback Agreement, dated as of December 19, 1985, between
Hyster Credit Corporation and Hyster is incorporated herein by reference to Exhibit
10.9 to Amendment No. 1 filed June 9, 1989 to the Company's Registration Statement on
Form S-1 (Registration Statement No. 33-28812).
(viii) Intentionally omitted.
through (x)
(xi) Lease Agreement between the Industrial Development Board of the Town of Sulligent and
Hyster, dated as of June 1, 1970, is incorporated herein by reference to Exhibit
10.13 to Amendment No. 1 filed June 9, 1989 to the Company's Registration Statement
on Form S-1 (Registration Statement No. 33-28812).
(xii) Intentionally omitted.
* (xiii) Hyster-Yale Materials Handling, Inc. Long-Term Incentive Compensation Plan, dated as
of January 1, 1990, is incorporated herein to Exhibit 10(lxxxix) of the NACCO Annual
Report on Form 10-K for the fiscal year ended December 31, 1990, Commission File
Number 1-9172.
* (xiv) Hyster-Yale Materials Handling, Inc. Annual Incentive Compensation Plan, dated as of
January 1, 1990, is incorporated herein to Exhibit 10(lxxxviii) of the NACCO Annual
Report on Form 10-K for the fiscal year ended December 31, 1990, Commission File
Number 1-9172.
</TABLE>
X-2
<PAGE> 67
<TABLE>
<S> <C>
(xv) Termination and Release Agreement, dated as of May 26, 1989, among Eaton Corporation,
Eaton Credit Corporation and Eaton Leasing Corporation and Yale is incorporated
herein by reference to Exhibit 10.16 to Amendment No. 1 filed June 9, 1989 to the
Company's Registration Statement on Form S-1 (Registration Statement No. 33-28812).
(xvi) Intentionally omitted.
through (xxxviii)
(xxxix) Agreement and Plan of Merger, dated as of April 7, 1989, among NACCO Industries,
Inc., Yale Materials Handling Corporation, Acquisition I, ESCO Corporation, Hyster
Company and Newesco, is incorporated herein by reference to Exhibit 2.1 to the
Company's Registration Statement on Form S-1 filed May 17, 1989 (Registration
Statement Number 33-28812).
(xl) Agreement and Plan of Merger, dated as of April 7, 1989, among NACCO Industries,
Inc., Yale Materials Handling Corporation, Acquisition I, ESCO Corporation, Hyster
Company and Newesco, is incorporated herein by reference to Exhibit 2.2 to the
Company's Registration Statement on Form S-1 filed May 17, 1989 (Registration
Statement Number 33-28812).
(xli) Intentionally omitted.
through (xlvii)
(xlviii) Amendment to the Third Amended and Restated Operating Agreement, dated as of January
31, 1990, between Hyster and PacifiCorp Credit, Inc. is incorporated herein by
reference to Exhibit 10(xlvi) to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1990, Commission File Number 33-28812.
(xlix) Amendment to the Third Amended and Restated Operating Agreement, dated as of
January 31, 1990, between Hyster and AT&T Commercial Finance Corporation is
incorporated herein by reference to Exhibit 10(xlvii) to the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 1990, Commission File Number
33-28812.
(l) Amendment to the Third Amended and Restated Operating Agreement, dated as of
November 7, 1991, between Hyster and AT&T Commercial Finance Corporation is
incorporated herein by reference to Exhibit 10(l) to the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1991, Commission File Number 33-
28812.
(li) Intentionally omitted.
through (lvii)
(lviii) Marketing Agreement, dated as of January 1, 1992, by and between Yale Materials
Handling Corporation and Jungheinrich Aktiengellschaft (AG) is incorporated herein by
reference to Exhibit 10(lviii) to the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1991, Commission
</TABLE>
X-3
<PAGE> 68
<TABLE>
<S> <C>
File Number 33-28812.
(lix) Intentionally omitted.
through (lxi)
* (lxii) The Hyster-Yale Profit Sharing Plan, amended and restated as of November 11, 1992, is
incorporated herein by reference to Exhibit 10(lxii) to the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 1992, Commission File Number 33-
28812.
(lxiii) Intentionally omitted.
through (lxiv)
* (lxv) The Hyster-Yale Cash Balance Plan, as amended and restated, effective as of April 1,
1992, is incorporated herein by reference to Exhibit 10(lxv) to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1992, Commission File
Number 33-28812.
* (lxvi) Master Trust Agreement dated as of October 1, 1992, is incorporated herein by
reference from Exhibit 10(cv) of NACCO's Annual Report on Form 10-K for the fiscal
year ended December 31, 1992, Commission File Number 1-9172.
(lxvii) Intentionally omitted.
through (lxx)
* (lxxi) The Yale Materials Handling Corporation Deferred Incentive Compensation Plan, dated
March 1, 1984, also known as the Yale Materials Handling Corporation Short-Term
Incentive Deferral 1992, is incorporated herein by reference to Exhibit 10(lxxi) to
the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992,
Commission File Number 33-28812.
(lxxii) Intentionally omitted.
through (lxxvii)
(lxxviii) Agreement and Plan of Merger dated as of December 20, 1993 between Hyster Company, an
Oregon corporation, and Hyster Company, a Delaware corporation, is incorporated
herein by reference to Exhibit 10(lxxviii) to the Company's Annual Report on Form 10K
for the fiscal year ended December 31, 1993, commission File Number 33-28812.
(lxxix) Agreement and Plan of Merger dated as of December 20, 1993 between Yale Materials
Handling Corporation, a Delaware corporation, Hyster Company, a Delaware corporation,
and Hyster-Yale Materials Handling, Inc., a Delaware corporation, is incorporated
herein by reference to Exhibit 10(lxxix) to the Company's Annual Report on Form 10K
for the fiscal year ended December 31, 1993, commission File Number 33-28812.
(lxxx) Intentionally omitted.
through (lxxxiii)
</TABLE>
X-4
<PAGE> 69
<TABLE>
<S> <C> <C>
* (lxxxiv) Amendment No. 1 dated as of May 13, 1993 to the Hyster-Yale Profit Sharing Plan is
incorporated herein by reference to Exhibit 10(lxxxiv) to the Company's Annual Report
on Form 10K for the fiscal year ended December 31, 1993, Commission File Number 33-
28812.
* (lxxxv) Amendment No. 2 dated effective January 1, 1994 to the Hyster-Yale Profit Sharing
Plan is incorporated herein by reference to Exhibit 10(lxxxv) to the Company's Annual
Report on Form 10K for the fiscal year ended December 31, 1993, Commission File
Number 33-28812.
* (lxxxvi) Amendment No. 1 dated as of May 27, 1993 to the Hyster-Yale Cash Balance Plan is
incorporated herein by reference to Exhibit 10(lxxxvi) to the Company's Annual Report
on Form 10K for the fiscal year ended December 31, 1993, Commission File Number 33-
28812.
* (lxxxvii) Amendment No. 2 dated effective January 1, 1994 to the Hyster-Yale Cash Balance Plan
is incorporated herein by reference to Exhibit 10(lxxxvii) to the Company's Annual
Report on Form 10K for the fiscal year ended December 31, 1993, Commission File
Number 33-28812.
* (lxxxviii) Amendment No. 1 effective as of May 12, 1993 to the Hyster-Yale Long-Term Incentive
Compensation Plan is incorporated herein by reference to Exhibit 10(lxxxviii) to the
Company's Annual Report on Form 10K for the fiscal year ended December 31, 1993,
Commission File Number 33-28812.
(lxxxix) Intentionally omitted.
* (xc) Amendment No. 1 effective as of December 31, 1993 to the Hyster-Yale Annual Incentive
Compensation Plan incorporated herein by reference to Exhibit 10(lxxxx) to the
Company's Annual Report on Form 10K for the fiscal year ended December 31, 1993,
Commission File Number 33-28812.
(xci) Intentionally omitted.
* (xcii) Master Trust Agreement for Defined Benefit Plans between NACCO Industries, Inc. and
State Street Bank and Trust Company dated January 1, 1994 is incorporated herein by
reference to Exhibit 10(cxxxviii) to NACCO Industries, Inc. report on Form 10-K for
the year ended December 31, 1993, Commission File Number 1-9172.
* (xciii) Amendment No. 2 effective as of December 31, 1993 to the Hyster-Yale Long-Term
Incentive Compensation Plan is incorporated herein by reference to Exhibit
10(lxxxxiii) to the Company's Annual Report on Form 10K for the fiscal year ended
December 31, 1993, Commission File Number 33-28812.
* (xciv) Amendment No. 2 to the Hyster-Yale Materials Handling, Inc. Annual Incentive
Compensation Plan effective January 1, 1994 is incorporated herein by reference to
Exhibit 10(lxxxxiv) to
</TABLE>
X-5
<PAGE> 70
<TABLE>
<S> <C>
the Company's Quarterly Report on Form 10Q for the quarter ended June 30, 1994,
Commission File Number 33-28812.
* (xcv) Amendment No. 3 to the Hyster-Yale Materials Handling, Inc. Long-Term Incentive
Compensation Plan effective January 1, 1994 is incorporated herein by reference to
Exhibit 10(lxxxxv) to the Company's Quarterly Report on Form 10Q for the quarter
ended June 30, 1994, Commission File Number 33-28812.
* (xcvi) Amendment No. 3 to the NACCO Materials Handling Group, Inc. Profit Sharing Plan
effective January 1, 1994 is incorporated herein by reference to Exhibit 10(lxxxxvi)
to the Company's Quarterly Report on Form 10Q for the quarter ended June 30, 1994,
Commission File Number 33-28812.
(xcvii) Intentionally omitted.
through (xcviii)
* (xcix) Amendment No. 1 to the Amended and Restated NACCO Materials Handling Group, Inc.
Unfunded Benefit Plan effective as of October 1, 1994 is incorporated herein by
reference to Exhibit 10(lxxxxix) to the Company's Quarterly Report on Form 10Q for
the quarter ending September 30, 1994, Commission File Number 33-28812.
(c) Amendment dated as of January 1, 1994 to the Third Amendment and Restated Operating
Agreement dated as of November 7, 1991, between NACCO Materials Handling Group, Inc.
and AT&T Commercial Finance Corporation is incorporated herein by reference to
Exhibit 10(c) to the Company's Quarterly Report on Form 10Q for the quarter ending
September 30, 1994, Commission File Number 33-28812.
* (ci) Amendment No. 4 to the NACCO Materials Handling Group, Inc. Profit Sharing Plan
effective on various dates is attached hereto as Exhibit 10(ci).
* (cii) Amendment No. 5 to the NACCO Materials Handling Group, Inc. Profit Sharing Plan
effective as of January 1, 1994 is attached hereto as Exhibit 10(cii).
* (ciii) Amendment No. 3 to the NACCO Materials Handling Group, Inc. Cash Balance Plan
effective December 31, 1994 is attached hereto on Exhibit 10(ciii).
* (civ) Instrument to Merge of the North American Coal Corporation Salaried Employees Pension
Plan; the Hamilton Beach/Proctor-Silex Profit Sharing Retirement Plan, the NACCO
Materials Handling Group, Inc. Cash Balance Plan for Salaried Employees, the NACCO
Materials Handling Group, Inc. Cash Balance Plan for Sulligent Shop Employees and the
NACCO Materials Handling Group, Inc. Cash Balance Plan for Berea Shop Employees
effective as of December 31, 1994 is incorporated herein by reference to Exhibit
10(xii) to NACCO Industries, Inc. Report on Form 10K for the year ended
</TABLE>
X-6
<PAGE> 71
<TABLE>
<S> <C>
December 31, 1994, Commission File No. 1-9172.
* (cv) The NACCO Materials Handling Group, Inc. Unfunded Benefit Plan (as Amended and
Restated effective October 1, 1994) is attached hereto as Exhibit 10(cv).
* (cvi) Instrument of Adoption and Merger of the NACCO Materials Handling Group, Inc.
Unfunded Benefit Plan as amended and restated effective October 1, 1994 is attached
hereto as Exhibit 10(cvi).
* (cvii) Amendment No. 2 to the Amended and Restated NACCO Materials Handling Group, Inc.
Unfunded Benefit Plan effective as of October 1, 1994 is attached hereto as Exhibit
10(cvii).
(cviii) Credit Agreement between NACCO Materials Handling Group, Inc. and Morgan Guaranty
Trust Company of New York, as agent, and the other banks listed thereto, dated
February 28, 1995, which is attached hereto as Exhibit 10(cviii).
(cvix) Letter Agreement between Hyster-Yale Materials Handling, Inc., NACCO Materials
Handling Group, Inc. and Citicorp North America, Inc. as Agent dated February 28,
1995 which is attached hereto as Exhibit 10(cvix).
* (cx) Amendment No. 2A to the NACCO Materials Handling Group Cash Balance Plan executed
March 15, 1995 which is attached hereto as Exhibit 10(cx).
* Management Contract or Compensation Plan or arrangement required to be filed as an exhibit pursuant to
Item 14(c) of this Annual Report on Form 10-K.
(21) Subsidiaries of the Registrant.
(i) The subsidiaries of the Company are attached hereto as Exhibit 21(i).
(24) Powers of Attorney
(i) A manually signed copy of a power of attorney for Owsley Brown II is attached hereto
as Exhibit 24(i).
(ii) A manually signed copy of a power of attorney for John J. Dwyer is attached hereto as
Exhibit 24(ii).
(iii) A manually signed copy of a power of attorney for Robert M. Gates is attached hereto
as Exhibit 24(iii).
(iv) A manually signed copy of a power of attorney for E. Bradley Jones is attached hereto
as Exhibit 24(iv).
(v) A manually signed copy of a power of attorney for Dennis W. LaBarre is attached
hereto as Exhibit 24(v).
(vi) A manually signed copy of a power of attorney for Yoshinori Ohno is attached hereto
as Exhibit 24(vi).
</TABLE>
X-7
<PAGE> 72
<TABLE>
<S> <C>
(vii) A manually signed copy of a power of attorney for Alfred M. Rankin is attached hereto
as Exhibit 24(vii).
(viii) A manually signed copy of a power of attorney for Claiborne R. Rankin is attached
hereto as Exhibit 24(viii).
(ix) A manually signed copy of a power of attorney for John C. Sawhill is attached hereto
as Exhibit 24(ix).
(x) A manually signed copy of a power of attorney for Britton T. Taplin is attached
hereto as Exhibit 24(x).
(xi) A manually signed copy of a power of attorney for David Taplin, is attached hereto as
Exhibit 24(xi).
(xii) A manually signed copy of a power of attorney for Frank E. Taplin, Jr. is attached
hereto as Exhibit 24(xii).
(xiii) A manually signed copy of a power of attorney for Richard B. Tullis is attached
hereto as Exhibit 24(xiii).
(27) Financial Data Schedule
</TABLE>
X-8
<PAGE> 1
Exhibit 10(ci)
AMENDMENT NO. 4
TO THE
NACCO MATERIALS HANDLING GROUP, INC. PROFIT SHARING PLAN
--------------------------------------------------------
NACCO Materials Handling Group, Inc. hereby adopts this
Amendment No. 4 to the NACCO Materials Handling Group, Inc. Profit Sharing
Plan (as amended and restated effective November 1, 1992) (the "Plan"). The
provisions of this Amendment shall be effective as of the dates specified
herein. Words and phrases used herein with initial capital letters which are
defined in the Plan are used herein as so defined.
Section 1
---------
The first paragraph of the Preamble to the Plan is hereby
amended (a) by adding the words "and Code Section 401(k) and 401(m) portion"
prior to the words "of the Yale Materials" in the second sentence thereof,
effective November 1, 1992, and (b) by adding the following sentences to the
end thereof, effective December 1, 1994:
"In addition, effective December 31, 1993, NACCO Industries,
Inc. adopted the profit sharing portion of the Plan for the
benefit of certain of its employees. Effective December 1,
1994, NACCO Industries, Inc. adopted the Code Section 401(k)
and 401(m) portion of the Plan for the benefit of certain of
its employees and the account balances of such NACCO
Industries, Inc. employees under the North American Coal
Corporation Retirement Savings Plan were transferred to the
Plan."
Section 2
---------
Effective December 1, 1994, Section 1.1(6) of the Plan is
hereby amended by adding the following sentence to the end thereof:
"Notwithstanding the foregoing, a Beneficiary
designation made by a NACCO Participant prior to November 30,
1994 under the North American Coal Corporation Retirement
Savings Plan, shall remain effective under this Plan until
changed in accordance with the procedures set forth in this
Subsection."
Section 3
---------
A new Section 1.1(29A) is hereby added to the Plan immediately
following Section 1.29 of the Plan, to read as follows:
"(29A) NACCO Contributions: Contributions made by
or for NACCO Participants under the North American Coal
Corporation Retirement Savings Plan that were subsequently
transferred to this Plan.
<PAGE> 2
Section 4
---------
A new Section 1.1(29B) is hereby added to the Plan immediately
following Section 1.29A of the Plan, to read as follows:
"(29B) NACCO Participant: A person who had a Code
Section 401(k) account balance under The North American Coal
Corporation Retirement Savings Plan as of November 30, 1994
that was transferred to the Plan effective December 1, 1994."
Section 5
---------
Effective December 1, 1994, Section 2.2 of the Plan is hereby
amended by adding a new Subsection (5) thereto, to read as follows:
"(5) Notwithstanding the foregoing, a NACCO
Participant shall become a Participant in this Plan on
December 1, 1994."
Section 6
---------
Effective December 1, 1994, Section 2.3 of the Plan, as
amended by Amendment No. 2 to the Plan, is hereby amended by deleting therefrom
the words "(other than a Covered Employee who is a salaried Employee of NACCO
Industries, Inc.)".
Section 7
---------
Effective December 1, 1994, Section 2.3 of the Plan is hereby
further amended by adding the following sentence to the end thereof:
"Notwithstanding the foregoing, any and all elections made by
NACCO Participants under the North American Coal Corporation
Retirement Savings Plan with regard to Participant
Contributions and investment directions or any other
authorizations similarly made by a NACCO Participant shall
remain effective under this Plan until changed in accordance
with the procedures described in Sections 3.4 and 5.5 of the
Plan, as applicable."
Section 8
---------
Effective December 1, 1994, Section 3.4 of the Plan is hereby
amended by adding the words ", or by a NACCO Participant pursuant to an
election or designation made under the North American Coal Corporation
Retirement Savings Plan" prior to the words "shall continue in effect,".
<PAGE> 3
Section 9
---------
Effective December 1, 1994, the first sentence of Section 3.7
of the Plan is hereby amended by adding the words "; provided, however, that
the amount of Employer Matching Contributions made for a NACCO Participant is
an amount equal to 50% of the first 5% of Before-Tax Contributions made for
such Participant" after the words "2% of each such Participant's Compensation".
Section 10
----------
Effective December 1, 1994, Section 3.8 of the Plan is hereby
amended by adding the words "; provided, however, that each NACCO Participant
shall be credited with a portion of the Employer Matching Contribution equal to
50% of the first 5% of Before-Tax Contributions" after the words "such payroll
period".
Section 11
----------
Effective as of November 1, 1992, Section 3.11(3) of the Plan
(related to certain additional Profit Sharing Contributions) is hereby deleted
in its entirety.
Section 12
----------
Effective December 1, 1994, Section 5.2 of the Plan is hereby
amended to add the following words "and (8) NACCO Contributions" after the
words "(7) Rollover Contributions".
Section 13
----------
Effective December 1, 1994, Section 5.5 of the Plan is hereby
amended to add Subsection (3) thereto, to read as follows:
"(3) Notwithstanding the foregoing Subsections of
this Section, any and all elections made under the North
American Coal Corporation Retirement Savings Plan by a NACCO
Participant with regard to investment directions will shall be
effective under this Plan until changed in accordance with the
provisions of this Section."
Section 14
----------
Effective December 1, 1994, Section 6.3 of the Plan is hereby
amended by adding a new Subsection (4) thereto, to read as follows:
"(4) Notwithstanding any other provisions of this
Article, distributions of NACCO Contributions under the Plan
shall be subject to the terms and conditions of Section 6.3 of
The North American Coal Corporation Retirement Savings Plan,
as such Section was in effect on November 30, 1994."
<PAGE> 4
Section 15
----------
Effective December 1, 1994, Section 6.8 of the Plan is hereby
amended by adding a new Subsection (6) thereto, to read as follows:
"(6) Notwithstanding any other provision of this
Plan, withdrawals from a NACCO Contributions Sub-Account by a
NACCO Participant shall be subject to the terms and conditions
of Section 6.6 of The North American Coal Corporation
Retirement Savings Plan, as such Section was in effect on
November 30, 1994."
Section 16
----------
Effective December 1, 1994, Section 6.9 of the Plan is hereby
amended (a) by adding the words "; provided, however, that this sentence is not
applicable to withdrawals made by NACCO Participants" after "Prior Employer
Stock Fund" at the end of the second sentence of Subsection (1) thereof, and
(b) by amending Subsection (2) thereof in its entirety, to read as follows:
"(2) Distributions and withdrawals shall be made in the form
of cash payments. Notwithstanding the foregoing,
distributions and withdrawals of the portion of a
Participant's Account invested in the Prior Employer Stock
Fund shall be made in whole shares of Eaton Corporation common
stock with the value of any fractional shares being
distributed in cash; provided, however that the second
sentence of this Subsection is not applicable to NACCO
Participants."
Section 17
----------
Effective December 1, 1994, Section 6.10 of the Plan is hereby
amended by adding a new Subsection (6) thereto, to read as follows:
"Notwithstanding any other provision of the Plan,
loans to NACCO Participants, outstanding as of November 30,
1994, shall continue to be subject to and construed under the
terms originally applicable to such loans."
Section 18
----------
Effective December 1, 1994, Section 14.1 of the Plan is
amended in its entirety to read as follows:
"14.1 Right to Amend. The Company has reserved, and does
hereby reserve, the right to amend at any time and from time to time, by action
of the Nominating, Organization and Compensation Committee of the Board of
Directors, any or all of the provisions of the Plan (including any Instrument
of Adoption), without the consent of any other Employer or any Employee,
Participant or Beneficiary or other person. In addition, each other Employer
shall have the right to amend, at any time and from time to time, by action of
its Nominating,
<PAGE> 5
Organization and Compensation Committee of the Board of Directors, any or all of
the provisions of any Instrument of Adoption executed by it, with the consent of
the Company but without the consent of any other Employer or Employee,
Participant or Beneficiary or other person. The Trust Agreement may be amended
in the manner and to the extent provided therein."
Section 19
----------
Effective December 1, 1994, Section 14.2 of the Plan is
amended in its entirety to read as follows:
"14.2 Procedure. Any amendment of the Plan (1) shall be
expressed in an instrument executed by an officer of the Company or the
Employer, as applicable under Section 14.1, by action of the Nominating,
Organization and Compensation Committee of the Board of Directors and filed
with the Trustee, (2) shall become part of the Plan and (3) shall become
effective as of the date designated in such instrument. If no effective date
of an amendment is designated, such amendment shall become effective on the
date of the execution of the amendment."
Section 20
----------
Effective December 1, 1994, Section 15.1 of the Plan is
amended in its entirety to read as follows:
"15.1 Right to Terminate or Withdraw. (1) The Company has
reserved, and does hereby reserve, the right by action of the Nominating,
Organization and Compensation Committee of the Board of Directors to terminate
the Plan at any time, without the consent of any other Employer or any
Employee, Participant, Beneficiary or other person, either in whole or in part
as to any designated group of Employees (including former Employees) and their
Beneficiaries. Any such termination shall be expressed in an instrument
executed by an officer of the Company on the order of the Nominating,
Organization and Compensation Committee of the Board of Directors and filed
with the Trustee and shall (except as may otherwise be required by applicable
law) become effective as of the date designated in such instrument or, if no
effective date is so designated, on the date of the execution of such
instrument.
"(2) Any Employer other than the Company which adopts the
Plan may elect separately to withdraw from the Plan, either in whole or as to
any designated group of its Employees (including former Employees) and their
Beneficiaries. Such withdrawal shall be expressed in an instrument executed by
the withdrawing Employer on the order of its Nominating, Organization and
Compensation Committee of the Board of Directors and filed with the Company and
the Trustee and shall become effective as of the date designated in such
instrument or, if no such effective date is so designated in such instrument,
on the later of the date of the execution of the instrument or approval thereof
by the Company. No such withdrawal shall decrease the amount of Employer
Contributions to be made by the Employer on account of periods preceding the
withdrawal. The interests in the Trust Fund of Participants who are or were
Employees of the withdrawing Employer shall be distributed as provided in
Article VI."
<PAGE> 6
Section 21
----------
Effective as of November 1, 1992, Section 16.7 of the Plan is
hereby amended (a) to substitute the words "16.6(2) for the words "Section
14.6(a)" in Subsection (a) thereof, and (b) to substitute the words "Section
4.9(1)" for the words "Section 4.10(1)" in Subsection (b) thereof.
Executed this 30th day of November, 1994.
NACCO MATERIALS HANDLING GROUP, INC.
By: Charles A. Bittenbender
---------------------------------
Title: Assistant Secretary
----------------------
<PAGE> 1
Exhibit 10(cii)
AMENDMENT NO. 5
TO THE
NACCO MATERIALS HANDLING GROUP, INC.
PROFIT SHARING PLAN
-------------------
NACCO Materials Handling Group, Inc. hereby adopts this
Amendment No. 5 to the NACCO Materials Handling Group, Inc. Profit Sharing
Plan (as amended and restated effective November 1, 1992) (the "Plan"). The
provisions of this Amendment shall be 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
---------
Effective April 1, 1995, the second sentence of Section
1.1(12) of the Plan is hereby amended by deleting the phrase "temporary or
seasonal employees" therefrom.
Section 2
---------
Effective as of December 31, 1994, a new section 3.11A is
hereby added to the Plan, immediately following Section 3.11, to read as
follows:
"3.11A Additional Profit Sharing Contribution for 1994 Plan Year.
----------------------------------------------------------
(1) For the 1994 Plan Year, each Employer (other than NACCO
Industries, Inc.) shall make an additional Profit Sharing Contribution to the
Trust on behalf of each Profit Sharing Employee who is an Employee of such
Employer and who completed an Hour of Service during the 1994 Plan Year in an
amount equal to the sum of (a) and (b), where (a) is the eligible Profit
Sharing Employee's Compensation for the 1994 Plan Year multiplied by a
percentage factor and (b) is the eligible Profit Sharing Employee's
Compensation for the 1994 Plan Year which exceeds the Social Security Wage Base
for the 1994 Plan Year multiplied by a percentage factor, both of which are
determined according to the following schedule:
<TABLE>
<CAPTION>
Percentage of
Percentage of Compensation exceeding
Age Compensation Social Security Wage Base
--- ------------ -------------------------
<S> <C> <C>
0-34 .63% .63%
35-39 .72% .72%
40-44 .88% .88%
45-49 1.10% 1.10%
50-54 1.35% .97%
55-59 1.70% .71%
60+ 1.98% .45%
</TABLE>
(2) For the 1994 Plan Year, NACCO Industries, Inc. shall make an additional
Profit Sharing Contribution to the Trust on behalf of each Profit Sharing
Employee who is its Employee and who completed an Hour of Service
<PAGE> 2
during the 1994 Plan Year in an amount equal to the sum of (a) and (b), where
(a) is the eligible Profit Sharing Employee's Compensation for the 1994 Plan
Year multiplied by a percentage factor and (b) is the eligible Profit Sharing
Employee's Compensation for the 1994 Plan Year which exceeds the Social Security
Wage Base for the 1994 Plan Year multiplied by a percentage factor, both of
which are determined in accordance with the following schedule:
<TABLE>
<CAPTION>
Percentage of
Percentage of Compensation exceeding
Age Compensation Social Security Wage Base
--- ------------ -------------------------
<S> <C> <C>
0-34 2. 1431% 2 .02%
35-39 2. 4921% 2 .19%
40-44 2. 7949% 2 .15%
45-49 3. 3853% 1 .45%
50-54 4. 0371% .65%
55-59 4.81154% .0%
60+ 5. 5822% .0%
</TABLE>
Section 3
---------
Section 4.8(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), After-Tax Contributions (if any) 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
After-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 not subject to 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 After-Tax Contributions and 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 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 Matching Employer
Contributions shall be forfeited and applied to reduce future Employer
Contributions in the manner specified in Section 6.4(3). 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
<PAGE> 3
under this Plan shall be reduced first to the extent necessary to avoid
exceeding such limitations."
EXECUTED this 15th day of March, 1995.
---- -----
NACCO MATERIALS HANDLING GROUP, INC.
By: /s/ Charles Bittenbender
---------------------------------
Title: Assistant Secretary
<PAGE> 1
Exhibit 10(ciii)
AMENDMENT NO. 3
TO THE
NACCO MATERIALS HANDLING GROUP, INC.
CASH BALANCE PLAN
NACCO Materials Handling Group, Inc. hereby adopts this
Amendment No. 3 to the NACCO Materials Handling Group, Inc. Cash Balance Plan
which consists of the following three separate pension plans: (1) the NACCO
Materials Handling Group, Inc. Cash Balance Plan for Berea Shop Employees (the
"Berea Plan"), (2) the NACCO Materials Handling Group, Inc. Cash Balance Plan
for Sulligent Shop Employees (the "Sulligent Plan"), and (3) the NACCO
Materials Handling, Inc. Cash Balance Plan for Salaried Employees (the
"Salaried Plan") (collectively referred to herein as the "Plan"). The purpose
of this Amendment is (a) to merge the Berea Plan, the Sulligent Plan, the
Salaried Plan as well as the Hamilton Beach/Proctor-Silex, Inc. Profit Sharing
Retirement Plan (the "PSRP") into The North American Coal Corporation Salaried
Employees Pension Plan ("Plan 005"), effective December 31, 1994, and (b) to
amend certain other provisions of the Plan. After the merger, the merged plan
shall be known as the Combined Defined Benefit Plan for NACCO Industries, Inc.
and Its Subsidiaries (the "Combined Plan"). The provisions of this Amendment
shall be effective December 31, 1994, except as otherwise specified herein.
Words and phrases used herein with initial capital letters which are defined in
the Plan are used herein as so defined.
<PAGE> 2
Section 1
---------
The Preamble to the Plan is hereby amended by adding the
following new provision at the end thereof:
"Effective December 31, 1994, these three Plans, along with
the Hamilton Beach/Proctor-Silex, Inc. Profit Sharing Retirement Plan,
were merged into The North American Coal Corporation Salaried
Employees Pension Plan and the name of such merged plan was changed to
the Combined Defined Benefit Plan for NACCO Industries, Inc. and Its
Subsidiaries."
Section 2
---------
The Plan is hereby amended in its entirety by (a) adding the
words, "Part III of" prior to the words "the Plan" wherever they may appear
throughout the Plan, and (b) by adding the words "portion of Part III of the
Plan" after the words the "NACCO Materials Handling Group, Inc. Cash Balance
Plan for Berea Shop Employees", the "Berea Plan", the "NACCO Materials Handling
Group, Inc. Cash Balance Plan for Sulligent Shop Employees", the "Sulligent
Plan", the "NACCO Materials Handling Group, Inc. Cash Balance Plan for Salaried
Employees", or the "Salaried Plan" wherever those words may appear throughout
the Plan. In addition, all references to Sections of the Plan throughout the
Plan are hereby amended to refer to Sections of Part III of the Plan.
Section 3
---------
The first sentence of Article I is hereby amended by adding
the words "for construction of the provisions of Part III of the Plan" after
the words "meanings given below".
<PAGE> 3
Section 4
---------
Effective as of January 1, 1994, Section 1.29 of the Plan is
hereby amended by adding a new Subsection (d), as follows:
"(d) In lieu of the preceding provisions of this Section
1.29, the Company may elect one of the simplified methods
described in Section 414(q)(12) of the Code or Revenue
Procedure 93-42 to determine which Employees are Highly
Compensated Employees."
Section 5
---------
A new Section 1.46A is hereby added to the Plan, immediately
following Section 1.46, to read as follows:
"1.46A Part III of the Plan: The portion of the
Combined Plan that consists of the NACCO Materials Handling
Group, Inc. Cash Balance Plan which is comprised of three
separate portions: (i) the Berea Plan, (ii) the Sulligent
Plan, and (iii) the Salaried Plan, and any Exhibits or
Amendments thereto."
Section 6
---------
Section 1.52 of the Plan is hereby amended in its entirety and
the following substituted therefor:
"The pension plan known as the Combined Defined
Benefit Plan for NACCO Industries, Inc. and Its Subsidiaries,
as the same may be amended or restated from time to time."
Section 7
---------
Section 2.02(b)(1) of the Plan is hereby amended by deleting
the phrase "as amended and restated hereby that continues such Prior Plan".
<PAGE> 4
Section 8
---------
Section 2.02(b)(3) of the Plan is hereby amended by deleting
the phrase "that he was an Active Participant in prior to his Qualifying
Termination".
Section 9
---------
Section 3.02 of the Plan as amended by Amendment No. 2 thereto
is hereby further amended by deleting the words "Plan designated in Section
1.52(c)" and substituting therefor the words "the Salaried Plan portion of the
Combined Plan".
Section 10
----------
Sections 15.01 and 16.01(a) of the Plan are each hereby
amended by adding the phrase "its Board of Directors or" after the phrase "by
action of". In addition, Sections 15.02 and 16.01(a) of the Plan are each
hereby amended by adding the words "an officer of" after the words "executed
by".
Section 11
----------
Section 19.02(a) of the Plan is hereby amended by deleting the
words "constitute an amendment, restatement and continuation of each of the
three separate Plans described in Section 1.54 to".
Executed this 31st day of December, 1994.
