HYSTER-YALE, INC. 10-K

Item 9A . CONTROLS AND PROCEDURES Evaluation of disclosure controls and procedures: An evaluation was carried out under the supervision and with the participation of the Company's management, including the principal executive officer and the principal financial officer, of the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, these officers have concluded that the Company's disclosure controls and procedures were effective. 28 Table of Contents Management's report on internal control over financial reporting: Management is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision and with the participation of management, including the principal executive officer and principal financial officer, the Company conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework). Based on this evaluation under the framework in Internal Control — Integrated Framework, management concluded that the Company's internal control over financial reporting was effective as of December 31, 2020. The Company's effectiveness of internal control over financial reporting has been audited by Ernst & Young, LLP, an independent registered public accounting firm, as stated in its report, which is included in Item 15 of this Annual Report on Form 10-K and is incorporated herein by reference. Changes in internal control: During the fourth quarter of 2020, there have been no changes in the Company's internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. Item 9B . OTHER INFORMATION None. PART III Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Information required by this Item 10 of Part III will be included in the 2021 Proxy Statement, which information is incorporated herein by reference. Information regarding the executive officers of the Company is included in this Annual Report on Form 10-K as Item 4A of Part I as permitted by the Instruction to Item 401 of Regulation S-K. The Company has adopted a code of ethics applicable to all Company personnel, including the principal executive officer, principal financial officer, principal accounting officer and controller, or other persons performing similar functions. The code of ethics, entitled the “Code of Corporate Conduct,” is posted on the Company's website at www.hyster-yale.com under “Corporate Governance.” Amendments and waivers of the Company's Code of Corporate Conduct for directors or executive officers of the Company, if any, will be disclosed on the Company's website or on a current report on Form 8-K. Item 11. EXECUTIVE COMPENSATION Information required by this Item 11 of Part III will be included in the 2021 Proxy Statement, which information is incorporated herein by reference. 29 Table of Contents Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Information required by this Item 12 of Part III will be included in the 2021 Proxy Statement, which information is incorporated herein by reference. Equity Compensation Plan Information The following table sets forth information as of December 31, 2020 with respect to our compensation plans (including individual compensation arrangements) under which equity securities are authorized for issuance, aggregated as follows: Plan Category Number of Securities to Be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column(a)) Class A Shares: (a) (b) (c) Equity compensation plans approved by security holders — N/A 1,069,593 Equity compensation plans not approved by security holders — N/A — Total — N/A 1,069,593 Class B Shares: Equity compensation plans approved by security holders — N/A — Equity compensation plans not approved by security holders — N/A — Total — N/A — Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Information required by this Item 13 of Part III will be included in the 2021 Proxy Statement, which information is incorporated herein by reference. Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Information required by this Item 14 of Part III will be included in the 2021 Proxy Statement, which information is incorporated herein by reference. PART IV Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) (1) The response to Item 15(a)(1) is set forth beginning at page F-1 of this Annual Report on Form 10-K. (a) (2) The response to Item 15(a)(2) is set forth beginning at page F-41 of this Annual Report on Form 10-K. (a) (3) Listing of Exhibits — See the exhibit index beginning at page 31 of this Annual Report on Form 10-K. (b) The response to Item 15(b) is set forth beginning at page 31 of this Annual Report on Form 10-K. 30 Table of Contents EXHIBIT INDEX (3) Articles of Incorporation and By-laws. 3.1(i) Second Amended and Restated Certificate of Incorporation of Hyster-Yale Materials Handling, Inc. is incorporated by reference to Exhibit 3.1 to Hyster-Yale Materials Handling, Inc.'s Amendment No. 5 to the Registration Statement on Form S-1, dated September 26, 2012, Commission File No. 333-182388. 3.1(ii) Amended and Restated By-laws of Hyster-Yale Materials Handling, Inc. are incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K, dated February 17, 2015, Commission File No. 000-54799. (4) Instruments defining the rights of security holders, including indentures. 4.1 Specimen of Hyster-Yale Materials Handling, Inc. Class A Common Stock certificate is incorporated by reference to Exhibit 4.1 to Hyster-Yale Materials Handling, Inc.'s Registration Statement on Form S-1, dated June 28, 2012, Commission File No. 333-182388. 4.2 Specimen of Hyster-Yale Materials Handling, Inc. Class B Common Stock certificate is incorporated by reference to Exhibit 4.2 to Hyster-Yale Materials Handling, Inc.'s Registration Statement on Form S-1, dated June 28, 2012, Commission File No. 333-182388. 4.3 Description of Securities is incorporated by reference to Exhibit 4.3 to the Company's Annual Report on Form 10-K, filed by the Company on February 25, 2020, Commission File Number 000-54799. (10) Material Contracts. 10.1 Tax Allocation Agreement, dated September 28, 2012, by and between NACCO Industries, Inc. and Hyster-Yale Materials Handling, Inc. is incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K, dated October 4, 2012, Commission File Number 1-35646. 10.2 Stockholders' Agreement, dated as of September 28, 2012, by and among the Participating Stockholders (as defined therein), Hyster-Yale Materials Handling, Inc. and the Depository (as defined therein) is incorporated by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K, dated October 4, 2012, Commission File No. 1-35646. 10.3 First Amendment to Stockholders' Agreement, dated as of December 31, 2012, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 10.5 to the Company's Annual Report on Form 10-K, filed by the Company on February 19, 2013, Commission File Number 000-54799. 10.4 Second Amendment to Stockholders' Agreement, dated as of January 18, 2013, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 10.6 to the Company's Annual Report on Form 10-K, filed by the Company on February 19, 2013, Commission File Number 000-54799. 10.5 Third Amendment to Stockholders' Agreement, dated as of March 27, 2015, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q, filed by the Company on April 29, 2015, Commission File Number 000-54799. 10.6 Fourth Amendment to Stockholders' Agreement, dated as of December 29, 2015, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 10 filed with Amendment No. 4 to the Statement on Schedule 13D, filed by the Reporting Persons named therein on February 16, 2016, Commission File Number 005-87003. 10.7 Fifth Amendment to Stockholders' Agreement, dated as of December 2, 2016, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit No. 11 filed with Amendment No. 5 to the Statement on Schedule 13D, filed by the reporting persons named therein on February 14, 2017, Commission File Number 005-38001. 10.8 Sixth Amendment to Stockholders' Agreement, dated as of December 22, 2016, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit No. 12 filed with Amendment No. 5 to the Statement on Schedule 13D, filed by the reporting persons named therein on February 14, 2017, Commission File Number 005-38001. 10.9 Seventh Amendment to Stockholders' Agreement, dated as of February 6, 2017, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q, filed by the Company on May 2, 2017, Commission File Number 000-54799. 10.10 Eighth Amendment to Stockholders' Agreement, dated as of October 30, 2018, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 10.10 to the Company's Annual Report on Form 10-K, filed by the Company on February 26, 2019, Commission File Number 000-54799. 10.11 Ninth Amendment to Stockholders' Agreement, dated as of December 5, 2019, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholder identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 28 filed with Amendment No. 8 to the Statement on Schedule 13D, filed by the reporting persons named therein on February 13, 2020, Commission File Number 005-38001. 31 Table of Contents 10.12 Tenth Amendment to Stockholders' Agreement, dated as of December 31, 2020, by and among the Depository, Hyster-Yale Materials Handling, Inc., the new Participating Stockholders identified on the signature pages thereto and the Participating Stockholders under the Stockholders' Agreement, dated as of September 28, 2012, as amended, by and among the Depository, Hyster-Yale Materials Handling, Inc. and the Participating Stockholders is incorporated by reference to Exhibit 30 filed with Amendment No. 9 to the Statement on Schedule 13D, filed by the reporting persons named therein on February 12, 2021, Commission File Number 005-38001. 10.13* The Hyster-Yale Group, Inc. Executive Excess Retirement Plan (Effective as of January 1, 2016) is incorporated by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K, filed by the Company on February 28, 2017, Commission File Number 000-54799. 10.14* Amendment No. 1 to the Hyster-Yale Group, Inc. Executive Excess Retirement Plan (As Amended and Restated as of January 1, 2016) is incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, dated April 30, 2020, Commission File Number 000-54799. 10.15* Hyster-Yale Hyster-Yale Materials Handling, Inc. 2020 Long-Term Equity Incentive Plan, is incorporated by reference to Appendix A to the Company's Definitive Proxy Statement on Form DEF 14A, filed by the Company on March 31, 2020, Commission File Number 000-54799. Handling, Inc. 2020 Long-Term Equity Incentive Plan, is incorporated by reference to Appendix A to the Company's Definite Proxy Statement on Form DEF 14A, filed by the Company on March 31, 2020, Commission File Number 000-54799. 10.16* Hyster-Yale Materials Handling, Inc. Supplemental Long-Term Equity Incentive Plan (Effective as of the Spin-Off Date) is incorporated by reference to Exhibit 10.67 to Hyster-Yale Materials Handling, Inc.'s Amendment No. 3 to the Registration Statement on Form S-1, dated September 13, 2012, Commission File Number 333-182388. 10.17* Form Award Agreement for the Hyster-Yale Materials Handling, Inc. Supplemental Long-Term Equity Incentive Plan (Effective as of the Spin-Off Date) is incorporated by reference to Exhibit 10.68 to Hyster-Yale Materials Handling, Inc.'s Amendment No. 3 to the Registration Statement on Form S-1, dated September 13, 2012, Commission File Number 333-182388. 10.18* Hyster-Yale Materials Handling, Inc. Non-Employee Directors' Equity Compensation Plan (Amended and Restated Effective May 17, 2019) is incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K, filed by the Company on February 25, 2020, Commission File Number 000-54799. 10.19* Hyster-Yale Materials Handling, Inc. and Subsidiaries Director Fee Policy (Amended Effective as of May 1, 2020) is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q, filed by the Company on August 4, 2020, Commission File Number 000-54799. 10.20* Hyster-Yale Materials Handling, Inc. and Subsidiaries Director Fee Policy (Amended Effective as of January 1, 2020) is incorporated by reference to Exhibit 10.18 to the Company's Annual Report on Form 10-K, filed by the Company on February 25, 2020, Commission File Number 000-54799. 