---- --------
NACCO MATERIALS HANDLING
GROUP, INC.
By: Charles A. Bittenbender
---------------------------------
Title: Assistant Secretary
------------------------------
<PAGE> 1
THE NACCO NATERIALS HANDLING GROUP, INC.
UNFUNDED BENEFIT PLAN
(AS AMENDED AND RESTATED EFFECTIVE OCTOBER 1, 1994)
<PAGE> 2
NACCO MATERIALS HANDLING GROUP, INC.
UNFUNDED BENEFIT PLAN
NACCO Materials Handling Group, Inc. (successor to Hyster Company) (the
"Company") does hereby amend and completely restate the NACCO Materials
Handling Group, Inc. Unfunded Benefit Plan on the terms and conditions
described hereinafter, effective as of October 1, 1994:
ARTICLE I
PREFACE
-------
SECTION 1.1. EFFECTIVE DATE. The original effective date of this Plan was
February 10, 1993. The effective date of this amendment and restatement is
October 1, 1994.
SECTION 1.2. PURPOSE OF THE PLAN. The purpose of this Plan is to provide
for certain Employees of the Employers (a) benefits they would have received
under the Qualified Plans but for (1) the dollar limitation on Compensation
taken into account under the Qualified Plans as a result of Section 401(a) (17)
of the Code and (2) the limitations imposed under Section 415 of the Code, and
(b) an additional vehicle for deferring compensation.
SECTION 1.3. GOVERNING LAW. This Plan shall be regulated, construed and
administered under the laws of the State of Oregon, except when preempted by
federal law.
SECTION 1.4. GENDER AND NUMBER. For purposes of interpreting the
provisions of this Plan, the masculine gender shall be deemed to include the
feminine, the feminine gender shall be deemed to include the masculine, and the
singular shall
VOL402CL Doc: 154226.1
<PAGE> 3
3
include the plural unless otherwise clearly required by the context.
SECTION 1.5. CONSTRUCTION OF PLAN. The Plan provides benefits for
Employees who are Participants in two separate Qualified Plans. References
throughout this Plan to a "Qualified Plan" shall be deemed to refer to the
particular Qualified Plan in which the Participant participants.
ARTICLE II
DEFINITIONS
-----------
Except as otherwise provided in this Plan, terms defined in the Qualified
Plans as they may be amended from time to time shall have the same meanings
when used herein, unless a different meaning is clearly required by the context
of this Plan. In addition, the following words and phrases shall have the
following respective meanings for purposes of this Plan.
SECTION 2.1. ACCOUNT shall mean the record maintained in accordance with
Section 3.4 by the Employer as the sum of the Participant's Excess Profit
Sharing Sub-Account and Excess Deferral Sub-Account.
SECTION 2.2. 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 all other Participants) calculated for
the applicable time period, based on the following formula:
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.
VOL402CL Doc: 154226.1
<PAGE> 4
4
SECTION 2.3. BASE SALARY shall mean an Executive's base salary for the Plan
Year (including, for this purpose, any salary reductions caused as a result of
participation in (a) an Employer-sponsored plan which is governed by Section
401(k) or 125 of the Code or (b) this Plan).
SECTION 2.4. BENEFICIARY shall mean the person or persons designated by the
Participant as his Beneficiary under this Plan, in accordance with the
provisions of Article VII hereof.
SECTION 2.5. BONUS. An Executive's Bonus for a Plan Year is the annual
cash incentive bonus under the NACCO Material Handling Group, Inc. Annual
Incentive Compensation Plan which is earned with respect to services performed
by the Executive during such Plan Year, whether or not such Bonus is actually
paid to the Executive during such Plan Year. An election to defer a Bonus
under this Plan must be made before the period in which the services are
performed which give rise to such Bonus.
SECTION 2.6. CASH BALANCE EMPLOYEE shall mean a participant in the NACCO
Materials Handling Group, Inc. Cash Balance Plan for Salaried Employees (or any
successor plan).
SECTION 2.7. COMPANY shall mean NACCO Materials Handling Group, Inc. or any
entity that succeeds NACCO Materials Handling Group, Inc. by merger,
reorganization or otherwise.
SECTION 2.8. COMPENSATION shall have the same meaning as under the NACCO
Materials Handling Group, Inc. Profit Sharing Plan, except that Compensation
shall be deemed to include cash in
VOL402CL Doc: 154226.1
<PAGE> 5
5
lieu of perquisites and the amount of compensation deferred by the Participant
under this Plan or The North American Coal Corporation Deferred Compensation
Plan for Management Employees.
SECTION 2.9. EMPLOYER shall mean the Company and NACCO Industries, Inc.
SECTION 2.10. EXCESS RETIREMENT BENEFIT shall mean an Excess Pension
Benefit, Excess Profit Sharing Benefit or Excess Deferral Benefit (as described
in Article III) which is payable to or with respect to a Participant under this
Plan.
SECTION 2.11. EXCESS DEFERRALS shall mean the amounts described in Section
3.3(a) hereof.
SECTION 2.12. EXECUTIVE shall mean an Employee of the Company whose Base
Salary for the prior Plan Year was $100,000 or more.
SECTION 2.13. INSOLVENT. For purposes of this Plan, an Employer shall be
considered Insolvent at such time as it (a) is unable to pay its debts as they
mature, or (b) is subject to a pending voluntary or involuntary proceeding as a
debtor under the United States Bankruptcy Code.
SECTION 2.14. PARTICIPANT shall mean a Participant in one of the Qualified
Plans who is an Employee of an Employer whose benefit under such Qualified Plan
is limited by the application of Section 401(a) (17) or 415 of the Code and who
is designated as a Participant in this Plan by the Administrative Committee
under the applicable Qualified Plan. The term "Participant" shall also
include (a) any Executive who makes
VOL402CL Doc: 154226.1
<PAGE> 6
6
Executive Deferrals hereunder, and (b) any Employee who, as of February 9,
1993, was a participant in the Prior Plan.
SECTION 2.15. PLAN shall mean the NACCO Materials Handling Group, Inc.
Unfunded Benefit Plan, as herein set out or as duly amended.
SECTION 2.16. PLAN ADMINISTRATOR shall mean the Corporate Controller of the
Company.
SECTION 2.18. PRIOR PLAN shall mean the Yale Materials Handling Corporation
Unfunded Deferred Compensation Plan.
SECTION 2.19. PROFIT SHARING EMPLOYEE shall mean a participant in the NACCO
Materials Handling Group, Inc. Profit Sharing Plan who is eligible for Profit
Sharing Contributions.
SECTION 2.20. QUALIFIED PLAN shall mean (a) for Cash Balance Employees, the
NACCO Material Handling Group, Inc. Cash Balance Plan for Salaried Employees
(or any successor plan) and (b) for Profit Sharing Employees, the
profit-sharing portion of the NACCO Material Handling Group, Inc. Profit
Sharing Plan.
SECTION 2.21. UNFORESEEABLE EMERGENCY shall mean an event which results (or
will result) in severe financial hardship to the Participant as a consequence
of an unexpected illness or accident or loss of the Participant's property due
to casualty or other similar extraordinary or unforeseen circumstances out of
the control of the Participant.
SECTION 2.22. Valuation Date shall mean the last day of each Plan Year.
ARTICLE III
VOL402CL Doc: 154226.1
<PAGE> 7
7
EXCESS RETIREMENT BENEFITS
--------------------------
SECTION 3.1. EXCESS PENSION BENEFITS. The Excess Pension Benefit payable
to a Participant who is a Cash Balance Employee shall be a monthly benefit
equal to the excess, if any, of (a) the amount of the monthly benefit that
would be payable to the Participant under the Qualified Plan (in the form
actually paid) if such Plan did not contain the limitations imposed under
Sections 401(a) (17) and 415 of the Code, over (b) the amount of the monthly
benefit that is actually payable to the Participant under such Qualified Plan.
SECTION 3.2. EXCESS PROFIT SHARING BENEFITS.
(a) IN GENERAL. At the time described in Section 3.4(a), each Employer
shall credit to a Sub-Account (the "Excess Profit Sharing Sub-Account")
established for each Participant who is both an Employee of such Employer and
a Profit Sharing Employee, an amount equal to the excess, if any, of (i) the
amount of the Employer's Profit Sharing Contribution which would have been
made to the profit sharing portion of the Qualified Plan on behalf of the
Participant if (1) such Plan did not contain the limitations imposed under
Sections 401(a) (17) and 415 of the Code and (2) the term "Compensation" (as
defined in Section 2.8 hereof) were used for purposes of determining the
amount of profit sharing contributions under the Qualified Plan, over (ii)
the amount of the Employer's Profit Sharing
VOL402CL Doc: 154226.1
<PAGE> 8
8
Contribution which is actually made to such Plan on behalf of the Participant
for such Plan Year.
(b) MINIMUM BENEFIT. Notwithstanding the foregoing, the Excess Profit
Sharing Sub-Account balance of a Participant who was a participant in the Prior
Plan shall in no event be less than the amount credited to such Participant's
account under the Prior Plan as of the Effective Date.
SECTION 3.3. EXCESS DEFERRAL BENEFITS.
(a) AMOUNT OF EXCESS DEFERRALS. Each Executive may, within 30 days after
the Plan becomes effective as to him and prior to the first day of any Plan
Year thereafter, by written notice to the Plan Administrator, direct his
Employer:
(i) to reduce (in accordance with rules established by the Plan
Administrator) the Executive's Base Salary for the balance of the Plan
Year in which the Plan becomes effective as to him (but only with
respect to Base Salary payable for periods of service commencing after
the Executive so directs) or for any following Plan Year by a specified
dollar amount or percentage; and
(ii) to reduce the Executive's Bonus which is earned during the 1995 or
subsequent Plan Years by a specified dollar amount or percentage; and
(iii) to credit the deferrals (collectively, the "Excess Deferrals") to the
Sub-Account described in Section 3.4(b) at the times described
therein.
Notwithstanding the foregoing, an Executive's election-to make Excess Deferrals
must be made before October 1, 1994 in the case of elections upon the adoption
of this restatement of the Plan, and shall be effective with respect to his
Base Salary payable for his October 1, 1994 through December 31, 1994 service.
VOL402CL Doc: 154226.1
<PAGE> 9
9
(b) DEFERRAL PERIOD. The deferral election described in Subsection (a)
above shall also contain the Executive's election regarding the time of the
commencement of payment of his Excess Deferral Sub-Account. In the election
form, the Executive may elect to commence payment of his Excess Deferral
Sub-Account on (i) the date on which he ceases to be an employee of a
Controlled Group member, (ii) the date on which he attains an age specified in
the election form, or (iii) the earlier or later of such dates.
(c) EFFECT AND DURATION OF DEFERRAL ELECTION. Any direction by an Executive
to make Excess Deferrals hereunder shall be effective with respect to the Base
Salary and Bonus otherwise payable to the Executive during the period to which
the direction relates, and the Executive shall not be eligible to receive such
Excess Deferrals. Instead, such Excess Deferrals shall be credited to the
Executive's Sub-Account as provided in section 3.4(b). Any directions made in
accordance with Subsections (a) or (b) above shall be irrevocable and shall
remain in effect for subsequent periods described in Subsection (a) unless
terminated by the Executive by written notice to the Plan Administrator, on a
form provided by the Plan Administrator, prior to the first day of such
subsequent period. Notwithstanding the foregoing, an Executive's direction to
make Excess Deferrals hereunder shall automatically terminate on the earlier of
the date (i) the Executive ceases employment with the Employers, (ii) on which
the Executive's Employer is deemed
VOL402CL Doc: 154226.1
<PAGE> 10
10
Insolvent, (iii) the Executive is no longer eligible to make Excess Deferrals
hereunder or (iv) the Plan is terminated.
SECTION 3.4. PARTICIPANT'S ACCOUNTS. Each Employer shall establish and
maintain on its books an Account for each Executive and each Profit Sharing
Participant which shall contain the following entries:
(a) Credits to an Excess Profit Sharing Sub-Account for the Excess Profit
Sharing Benefits described in Section 3.2, which shall be credited to the
Sub-Account at the time the profit sharing contributions are otherwise credited
to participants' accounts under the Qualified Plan;
(b) Credits to an Excess Deferral Sub-Account for the Excess Deferrals
described in Section 3.3, which shall be credited to the Sub-Account at the
time such Deferrals would otherwise have been paid to the Executive;
(c) Credits to both Sub-Accounts for the earnings described in Article IV,
which shall continue until the vested portions of such Sub-Accounts have been
distributed to the Participant or his Beneficiary; and
(d) Debits for any distributions made from the Sub-Accounts.
SECTION 3.5. EFFECT ON OTHER BENEFITS. Benefits payable to or with respect
to a Participant under the Qualified Plans or any other Employer sponsored
(qualified or nonqualified) plan, if any, are in addition to those provided
under this Plan.
VOL402CL Doc: 154226.1
<PAGE> 11
11
ARTICLE IV
EARNINGS
--------
SECTION 4.1. FOR ACTIVE EMPLOYEES. At the end of each calendar month
during a Plan Year, the Excess Profit Sharing SubAccount and the Excess
Deferral 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 Sub-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 Plan Year
that is applicable to the Participant exceeds the rate credited to the
Participant's Sub-Accounts under the preceding sentence, the Participant's
SubAccounts 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 Sub-Account balance during each month
of such Plan Year by the Adjusted ROE determined for such Plan Year, compounded
monthly.
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
the vested portion of each Sub-Account has been distributed in full. The
Adjusted ROE calculation described in the second sentence of Section 4.1 shall
be made during the month in which the
VOL402CL Doc: 154226.1
<PAGE> 12
12
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 Participant's Employer. For any subsequent
month, the Adjusted ROE calculation described in the second sentence of Section
4.1 shall not apply. The Stable Asset Fund calculation described in the first
sentence of Section 4.1 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 Stable Asset Fund.
ARTICLE V
VESTING
-------
A Participant shall not become vested in his Excess Pension Benefit or
Excess Profit Sharing Benefit until he becomes vested in his benefit under the
applicable underlying Qualified Plan and the Excess Pension Benefit and/or
Excess Profit Sharing Benefit of a Participant who is partially or fully vested
under the applicable underlying Qualified Plan shall at all times be vested
hereunder to the extent he is so vested. A Participant shall always be 100%
vested in his Excess Deferral Benefit hereunder.
ARTICLE VI
DISTRIBUTION OF BENEFITS TO PARTICIPANTS
----------------------------------------
SECTION 6.1. TIME AND MANNER OF PAYMENT.
(a) EXCESS PENSION BENEFITS AND EXCESS PROFIT SHARING BENEFITS. The
Excess Pension Benefit and Excess Profit Sharing
VOL402CL Doc: 154226.1
<PAGE> 13
13
Benefit payable to a Participant shall be paid in the form of a single lump sum
payment at the time the benefits payable to the Participant under the
applicable underlying Qualified Plan commence to be paid. For purposes of the
Excess Pension Benefit, such lump sum amount shall be equal to the Actuarial
Equivalent present value of such Excess Pension Benefit.
(b) EXCESS DEFERRAL BENEFITS.
(i) TIMING. The Excess Deferral Benefits shall be paid (or commence to be
paid) to the Executive at the time specified in the Executive's deferral
election form pursuant to Section 3.3(b).
(ii) FORM. The Excess Deferral Benefit shall be distributed to the
Executive in the form of ten annual installments with each installment being
based on the value of the Executive's Excess Deferral Sub-Account on the
Valuation Date immediately preceding the date such installment is to be paid
and being a fraction of such value in which the numerator is one and the
denominator is the total number of remaining installments to be paid.
Notwithstanding the foregoing, the Executive may elect to receive his Excess
Deferral Benefit in the form of a single lump sum payment or in annual
installments for a period of less than 10 years by filing a notice in writing,
signed by the Executive while he is alive and filed with the Plan Administrator
at least one year prior to the time he had elected to commence receiving
payment of his Excess Deferral Sub-Account. Any such selection of the form of
benefit may be changed at any time and
VOL402CL Doc: 154226.1
<PAGE> 14
14
from time to time, without the consent of any other person, by filing a later
selection in writing that is signed by the Executive and filed with the Plan
Administrator while the Executive is alive and at least one year prior to the
time he had elected to commence receiving payment of his Excess Deferral
SubAccount.
(c) UNFORESEEABLE EMERGENCY DISTRIBUTIONS. Notwithstanding the foregoing,
an Employer may at any time, upon written request of the Participant, cause to
be paid to such Participant an amount equal to all or any part of the vested
Employer determines, in its absolute discretion based on such reasonable
evidence that it shall require, that such a payment or payments is necessary
for the purpose of alleviating the consequences of an Unforeseeable Emergency
occurring with respect to the Participant. Payments of amounts because of an
Unforeseeable Emergency shall be permitted only to the extent reasonably
necessary to satisfy the emergency need. Any Executive whose eligibility to
make before-tax contributions to the NACCO Materials Handling Group, Inc.
Profit Sharing Plan has been suspended because he has taken a hardship
withdrawal from such plan shall not be eligible to make Excess Deferrals under
this Plan for the period of his suspension from the NACCO Materials Handling
Group, Inc. Profit Sharing Plan.
(d) SMALL SUB-ACCOUNTS. Notwithstanding the foregoing, in the event that
the vested portion of a Participant's Excess Profit Sharing Sub-Account or his
Excess Deferral Sub-Account
VOL402CL Doc: 154226.1
<PAGE> 15
15
does not exceed $5,000 at the time of the Participant's termination of
employment with the Controlled Group, such vested portions of his Sub-Accounts
shall automatically be paid to him in a single lump sum payment as soon as
practicable following his termination of employment.
SECTION 6.2. LIABILITY FOR PAYMENT/EXPENSES. Each Employer shall be liable
for the payment of the Excess Retirement Benefits which are payable hereunder
to its Employees. Expenses of administering the Plan shall be paid by the
Employers, as directed by the Company.
ARTICLE VII
BENEFICIARIES
-------------
SECTION 7.1. BENEFICIARY DESIGNATIONS. A designation of a Beneficiary
hereunder may be made only by an instrument (in form acceptable to the Plan
Administrator) signed by the Participant and filed with the Plan Administrator
prior to the Participant's death. In the absence of such a designation and at
any other time when there is no existing Beneficiary designated hereunder, (a)
the Beneficiary of a Participant for his Excess Pension Benefits and/or his
Excess Profit Sharing Benefits shall be his Beneficiary under the applicable
Qualified Plan, and (b) the Beneficiary of a Participant for his Excess
Deferral Benefits shall be his surviving spouse or, if none, his estate. A
person designated by a Participant as his Beneficiary who or which ceases to
exist shall not be entitled to any part of any payment thereafter to be made to
the Participant's Beneficiary unless the
VOL402CL Doc: 154226.1
<PAGE> 16
16
Participant's designation specifically provided to the contrary. If two or more
persons designated as a Participant's Beneficiary are in existence with respect
to a single Excess Retirement Benefit, the amount of any payment to the
Beneficiary under this Plan shall be divided equally among such persons unless
the Participant's designation specifically provided to the contrary.
SECTION 7.2. CHANGE IN BENEFICIARY. (a) Anything herein or in the
Qualified Plans to the contrary notwithstanding, a Participant may, at any time
and from time to time, change a Beneficiary designation hereunder without the
consent of any existing Beneficiary or any other person. A change in
Beneficiary hereunder may be made regardless of whether such a change is also
made under the Qualified Plans. In other words, the Beneficiary hereunder need
not be the same as under the Qualified Plan.
(b) Any change in Beneficiary shall be made by giving written notice thereof
to the Plan Administrator and any change shall be effective only if received by
the Plan Administrator prior to the death of the Participant.
SECTION 7.3. DISTRIBUTIONS TO BENEFICIARIES.
(a) AMOUNT OF BENEFITS.
(1) AMOUNT OF EXCESS PENSION BENEFIT. The Excess Pension Benefit payable
to a Beneficiary under this Plan shall be a monthly benefit equal to
the excess, if any, of (i) the amount of the monthly benefit that
would be payable to the Beneficiary
VOL402CL Doc: 154226.1
<PAGE> 17
17
last effectively designated by the Participant under the applicable
underlying Qualified Plan (in the form actually paid) if such Plan
did not contain the limitations imposed under Sections 401(a) (17)
and 415 of the Code, over (ii) the amount of the monthly benefit that
is actually paid to such Beneficiary under such Plan.
(2) AMOUNT OF EXCESS PROFIT SHARING BENEFIT. The Excess Profit Sharing
Plan Benefit payable to a Participant's Beneficiary under this Plan
shall be equal to such Participant's Excess Profit Sharing Sub-Account
balance on the date of the distribution of the Sub-Account to the
Beneficiary.
(3) AMOUNT OF EXCESS DEFERRAL BENEFIT. The Excess Deferral Benefit
payable to a Participant's Beneficiary under this Plan shall be equal
to such Participant's Excess Deferral Sub-Account balance on the date
of the distribution of the Sub-Account to the Beneficiary.
(b) TIME OF PAYMENT.
(1) EXCESS PENSION BENEFIT. The Excess Pension Benefit payable to a
Beneficiary under this Plan shall be paid at the time the benefits
payable to the Beneficiary last effectively designated by the
VOL402CL Doc: 154226.1
<PAGE> 18
18
Participant under the applicable underlying Qualified Plan commence to
be paid.
(2) EXCESS PROFIT SHARING BENEFIT/EXCESS DEFERRAL BENEFIT. The Excess
Profit Sharing Benefit and Excess Deferral Benefit payable to a
Beneficiary under this Plan shall be paid as soon as practicable
following the death of the Participant.
(c) MANNER OF PAYMENT. All Excess Retirement Benefits payable to a
Beneficiary hereunder shall be paid in the form of a lump sum payment. For
purposes of the Excess Pension Benefit, such lump sum amount shall be equal to
the Actuarial Equivalent present value of such Excess Pension Benefit.
ARTICLE VIII
MISCELLANEOUS
-------------
SECTION 8.1. LIABILITY OF EMPLOYER. Nothing in this Plan shall constitute
the creation of a trust or other fiduciary relationship between an Employer and
any Participant, Beneficiary or any other person.
SECTION 8.2. LIMITATION ON RIGHTS OF PARTICIPANTS AND BENEFICIARIES - NO
LIEN. The Plan is designed to be an unfunded, nonqualified plan. Nothing
contained herein shall be deemed to create a trust or lien in favor of any
Participant or Beneficiary on any assets of an Employer. The Employers shall
have no obligation to purchase any assets that do not remain subject to the
claims of the creditors of the Employers for use in
VOL402CL Doc: 154226.1
<PAGE> 19
19
connection with the Plan. No Participant or Beneficiary or any other person
shall have any preferred claim on, or any beneficial ownership interest in, any
assets of the Employers prior to the time that such assets are paid to the
Participant or Beneficiary as provided herein. Each Participant and
Beneficiary shall have the status of a general unsecured creditor of the
Employers.
SECTION 8.3. NO GUARANTEE OF EMPLOYMENT. Nothing in this Plan shall be
construed as guaranteeing future employment to Participants. A Participant
continues to be an Employee of an Employer solely at the will of such Employer
subject to discharge at any time, with or without cause.
SECTION 8.4. PAYMENT TO GUARDIAN. If a benefit payable hereunder is
payable to a minor, to a person declared incompetent or to a person incapable
of handling the disposition of his benefit to the guardian, legal
representative or person having the care and custody of such minor, incompetent
or person. The Plan Administrator may require such proof of incompetency,
minority, incapacity or guardianship as it may deem appropriate prior to
distribution of the benefit. Such distribution shall completely discharge the
Employers from all liability with respect to such benefit.
SECTION 8.5. ASSIGNMENT. No right or interest under this Plan of any
Participant or Beneficiary shall be assignable or transferable in any manner or
be subject to alienation, anticipation, sale, pledge, encumbrance or other
legal process or
VOL402CL Doc: 154226.1
<PAGE> 20
20
in any manner be liable for or subject to the debts or liabilities of the
Participant or Beneficiary.
SECTION 8.6. SEVERABILITY. If any provision of this Plan or the
application thereof to any circumstance(s) or person(s) is held to be invalid
by a court of competent jurisdiction, the remainder of the Plan and the
application of such provision to other circumstances or persons shall not be
affected thereby.
ARTICLE IX
ADMINISTRATION OF PLAN
----------------------
SECTION 9.1. ADMINISTRATION. (a) IN GENERAL. The Plan shall be
administered by the Plan Administrator. The Plan Administrator shall have sole
and absolute discretion to interpret where necessary all provisions of the Plan
(including, without limitation, by supplying omissions from, correcting
deficiencies in, or resolving inconsistencies or ambiguities in, the language
of the Plan), to determine the rights and status under the Plan of
Participants, Executives, or other persons, to resolve questions or disputes
arising under the Plan and to make any determinations with respect to the
benefits payable under the Plan and the persons entitled thereto as may be
necessary for the purposes of the Plan. Without limiting the generality of the
foregoing, the Plan Administrator is hereby granted the authority (i) to
determine whether a particular employee is an Executive or Participant, and
(ii) to determine if an employee is entitled to Excess Retirement Benefits
hereunder and, if so, the amount and
VOL402CL Doc: 154226.1
<PAGE> 21
21
duration of such Benefits. The Plan Administrator's determination of the
rights of any employee or former employee hereunder shall be final and binding
on all persons, subject only to the claims procedures outlined in Section 9.3
hereof.
(b) DELEGATION OF DUTIES. The Plan Administrator may delegate any of its
administrative duties, including, without limitation, duties with respect to
the processing, review, investigation, approval and payment of Excess
Retirement Benefits, to a named administrator or administrators.
SECTION 9.2. REGULATIONS. The Plan Administrator shall promulgate any
rules and regulations it deems necessary in order to carry out the purposes of
the Plan or to interpret the provisions of the Plan; provided, however, that no
rule, regulation or interpretation shall be contrary to the provisions of the
Plan. The rules, regulations and interpretations made by the Plan
Administrator shall, subject only to the claims procedure outlined in Section
9.3 hereof, be final and binding on all persons.
SECTION 9.3. CLAIMS PROCEDURES. The Plan Administrator shall determine the
rights of any employee or former employee to any Excess Retirement Benefits
hereunder. Any employee or former employee who believes that he has not
received the Excess Retirement Benefits to which he is entitled under the Plan
may file a claim in writing with the Plan Administrator. The Plan
Administrator shall, no later than 90 days after the receipt of a claim (plus
an additional period of 90 days if
VOL402CL Doc: 154226.1
<PAGE> 22
22
required for processing, provided that notice of the extension of time is given
to the claimant within the first 90 day period), either allow or deny the claim
in writing. If a claimant does not receive written notice of the Plan
Administrator's decision on his claim within the above-mentioned period, the
claim shall be deemed to have been denied in full.
A denial of a claim by the Plan Administrator, wholly or partially, shall be
written in a manner calculated to be understood by the claimant and shall
include:
(a) the specific reasons for the denial;
(b) specific reference to pertinent Plan provisions on which the denial is
based;
(c) a description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why such
material or information is necessary; and
(d) an explanation of the claim review procedure.
A claimant whose claim is denied (or his duly authorized representative) may
within 60 days after receipt of denial of a claim file with the Plan
Administrator a written request for a review of such claim. If the claimant
does not file a request for review of his claim within such 60-day period, the
claimant shall be deemed to have acquiesced in the original decision of the
Plan Administrator on his claim. If such an appeal is so filed within such 60
day period, the Company (or its delegate) shall conduct a full and fair review
of such claim. During such review, the claimant shall be given the opportunity
to review documents that are pertinent to his claim and to submit issues and
comments in writing.
VOL402CL Doc: 154226.1
<PAGE> 23
23
The Company shall mail or deliver to the claimant a written decision on the
matter based on the facts and the pertinent provisions of the Plan within 60
days after the receipt of the request for review (unless special circumstances
require an extension of up to 60 additional days, in which case written notice
of such extension shall be given to the claimant prior to the commencement of
such extension). Such decision shall be written in a manner calculated to be
understood by the claimant, shall state the specific reasons for the decision
and the specific Plan provisions on which the decision was based and shall, to
the extent permitted by law, be final and binding on all interested persons.
If the decision on review is not furnished to the claimant within the
above-mentioned time period, the claim shall be deemed to have been denied on
review.
SECTION 9.4. REVOCABILITY OF PLAN ADMINISTRATOR/COMPANY ACTION. Any action
taken by the Plan Administrator or the Company with respect to the rights or
benefits under the Plan of any employee or former employee shall be revocable
by the Plan Administrator or the Company as to payments not yet made to such
person, and acceptance of any Excess Retirement Benefits under the Plan
constitutes acceptance of and agreement to the Plan Administrator's or the
Company's making any appropriate adjustments in future payments to such person
(or to recover from such person) any excess payment or underpayment previously
made to him.
SECTION 9.5. AMENDMENT. The Nominating, Organization and Compensation
Committee of the Board of Directors of the Company (the
VOL402CL Doc: 154226.1
<PAGE> 24
24
"Committee") may at any time (without the consent of any Employer) amend any or
all of the provisions of this Plan, except that (a) no such amendment may
adversely affect any Participant's vested Excess Retirement Benefit as of the
date of such amendment, without the prior written consent of such Participant,
and (b) no such amendment may suspend the crediting of earnings on the balance
of a Participant's Account, until the entire balance of such Account has been
distributed. Any amendment shall be in the form of a written instrument
executed by an officer of the Company on the order of the Committee. Subject
to the foregoing provisions of this Section, such amendment shall become
effective as of the date specified in such instrument or, if no such date is
specified, on the date of its execution.
SECTION 9.6. TERMINATION.
(a) The Committee (without the consent of any Employer), in its sole
discretion, may terminate this Plan at any time and for any reason whatsoever,
except that (i) no such termination may adversely affect any Participant's
vested Excess Retirement Benefit as of the date of such termination, without
the prior written consent of such Participant, and (ii) no such termination may
suspend the crediting of earnings on the balance of a Participant's Account,
until the entire balance of such Account has been distributed. Any such
termination shall be expressed in the form of a written instrument executed by
an officer of the Company on the order of the Committee. Subject to the
foregoing provisions of this Section, such termination shall become effective
as of the date
VOL402CL Doc: 154226.1
<PAGE> 25
25
specified in such instrument or, if no such date is specified, on the date of
its execution. Written notice of any termination shall be given to the
Participants as soon as practicable after the instrument is executed.
(b) Notwithstanding anything in the Plan to the contrary, in the event of a
termination of the Plan, the Company, in its sole and absolute discretion,
shall have the right to change the time and form of distribution of
Participants' Excess Retirement Benefits.
SECTION 9.7. WITHDRAWAL BY EMPLOYER. Any Employer (other than the Company)
which adopts this Plan may elect separately to withdraw from such Plan and such
withdrawal shall constitute a termination of the Plan as to it; provided,
however, that (a) such terminating Employer shall continue to be an Employer
for the purposes hereof as to Participants or Beneficiaries to whom it owes
obligations hereunder, and (b) such termination shall be subject to the
limitations and other conditions described in Section 9.6, treating the
Employer as if it were the Company.
Executed, this ______ day of ____________, 1994, to be effective as of
October 1, 1994.
NACCO MATERIALS HANDLING GROUP,
INC.
By:________________________________
Title:
VOL402CL Doc: 154226.1
<PAGE> 1
Exhibit 10(cvi)
NACCO MATERIALS HANDLING GROUP, INC.
UNFUNDED BENEFIT PLAN
(As Amended and Restated Effective October 1, 1994)
INSTRUMENT OF ADOPTION AND MERGER
WHEREAS, NACCO Industries, Inc. ("NACCO") employees became
covered under the profit sharing portion of the NACCO Materials Handling Group,
Inc. Profit Sharing Plan (the "Qualified Plan") and the NACCO Materials
Handling Group, Inc. Unfunded Benefit Plan (the "Plan"), effective December 31,
1993;
WHEREAS, NACCO adopted the Before Tax Contributions and
Matching Employer Contributions portions of the Qualified Plan effective
December 1, 1994; and
WHEREAS, NACCO employees are covered under The North American
Coal Corporation Deferred Compensation Plan for Management Employees (the
"North American Coal Plan") with respect to their excess Before Tax
Contributions and excess Matching Employer Contributions and NACCO desires to
cover such employees under the Plan effective January 1, 1995;
NOW THEREFORE:
NACCO hereby adopts the Plan for the benefit of its employees
who satisfy the requirements of a "Participant" (as defined in Section 2.14 of
the Plan, as amended by Amendment No. 2), effective January 1, 1995. As a
result, effective January 1, 1995, NACCO shall provide excess Before Tax
Contributions and excess Matching Employer Contributions to NACCO 401(k)
Employees through the Plan and the liabilities of NACCO to NACCO 401(k)
Employees shall continue after January 1, 1995 under the Plan. Any such
liabilities of NACCO existing as of December 31, 1994 under the North American
Coal Plan shall be transferred from the North American Coal Plan to the Plan
effective January 1, 1995.
Date: December 30, 1994 NACCO INDUSTRIES, INC.
-----------------
By: Steve M. Billick
--------------------------------
Title: Vice President and Controller
-----------------------------
<PAGE> 2
This Instrument of Adoption and Merger and the terms and
provisions hereof are hereby consented to by NACCO Materials Handling Group,
Inc., the sponsor of the Plan.
NACCO MATERIALS HANDLING
GROUP, INC.
By: Charles A. Bittenbender
------------------------
Title: Assistant Secretary
---------------------
<PAGE> 1
AMENDMENT NO. 2
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. 2 to
the NACCO Materials Handling Group, Inc. Unfunded Benefit Plan (the "Plan").