10.21* The Hyster-Yale Group, Inc. Long-Term Incentive Compensation Plan (Amended and Restated Effective as of January 1, 2016) is incorporated by reference to Exhibit 10.24 to the Company's Annual Report on Form 10-K, filed by the Company on February 28, 2017, Commission File Number 000-54799. 10.22* The Hyster-Yale Group Inc. Annual Incentive Compensation Plan (Amended and Restated Effective as of January 1, 2016) is incorporated by reference to Exhibit 10.25 to the Company's Annual Report on Form 10-K, filed by the Company on February 28, 2017, Commission File Number 000-54799. 10.23* Hyster-Yale Group, Inc. Excess Retirement Plan (Amended and Restated Effective January 1, 2016) is incorporated by reference to Exhibit 10.35 to the Company's Annual Report on Form 10-K, filed by the Company on February 17, 2016, Commission File Number 000-54799. 10.24* Amendment No. 1 to the Hyster-Yale Group, Inc. Excess Retirement Plan (As Amended and Restated as of January 1, 2016) is incorporated by reference to Exhibit 10.24 to the Company's Annual Report on Form 10-K, filed by the Company on February 26, 2019, Commission File Number 000-54799. 10.25 Equity joint venture contract, dated November 27, 1997, between Shanghai Perfect Jinqiao United Development Company Ltd., People’s Republic of China, NACCO Materials Handling Group, Inc., USA, and Sumitomo-Yale Company Ltd., Japan is incorporated by reference to Exhibit 10.3 to NMHG Holding Co.’s Registration Statement on Form S-4, dated May 28, 2002, Commission File Number 333-89248. 10.26 Third Amended and Restated Joint Venture and Shareholders Agreement between Wells Fargo Financial Leasing, Inc. and Hyster-Yale Group, Inc., dated September 17, 2018 is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2018, Commission File Number 000-54799. 10.27 A$ Facility Agreement, dated November 22, 2000, between GE Capital Australia and National Fleet Network Pty Limited is incorporated by reference to Exhibit 10.12 to NMHG Holding Co.’s Registration Statement on Form S-4, dated May 28, 2002, Commission File Number 333-89248. 10.28 Second Amended and Restated Recourse and Indemnity Agreement, dated September 17, 2018, by and between Wells Fargo Financial Leasing, Inc., HYG Financial Services, Inc, and Hyster-Yale Group, Inc. is incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2018, Commission File Number 000-54799. 10.29 First Amended and Restated Guarantee Agreement, dated September 17, 2018, by Hyster-Yale Materials Handling, Inc. in favor of Wells Fargo Financial Leasing, Inc. is incorporated by reference to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2018, Commission File Number 000-54799. 10.30 First Amended and Restated Guarantee Agreement, dated September 17, 2018, by Hyster-Yale Group, Inc. in favor of Wells Fargo Financial Leasing, Inc. is incorporated by reference to Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2018, Commission File Number 000-54799. 10.31 Loan, Security and Guaranty Agreement dated as of April 28, 2016 among Hyster-Yale Materials Handling, Inc. and Hyster-Yale Group, Inc., as U.S. Borrowers, Hyster-Yale Nederland B.V., Hyster-Yale International B.V., Hyster-Yale Holding B.V. and Hyster-Yale Capital Holding B.V., as Dutch Borrowers, Hyster-Yale UK Limited and Hyster-Yale Capital UK Limited, as UK Borrowers, any other Borrowers party thereto from time to time and certain Persons party thereto from time to time as Guarantors, certain financial institutions, as Lenders, Bank of America, N.A., as Administrative Agent and Security Trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated and CitiGroup Global Markets Inc., as Joint Lead Arrangers and Joint Book Managers, and CitiBank, N.A., as Syndication Agent is incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, dated April 28, 2016, Commission File Number 000-54799. 10.32 First Amendment to Amended and Restated Loan, Security and Guaranty Agreement dated as of May 30, 2017 among Hyster-Yale Materials Handling, Inc. and Hyster-Yale Group, Inc., as U.S. Borrowers, Hyster-Yale Nederland B.V., Hyster-Yale International B.V., Hyster-Yale Holding B.V. and Bolzoni Capital Holding B.V., as Dutch Borrowers, Hyster-Yale UK Limited and Bolzoni Capital UK Limited, as UK Borrowers, any other Borrowers party thereto from time to time and certain Persons party thereto from time to time as Guarantors, certain financial institutions, as Lenders, Bank of America, N.A., as Administrative Agent and Security Trustee is incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, Commission File Number 000-54799. 32 Table of Contents 10.33 Second Amendment to Amended and Restated Loan, Security and Guaranty Agreement, dated as of March 14, 2018, among Hyster-Yale Materials Handling, Inc. and Hyster-Yale Group, Inc., as U.S. Borrowers, Hyster-Yale Nederland B.V., Hyster-Yale International B.V., Hyster-Yale Holding B.V. and Bolzoni Capital Holding B.V., as Dutch Borrowers, Hyster-Yale UK Limited and Bolzoni Capital UK Limited, as UK Borrowers, any other Borrowers party thereto from time to time and certain Persons party thereto from time to time as Guarantors, certain financial institutions, as Lenders, Bank of America, N.A., as Administrative Agent and Security Trustee is incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, Commission File Number 000-54799. 10.34 Third Amendment to Amended and Restated Loan, Security and Guaranty Agreement, dated as of April 3, 2019, among Hyster-Yale Materials Handling, Inc., Hyster-Yale Group, Inc., and Bolzoni Auramo, Inc. as U.S. Borrowers, Hyster-Yale Nederland B.V., Hyster-Yale International B.V., Hyster-Yale Holding B.V. and Bolzoni Capital Holding B.V., as Dutch Borrowers, Hyster-Yale UK Limited and Bolzoni Capital UK Limited, as UK Borrowers, any other Borrowers party thereto from time to time and certain Persons party thereto from time to time as Guarantors, certain financial institutions, as Lenders, Bank of America, N.A., as Administrative Agent and Security Trustee is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, Commission File Number 000-54799. 10.35 Fourth Amendment to Amended and Restated Loan, Security and Guaranty Agreement, dated as of June 16, 2020, among Hyster-Yale Materials Handling, Inc., Hyster-Yale Group, Inc., and Bolzoni Auramo, Inc. as U.S. Borrowers, Hyster-Yale Nederland B.V., Hyster-Yale International B.V., Hyster-Yale Holding B.V. and Bolzoni Capital Holding B.V., as Dutch Borrowers, Hyster-Yale UK Limited and Bolzoni Capital UK Limited, as UK Borrowers, any other Borrowers party thereto from time to time and certain Persons party thereto from time to time as Guarantors, certain financial institutions, as Lenders, Bank of America, N.A., as Administrative Agent and Security Trustee is incorporated by reference to Exhibit 10. 2 to the Company's Quarterly Report on Form 10-Q, filed by the Company on August 4, 2020, Commission File Number 000-54799. 10.36 Term Loan Credit Agreement dated as of May 30, 2017 among Hyster-Yale Group, Inc. as the Borrower, Hyster-Yale Materials Handling, Inc., Bank of America, N.A., as Administrative Agent is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, Commission File Number 000-54799. 10.37 First Amendment to Term Loan Credit Agreement, dated as of March 14, 2018, by and among Hyster-Yale Group, Inc., as the Borrower, Hyster-Yale Materials Handling, Inc. and Bank of America, N.A., as Administrative Agent is incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, Commission File Number 000-54799. 10.38 Equity Transfer Agreement, dated December 6, 2017, by and between KNSN Pipe & Pile Company Limited and Hyster-Yale Acquisition Holding LTD Regarding Zhejiang Maximal Forklift Co., LTD. is incorporated by reference to Exhibit 10.57 to the Company's Annual Report on Form 10-K, filed by the Company on February 27, 2018, Commission File Number 000-54799. (21) Subsidiaries. 21.1 A list of the subsidiaries of the Company is attached hereto. (23) Consents of experts and counsel. 23.1 Consent of Ernst & Young LLP. (24) Powers of Attorney. 24.1 A copy of a power of attorney for James B. Bemowski is attached hereto. 24.2 A copy of a power of attorney for John C. Butler Jr. is attached hereto. 24.3 A copy of a power of attorney for Carolyn Corvi is attached hereto. 24.4 A copy of a power of attorney for Edward T. Eliopoulos is attached hereto. 24.5 A copy of a power of attorney for John P. Jumper is attached hereto. 24.6 A copy of a power of attorney for Dennis W. LaBarre is attached hereto. 24.7 A copy of a power of attorney for H. Vincent Poor is attached hereto. 24.8 A copy of a power of attorney for Claiborne R. Rankin is attached hereto. 24.9 A copy of a power of attorney for Britton T. Taplin is attached hereto. 24.10 A copy of a power of attorney for David B. H. Williams is attached hereto. 24.11 A copy of a power of attorney for Eugene Wong is attached hereto. (31) Rule 13a-14(a)/15d-14(a) Certifications. 31(i)(1) Certification of Alfred M. Rankin, Jr. pursuant to Rule 13a-14(a)/15d-14(a) of the Exchange Act is attached hereto. 31(i)(2) Certification of Kenneth C. Schilling pursuant to Rule 13a-14(a)/15d-14(a) of the Exchange Act is attached hereto. (32) Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed and dated by Alfred M. Rankin, Jr. and Kenneth C. Schilling 101.INS Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema Document. 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). * Management contract or compensation plan or arrangement required to be filed as an exhibit pursuant to Item 15(b) of this Annual Report on Form 10-K. Item 16. FORM 10-K SUMMARY None 33 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Hyster-Yale Materials Handling, Inc. By: /s/ Kenneth C. Schilling Kenneth C. Schilling Senior Vice President and Chief Financial Officer (principal financial and accounting officer) February 24, 2021 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. /s/ Alfred M. Rankin, Jr. Chairman and Chief Executive Officer (principal executive officer), Director February 24, 2021 Alfred M. Rankin, Jr. /s/ Kenneth C. Schilling Senior Vice President and Chief Financial Officer (principal financial and accounting officer) February 24, 2021 Kenneth C. Schilling * James B. Bemowski Director February 24, 2021 James B. Bemowski * J.C. Butler, Jr. Director February 24, 2021 J.C. Butler, Jr. * Carolyn Corvi Director February 24, 2021 Carolyn Corvi * Edward T. Eliopoulos Director February 24, 2021 Edward T. Eliopoulos * John P. Jumper Director February 24, 2021 John P. Jumper * Dennis W. LaBarre Director February 24, 2021 Dennis W. LaBarre * H. Vincent Poor Director February 24, 2021 H. Vincent Poor * Claiborne R. Rankin Director February 24, 2021 Claiborne R. Rankin * Britton T. Taplin Director February 24, 2021 Britton T. Taplin * David B. H. Williams Director February 24, 2021 David B. H. Williams * Eugene Wong Director February 24, 2021 Eugene Wong * Kenneth C. Schilling, 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 directors of the Company pursuant to a Power of Attorney executed by such persons and filed with the Securities and Exchange Commission. /s/ Kenneth C. Schilling February 24, 2021 Kenneth C. Schilling, Attorney-in-Fact 34 Table of Contents ANNUAL REPORT ON FORM 10-K ITEM 8, ITEM 15(a)(1) AND (2) FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE FINANCIAL STATEMENTS FINANCIAL STATEMENT SCHEDULE YEAR ENDED DECEMBER 31, 2020 HYSTER-YALE MATERIALS HANDLING, INC. CLEVELAND, OHIO 35 Table of Contents FORM 10-K ITEM 15(a)(1) AND (2) HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE The following consolidated financial statements of Hyster-Yale Materials Handling, Inc. and Subsidiaries are incorporated by reference in Item 8: Report of Ernst & Young LLP, Independent Registered Public Accounting Firm — For each of the three years in the period ended December 31, 2020 F- 2 Report