The provisions of this Amendment shall be effective 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
---------
Section 1.2 of the Plan is hereby amended by adding the words "(3) the
limitations under Sections 402(g), 401(k)(3) and 401(m) of the Code, and" after
the words "Section 415 of the Code, and".
Section 2
---------
Section 2.1 of the Plan is hereby amended by adding the words ", Excess
401(k) Sub-Account, Excess Matching Sub-Account" after the words "Excess Profit
Sharing Sub-Account".
Section 3
---------
Section 2.2 of the Plan is hereby amended by adding the words "and NACCO
401(k) Employees" after the words "Profit Sharing Employees".
Section 4
---------
Section 2.10 of the Plan is hereby amended by adding the words ", Excess
401(k) Benefit, Excess Matching Benefit" after the words "Excess Profit Sharing
Benefit".
Section 5
---------
A new Section 2.13A is hereby added to the Plan, to read as follows:
"SECTION 2.13A. NACCO 401(K) EMPLOYEE shall mean an Employee
of NACCO Industries, Inc. who is a Participant in the NACCO Materials
Handling Group, Inc. Profit Sharing Plan who is eligible for
Before-Tax Contributions and Matching Employer Contributions
thereunder."
1
VOL402CL Doc: 154340.1
<PAGE> 2
Section 6
---------
Section 2.14 of the Plan is hereby amended by adding the following sentence
to the end thereof:
"In addition, the term "Participant" shall include a NACCO
401(k) Employee who is (i) unable to make all of the Before-Tax
Contributions that he has elected to make to the NACCO Materials
Handling Group, Inc. Profit Sharing Plan, or unable to receive the
maximum amount of Matching Employer Contributions under the NACCO
Materials Handling Group, Inc. Profit Sharing Plan because of the
limitations of Section 402(g), 401(a)(17), 401(k)(3), or 401(m) of the
Code, and (ii) has at least 950 Hay Points."
Section 7
---------
Section 2.16 of the Plan is hereby amended by adding the words "for
participating employees of NACCO Materials Handling Company and NACCO
Industries, Inc. for participating employees and NACCO 401(k) Employees" after
the words "Controller of the Company".
Section 8
---------
Section 2.20 of the Plan is hereby amended by adding the words "and (c) for
NACCO 401(k) Employees, the Before Tax Contributions and Matching Employer
Contributions portion of the NACCO Materials Handling Group, Inc. Profit
Sharing Plan" after the words "Profit Sharing Plan".
Section 9
---------
A new Section 3.3A is hereby added to the Plan, to read as follows:
"SECTION 3.3A. EXCESS 401(K) BENEFITS.
(a) AMOUNT OF EXCESS 401(K) BENEFITS. Each NACCO 401(k) Employee who is
a Participant under the terms of this Plan, may, prior to the first day of
any Plan Year, by completing a Notice of Election to Defer Compensation for
Certain NACCO Industries, Inc. Employees or other form approved by his
Employer ("Deferral Election Form"), direct his Employer:
(i) to reduce his Compensation (as that term is defined in Section 2.8
herein, but including amounts received in excess of the limitation imposed
by Code Section 401(a)(17)) by the difference between (A) a certain
percentage, in 1% increments, with a maximum of 17%, of his Compensation
for the calendar year, and (B) the
2
VOL402CL Doc: 154340.1
<PAGE> 3
maximum Before-Tax Contributions actually permitted to be
contributed for him to the NACCO Materials Handling Group, Inc. Profit
Sharing Plan by reason of the application of the limitations under
Sections 402(g), 401(a)(17), and 401(k)(3) of the Code; and,
(ii) to credit the deferrals (collectively, the "Excess 401(k)
Benefits") to the Sub-Account described in Section 3.4(c) at the times
described therein.
(b) DEFERRAL PERIOD. The deferral election described in Subsection (a)
above shall also contain such Participant's election regarding the time of
the commencement of payment of his Excess 401(k) Sub-Account. In the
Deferral Election Form, such Participant may elect to commence payment of
his Excess 401(k) Sub-Account on (i) the date on which he ceases to be an
employee of a Controlled Group member, (ii) the date on which he attains an
age specified in the Deferral Election Form, or (iii) the earlier or later
of such dates.
(c) EFFECT AND DURATION OF DEFERRAL ELECTION. Any direction by a NACCO
401(k) Employee who is a Participant in this Plan to make deferrals of
Excess 401(k) Benefits hereunder shall be effective with respect to
Compensation otherwise payable to the Participant, and the Participant shall
not be eligible to receive such Excess 401(k) Benefits. Instead such
amounts shall be credited to the Participant's Sub-Account as provided in
Section 3.4(c). Any directions made in accordance with Subsections (a) or
(b) above shall be irrevocable and shall remain in effect for subsequent
Plan Years unless for subsequent years changed or terminated by the
Participant, on the appropriate form provided by the Plan Administrator,
prior to the first day of such subsequent Plan Year. Notwithstanding the
foregoing, a Participant's direction to make deferrals of Excess 401(k)
Benefits shall automatically terminate on the earlier of the date on which
(i) the Participant ceases employment with the Employers, (ii) the
Participant's Employer is deemed Insolvent, (iii) the Participant is no
longer eligible to make deferrals of Excess 401(k) Benefits hereunder or
(iv) the Plan is terminated."
3
VOL402CL Doc: 154340.1
<PAGE> 4
Section 10
----------
A new Section 3.3B is hereby added to the Plan, to read as follows:
"SECTION 3.3B. EXCESS MATCHING BENEFITS.
(a) IN GENERAL. A NACCO 401(k) Employee who is a Participant in the
Plan shall have credited to his Excess Matching Sub-Account an
amount equal to the Matching Employer Contributions that he is
prevented from receiving under the Qualified Plan because of the
limitations of Code Sections 402(g), 401(a)(17), 401(k)(3) and 401(m)
of the Code (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 Excess 401(k)
Benefits deferred for the same Plan Year in which Excess Matching
Benefits are credited to the Sub-Account."
Section 11
----------
Section 3.4 of the Plan is hereby amended by (i) adding the words ", each
NACCO 401(k) Employee," after the words "for each Executive" in the first
paragraph thereof; (ii) deleting the word "both" in Subsection (c); (iii)
relettering Subsections (c) and (d) as Subsections (f) and (g), respectively;
and (iv) by adding new Subsections (c), (d) and (e), to read as follows:
"(c) Credits to an Excess 401(k) Sub-Account for the Excess
401(k) Benefits described in Section 3.3A, which shall be credited to
the Sub-Account when a NACCO 401(k) Employee is prevented from making
a Before-Tax Contribution under the Qualified Plan;
(d) Credits to an Excess Matching Sub-Account for the Excess
Matching Benefits described in Section 3.3B, which shall be credited
to the Sub-Account when a NACCO 401(k) Employee is prevented from
receiving Matching Employer Contributions under the Qualified Plan;"
(e) Credits to the appropriate Sub-Account of a NACCO 401(k)
Employee of the amount of any and all liabilities of NACCO Industries,
Inc. on December 31, 1994 under the North American Coal Corporation
Deferred Compensation Plan for Management Employees to such NACCO
401(k) Employee;"
4
VOL402CL Doc: 154340.1
<PAGE> 5
Section 12
----------
Article IV of the Plan is hereby amended by (i) changing the heading of
Section 4.1 to read "FOR ACTIVE PROFIT SHARING EMPLOYEES AND EXECUTIVES"; (ii)
renumbering Section 4.2 as Section 4.3; (iii) adding the words "or 4.2" after
"Section 4.1" the first time it appears in Section 4.3 (as renumbered) and
changing the reference in such Section from "this Section 4.2" to "this Section
4.3"; and (iv) adding a new Section 4.2, to read as follows:
"SECTION 4.2. FOR ACTIVE NACCO 401(K) EMPLOYEES. At the end of each
calendar month during a Plan Year, the Excess 401(k) sub-account and the
Excess Matching Sub-Account of each NACCO 401(k) employee who is employed by
an employer on December 31 of such year shall be credited with an amount of
earnings determined from time to time by NACCO Industries, Inc. Effective
January 1, 1995, such amount shall be determined (a) in accordance with the
provisions of section 4.1 For Excess 401(k) Benefits and Excess Matching
Benefits attributable to amounts deferred pursuant to Section 3.3(A) by a
NACCO 401(k) Employee up to 7% of his Compensation and (b) by multiplying
Excess 401(k) Benefits and Excess Matching Benefits attributable to amounts
deferred pursuant to Section 3.3(A) In excess of 7% of Compensation by the
blended rate earned during such month by the Stable Asset Fund under the
NACCO Materials Handling Group, Inc. Profit Sharing Plan. NACCO Industries,
Inc. may change the earnings rate credited on Excess 401(k) Sub-Account and
Excess Matching Sub-Account balances at any time upon at least 30 days
advance notice to NACCO 401(k) Employees."
Section 13
----------
Article V of the Plan is hereby amended by (i) adding the words ", Excess
Matching Benefit" after the words "Excess Pension Benefit", the first time such
words appear, (ii) adding the words ", and/or Excess Matching Benefit," after
the words "Excess Pension Benefit", the second time such words appear, and
(iii) adding the words "and/or his Excess 401(k) Benefit" after the words
"Excess Deferral Benefit".
Section 14
----------
Subsection 6.1(b) of the Plan is hereby amended to read as follows:
"(b) EXCESS DEFERRAL BENEFITS, EXCESS 401(K) BENEFITS AND EXCESS MATCHING
BENEFITS.
(i) TIMING. The Excess Deferral Benefits shall be paid (or commence to
be paid) to the Executive
5
VOL402CL Doc: 154340.1
<PAGE> 6
at the time specified in the Executive's deferral election form pursuant to
Section 3.3(b). The Excess 401(k) Benefits and Excess Matching Benefits (to
the extent vested) shall be paid (or commence to be paid) to the NACCO
401(k) Employee at the time specified in the Deferral Election Form.
(ii) FORM. The Excess Deferral Benefit, Excess 401(k) Benefit and/or
Excess Matching Benefit, to the extent vested, shall be distributed to the
Executive or the NACCO 401(k) Employee, as the case may be, in the form of
ten annual installments with each installment being based on the value of
the Excess Deferral Sub-Account, Excess 401(k) Sub-Account or Excess
Matching Sub-Account, as the case may be, on the Valuation Date immediately
preceding the date such installment is to be paid and being a fraction of
such value in which the numerator is one and the denominator is the total
number of remaining installments to be paid. Notwithstanding the foregoing,
the Executive or the NACCO 401(k) Employee may elect to receive his Excess
Deferral Benefit, Excess 401(k) Benefit and/or Excess matching Benefit, to
the extent vested, in the form of a single lump sum payment or in annual
installments for a period of less than 10 years by filing a notice in
writing, signed by the Executive or NACCO 401(k) Employee while he is alive
and filed with the Plan Administrator at least one year prior to the time he
had elected to commence receiving payment of his Excess Deferral Sub-Account
or the portion of his Excess 401(k) Sub-Account and/or Excess Matching
Sub-Account to which such election applies. Any such election of the form
of benefit may be changed at any time and from time to time, without the
consent of any other person, by filing a later election in writing that is
signed by the Executive or the NACCO 401(k) Employee and filed with the Plan
Administrator while the Executive or the NACCO 401(k) Employee is alive and
at least one year prior to the time he had elected to commence receiving
payment of his Excess Deferral Sub-Account or the portion of his Excess
401(k) Sub-Account and/or Excess Matching Sub-Account to which such
election applies."
Section 15
----------
Subsection 6.1(c) of the Plan is hereby amended by (i) adding the words
"and/or Excess 401(k) Sub-Account, and/or Excess Matching Account" after the
words "Excess Deferral Sub-Account"; and (ii) by adding the words "or Excess
401(k) Benefits" after the words "eligible to make Excess Deferrals" where such
words may appear therein.
6
VOL402CL Doc: 154340.1
<PAGE> 7
Section 16
----------
Subsection 6.1(d) of the Plan is hereby amended by adding the words ", his
Excess 401(k) Sub-Account, his Excess Matching Sub-Account" after the words
"Excess Profit Sharing Sub-Account".
Section 17
----------
Section 7.1 of the Plan is hereby amended by adding the words ", and/or his
Excess 401(k) Benefits, and/or Excess Matching Benefits" after the words
"Excess Pension Benefits".
Section 18
----------
Subsection 7.3(a) of the Plan is hereby amended by adding new Subparagraphs
(4) and (5) thereto, to read as follows:
"(4) AMOUNT OF EXCESS 401(K) BENEFIT. The Excess 401(k) Benefit payable to
a Participant's Beneficiary under this Plan shall be equal to such
Participant's Excess 401(k) Sub-Account balance on the date of the
distribution of the Sub-Account to the Beneficiary.
(5) AMOUNT OF EXCESS MATCHING BENEFIT. The Excess Matching Benefit
payable to a Participant's Beneficiary under this Plan shall be equal
to such Participant's Excess Matching Sub-Account balance on the date
of the distribution of the Sub-Account to the Beneficiary."
Section 19
----------
Subparagraph 7.3(b)(2) of the Plan is hereby amended by (i) adding the words
"/EXCESS 401(K) BENEFIT/EXCESS MATCHING BENEFIT" after the words "EXCESS PROFIT
SHARING BENEFIT/EXCESS DEFERRAL BENEFIT" in the heading thereof, and (ii)
adding the words ", Excess 401(k) Benefit, Excess Matching Benefit" after the
words "Excess Profit Sharing Benefit".
EXECUTED this ____ day of December, 1994.
NACCO MATERIALS HANDLING GROUP, INC.
By:________________________
Title:_____________________
7
VOL402CL Doc: 154340.1
<PAGE> 1
Exhibit 10(cviii)
Execution Copy
$350,000,000
CREDIT AGREEMENT
dated as of
February 28, 1995
among
NACCO Materials Handling Group, Inc.,
The Banks Listed Herein,
The Co-Agents Listed Herein
and
Morgan Guaranty Trust Company of New York,
as Agent
____________________________
Arranged by:
J.P. Morgan Securities, Inc.,
BA Securities, Inc., and
Citicorp Securities, Inc.,
as Co-Arrangers
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE 1
DEFINITIONS
<S> <C> <C>
1.1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2. Accounting Terms and Determinations . . . . . . . . . . . . . . . . . . . . . . . . . . 21
1.3. Types of Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE 2
THE CREDITS
2.1. Commitments to Lend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.2. Extension of Termination Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.3. Notice of Committed Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.4. Money Market Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.5. Alternative Currency Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.6. Notice to Banks; Funding of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
2.7. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.8. Maturity of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.9. Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
2.10. Facility Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
2.11. Optional Termination or Reduction of Commitments . . . . . . . . . . . . . . . . . . . 37
2.12. Method of Electing Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
2.13. Mandatory Termination of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . 39
2.14. Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
2.15. General Provisions as to Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
2.16. Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
2.17. Computation of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
2.18. Regulation D Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
2.19. Judgment Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
ARTICLE 3
CONDITIONS
3.1. Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
3.2. Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
4.1. Corporate Existence and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
4.2. Corporate and Governmental Authorization; No Contravention . . . . . . . . . . . . . . . 45
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
4.3. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
4.4. Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
4.5. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
4.6. Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
4.7. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
4.8. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
4.9. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
4.10. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
4.11. No Regulatory Restrictions on Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
4.12. Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
4.13. Solvency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE 5
COVENANTS
5.1. Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
5.2. Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
5.3. Maintenance of Property; Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
5.4. Conduct of Business and Maintenance of Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
5.5. Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.6. Inspection of Property, Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.7. Mergers and Sales of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.8. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
5.9. Negative Pledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
5.10. Debt Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
5.11. Debt of Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
5.12. Interest Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
5.13. Minimum Consolidated Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
5.14. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
5.15. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
5.16. Consolidated Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
5.17. Accommodation Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
5.18. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
5.19. Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
ARTICLE 6
DEFAULTS
6.1. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.2. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
</TABLE>
ARTICLE 7
THE AGENT
ii
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C>
7.1. Appointment and Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
7.2. Agent and Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
7.3. Action by Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7.4. Consultation with Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7.5. Liability of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7.6. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7.7. Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
7.8. Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
7.9. Agent's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
ARTICLE 8
CHANGE IN CIRCUMSTANCES
8.1. Basis for Determining Interest Rate Inadequate or Unfair . . . . . . . . . . . . . . . . 66
8.2. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
8.3. Increased Cost and Reduced Return . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
8.4. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
8.5. Base Rate Loans Substituted for Affected Fixed Rate Loans . . . . . . . . . . . . . . . 71
8.6. Substitution of Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
ARTICLE 9
MISCELLANEOUS
9.1. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
9.2. No Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
9.3. Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
9.4. Sharing of Set-Offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
9.5. Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
9.6. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
9.7. Collateral. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
9.8. Release of Existing Security Interests and Existing Guaranties . . . . . . . . . . . . . 77
9.9. Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
9.10. WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
9.11. Governing Law; Submission to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . 78
9.12. Counterparts; Integration; Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . 78
</TABLE>
Pricing Schedule
Exhibit A - Note
Exhibit B - Form of Money Market Quote Request
Exhibit C - Form of Invitation for Money Market Quotes
Exhibit D - Form of Money Market Quote
iii
<PAGE> 5
Exhibit E - Form of Alternative Currency Quote Request
Exhibit F - Form of Alternative Currency Quote
Exhibit G - Opinion of Jones, Day, Reavis & Pogue,
Special Counsel for the Borrower
Exhibit H - Opinion of Bergen I. Bull, Esq., General Counsel for
the Borrower
Exhibit I - Opinion of Davis Polk & Wardwell, Special Counsel
for the Agent
Exhibit J - Form of Assignment and Assumption Agreement
Exhibit K - Form of Extension Request
Exhibit L - Existing Liens
Exhibit M - Existing Investments
Exhibit N - Existing Accommodation Obligations
iv
<PAGE> 6
CREDIT AGREEMENT
AGREEMENT dated as of February 28, 1995 among NACCO MATERIALS
HANDLING GROUP, INC., the BANKS party hereto and MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent.
W I T N E S S E T H :
WHEREAS, the Borrower is a wholly-owned Subsidiary of Hyster-Yale
Materials Handling, Inc. ("Holdings");
WHEREAS, approximately 97% of the common stock of Holdings is
owned by NACCO Industries, Inc. ("NACCO Industries");
WHEREAS, Holdings, the Borrower, the banks party thereto and
Citicorp North America, Inc., as agent, are parties to an Amended and Restated
Credit Agreement dated as of July 30, 1993 (as amended from time to time, the
"Existing Credit Agreement") under which (i) revolving credit loans are
outstanding from time to time to the Borrower and (ii) term loans are
outstanding to Holdings;
WHEREAS, the Borrower desires to replace the Existing Credit
Agreement with this Agreement;
WHEREAS, Holdings desires to prepay (i) the term loans outstanding
to it under the Existing Credit Agreement and (ii) its outstanding Subordinated
Debentures, and to obtain the funds required for such prepayments from the
Borrower; and
WHEREAS, the Borrower desires to have available to it a revolving
credit facility in the aggregate amount of $350,000,000 pursuant to which it
may borrow the funds required (i) to enable Holdings to prepay said outstanding
term loans and Subordinated Debentures, (ii) to repay all revolving credit
loans outstanding to the Borrower under the Existing Credit Agreement and (iii)
to meet the working capital needs of the Borrower and its Subsidiaries and for
other general corporate purposes;
NOW, THEREFORE, the parties hereto agree as follows:
<PAGE> 7
ARTICLE 1
DEFINITIONS
SECTION 1.1. Definitions. The following terms, as used herein,
have the following meanings:
"Absolute Rate Auction" means a solicitation of Money Market
Quotes setting forth Money Market Absolute Rates pursuant to Section 2.4.
"Accommodation Obligation" means any obligation, contingent or
otherwise, of any Person directly or indirectly guaranteeing any Debt of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of)
such Debt (whether arising by virtue of partnership arrangements, by agreement
to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or
(ii) entered into for the purpose of assuring in any other manner the obligee
of such Debt of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided that the term "Accommodation
Obligation" shall not include endorsements for collection or deposit in the
ordinary course of business. For purposes hereof, the amount of any
Accommodation Obligation shall be deemed to be the principal amount of the Debt
which it guarantees or otherwise supports.
"Adjusted CD Rate" has the meaning set forth in Section 2.9(b).
"Administrative Questionnaire" means, with respect to each Bank,
an administrative questionnaire in the form prepared by the Agent and submitted
to the Agent (with a copy to the Borrower) duly completed by such Bank.
"Affiliate" means (i) any Person that directly, or indirectly
through one or more intermediaries, controls the Borrower (a "Controlling
Person"), (ii) any Person which is controlled by or is under common control
with a Controlling Person or (iii) any Person in which the Borrower or any
Controlling Person (or any Subsidiary of the Borrower or a Controlling Person)
has an investment that is reflected in the consolidated financial statements of
the Borrower or such Controlling Person under the equity method of accounting;
provided that the term "Affiliate" shall not include the Borrower or any
Subsidiary of the Borrower. As used herein, the term "control" means
possession, directly
2
<PAGE> 8
or indirectly, of the power to direct or cause the direction of the management
or policies of a Person, whether through the ownership of voting securities, by
contract or otherwise.
"Agent" means Morgan Guaranty Trust Company of New York in its
capacity as agent for the Banks hereunder, and its successors in such capacity.
"Alternative Currency" means any currency other than Dollars which
is freely transferable and convertible into Dollars.
"Alternative Currency Business Day" means, with respect to any
Alternative Currency Loan, a Euro-Dollar Business Day on which commercial banks
are open for international business (including the clearing of currency
transfers in the relevant Alternative Currency) in the principal financial
center of the home country of such Alternative Currency.
"Alternative Currency Lending Office" means, as to each Bank with
respect to each Alternative Currency Loan made by it, its office, branch or
affiliate identified in the relevant Alternative Currency Quote as its
Alternative Currency Lending Office for such Loan, or such other office, branch
or affiliate as such Bank may thereafter designate as its Alternative Currency
Lending Office for such Loan by notice to the Borrower.
"Alternative Currency Loan" means a loan to be made by a Bank in
an Alternative Currency pursuant to Section 2.5.
"Alternative Currency Loan Report" has the meaning set forth in
Section 2.5(g).
"Alternative Currency Quote" means an offer by a Bank to make an
Alternative Currency Loan in accordance with Section 2.5.
"Alternative Currency Quote Request" means a request,
substantially in the form of Exhibit E hereto, to be sent to the Banks by the
Borrower pursuant to Section 2.5(b), requesting Alternative Currency Quotes for
one or more proposed Alternative Currency Borrowings.
"Alternative Currency Rate" has the meaning set forth in Section
2.5(c).
"Applicable Lending Office" means, with respect to any Bank, (i)
in the case of its Domestic Loans, its Domestic Lending Office, (ii) in the
case of its Euro-Dollar
3
<PAGE> 9
Loans, its Euro-Dollar Lending Office, (iii) in the case of its Money Market
Loans, its Money Market Lending Office, and (iv) in the case of each of its
Alternative Currency Loans, its Alternative Currency Lending Office for such
Loan.
"Assessment Rate" has the meaning set forth in Section 2.9(b).
"Assignee" has the meaning set forth in Section 9.6(c).
"Average Debt Ratio" has the meaning set forth in the Pricing
Schedule.
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 9.6(c), and their respective
successors.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus
the Federal Funds Rate for such day.
"Base Rate Loan" means (i) a Committed Loan which bears interest
at the Base Rate pursuant to the applicable Notice of Committed Borrowing or
Notice of Interest Rate Election or the provisions of Article 8 or (ii) an
overdue amount which was a Base Rate Loan immediately before it became overdue.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means NACCO Materials Handling Group, Inc., a Delaware
corporation, and its successors.
"Borrowing" has the meaning set forth in Section 1.3.
"CD Base Rate" has the meaning set forth in Section 2.9(b).
"CD Loan" means (i) a Committed Loan which bears interest at a CD
Rate pursuant to the applicable Notice of Committed Borrowing or Notice of
Interest Rate Election or (ii) an overdue amount which was a CD Loan immediately
before it became overdue.
"CD Margin" means a rate per annum determined in accordance with
the Pricing Schedule.
4
<PAGE> 10
"CD Rate" means a rate of interest determined pursuant to Section
2.9(b) on the basis of an Adjusted CD Rate.
"CD Reference Banks" means Bank of America National Trust and
Savings Association, The Bank of Nova Scotia and Morgan Guaranty Trust Company
of New York.
"Closing Date" means the date on or after the Effective Date on
which the Agent shall have received all the items specified in or pursuant to
Section 3.1.
"Commitment" means (i) with respect to each Bank listed on the
signature pages hereof, the amount set forth opposite the name of such Bank on
said signature pages or (ii) with respect to any Assignee, the amount of the
transferor Bank's Commitment assigned to such Assignee pursuant to Section
9.6(c), in each case as such amount may be reduced from time to time pursuant
to Section 2.11 or changed as a result of an assignment pursuant to Section
9.6(c).
"Committed Loan" means a Loan made by a Bank pursuant to Section
2.1; provided that, if any such Loan or Loans (or portions thereof) are
combined or subdivided pursuant to a Notice of Interest Rate Election, the term
"Committed Loan" shall refer to the combined principal amount resulting from
such combination or to each of the separate principal amounts resulting from
such subdivision, as the case may be.
"Consolidated Capital Expenditures" means, for any Fiscal Year,
the gross amount of all additions to the property, plant and equipment or
similar fixed asset accounts of the Borrower and its Subsidiaries for such
Fiscal Year, excluding:
(i) the book value of any equipment traded in as part of the
consideration given to acquire new equipment;
(ii) expenditures made in connection with the replacement or
restoration of assets, to the extent reimbursed or financed from insurance
proceeds paid on account of the loss of or damage to the assets being
replaced or restored, or from awards of compensation arising from the
taking by condemnation or eminent domain of such assets being replaced;
(iii) expenditures in connection with the acquisition by the
Borrower of rental units for its rental fleet; and
5
<PAGE> 11
(iv) an amount equal to all cash reimbursements actually received
by the Borrower and its Subsidiaries during such Fiscal Year from any
governmental body or agency in connection with grants for capital
expenditures.
"Consolidated EBITDA" means, for any period, (a) Consolidated Net
Income for such period, plus (b) to the extent deducted in determining
Consolidated Net Income for such period, the aggregate amount of (i)
depreciation and amortization expense, (ii) Consolidated Interest Expense,
(iii) foreign, federal, state and local income taxes, (iv) extraordinary
losses, (v) equity in losses of unconsolidated Subsidiaries and Affiliates and
(vi) accruals for long-term deferred compensation (net of cash payments of
deferred compensation accrued in prior periods) minus (c) to the extent
included in determining Consolidated Net Income for such period, (vii)
extraordinary gains and (viii) equity in earnings of unconsolidated
Subsidiaries and Affiliates for such period.
"Consolidated Interest Expense" means, for any period, the
consolidated interest expense of the Borrower and its Subsidiaries for such
period; provided that (i) for any period prior to the Holdings Merger, such
Consolidated Interest Expense shall be calculated with respect to Holdings and
its Subsidiaries on a consolidated basis and (ii) Consolidated Interest Expense
shall not include any premium paid in connection with the redemption of the
Subordinated Debentures, any amortization of such premium or any amortization
of deferred financing fees.
"Consolidated Net Income" means, for any period, the consolidated
net income (or loss) of the Borrower and its Subsidiaries for such period
(taken as a single accounting period); provided that, for any period prior to
the Holdings Merger, such Consolidated Net Income shall be determined with
respect to Holdings and its Subsidiaries on a consolidated basis.
"Consolidated Net Worth" means, at any date, the sum of (x) the
consolidated stockholders' equity of the Borrower and its Subsidiaries
determined as of such date (excluding any amount attributable to stock which is
required to be redeemed or is redeemable at the option of the holder, if
specified events or conditions occur or exist or otherwise) plus (y) the Foreign
Currency Translation Adjustment (which may be a positive or a negative number);
provided that, at any date prior to the Holdings Merger, Consolidated Net Worth
shall be determined with respect to Holdings and its Subsidiaries on a
consolidated basis.
6
<PAGE> 12
"Debt" of any Person means, at any date, without duplication, (i)
all obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable and accrued expenses
arising in the ordinary course of business but only if and so long as the same
are payable on conventional terms (not exceeding 270 days), are not overdue by
more than 90 days or are being contested in good faith, (iv) all obligations of
such Person as lessee under capital leases, (v) all non-contingent obligations
of such Person to reimburse any bank or other Person in respect of amounts paid
under a letter of credit or similar instrument and (vi) all obligations of the
foregoing types secured by a Lien on any asset of such Person, whether or not
the obligations so secured are otherwise obligations of such Person; provided
that the term "Debt" shall not include obligations under the Tax Sharing
Agreement.
"Debt Ratio" means, at any time, the ratio of (i) Total Debt at
such time to (ii) Total Capital at such time.
"Default" means any condition or event which constitutes an Event
of Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Dollar-Denominated" means (i) when used with respect to a Loan,
that such Loan was made or is to be made in Dollars and (ii) when used with
respect to a Borrowing, that such Borrowing is comprised of Loans made or to be
made in Dollars.
"Dollar Equivalent" means, with respect to any Alternative Currency
Loan at any time, the amount of Dollars that would be obtained by converting the
then outstanding principal amount of such Alternative Currency Loan into Dollars
at the spot rate for the purchase of Dollars with the relevant Alternative
Currency as quoted by the Agent at approximately 9:30 A.M. (New York City time)
on the second Alternative Currency Business Day prior to the date on which such
Alternative Currency Loan was made. Whenever a percentage of the aggregate
outstanding principal amount of the Loans is to be calculated hereunder,
Alternative Currency Loans shall be included in such calculation at their
respective Dollar Equivalents.
"Dollars" and the sign "$" mean lawful money of the United States.
7
<PAGE> 13
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York City are authorized by law to
close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending Office)
or such other office as such Bank may hereafter designate as its Domestic
Lending Office by notice to the Borrower and the Agent; provided that any Bank
may so designate separate Domestic Lending Offices for its Base Rate Loans, on
the one hand, and its CD Loans, on the other hand, in which case all references
herein to the Domestic Lending Office of such Bank shall be deemed to refer to
either or both of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in Section
2.9(b).
"Effective Date" means the date this Agreement becomes effective
in accordance with Section 9.12.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating
to the environment, the effect of the environment on human health or to
emissions, discharges or releases of pollutants, contaminants, Hazardous
Substances or wastes into the environment including, without limitation,
ambient air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, Hazardous Substances or
wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all members
of a controlled group of corporations and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
8
<PAGE> 14
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Borrower and the Agent.
"Euro-Dollar Loan" means (i) a Committed Loan which bears interest
at a Euro-Dollar Rate pursuant to the applicable Notice of Committed Borrowing
or Notice of Interest Rate Election or (ii) an overdue amount which was a
Euro-Dollar Loan immediately before it became overdue.
"Euro-Dollar Margin" means a rate per annum determined in
accordance with the Pricing Schedule.
"Euro-Dollar Rate" means a rate of interest determined pursuant to
Section 2.9(c) on the basis of a London Interbank Offered Rate.
"Euro-Dollar Reference Banks" means the principal London offices
of Bank of America National Trust and Savings Association, The Bank of Nova
Scotia and Morgan Guaranty Trust Company of New York.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents).
"Event of Default" has the meaning set forth in Section 6.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
9
<PAGE> 15
"Existing Credit Agreement" has the meaning set forth in the third
WHEREAS clause at the beginning of this Agreement.
"Existing Guaranties" means collectively (i) the Holdings
Guaranty, (ii) the New Nacq I Guaranty, (iii) the Yale Intercompany Guaranty
and (iv) the Hyster Intercompany Guaranty, as each of such terms is defined in
the Existing Credit Agreement.
"Existing Security Agreements" means the Security Agreements and
the Pledge Agreements, as each of such terms is defined in the Existing Credit
Agreement.
"Existing Term Loans" means the term loans to Holdings outstanding
under the Existing Credit Agreement.
"Extending Bank" means, in connection with any extension of
Termination Dates pursuant to Section 2.2, any Bank that agrees to such
extension.
"Facility Fee Rate" means a rate per annum determined in
accordance with the Pricing Schedule.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate
on such transactions on the next preceding Domestic Business Day as so
published on the next succeeding Domestic Business Day, and (ii) if no such
rate is so published on such next succeeding Domestic Business Day, the Federal
Funds Rate for such day shall be the average rate quoted to Morgan Guaranty
Trust Company of New York on such day on such transactions as determined by the
Agent.
"Final Termination Date" means February 28, 2000 or, if Banks
having at least 75% of the aggregate amount of the Commitments shall have
extended their respective Termination Dates pursuant to Section 2.2, the latest
date to which any of the Commitments shall have been so extended.
"Fiscal Quarter" means (i) for any period prior to the Holdings
Merger, a fiscal quarter of Holdings and (ii) for any period after the Holdings
Merger, a fiscal quarter of the Borrower.
10
<PAGE> 16
"Fiscal Year" means (i) for any period prior to the Holdings
Merger, a fiscal year of Holdings and (ii) for any period after the Holdings
Merger, a fiscal year of the Borrower.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money
Market Loans (excluding Money Market LIBOR Loans bearing interest at the Base
Rate pursuant to Section 8.1) or Alternative Currency Loans or any combination
of the foregoing.
"Foreign Currency Translation Adjustment" means, at any date, the
amount, either positive or negative, obtained by subtracting the cumulative
foreign currency translation adjustment at such date from $10,511,000.
"GAAP" means at any time generally accepted accounting principles
as then in effect in the United States, applied on a basis consistent (except
for changes with which the Borrower's independent public accountants have
concurred) with the most recent audited consolidated financial statements of
the Borrower and its Subsidiaries theretofore delivered to the Banks (or, if no
audited financial statements of the Borrower and its Subsidiaries have been so
delivered, the most recent audited consolidated financial statements of
Holdings and its Subsidiaries theretofore delivered to the Banks).
"Group of Loans" means at any time a group of Committed Loans
consisting of (i) all Committed Loans which are Base Rate Loans at such time,
(ii) all Euro-Dollar Loans having the same Interest Period at such time or
(iii) all CD Loans having the same Interest Period at such time, provided that,
if a Committed Loan of any particular Bank is converted to or made as a Base
Rate Loan pursuant to Article 8, such Loan shall be included in the same Group
or Groups of Loans from time to time as it would have been in if it had not
been so converted or made.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives,
by-products and other hydrocarbons, or any substance having any constituent
elements displaying any of the foregoing characteristics.
"Holdings" means Hyster-Yale Materials Handling Inc., a Delaware
corporation, and its successors.
"Holdings' Latest Form 10-Q" means Holdings' quarterly report on
Form 10-Q for the quarter ended September 30, 1994, as filed with the SEC
pursuant to the Exchange Act.
11
<PAGE> 17
"Holdings Merger" means a merger of Holdings and the Borrower, in
which the Borrower is the surviving corporation.
"Holdings' 1993 Form 10-K" means Holdings' annual report on Form
10-K for its fiscal year ended December 31, 1993, as filed with the SEC
pursuant to the Exchange Act.
"Indemnitee" has the meaning set forth in Section 9.3(b).
"Interest Coverage Ratio" means, at the end of any Fiscal Quarter,
the ratio of (i) Consolidated EBITDA for the period of four consecutive Fiscal
Quarters then ended to (ii) Consolidated Interest Expense for such period.
"Interest Period" means: (1) with respect to each Euro-Dollar
Loan of each Bank, the period commencing on the date of borrowing specified in
the applicable Notice of Borrowing or on the date specified in the applicable
Notice of Interest Rate Election and ending one, two, three or six months
thereafter, as the Borrower may elect in the applicable Notice; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after such
Bank's Termination Date shall end on such Bank's Termination Date.
(2) with respect to each CD Loan of each Bank, the period
commencing on the date of borrowing specified in the applicable Notice of
Borrowing or on the date specified in the applicable Notice of Interest Rate
Election and ending 30, 60, 90 or 180 days thereafter, as the Borrower may
elect in the applicable notice; provided that:
(a) any Interest Period (other than an Interest Period determined
pursuant to clause (b) below) which would otherwise end on a day which is
not a Euro-Dollar
12
<PAGE> 18
Business Day shall be extended to the next succeeding Euro-Dollar Business
Day; and
(b) any Interest Period which would otherwise end after such
Bank's Termination Date shall end on such Bank's Termination Date.
(3) with respect to each Money Market LIBOR Loan of each Bank,
the period commencing on the date of borrowing specified in the applicable
Notice of Borrowing and ending such whole number of months thereafter as the
Borrower may elect in accordance with Section 2.4; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after such
Bank's Termination Date shall end on such Bank's Termination Date.
(4) with respect to each Money Market Absolute Rate Loan of each
Bank, the period commencing on the date of borrowing specified in the applicable
Notice of Borrowing and ending such number of days thereafter (but not less than
7 days) as the Borrower may elect in accordance with Section 2.4; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after such
Bank's Termination Date shall end on such Bank's Termination Date.
(5) with respect to each Alternative Currency Loan of each
Bank, the period commencing on the date such Loan is made and ending on the
date specified by the Borrower in the applicable Alternative Currency Quote
Request; provided that:
13
<PAGE> 19
(a) any Interest Period which would otherwise end on a day which
is not an Alternative Currency Business Day shall be extended to the next
succeeding Alternative Currency Business Day; and
(b) any Interest Period which would otherwise end after such
Bank's Termination Date shall end on such Bank's Termination Date.
"Interest Rate Contracts" means interest rate swap agreements,
interest rate cap agreements or other financial agreements or arrangements
intended to provide protection against changes in interest rates.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended, or any successor statute.
"Investment" means, as applied to any Person, (i) any purchase or
other acquisition by such Person of any direct or indirect equity interest in
any other Person or any Debt of any other Person (including, without
limitation, Debt acquired by making a loan to such other Person), (ii) any
right to acquire any such equity interest or Debt or (iii) any capital
contribution by such Person to any other Person; provided that the term
"Investment" shall not include (x) deposits with financial institutions
available for withdrawal on demand, (y) prepaid expenses, advances to employees
and similar items made or incurred in the ordinary course of business or (z)
advances pursuant to the Tax Sharing Agreement.
"Invitation for Money Market Quotes" means an invitation,
substantially in the form of Exhibit C hereto, to be sent to the Banks by the
Agent at the Borrower's request pursuant to Section 2.4(c), requesting offers
by the Banks to make Money Market Loans.
"LIBOR Auction" means a solicitation of Money Market Quotes
setting forth Money Market Margins based on the London Interbank Offered Rate
pursuant to Section 2.4.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind, or any other type
of preferential arrangement that has the practical effect of creating a
security interest, in respect of such asset. For purposes of this Agreement,
the Borrower or any Subsidiary shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a vendor or
lessor under any conditional sale agreement, capital lease or other title
retention agreement relating to such asset.
14
<PAGE> 20
"Loan" means a Domestic Loan, a Euro-Dollar Loan, a Money Market
Loan or an Alternative Currency Loan and "Loans" means Domestic Loans,
Euro-Dollar Loans, Money Market Loans or Alternative Currency Loans or any
combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.9(c).
"Material Debt" means Debt (other than the Notes) and
non-contingent Accommodation Obligations of the Borrower and/or one or more of
its Subsidiaries, arising in one or more related or unrelated transactions, in
an aggregate principal amount exceeding $10,000,000.
"Material Plan" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $5,000,000.
"Money Market Absolute Rate" has the meaning set forth in Section
2.4(d).
"Money Market Absolute Rate Loan" means a loan made or to be made
by a Bank pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its Domestic
Lending Office or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Money Market Lending Office by notice to the Borrower
and the Agent; provided that any Bank may from time to time by notice to the
Borrower and the Agent designate separate Money Market Lending Offices for its
Money Market LIBOR Loans, on the one hand, and its Money Market Absolute Rate
Loans, on the other hand, in which case all references herein to the Money
Market Lending Office of such Bank shall be deemed to refer to either or both of
such offices, as the context may require.
"Money Market LIBOR Loan" means a loan made or to be made by a
Bank pursuant to a LIBOR Auction (including such a loan bearing interest at the
Base Rate pursuant to Section 8.1).
"Money Market Loan" means a Money Market LIBOR Loan or a Money
Market Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.4(d)(ii)(C).
"Money Market Quote" means an offer by a Bank to make a Money
Market Loan in accordance with Section 2.4.
15
<PAGE> 21
"Money Market Quote Request" means a request, substantially in the
form of Exhibit B hereto, to be sent to the Agent by the Borrower pursuant to
Section 2.4(b), requesting Money Market Quotes for one or more proposed Money
Market Borrowings.
"Multiemployer Plan" means at any time an employee pension benefit
plan within the meaning of Section 4001(a)(3) of ERISA to which any member of
the ERISA Group is then making or accruing an obligation to make contributions
or has within the preceding five plan years made contributions, including for
these purposes any Person which ceased to be a member of the ERISA Group during
such five year period.
"NACCO Industries" means NACCO Industries, Inc., a Delaware
corporation, and its successors.
"Non-Extending Bank" means, in connection with any extension of
Termination Dates pursuant to Section 2.2, a Bank that does not agree to such
extension.
"Notes" means promissory notes of the Borrower, substantially in
the form of Exhibit A hereto, evidencing the obligation of the Borrower to
repay the Loans, and "Note" means any one of such promissory notes issued
hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.3) or a Notice of Money Market Borrowing (as defined in
Section 2.4(f)) or a Notice of Alternative Currency Borrowing (as defined in
Section 2.5(d)).
"Notice of Interest Rate Election" has the meaning set forth in
Section 2.12.
"Operating Agreements" means:
(i) the arrangements and agreements between the Borrower and AT&T
Commercial Finance Corporation pursuant to (a) the Third Amended and
Restated Operating Agreement dated as of November 21, 1985, as amended from
time to time, and (b) the Second Amended and Restated Operating Agreement
dated as of February 16, 1984, as amended from time to time and
(ii) the arrangements and agreements between the Borrower, Yale
Financial Services, Inc. and General Electric Capital Corporation pursuant
to (a) the Joint Venture and Shareholders Agreement dated November 8, 1989,
as amended from time to time, (b) the Remarketing Services Agreement dated
November 8, 1989, as amended
16
<PAGE> 22
from time to time, (c) the Guaranty in favor of General Electric Capital
Corporation dated November 8, 1989, as amended from time to time, (d) the
Letter Agreement made in connection with the Administrative Services
Agreement dated November 8, 1989, as amended from time to time, (e) the
Letter Agreement made in connection with any guaranties which may be
provided by the Borrower to either Yale Financial Services, Inc. or General
Electric Capital Corporation dated November 8, 1989, as amended from time to
time, (f) the Capital Contribution Agreement dated November 29, 1989 as
amended from time to time, and (g) the Guaranty and Indemnity Agreement
dated June 30, 1988, as amended from time to time.
"Parent" means, with respect to any Bank, any Person controlling
such Bank.
"Participant" has the meaning set forth in Section 9.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Internal Revenue Code
and either (i) is maintained, or contributed to, by any member of the ERISA
Group for employees of any member of the ERISA Group or (ii) has at any time
within the preceding five years been maintained, or contributed to, by any
Person which was at such time a member of the ERISA Group for employees of any
Person which was at such time a member of the ERISA Group.
"Pricing Level" refers to the determination of which of Pricing
Level I, Pricing Level II, Pricing Level III, Pricing Level IV or Pricing Level
V (as each of such terms is defined in the Pricing Schedule) applies on any
day.
"Pricing Schedule" means the Pricing Schedule attached hereto.
17
<PAGE> 23
"Prime Rate" means the rate of interest publicly announced by
Morgan Guaranty Trust Company of New York in New York City from time to time as
its Prime Rate.
"Quarterly Date" means any March 31, June 30, September 30 or
December 31.
"Rate Period" has the meaning set forth in the Pricing Schedule.
"Reference Banks" means the CD Reference Banks or the Euro-Dollar
Reference Banks, as the context may require, and "Reference Bank" means any one
of such Reference Banks.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Replaced Bank" has the meaning set forth in Section 8.6(a).
"Required Banks" means at any time Banks having more than 50% of
the aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Notes evidencing more than 50% of the aggregate unpaid
principal amount of the Loans.
"Responsible Officer" means, with respect to the Borrower or any
Subsidiary, its chairman, its president, any of its vice presidents who are
corporate officers or any comparable officer.
"Restricted Payment" means (i) any dividend or other distribution
on any shares of the capital stock of the Borrower or Holdings (except
dividends payable solely in shares of such capital stock) or (ii) any payment
on account of the purchase, redemption, retirement or acquisition of (a) any
shares of such capital stock or (b) any option, warrant or other right to
acquire shares of such capital stock; provided that the term "Restricted
Payment" shall not include (x) payments of fees and allocated expenses to NACCO
Industries not exceeding $2,500,000 in any Fiscal Year or (y) any payment made
with respect to convertible debt securities prior to conversion.
"SEC" means the United States Securities and Exchange Commission.
"Specified Covenant Release Date" means the last day of any Fiscal
Quarter if, but only if, (i) the Interest Coverage Ratio is equal to or higher
than 4.5 to 1 at the end of such Fiscal Quarter and also at the end of the
immediately preceding Fiscal Quarter and (ii) the Average
18
<PAGE> 24
Debt Ratio is less than 0.37 to 1 for each of said two consecutive Fiscal
Quarters.
"Subordinated Debentures" means the 12.375% Senior Subordinated
Debentures due 1999 issued by Holdings and outstanding at December 31, 1994 in
the aggregate principal amount of $78,524,000.
"Subsidiary" means, as to any Person, any corporation or other
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are at the time directly or indirectly owned by such Person.
Unless otherwise specified, "Subsidiary" means a Subsidiary of the Borrower.
"Substitute Bank" has the meaning set forth in Section 8.6(a).
"Sumitomo-Yale" means Sumitomo Yale Company Limited, a joint
venture in Japan between the Borrower and Sumitomo Heavy Industries Ltd.
"Sumitomo-Yale Investments" means, for any Fiscal Year, the
aggregate amount of all Investments made by Holdings, the Borrower and the
Borrower's Subsidiaries in Sumitomo-Yale during such Fiscal Year.
"Tax Sharing Agreement" means the Tax Sharing Agreement dated as
of October 12, 1990 (the "Existing Tax Sharing Agreement") among NACCO
Industries and certain of its affiliates (including the Borrower and its
Subsidiaries) providing for the allocation of United States federal income tax
liability and related intercompany payments; provided that the Existing Tax
Sharing Agreement may be replaced at any time by an Amended Tax Sharing
Agreement substantially in the form heretofore delivered to each of the Banks,
in which case the term "Tax Sharing Agreement" shall refer to such Amended Tax
Sharing Agreement with respect to all periods ending after the effective date
thereof and to the Existing Tax Sharing Agreement with respect to all periods
ending on or before such effective date.
"Temporary Cash Investment" means any Investment in (i) direct
obligations of the United States or any agency thereof, or obligations
guaranteed by the United States or any agency thereof, (ii) commercial paper
rated at least A-1 by Standard & Poor's Ratings Group or P-1 by Moody's
Investors Service, Inc., (iii) time deposits with, including certificates of
deposit issued by, any office located in the United States of any Bank, or any
other bank or trust company which is organized under the laws of the United
States or any state thereof and has capital, surplus and
19
<PAGE> 25
undivided profits aggregating at least $1,000,000,000, (iv) repurchase
agreements with respect to securities described in clause (i) above entered into
with an office of any Bank, or any other bank or trust company meeting the
criteria specified in clause (iii) above, or (v) in the case of any Subsidiary
located in a jurisdiction outside the United States, Investments in such
jurisdiction that are comparable in nature and credit quality to the Investments
described in clauses (i) through (iv) above, provided in each case that such
Investment matures within one year from the date of acquisition thereof by the
Borrower or a Subsidiary.
"Termination Date" means, with respect to each Bank, February 28,
2000 or such later date, if any, to which such Bank shall have extended its
Termination Date pursuant to Section 2.2; provided that, if any such day is not
a Euro-Dollar Business Day, such Bank's Termination Date shall be the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day falls
in another calendar month, in which case such Bank's Termination Date shall be
the next preceding Euro-Dollar Business Day.
"Total Capital" means, at any date, the sum of (i) Total Debt at
such date and (ii) Consolidated Net Worth at such date.
"Total Debt" means, at any date, the consolidated Debt of the
Borrower and its Subsidiaries at such date; provided that, at any date prior to
the Holdings Merger, Total Debt shall be determined with respect to Holdings
and its Subsidiaries on a consolidated basis.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the value of all benefit liabilities
under such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA
Group to the PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the
States and the District of Columbia, but excluding its territories and
possessions.
SECTION 1.2. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements
20
<PAGE> 26
required to be delivered hereunder shall be prepared in accordance with GAAP as
in effect from time to time; provided that, if the Borrower notifies the Agent
that the Borrower wishes to amend any covenant in Article 5 to eliminate the
effect of any change in GAAP on the operation of such covenant (or if the Agent
notifies the Borrower that the Required Banks wish to amend Article 5 for such
purpose), then the Borrower's compliance with such covenant shall be determined
on the basis of GAAP as in effect immediately before the relevant change in GAAP
became effective, until either such notice is withdrawn or such covenant is
amended in a manner satisfactory to the Borrower and the Required Banks.
SECTION 1.3. Types of Borrowings. The term "Borrowing" denotes
the aggregation of Loans of one or more Banks to be made to the Borrower
pursuant to Article 2 on the same date, all of which Loans are of the same type
(subject to Article 8) and, except in the case of Base Rate Loans, have the same
initial Interest Period. Borrowings are classified for purposes of this
Agreement either by reference to the pricing of Loans comprising such Borrowing
(e.g., a "Euro-Dollar Borrowing" is a Borrowing comprised of Euro-Dollar Loans)
or by reference to the provisions of Article 2 under which participation therein
is determined (e.g., a "Committed Borrowing" is a Borrowing under Section 2.1 in
which all Banks participate in proportion to their Commitments, while a "Money
Market Borrowing" is a Borrowing under Section 2.4 in which the Bank
participants are determined by the Agent on the basis of their bids).
ARTICLE 2
THE CREDITS
SECTION 2.1. Commitments to Lend. Each Bank severally agrees, on
the terms and conditions set forth in this Agreement, to make
Dollar-Denominated loans to the Borrower pursuant to this Section from time to
time prior to such Bank's Termination Date; provided that the aggregate
principal amount of Committed Loans by such Bank at any one time outstanding
shall not exceed the amount of its Commitment. Each Borrowing under this
Section shall be in an aggregate principal amount of at least $10,000,000
(except that any such Borrowing may be in the aggregate amount available in
accordance with Section 3.2(c)) and shall be made from the several Banks
ratably in proportion to their respective Commitments. Within the foregoing
limits, the Borrower may borrow under this Section, prepay Loans to the extent
permitted by Section 2.14, and reborrow
21
<PAGE> 27
at any time prior to the Final Termination Date under this Section.
SECTION 2.2. Extension of Termination Dates. Each Bank's
Termination Date may be extended, in the manner set forth in this Section, on
June 30, 1996 and on each anniversary of such date (each an "Extension Date"),
in each case to a date one year after such Bank's Termination Date provided for
herein immediately before such extension. If the Borrower wishes to request an
extension of the Termination Dates on any Extension Date, it shall send a
request for such extension (an "Extension Request"), in substantially the form
of Exhibit K hereto, to each Bank not less than 30 nor more than 60 days prior
to such Extension Date. Each Bank that is willing to extend its Termination
Date as requested by the Borrower will use its best efforts to sign and deliver
such Extension Request to the Agent before such Extension Date. If the Agent
receives, before such Extension Date, copies of said Extension Request signed
by Banks having at least 75% of the aggregate amount of Commitments, (i) the
Termination Date of each Bank that signs such Extension Request shall be
extended to the date specified in such Extension Request, (ii) the Agent shall
notify the Borrower and the Banks of the extension of such Termination Dates
and (iii) the Agent shall notify the Borrower and the Banks of the identity of
each Non- Extending Bank, if any. The Borrower shall have the right at any
time to replace any Non-Extending Bank with one or more Substitute Banks as
provided in Section 8.6.
SECTION 2.3. Notice of Committed Borrowing. (a) The Borrower
shall give the Agent notice (a "Notice of Committed Borrowing") not later than
10:30 A.M. (New York City time) on (x) the date of each Base Rate Borrowing,
(y) the second Domestic Business Day before each CD Borrowing and (z) the third
Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Domestic Borrowing or a Euro-Dollar Business
Day in the case of a Euro-Dollar Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) whether the Loans comprising such Borrowing are to bear
interest initially at the Base Rate, a CD Rate, or a Euro-Dollar Rate; and
(iv) in the case of a Fixed Rate Borrowing, the duration of the
initial Interest Period applicable thereto, subject to the provisions of
the definition of Interest Period.
22
<PAGE> 28
Notwithstanding the foregoing, the total number of Groups of Loans at any one
time outstanding shall not exceed fifteen.
SECTION 2.4. Money Market Borrowings. (a) The Money Market
Option. In addition to Committed Borrowings pursuant to Section 2.1, the
Borrower may, as set forth in this Section, request the Banks to make offers to
make Dollar-Denominated Money Market Loans to the Borrower from time to time
prior to the Final Termination Date. Any Bank may, but shall have no
obligation to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers as set forth in this Section.
(b) Money Market Quote Request. When the Borrower wishes to
request offers to make Money Market Loans under this Section, it shall transmit
to the Agent by facsimile transmission a Money Market Quote Request so as to be
received not later than 10:30 A.M. (New York City time) on (x) the fifth
Euro-Dollar Business Day prior to the date of Borrowing proposed therein, in the
case of a LIBOR Auction or (y) the Domestic Business Day next preceding the date
of Borrowing proposed therein, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective) specifying:
(i) the proposed date of Borrowing, which shall be a Euro-Dollar
Business Day in the case of a LIBOR Auction or a Domestic Business Day in
the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be at
least $5,000,000,
(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set forth a
Money Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
23
<PAGE> 29
(c) Invitation for Money Market Quotes. Promptly upon receipt of
a Money Market Quote Request, the Agent shall send to the Banks by telex or
facsimile transmission an Invitation for Money Market Quotes, which shall
constitute an invitation by the Borrower to each Bank to submit Money Market
Quotes offering to make the Money Market Loans to which such Money Market Quote
Request relates in accordance with this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each
Bank may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes; provided
that a Non-Extending Bank may not make such an offer if the Interest Period
specified by the Borrower ends after such Bank's Termination Date. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Agent by telex or facsimile transmission at its office
referred to in Section 9.1 not later than (x) 2:00 P.M. (New York City time) on
the fourth Euro-Dollar Business Day prior to the proposed date of Borrowing, in
the case of a LIBOR Auction or (y) 9:30 A.M. (New York City time) on the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective); provided that Money Market
Quotes submitted by the Agent (or any affiliate of the Agent) in the capacity of
a Bank may be submitted, and may only be submitted, if the Agent or such
affiliate notifies the Borrower of the terms of the offer or offers contained
therein not later than (x) one hour prior to the deadline for the other Banks,
in the case of a LIBOR Auction or (y) 15 minutes prior to the deadline for the
other Banks, in the case of an Absolute Rate Auction. Subject to Articles 3 and
6, any Money Market Quote so made shall be irrevocable except with the written
consent of the Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form
of Exhibit D hereto and shall in any case specify:
(A) the date of the proposed Borrowing,
(B) the principal amount of the Money Market Loan for which each
such offer is being made, which principal amount (w) may be greater than or
less than the Commitment of the quoting Bank, (x) must be $5,000,000 or a
larger multiple of $1,000,000, (y) may not exceed the principal amount of
Money Market Loans
24
<PAGE> 30
for which offers were requested and (z) may be subject to an aggregate
limitation as to the principal amount of Money Market Loans for which offers
being made by such quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the margin above or below the
applicable London Interbank Offered Rate (the "Money Market Margin")
offered for each such Money Market Loan, expressed as a percentage
(specified to the nearest 1/10,000th of 1%) to be added to or subtracted
from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of interest
per annum (specified to the nearest 1/10,000th of 1%) (the "Money Market
Absolute Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D hereto or
does not specify all of the information required by subsection (d)(ii);
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set forth
in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) Notice to Borrower. The Agent shall promptly notify the
Borrower of the terms (x) of any Money Market Quote submitted by a Bank that is
in accordance with subsection (d) and (y) of any Money Market Quote that
amends, modifies or is otherwise inconsistent with a previous Money Market
Quote submitted by such Bank with respect to the same Money Market Quote
Request. Any such subsequent Money Market Quote shall be disregarded by the
Agent unless such subsequent Money Market Quote is submitted solely to correct
a manifest error in such former Money Market Quote. The Agent's notice to the
Borrower shall specify (A) the aggregate principal amount of Money Market
25
<PAGE> 31
Loans for which offers have been received for each Interest Period specified in
the related Money Market Quote Request, (B) the respective principal amounts and
Money Market Margins or Money Market Absolute Rates, as the case may be, so
offered and (C) if applicable, limitations on the aggregate principal amount of
Money Market Loans for which offers in any single Money Market Quote may be
accepted.
(f) Acceptance and Notice by Borrower. Not later than 10:30 A.M.
(New York City time) on (x) the third Euro-Dollar Business Day prior to the
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the proposed
date of Borrowing, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrower and the Agent shall have mutually agreed
and shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective), the Borrower shall notify the Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money
Market Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money Market Borrowing
may not exceed the applicable amount set forth in the related Money Market
Quote Request;
(ii) the principal amount of each Money Market Borrowing must be at
least $5,000,000;
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Absolute Rates, as the
case may be; and
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the requirements
of this Agreement.
(g) Allocation by Agent. If offers are made by two or more Banks
at the same Money Market Margins or Money Market Absolute Rates, as the case
may be, for a greater aggregate principal amount than the amount in respect of
which such offers are accepted for the related Interest Period, the principal
amount of Money Market Loans in respect of which such offers are accepted shall
be allocated by the Agent among such Banks as nearly as possible (in multiples
of $1,000,000 as the Agent may deem appropriate) in proportion to the principal
amounts of such offers.
26
<PAGE> 32
Determinations by the Agent of the amounts of Money Market Loans shall be
conclusive in the absence of manifest error.
SECTION 2.5. Alternative Currency Borrowings.
(a) Alternative Currency Option. In addition to Committed
Borrowings pursuant to Section 2.1 and Money Market Borrowings pursuant to
Section 2.4, the Borrower may, as set forth in this Section, request the Banks
to make offers to make Alternative Currency Loans to the Borrower from time to
time prior to the Final Termination Date. Any Bank may, but shall have no
obligation to, make such offers, and the Borrower may, but shall have no
obligation to, accept any such offers as set forth in this Section.
(b) Alternative Currency Quote Request. When the Borrower wishes
to request offers to make Alternative Currency Loans under this Section, it
shall transmit to each Bank by facsimile transmission an Alternative Currency
Quote Request so as to be received no later than 1:30 P.M. (New York City Time)
on the third Alternative Currency Business Day prior to the date of Borrowing
proposed therein (or such other time or date as the Borrower and the Agent
shall have mutually agreed and shall have notified to the Banks not later than
the date of the Alternative Currency Quote Request for the first Alternative
Currency Borrowing for which such change is to be effective) specifying:
(i) the Alternative Currency in which such Borrowing is
requested;
(ii) the proposed date of such Borrowing, which shall be an
Alternative Currency Business Day with respect to such Alternative
Currency;
(iii) the aggregate principal amount of such Borrowing (in such
Alternative Currency); and
(iv) the duration of the Interest Period applicable to such
Borrowing, subject to the provisions of the definition of Interest Period.
The Borrower may request offers to make Alternative Currency Loans with more
than one Interest Period in a single Alternative Currency Quote Request. No
Alternative Currency Quote Request shall be given within five Alternative
Currency Business Days (or such other number of days as the Borrower and the
Agent may agree) of any other Alternative Currency Quote Request.
(c) Submission and Contents of Alternative Currency Quotes. (i)
Each Bank may submit to the Borrower an Alternative Currency Quote containing
an offer or offers
27
<PAGE> 33
to make Alternative Currency Loans in response to an Alternative Currency Quote
Request; provided that a Non-Extending Bank may not make such an offer if the
Interest Period specified by the Borrower ends after such Bank's Termination
Date. Each Alternative Currency Quote must comply with the requirements of this
subsection (c) and must be submitted to the Borrower by facsimile transmission
at its office referred to in Section 9.1 not later than 6:30 A.M. (Portland,
Oregon time) on the second Alternative Currency Business Day preceding the
proposed date of the Alternative Currency Borrowing (or such other time or date
as the Borrower and the Agent shall have mutually agreed and shall have notified
to the Banks not later than the date of the Alternative Currency Quote Request
for the first Alternative Currency Loan for which such change is to be
effective).
(ii) Each Alternative Currency Quote shall be in substantially
the form of Exhibit F hereto and shall in any case specify:
(A) the date of the proposed Borrowing,
(B) the principal amount of the Alternative Currency Loan for
which each such offer is being made, which principal amount (x) may be
greater than or less than the Commitment of the quoting Bank, (y) may not
exceed the principal amount of Alternative Currency Loans for which offers
were requested and (z) may be subject to an aggregate limitation as to the
principal amount of Alternative Currency Loans for which offers being made
by such quoting Bank may be accepted,
(C) the rate of interest per annum (specified to the nearest
1/10,000th of 1%) (the "Alternative Currency Rate") offered for each such
Alternative Currency Loan, and
(D) the identity of the quoting Bank.
An Alternative Currency Quote may set forth up to five separate offers by the
quoting Bank with respect to each Interest Period specified in the related
Alternative Currency Quote Request.
(iii) Any Alternative Currency Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit F hereto or
does not specify all of the information required by subsection (c)(ii);
28
<PAGE> 34
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set forth
in the applicable Alternative Currency Quote Request; or
(D) arrives after the time set forth in subsection (c)(i).
(d) Acceptance and Notice by Borrower. Not later than 7:30 A.M.
(Portland, Oregon time) on the second Alternative Currency Business Day
preceding the proposed date of any Alternative Currency Borrowing (or such
other time or date as the Borrower and the Agent shall have mutually agreed and
shall have notified to the Banks not later than the date of the Alternative
Currency Request for the first Alternative Currency Loan for which such change
is to be effective), the Borrower shall notify each of the Banks which
submitted an Alternative Currency Quote of its acceptance or non-acceptance of
the offers so notified to it pursuant to subsection (c). In the case of
acceptance, such notice (a "Notice of Alternative Currency Borrowing") shall
specify the amount of each such offer that it accepts for each Interest Period.
The Borrower may accept any such offer in whole or in part; provided that:
(i) the aggregate principal amount of each Alternative Currency
Borrowing may not exceed the applicable amount set forth in the related
Alternative Currency Quote Request;
(ii) acceptance of offers may only be made on the basis of
ascending Alternative Currency Rates, as the case may be; and
(iii) the Borrower may not accept any offer that would cause the
aggregate Dollar Equivalents of all Alternative Currency Loans outstanding
on the date of such Alternative Currency Borrowing to exceed $75,000,000.
(e) Allocation. If offers are made by two or more Banks at the
same Alternative Currency Rates for a greater aggregate principal amount than
the amount in respect of which such offers are accepted for the related
Interest Period, the principal amount of Alternative Currency Loans in respect
of which such offers are accepted shall be allocated by the Borrower among such
Banks as nearly as possible in proportion to the principal amounts of such
offers. Determinations by the Borrower of the amounts of Alternative Currency
Loans shall be conclusive in the absence of manifest error.
29
<PAGE> 35
(f) Funding of Alternative Currency Loans. On the date of each
Alternative Currency Borrowing, the Alternative Currency Lending Office of each
Bank participating therein shall make available its share of such Borrowing, in
such funds and at such time as may then be customary for the settlement of
international transactions in such Alternative Currency, to the Borrower at such
Bank's Alternative Currency Lending Office.
(g) Reports. Immediately before (i) any Alternative Currency
Loan is made, (ii) any Dollar-Denominated Loan is made at a time when one or
more Alternative Currency Loans is outstanding, or (iii) the Commitments are
reduced pursuant to Section 2.11 at a time when one or more Alternative
Currency Loans is outstanding, the Borrower shall deliver to the Agent a report
(an "Alternative Currency Loan Report") listing each Alternative Currency Loan
then outstanding, the principal amount and Alternative Currency of each such
Loan and the Dollar Equivalent of each such Loan. Upon receipt of each such
Alternative Currency Loan Report, the Agent shall promptly notify each Bank of
the contents thereof.
SECTION 2.6. Notice to Banks; Funding of Loans. (a) Upon
receipt of a Notice of Committed Borrowing or Notice of Money Market Borrowing,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's share (if any) of such Borrowing and such Notice of Borrowing shall not
thereafter be revocable by the Borrower.
(b) Not later than 12:00 Noon (New York City time) on the date of
each Committed Borrowing or Money Market Borrowing, each Bank participating
therein shall make available its share of such Borrowing, in Federal or other
funds immediately available in New York City, to the Agent at its address
referred to in Section 9.1. Unless the Agent determines that any applicable
condition specified in Article 3 has not been satisfied, the Agent will make
the funds so received from the Banks available to the Borrower at the Agent's
aforesaid address.
(c) Unless the Agent shall have received notice from a Bank prior
to the date of any such Borrowing that such Bank will not make available to the
Agent such Bank's share of such Borrowing, the Agent may assume that such Bank
has made such share available to the Agent on the date of such Borrowing in
accordance with subsection (b) of this Section and the Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Agent, such Bank and the Borrower severally
agree to repay to the Agent forthwith on demand such corresponding amount
together with interest
30
<PAGE> 36
thereon, for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Agent, at (i) in the case
of the Borrower, a rate per annum equal to the higher of the Federal Funds Rate
and the interest rate applicable thereto pursuant to Section 2.9 and (ii) in the
case of such Bank, the Federal Funds Rate. If such Bank shall repay to the
Agent such corresponding amount, such amount so repaid shall constitute such
Bank's Loan included in such Borrowing for purposes of this Agreement.
SECTION 2.7. Notes. (a) The Loans of each Bank shall be
evidenced by a single Note payable to the order of such Bank for the account of
its Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the Agent,
request that its Loans of a particular type be evidenced by a separate Note in
an amount equal to the aggregate unpaid principal amount of such Loans. Each
such Note shall be in substantially the form of Exhibit A hereto with
appropriate modifications to reflect the fact that it evidences solely Loans of
the relevant type. Each reference in this Agreement to the "Note" of such Bank
shall be deemed to refer to and include any or all of such Notes, as the
context may require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.1(a),
the Agent shall forward such Note to such Bank. Each Bank shall record the
date, amount, type and currency of each Loan made by it and the date and amount
of each payment of principal made by the Borrower with respect thereto, and
may, if such Bank so elects in connection with any transfer or enforcement of
its Note, endorse on the schedule forming a part thereof appropriate notations
to evidence the foregoing information with respect to each such Loan then
outstanding; provided that neither the failure of any Bank to make any such
recordation or endorsement nor any error in any such endorsement shall affect
the obligations of the Borrower hereunder or under the Notes. Each Bank is
hereby irrevocably authorized by the Borrower so to endorse its Note and to
attach to and make a part of its Note a continuation of any such schedule as
and when required.