of Ernst & Young LLP, Independent Registered Public Accounting Firm on Internal Control over Financial Reporting — as of December 31, 2020 F- 4 Consolidated Statements of Operations F- 5 Consolidated Statements of Comprehensive Income (Loss) F- 6 Consolidated Balance Sheets F- 7 Consolidated Statements of Cash Flows F- 8 Consolidated Statements of Equity F- 9 Notes to Consolidated Financial Statements. F- 10 The following consolidated financial statement schedule of Hyster-Yale Materials Handling, Inc. and Subsidiaries are included in Item 15(a): Schedule II — Valuation and Qualifying Accounts F- 41 All other schedules for which provision is made in the applicable accounting regulation of the SEC are not required under the related instructions or are inapplicable, and therefore have been omitted. F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Hyster-Yale Materials Handling, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Hyster-Yale Materials Handling, Inc. and Subsidiaries (“the Company”) as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive income (loss), cash flows and equity for each of the three years in the period ended December 31, 2020, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 24, 2021 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates. Valuation of Goodwill Description of the Matter At December 31, 2020, the Company’s goodwill balance was $114.7 million. As discussed in Note 13, Goodwill and Intangible Assets, to the consolidated financial statements, the Company evaluates the carrying amount of goodwill for impairment annually as of May 1 st and between annual evaluations if changes in circumstances or the occurrence of certain events indicate potential impairment. The Company applied a quantitative assessment for all material reporting units in fiscal 2020. As part of the quantitative approach, the Company estimates the fair value of the reporting unit using a discounted cash flow approach from the perspective of a market participant. Significant estimates within the discounted cash flow analysis include cash flow forecasts, the discount rate and the terminal business value. Auditing management’s annual goodwill impairment assessment relating to goodwill amounts was complex and highly judgmental due to the significant estimation required to determine the fair value of the reporting units. In particular, the fair value estimate was sensitive to significant assumptions, such as changes in the discount rate applied, revenue growth rates, including the terminal growth rate, and operating margins, which are affected by expectations about future market or economic conditions. F-2 Table of Contents How We Addressed the Matter in Our Audit We obtained an understanding and evaluated the design and tested the operating effectiveness of controls over the Company’s goodwill impairment process, including controls over the forecasts used in the analysis, whereby the Company develops significant assumptions that are used as inputs to the annual goodwill impairment test. This included controls over management's review of the valuation model and the significant assumptions (e.g., revenue, operating margin and terminal growth rate) used to develop the prospective financial information. To test the implied fair value of the Company’s reporting units, we performed audit procedures that included, among others, assessing use of the discounted cash flow methodology and directly testing the significant assumptions and the underlying data used by the Company in its analysis, including assessing the completeness and accuracy of such underlying data. We utilized internal valuation specialists in assessing the fair value methodologies applied and evaluating the reasonableness of the discount rate selected by management. We compared the significant assumptions used by management to current industry and economic trends, historical performance, guideline public companies in the same industry and strategic plans. We considered whether the assumptions were consistent with evidence obtained in other areas of the audit. We assessed the historical accuracy of management’s estimates, and we performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the reporting units that would result from changes in the assumptions. Furthermore, we assessed the appropriateness of the disclosures in the consolidated financial statements. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2002. Cleveland, Ohio February 24, 2021 F-3 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Hyster-Yale Materials Handling, Inc. Opinion on Internal Control Over Financial Reporting We have audited Hyster-Yale Materials Handling, Inc. and Subsidiaries' ("the Company") internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive income (loss), cash flows and equity for each of the three years in the period ended December 31, 2020 and the related notes and financial statement schedule listed in the Index at Item 15(a) and our report dated February 24, 2021 expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management's report on internal control over financial reporting in Item 9A. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Cleveland, Ohio February 24, 2021 F-4 Table of Contents HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Year Ended December 31 2020 2019 2018 (In millions, except per share data) Revenues $ 2,812.1 $ 3,291.8 $ 3,179.1 Cost of sales 2,346.7 2,750.0 2,682.1 Gross Profit 465.4 541.8 497.0 Operating Expenses Selling, general and administrative expenses 415.5 487.9 458.2 Operating Profit 49.9 53.9 38.8 Other (income) expense Interest expense 13.7 19.8 16.0 Income from unconsolidated affiliates ( 6.6 ) ( 9.3 ) ( 10.0 ) Other, net 0.6 ( 4.5 ) ( 3.8 ) 7.7 6.0 2.2 Income Before Income Taxes 42.2 47.9 36.6 Income tax provision 3.7 11.3 2.3 Net Income 38.5 36.6 34.3 Net (income) loss attributable to noncontrolling interest ( 1.4 ) ( 0.8 ) 0.4 Net Income Attributable to Stockholders $ 37.1 $ 35.8 $ 34.7 Basic Earnings per Share Attributable to Stockholders $ 2.21 $ 2.15 $ 2.10 Diluted Earnings per Share Attributable to Stockholders $ 2.21 $ 2.14 $ 2.09 See Notes to Consolidated Financial Statements. F-5 Table of Contents HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Year Ended December 31 2020 2019 2018 (In millions) Net Income $ 38.5 $ 36.6 $ 34.3 Other comprehensive income (loss) Foreign currency translation adjustment 35.3 ( 7.0 ) ( 27.4 ) Current period cash flow hedging activity, net of $7.3 tax expense in 2020, net of $5.9 tax benefit in 2019 and net of $4.6 tax benefit in 2018 19.4 ( 15.9 ) ( 12.2 ) Reclassification of hedging activities into earnings, net of $4.0 tax expense in 2020, net of $4.5 tax expense in 2019 and net of $0.8 tax benefit in 2018 11.6 12.0 ( 1.8 ) Current period pension adjustment, net of $3.2 tax benefit in 2020, net of $0.1 tax expense in 2019 and net of $4.3 tax benefit in 2018 ( 14.6 ) 0.4 ( 20.1 ) Reclassification of pension into earnings, net of $0.8 tax expense in 2020, net of $0.8 tax expense in 2019 and net of $0.7 tax expense in 2018 3.9 3.2 2.9 Comprehensive Income (Loss) $ 94.1 $ 29.3 $ ( 24.3 ) Other comprehensive income (loss) attributable to noncontrolling interests Net (income) loss attributable to noncontrolling interests ( 1.4 ) ( 0.8 ) 0.4 Foreign currency translation adjustment attributable to noncontrolling interests ( 0.4 ) — 2.3 Comprehensive Income (Loss) Attributable to Stockholders $ 92.3 $ 28.5 $ ( 21.6 ) See Notes to Consolidated Financial Statements. F-6 Table of Contents HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS December 31 2020 2019 (In millions, except share data) ASSETS Current Assets Cash and cash equivalents $ 151.4 $ 64.6 Accounts receivable, net of allowances of $5.8 in 2020 and $5.6 in 2019 412.1 468.3 Inventories, net 509.4 559.9 Prepaid expenses and other 56.8 63.0 Total Current Assets 1,129.7 1,155.8 Property, Plant and Equipment, Net 340.4 308.5 Intangible Assets 58.5 60.1 Goodwill 114.7 106.7 Deferred Income Taxes 24.4 30.8 Investment in Unconsolidated Affiliates 80.2 80.0 Other Non-current Assets 111.6 105.3 Total Assets $ 1,859.5 $ 1,847.2 LIABILITIES AND EQUITY Current Liabilities Accounts payable $ 412.0 $ 401.5 Accounts payable, affiliates 16.1 15.6 Revolving credit facilities 0.7 7.7 Current maturities of long-term debt 82.4 74.6 Accrued payroll 46.1 66.1 Deferred revenue 41.7 49.1 Other current liabilities 156.9 202.4 Total Current Liabilities 755.9 817.0 Long-term Debt 206.1 204.7 Self-insurance Liabilities 30.2 31.4 Pension Obligations 19.8 13.5 Deferred Income Taxes 14.9 15.4 Other Long-term Liabilities 181.5 188.2 Total Liabilities 1,208.4 1,270.2 Stockholders’ Equity Common stock: Class A, par value $0.01 per share, 12,956,301 shares outstanding (2019 - 12,802,455 shares outstanding) 0.1 0.1 Class B, par value $0.01 per share, convertible into Class A on a one-for-one basis, 3,849,136 shares outstanding (2019 - 3,864,462 shares outstanding) 0.1 0.1 Capital in excess of par value 312.6 321.3 Treasury stock ( 6.0 ) ( 15.9 ) Retained earnings 443.2 427.4 Accumulated other comprehensive loss ( 133.1 ) ( 188.7 ) Total Stockholders’ Equity 616.9 544.3 Noncontrolling Interest 34.2 32.7 Total Equity 651.1 577.0 Total Liabilities and Equity $ 1,859.5 $ 1,847.2 See Notes to Consolidated Financial Statements. F-7 Table of Contents HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Year Ended December 31 2020 2019 2018 (In millions) Operating Activities Net income $ 38.5 $ 36.6 $ 34.3 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 42.9 43.3 44.0 Amortization of deferred financing fees 1.7 1.9 1.7 Deferred income taxes ( 2.5 ) ( 6.8 ) ( 3.2 ) Gain on sale of assets ( 1.5 ) 0.1 ( 0.3 ) Stock-based compensation 1.3 8.2 5.7 Dividends from unconsolidated affiliates 7.3 5.1 22.2 Other non-current liabilities ( 13.8 ) ( 5.5 ) ( 9.4 ) Other 22.1 20.4 8.8 Working capital changes, excluding the effect of business acquisitions: Accounts receivable 68.9 ( 9.6 ) 58.0 Inventories 66.6 ( 37.9 ) ( 125.4 ) Other current assets ( 3.6 ) ( 1.2 ) 1.3 Accounts payable 4.3 1.9 23.3 Other liabilities ( 65.3 ) 20.2 6.6 Net cash provided by operating activities 166.9 76.7 67.6 Investing Activities Expenditures for property, plant and equipment ( 51.7 ) ( 49.7 ) ( 38.8 ) Proceeds from the sale of assets 8.0 7.7 5.9 Business acquisitions, net of cash acquired — — ( 78.0 ) Net cash used for investing activities ( 43.7 ) ( 42.0 ) ( 110.9 ) Financing Activities Additions to long-term debt 72.2 67.6 71.5 Reductions of long-term debt ( 83.7 ) ( 92.1 ) ( 143.7 ) Net additions (reductions) to revolving credit agreements ( 7.4 ) ( 5.3 ) 6.5 Cash dividends paid ( 21.3 ) ( 21.0 ) ( 20.4 ) Cash dividends paid to noncontrolling interest ( 0.3 ) ( 0.2 ) ( 0.3 ) Financing fees paid — ( 0.4 ) ( 0.6 ) Other ( 0.1 ) ( 0.2 ) ( 0.6 ) Net cash used for financing activities ( 40.6 ) ( 51.6 ) ( 87.6 ) Effect of exchange rate changes on cash 4.2 ( 2.2 ) ( 5.5 ) Cash and Cash Equivalents Increase (decrease) for the year 86.8 ( 19.1 ) ( 136.4 ) Balance at the beginning of the year 64.6 83.7 220.1 Balance at the end of the year $ 151.4 $ 64.6 $ 83.7 See Notes to Consolidated Financial Statements. F-8 Table of Contents HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY Accumulated Other Comprehensive Income (Loss) Class A Common Stock Class B Common Stock Treasury Stock Capital in Excess of Par Value Retained Earnings Foreign Currency Translation Adjustment Deferred Gain on AFS Securities Deferred Gain (Loss) on Cash Flow Hedging Pension Adjustment Total Stockholders' Equity Noncontrolling Interest Total Equity (In millions) Balance, January 1, 2018 $ 0.1 $ 0.1 $ ( 31.5 ) $ 323.8 $ 389.1 $ ( 58.5 ) $ 2.8 $ ( 1.5 ) $ ( 58.9 ) $ 565.5 $ 6.9 $ 572.4 Cumulative effect of change in accounting — — — — 3.9 — ( 2.8 ) — — 1.1 — 1.1 Stock-based compensation — — — 5.7 — — — — — 5.7 — 5.7 Stock issued under stock compensation plans — — 8.0 ( 8.0 ) — — — — — — — — Purchase of treasury