SECTION 2.8. Maturity of Loans. (a) Each Committed Loan held by
each Bank shall mature, and the principal amount thereof shall be due and
payable, on such Bank's Termination Date.
(b) Each Money Market Loan and Alternative Currency Loan shall
mature, and the principal amount thereof
31
<PAGE> 37
shall be due and payable, on the last day of the Interest Period applicable to
such Loan.
SECTION 2.9. Interest Rates. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per annum equal to the
Base Rate for such day. Such interest shall be payable quarterly in arrears on
each Quarterly Date and, with respect to the principal amount of any Base Rate
Loan converted to a CD Loan or a Euro-Dollar Loan, on the date such principal
amount is so converted. Any overdue principal of or interest on any Base Rate
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the sum of 2% plus the Base Rate for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each day during each Interest Period applicable thereto, at
a rate per annum equal to the sum of the CD Margin for such day plus the
Adjusted CD Rate applicable to such Interest Period; provided that if any CD
Loan or any portion thereof shall, as a result of clause (2)(b) of the
definition of Interest Period, have an Interest Period of less than 30 days,
such portion shall bear interest during such Interest Period at the Base Rate
during such period. Such interest shall be payable for each Interest Period on
the last day thereof and, if such Interest Period is longer than 90 days, 90
days after the first day thereof. Any overdue principal of or interest on any
CD Loan shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the sum of 2% plus the higher of (i) the sum of the CD
Margin plus the Adjusted CD Rate applicable to such Loan at the date such
payment was due and (ii) the Base Rate for such day.
The "Adjusted CD Rate" applicable to any Interest Period means a
rate per annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
__________
* The amount in brackets being rounded upward, if
necessary, to the next higher 1/100 of 1%
32
<PAGE> 38
The "CD Base Rate" applicable to any Interest Period is the rate
of interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum
bid at 10:00 A.M. (New York City time) (or as soon thereafter as practicable)
on the first day of such Interest Period by two or more New York certificate of
deposit dealers of recognized standing for the purchase at face value from each
CD Reference Bank of its certificates of deposit in an amount comparable to the
principal amount of the CD Loan of such CD Reference Bank to which such
Interest Period applies and having a maturity comparable to such Interest
Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of new non-personal time deposits in dollars in New York City having a
maturity comparable to the related Interest Period and in an amount of $100,000
or more. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate in
effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. Section 327.3(e) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or such
successor's) insuring time deposits at offices of such institution in the United
States. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during each Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for
such day plus the London Interbank Offered Rate applicable to such Interest
Period. Such interest shall be payable for each Interest Period on the last
day thereof and, if such Interest Period is longer than three months, three
months after the first day thereof.
The "London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if
33
<PAGE> 39
necessary, to the next higher 1/16 of 1%) of the respective rates per annum at
which deposits in dollars are offered to each of the Euro-Dollar Reference Banks
in the London interbank market at approximately 11:00 A.M. (London time) two
Euro-Dollar Business Days before the first day of such Interest Period in an
amount approximately equal to the principal amount of the Euro-Dollar Loan of
such Euro-Dollar Reference Bank to which such Interest Period is to apply and
for a period of time comparable to such Interest Period.
(d) Any overdue principal of or interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the higher of (i) the sum of 2% plus the Euro-Dollar Margin for
such day plus the average (rounded upward, if necessary, to the next higher
1/16 of 1%) of the respective rates per annum at which one day (or, if such
amount due remains unpaid more than three Euro-Dollar Business Days, then for
such other period of time not longer than three months as the Agent may select)
deposits in dollars in an amount approximately equal to such overdue payment
due to each of the Euro-Dollar Reference Banks are offered to such Euro-Dollar
Reference Bank in the London interbank market for the applicable period
determined as provided above (or, if the circumstances described in clause (a)
or (b) of Section 8.1 shall exist, at a rate per annum equal to the sum of 2%
plus the rate applicable to Base Rate Loans for such day) and (ii) the sum of
2% plus the Euro-Dollar Margin for such day plus the London Interbank Offered
Rate applicable to such Loan at the date such payment was due.
(e) Subject to Section 8.1, each Money Market LIBOR Loan shall
bear interest on the outstanding principal amount thereof, for the Interest
Period applicable thereto, at a rate per annum equal to the sum of the London
Interbank Offered Rate for such Interest Period (determined in accordance with
Section 2.9(c) as if the related Money Market LIBOR Borrowing were a Committed
Euro-Dollar Borrowing) plus (or minus) the Money Market Margin quoted by the
Bank making such Loan in accordance with Section 2.4. Each Money Market
Absolute Rate Loan shall bear interest on the outstanding principal amount
thereof, for the Interest Period applicable thereto, at a rate per annum equal
to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.4. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.
34
<PAGE> 40
(f) Each Alternative Currency Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the Alternative Currency Rate quoted by
the Bank making such Loan in accordance with Section 2.5. Such interest shall
be payable for each Interest Period on the last day thereof. Any overdue
principal of or interest on any Alternative Currency Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the sum
of 2% plus the Euro-Dollar Margin for such day plus the rate per annum at which
one day deposits in the relevant Alternative Currency in an amount
approximately equal to the principal amount of such Loan are offered to such
Bank in the London interbank market at approximately 11:00 A.M. (London time)
for such day.
(g) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Agent as contemplated by this Section. If any Reference Bank
does not furnish a timely quotation, the Agent shall determine the relevant
interest rate on the basis of the quotation or quotations furnished by the
remaining Reference Bank or Banks or, if none of such quotations is available
on a timely basis, the provisions of Section 8.1 shall apply.
SECTION 2.10. Facility Fees. (a) The Borrower shall pay to the
Agent for the account of each Bank a facility fee at the Facility Fee Rate. Such
facility fee shall accrue (i) for each day from and including the Effective Date
to but excluding the date of termination of such Bank's Commitment, on the
amount of its Commitment (whether used or unused) on such day and (ii) for each
day from and including such date of termination of such Bank's Commitment to but
excluding the date on which its Loans shall be repaid in their entirety, on the
outstanding principal amount of its Loans on such day.
(b) Such facility fees shall be payable for the account of each
Bank quarterly in arrears on each Quarterly Date and on the date on which its
Commitment terminates in its entirety (and, if later, the date on which its
Loans shall be repaid in their entirety).
SECTION 2.11. Optional Termination or Reduction of Commitments.
The Borrower may, upon at least three Domestic Business Days' notice to the
Agent, (i) terminate the Commitments at any time, if no Loans are outstanding
at such time, or (ii) ratably reduce from time to time, by an aggregate amount
of at least $10,000,000, the aggregate amount of the Commitments in excess of
the sum of (x) aggregate outstanding principal amount of the Dollar-Denominated
Loans and (y) the aggregate Dollar Equivalents of the outstanding Alternative
Currency Loans.
35
<PAGE> 41
SECTION 2.12. Method of Electing Interest Rates. (a) The Loans
included in each Committed Borrowing shall bear interest initially at the type
of rate specified by the Borrower in the applicable Notice of Committed
Borrowing. Thereafter, the Borrower may from time to time elect to change or
continue the type of interest rate borne by each Group of Loans (subject in
each case to the provisions of Article 8), as follows:
(i) if such Loans are Base Rate Loans, the Borrower may elect
to convert such Loans to CD Loans as of any Domestic Business Day or to
Euro-Dollar Loans as of any Euro-Dollar Business Day;
(ii) if such Loans are CD Loans, the Borrower may elect to (x)
convert such Loans to Base Rate Loans on any Domestic Business Day, (y)
convert such Loans to Euro-Dollar Loans on any Euro-Dollar Business Day or
(z) continue such Loans as CD Loans for an additional Interest Period,
subject to Section 2.16 in the case of any such conversion effective on any
day other than the last day of the then current Interest Period applicable
to such Loans; and
(iii) if such Loans are Euro-Dollar Loans, the Borrower may elect
to (x) convert such Loans to Base Rate Loans or CD Loans on any Euro-Dollar
Business Day or (y) continue such Loans as Euro-Dollar Loans for an
additional Interest Period, subject to Section 2.16 in the case of any such
conversion effective on any day other than the last day of the then current
Interest Period applicable to such Loans.
Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Agent not later than 10:30 A.M. (New York City time) on
the third Euro-Dollar Business Day before the conversion or continuation
selected in such notice is to be effective (unless the relevant Loans are to be
converted from Domestic Loans of one type to Domestic Loans of the other type
or are CD Rate Loans to be continued as CD Rate Loans for an additional
Interest Period, in which case such notice shall be delivered to the Agent not
later than 10:30 A.M. (New York City time) on the second Domestic Business Day
before such conversion or continuation is to be effective). A Notice of
Interest Rate Election may, if it so specifies, apply to only a portion of the
aggregate principal amount of the relevant Group of Loans; provided that (i)
such portion is allocated ratably among the Loans comprising such Group and
(ii) the portion to which such Notice applies, and the remaining portion to
which it does not apply, are each at least $10,000,000. If such notice is not
timely received with respect to any Group of Euro-Dollar Loans or CD Loans,
37
<PAGE> 42
the Borrower shall be deemed to have elected that such Group of Loans be
converted to Base Rate Loans.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which such
notice applies;
(ii) the date on which the conversion or continuation selected
in such notice is to be effective, which shall comply with the applicable
clause of subsection (a) above;
(iii) if the Loans comprising such Group are to be converted, the
new type of Loans and, if such Loans are to be Fixed Rate Loans, the
duration of the next succeeding Interest Period applicable thereto; and
(iv) if such Loans are to be continued as CD Loans or
Euro-Dollar Loans for an additional Interest Period, the duration of such
additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from
the Borrower pursuant to subsection (a) above, the Agent shall promptly notify
each Bank of the contents thereof and such notice shall not thereafter be
revocable by the Borrower.
SECTION 2.13. Mandatory Termination of Commitments. The
Commitment of each Bank shall terminate on its Termination Date and all its
Loans then outstanding (together with accrued interest thereon) shall be due
and payable on such date.
SECTION 2.14. Optional Prepayments. (a) Subject in the case of
any Fixed Rate Loans to Section 2.16, the Borrower may (i) upon notice to the
Agent not later than 11:00 A.M. (New York City time) on the date of prepayment,
prepay the Group of Base Rate Loans, (ii) upon at least three Euro-Dollar
Business Days' notice to the Agent, prepay any Group of Euro-Dollar Loans or
(iii) upon at least two Domestic Business Days' notice to the Agent, prepay any
Group of CD Loans, in each case in whole at any time, or from time to time in
part in amounts aggregating at least $10,000,000, by paying the principal
amount to be prepaid together with accrued interest thereon to the date of
prepayment. Each such optional prepayment shall be applied
37
<PAGE> 43
to prepay ratably the Loans of the several Banks included in such Group.
(b) The Borrower may not prepay all or any portion of the
principal amount of any Money Market Loan (except a Money Market LIBOR Loan
bearing interest at the Base Rate pursuant to Section 8.1) or Alternative
Currency Loan prior to the end of the Interest Period applicable thereto.
(c) Upon receipt of a notice of prepayment pursuant to this
Section, the Agent shall promptly notify each Bank of the contents thereof and
of such Bank's ratable share (if any) of such prepayment and such notice shall
not thereafter be revocable by the Borrower.
SECTION 2.15. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the
Dollar-Denominated Loans and of fees hereunder, not later than 12:00 Noon (New
York City time) on the date when due, in Federal or other funds immediately
available in New York City, to the Agent at its address referred to in Section
9.1. The Agent will promptly distribute to each Bank its ratable share of each
such payment received by the Agent for the account of the Banks. Whenever any
payment of principal of, or interest on, the Domestic Loans or of fees shall be
due on a day which is not a Domestic Business Day, the date for payment thereof
shall be extended to the next succeeding Domestic Business Day. Whenever any
payment of principal of, or interest on, the Euro-Dollar Loans shall be due on a
day which is not a Euro-Dollar Business Day, the date for payment thereof shall
be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the date
for payment thereof shall be the next preceding Euro-Dollar Business Day.
Whenever any payment of principal of, or interest on, the Money Market Loans
shall be due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar Business
Day. If the date for any payment of principal is extended by operation of law
or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Banks hereunder that the
Borrower will not make such payment in full, the Agent may assume that the
Borrower has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each Bank on
such due date an amount equal to the amount then due such Bank. If and to the
extent that the Borrower shall not have so made such payment, each Bank
38
<PAGE> 44
shall repay to the Agent forthwith on demand such amount distributed to such
Bank together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Agent, at the Federal Funds Rate.
(c) Each payment to be made by the Borrower hereunder or under
the Notes in an Alternative Currency shall be made to the relevant Bank in
such funds as may then be customary for the settlement of international
transactions in such Alternative Currency, at such time and at such place as
shall have been notified by such Bank to the Borrower not less than two
Euro-Dollar Business Days before the day on which such payment is due.
SECTION 2.16. Funding Losses. If the Borrower makes any payment
of principal with respect to any Fixed Rate Loan or any Fixed Rate Loan is
converted (pursuant to Article 2, 6 or 8 or otherwise) on any day other than the
last day of an Interest Period applicable thereto, or the last day of an
applicable period fixed pursuant to Section 2.9(d), or if the Borrower fails to
borrow or prepay any Fixed Rate Loans after notice has been given to any Bank in
accordance with Section 2.5(d), 2.6(a) or 2.14(c), the Borrower shall reimburse
each Bank within 15 days after demand for any resulting loss or expense incurred
by it (or by an existing or prospective Participant in the related Loan),
including (without limitation) any loss incurred in obtaining, liquidating or
employing deposits from third parties, but excluding loss of margin for the
period after any such payment or conversion or failure to borrow or prepay,
provided that such Bank shall have delivered to the Borrower a certificate as to
the amount of such loss or expense, which certificate shall be conclusive in the
absence of manifest error.
SECTION 2.17. Computation of Interest and Fees. (a) Interest
based on the Prime Rate hereunder shall be computed on the basis of a year of
365 days (or 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other
interest and fees shall be computed on the basis of a year of 360 days and paid
for the actual number of days elapsed (including the first day but excluding
the last day).
(b) The Agent shall determine each interest rate applicable to
the Committed Loans and Money Market Loans hereunder and the Facility Fee Rate
in effect from time to time. The Agent shall give prompt notice to the
Borrower and the participating Banks of each such rate of interest and Facility
Fee Rate so determined, and its determination thereof shall be conclusive in
the absence of manifest
39
<PAGE> 45
error; provided that, if the Agent makes such determinations for any Rate Period
on the basis of an estimated Pricing Level and/or estimated Interest Coverage
Ratio set forth in a certificate delivered by the Borrower pursuant to Section
5.1(e) and subsequently determines (or receives a certificate pursuant to
Section 5.1(e) establishing) that higher rates apply during such Rate Period,
the Agent shall promptly notify the Borrower and the participating Banks of such
higher rates and, within two Domestic Business Days after receiving such notice,
the Borrower shall pay to the Agent, for the accounts of the relevant
participating Banks, the additional interest and additional facility fees that
should have been paid prior to such time by reason of the applicability of such
higher rates. If the Agent makes such determinations on the basis of a Pricing
Level and/or Interest Coverage Ratio estimated by the Borrower and subsequently
determines (or receives a certificate pursuant to Section 5.1(e) establishing)
that lower rates apply during the relevant Rate Period, no adjustment shall be
made for any resulting overpayments of interest or facility fees theretofore
made by the Borrower on the basis of the Pricing Level and/or Interest Coverage
Ratio estimated by it.
SECTION 2.18. Regulation D Compensation. Each Bank may require
the Borrower to pay, contemporaneously with each payment of interest on the
Euro-Dollar Loans, additional interest on the related Euro-Dollar Loan of such
Bank at a rate per annum determined by such Bank up to but not exceeding the
excess of (i) (A) the applicable London Interbank Offered Rate divided by (B)
one minus the Euro-Dollar Reserve Percentage over (ii) the applicable London
Interbank Offered Rate. Any Bank wishing to require payment of such additional
interest (x) shall so notify the Borrower and the Agent, in which case such
additional interest on the Euro-Dollar Loans of such Bank shall be payable to
such Bank at the place indicated in such notice with respect to each Interest
Period commencing at least three Euro-Dollar Business Days after the giving of
such notice, and (y) shall notify the Borrower at least five Euro-Dollar
Business Days prior to each date on which interest is payable on the
Euro-Dollar Loans of the amount then due it under this Section.
SECTION 2.19. Judgment Currency. If for the purposes of
obtaining judgment in any court it is necessary to convert a sum due from the
Borrower hereunder or under any of the Notes in the currency expressed to be
payable herein or under the Notes (the "Specified Currency") into another
currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Agent could purchase the
Specified Currency with such other currency at the Agent's
40
<PAGE> 46
New York office on the Euro-Dollar Business Day preceding that on which final
judgment is given. The obligations of the Borrower in respect of any sum due to
any Bank or the Agent hereunder or under any Note shall, notwithstanding any
judgment in a currency other than the Specified Currency, be discharged only to
the extent that, on the Euro-Dollar Business Day following receipt by such Bank
or the Agent (as the case may be) of any sum adjudged to be so due in such other
currency, such Bank or the Agent (as the case may be) may in accordance with
normal banking procedures purchase the Specified Currency with such other
currency. If the amount of the Specified Currency so purchased is less than
the sum originally due to such Bank or the Agent, as the case may be, in the
Specified Currency, the Borrower agrees, to the fullest extent that it may
effectively do so, as a separate obligation and notwithstanding any such
judgment, to indemnify such Bank or the Agent, as the case may be, against such
loss, and if the amount of the Specified Currency so purchased exceeds (a) the
sum originally due to such Bank or the Agent, as the case may be, in the
Specified Currency and (b) any amounts shared with other Banks as a result of
allocations of such excess as a disproportionate payment to such Bank under
Section 9.4, such Bank or the Agent, as the case may be, agrees to remit such
excess to the Borrower.
ARTICLE 3
CONDITIONS
SECTION 3.1. Closing. The closing hereunder shall occur when the
Agent has received all of the following:
(a) a duly executed Note for the account of each Bank dated on or
before the Closing Date and complying with the provisions of Section 2.7;
(b) an opinion of Jones, Day, Reavis & Pogue, special counsel for
the Borrower, substantially in the form of Exhibit G hereto and covering
such additional matters relating to the transactions contemplated hereby as
the Required Banks may reasonably request;
(c) an opinion of Bergen I. Bull, Esq. General Counsel for the
Borrower, substantially in the form of Exhibit H hereto and covering such
additional matters relating to the transactions contemplated hereby as the
Required Banks may reasonably request;
41
<PAGE> 47
(d) an opinion of Davis Polk & Wardwell, special counsel for the
Agent, substantially in the form of Exhibit I hereto and covering such
additional matters relating to the transactions contemplated hereby as the
Required Banks may reasonably request;
(e) evidence satisfactory to the Agent that (i) the commitments
of the banks under the Existing Credit Agreement have been terminated, (ii)
all letters of credit issued thereunder have been canceled and (iii) all
loans and reimbursement obligations outstanding thereunder and all interest
and fees accrued thereunder have been paid in full or the Borrower has made
arrangements satisfactory to the Agent to pay such amounts in full on the
Closing Date;
(f) evidence satisfactory to the Agent that (i) all security
interests created by the Existing Security Agreements have been released,
(ii) termination statements have been filed or delivered for filing
under the Uniform Commercial Code as required to evidence the termination
of such security interests and (iii) all stock certificates and other
instruments pledged under the Existing Security Agreements have been
returned to the Borrower or Holdings, as the case may be;
(g) evidence satisfactory to the Agent that the Borrower has paid
in full the participation fees payable for the accounts of the Banks as
described in the term sheet dated January 11, 1995 relating to this credit
facility or has made arrangements satisfactory to the Agent to pay such
fees in full on the Closing Date; and
(h) all documents that the Agent may reasonably request relating
to the existence of the Borrower, the corporate authority for and the
validity of this Agreement and the Notes, and any other matters relevant
hereto, all in form and substance satisfactory to the Agent.
Promptly after the closing hereunder occurs, the Agent shall notify the
Borrower and the Banks of the Closing Date, and such notice shall be
conclusive and binding on all parties hereto.
SECTION 3.2. Borrowings. The obligation of any Bank to make a
Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) the fact that the Closing Date shall have occurred on or
prior to March __, 1995;
42
<PAGE> 48
(b) receipt by the Agent of a Notice of Borrowing as required by
Section 2.3 or 2.4, or receipt by the relevant Banks of a Notice of
Alternative Currency Borrowing as required by Section 2.5, as the case may
be;
(c) the fact that, immediately after such Borrowing, the sum of
(i) the aggregate outstanding principal amount of all Dollar-Denominated
Loans and (ii) the aggregate Dollar Equivalents of all outstanding
Alternative Currency Loans will not exceed the aggregate amount of the
Commitments;
(d) the fact that, immediately before and after such Borrowing,
no Default shall have occurred and be continuing; and
(e) the fact that the representations and warranties of the
Borrower contained in this Agreement shall be true on and as of the date of
such Borrowing.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the facts specified in clauses
(c), (d) and (e) of this Section.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.1. Corporate Existence and Power. The Borrower is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.2. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of this
Agreement and the Notes are within the corporate powers of the Borrower, have
been duly authorized by all necessary corporate action, require no action by or
in respect of, or filing with, any governmental body, agency or official and do
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-laws of the Borrower
or of any agreement (after giving effect to Section 9.8 hereof), judgment,
injunction, order,
43
<PAGE> 49
decree or other instrument binding upon the Borrower or any Subsidiary or result
in the creation or imposition of any Lien on any asset of the Borrower or any
Subsidiary.
SECTION 4.3. Binding Effect. This Agreement constitutes a valid
and binding agreement of the Borrower and each Note, when executed and
delivered in accordance with this Agreement, will constitute a valid and
binding obligation of the Borrower, in each case enforceable in accordance with
its terms.
SECTION 4.4. Financial Information. (a) The consolidated
balance sheet of Holdings and its Subsidiaries as of December 31, 1993 and the
related consolidated statements of income, cash flows and stockholders' equity
for the Fiscal Year then ended, reported on by Arthur Andersen & Co. and set
forth in the Holdings' 1993 Form 10-K, a copy of which has been delivered to
each of the Banks, fairly present, in conformity with GAAP, the consolidated
financial position of Holdings and its Subsidiaries as of such date and their
consolidated results of operations and cash flows for such Fiscal Year.
(b) The unaudited consolidated balance sheet of Holdings and its
Subsidiaries as of September 30, 1994 and the related unaudited consolidated
statements of income, cash flows and stockholders' equity for the nine months
then ended, set forth in Holdings' Latest Form 10-Q, a copy of which has been
delivered to each of the Banks, fairly present, on a basis consistent with the
financial statements referred to in subsection (a) of this Section, the
consolidated financial position of Holdings and its Subsidiaries as of such
date and their consolidated results of operations and cash flows for such
nine-month period (subject to normal year-end adjustments).
(c) At December 31, 1993 and September 30, 1994 Holdings had, and
on the Closing Date Holdings will have:
(i) no material assets other than (w) the common stock of the
Borrower, (x) rights under the Tax Sharing Agreement, (y) rights under
Interest Rate Contracts entered into as required by the Existing Credit
Agreement, and (z) tangible property having an aggregate book value not
exceeding $500,000; and
(ii) no material liabilities other than (v) the Subordinated
Debentures, (w) the Existing Term Loans, (x) liabilities under the Tax
Sharing Agreement, (y) guarantees of obligations of the Borrower and (z)
liabilities under Interest Rate Contracts entered into as required by the
Existing Credit Agreement.
44
<PAGE> 50
Accordingly, if adjusted to eliminate the Subordinated Debentures and Existing
Term Loans and related interest expense, the financial statements referred to
in subsections (a) and (b) of this Section would fairly present in all material
respects the consolidated financial position of the Borrower and its
Subsidiaries at December 31, 1993 and September 30, 1994, respectively, and
their consolidated results of operations and cash flows for the Fiscal Year
ended December 31, 1993 and (subject to normal year-end adjustments) the
nine-month period ended September 30, 1994, respectively.
(d) Since September 30, 1994 there has been no material adverse
change in the business, financial position or results of operations of Holdings
and its Subsidiaries, considered as a whole. If the representation and
warranty set forth in this subsection (d) is made (or deemed made) pursuant to
Section 3.2 as of any date after the Holdings Merger is consummated, it shall
be deemed to refer to the Borrower and its Subsidiaries and neither the
repayment of the Existing Term Loans on the Closing Date nor the Borrower's
provision of funds to Holdings for such repayment shall be deemed to constitute
a material adverse change. If such representation and warranty is made (or
deemed made) pursuant to Section 3.2 as of any date after the Subordinated
Debentures are redeemed as contemplated by Section 5.8(c), neither the
redemption thereof nor the Borrower's provision of funds to Holdings for such
redemption shall be deemed to constitute a material adverse change.
SECTION 4.5. Litigation. There is no action, suit or proceeding
pending against, or to the knowledge of the Borrower threatened against or
affecting, the Borrower or any Subsidiary before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable
possibility of an adverse decision which could materially adversely affect the
business, consolidated financial position or consolidated results of operations
of the Borrower and its Subsidiaries, considered as a whole, or which in any
manner draws into question the validity of this Agreement or the Notes.
SECTION 4.6. Compliance with Laws. The Borrower and its
Subsidiaries are in compliance in all material respects with all applicable
laws, rules, regulations and requirements of governmental authorities
(including, without limitation, Environmental Laws, rules or regulations),
except where the necessity of compliance therewith is being contested in good
faith by appropriate proceedings.
SECTION 4.7. Compliance with ERISA. Each member of the ERISA
Group has fulfilled its obligations under the
45
<PAGE> 51
minimum funding standards of ERISA and the Internal Revenue Code with respect to
each Plan and is in compliance in all material respects with the presently
applicable provisions of ERISA and the Internal Revenue Code with respect to
each Plan. No member of the ERISA Group has (i) sought a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code in respect of
any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security under
ERISA or the Internal Revenue Code or (iii) incurred any liability under Title
IV of ERISA other than a liability to the PBGC for premiums under Section 4007
of ERISA.
SECTION 4.8. Environmental Matters. In the ordinary course of
its business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital or
operating expenditures required for clean-up or closure of properties presently
or previously owned, any capital or operating expenditures required to achieve
or maintain compliance with environmental protection standards imposed by law
or as a condition of any license, permit or contract, any related constraints
on operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted thereat, any costs or liabilities in connection with off-site
disposal of wastes or Hazardous Substances, and any actual or potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, the Borrower has reasonably concluded
that such associated liabilities and costs, including the costs of compliance
with Environmental Laws, are unlikely to have a material adverse effect on the
business, financial condition or results of operations of the Borrower and its
Subsidiaries, considered as a whole.
SECTION 4.9. Taxes. All United States Federal income tax returns
and all other material tax returns which are required to be filed by or on
behalf of the Borrower and its Affiliates have been filed and all taxes shown
as due on such returns or pursuant to any assessment in respect of taxes
received by them have been paid. The charges, accruals and reserves on the
books of the Borrower and its Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of the Borrower, adequate.
46
<PAGE> 52
SECTION 4.10. Subsidiaries. Each of the Borrower's corporate
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.
SECTION 4.11. No Regulatory Restrictions on Borrowing. The
Borrower is not an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or otherwise subject to
any regulatory scheme which restricts its ability to incur debt.
SECTION 4.12. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to the Agent or any
Bank will be, true and accurate in all material respects on the date as of
which such information is stated or certified. The Borrower has disclosed to
the Banks in writing any and all facts which materially and adversely affect,
or may affect (to the extent the Borrower can now reasonably foresee), the
business, operations or financial position of the Borrower and its
Subsidiaries, taken as a whole, or the ability of the Borrower to perform its
obligations under this Agreement.
SECTION 4.13. Solvency. On each date that the Borrower provides
funds to Holdings for the repayment of the Existing Term Loans or the
redemption of the Subordinated Debentures, and after giving effect thereto, (i)
the aggregate fair market value of the assets of the Borrower will exceed its
liabilities (including contingent, subordinated, unmatured and unliquidated
liabilities), (ii) the Borrower will have sufficient cash flow to enable it to
pay its debts as they mature and (iii) the Borrower will not have unreasonably
small capital for the business in which it is engaged.
ARTICLE 5
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment
hereunder or any Loan is outstanding hereunder or any interest or facility fees
accrued hereunder remain unpaid:
47
<PAGE> 53
SECTION 5.1. Information. The Borrower will deliver to each of
the Banks:
(a) as soon as available and in any event within 90 days after
the end of each Fiscal Year, a consolidated balance sheet of the Borrower
and its Subsidiaries as of the end of such Fiscal Year and the related
consolidated statements of income, cash flows and stockholders' equity for
such Fiscal Year, setting forth in each case in comparative form the
corresponding figures for the previous Fiscal Year, all reported on in a
manner acceptable to the SEC by Arthur Andersen & Co. or other independent
public accountants of nationally recognized standing; provided that the
foregoing requirement may be satisfied, as of any date prior to the Holdings
Merger, by delivering such consolidated financial statements of Holdings and
its Subsidiaries;
(b) as soon as available and in any event within 45 days after
the end of each of the first three Fiscal Quarters of each Fiscal Year, a
consolidated balance sheet of the Borrower and its Subsidiaries as of the
end of such Fiscal Quarter, the related consolidated statements of income
for such Fiscal Quarter and for the portion of the Fiscal Year ended at the
end of such Fiscal Quarter and the related consolidated statement of cash
flows for the portion of the Fiscal Year then ended, setting forth in the
case of such consolidated statements of income and cash flows in
comparative form the figures for the corresponding Fiscal Quarter and the
corresponding portion of the Borrower's previous Fiscal Year, all certified
(subject to normal year-end adjustments) as to fairness of presentation and
consistency with GAAP by the chief financial officer, the chief accounting
officer or the treasurer of the Borrower; provided that the foregoing
requirement may be satisfied, as of any date prior to the Holdings Merger,
by delivering such consolidated financial statements of Holdings and its
Subsidiaries;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate signed
by the chief financial officer, the chief accounting officer or the
treasurer of the Borrower (i) setting forth in reasonable detail the
calculations required to establish whether the Borrower was in compliance
with the requirements of Sections 5.9(h), 5.10, 5.11, 5.12, 5.13, 5.14(c),
5.15(e), 5.15(g), 5.16 and 5.17(g) on the date of such financial statements
and (ii) stating whether any Default exists on the date of such certificate
and, if any Default then exists, setting forth the details
48
<PAGE> 54
thereof and the action which the Borrower is taking or proposes to take with
respect thereto;
(d) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements (i)
whether anything has come to their attention to cause them to believe that
any Default existed on the date of such statements and (ii) confirming the
calculations set forth in the officer's certificate delivered
simultaneously therewith pursuant to clause (c) above;
(e) within 45 days after the end of each Fiscal Quarter, a
certificate signed by the chief financial officer, the chief accounting
officer or the treasurer of the Borrower setting forth the Interest
Coverage Ratio at the end of such Fiscal Quarter and the Pricing Level
applicable during the Rate Period that begins 46 days after the end of such
Fiscal Quarter and in reasonable detail the calculations required to
determine such Interest Coverage Ratio and Pricing Level; provided that (x)
in the case of the last Fiscal Quarter of any Fiscal Year, such certificate
may set forth only the Borrower's estimates as to whether such Interest
Coverage Ratio exceeds 3.25 to 1 and what Pricing Level applies (it being
understood that, if the Borrower in good faith cannot determine with
reasonable certainty whether such Interest Coverage Ratio exceeds 3.25 to 1
and/or which of two Pricing Levels applies, the Borrower may, in view of
the provisions of Section 2.17(b), appropriately estimate that such
Interest Coverage Ratio does exceed 3.25 to 1 and/or that the lower of such
Pricing Levels applies. If such certificate sets forth only such
estimates, the Borrower shall, within 90 days after the end of such Fiscal
Year, deliver a further certificate signed by the chief financial officer,
the chief accounting officer or the treasurer of the Borrower setting forth
the calculations contemplated by this clause (e) and either confirming that
such Interest Coverage Ratio exceeds 3.25 to 1 and the estimated Pricing
Level applies or, if not, setting forth the Interest Coverage Ratio and/or
Pricing Level that do apply for purposes of the relevant Rate Period and
requesting the Agent to determine the amounts of any additional interest
and/or additional fees payable by the Borrower pursuant to Section 2.17(b);
(f) within five Domestic Business Days after any Responsible
Officer of the Borrower obtains knowledge of any Default, if such Default
is then continuing, a certificate of the chief financial officer, the chief
49
<PAGE> 55
accounting officer or the treasurer of the Borrower setting forth the
details thereof and the action which the Borrower is taking or proposes to
take with respect thereto;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements
on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or
their equivalents) which the Borrower or Holdings shall have filed with the
SEC;
(h) if and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as defined
in Section 4043 of ERISA) with respect to any Plan which might constitute
grounds for a termination of such Plan under Title IV of ERISA, or knows
that the plan administrator of any Plan has given or is required to give
notice of any such reportable event, a copy of the notice of such
reportable event given or required to be given to the PBGC; (ii) receives
notice of complete or partial withdrawal liability under Title IV of ERISA
or notice that any Multiemployer Plan is in reorganization, is insolvent or
has been terminated, a copy of such notice; (iii) receives notice from the
PBGC under Title IV of ERISA of an intent to terminate, impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or
appoint a trustee to administer any Plan, a copy of such notice; (iv)
applies for a waiver of the minimum funding standard under Section 412 of
the Internal Revenue Code, a copy of such application; (v) gives notice of
intent to terminate any Plan under Section 4041(c) of ERISA, a copy of such
notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could
result in the imposition of a Lien or the posting of a bond or other
security, a certificate of the chief financial officer, the chief
accounting officer or the treasurer of the Borrower setting forth details
as to such occurrence and action, if any, which the Borrower or applicable
member of the ERISA Group is required or proposes to take; and
(i) from time to time such additional information regarding the
financial position or business of the Borrower and its Subsidiaries as the
Agent, at the request of any Bank, may reasonably request.
50
<PAGE> 56
SECTION 5.2. Payment of Obligations. The Borrower will pay and
discharge, and cause each Subsidiary to pay and discharge, at or before
maturity, all their respective material obligations and liabilities (including,
without limitation, tax liabilities and claims of materialmen, warehousemen and
the like which if unpaid might by law give rise to a Lien), except where the
same may be contested in good faith by appropriate proceedings, and will
maintain, and will cause each Subsidiary to maintain, in accordance with GAAP,
appropriate reserves for the accrual of the same.
SECTION 5.3. Maintenance of Property; Insurance. (a) The
Borrower will keep, and cause each Subsidiary to keep, all property useful and
necessary in its business in good working order and condition, ordinary wear
and tear excepted.
(b) The Borrower will, and will cause each of its Subsidiaries
to, maintain (either in the name of the Borrower or in such Subsidiary's own
name) with financially sound and responsible insurance companies, insurance on
all their respective properties in at least such amounts, against at least such
risks and with such risk retention as are usually maintained, insured against
or retained, as the case may be, in the same general area by companies of
established repute engaged in the same or a similar business; and will furnish
to the Banks, upon request from the Agent, information in reasonable detail as
to the insurance so carried.
SECTION 5.4. Conduct of Business and Maintenance of Existence.
The Borrower will continue, and cause each Subsidiary to continue, to engage in
business of the same general type as now conducted by the Borrower and its
Subsidiaries, and will preserve, renew and keep in full force and effect, and
will cause each Subsidiary to preserve, renew and keep in full force and
effect, its corporate existence and its rights, privileges and franchises
necessary or desirable in the normal conduct of business; provided that nothing
in this Section shall prohibit (i) any merger or consolidation permitted by
Section 5.7 or (ii) the termination of the corporate existence of any
Subsidiary if the Borrower in good faith determines that such termination is in
the best interest of the Borrower and is not materially disadvantageous to the
Banks.
SECTION 5.5. Compliance with Laws. The Borrower will comply, and
cause each Subsidiary to comply, in all material respects with all applicable
laws, ordinances, rules, regulations, and requirements of governmental
authorities (including, without limitation, applicable
51
<PAGE> 57
Environmental Laws and ERISA and the rules and regulations thereunder), except
where the necessity of compliance therewith is contested in good faith by
appropriate proceedings.
SECTION 5.6. Inspection of Property, Books and Records. The
Borrower will keep, and cause each Subsidiary to keep, proper books of record
and account in which full, true and correct entries shall be made of all
dealings and transactions in relation to its business and activities; and will
permit, and cause each Subsidiary to permit, representatives of any Bank at
such Bank's expense to visit and inspect any of their respective properties, to
examine and make abstracts from any of their respective books and records and
to discuss their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants, all at such
reasonable times and as often as may reasonably be desired.
SECTION 5.7. Mergers and Sales of Assets. The Borrower will not,
and will not permit any Subsidiary to, (x) consolidate or merge with any other
Person or (y) sell, lease or otherwise transfer, directly or indirectly, all or
any substantial part of the assets of the Borrower and its Subsidiaries, taken
as a whole, to any other Person; provided that:
(i) the Borrower may merge with Holdings if (A) the Borrower is
the corporation surviving such merger, (B) no Subordinated Debentures are
outstanding and (C) after giving effect to such merger, no Default shall
have occurred and be continuing;
(ii) the Borrower may merge with any Person other than Holdings if
(A) the Borrower is the corporation surviving such merger and (B) after
giving effect to such merger, no Default shall have occurred and be
continuing;
(iii) any Subsidiary may merge or consolidate with another Person
if the corporation surviving such merger or consolidation is the Borrower
or a Subsidiary and, after giving effect to such merger or consolidation,
no Default shall have occurred and be continuing; and
(iv) the Borrower may sell stock in any Subsidiary to another
Subsidiary; and
(v) any Subsidiary may sell, lease or otherwise transfer any or
all of its assets to the Borrower or another Subsidiary.
52
<PAGE> 58
SECTION 5.8. Use of Proceeds. The proceeds of the Loans made
under this Agreement will be used by the Borrower as follows:
(a) on the Closing Date to pay in full the principal of all
loans and reimbursement obligations of the Borrower then outstanding under
the Existing Credit Agreement and all interest and fees accrued thereunder;
(b) on the Closing Date to provide funds to Holdings to enable
Holdings to pay in full the principal of the Existing Term Loans and
interest accrued thereon;
(c) from time to time after the Closing Date to provide funds
to Holdings to enable Holdings to redeem the Subordinated Debentures; and
(d) for working capital and other general corporate purposes.
None of such proceeds will be used, directly or indirectly, for the purpose,
whether immediate, incidental or ultimate, of purchasing or carrying any
"margin stock" within the meaning of Regulation U.
SECTION 5.9. Negative Pledge. After the Closing Date, neither
the Borrower nor any Subsidiary will create, assume or suffer to exist any Lien
on any asset now owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt
and Accommodation Obligations outstanding on the date of this Agreement and
described in Exhibit L in an aggregate principal or face amount not
exceeding $25,000,000;
(b) any Lien existing on any asset of any corporation at the time
such corporation becomes a Subsidiary; provided that such Lien was not
created in contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed for
the purpose of financing all or any part of the cost of acquiring such
asset, provided that such Lien attaches to such asset concurrently with or
within 90 days after the acquisition of such event;
(d) any Lien on any asset of any corporation existing at the time
such corporation is merged or consolidated with or into the Borrower or a
Subsidiary; provided that such Lien was not created in contemplation of
such event;
53
<PAGE> 59
(e) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Subsidiary; provided that such Lien was not
created in contemplation of such acquisition;
(f) any Lien arising out of the refinancing, extension, renewal
or refunding of any Debt or Accommodation Obligation secured by any Lien
permitted by any of the foregoing clauses of this Section, provided that
the principal amount so secured is not increased and such Lien does not
apply to any additional assets;
(g) any Lien arising in the ordinary course of business which (i)
does not secure any Debt or Accommodation Obligation and (ii) does not
secure any single obligation or series of related obligations in an amount
exceeding $25,000,000; and
(h) Liens not otherwise permitted by the foregoing clauses of
this Section securing Debt or Accommodation Obligations in an aggregate
outstanding principal or face amount not at any time exceeding 10% of
Consolidated Net Worth;
provided that no such permitted Lien shall apply to the capital stock of any
Subsidiary or the Borrower's equity interest in Sumitomo-Yale.
SECTION 5.10. Debt Ratio. The ratio of Total Debt to Total
Capital shall not exceed 0.55 to 1 at any time prior to January 1, 1997 or 0.50
to 1 at any time thereafter.
SECTION 5.11. Debt of Subsidiaries. The aggregate principal
amount of all Debt and Accommodation Obligations of all Subsidiaries (excluding
(i) Debt and Accommodation Obligations owed to the Borrower or to a
wholly-owned Subsidiary, (ii) other Accommodation Obligations to the extent
that they directly or indirectly guarantee Debt of wholly-owned Subsidiaries
and (iii) Accommodation Obligations permitted by subsections (a) and (d) of
Section 5.17) will at no time exceed $55,000,000. For purposes of this Section
5.11, Hyster Brasil Ltda. shall be deemed not to be a Subsidiary.
SECTION 5.12. Interest Coverage Ratio. At the end of each Fiscal
Quarter ending during each calendar year set forth below, the Interest Coverage
Ratio will not be less than the ratio set forth below opposite such year:
54
<PAGE> 60
<TABLE>
<CAPTION>
Year Ratio
---- -----
<S> <C>
1995 2.20 to 1
1996 2.25 to 1
1997 2.30 to 1
1998 2.35 to 1
1999 and thereafter 2.40 to 1
</TABLE>
SECTION 5.13. Minimum Consolidated Net Worth. Consolidated Net
Worth will not at any time be less than the sum of (i) $237,500,000 and (ii)
the amount equal to 50% of Consolidated Net Income for each Fiscal Quarter
beginning after September 30, 1994 and ending at or prior to such time for
which Consolidated Net Income is positive; provided that the level of
Consolidated Net Worth required to be maintained by this Section shall not at
any time exceed the lesser of (i) $400,000,000 or (ii) 63% of Total Capital at
the end of the then most recent Fiscal Quarter for which financial statements
have been delivered to the Banks pursuant to subsection (a) or (b) of Section
5.1.
SECTION 5.14. Restricted Payments. Unless the Specified Covenant
Release Date shall have occurred, no Restricted Payment will be declared or
made by Holdings, the Borrower or any Subsidiary, except:
(a) dividends paid by the Borrower to Holdings to enable
Holdings to repay its Existing Term Loans, redeem its Subordinated
Debentures and/or pay its other obligations as they become due;
(b) payments for the purpose of purchasing up to 3% of the
outstanding common stock of Holdings (prior to the Holdings Merger) or of
the Borrower (after the Holdings Merger) held by Persons other than NACCO
Industries; and
(c) Restricted Payments not otherwise permitted pursuant to the
preceding clauses (a) and (b); provided that the aggregate amount of all
such Restricted Payments declared or made after September 30, 1994 will not
exceed $25,000,000.
SECTION 5.15. Investments. Unless the Specified Covenant Release
Date shall have occurred, neither the Borrower nor any Subsidiary will hold,
make or acquire any Investment, except:
(a) Investments existing on the date of this Agreement and
described in Exhibit M in an aggregate amount not exceeding $12,000,000;
55
<PAGE> 61
(b) Investments in the Borrower or any wholly-owned Subsidiary
(other than Hyster Brasil Ltda.);
(c) equity Investments by the Borrower in Yale Financial
Services, Inc., so long as it offers wholesale and retail financing and
leasing to the Borrower's U.S. Yale dealers and national accounts; provided
that such equity Investments shall not at any time comprise more than 20%
of the stockholders' equity of Yale Financial Services, Inc.;
(d) Investments by the Borrower in Sumitomo-Yale; provided that
the sum of Consolidated Capital Expenditures and Sumitomo-Yale Investments
for such Fiscal Year shall not exceed the amount permitted by Section 5.16;
(e) Investments in securities of a Person (other than an
Affiliate of the Borrower) received as all or part of the consideration for
any asset sold by the Borrower or a Subsidiary to such Person as permitted
by Section 5.7; provided that, with respect to each such sale of assets for
consideration consisting in whole or in part of such securities, either:
(i) the cash portion of such consideration is at least
equal to the lesser of (x) the book value of the asset sold or (y)
80% of the total consideration received for such asset, or
(ii) if the cash received for such asset is less than the
amount required to comply with clause (i), the amount of the
deficiency (a "Cash Shortfall") plus the aggregate amount of all
other Cash Shortfalls in connection with such sales of assets by
Holdings, the Borrower and the Borrower's Subsidiaries after
September 30, 1994 does not exceed $5,000,000;
it being understood that any such Investment that exceeds the amount
permitted by this clause (e) shall be permitted if the excess above such
amount is an Investment permitted by clause (g) of this Section;
(f) Temporary Cash Investments; and
(g) Investments in any of the Borrower's dealers or in any other
Person (except an Affiliate of the Borrower) not otherwise permitted to be
made pursuant to the preceding clauses of this Section; provided that the
aggregate amount of all such Investments made by Holdings, the Borrower and
the Borrower's Subsidiaries after September 30, 1994 does not exceed
$25,000,000.
56
<PAGE> 62
SECTION 5.16. Consolidated Capital Expenditures. (a) Unless the
Specified Covenant Release Date shall have occurred, the sum of Consolidated
Capital Expenditures and Sumitomo-Yale Investments will not exceed $45,000,000
for the Fiscal Year ending December 31, 1995 or $50,000,000 for any Fiscal Year
thereafter.
(b) Notwithstanding the foregoing limitation, if the sum of
Consolidated Capital Expenditures and Sumitomo-Yale Investments for any Fiscal
Year is less than the amount permitted by subsection (a) above, the difference
may be carried forward for one Fiscal Year (and for this purpose, Consolidated
Capital Expenditures and Sumitomo-Yale Investments in any subsequent Fiscal
Year shall be applied, first, to the amount permitted by subsection (a) for
such Fiscal Year and, second, to any such carry-forward amount from the
previous Fiscal Year).
SECTION 5.17. Accommodation Obligations. The Borrower will not,
and will not permit any Subsidiary to, create or become or be liable with
respect to any Accommodation Obligation, except:
(a) Accommodation Obligations existing on the date of this
Agreement and described in Exhibit N in an aggregate amount estimated not
to exceed $110,000,000;
(b) Accommodation Obligations directly or indirectly guaranteeing
Debt or Accommodation Obligations of any wholly- owned Subsidiary permitted
by Section 5.11;
(c) guaranty, recourse and repurchase obligations arising in
connection with the Operating Agreements on terms not materially less
favorable to the Borrower than those in effect as of the date hereof;
(d) obligations to repurchase unsold equipment and/or refurbish
and resell repossessed equipment and other similar obligations arising in
connection with inventory financing extended by certain financial
institutions to Hyster and Yale dealers;
(e) guaranties by the Borrower of the obligations of
Sumitomo-Yale as required by existing agreements between the Borrower and
Sumitomo-Yale;
(f) standby letters of credit issued for the account of the
Borrower in connection with industrial revenue bonds; and
(g) in addition to those permitted pursuant to the foregoing
clauses (a) through (f), Accommodation
57
<PAGE> 63
Obligations in an aggregate amount not to exceed $25,000,000 at any one
time outstanding.
SECTION 5.18. Transactions with Affiliates. The Borrower will
not, and will not permit any Subsidiary to, directly or indirectly, (i) pay any
funds to or for the account of, (ii) make any Investment in, (iii) lease, sell,
transfer or otherwise dispose of any assets, tangible or intangible, to, (iv)
enter into any Accommodation Obligation for the benefit of or (v) otherwise
participate in, or effect, any transaction with, any Affiliate except on an
arms-length basis on terms at least as favorable to the Borrower or such
Subsidiary as could have been obtained from a third party which was not an
Affiliate; provided that this Section shall not prohibit the Borrower or any
Subsidiary from (x) paying fees and allocated expenses to NACCO Industries not
exceeding $2,500,000 in any Fiscal Year or (y) subject to Section 5.14,
declaring or paying any lawful dividend or other payment ratably in respect of
all of its capital stock of the relevant class.
SECTION 5.19. Holdings. At all times prior to the Holdings
Merger, Holdings will have:
(i) no material assets other than (w) the common stock of the
Borrower, (x) rights under the Tax Sharing Agreement, (y) rights under Interest
Rate Contracts entered into as required by the Existing Credit Agreement, and
(z) tangible property having an aggregate book value not exceeding $500,000;
and
(ii) no material liabilities other than (v) the Subordinated
Debentures, (w) the Existing Term Loans (x) liabilities under the Tax Sharing
Agreement, (y) guarantees of obligations of the Borrower and (z) liabilities
under Interest Rate Contracts entered into as required by the Existing Credit
Agreement.
ARTICLE 6
DEFAULTS
SECTION 6.1. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any
Loan or fail to pay within three Domestic Business Days any interest,
facility fee or other amount payable hereunder;
58
<PAGE> 64
(b) the Borrower shall fail to observe or perform any covenant
contained in Article 5, other than those contained in Sections 5.1 through
5.6;
(c) the Borrower shall fail to observe or perform any covenant or
agreement contained in this Agreement (other than those covered by clause
(a) or (b) above) for 20 days after written notice thereof has been given
to the Borrower by the Agent at the request of any Bank;
(d) any representation, warranty, certification or statement made
by the Borrower in this Agreement or in any certificate, financial
statement or other document delivered pursuant to this Agreement shall
prove to have been incorrect in any material respect when made (or deemed
made);
(e) the Borrower or any Subsidiary shall fail to make any payment
in respect of Material Debt when due or within any applicable grace period;
(f) any event or condition shall occur which results in the
acceleration of the maturity of Material Debt or enables the holders of
such Material Debt or any Person acting on such holders' behalf to
accelerate the maturity thereof;
(g) the Borrower or any Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency
or other similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar official of
it or any substantial part of its property, or shall consent to any such
relief or to the appointment of or taking possession by any such official
in an involuntary case or other proceeding commenced against it, or shall
make a general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due, or shall take any corporate
action to authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Subsidiary seeking liquidation, reorganization
or other relief with respect to it or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property,
59
<PAGE> 65
and such involuntary case or other proceeding shall remain undismissed and
unstayed for a period of 60 days; or an order for relief shall be entered
against the Borrower or any Subsidiary under the federal bankruptcy laws as
now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an
amount or amounts aggregating in excess of $5,000,000 which it shall have
become liable to pay under Title IV of ERISA; or notice of intent to
terminate a Material Plan shall be filed under Title IV of ERISA by any
member of the ERISA Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings under Title IV of ERISA
to terminate, to impose liability (other than for premiums under Section
4007 of ERISA) in respect of, or to cause a trustee to be appointed to
administer any Material Plan; or a condition shall exist by reason of which
the PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated; or there shall occur a complete or
partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current
payment obligation in excess of $5,000,000;
(j) any judgments or order for the payment of money in excess of
$10,000,000 shall be rendered against the Borrower or any Subsidiary and
such judgment or order shall continue unsatisfied and unstayed for a period
of 30 days; or
(k) NACCO Industries shall no longer own, directly or indirectly,
more than 65% of the common stock of the Borrower;
then, and in every such event, the Agent shall (i) if requested by Banks having
more than 50% in aggregate amount of the Commitments, by notice to the Borrower
terminate the Commitments and they shall thereupon terminate, and (ii) if
requested by Banks holding more than 50% of the aggregate principal amount of
the Loans (calculated with respect to Alternative Currency Loans, if any, at
the Dollar Equivalents thereof), by notice to the Borrower declare the Loans
(together with accrued interest thereon) to be, and the Loans (together with
accrued interest thereon) shall thereupon become, immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower; provided that, if any Event of Default
specified in clause (g) or (h) above occurs with respect to the Borrower, then
without any notice to the Borrower or any other act by the Agent or the
60
<PAGE> 66
Banks, the Commitments shall thereupon terminate and the Loans (together with
accrued interest thereon) shall become immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.
SECTION 6.2. Notice of Default. The Agent shall give notice to
the Borrower under Section 6.1(c) promptly upon being requested to do so by any
Bank and shall thereupon notify all the Banks thereof.
ARTICLE 7
THE AGENT
SECTION 7.1. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement and the Notes as
are delegated to the Agent by the terms hereof or thereof, together with all
such powers as are reasonably incidental thereto.
SECTION 7.2. Agent and Affiliates. Morgan Guaranty Trust Company
of New York shall have the same rights and powers under this Agreement as any
other Bank and may exercise or refrain from exercising the same as though it
were not the Agent, and Morgan Guaranty Trust Company of New York and its
affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Borrower or any Subsidiary or affiliate of the
Borrower as if it were not the Agent.
SECTION 7.3. Action by Agent. The obligations of the Agent
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agent shall not be required to take any action
with respect to any Default, except as expressly provided in Article 6.
SECTION 7.4. Consultation with Experts. The Agent may consult
with legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.5. Liability of Agent. Neither the Agent nor any of
its affiliates nor any of their respective directors, officers, agents or
employees shall be liable for any action taken or not taken by it in connection
herewith
61
<PAGE> 67
(i) with the consent or at the request of the Required Banks or (ii) in the
absence of its own gross negligence or willful misconduct. Neither the Agent
nor any of its affiliates nor any of their respective directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with this Agreement or any borrowing hereunder; (ii) the performance
or observance of any of the covenants or agreements of the Borrower; (iii) the
satisfaction of any condition specified in Article 3, except receipt of items
required to be delivered to the Agent; or (iv) the validity, effectiveness or
genuineness of this Agreement, the Notes or any other instrument or writing
furnished in connection herewith. The Agent shall not incur any liability by
acting in reliance upon any notice, consent, certificate, statement, or other
writing (which may be a bank wire, telex, facsimile transmission or similar
writing) believed by it to be genuine or to be signed by the proper party or
parties.
SECTION 7.6. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify the Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement or any action
taken or omitted by such indemnitees hereunder.
SECTION 7.7. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 7.8. Successor Agent. The Agent may resign at any time
by giving notice thereof to the Banks and the Borrower. Upon any such
resignation, the Required Banks shall have the right to appoint a successor
Agent. If no successor Agent shall have been so appointed by the Required
Banks, and shall have accepted such appointment, within 30 days after the
retiring Agent gives notice of resignation, then the retiring Agent may, on
behalf of the Banks, appoint a successor Agent, which shall be a commercial
bank
62
<PAGE> 68
organized or licensed under the laws of the United States of America or of any
State thereof and having a combined capital and surplus of at least
$50,000,000. Upon the acceptance of its appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as Agent, the provisions of this Article
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent.
SECTION 7.9. Agent's Fees. The Borrower shall pay to the Agent
for its own account fees in the amounts and at the times previously agreed upon
between the Borrower and the Agent.
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.1. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period for any CD
Loan, Euro-Dollar Loan or Money Market LIBOR Loan:
(a) the Agent is advised by the Reference Banks that deposits in
dollars (in the applicable amounts) are not being offered to the Reference
Banks in the relevant market for such Interest Period, or
(b) in the case of CD Loans or Euro-Dollar Loans, Banks having
50% or more of the aggregate principal amount of the affected Loans advise
the Agent that the Adjusted CD Rate or the London Interbank Offered Rate,
as the case may be, as determined by the Agent will not adequately and
fairly reflect the cost to such Banks of funding their CD Loans or
Euro-Dollar Loans, as the case may be, for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, (i) the obligations of the Banks to
make CD Loans or Euro-Dollar Loans, as the case may be, or to continue or
convert outstanding Loans as or into CD Loans or Euro-Dollar Loans, as the case
may be, shall be suspended and (ii) each outstanding CD Loan or Euro-Dollar
Loan, as the case may be, shall be converted into a Base Rate Loan on the last
day of the then current Interest
63
<PAGE> 69
Period applicable thereto. Unless the Borrower notifies the Agent at least two
Domestic Business Days before the date of any Fixed Rate Borrowing for which a
Notice of Borrowing has previously been given that it elects not to borrow on
such date, (i) if such Fixed Rate Borrowing is a Committed Borrowing, such
Borrowing shall instead be made as a Base Rate Borrowing and (ii) if such Fixed
Rate Borrowing is a Money Market LIBOR Borrowing, the Money Market LIBOR Loans
comprising such Borrowing shall bear interest for each day from and including
the first day to but excluding the last day of the Interest Period applicable
thereto at the Base Rate for such day.
SECTION 8.2. Illegality. If, on or after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Euro-Dollar Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall make it unlawful or
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain
or fund its Euro-Dollar Loans and such Bank shall so notify the Agent, the
Agent shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Bank to make Euro-Dollar Loans, or to convert outstanding Loans into
Euro-Dollar Loans, shall be suspended. Before giving any notice to the Agent
pursuant to this Section, such Bank shall designate a different Euro-Dollar
Lending Office if such designation will avoid the need for giving such notice
and will not, in the judgment of such Bank, be otherwise disadvantageous to
such Bank. If such notice is given, each Euro-Dollar Loan of such Bank then
outstanding shall be converted to a Base Rate Loan either (a) on the last day
of the then current Interest Period applicable to such Euro-Dollar Loan if such
Bank may lawfully continue to maintain and fund such Loan to such day or (b)
immediately if such Bank shall determine that it may not lawfully continue to
maintain and fund such Loan to such day.
SECTION 8.3. Increased Cost and Reduced Return. (a) If on or
after (x) the date hereof, in the case of any Committed Loan or any obligation
to make Committed Loans or (y) the date of the related Money Market Quote, in
the case of any Money Market Loan or (z) the date of the related Alternative
Currency Quote, in the case of any Alternative Currency Loan, the adoption of
any applicable law, rule or
64
<PAGE> 70
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall impose, modify
or deem applicable any reserve (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve System,
but excluding (i) with respect to any CD Loan any such requirement included in
an applicable Domestic Reserve Percentage and (ii) with respect to any
Euro-Dollar Loan any such requirement with respect to which such Bank is
entitled to compensation during the relevant Interest Period under Section
2.18), special deposit, insurance assessment (excluding, with respect to any CD
Loan, any such requirement reflected in an applicable Assessment Rate) or
similar requirement against assets of, deposits with or for the account of, or
credit extended by, any Bank (or its Applicable Lending Office) or shall impose
on any Bank (or its Applicable Lending Office) or on the United States market
for certificates of deposit or the London interbank market any other condition
affecting its Fixed Rate Loans, its Note or its obligation to make Fixed Rate
Loans and the result of any of the foregoing is to increase the cost to such
Bank (or its Applicable Lending Office) of making or maintaining any Fixed Rate
Loan, or to reduce the amount of any sum received or receivable by such Bank
(or its Applicable Lending Office) under this Agreement or under its Note with
respect thereto, by an amount deemed by such Bank to be material, then, within
15 days after demand by such Bank (with a copy to the Agent), the Borrower
shall pay to such Bank such additional amount or amounts as will compensate
such Bank on an after-tax basis for such increased cost or reduction.
(b) If any Bank shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change in any such law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on capital of such Bank (or its Parent) as a consequence of such Bank's
obligations hereunder to a level below that which such Bank (or its Parent)
could have achieved but for such adoption, change, request or directive (taking
into consideration its policies
65
<PAGE> 71
with respect to capital adequacy) by an amount deemed by such Bank to be
material, then from time to time, within 15 days after demand by such Bank
(with a copy to the Agent), the Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank (or its Parent) on an after-tax
basis for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent of
any event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank to compensation pursuant to this Section and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. Any Bank
claiming compensation under this Section shall deliver to the Borrower a
certificate setting forth the additional amount or amounts to be paid to it
hereunder, showing the calculation thereof in reasonable detail, and such
certificate shall be conclusive in the absence of manifest error. In
determining such amount, such Bank may use any reasonable averaging and
attribution methods.
SECTION 8.4. Taxes. (a) For the purposes of this Section
8.4(a), the following terms have the following meanings:
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings with respect to any payment by the
Borrower pursuant to this Agreement or under any Note, and all liabilities with
respect thereto, excluding (i) in the case of each Bank and the Agent, taxes
imposed on its income, and franchise or similar taxes imposed on it, by a
jurisdiction under the laws of which such Bank or the Agent (as the case may
be) is organized or in which its principal executive office is located or, in
the case of each Bank, in which its Applicable Lending Office is located and
(ii) in the case of each Bank, any United States withholding tax imposed on
such payments but only to the extent that such Bank is subject to United States
withholding tax at the time such Bank first becomes a party to this Agreement.
"Other Taxes" means any present or future stamp or documentary
taxes and any other excise or property taxes, or similar charges or levies,
which arise from any payment made pursuant to this Agreement or under any Note
or from the execution or delivery of, or otherwise with respect to, this
Agreement or any Note.
(b) Any and all payments by the Borrower to or for the account of
any Bank or the Agent hereunder or under any Note shall be made without
deduction for any Taxes or Other Taxes; provided that, if the Borrower shall be
required by law to deduct any Taxes or
66
<PAGE> 72
Other Taxes; provided that, if the Borrower shall be required by law to deduct
any Taxes or Other Taxes from any such payments, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section) such
Bank or the Agent (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make such deductions, (iii) the Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with
applicable law and (iv) the Borrower shall furnish to the Agent, at its address
referred to in Section 9.1, the original or a certified copy of a receipt
evidencing payment thereof.
(c) The Borrower agrees to indemnify each Bank and the Agent for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section) paid by such Bank or the Agent (as the case may be) and any
liability (including penalties, interest and expenses) arising therefrom or
with respect thereto. This indemnification shall be paid within 15 days after
such Bank or the Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside
the United States, on or prior to the date of its execution and delivery of
this Agreement in the case of each Bank listed on the signature pages hereof
and on or prior to the date on which it becomes a Bank in the case of each
other Bank, and from time to time thereafter if requested in writing by the
Borrower (but only so long as such Bank remains lawfully able to do so), shall
provide the Borrower with Internal Revenue Service form 1001 or 4224, as
appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Bank is entitled to benefits under an income tax treaty to
which the United States is a party which exempts such Bank from United States
withholding tax or reduces the rate of withholding tax on payments of interest
for the account of such Bank or certifying that the income receivable pursuant
to this Agreement is effectively connected with the conduct of a trade or
business in the United States.
(e) For any period with respect to which a Bank has failed to
provide the Borrower with the appropriate form pursuant to Section 8.4(d)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which such form originally was required to be
provided), such Bank shall not be entitled to indemnification under Section
8.4(b) or (c) with respect to Taxes imposed by the United States; provided that
if a Bank,
67
<PAGE> 73
which is otherwise exempt from or subject to a reduced rate of withholding tax,
becomes subject to Taxes because of its failure to deliver a form required
hereunder, the Borrower shall take such steps as such Bank shall reasonably
request to assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to or
for the account of any Bank pursuant to this Section, such Bank will change the
jurisdiction of its Applicable Lending Office if, in the judgment of such Bank,
such change (i) will eliminate or reduce any such additional payment which may
thereafter accrue and (ii) is not otherwise disadvantageous to such Bank.
SECTION 8.5. Base Rate Loans Substituted for Affected Fixed Rate
Loans. If (i) the obligation of any Bank to make, or convert outstanding Loans
to, Euro-Dollar Loans has been suspended pursuant to Section 8.2 or (ii) any
Bank has demanded compensation under Section 8.3 or 8.4 with respect to its CD
Loans or Euro-Dollar Loans and the Borrower shall, by at least five Euro-Dollar
Business Days' prior notice to such Bank through the Agent, have elected that
the provisions of this Section shall apply to such Bank, then, unless and until
such Bank notifies the Borrower that the circumstances giving rise to such
suspension or demand for compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank as (or
continued as or converted into) CD Loans or Euro-Dollar Loans, as the case
may be, shall instead be Base Rate Loans (on which interest and principal
shall be payable contemporaneously with the related Fixed Rate Loans of the
other Banks); and
(b) after each of its CD Loans or Euro-Dollar Loans, as the case
may be, has been repaid (or converted to a Base Rate Loan), all payments of
principal which would otherwise be applied to repay such Fixed Rate Loans
shall be applied to repay its Base Rate Loans instead.
If such Bank notifies the Borrower that the circumstances giving rise to such
notice no longer apply, the principal amount of each such Base Rate Loan shall
be converted into a CD Loan or Euro-Dollar Loan, as the case may be, on the
first day of the next succeeding Interest Period applicable to the related CD
Loans or Euro-Dollar Loans of the other Banks.
SECTION 8.6. Substitution of Bank. (a) If (i) the obligation of
any Bank to make Fixed Rate Loans has been suspended pursuant to Section 8.2,
(ii) any Bank has demanded compensation under Section 8.3 or 8.4 or (iii) on
68
<PAGE> 74
any Extension Date any Bank has not agreed to extend its Termination Date and
Banks having at least 75% of the aggregate amount of the Commitments have
agreed to extend their Termination Dates, the Borrower shall have the right,
with the assistance of the Agent, to seek a mutually satisfactory substitute
bank or banks (which may be one or more of the Banks) to purchase the
outstanding Committed Loans and assume the Commitment of such Bank. Such
substitute bank or banks are herein called "Substitute Banks" and the Bank for
which they are to be substituted is herein called a "Replaced Bank".
(b) A Replaced Bank shall sell its outstanding Committed Loans
(if any) and assign its Commitment to the relevant Substitute Bank or Banks
upon receiving:
(i) at least three Domestic Business Days' notice of such sale
from the Borrower;
(ii) payment in immediately available funds of an amount equal to
the principal amount of such Loans plus interest accrued thereon to the
date of such sale; and
(iii) two copies of an Assignment and Assumption Agreement, in
substantially the form of Exhibit J hereto, appropriately completed and
signed by each such Substitute Bank.
(c) In connection with any such sale and assignment:
(i) the Replaced Bank shall sign and return to each such
Substitute Bank a copy of the Assignment and Assumption Agreement signed by
it;
(ii) the Borrower shall compensate the Replaced Bank for its
funding losses, if any, as required by Section 2.16;
(iii) the Agent shall remit to the Replaced Bank any facility fee
accrued for the account of such Replaced Bank to but excluding the date of
such sale, upon receipt by the Agent of such facility fee from the
Borrower; and
(iv) unless otherwise agreed by it at the time, the Replaced Bank
shall retain its rights hereunder with respect to any Money Market Loans
and Alternative Currency Loans made by it and any amounts payable to it
hereunder (other than the principal amount of its Committed Loans, interest
accrued thereon and, subject to clause (iii) above, facility fees).