stock — — ( 0.6 ) — — — — — — (0.6) — (0.6) Net income (loss) — — — — 34.7 — — — — 34.7 ( 0.4 ) 34.3 Cash dividends — — — — ( 20.4 ) — — — — ( 20.4 ) ( 0.3 ) ( 20.7 ) Current period other comprehensive income (loss) — — — — — ( 27.4 ) — ( 12.2 ) ( 20.1 ) ( 59.7 ) — ( 59.7 ) Reclassification adjustment to net income — — — — — — — ( 1.8 ) 2.9 1.1 — 1.1 Acquisition of business — — — — — — — — — — 28.2 28.2 Foreign currency translation on noncontrolling interest — — — — — — — — — — ( 2.3 ) ( 2.3 ) Balance, December 31, 2018 $ 0.1 $ 0.1 $ ( 24.1 ) $ 321.5 $ 407.3 $ ( 85.9 ) $ — $ ( 15.5 ) $ ( 76.1 ) $ 527.4 $ 32.1 $ 559.5 Cumulative effect of change in accounting — — — — 5.3 — — 0.9 ( 4.8 ) 1.4 — 1.4 Stock-based compensation — — — 8.2 — — — — — 8.2 — 8.2 Stock issued under stock compensation plans — — 8.4 ( 8.4 ) — — — — — — — — Purchase of treasury stock — — ( 0.2 ) — — — — — — ( 0.2 ) — ( 0.2 ) Net income — — — — 35.8 — — — — 35.8 0.8 36.6 Cash dividends — — — — ( 21.0 ) — — — — ( 21.0 ) ( 0.2 ) ( 21.2 ) Current period other comprehensive income (loss) — — — — — ( 7.0 ) — ( 15.9 ) 0.4 ( 22.5 ) — ( 22.5 ) Reclassification adjustment to net income — — — — — — — 12.0 3.2 15.2 — 15.2 Balance, December 31, 2019 $ 0.1 $ 0.1 $ ( 15.9 ) $ 321.3 $ 427.4 $ ( 92.9 ) $ — $ ( 18.5 ) $ ( 77.3 ) $ 544.3 $ 32.7 $ 577.0 Stock-based compensation — — — 1.3 — — — — — 1.3 — 1.3 Stock issued under stock compensation plans — — 10.0 ( 10.0 ) — — — — — — — — Purchase of treasury stock — — ( 0.1 ) — — — — — ( 0.1 ) — ( 0.1 ) Net income — — — — 37.1 — — — — 37.1 1.4 38.5 Cash dividends — — — — ( 21.3 ) — — — — ( 21.3 ) ( 0.3 ) ( 21.6 ) Current period other comprehensive income (loss) — — — — — 35.3 — 19.4 ( 14.6 ) 40.1 — 40.1 Reclassification adjustment to net income — — — — — — — 11.6 3.9 15.5 — 15.5 Foreign currency translation on noncontrolling interest — — — — — — — — — — 0.4 0.4 Balance, December 31, 2020 $ 0.1 $ 0.1 $ ( 6.0 ) $ 312.6 $ 443.2 $ ( 57.6 ) $ — $ 12.5 $ ( 88.0 ) $ 616.9 $ 34.2 $ 651.1 See Notes to Consolidated Financial Statements. F-9 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES (Tabular Amounts in Millions, Except Per Share and Percentage Data) NOTE 1— Principles of Consolidation and Nature of Operations The consolidated financial statements include the accounts of Hyster-Yale Materials Handling, Inc., a Delaware corporation, and the accounts of Hyster-Yale's wholly owned domestic and international subsidiaries and majority-owned joint ventures (collectively, "Hyster-Yale" or the "Company"). All intercompany accounts and transactions among the consolidated companies are eliminated in consolidation. The Company, through its wholly owned operating subsidiary, Hyster-Yale Group, Inc. ("HYG"), designs, engineers, manufactures, sells and services a comprehensive line of lift trucks and aftermarket parts marketed globally primarily under the Hyster ® and Yale ® brand names, mainly to independent Hyster ® and Yale ® retail dealerships. Lift trucks and component parts are manufactured in the United States, China, Northern Ireland, Mexico, the Netherlands, the Philippines, Japan, Italy, Brazil and Vietnam. The sale of service parts represents approximately 14 %, 12 % and 13% of total revenues as reported in 2020, 2019 and 2018, respectively. On June 1, 2018, the Company completed the acquisition of a 75% majority interest in Hyster-Yale Maximal Forklift (Zhejiang) Co., Ltd. ("Hyster-Yale Maximal"). Hyster-Yale Maximal is a Chinese manufacturer of low-intensity and standard lift trucks and specialized material handling equipment. Hyster-Yale Maximal also designs and produces specialized products in the port equipment and rough terrain forklift markets. The results of Hyster-Yale Maximal are included in the JAPIC segment since the date of acquisition. The Company operates Bolzoni S.p.A. ("Bolzoni"). Bolzoni is a leading worldwide producer and distributor of attachments, forks and lift tables marketed under the Bolzoni ® , Auramo ® and Meyer ® brand names. Bolzoni products are manufactured in the United States, Italy, China, Germany and Finland. Through the design, production and distribution of a wide range of attachments, Bolzoni has a strong presence in the market niche of lift-truck attachments and industrial material handling. The Company operates Nuvera Fuel Cells, LLC ("Nuvera"). Nuvera is an alternative-power technology company focused on the design, manufacture and sale of hydrogen fuel-cell stacks and engines. Investments in Sumitomo NACCO Forklift Co., Ltd. ("SN"), a 50 % owned joint venture, and HYG Financial Services, Inc. ("HYGFS"), a 20 % owned joint venture, are accounted for by the equity method. SN operates manufacturing facilities in Japan, the Philippines and Vietnam from which the Company purchases certain components, service parts and lift trucks. Sumitomo Heavy Industries, Ltd. owns the remaining 50% interest in SN. Each stockholder of SN is entitled to appoint directors representing 50 % of the vote of SN’s board of directors. All matters related to policies and programs of operation, manufacturing and sales activities require mutual agreement between the Company and Sumitomo Heavy Industries, Ltd. prior to a vote of SN’s board of directors. HYGFS is a joint venture with Wells Fargo Financial Leasing, Inc. ("WF"), formed primarily for the purpose of providing financial services to independent Hyster ® and Yale ® lift truck dealers and National Account customers in the United States. National Account customers are large customers with centralized purchasing and geographically dispersed operations in multiple dealer territories. The Company’s percentage share of the net income or loss from these equity investments is reported on the line “Income from unconsolidated affiliates” in the “Other (income) expense” portion of the Consolidated Statements of Operations. NOTE 2— Significant Accounting Policies Use of Estimates: The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and judgments. These estimates and judgments affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities (if any) at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents: Cash and cash equivalents include cash in banks and highly liquid investments with original maturities of three months or less. Accounts Receivable, Net of Allowances: Allowances are maintained against accounts receivable for doubtful accounts. Allowances for doubtful accounts are maintained for estimated losses resulting from the inability or unwillingness of customers to make required payments. These allowances are based on historical experience, existing economic trends and both recent trends of specific customers estimated to be a greater credit risk as well as general trends of the entire customer pool. Accounts are written off against the allowance when it becomes evident collection will not occur. F-10 Table of Contents Self-insurance Liabilities: The Company is generally self-insured for product liability, environmental liability and medical and workers’ compensation claims. For product liability, catastrophic insurance coverage is retained for potentially significant individual claims. The Company also has insurance for certain historic product liability claims. An estimated provision for claims reported and for claims incurred but not yet reported under the self-insurance programs is recorded and revised periodically based on industry trends, historical experience and management judgment. In addition, industry trends are considered within management judgment for valuing claims. Changes in assumptions for such matters as legal judgments and settlements, legal defense costs, inflation rates, medical costs and actual experience could cause estimates to change in the near term. Advertising Costs: Advertising costs are expensed as incurred. Total advertising expense was $ 7.6 million, $ 10.7 million and $ 14.6 million in 2020, 2019 and 2018, respectively. Product Development Costs: Expenses associated with the development of new products and changes to existing products are charged to expense as incurred. These costs amounted to $ 100.5 million, $ 115.3 million and $ 110.9 million in 2020, 2019 and 2018, respectively. Foreign Currency: Assets and liabilities of non-U.S. operations are translated into U.S. dollars at the fiscal year-end exchange rate. The related translation adjustments are recorded as a separate component of equity, except for the Company’s Mexican operations. The U.S. dollar is considered the functional currency for the Company’s Mexican operations and, therefore, the effect of translating assets and liabilities from the Mexican peso to the U.S. dollar is recorded in results of operations. Revenues and expenses of all non-U.S. operations are translated using average monthly exchange rates prevailing during the year. The following table includes other significant accounting policies that are described in other notes to the consolidated financial statements, including the footnote number: Significant Accounting Policy Note Revenue Recognition Revenue Recognition (Note 3) Reportable segments Business Segments (Note 4) Stock-based compensation Common Stock and Earnings per Share (Note 6) Income taxes Income Taxes (Note 7) Derivatives and hedging activities Financial Instruments and Derivative Financial Instruments (Note 9) Fair value of financial instruments Financial Instruments and Derivative Financial Instruments (Note 9) and Retirement Benefit Plans (Note 10) Pension Retirement Benefit Plans (Note 10) Inventories Inventories (Note 11) Property, plant and equipment Property, Plant and Equipment, Net (Note 12) Impairment or disposal of long-lived assets Property, Plant and Equipment, Net (Note 12) Goodwill and intangible assets Goodwill and Intangible Assets (Note 13) Contingencies Contingencies (Note 17) Recently Issued Accounting Standards The following table provides a brief description of recent accounting pronouncements adopted January 1, 2020. Unless otherwise noted, the adoption of these standards did not have a material effect on the Company's financial position, results of operations, cash flows or related disclosures. Standard Description ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326)(Subsequent ASUs have been issued in 2018, 2019 and 2020 to update or clarify this guidance) The guidance eliminates the probable initial recognition threshold and requires an entity to reflect its current estimate of all expected credit losses. The guidance also requires additional disclosures in certain circumstances. ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities The guidance provides that indirect interests held through related parties in common control arrangements should be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 The guidance clarifies the accounting for collaborative arrangements in conjunction with the adoption of "Revenue from Contracts with Customers (Topic 606)." ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment The guidance removes the second step of the two-step test for the measurement of goodwill impairment. F-11 Table of Contents Standard Description ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement The guidance removes, modifies and adds certain disclosures relating to fair value measurements. ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract The guidance aligns the requirements for capitalizing implementation costs incurred in a hosting agreement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The following table provides a brief description of recent accounting pronouncements not yet adopted: Standard Description Required Date of Adoption Effect on the financial statements or other significant matters ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes The guidance eliminates certain exceptions to the income tax guidance related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. January 1, 2021 The adoption of the guidance will not have a material effect on the Company's financial position, results of operations, cash flows and related disclosures. ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 The guidance clarifies certain interactions between the guidance to account for certain equity securities and investments under the equity method of accounting. January 1, 2021 The adoption of the guidance will not have a material effect on the Company's financial position, results of operations, cash flows and related disclosures. ASU 2020-04, Reference Rate Reform (Topic 848) The guidance provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. From the date of issuance through December 31, 2022 The Company is currently evaluating the guidance and the effect on its financial position, results of operations, cash flows and related disclosures. NOTE 3— Revenue Revenue is recognized when obligations under the terms of a contract with the customer are satisfied, which occurs when control of the trucks, parts, or services are transferred to the customer. Revenue is measured as the amount of consideration expected to be received in exchange for transferring goods or providing services. The satisfaction of performance obligations under the terms of a revenue contract generally gives rise for the right to payment from the customer. The Company's standard payment terms vary by the type and location of the customer and the products or services offered. Generally, the time between when revenue is recognized and when payment is due is not significant. Given the insignificant days between revenue recognition and receipt of payment, financing components do not exist between the Company and its customers. Taxes collected from customers are excluded from revenue. The estimated costs of product warranties are recognized as expense when the products are sold. See Note 16 for further information on product warranties. The majority of the Company's sales contracts contain performance obligations satisfied at a point in time when title and risks and rewards of ownership have transferred to the customer. Revenues for service contracts are recognized as the services are provided. The Company also records variable consideration in the form of estimated reductions to revenues for customer programs and incentive offerings, including special pricing agreements, promotions and other volume-based incentives. Lift truck sales revenue is recorded net of estimated discounts. The estimated discount amount is based upon historical experience and trend analysis for each lift truck model. In addition to standard discounts, dealers can also request additional discounts that allow them to offer price concessions to customers. From time to time, the Company offers special incentives to increase market share or dealer stock and offers certain customers volume rebates if a specified cumulative level of purchases is obtained. For contracts with customers that include multiple performance obligations, judgment is required to determine whether performance obligations specified in these contracts are distinct and should be accounted for as separate revenue transactions F-12 Table of Contents for recognition purposes. For such arrangements, revenue is allocated to each performance obligation based on its relative standalone selling price. Standalone selling prices are generally determined based on the prices charged to customers or using expected cost plus margin. Impairment losses recognized on receivables or contract assets were not significant for the year ended December 31, 2020 and 2019. The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are reported on the line “Selling, general and administrative expenses” in the Consolidated Statements of Operations. The Company pays for shipping and handling activities regardless of when control is transferred and has elected to account for shipping and handling as activities to fulfill the promise to transfer the good, rather than a promised service. These costs are reported on the line “Cost of sales” in the Consolidated Statements of Operations. The following table disaggregates revenue by category: YEAR ENDED DECEMBER 31, 2020 Lift truck business Americas EMEA JAPIC Bolzoni Nuvera Elims Total Dealer sales $ 882.9 $ 472.0 $ 161.8 $ — $ — $ — $ 1,516.7 Direct customer sales 497.3 9.2 — — — — 506.5 Aftermarket sales 397.4 88.8 29.9 — — — 516.1 Other 113.6 18.6 1.4 283.7 3.9 ( 148.4 ) 272.8 Total Revenues $ 1,891.2 $ 588.6 $ 193.1 $ 283.7 $ 3.9 $ ( 148.4 ) $ 2,812.1 YEAR ENDED DECEMBER 31, 2019 Lift truck business Americas EMEA JAPIC Bolzoni Nuvera Elims Total Dealer sales $ 1,051.2 $ 619.1 $ 214.5 $ — $ — $ — $ 1,884.8 Direct customer sales 542.1 15.0 — — — — 557.1 Aftermarket sales 396.4 95.3 34.2 — — — 525.9 Other 133.6 21.8 1.0 345.4 10.1 ( 187.9 ) 324.0 Total Revenues $ 2,123.3 $ 751.2 $ 249.7 $ 345.4 $ 10.1 $ ( 187.9 ) $ 3,291.8 YEAR ENDED DECEMBER 31, 2018 Lift truck business Americas EMEA JAPIC Bolzoni Nuvera Elims Total Dealer sales $ 1,156.6 $ 628.1 $ 203.1 $ — $ — $ — $ 1,987.8 Direct customer sales 346.7 15.2 — — — — 361.9 Aftermarket sales 370.9 107.4 36.8 — — — 515.1 Other 113.3 18.1 2.2 349.0 17.0 ( 185.3 ) 314.3 Total Revenues $ 1,987.5 $ 768.8 $ 242.1 $ 349.0 $ 17.0 $ ( 185.3 ) $ 3,179.1 Dealer sales are recognized when the Company transfers control based on the shipping terms of the contract, which is generally when the truck is shipped from the manufacturing facility to the dealers. The majority of direct customer sales are to National Account customers. In these transactions, the Company transfers control and recognizes revenue when it delivers the product to the customer according to the terms of the contract. Aftermarket sales represent parts sales, extended warranty and maintenance services. For the sale of aftermarket parts, the Company transfers control and recognizes revenue when parts are shipped to the customer. When customers are given the right to return eligible parts and accessories, the Company estimates the expected returns based on an analysis of historical experience. The Company adjusts estimated revenues at the earlier of when the most likely amount of consideration expected to be received changes or when the consideration becomes fixed. The Company recognizes revenue for extended warranty and maintenance agreements based on the standalone selling price over the life of the F-13 Table of Contents contract, which reflects the costs to perform under these contracts and corresponds with, and thereby depicts, the transfer of control to the customer. Bolzoni revenue from external customers is primarily the sale of attachments to customers. In these transactions, the Company transfers control and recognizes revenue according to the shipping terms of the contract. In the United States, Bolzoni also has revenue for sales of forklift components to HYG plants. Nuvera's revenues include the sale of battery box replacement ("BBR") units to HYG for sale to a dealer and development funding from third-party development agreements. In all revenue transactions, the Company receives cash equal to the invoice price and amount of consideration received and the revenue recognized may vary with changes in marketing incentives. Intercompany revenues between Bolzoni, Nuvera and the lift truck business have been eliminated. During the fourth quarter of 2018, Nuvera recognized revenue which had previously been deferred related to BBR units due to the inability to estimate total future warranty costs. The BBRs are new technology and the design of the product continues to evolve. The Company determined sufficient data was available in the fourth quarter of 2018 to reasonably estimate the future costs related to the sale of BBR units, including warranty costs, which were also recorded during the fourth quarter of 2018. Deferred Revenue: The Company defers revenue for transactions that have not met the criteria for recognition at the time payment is collected, including extended warranties and maintenance contracts. In addition, for certain products, services and customer types, the Company collects payment prior to the transfer of control to the customer. Deferred Revenue Balance, December 31, 2019 $ 73.3 Customer deposits and billings 41.2 Revenue recognized ( 44.6 ) Foreign currency effect 0.6 Balance, December 31, 2020 $ 70.5 NOTE 4— Business Segments The Company’s reportable segments for the lift truck business include the following three management units: the Americas, EMEA and JAPIC. Americas includes lift truck operations in the United States, Canada, Mexico, Brazil, Latin America and its corporate headquarters. EMEA includes lift truck operations in Europe, the Middle East and Africa. JAPIC includes lift truck operations in the Asia and Pacific regions, including China, as well as the equity earnings of SN operations. In 2018, the Company completed the acquisition of the majority interest in Hyster-Yale Maximal, which is also included in the JAPIC segment from the date of acquisition. Certain amounts are allocated to these geographic management units and are included in the segment results presented below, including product development costs, corporate headquarter's expenses and information technology infrastructure costs. These allocations among geographic management units are determined by senior management and not directly incurred by the geographic operations. In addition, other costs are incurred directly by these geographic management units based upon the location of the manufacturing plant or sales units, including manufacturing variances, product liability, warranty and sales discounts, which may not be associated with the geographic management unit of the ultimate end user sales location where revenues and margins are reported. Therefore, the reported results of each segment for the lift truck business cannot be considered stand-alone entities as all segments are inter-related and integrate into a single global lift truck business. The Company reports the results of both Bolzoni and Nuvera as separate segments. Intercompany sales between Nuvera, Bolzoni and the lift truck business have been eliminated. Financial information for each of the reportable segments is presented in the following table. See Note 1 for a discussion of the Company’s product lines. Refer to Note 2 for a description of the accounting policies of the reportable segments as well as a reference table for the remaining accounting policies described in the accompanying footnotes. F-14 Table of Contents 2020 2019 2018 Revenues from external customers Americas $ 1,891.2 $ 2,123.3 $ 1,987.5 EMEA 588.6 751.2 768.8 JAPIC 193.1 249.7 242.1 Lift truck business 2,672.9 3,124.2 2,998.4 Bolzoni 283.7 345.4 349.0 Nuvera 3.9 10.1 17.0 Eliminations ( 148.4 ) ( 187.9 ) ( 185.3 ) Total $ 2,812.1 $ 3,291.8 $ 3,179.1 Gross profit (loss) Americas $ 318.1 $ 354.8 $ 314.3 EMEA 86.4 110.5 102.8 JAPIC 20.3 29.7 22.1 Lift truck business 424.8 495.0 439.2 Bolzoni 53.4 58.1 63.7 Nuvera ( 12.2 ) ( 11.2 ) ( 6.0 ) Eliminations ( 0.6 ) ( 0.1 ) 0.1 Total $ 465.4 $ 541.8 $ 497.0 Selling, general and administrative expenses Americas $ 216.0 $ 266.0 $ 238.9 EMEA 83.3 99.8 96.2 JAPIC 39.9 43.6 36.6 Lift truck business 339.2 409.4 371.7 Bolzoni 52.4 53.4 54.2 Nuvera 23.9 25.1 32.3 Total $ 415.5 $ 487.9 $ 458.2 Operating profit (loss) Americas $ 102.1 $ 88.8 $ 75.4 EMEA 3.1 10.7 6.6 JAPIC ( 19.6 ) ( 13.9 ) ( 14.5 ) Lift truck business 85.6 85.6 67.5 Bolzoni 1.0 4.7 9.5 Nuvera ( 36.1 ) ( 36.3 ) ( 38.3 ) Eliminations ( 0.6 ) ( 0.1 ) 0.1 Total $ 49.9 $ 53.9 $ 38.8 Interest expense Americas $ 11.9 $ 15.4 $ 12.4 EMEA 0.8 2.9 3.1 JAPIC 0.4 0.9 ( 0.1 ) Lift truck business 13.1 19.2 15.4 Bolzoni 0.8 0.7 0.8 Nuvera — — 0.1 Eliminations ( 0.2 ) ( 0.1 ) ( 0.3 ) Total $ 13.7 $ 19.8 $ 16.0 F-15 Table of Contents 2020 2019 2018 Interest income Americas $ ( 0.8 ) $ ( 1.2 ) $ ( 2.2 ) EMEA ( 0.4 ) ( 0.4 ) ( 0.1 ) JAPIC ( 0.1 ) ( 0.2 ) ( 0.3 ) Lift truck business ( 1.3 ) ( 1.8 ) ( 2.6 ) Bolzoni ( 0.3 ) — — Nuvera — ( 0.1 ) — Eliminations 0.2 0.1 0.2 Total $ ( 1.4 ) $ ( 1.8 ) $ ( 2.4 ) Other (income) expense Americas $ ( 1.6 ) $ ( 4.4 ) $ ( 3.8 ) EMEA ( 4.1 ) ( 3.1 ) ( 3.4 ) JAPIC 2.4 ( 3.4 ) ( 4.5 ) Lift truck business ( 3.3 ) ( 10.9 ) ( 11.7 ) Bolzoni — 0.2 0.3 Nuvera ( 1.3 ) ( 1.3 ) — Total $ ( 4.6 ) $ ( 12.0 ) $ ( 11.4 ) Income tax provision (benefit) Americas $ 21.0 $ 17.8 $ 15.5 EMEA 1.2 2.3 0.8 JAPIC ( 9.1 ) 0.7 ( 5.7 ) Lift truck business 13.1 20.8 10.6 Bolzoni — 0.2 2.1 Nuvera ( 9.2 ) ( 9.7 ) ( 10.5 ) Eliminations ( 0.2 ) — 0.1 Total $ 3.7 $ 11.3 $ 2.3 Net income (loss) attributable to stockholders Americas $ 71.6 $ 61.2 $ 53.5 EMEA 5.6 9.0 6.3 JAPIC ( 14.3 ) ( 11.9 ) ( 3.1 ) Lift truck business 62.9 58.3 56.7 Bolzoni 0.2 2.8 5.8 Nuvera ( 25.6 ) ( 25.2 ) ( 27.9 ) Eliminations ( 0.4 ) ( 0.1 ) 0.1 Total $ 37.1 $ 35.8 $ 34.7 Total assets Americas $ 1,367.1 $ 1,369.8 $ 1,259.4 EMEA 807.9 749.7 720.7 JAPIC 343.2 337.3 315.6 Eliminations ( 642.9 ) ( 627.4 ) ( 578.7 ) Lift truck business 1,875.3 1,829.4 1,717.0 Bolzoni 300.4 286.0 231.8 Nuvera 57.3 57.7 39.6 Eliminations ( 373.5 ) ( 325.9 ) ( 246.3 ) Total $ 1,859.5 $ 1,847.2 $ 1,742.1 F-16 Table of Contents 2020 2019 2018 Depreciation and amortization Americas $ 17.1 $ 17.5 $ 20.9 EMEA 6.8 6.5 7.4 JAPIC 6.2 6.6 5.2 Lift truck business 30.1 30.6 33.5 Bolzoni 11.7 11.7 9.7 Nuvera 1.1 1.0 0.8 Total $ 42.9 $ 43.3 $ 44.0 Capital expenditures Americas $ 27.4 $ 15.9 $ 20.9 EMEA 14.2 17.2 7.3 JAPIC 2.6 4.7 3.6 Lift truck business 44.2 37.8 31.8 Bolzoni 5.3 5.6 4.2 Nuvera 2.2 6.3 2.8 Total $ 51.7 $ 49.7 $ 38.8 Cash and cash equivalents Americas $ 48.7 $ 19.5 $ 19.5 EMEA 55.5 5.4 31.6 JAPIC 26.1 21.9 17.2 Lift truck business 130.3 46.8 68.3 Bolzoni 21.0 17.4 15.4 Nuvera 0.1 0.4 — Total $ 151.4 $ 64.6 $ 83.7 Data by Geographic Region No single country outside of the United States comprised 10% or more of revenues from unaffiliated customers. The “Other” category below includes Canada, Mexico, South America and the Asia and Pacific regions. In addition, no single customer comprised 10% or more of revenues from unaffiliated customers. United States Europe, Africa and Middle East Other Consolidated 2020 Revenues from unaffiliated customers, based on the customers’ location $ 1,640.8 $ 736.7 $ 434.6 $ 2,812.1 Long-lived tangible assets $ 198.4 $ 102.8 $ 119.4 $ 420.6 2019 Revenues from unaffiliated customers, based on the customers’ location $ 1,794.6 $ 923.6 $ 573.6 $ 3,291.8 Long-lived tangible assets $ 232.9 $ 103.9 $ 127.9 $ 464.7 2018 Revenues from unaffiliated customers, based on the customers’ location $ 1,655.0 $ 940.5 $ 583.6 $ 3,179.1 Long-lived tangible assets $ 180.9 $ 72.6 $ 118.3 $ 371.8 F-17 Table of Contents NOTE 5— Quarterly Results of Operations (Unaudited) A summary of the unaudited results of operations for the year ended December 31 is as follows: 2020 First Quarter Second Quarter Third Quarter Fourth Quarter Revenues $ 785.7 $ 654.4 $ 652.4 $ 719.6 Gross profit $ 136.7 $ 103.6 $ 103.4 $ 121.7 Operating profit $ 20.2 $ 8.7 $ 7.3 $ 13.7 Net income $ 15.6 $ 4.0 $ 5.7 $ 13.2 Net income attributable to stockholders $ 15.3 $ 3.6 $ 5.1 $ 13.1 Basic earnings per share $ 0.91 $ 0.21 $ 0.30 $ 0.78 Diluted earnings per share $ 0.91 $ 0.21 $ 0.30 $ 0.78 2019 First Quarter Second Quarter Third Quarter Fourth Quarter Revenues $ 834.8 $ 856.2 $ 766.0 $ 834.8 Gross profit $ 126.2 $ 139.4 $ 135.0 $ 141.2 Operating profit $ 3.4 $ 22.9 $ 19.5 $ 8.1 Net income $ 3.2 $ 16.9 $ 13.1 $ 3.4 Net income attributable to stockholders $ 3.4 $ 16.2 $ 12.8 $ 3.4 Basic earnings per share $ 0.20 $ 0.97 $ 0.77 $ 0.20 Diluted earnings per share $ 0.20 $ 0.97 $ 0.76 $ 0.20 NOTE 6— Common Stock and Earnings per Share The Company's Class A common stock is traded on the New York Stock Exchange under the ticker symbol “HY.” Because of transfer restrictions on Class B common stock, no trading market has developed, or is expected to develop, for the Company's Class B common stock. The Class B common stock is convertible into Class A common stock on a one-for-one basis at any time at the request of the holder. The Company's Class A common stock and Class B common stock have the same cash dividend rights per share. The Class A common stock has one vote per share and the Class B common stock has ten votes per share. The total number of authorized shares of Class A common stock and Class B common stock at December 31, 2020 was 125 million shares and 35 million shares, respectively. Treasury shares of Class A common stock totaling 82,670 and 221,190 at December 31, 2020 and 2019, respectively, have been deducted from shares outstanding. Stock Compensation: The Company has stock compensation plans for certain employees in the U.S. that allow the grant of shares of Class A common stock, subject to restrictions, as a means of retaining and rewarding them for long-term performance and to increase ownership in the Company. Shares awarded under the plans are fully vested and entitle the stockholder to all rights of common stock ownership except that shares may not be assigned, pledged or otherwise transferred during the restriction period. In general, the restriction period ends at the earliest of (i) five years after the participant's retirement date, (ii) four, seven or ten years from the award date, as defined in the award, or (iii) the participant's death or permanent disability. Pursuant to the plans, the Company issued 111,148 and 88,172 shares related to the years ended December 31, 2019 and 2018, respectively. There were no shares issued related to 2020. After the issuance of these shares, there were 208,570 shares of Class A common stock available for issuance under these plans. Compensation expense related to these share awards was $ 7.0 million ($ 5.5 million net of tax) and $ 4.5 million ($ 3.6 million net of tax) for the years ended 2019 and 2018, respectively. Compensation expense at the grant date represents fair value based on the market price of the shares of Class A common stock. The Company also has a stock compensation plan for non-employee directors of the Company under which a portion of the non-employee directors’ annual retainer is paid in restricted shares of Class A common stock. For the year ended December 31, 2020, $ 124,000 of each non-employee director's retainer of $ 184,000 was to be paid in restricted shares of Class A common stock. The non-employee directors' retainer was reduced by 10% from May through December of 2020. For the year ended December 31, 2019, $ 118,000 of $ 178,000 was paid in restricted shares of Class A common stock. For the year ended December 31, 2018, $ 113,000 of $ 173,000 was paid in restricted shares of Class A common stock. Shares awarded under the F-18 Table of Contents plan are fully vested and entitle the stockholder to all rights of common stock ownership except that shares may not be assigned, pledged or otherwise transferred during the restriction period. In general, the restriction period ends at the earliest of (i) ten years from the award date, (ii) the date of the director's death or permanent disability, (iii) five years (or earlier with the approval of the Board of Directors) after the director's date of retirement from the Board of Directors, or (iv) the date on which the director has both retired from the Board of Directors and reached 70 years of age. Pursuant to this plan, the Company issued 28,323 , 18,954 and 16,196 shares related to the years ended December 31, 2020, 2019 and 2018, respectively. In addition to the mandatory retainer fee received in restricted stock, directors may elect to receive shares of Class A common stock in lieu of cash for up to 100% of the balance of their annual retainer, meeting attendance fees, committee retainer and any committee chairman's fees. These voluntary shares are not subject to any restrictions. Total shares issued under voluntary elections were 1,610 , 1,711 and 2,182 in 2020, 2019 and 2018, respectively. After the issuance of these shares, there were 54,320 shares of Class A common stock available for issuance under this directors' plan. Compensation expense related to these awards was $ 1.3 million ($ 1.0 million net of tax), $ 1.2 million ($ 0.9 million net of tax) and $ 1.2 million ($ 0.9 million net of tax) for the years ended December 31, 2020, 2019 and 2018, respectively. Compensation expense at the grant date represents fair value based on the market price of the shares of Class A common stock. Earnings per Share: For purposes of calculating earnings per share, no adjustments have been made to the reported amounts of net income attributable to stockholders. In addition, basic and diluted earnings per share for Class A common stock are the same as Class B common stock. The weighted average number of shares of Class A common stock and Class B common stock outstanding used to calculate basic and diluted earnings per share were as follows: 2020 2019 2018 Basic weighted average shares outstanding 16.775 16.645 16.540 Dilutive effect of restricted stock awards 0.024 0.081 0.062 Diluted weighted average shares outstanding 16.799 16.726 16.602 Basic earnings per share $ 2.21 $ 2.15 $ 2.10 Diluted earnings per share $ 2.21 $ 2.14 $ 2.09 Cash dividends per share $ 1.2700 $ 1.2625 $ 1.2325 NOTE 7— Income Taxes The components of income before income taxes and provision for income taxes for the years ended December 31 are as follows: 2020 2019 2018 Income (loss) before income taxes U.S. $ ( 0.6 ) $ ( 18.2 ) $ ( 7.5 ) Non-U.S. 42.8 66.1 44.1 $ 42.2 $ 47.9 $ 36.6 Income tax provision Current tax provision (benefit): Federal $ 0.4 $ 3.2 $ ( 4.2 ) State 0.8 1.9 0.8 Non-U.S. 5.0 13.0 8.9 Total current $ 6.2 $ 18.1 $ 5.5 Deferred tax provision (benefit): Federal $ ( 2.6 ) $ ( 7.6 ) $ ( 2.6 ) State ( 0.6 ) ( 1.9 ) 0.3 Non-U.S. 0.7 2.7 ( 0.9 ) Total deferred $ ( 2.5 ) $ ( 6.8 ) $ ( 3.2 ) $ 3.7 $ 11.3 $ 2.3 The Company made income tax payments of $ 15.3 million, $ 12.5 million and $ 16.8 million during 2020, 2019 and 2018, respectively. The Company received income tax refunds of $ 0.2 million, $ 3.7 million and $ 0.8 million during 2020, 2019 and 2018, respectively. F-19 Table of Contents A reconciliation of the federal statutory and reported income tax rate for the year ended December 31 is as follows: 2020 2019 2018 Income before income taxes $ 42.2 $ 47.9 $ 36.6 Statutory taxes at 21% $ 8.9 $ 10.1 $ 7.7 Tax controversy resolution ( 5.8 ) ( 1.4 ) ( 0.4 ) Federal income tax credits ( 2.6 ) ( 4.0 ) ( 3.7 ) Equity interest earnings ( 1.0 ) ( 1.5 ) ( 1.7 ) Unremitted non-U.S. earnings ( 0.7 ) 1.7 — Base-erosion and anti-abuse tax ( 0.4 ) 1.4 — Non-U.S. rate differences ( 0.3 ) 0.9 ( 1.5 ) Valuation allowance 2.9 0.8 3.0 Global intangible low-taxed income 1.8 2.0 1.2 Other 0.8 ( 0.3 ) 0.3 State income taxes 0.1 ( 0.2 ) — Tax Reform Act — 0.1 ( 4.4 ) Nondeductible compensation — 1.7 0.9 Capitalized acquisition costs — — 0.9 Income tax provision $ 3.7 $ 11.3 $ 2.3 Reported income tax rate 8.8 % 23.6 % 6.3 % As a result of the Tax Reform Act in 2017, the Company recorded provisional tax effects due to the transition tax on the unremitted earnings and profits of non-U.S. subsidiaries and the Company’s deferred tax assets and liabilities as of December 31, 2017. The Company has since finalized its calculation of earnings and profits, including the amounts held in cash or other specified assets and its calculation of available foreign tax credits consistent with the additional regulatory guidance issued during 2018 and 2019, resulting in a reduction in tax expense of $ 4.4 million and an increase in tax expense of $ 0.1 million in 2018 and 2019, respectively. After the utilization of existing tax credits, the Company will pay cash taxes, including state income taxes, of $ 17.7 million with respect to the transition tax payable over an installment period of eight years, beginning in 2018. The Company has provided for the anticipated withholding taxes on unremitted non-U.S. earnings for which no reinvestment plan has been identified and that may be repatriated in the foreseeable future. As such, the Company