69
<PAGE> 75
ARTICLE 9
MISCELLANEOUS
SECTION 9.1. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to such
party: (a) in the case of the Borrower or the Agent, at its address, facsimile
number or telex number set forth on the signature pages hereof, (b) in the case
of any Bank, at its address, facsimile number or telex number set forth in its
Administrative Questionnaire or (c) in the case of any party, such other
address, facsimile number or telex number as such party may hereafter specify
for the purpose by notice to the Agent and the Borrower. Each such notice,
request or other communication shall be effective (i) if given by telex, when
such telex is transmitted to the telex number specified in this Section and the
appropriate answerback is received, (ii) if given by facsimile transmission,
when transmitted to the facsimile number specified in this Section and
confirmation of receipt is received, (iii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iv) if given by any other means, when delivered at
the address referred to in this Section; provided that (A) notices to the Agent
under Article 2 or Article 8 shall not be effective until received and (B)
notices to the Agent or the Borrower under Article 2 may be given by telephone
promptly confirmed in writing by facsimile transmission.
SECTION 9.2. No Waivers. No failure or delay by the Agent or any
Bank in exercising any right, power or privilege hereunder or under any Note
shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 9.3. Expenses; Indemnification. (a) The Borrower shall
pay (i) all out-of-pocket expenses of the Agent, including reasonable fees and
disbursements of special counsel for the Agent, in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all out-of-pocket expenses incurred by
the Agent and each Bank, including (without duplication) the fees and
disbursements of outside counsel and the allocated cost of
70
<PAGE> 76
inside counsel, in connection with such Event of Default and any collection,
bankruptcy, insolvency and other enforcement proceedings resulting therefrom.
(b) The Borrower shall indemnify the Agent and each Bank, their
respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, claims, damages,
costs and expenses of any kind, including, without limitation, the reasonable
fees and disbursements of counsel and settlement costs, which may be incurred
by such Indemnitee in connection with any investigative, administrative or
judicial proceeding (whether or not such Indemnitee shall be designated a party
thereto) brought or threatened relating to or arising out of this Agreement or
any actual or proposed use of proceeds of Loans hereunder; provided that no
Indemnitee shall have the right to be indemnified hereunder for such
Indemnitee's own gross negligence or willful misconduct as determined by a
court of competent jurisdiction.
SECTION 9.4. Sharing of Set-Offs. Each Bank agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Dollar-Denominated Loan held by it which is greater than
the proportion received by any other Bank in respect of the aggregate amount of
principal and interest due with respect to any Dollar-Denominated Loan held by
such other Bank, the Bank receiving such proportionately greater payment shall
purchase such participations in the Dollar-Denominated Loans held by the other
Banks, and such other adjustments shall be made, as may be required so that all
such payments of principal and interest with respect to the Dollar- Denominated
Loans held by the Banks shall be shared by the Banks pro rata; provided that
nothing in this Section shall impair the right of any Bank to exercise any
right of set-off or counterclaim it may have and to apply the amount subject to
such exercise to the payment of obligations of the Borrower other than its
Dollar-Denominated Loans hereunder. The Borrower agrees, to the fullest extent
it may effectively do so under applicable law, that any holder of a
participation in a Dollar-Denominated Loan, whether or not acquired pursuant to
the foregoing arrangements, may exercise rights of set-off or counterclaim and
other rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount of such
participation.
SECTION 9.5. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or
71
<PAGE> 77
waived if, but only if, such amendment or waiver is in writing and is signed by
the Borrower and the Required Banks (and, if the rights or duties of the Agent
are affected thereby, by the Agent); provided that no such amendment or waiver
shall, unless signed by all the Banks, (a) increase or decrease the Commitment
of any Bank (except for a ratable decrease in the Commitments of all Banks) or
subject any Bank to any additional obligation, (b) reduce the principal of or
rate of interest on any Loan, or any fees hereunder, (c) postpone the date
fixed for any payment of principal of or interest on any Loan, or any fees
hereunder or for the termination of any Commitment, (d) change the percentage
of the Commitments or of the aggregate unpaid principal amount of the Loans, or
the number of Banks, which shall be required for the Banks or any of them to
take any action under this Section or any other provision of this Agreement or
(e) change any provision of this Section 9.5.
SECTION 9.6. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that the Borrower may not
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of all the Banks.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment
or any or all of its Loans; provided that the transferability of voting rights
is limited to changes in principal, rate, fees and term of Loans under this
Agreement. If any Bank grants such a participating interest to a Participant,
whether or not upon notice to the Borrower and the Agent, such Bank shall
remain responsible for the performance of its obligations hereunder, and the
Borrower and the Agent shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this
Agreement. Any agreement pursuant to which any Bank may grant such a
participating interest shall provide that such Bank shall retain the sole right
and responsibility to enforce the obligations of the Borrower hereunder
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement; provided that such participation
agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement described in clause(a),(b) or (c) of
Section 9.5 without the consent of the Participant. The Borrower agrees that
each Participant shall, to the extent provided in its participation agreement,
be entitled to the benefits of Section 2.18 or Article 8 with respect to its
participating interest. An assignment or other transfer which is not permitted
by subsection (c) or (d) below shall be given
72
<PAGE> 78
effect for purposes of this Agreement only to the extent of a participating
interest granted in accordance with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part (equivalent to
an initial Commitment of not less than $10,000,000) of all, of its rights and
obligations under this Agreement and the Notes, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Assumption Agreement
in substantially the form of Exhibit J hereto executed by such Assignee and
such transferor Bank, with (and subject to) the subscribed consent of the
Borrower and the Agent (which consents shall not be unreasonably withheld or
delayed); provided that if an Assignee is an affiliate of such transferor Bank
or was a Bank immediately prior to such assignment, no such consent shall be
required; and provided further that such assignment may, but need not, include
rights of the transferor Bank in respect of outstanding Money Market Loans and
Alternative Currency Loans. Upon execution and delivery of such instrument and
payment by such Assignee to such transferor Bank of an amount equal to the
purchase price agreed between such transferor Bank and such Assignee, such
Assignee shall be a Bank party to this Agreement and shall have all the rights
and obligations of a Bank with a Commitment as set forth in such instrument of
assumption, and the transferor Bank shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required. Upon the consummation of any assignment pursuant to
this subsection (c), the transferor Bank, the Agent and the Borrower shall make
appropriate arrangements so that, if required, a new Note is issued to the
Assignee. In connection with any such assignment, the transferor Bank shall
pay to the Agent an administrative fee for processing such assignment in the
amount of $2,500. If the Assignee is not incorporated under the laws of the
United States or a state thereof, it shall deliver to the Borrower and the
Agent certification as to exemption from deduction or withholding of any United
States federal income taxes in accordance with Section 8.4.
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Note to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's
rights shall be entitled to receive any greater payment under Section 8.3 or
8.4 than such Bank would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrower's prior
written consent or by reason of the
73
<PAGE> 79
provisions of Section 8.2, 8.3 or 8.4 requiring such Bank to designate a
different Applicable Lending Office under certain circumstances or, in the case
of an Assignee, at a time when the circumstances giving rise to such greater
payment did not exist.
SECTION 9.7. Collateral. Each of the Banks represents to the
Agent and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 9.8. Release of Existing Security Interests and Existing
Guaranties. The parties hereto that are also parties to the Existing Credit
Agreement, the Existing Security Agreements or the Existing Guaranties agree
that, concurrently with the closing hereunder on the Closing Date, without any
further action by any party thereto:
(i) the commitments of the banks under the Existing Credit
Agreement shall terminate;
(ii) the security interests created by the Existing Security
Agreements shall be released and the Agent (as such term is defined
therein) shall deliver the stock certificates and other instruments pledged
thereunder to the Borrower or Holdings, as the case may be;
(iii) the Existing Guaranties shall terminate; and
(iv) the obligations of Holdings and the Borrower to comply
with the covenants set forth in Article VIII of the Existing Credit
Agreement shall terminate.
SECTION 9.9. Confidentiality. The Agent and each Bank agrees to
keep any information delivered or made available by the Borrower pursuant to
this Agreement confidential from anyone other than persons employed or retained
by such Bank who are engaged in evaluating, approving, structuring or
administering the credit facility contemplated hereby; provided that nothing
herein shall prevent any Bank from disclosing such information (a) to any other
Bank or to the Agent, (b) to any other Person if reasonably incidental to the
administration of the credit facility contemplated hereby, (c) upon the order
of any court or administrative agency, (d) upon the request or demand of any
regulatory agency or authority, (e) which had been publicly disclosed other
than as a result of a disclosure by the Agent or any Bank prohibited by this
Agreement, (f) in connection with any litigation to which the Agent or any Bank
(or any affiliate of any Bank) may be
74
<PAGE> 80
a party, (g) to the extent necessary in connection with the exercise of any
remedy hereunder, (h) to such Bank's or Agent's legal counsel and independent
auditors and (i) subject to provisions substantially similar to those contained
in this Section, to any actual or proposed Participant or Assignee.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 9.11. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
SECTION 9.12. Counterparts; Integration; Effectiveness. This
Agreement may be signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof. This Agreement shall become effective upon receipt by the Agent of
counterparts hereof signed by each of the parties hereto (or, in the case of
any party as to which an executed counterpart shall not have been received,
receipt by the Agent in form satisfactory to it of telegraphic, telex,
facsimile or other written confirmation from such party of execution of a
counterpart hereof by such party).
75
<PAGE> 81
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers as of the day and
year first above written.
NACCO MATERIALS HANDLING GROUP, INC.
By ___________________________
Name: Jeffrey C. Mattern
Title: Treasurer
Address: 2701 N.W. Vaughn
Suite 900 (97210)
P.O. Box 2902
Portland, Oregon 97208
Facsimile: 503-721-6197
76
<PAGE> 82
Commitments
$35,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By ___________________________
Name:
Title:
$25,000,000 BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By ___________________________
Name:
Title:
$25,000,000 THE BANK OF NOVA SCOTIA, as a
Co-Agent and a Bank
By ___________________________
Name:
Title:
$25,000,000 CITIBANK, N.A.
By ___________________________
Name:
Title:
$25,000,000 THE LONG-TERM CREDIT BANK OF
JAPAN, LTD., as a Co-Agent
and a Bank
By ___________________________
Name:
Title:
$20,000,000 THE BANK OF CALIFORNIA, N.A.,
as a Co-Agent and a Bank
77
<PAGE> 83
By ___________________________
Name:
Title:
$20,000,000 THE FIRST NATIONAL BANK OF
CHICAGO, as a Co-Agent
and a Bank
By ___________________________
Name:
Title:
$20,000,000 ROYAL BANK OF CANADA, as a Co-Agent
and a Bank
By ___________________________
Name:
Title:
$17,500,000 THE BANK OF TOKYO, LTD.
PORTLAND BRANCH
By ___________________________
Name:
Title:
$17,500,000 UNITED STATES NATIONAL BANK OF
OREGON
By ___________________________
Name:
Title:
$15,000,000 BANK OF SCOTLAND
By ___________________________
78
<PAGE> 84
Name:
Title:
$15,000,000 FIRST INTERSTATE BANK OF
OREGON, N.A.
By ___________________________
Name:
Title:
$15,000,000 ISTITUTO BANCARIO SAN PAOLO
DI TORINO S.P.A.
By ___________________________
Name:
Title:
$15,000,000 MELLON BANK, N.A.
By ___________________________
Name:
Title:
$15,000,000 SOCIETY NATIONAL BANK
By ___________________________
Name:
Title:
$12,500,000 CAISSE NATIONALE DE CREDIT
AGRICOLE
By ___________________________
79
<PAGE> 85
Name:
Title:
$12,500,000 THE CHASE MANHATTAN BANK, N.A.
By ___________________________
Name:
Title:
$10,000,000 STAR BANK, N.A.
By ___________________________
Name:
Title:
$10,000,000 THE SUMITOMO BANK, LTD.
By ___________________________
Name:
Title:
=================
Total Commitments
-----------------
$350,000,000
-----------------
80
<PAGE> 86
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By ___________________________
Name:
Title:
Address: 60 Wall Street
New York, NY 10260
Telex: 17615MGT UT
Facsimile: (212) 648-5336
81
<PAGE> 87
PRICING SCHEDULE
Subject to the last sentence of this Pricing Schedule, each of
the terms "Facility Fee Rate", "Euro-Dollar Margin" and "CD Margin" means, for
any day, the rate per annum set forth below in the row opposite such term and
in the column corresponding to the Pricing Level that applies on such day:
<TABLE>
<CAPTION>
Pricing Level Level I Level II Level III Level IV Level V
<S> <C> <C> <C> <C> <C>
Facility Fee 0.1500% 0.1875% 0.2500% 0.3000% 0.3750%
Rate
Euro-Dollar 0.3250% 0.4125% 0.6250% 0.7000% 0.8750%
Margin
CD Margin 0.4500% 0.5350% 0.7500% 0.8250% 1.000%
</TABLE>
For purposes of this Pricing Schedule, the following terms have
the following meanings:
"Average Debt Ratio" means, for any Fiscal Quarter, the ratio of
(i) Average Total Debt during such Fiscal Quarter to (ii) the sum of (x) such
Average Total Debt plus (y) Consolidated Net Worth at the end of such Fiscal
Quarter.
"Average Total Debt" means, for any Fiscal Quarter, the sum of (i)
the daily average amount of Debt of the Borrower and its domestic Subsidiaries
outstanding during such Fiscal Quarter and (ii) the quotient obtained by
dividing (x) the sum of the amount of Debt of the Borrower's foreign
Subsidiaries outstanding at the end of each month included in such Fiscal
Quarter by (y) the number of months included in such Fiscal Quarter; provided
that for purposes of this definition the term "Debt" does not include Debt owed
by the Borrower to any Subsidiary or Debt owed by any Subsidiary to the
Borrower or to another Subsidiary.
"Level I Pricing" applies during any Rate Period if the Average
Debt Ratio for the Preceding Fiscal Quarter was less than or equal to 0.37 to
1.
"Level II Pricing" applies during any Rate Period if the Average
Debt Ratio for the Preceding Fiscal Quarter was greater than 0.37 to 1 but less
than or equal to 0.42 to 1.
"Level III Pricing" applies during any Rate Period if the Average
Debt Ratio for the Preceding Fiscal Quarter was greater than 0.42 to 1 but less
than or equal to 0.47 to 1.
<PAGE> 88
"Level IV Pricing" applies during any Rate Period if the Average
Debt Ratio for the Preceding Fiscal Quarter was greater than 0.47 to 1 but less
than or equal to 0.52 to 1.
"Level V Pricing" applies during any Rate Period if the Average
Debt Ratio for the Preceding Fiscal Quarter was greater than 0.52 to 1.
"Preceding Fiscal Quarter" means, with respect to any Rate Period,
the most recent Fiscal Quarter ended before such Rate Period begins.
"Rate Period" means any period from and including the 46th day of
a Fiscal Quarter to and including the 45th day of the immediately succeeding
Fiscal Quarter.
If at the end of any Fiscal Quarter ending on or after June 30,
1995 the Interest Coverage Ratio is equal to or less than 3.25 to 1, (i) the
Facility Fee Rate applicable during the Rate Period that begins on the 46th day
of the following Fiscal Quarter shall be 0.125% per annum higher than the
applicable rate shown in the table above and (ii) the Euro-Dollar Margin and CD
Margin applicable during such Rate Period shall each be 0.750% per annum higher
than the applicable rate shown in the table above.
2
<PAGE> 89
EXHIBIT A
NOTE
New York, New York ___________ __, 199_
For value received, NACCO Materials Handling Group, Inc., a
Delaware corporation (the "Borrower"), promises to pay to the order of
______________________ (the "Bank"), for the account of its Applicable Lending
Office, the unpaid principal amount of each Loan made by the Bank to the
Borrower pursuant to the Credit Agreement referred to below on the maturity
date provided for in the Credit Agreement. The Borrower promises to pay
interest on the unpaid principal amount of each such Loan on the dates and at
the rate or rates provided for in the Credit Agreement. All such payments of
principal and interest with respect to Dollar- Denominated Loans shall be made
in lawful money of the United States in Federal or other immediately available
funds at the office of Morgan Guaranty Trust Company of New York, 60 Wall
Street, New York, New York. All such payments of principal and interest with
respect to Alternative Currency Loans shall be made in the Alternative Currency
in which such Alternative Currency Loan was made in funds customary for the
settlement of international transactions in such Alternative Currency at the
time of any such payment, at the time and place notified by the Bank to the
Borrower.
All Loans made by the Bank, the respective types, currencies and
maturities thereof and all repayments of the principal thereof shall be
recorded by the Bank and, if the Bank so elects in connection with any transfer
or enforcement hereof, appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding may be endorsed by
the Bank on the schedule attached hereto, or on a continuation of such schedule
attached to and made a part hereof; provided that neither the failure of the
Bank to make any such recordation or endorsement nor any error in any such
recordation or endorsement shall affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This note is one of the Notes referred to in the Credit Agreement
dated as of February 28, 1995 among NACCO Materials
<PAGE> 90
Handling Group, Inc., the banks party thereto and Morgan Guaranty Trust Company
of New York, as Agent (as the same may be amended from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the
same meanings. Reference is made to the Credit Agreement for provisions for the
prepayment hereof and the acceleration of the maturity hereof.
NACCO MATERIALS HANDLING GROUP,
INC.
By____________________
Name:
Title:
2
<PAGE> 91
<TABLE>
<CAPTION>
LOANS AND PAYMENTS OF PRINCIPAL
<S> <C> <C> <C>
Currency Amount of
and Amount Principal Notation
Date of Loan Repaid Made By
</TABLE>
--------------------------------------------------------------------------
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
3
<PAGE> 92
EXHIBIT B
Form of Money Market Quote Request
[Date]
To: Morgan Guaranty Trust Company of New York (the "Agent")
From: NACCO Materials Handling Group, Inc.
Re: Credit Agreement (the "Credit Agreement") dated as of February
28, 1995 among NACCO Materials Handling Group, Inc., the Banks
parties thereto and the Agent
We hereby give notice pursuant to Section 2.4 of the Credit
Agreement that we request Money Market Quotes for the following proposed Money
Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount(1) Interest Period(2)
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Terms used herein have the meanings assigned to them in the
Credit Agreement.
NACCO MATERIALS HANDLING GROUP, INC.
____________________
(1) Amount must be at least $5,000,000.
(2) Not less than one month (LIBOR Auction) or not less than 7
days (Absolute Rate Auction), subject to the provisions of the definition
of Interest Period.
<PAGE> 93
By________________________
Name:
Title:
2
<PAGE> 94
EXHIBIT C
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes to NACCO Materials Handling Group,
Inc. (the "Borrower")
Pursuant to Section 2.4 of the Credit Agreement dated as of
February 28, 1995 among NACCO Materials Handling Group, Inc., the Banks parties
thereto and the undersigned, as Agent, we are pleased on behalf of the Borrower
to invite you to submit Money Market Quotes to the Borrower for the following
proposed Money Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount Interest Period
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Please respond to this invitation by no later than [2:00 P.M.]
[9:30 A.M.] (New York City time) on [date].
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By______________________
Authorized Officer
<PAGE> 95
EXHIBIT D
Form of Money Market Quote
To: Morgan Guaranty Trust Company of New York, as Agent
Re: Money Market Quote to NACCO Materials Handling Group, Inc. (the
"Borrower")
In response to your invitation on behalf of the Borrower dated
_____________, 19__, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank: ________________________________
2. Person to contact at Quoting Bank:
_____________________________
3. Date of Borrowing: ____________________*
4. We hereby offer to make Money Market Loan(s) in the following
principal amounts, for the following Interest Periods and at the
following rates:
<TABLE>
<CAPTION>
Principal Interest Money Market
Amount** Period*** [Margin****] [Absolute Rate*****]
-------- --------- ---------------------------------
<S> <C> <C>
$
$
</TABLE>
[provided that the aggregate principal amount of Money Market Loans
for which the above offers may be accepted shall not exceed
$____________.]**
__________
* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate
(notes continued on following page)
We understand and agree that the offer(s) set forth
above, subject to the satisfaction of the applicable conditions set
forth in the Credit Agreement
<PAGE> 96
dated as of February 28, 1995 among NACCO Materials Handling Group,
Inc., the Banks parties thereto and yourselves, as Agent, irrevocably
obligates us to make the Money Market Loan(s) for which any offer(s)
are accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated:_______________ By:________________________
Authorized Officer
__________
limitation if the sum of the individual offers exceeds the amount the Bank is
willing to lend. Bids must be made for $5,000,000 or a larger multiple of
$1,000,000.
*** Not less than one month or not less than 30 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
**** Margin over or under the London Interbank Offered Rate determined for
the applicable Interest Period. Specify percentage (to the nearest 1/10,000
of 1%) and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
2
<PAGE> 97
EXHIBIT E
Form of Alternative Currency Quote Request
[Date]
To: Morgan Guaranty Trust Company of New York
(the "Agent")
From: NACCO Materials Handling Group, Inc.
Re: Credit Agreement (the "Credit Agreement") dated as of February 28,
1995 among NACCO Materials Handling Group, Inc., the Banks parties
thereto and the Agent
We hereby give notice pursuant to Section 2.5 of the Credit
Agreement that we request Alternative Currency Quotes for the following
proposed Alternative Currency Borrowing(s):
Date of Alternative Currency Borrowing(s): _____________
Principal Amount Alternative Currency Interest Period
<PAGE> 98
Terms used herein have the meanings assigned to them in the
Credit Agreement.
NACCO MATERIALS HANDLING
GROUP, INC.
By ______________________
Name:
Title:
2
<PAGE> 99
EXHIBIT F
Form of Alternative Currency Quote
To: NACCO Materials Handling Group, Inc.
(the "Borrower")
Re: Alternative Currency Quote
In response to your Alternative Currency Quote Request dated
_____________, ____, we hereby make the following Alternative Currency Quote on
the following terms:
1. Quoting Bank: ________________________________
2. Person to contact at Quoting Bank:
__________________________________
3. Alternative Currency Lending Office: _____________
4. Date of Alternative Currency Borrowing(s):
____________________*
________________
* As specified in the related Alternative Currency Quote Request.
<PAGE> 100
EXHIBIT G
OPINION OF
JONES, DAY, REAVIS & POGUE
SPECIAL COUNSEL FOR THE BORROWER
[dated the Closing Date]
To the Lenders party to the Credit
Agreement referred to below and
Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Ladies and Gentlemen:
We have acted as counsel for NACCO Materials Handling Group,
Inc. (the "Borrower") in connection with the execution and delivery of the
Credit Agreement dated as of February 28, 1995 (the "Credit Agreement") among
the Borrower, the financial institutions named therein (the "Lenders") and
Morgan Guaranty Trust Company of New York, a New York banking corporation
("Morgan") as agent for the Lenders (in such capacity, the "Agent"), providing
for loans to the Borrower not exceeding $350,000,000 in aggregate outstanding
principal amount.
This opinion is being furnished to the Agent and the Lenders
pursuant to Section 3.1(b) of the Credit Agreement. Capitalized terms used but
not defined herein shall have the respective meanings ascribed to such terms in
the Credit Agreement.
In connection with this opinion, we have examined originals or
certified copies of the following documents:
(i) the Credit Agreement; and
(ii) the Notes.
In addition, we have examined such documents, records and
matters of law as we have deemed necessary for purposes of this opinion. As to
any facts material to our opinions expressed below, we have relied, without
independent verification, on certificates of public officials or certificates
and representations of officers or
<PAGE> 101
other representatives of the Borrower. For purposes of this opinion, we have
assumed the authenticity of all documents submitted to us as originals and the
conformity with the originals of all documents submitted to us as copies. Our
opinions expressed below are limited to the federal laws of the United States of
America, the laws of the State of New York and the General Corporation Law of
the State of Delaware.
Based on the foregoing, and subject to the qualifications set
forth herein, we are of the opinion that:
1. The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
2. The Borrower has the corporate power and authority
(i) to own its property and assets and to conduct its business and (ii) to
execute, deliver and perform its obligations under the Credit Agreement and
Notes and to borrow under the Credit Agreement.
3. The Credit Agreement and the Notes have been duly
executed and delivered by the Borrower and constitute the valid and binding
obligations of the Borrower, enforceable against the Borrower in accordance
with their respective terms.
4. The execution, delivery and performance by the
Borrower of the Credit Agreement and the Notes and the borrowings under the
Credit Agreement (a) have been duly authorized by all requisite action of the
directors of the Borrower and (b) will not violate (i) any law or statute
applicable to or binding upon the Borrower, or, to our actual knowledge, any
rule or regulation of any governmental body, agency or official applicable to
or binding upon the Borrower or (ii) the Certificate of Incorporation or
By-laws of the Borrower.
5. To our actual knowledge after due inquiry, no
authorization, consent, approval, license, exemption or other action by, and no
registration, qualification, designation, declaration or filing with, any
governmental body, agency or official of the State of New York or of the United
States is necessary in connection with the transactions contemplated by the
Credit Agreement and the Notes.
2
<PAGE> 102
6. The application of the proceeds of the Loans and the
consummation of the transactions contemplated by the Credit Agreement and the
Notes in accordance with the terms of the Credit Agreement will not result in
any violation of Regulation U of the Board of Governors of the Federal Reserve
System.
The opinions set forth above are subject to the following
additional limitations, qualifications and exceptions with respect to the
enforceability of any document referred to therein:
(a) applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or similar laws affecting creditors'
rights generally; and
(b) limitations and exceptions which may arise under
general principles of equity (regardless of whether such issues are
considered in a proceeding in equity or at law) with respect to the
availability of specific equitable remedies (such as the remedy of
specific performance).
We express no opinion as to the enforceability of exculpation
and indemnity clauses and clauses purporting to waive unmatured rights to the
extent that any of the aforementioned clauses are determined to be against the
public policy of the State of New York or the United States of America, any
provisions of the documents referred to in this opinion purporting to allow any
party to make determinations in its sole discretion and clauses purporting to
preclude the amendment or waiver of obligations except by an instrument in
writing, insofar as any of the foregoing are contained in any of the Credit
Agreement or the Notes. Whenever our opinion is limited "to our actual
knowledge," we have, in rendering such opinion, relied exclusively, as to
factual matters, without independent investigation, on our review of the Credit
Agreement and the Notes and on certificates of public officials and/or
certificates of officers or other representatives of the Borrower with respect
to the matters contained in such opinion.
Finally, with the exception of our opinion regarding
Regulation U set forth above, we express no opinion as to the effect of the
compliance or noncompliance of the Lenders or the Agent with any state or
federal laws or regulations applicable to the Lenders or the Agent by reason of
such Person's status as or affiliation with a federally insured depository
institution.
3
<PAGE> 103
This opinion is rendered only to the addressees hereof and is
solely for their benefit. This opinion may not be relied upon by any other
person, firm or corporation for any purpose without our prior written consent.
We are not assuming any professional responsibility to any other person by
rendering this opinion. Each of the matters set forth in this opinion is as of
the date hereof, and we undertake no, and hereby disclaim any, obligation to
advise you of any change in any matters set forth herein or in any matters on
which this opinion is based.
Very truly yours,
Jones, Day, Reavis & Pogue
4
<PAGE> 104
EXHIBIT H
OPINION OF BERGEN I. BULL, ESQ.,
GENERAL COUNSEL FOR THE BORROWER
[dated the Closing Date]
To the Lenders party to the Credit
Agreement referred to below and
Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Ladies and Gentlemen:
I am Vice President, General Counsel and Secretary of NACCO
Materials Handling Group, Inc., a Delaware corporation (the "Borrower"), and
have acted as such in connection with the execution and delivery of the Credit
Agreement dated as of February 28, 1995 (the "Credit Agreement") among the
Borrower, the financial institutions named therein (the "Lenders"), and Morgan
Guaranty Trust Company of New York, a New York banking corporation ("Morgan"),
as agent for the Lenders (in such capacity, the "Agent"), providing for loans
to the Borrower not exceeding $350,000,000 in aggregate outstanding principal
amount.
This opinion is being furnished to you pursuant to Section
3.1(c) of the Credit Agreement. Capitalized terms used but not defined herein
shall have the respective meanings ascribed to such terms in the Credit
Agreement.
In connection with this opinion, I have examined originals or
certified copies of the following documents:
(i) the Credit Agreement; and
(ii) the Notes.
In addition, I have examined such documents, records and
matters of law as I have deemed necessary for purposes of this opinion. As to
any facts material to my opinions expressed below, I have relied, without
independent verification, on certificates of public officials or certificates
and representations of officers or other representatives of the Borrower. For
purposes of this opinion, I have assumed the authenticity of all documents
submitted to me as originals and the conformity with the originals of all
documents submitted to me as copies.
<PAGE> 105
Based on the foregoing, and subject to the qualifications set
forth herein, I am of the opinion that:
1. The execution, delivery and performance by the
Borrower of the Credit Agreement and the Notes and the borrowings under the
Credit Agreement will not violate any agreement, judgment, injunction, order,
decree or other instrument binding upon the Borrower or any Subsidiary or
result in the creation or imposition of any Lien on any asset of the Borrower
or any Subsidiary.
2. There is no action, suit or proceeding pending or, to
the best of my knowledge, threatened against or affecting the Borrower or any
Subsidiary by or before any arbitrator, court or any governmental body or
agency or official which, if adversely determined, would have a material
adverse effect on the business, financial condition, operations or properties
of the Borrower and its Subsidiaries, or which in any manner draws into
question the validity of the Credit Agreement or the Note.
I am admitted to the practice of law in the State of Oregon
and no other jurisdiction.
This opinion is rendered only to the addressees hereof and is
solely for their benefit. This opinion may not be relied upon by any other
person, firm or corporation for any purpose without my prior written consent.
I am not assuming any professional responsibility to any other person by
rendering this opinion. Each of the matters set forth in this opinion is as of
the date hereof, and I undertake no, and hereby disclaim any, obligation to
advise you of any change in any matters set forth herein or in any matters on
which this opinion is based.
Very truly yours,
Bergen I. Bull
Vice President, General Counsel and
Secretary
2
<PAGE> 106
EXHIBIT I
OPINION OF
DAVIS POLK & WARDWELL, SPECIAL COUNSEL
FOR THE AGENT
[dated the Closing Date]
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
We have participated in the preparation of the Credit
Agreement (the "Credit Agreement") dated as of February 28, 1995 among NACCO
Materials Handling Group, Inc., a Delaware corporation (the "Borrower"), the
banks listed on the signature pages thereof (the "Banks") and Morgan Guaranty
Trust Company of New York, as Agent (the "Agent") and have acted as special
counsel for the Agent for the purpose of rendering this opinion pursuant to
Section 3.1(d) of the Credit Agreement. Terms defined in the Credit Agreement
are used herein as therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes are within the Borrower's corporate powers
and have been duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and binding
agreement of the Borrower and each Note constitutes a valid and binding
obligation of the Borrower, in each case
<PAGE> 107
enforceable in accordance with its terms except as the same may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
by general principles of equity.
We are members of the Bar of the State of New York and the
foregoing opinion is limited to the laws of the State of New York, the federal
laws of the United States of America and the General Corporation Law of the
State of Delaware. In giving the foregoing opinion, we express no opinion as
to the effect (if any) of any law of any jurisdiction (except the State of New
York) in which any Bank is located which limits the rate of interest that such
Bank may charge or collect.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by any other person without our prior written consent.
Very truly yours,
2
<PAGE> 108
EXHIBIT J
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, 19__ among <NAME OF ASSIGNOR>
(the "Assignor"), <NAME OF ASSIGNEE> (the "Assignee"), NACCO MATERIALS HANDLING
GROUP, INC. (the "Borrower") and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as
Agent (the "Agent").
WHEREAS, this Assignment and Assumption Agreement (the
"Agreement") relates to the Credit Agreement dated as of February 28, 1995
among the Borrower, the Assignor and the other Banks party thereto, as Banks,
and the Agent (the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor
has a Commitment to make Loans to the Borrower in an aggregate principal amount
at any time outstanding not to exceed $__________;
WHEREAS, Committed Loans made to the Borrower by the Assignor
under the Credit Agreement in the aggregate principal amount of $__________ are
outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all
of the rights of the Assignor under the Credit Agreement in respect of a
portion of its Commitment thereunder in an amount equal to $__________ (the
"Assigned Amount"), together with a corresponding portion of its outstanding
Committed Loans, and the Assignee proposes to accept assignment of such rights
and assume the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the
mutual agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise
defined herein shall have the respective meanings set forth in the Credit
Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells
to the Assignee all of the rights of the Assignor under the Credit Agreement to
the extent of the Assigned
<PAGE> 109
Amount, and the Assignee hereby accepts such assignment from the Assignor and
assumes all of the obligations of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, including the purchase from the Assignor of the
corresponding portion of the principal amount of the Committed Loans made by the
Assignor outstanding at the date hereof. Upon the execution and delivery hereof
by the Assignor, the Assignee, the Borrower and the Agent and the payment of the
amounts specified in Section 3 required to be paid on the date hereof (i) the
Assignee shall, as of the date hereof, succeed to the rights and be obligated to
perform the obligations of a Bank under the Credit Agreement with a Commitment
in an amount equal to the Assigned Amount, and (ii) the Commitment of the
Assignor shall, as of the date hereof, be reduced by a like amount and the
Assignor released from its obligations under the Credit Agreement to the extent
such obligations have been assumed by the Assignee. The assignment provided for
herein shall be without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and
sale contemplated in Section 2 hereof, the Assignee shall pay to the Assignor
on the date hereof in Federal funds the amount heretofore agreed between them.
(1) It is understood that commitment and/or facility fees accrued to the date
hereof are for the account of the Assignor and such fees accruing from and
including the date hereof are for the account of the Assignee. Each of the
Assignor and the Assignee hereby agrees that if it receives any amount under
the Credit Agreement which is for the account of the other party hereto, it
shall receive the same for the account of such other party to the extent of
such other party's interest therein and shall promptly pay the same to such
other party.