has provided a deferred tax liability with respect to these earnings of $ 1.0 million and $ 1.7 million at December 31, 2020 and 2019, respectively. While the Tax Reform Act provides for a territorial system, beginning in 2018, it includes new anti-deferral and anti-base erosion provisions, the global intangible low-taxed income (“GILTI”) provisions and the base-erosion and anti-abuse tax (“BEAT”) provisions. The GILTI provisions require the Company to include non-U.S. earnings in excess of an allowable return on the Company’s non-U.S. subsidiary’s tangible assets in its U.S. income tax return. The Company has elected to account for GILTI tax in the period in which it is incurred, and therefore has not provided any deferred tax amounts for GILTI. The BEAT provisions in the Tax Reform Act create a minimum tax where a lower tax rate is applied to taxable income determined without the benefit of certain base-erosion payments made to related non-U.S. corporations. The base-erosion payments primarily consist of reimbursements for research and development performed by the Company's non-U.S. engineering centers. The Company will only be taxed under this regime if such minimum tax exceeds the regular U.S. corporate income tax. During 2020, the Company recorded a favorable adjustment of $ 0.4 million for BEAT which consisted of a current provision of $ 0.8 million offset by a favorable return to provision adjustment of $ 1.2 million. The Company continually evaluates its deferred tax assets to determine if a valuation allowance is required. A valuation allowance is required where realization is determined to no longer meet the "more likely than not" standard. F-20 Table of Contents A detailed summary of the total deferred tax assets and liabilities in the Consolidated Balance Sheets resulting from differences in the book and tax basis of assets and liabilities follows: December 31 2020 2019 Deferred tax assets Tax attribute carryforwards $ 21.2 $ 25.3 Product warranties 12.2 11.2 Accrued expenses and reserves 9.0 16.4 Research and development capitalization 7.2 2.5 Accrued product liability 6.2 8.9 Other employee benefits 5.7 7.1 Accrued pension benefits 3.3 2.4 Inventories 2.9 1.7 Other 2.9 0.6 Total deferred tax assets 70.6 76.1 Less: Valuation allowance 28.2 31.4 42.4 44.7 Deferred tax liabilities Depreciation and amortization 31.9 27.6 Unremitted earnings 1.0 1.7 Total deferred tax liabilities 32.9 29.3 Net deferred tax asset $ 9.5 $ 15.4 The following table summarizes the tax carryforwards and associated carryforward periods and related valuation allowances where the Company has determined that realization is uncertain: December 31, 2020 Net deferred tax asset Valuation allowance Carryforwards expire during: Non-U.S. net operating loss $ 12.6 $ 10.0 2021 - Indefinite Non-U.S. capital losses 7.0 7.0 2021 - Indefinite State net operating losses and credits 4.2 3.0 2021 - 2039 Less: Unrecognized tax benefits ( 2.6 ) — Total $ 21.2 $ 20.0 December 31, 2019 Net deferred tax asset Valuation allowance Carryforwards expire during: Non-U.S. net operating loss $ 17.0 $ 13.1 2020 - Indefinite Non-U.S. capital losses 6.7 6.7 2020 - Indefinite State net operating losses and credits 4.1 3.1 2020 - 2038 Less: Unrecognized tax benefits ( 2.5 ) — Total $ 25.3 $ 22.9 The establishment of a valuation allowance does not have an impact on cash, nor does such an allowance preclude the Company from using its loss carryforwards or other deferred tax assets in future periods. The tax net operating losses attributable to Brazil, Australia and China comprise a substantial portion of the non-U.S. net operating loss deferred tax assets. The Brazilian and Australian net operating losses do not expire under local law, while Chinese losses expire after five years. During 2020 and 2019, the valuation allowance provided against deferred tax assets decreased by $ 3.2 million and increased by $ 0.5 million, respectively. The change in the total valuation allowance in 2020 and 2019 included a net increase in tax expense F-21 Table of Contents of $ 2.9 million and $ 0.8 million, respectively. The change also included a net decrease of $5.5 million in 2020 for the write-down of the Australian losses recorded directly against the associated valuation allowance where such losses were no longer available under Australian tax rules and a net decrease of $ 0.6 million and $ 0.3 million in 2020 and 2019 recorded directly in equity. Based upon a review of historical earnings and trends, forecasted earnings and the relevant expiration of carryforwards, the Company believes the valuation allowances provided are appropriate. At December 31, 2020, the Company had gross net operating loss carryforwards in U.S. state jurisdictions of $ 11.1 million and non-U.S. jurisdictions of $ 43.7 million. The following is a reconciliation of total gross unrecognized tax benefits, defined as the aggregate tax effect of differences between the Company's tax return positions and the benefits recognized in the consolidated financial statements for the years ended December 31, 2020, 2019 and 2018. Approximately $ 10.7 million, $ 13.5 million and $ 15.1 million of these amounts as of December 31, 2020, 2019 and 2018, respectively, relate to permanent items that, if recognized, would impact the reported income tax rate. This amount differs from gross unrecognized tax benefits presented in the table below due to the increase in U.S. federal income taxes which would occur upon the recognition of the state tax benefits included herein. 2020 2019 2018 Balance at January 1 $ 13.6 $ 15.2 $ 10.9 Additions based on tax positions related to the current year 0.3 0.3 0.4 Additions for tax positions of prior years 0.1 0.2 0.3 Additions for business acquisitions — — 6.0 Reductions due to settlements with taxing authorities and the lapse of the applicable statute of limitations ( 3.9 ) ( 2.0 ) ( 1.6 ) Other changes in unrecognized tax benefits including foreign currency translation adjustments 0.7 ( 0.1 ) ( 0.8 ) Balance at December 31 $ 10.8 $ 13.6 $ 15.2 The Company records interest and penalties on uncertain tax positions as a component of the income tax provision. The Company recorded a net decrease of $ 2.3 million during 2020, and a net increase of $ 0.1 million and $ 0.5 million during 2019 and 2018, respectively, in interest and penalties. As a result of foreign currency translation into U.S. dollars, the total amount of interest and penalties increased by $ 0.4 million during 2020 and decreased by $ 0.5 million during 2018. The total amount of interest and penalties accrued was $ 6.7 million, $ 8.6 million and $ 8.5 million as of December 31, 2020, 2019 and 2018, respectively. The Company expects the amount of unrecognized tax benefits will change within the next twelve months. It is reasonably possible the Company will record unrecognized tax benefits, including interest and penalties, within the next twelve months up to $ 7.0 million resulting from the possible expiration of certain statutes of limitation and settlement of audits. If recognized, the previously unrecognized tax benefits will be recorded as discrete tax benefits in the interim period in which the items are effectively settled. Approximately $ 3.2 million of the amount that may be recognized in the next twelve months relates to prior business acquisitions, and such amounts will be offset with the pretax reduction of the related indemnity receivable. The tax returns of the Company and its non-U.S. subsidiaries are routinely examined by various taxing authorities. The Company has not been informed of any material assessment for which an accrual has not been previously provided and the Company would vigorously contest any material assessment. Management believes any potential adjustment would not materially affect the Company's financial condition or results of operations. In general, the Company operates in taxing jurisdictions that provide a statute of limitations period ranging from three to five years for the taxing authorities to review the applicable tax filings. The Company is currently under examination by the Internal Revenue Service for its 2018 U.S. tax filings. The Company expects this examination to be completed during 2021. The examination of U.S. federal tax returns for all years prior to 2017 have been settled with the Internal Revenue Service or otherwise have essentially closed under the applicable statute of limitations. However, the Company has elected to voluntarily extend the statute of limitations for the U.S. federal tax return for 2012 at the request of its prior parent company such that attributes may be adjusted in limited circumstances. The Company is routinely under examination in various state and non-U.S. jurisdictions and in most cases the statute of limitations has not been extended. The Company believes these examinations are routine in nature and are not expected to result in any material tax assessments. F-22 Table of Contents NOTE 8— Reclassifications from OCI The following table summarizes reclassifications out of accumulated other comprehensive income (loss) ("OCI") for each year ended December 31 as recorded in the Consolidated Statements of Operations: Details about OCI Components Amount Reclassified from OCI Affected Line Item in the Statement Where Net Income Is Presented 2020 2019 2018 Gain (loss) on cash flow hedges: Interest rate contracts $ 1.9 $ ( 0.3 ) $ — Interest expense Foreign exchange contracts ( 17.5 ) ( 16.2 ) 2.6 Cost of sales Total before tax ( 15.6 ) ( 16.5 ) 2.6 Income before income taxes Tax expense (benefit) 4.0 4.5 ( 0.8 ) Income tax provision Net of tax $ ( 11.6 ) $ ( 12.0 ) $ 1.8 Net income Amortization of defined benefit pension items: Actuarial loss $ ( 4.7 ) $ ( 3.9 ) $ ( 3.8 ) Other, net Prior service (cost) credit — ( 0.1 ) 0.2 Other, net Total before tax ( 4.7 ) ( 4.0 ) ( 3.6 ) Income before income taxes Tax expense 0.8 0.8 0.7 Income tax provision Net of tax $ ( 3.9 ) $ ( 3.2 ) $ ( 2.9 ) Net income Total reclassifications for the period $ ( 15.5 ) $ ( 15.2 ) $ ( 1.1 ) NOTE 9— Financial Instruments and Derivative Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term maturities of these instruments. The fair values of revolving credit agreements and long-term debt, excluding finance leases, were determined using current rates offered for similar obligations taking into account company credit risk. This valuation methodology is Level 2 as defined in the fair value hierarchy. At December 31, 2020, the total carrying value and total fair value of revolving credit agreements and long-term debt, excluding finance leases, was $ 260.5 million and $ 257.2 million, respectively. At December 31, 2019, the total carrying value and total fair value of revolving credit agreements and long-term debt, excluding finance leases, was $ 266.0 million and $ 265.1 million, respectively. Financial instruments that potentially subject the Company to concentration of credit risk consist principally of accounts receivable and derivatives. The large number of customers comprising the Company’s customer base and their dispersion across many different industries and geographies mitigates concentration of credit risk on accounts receivable. To further reduce credit risk associated with accounts receivable, the Company performs periodic credit evaluations of its customers, and in certain circumstances may require advance payments or collateral. The Company enters into derivative contracts with high-quality financial institutions and limits the amount of credit exposure to any one institution. Derivative Financial Instruments Financial instruments held by the Company include cash and cash equivalents, accounts receivable, accounts payable, revolving credit agreements, long-term debt, interest rate swap agreements and forward foreign currency exchange contracts. The Company does not hold or issue financial instruments or derivative financial instruments for trading purposes. The Company uses forward foreign currency