____________________
(1) Amount should combine principal together with accrued interest and
breakage compensation, if any, to be paid by the Assignee, net of any portion
of any upfront fee to be paid by the Assignor to the Assignee. It may be
preferable in an appropriate case to specify these amounts generically or by
formula rather than as a fixed sum.
2
<PAGE> 110
[SECTION 4. Consent of the Borrower and the Agent. This
Agreement is conditioned upon the consent of the Borrower and the Agent
pursuant to Section 9.6(c) of the Credit Agreement. The execution of this
Agreement by the Borrower and the Agent is evidence of this consent. Pursuant
to Section 9.6(c), the Borrower agrees to execute and deliver a Note payable to
the order of the Assignee to evidence the assignment and assumption provided
for herein.]
SECTION 5. Non-Reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition or statements of the
Borrower, or the validity and enforceability of the obligations of the Borrower
in respect of the Credit Agreement or any Note. The Assignee acknowledges that
it has, independently and without reliance on the Assignor, and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and will continue to be
responsible for making its own independent appraisal of the business, affairs
and financial condition of the Borrower.
SECTION 6. Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date
first above written.
<NAME OF ASSIGNOR>
By_________________________
Name:
Title:
<NAME OF ASSIGNEE>
3
<PAGE> 111
By__________________________
Name:
Title:
NACCO MATERIALS HANDLING GROUP, INC.
By__________________________
Name:
Title:
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By__________________________
Name:
Title:
4
<PAGE> 112
EXHIBIT K
FORM OF EXTENSION REQUEST
To Each of the Banks Referred to Below
Ladies and Gentlemen:
We refer to the Credit Agreement dated as of February 28, 1995
(the "Credit Agreement") among NACCO Materials Handling Group, Inc., the Banks
party thereto (the "Banks") and Morgan Guaranty Trust Company of New York, as
Agent. Terms defined in the Credit Agreement are used herein as therein
defined.
We request that each Bank extend its Termination Date from
February __, ____ to February __, ____.
The foregoing extension shall become effective with respect to
each Bank that returns a signed copy of this Extension Request to the Agent if,
and only if, the Agent receives, before June 30, ____, counterparts hereof
signed by Banks having at least 75% of the aggregate amount of the Commitments.
If you agree to the foregoing extension, please sign this
Extension Request in the space provided below and return the signed copy to the
Agent at its address referred to in Section 9.1 of the Credit Agreement.
Very truly yours,
NACCO MATERIALS HANDLING
GROUP, INC.
By____________________________
Name:
Title:
Each of the undersigned Banks
agrees to extend its Termination
Date as specified above.
<PAGE> 113
<NAME OF BANK>
By__________________
Name:
Title:
2
<PAGE> 114
EXHIBIT L
EXISTING LIENS
<TABLE>
<CAPTION>
UCC
Debtor Secured Party Jurisdiction File No. Collateral
------ ------------- ------------ -------- ----------
<S> <C> <C> <C> <C>
Hyster Company Hyster Credit Company Secretary of State, 89324316 Equipment
California
Hyster Company Snap-On Tools Secretary of State, 91188498 Equipment
(assignee) California
NACCO Materials Hyster Credit Company, Secretary of State, 85309734 Equipment/
Handling Group, Inc. a division of AT&T California Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
NACCO Materials Hyster Credit Company, Secretary of State, A187129R Equipment/
Handling Group, Inc. a division of AT&T Alabama Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
Hyster Company LaSalle Computer Secretary of State, 2766317 Equipment
Corporation Illinois
Hyster Company Lasalle Computer Secretary of State, 2766323 Equipment
Corporation Illinois
Hyster Company Lasalle Computer Secretary of State, 2793944 Equipment
Corporation Illinois
Hyster Company Lasalle Computer Secretary of State, 2798315 Equipment
Corporation Illinois
Hyster Company Lasalle Computer Secretary of State, 2842020 Equipment
Corporation Illinois
Hyster Company General Motors Secretary of State, 2870734 Equipment
Corporation Illinois
Hyster Company LaSalle Equipment Secretary of State, 3068444 Equipment
Limited Partnership Illinois
(assignee)
Hyster Company LaSalle Systems Secretary of State, 3096262 Equipment
Leasing, Inc. Illinois
Hyster Company Cincinnati Milacron Secretary of State, 3208525 Equipment
Mktg. Co. Illinois
</TABLE>
<PAGE> 115
<TABLE>
<S> <C> <C> <C> <C>
Hyster Company Norwest Equipment Secretary of State, 3215085 Equipment
Finance, Inc. Illinois
(assignee)
NACCO Materials EMC Corporation Secretary of State, 3330950 Equipment
Handling Group, Inc. Illinois
(as amended)
NACCO Materials Hyster Credit Company, Secretary of State, 2081366 Equipment/
Handling Group, Inc. a division of AT&T Illinois Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
Hyster Company El Camino Resources, Secretary of State, 3235262 Equipment
Ltd. Illinois
NACCO Materials Hyster Credit Company, Vermilion County, 57184 Equipment/
Handling Group, Inc. a division of AT&T Illinois Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
NACCO Materials Hyster Credit Company, Secretary of State, 0173852 Equipment/
Handling Group, Inc. a division of AT&T North Carolina Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
Hyster Company Apollo Oil & Warehouse Madison County, 93-8765 Equipment
Dist. Kentucky
NACCO Materials Hyster Credit Company, Madison County, 85-7955 Equipment/
Handling Group, Inc. a division of AT&T Kentucky Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
NACCO Materials Hyster Credit Company, Secretary of State, K22224 Equipment/
Handling Group, Inc. a division of AT&T Oregon Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
Hyster Company AT&T Secretary of State, P84170 Equipment
Oregon
Hyster Company El Camino Resources, Secretary of State, R94275 Equipment
Ltd. Oregon
Yale Materials Yale Financial Pitt County, 901930 Equipment
Handling Corporation Services, Inc. North Carolina
(Lessee) (Lessor)
</TABLE>
2
<PAGE> 116
<TABLE>
<S> <C> <C> <C> <C>
Yale Materials Heller Financial, Inc. Secretary of State, 1041953 Equipment
Handling Corporation New Jersey
Yale Materials Yale Financial Secretary of State, 1356462 Equipment
Handling Corporation Services, Inc. New Jersey
(Lessee) (Lessor)
NACCO Materials Cincinnati Milacron Secretary of State, 94-16102 Equipment
Handling Group Mktg. Co. Alabama
NACCO Materials Cincinnati Milacron Secretary of State, 94-20248 Equipment
Handling Group Mktg. Co. Alabama
NACCO Materials Cincinnati Milacron Secretary of State, 94-36983 Equipment
Handling Group Mktg. Co. Alabama
NACCO Materials Cincinnati Milacron Secretary of State, 94-40583 Equipment
Handling Group Mktg. Co. Alabama
NACCO Materials Cincinnati Milacron Secretary of State, 94-42078 Equipment
Handling Group Mktg. Co. Alabama
NACCO Materials Sanwa General Secretary of State, 95-01964 Equipment
Handling Group, Inc. Equipment Leasing, a Alabama
division of Sanwa
Business Credit
Corporation
NACCO Materials Cincinnati Milacron Lamar County, Alabama 94-333 Equipment
Handling Group Mktg. Co.
NACCO Materials Cincinnati Milacron Lamar County, Alabama 94-371 Equipment
Handling Group Mktg. Co.
NACCO Materials Cincinnati Milacron Lamar County, Alabama 94-718 Equipment
Handling Group Mktg. Co.
NACCO Materials Cincinnati Milacron Lamar County, Alabama 94-724 Equipment
Handling Group Mktg. Co.
NACCO Materials Sanwa General Lamar County, Alabama 95-23 Equipment
Handling Group, Inc. Equipment Leasing, a
division of Sanwa
Business Credit
Corporation
NACCO Materials Xerox Corporation Secretary of State, 3294821 Equipment
Handling Group Illinois
NACCO Materials Sanwa General Secretary of State, 137551 Equipment
Handling Group, Inc. Equipment Leasing, a Kentucky
division of Sanwa
Business Credit
Corporation
</TABLE>
3
<PAGE> 117
<TABLE>
<S> <C> <C> <C> <C>
NACCO Materials Hyster Credit Company, Secretary of State, 117354 Equipment/
Handling Group, Inc. a division of AT&T Kentucky Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
NACCO Materials Hyster Credit Company, Secretary of State, 895023 Equipment/
Handling Group, Inc. a division of AT&T New Jersey Chattel Paper
(as amended) Commercial Finance
Corporation (as
amended)
NACCO Materials Sanwa General Secretary of State, 1179131 Equipment
Handling Group, Inc. Equipment Leasing, a North Carolina
division of Sanwa
Business Credit
Corporation
NACCO Materials Yale Financial Secretary of State, 1113409 Equipment
Handling Group, Inc. Services, Inc. North Carolina
(Lessee) (Lessor)
NACCO Materials Sanwa General Caldwell County, North 95-8 Equipment
Handling Group, Inc. Equipment Leasing, a Carolina
(Lessee) division of Sanwa
Business Credit
Corporation
NACCO Materials Yale Financial Caldwell County, North 94-1407 Equipment
Handling Group, Inc. Services, Inc. Carolina
(Lessee) (Lessor)
NACCO Materials Yale Financial Pitt County, 941480 Equipment
Handling Group, Inc. Services, Inc. North Carolina
(Lessee) (Lessor)
NACCO Materials Yale Financial Secretary of State, S11207 Equipment
Handling Group, Inc. Services, Inc. Oregon
NACCO Materials Heritage Pullman Bank Secretary of State, S20912 Equipment/
Handling Group, Inc. & Trust (assignee) Oregon Proceeds
NACCO Materials Sanwa General Secretary of State, S37453 Equipment/
Handling Group, Inc. Equipment Leasing, a Oregon Proceeds
division of Sanwa
Business Credit
Corporation
NACCO Materials Sanwa General Secretary of State, S37454 Equipment/
Handling Group, Inc. Equipment Leasing, a Oregon Proceeds
division of Sanwa
Business Credit
Corporation
</TABLE>
4
<PAGE> 118
<TABLE>
<S> <C> <C> <C> <C>
NACCO Materials Textron Financial Secretary of State, S35680 Equipment/
Handling Group, Inc. Corporation, Textron Oregon Proceeds
Capital Corporation
and their affiliates
(assignee)
NACCO Materials Textron Financial Secretary of State, S34586 Equipment/
Handling Group, Inc. Corporation, Textron Oregon Proceeds
Capital Corporation
and their affiliates
(assignee)
NACCO Materials SAFECO Credit Company, Secretary of State, R57714 Equipment
Handling Group, Inc. Inc. Oregon
</TABLE>
5
<PAGE> 119
EXHIBIT M
EXISTING INVESTMENTS
($US in thousands)
February 28, 1995
<TABLE>
<S> <C>
Dealer Capital Enhancement Program $ 2,768
Yale Financial Services $ 2,036
Sumitomo Yale $ 4,228
Dealer Loan $ 61
Australian Dealer $ 986
Other $ 1,921
-------
Total Investments $12,000
=======
</TABLE>
<PAGE> 120
EXHIBIT N
EXISTING ACCOMMODATION OBLIGATIONS
($US in thousands)
February 28, 1995
Guarantees:
<TABLE>
<S> <C>
Wholesale Dealers (HCC) $28,411
Retail Dealers Parts and Units $ 9,680
Wholesale Dealers (YFS) $51,270
Domestic Retail Dealers (YFS) $ 1,616
Parts Repurchase Agreements (YFS) $ 1,070
Foreign Retail Dealers (GECC) $ 1,398
Other $16,555
-------
Total Accomodation Obligations $110,000
========
</TABLE>
<PAGE> 1
Exhibit 10(cvix)
February 28, 1995
Hyster-Yale Materials
Handling, Inc.
2701 N.W. Vaughn, Suite 900 (97210)
P.O. Box 2902
Portland, oregon 97208
NACCO Materials Handling
Group, Inc.
2701 N.W. Vaughn, Suite 900 (97210)
P.O. Box 2902
Portland, Oregon 97208
Gentlemen:
Citicorp North America, Inc., individually and as agent (the
"Agent") for certain banks (the "Lenders"), the Lenders, NACCO Materials
Handling Group, Inc. ("NMHGI"), as successor in interest to each of Hyster
Company ("Hyster") and Yale Materials Handling Corporation ("Yale"), and
Hyster-Yale Materials Handling, Inc. (formerly known as Materials Handling
Holding Company) ("Hyster-Yale", together with NMHGI, the "Borrowers") have
entered into various financing arrangements as set forth in the agreements,
documents and instruments described on Exhibit A attached hereto (all of the
foregoing as the same may have been amended, modified, supplemented or
extended, collectively, the "Credit Documents") pursuant to which the Lenders
have provided financial accommodations to the Borrowers.
Concurrently herewith, the Borrowers have paid or caused to be
paid or satisfied all of their obligations owing to the Lenders and the Agent
under the Credit Documents as of the date hereof.
In consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Releases. (a)(i) The Agent, acting for itself and
on behalf of the Lenders, hereby releases, discharges and acquits the Borrowers
from: (A) the obligations evidenced by the Credit Documents, all of which
Credit Documents are hereby terminated, cancelled and of no further force and
effect and (B) payment and performance of all obligations, liabilities and
indebtedness to the Lenders and the Agent of every kind, nature and
description, direct or indirect, absolute or contingent, joint and/or several,
secured or unsecured, due or not due, primary or secondary, liquidated or
unliquidated, contractual or tortious, however acquired, arising under or in
connection with
<PAGE> 2
the Credit Documents and held by or owed to the Lenders or the Agent and (ii)
the Agent, acting for itself and on behalf of the Lenders, hereby terminates and
releases any and all security interests in, liens upon, rights of setoff against
and pledges of, and hereby reassigns to, the Borrowers all properties and assets
of the Borrowers heretofore granted, pledged, assigned to, or otherwise claimed
by, the Lenders or the Agent pursuant to the Credit Documents, whether personal,
real or mixed, tangible or intangible. Notwithstanding the forgoing, the
agreements set forth in Section 12.9 of the Amended and Restated Credit
Agreement dated as of July 30, 1993, as amended, shall, as provided in such
Section 12.9, survive the termination of the Credit Documents and the repayment
of the obligations thereunder as of the date hereof.
(b) The Borrowers, for themselves and on behalf of their
respective predecessors, successors and assigns, for and in consideration of
the releases above, do hereby release, discharge and acquit each of the Lenders
and the Agent and their affiliates, officers, directors, agents, attorneys and
employees and their respective successors and assigns from all obligations to
the Borrowers (and their successors and assigns) and from any and all claims,
demands, debts, accounts, contracts, liabilities, actions and causes of action,
whether in law or in equity, that the Borrowers at any time had or have, or
that they or their successors or assigns hereafter can or may have against the
Lenders or the Agent and their affiliates, officers, directors, agents,
attorneys or employees and their respective successors and assigns, directly or
indirectly arising out of or in any way related to the Credit Documents or any
transactions thereunder.
2. Delivery of Documents. The Agent agrees to deliver
to the Borrowers (at the Borrowers' expense), upon the effectiveness hereof,
the originals of that certain Master Revolving Note dated January 1, 1994 and
that certain Master Term Note dated January 1, 1994 executed and delivered to
the Lenders or the Agent by the Borrowers duly marked "paid in full" or
"cancelled" as may be appropriate.
3. Further Assurances. The Agent further agrees to
furnish, at the Borrowers' expense, additional releases and/or termination
statements and such other and further documents, instruments and agreements as
may be requested by the Borrowers, in order to effect and evidence more fully
the matters covered hereby.
4. Counterparts. This Agreement may be executed in any
number of counterparts each of which shall be deemed to be an original hereof
and submissible into evidence and all of which together shall be deemed to be a
single instrument.
5. Construction. All references to the "Lenders" or the
"Agent" herein shall include their respective successors and
-2-
<PAGE> 3
assigns. All references to the "Borrowers" herein shall include their
successors and assigns.
Very truly yours,
CITICORP NORTH AMERICA, INC., as
Agent
By: __________________________
Name: Jeffrey D. Klein
Title: Vice President
ACKNOWLEDGED AND AGREED:
NACCO MATERIALS HANDLING GROUP, INC.
By: _________________________________
Name:
Title:
HYSTER-YALE MATERIALS HANDLING, INC.
By: ________________________________
Name:
Title:
-3-
<PAGE> 4
Exhibit A
1. Amended and Restated Credit Agreement dated July 30, 1993,
among the Agent, the Lenders, Hyster-Yale, Yale and Hyster, as
amended.
2. Guaranty, dated May 26, 1989, made by Hyster-Yale to the
Lenders.
3. Security Agreement, dated as of May 26, 1989, between
Hyster-Yale and the Agent.
4. Holdings Pledge Agreement, dated as of May 26, 1989, between
Hyster-Yale and the Agent.
5. Assignment of Rights to Payment, dated as of May 26, 1989,
made by Hyster-Yale to the Agent.
6. Guaranty, dated May 26, 1989, made by Yale to the Lenders.
7. Security Agreement, dated as of May 26, 1989, between Yale and
the Agent.
8. Trademark and License Security Agreement, dated as of May 26,
1989, between Yale and the Agent.
9. Patent and License Security Agreement, dated as of May 26,
1989, between Yale and the Agent.
10. Yale Pledge Agreement, dated as of May 26, 1989, between Yale
and the Agent.
11. Pledge Agreement, dated as of May 26, 1989, between Yale and
the Agent.
12. Deed of Charge, dated May 26, 1989, between Yale and the Agent.
13. Collateral Assignment of Beneficial Interest in a Trust, dated
as of May 26, 1989, made by Yale to the Agent.
14. Guaranty, dated May 26, 1989, made by Hyster to the Lenders.
15. Security Agreement, dated as of May 26, 1989, between Hyster
and the Agent.
16. Trademark and License Security Agreement, dated as of May 26,
1989, between Hyster and the Agent.
-4-
<PAGE> 5
17. Patent and License Security Agreement, dated as of May 26,
1989, between Hyster and the Agent.
18. Hyster Pledge Agreement, dated as of May 26, 1989, between
Hyster and the Agent.
19. Pledge Agreement, dated as of May 26, 1989, between Hyster and
the Agent.
20. Instrument of Pledge, dated as of May 26, 1989, among the
Agent, Hyster and Hyster, B.V.
21. Brazilian Pledge Agreement, dated as of May 26, 1989, among
Hyster, Hyster Overseas Capital Corporation and the Agent.
22. Deed of Change, dated as of May 26, 1989, between Hyster and
the Agent.
23. Aircraft Security Agreement, dated as of May 26, 1989, between
Hyster and the Agent.
24. Guaranty and Security Agreement, dated May 26, 1989, made by
NACCO I Acquisition Corp. ("NACCO I") to the Lenders.
25. NACCO I Pledge Agreement, dated as of May 26, 1989, between
NACCO I and the Agent.
26. Assignment of Rights to Payment, dated as of May 26, 1989,
made by NACCO I to the Agent.
27. North American Consultants, Inc. Pledge Agreement, dated as of
May 26, 1989, between North American Consultants, Inc. and the
Agent.
28. Deed of Trust, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, among Hyster,
Lawyers Title Insurance Company and the Agent, as amended
(California - Commerce City).
29. Deed of Trust, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, among Hyster,
Lawyers Title Insurance Company and the Agent, as amended
(California - Fresno).
30. Deed of Trust, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, among Hyster,
Lawyers Title Insurance Company and the Agent, as amended
(California - Riverside).
-5-
<PAGE> 6
31. Mortgage, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, by Hyster in
favor of the Agent, as amended (Illinois - Danville).
32. Leasehold Mortgage, Security Agreement, Financing Statement
and Assignment of Rents, dated as of May 26, 1989, by Hyster
in favor of the Agent, as amended (Kentucky - Berea).
33. Mortgage, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, by Hyster in
favor of the Agent, as amended (Kentucky - Berea).
34. Landlord's Waiver and Consent Agreement, dated as of May 19,
1989, by and between the City of Berea, Kentucky and Hyster,
as amended.
35. Deed of Trust, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, among Hyster,
Fidelity National Title Company of Oregon and the Agent, as
amended (Oregon - East Portland).
36. Mortgage, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, by Yale in
favor of the Agent, as amended (New Jersey - Flemington).
37. Deed of Trust, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 198, among Yale,
Lawyers Title of North Carolina and the Agent, as amended
(North Carolina - Greenville).
38. Deed of Trust, Security Agreement, Financing Statement and
Assignment of Rents, dated as of May 26, 1989, among Yale,
Lawyers Title of North Carolina and the Agent, as amended
(North Carolina - Lenoir).
39. Pledge Agreement, dated as of July 30, 1993, by and between
Hyster-Yale and the Agent.
40. Security Agreement, dated as of July 30, 1993, by and between
NACCO Materials Handling Holding Company and the Agent.
41. Pledge Agreement, dated August 31, 1993, by Hyster and the
Agent.
-6-
<PAGE> 1
Exhibit 10(cx)
AMENDMENT NO. 2A
TO THE
NACCO MATERIALS HANDLING GROUP, INC.
CASH BALANCE PLAN
NACCO Materials Handling Group, Inc. hereby adopts this
Amendment No. 2A 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 as of
the dates specified 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 June 1, 1995, the second and third paragraphs of
Exhibit A to the Plan are hereby amended in their entirety to read as follows:
"A different interest rate and mortality rate shall be used for
determining the conversion of a Participant's Cash Balance Account
into a life annuity or for converting an Indexed Prior Plan Benefit
into a lump sum present value. The interest rate to be used for this
purpose shall be the annual rate of interest on 30-year Treasury
securities for the month before the date of distribution (which
interest rate is the 'applicable interest rate' under Section
417(e)(3)(A)(ii)(II) of the Code as amended by the Retirement
Protection Act of 1994). To the extent permitted by applicable
Treasury Regulations, January 1 of the Plan Year in which the
distribution occurs shall be treated as the date of distribution. The
mortality table for this purpose shall be the 1983 Group Annuity
Mortality Table, assuming a fixed blend of 50% of the male mortality
rates and 50% of the female mortality rates (or such other mortality
table which is prescribed by the Secretary of the Treasury for this
purpose under Section 417(e)(3)(A)(ii)(I) of the Code).
Conversion to a 5-year, 10-year or 15-year certain annuity shall be
accomplished by first converting all Plan benefits to a lump sum and
then converting the lump sum to the certain annuity based on the
interest rate and mortality rate described in the preceding
paragraph."
Section 2
Effective April 1, 1995, the first sentence of Section 2.01(b)
of the Plan is hereby amended by deleting the phrase "or who is a temporary or
seasonal Employee" therefrom.
<PAGE> 2
Section 3
Effective as of December 31, 1994, a new Section 5.02A is
hereby added to the Plan, immediately following Section 5.02, to read as
follows:
"5.02A Additional Cash Balance Credit for the 1994 Plan Year.
For the Plan Year commencing on January 1, 1994, the following Cash Balance
Credit shall be added to the Cash Balance Account of each Participant who
completed an Hour of Service during the 1994 Plan Year. The additional Cash
Balance Credit shall be in addition to the Cash Balance Credit under Section
5.02 hereof and shall be equal to the sum of (a) plus (b), where (a) is the
Participant's Compensation for the 1994 Plan Year multiplied by a percentage
factor and (b) is the Participant's Compensation for the 1994 Plan Year which
exceeds the Social Security Wage Base for the 1994 Plan Year multiplied by a
percentage factor, both of which are determined in accordance with the
following schedule:
<TABLE>
<CAPTION>
Percentage of
Percentage Compensation Exceeding
Age Compensation Social Security Wage Base
--- ------------ -------------------------
<S> <C> <C>
0-34 .63% .63%
35-39 .72% .72%
40-44 .88% .88%
45-49 1.10% 1.10%
50-54 1.35% .97%
55-59 1.70% .71%
60+ 1.98% .45%
</TABLE>
For purposes of determining the age to be used in the above calculation, age
shall mean the Participant's age in full years on his birthday in the 1994 Plan
Year."
Section 4
Effective as of January 1, 1993, the last two sentences of
Section 7.03(d) of the Plan are hereby deleted in their entirety.
Section 5
Effective as of January 1, 1993, a new Section 7.03(e) is
hereby added to the Plan, immediately following Section 7.03(d), to read as
follows:
"(e) (1) The provisions of this Section shall be effective as
of January 1, 1993.
(2) The Administrative Committee shall provide a Participant
or Beneficiary with an application form (which shall contain a general
description of the forms of benefit available under the Plan) and such
other information required to be provided under Section 402(f) of the
Code no less than 30 days and no more than 90 days before a
distribution is to be made.
<PAGE> 3
(3) Notwithstanding any provision of the Plan to the
contrary, if a Participant or Spouse is eligible to receive a
distribution from the Plan that constitutes an "eligible rollover
distribution" (as defined in Paragraph (6) of this Subsection) and the
Participant or Spouse elects to have all or a portion of such
distribution paid directly to an "eligible retirement plan" (as
defined in Paragraph (5) of this Subsection) and specifies the
eligible retirement plan to which the distribution is to be paid, such
distribution (or portion thereof) shall be made in the form of a
direct rollover to the eligible retirement plan so specified. A
direct rollover is a payment made by the Plan to the eligible
retirement plan so specified for the benefit of the Participant or
Spouse. Unless otherwise specifically provided herein, for purposes
of this Subsection, the term "Spouse" shall include a former Spouse
who is an alternate payee under the terms of a qualified domestic
relations order.
(4) The Committee shall prescribe reasonable procedures for
the elections to be made pursuant to this Section.
(5) For purposes of this Subsection, the term "eligible
retirement plan" means an individual retirement account or annuity
under Code Section 408, a defined contribution plan that satisfies the
requirements of Code Section 401(a) and accepts rollovers, an annuity
plan under Code Section 403(a) or any other type of plan that is
included within the definition of "eligible retirement plan" under
Section 401(a)(31)(D) of the Code; provided that with respect to a
spouse (but not a former spouse who is an alternate payee) who
receives a distribution after a Participant's death, an "eligible
retirement plan" shall mean only an individual retirement account or
annuity under Code Section 408.
(6) For purposes of this Subsection, the term "eligible
rollover distribution" shall mean any distribution of all or any
portion of the balance to the credit of the distributee from an
employees' trust described in Code Section 401(a) which is exempt from
tax under Code Section 501(a), except (i) distributions which are not
expected to exceed $200 in any given Plan Year, (ii) any distribution
that is one of a series of substantially equal periodic payments (not
less frequently than annually) over the life (or life expectancy) of
the distributee or the joint lives (or life expectancies) of the
distributee and a designated beneficiary or for a period of 10 or more
years, (iii) any distribution to the extent required under Code
Section 401(a)(9), (iv) the portion of any distribution that is not
includible in gross income, and (v) such other amounts specified in
Treasury regulations and rulings, notices or announcements issued
under Section 402(c) of the Code.
(7) The provisions of this Subsection are intended to comply
with the provisions of Section 401(a)(31) of the Code and shall be
interpreted in accordance with such section and Treasury regulations
and rulings thereunder."
Section 6
<PAGE> 4
Effective June 1, 1995, Section 12.10(c) of the Plan is hereby
amended in its entirety to read as follows:
"(c) Notwithstanding the foregoing provisions of this
Section:
(1) If the benefit under the Plan is payable in any form
other than the life annuity form, or if the Employees
contribute to the Plan or make rollover contributions or plan
to plan transfers, for purposes of determining whether the
limitations described in Subsection (b) of this Section have
been satisfied, such benefit shall be adjusted, in accordance
with rules determined by the Commissioner of the Internal
Revenue under Treasury Regulation Section 1.415-3(c), so that
such benefit is equivalent to an annual benefit. For purposes
of this part (1), any ancillary benefit which is not directly
related to retirement income benefits shall not be taken into
account, and that portion of any joint and survivor annuity
which constitutes a qualified joint and survivor annuity (as
defined in Section 417(b) of the Code) shall not be taken into
account.
(2) If the benefit under the Plan begins before the Social
Security Retirement Age, for purposes of determining whether
the limitation set forth in Paragraph (1) of Subsection (b) of
this Section has been satisfied, such benefit shall be reduced
in accordance with the following rules:
(X) if an Employee's Social Security Retirement Age is
age 65, the dollar limitation for benefits commencing
on or after age 62 is reduced by 5/9 of 1% for each
month by which benefits commence before the month in
which the Employee attains age 65;
(Y) if an Employee's Social Security Retirement Age is
greater than age 65, the dollar limitation for
benefits commencing at or after age 62 is reduced by
5/9 of 1% for each of the first 36 months and 5/12 of
1% for each of the additional months (up to 24
months) by which benefits commence before the month
of the Employee's Social Security Retirement Age;
(Z) the dollar limitation for benefits commencing prior
to age 62 is the Actuarial Equivalent of the
limitation for benefits commencing at age 62.
(3) If the benefit begins after the Social Security
Retirement Age, for purposes of determining whether the
limitation set forth in Paragraph (1) of Subsection (b) of
this Section has been satisfied, such limitation shall be
increased, in accordance with regulations prescribed by the
Secretary of the Treasury pursuant to Code Section
415(b)(2)(E), so that such limitation (as so increased) equals
an annual benefit (beginning when such benefit begins under
the Plan) which is Actuarial Equivalent to an annual benefit
equal to the limitation set forth in such Paragraph (1)
beginning at the Social Security Retirement Age.
<PAGE> 5
(4) The interest rate assumption used to determine Actuarial
Equivalence for purposes of (1) or (2) above shall be the
greater of 7.5% or the interest rate specified in the second
paragraph of Exhibit A. Adjustments under (1), (2) and (3)
above shall be made through the use of the mortality table
specified in the second paragraph of Exhibit A."
EXECUTED this 15 day of March, 1995.
--
NACCO MATERIALS HANDLING GROUP, INC.
By: /s/ Charles Bittenbender
---------------------------
Title: Assistant Secretary
<PAGE> 1
Exhibit 21(i)
SUBSIDIARIES OF HYSTER-YALE MATERIALS HANDLING, INC.
As of the date of the Annual Report on Form 10-K to which this is an
Exhibit, the subsidiaries of Hyster-Yale Materials Handling were as follows:
<TABLE>
<CAPTION>
Name Incorporation
---- -------------
<S> <C>
NACCO Materials Handling Group, Pty. Ltd. Australia
NACCO Materials Handling B.V. Netherlands
Hyster Europe Limited United Kingdom
NACCO Materials Handling Group, Inc. Delaware
NACCO Materials Handling Group Ltd. United Kingdom
NACCO Materials Handling (Scotland) Ltd. Scotland
NACCO Materials Handling (N.I.) Ltd. Northern Ireland
Yale Europe Materials Handling Ltd. United Kingdom
</TABLE>
_______________________________________________________________________
Certain subsidiaries of the Company which, considered in the
aggregate, would not constitute a "significant subsidiary" within the meaning
of Rule 1-02 contained in Regulation S-X have been omitted.
<PAGE> 1
Exhibit 24(i)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Owsley Brown
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(ii)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ John J. Dwyer
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(iii)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Robert M. Gates
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(iv)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ E. B. Jones
------------------------------------
Date: 2/16/95
<PAGE> 1
Exhibit 24(v)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Dennis W. LaBarre
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(vi)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Yoshinori Ohno
------------------------------------
Date: 2/17/95
<PAGE> 1
Exhibit 24(vii)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Alfred M. Rankin, Jr.
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(viii)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Clairborne R. Rankin
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(ix)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ John C. Sawhill
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(x)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Britton F. Taplin
------------------------------------
Date: 2/14/95
<PAGE> 1
Exhibit 24(xi)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ David F. Taplin
------------------------------------
Date: 2/08/95
<PAGE> 1
Exhibit 24(xii)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Frank E. Taplin, Jr.
------------------------------------
Date: 3/10/95
<PAGE> 1
Exhibit 24(xiii)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Director of
Hyster-Yale Materials Handling, Inc. hereby constitutes and appoints Bergen I.
Bull, G. Michael Decker and Charles A. Bittenbender, and each of them, as the
true and lawful attorney or attorneys-in-fact, with full power of substitution
and revocation, for the undersigned and in the name, place and stead of the
undersigned, to sign on behalf of the undersigned as Director of Hyster-Yale
Materials Handling, Inc., a Delaware corporation, an Annual Report pursuant to
Section 15(d) of the Securities Exchange Act of 1934, as amended, on Form 10-K
for the fiscal year ended December 31, 1993, and to sign any and all amendments
to such Annual Report, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting to said attorney or attorneys-in-fact, and each of them,
full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney or attorneys-in-fact or any of
them or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
/s/ Richard B. Tullis
------------------------------------
Date: 2/08/95
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000850422
<NAME> HYSTER-YALE MATERIALS HANDLING, INC.
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<EXCHANGE-RATE> 1
<CASH> 10,763
<SECURITIES> 0
<RECEIVABLES> 144,497
<ALLOWANCES> 3,265
<INVENTORY> 208,828
<CURRENT-ASSETS> 383,373
<PP&E> 214,446
<DEPRECIATION> 88,830
<TOTAL-ASSETS> 906,249
<CURRENT-LIABILITIES> 321,869
<BONDS> 78,524
<COMMON> 6
0
0
<OTHER-SE> 305,920
<TOTAL-LIABILITY-AND-EQUITY> 906,249
<SALES> 1,178,882
<TOTAL-REVENUES> 1,178,882
<CGS> 947,375
<TOTAL-COSTS> 1,113,065
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 33,744
<INCOME-PRETAX> 35,816
<INCOME-TAX> 17,077
<INCOME-CONTINUING> 18,739
<DISCONTINUED> 0
<EXTRAORDINARY> (3,219)
<CHANGES> 0
<NET-INCOME> 15,520
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