exchange contracts to partially reduce risks related to transactions denominated in foreign currencies. These contracts hedge firm commitments and forecasted transactions relating to cash flows associated with sales and purchases denominated in non-functional currencies. The Company offsets fair value amounts related to foreign currency exchange contracts executed with the same counterparty. Changes in the fair value of forward foreign currency exchange contracts that are effective as hedges are recorded in OCI. Deferred gains or losses are reclassified from OCI to the Consolidated Statements of Operations in the same period as the gains or losses from the underlying transactions are recorded and are generally recognized in cost of sales. The Company periodically enters into foreign currency exchange contracts that do not meet the criteria for hedge accounting. These derivatives are used to reduce the Company’s exposure to foreign currency risk related to forecasted purchase or sales transactions or forecasted intercompany cash payments or settlements. Gains and losses on these derivatives are generally recognized in cost of sales. F-23 Table of Contents The Company periodically enters into forward foreign currency contracts that are designated as net investment hedges of the Company's net investment in its foreign subsidiaries. For derivative instruments that are designated and qualified as a hedge of a net investment in foreign currency, the gain or loss is reported in other comprehensive income as part of the cumulative translation adjustment to the extent it is effective. The Company utilizes the forward-rate method of assessing hedge effectiveness. The Company periodically enters into cross-currency swaps which hedge the variability of expected future cash flows that are attributable to foreign currency risk of certain intercompany loans. Changes in the fair value of cross-currency swaps that are effective as hedges are recorded in OCI. Deferred gains or losses are reclassified from OCI to the Consolidated Statements of Operations in the same period as the gains or losses from the underlying transactions are recorded and are generally recognized in other (income) expense and interest expense. The Company uses interest rate swap agreements to partially reduce risks related to floating rate financing agreements that are subject to changes in the market rate of interest. Terms of the interest rate swap agreements require the Company to receive a variable interest rate and pay a fixed interest rate. The Company's interest rate swap agreements and its variable rate financings are predominately based upon one-month LIBOR. Changes in the fair value of interest rate swap agreements that are effective as hedges are recorded in OCI. Deferred gains or losses are reclassified from OCI to the Consolidated Statements of Operations in the same period as the gains or losses from the underlying transactions are recorded and are generally recognized in interest expense. Cash flows from hedging activities are reported in the Consolidated Statements of Cash Flows in the same classification as the hedged item, generally as a component of cash flows from operations. The Company measures its derivatives at fair value on a recurring basis using significant observable inputs. This valuation methodology is Level 2 as defined in the fair value hierarchy. The Company uses a present value technique that incorporates yield curves and foreign currency spot rates to value its derivatives and also incorporates the effect of the Company's and its counterparties' credit risk into the valuation. The Company does not currently hold any nonderivative instruments designated as hedges or any derivatives designated as fair value hedges. Foreign Currency Derivatives: The Company held forward foreign currency exchange contracts with a total notional amount of $ 840.5 million at December 31, 2020, primarily denominated in euros, U.S. dollars, Japanese yen, British pounds, Chinese renminbi, Mexican pesos, Swedish kroner and Australian dollars. The Company held forward foreign currency exchange contracts with total notional amounts of $ 1.0 billion at December 31, 2019, primarily denominated in euros, U.S. dollars, Japanese yen, British pounds, Mexican pesos, Australian dollars, Swedish kroner, Brazilian real and Chinese renminbi. The fair value of these contracts approximated a net asset of $ 23.5 million and a net liability $ 19.8 million at December 31, 2020 and 2019, respectively. For the years ended December 31, 2020 and 2019, there was no material ineffectiveness of forward foreign currency exchange contracts that qualify for hedge accounting. Forward foreign currency exchange contracts that qualify for hedge accounting are generally used to hedge transactions expected to occur within the next 36 months. The mark-to-market effect of forward foreign currency exchange contracts that are considered effective as hedges has been included in OCI. Based on market valuations at December 31, 2020, $ 6.1 million of the amount of net deferred gain included in OCI at December 31, 2020 is expected to be reclassified as expense into the Consolidated Statements of Operations over the next twelve months, as the transactions occur. Interest Rate Derivatives: The Company holds certain contracts that hedge interest payments on its $200.0 million term loan (the "Term Loan") borrowings. The following table summarizes the notional amounts, related rates, excluding spreads, and remaining terms of interest rate swap agreements at December 31, 2020 and 2019: Notional Amount Average Fixed Rate December 31 December 31 December 31 December 31 2020 2019 2020 2019 Term at December 31, 2020 $ 56.5 $ 56.5 1.94 % 1.94 % Extending to November 2022 65.7 74.6 2.20 % 2.20 % Extending to May 2023 The fair value of a l l interest rate swap agreements was a net liability of $ 4.9 million and $ 2.1 million at December 31, 2020 and 2019, respectively. The mark-to-market effect of interest rate swap agreements that are considered effective as hedges has been included in OCI. Based on market valuations at December 31, 2020, $ 1.8 million of the net deferred loss included in OCI is expected to be reclassified as expense in the Consolidated Statement of Operations over the next twelve months, as cash flow payments are made in accordance with the interest rate swap agreements. F-24 Table of Contents The following table summarizes the fair value of derivative instruments at December 31 as recorded in the Consolidated Balance Sheets: Asset Derivatives Liability Derivatives Balance sheet location 2020 2019 Balance sheet location 2020 2019 Derivatives designated as hedging instruments Cash Flow Hedges Interest rate swap agreements Current Other current liabilities $ — $ — Other current liabilities $ 2.5 $ 0.7 Long-term Other long-term liabilities — — Other long-term liabilities 2.4 1.4 Foreign currency exchange contracts Current Prepaid expenses and other 15.7 3.1 Prepaid expenses and other 2.9 1.5 Other current liabilities 1.0 1.7 Other current liabilities 3.6 17.1 Long-Term Other non-current assets 11.3 — Other non-current assets 0.1 — Other long-term liabilities — 3.5 Other long-term liabilities — 9.6 Total derivatives designated as hedging instruments $ 28.0 $ 8.3 $ 11.5 $ 30.3 Derivatives not designated as hedging instruments Cash Flow Hedges Foreign currency exchange contracts Current Prepaid expenses and other $ 2.8 $ 0.4 Prepaid expenses and other $ 0.9 $ 0.2 Other current liabilities 0.7 2.3 Other current liabilities 0.5 2.4 Total derivatives not designated as hedging instruments $ 3.5 $ 2.7 $ 1.4 $ 2.6 Total derivatives $ 31.5 $ 11.0 $ 12.9 $ 32.9 The following table summarizes the offsetting of the fair value of derivative instruments on a gross basis by counterparty at December 31, 2020 and 2019 as recorded in the Consolidated Balance Sheets: Derivative Assets as of December 31, 2020 Derivative Liabilities as of December 31, 2020 Gross Amounts of Recognized Assets Gross Amounts Offset Net Amounts Presented Net Amount Gross Amounts of Recognized Liabilities Gross Amounts Offset Net Amounts Presented Net Amount Cash Flow Hedges Interest rate swap agreements $ — $ — $ — $ — $ 4.9 $ — $ 4.9 $ 4.9 Foreign currency exchange contracts 25.9 ( 2.4 ) 23.5 23.5 2.4 ( 2.4 ) — — Total derivatives $ 25.9 $ ( 2.4 ) $ 23.5 $ 23.5 $ 7.3 $ ( 2.4 ) $ 4.9 $ 4.9 Derivative Assets as of December 31, 2019 Derivative Liabilities as of December 31, 2019 Gross Amounts of Recognized Assets Gross Amounts Offset Net Amounts Presented Net Amount Gross Amounts of Recognized Liabilities Gross Amounts Offset Net Amounts Presented Net Amount Cash Flow Hedges Interest rate swap agreements $ — $ — $ — $ — $ 2.1 $ — $ 2.1 $ 2.1 Foreign currency exchange contracts 1.8 ( 1.8 ) — — 21.6 ( 1.8 ) 19.8 19.8 Total derivatives $ 1.8 $ ( 1.8 ) $ — $ — $ 23.7 $ ( 1.8 ) $ 21.9 $ 21.9 F-25 Table of Contents The following table summarizes the pre-tax impact of derivative instruments for each year ended December 31 as recorded in the Consolidated Statements of Operations: Derivatives in Cash Flow Hedging Relationships Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion) Location of Gain or (Loss) Reclassified from OCI into Income (Effective Portion) Amount of Gain or (Loss) Reclassified from OCI into Income (Effective Portion) 2020 2019 2018 2020 2019 2018 Cash Flow Hedges Interest rate swap agreements $ ( 1.0 ) $ ( 3.8 ) $ 2.0 Interest expense $ 1.9 $ ( 0.3 ) $ — Foreign currency exchange contracts 27.7 ( 18.0 ) ( 18.8 ) Cost of sales ( 17.5 ) ( 16.2 ) 2.6 $ 26.7 $ ( 21.8 ) $ ( 16.8 ) $ ( 15.6 ) $ ( 16.5 ) $ 2.6 Derivatives Not Designated as Hedging Instruments Location of Gain or (Loss) Recognized in Income on Derivative Amount of Gain or (Loss) Recognized in Income on Derivative 2020 2019 2018 Cash flow hedges Interest rate swap agreements Other $ — $ — $ 0.3 Foreign currency exchange contracts Cost of sales 4.5 ( 5.3 ) ( 2.3 ) Total $ 4.5 $ ( 5.3 ) $ ( 2.0 ) NOTE 10— Retirement Benefit Plans Defined Benefit Plans: The Company maintains various defined benefit pension plans that provide benefits based on years of service and average compensation during certain periods. The Company’s policy is to make contributions to fund these plans within the range allowed by applicable regulations. Plan assets consist primarily of publicly traded stocks and government and corporate bonds. Pension benefits for employees covered under the Company’s U.S. and U.K. plans are frozen. Only certain grandfathered employees in the Netherlands still earn retirement benefits under defined benefit pension plans. All other eligible employees of the Company, including employees whose pension benefits are frozen, receive retirement benefits under defined contribution retirement plans. During 2020 and 2018, the Company recognized a settlement loss of $ 1.2 million and $ 1.1 million, respectively, resulting from lump-sum distributions exceeding the total projected interest cost for the plan year for its U.S. pension plan. The assumptions used in accounting for the defined benefit plans were as follows for the years ended December 31: 2020 2019 2018 United States Plans Weighted average discount rates 2.09 % 3.02 % 4.10 % Expected long-term rate of return on assets 7.00 % 7.50 % 7.50 % Cash balance interest crediting rate 3.50% 3.50% 3.50% Non-U.S. Plans Weighted average discount rates 0.50%-1.30% 0.37%-1.85% 1.13%-2.65% Rate of increase in compensation levels 1.00%-2.50% 1.00%-2.50% 1.50%-2.50% Expected long-term rate of return on assets 0.50%-6.00% 1.00%-7.00% 1.80%-7.00% Each year, the assumptions used to calculate the benefit obligation are used to calculate the net periodic pension expense for the following year. Set forth below is a detail of the net periodic pension expense for the defined benefit plans for the years ended December 31: F-26 Table of Contents 2020 2019 2018 United States Plans Interest cost $ 1.9 $ 2.6 $ 2.5 Expected return on plan assets ( 4.7 ) ( 4.5 ) ( 4.9 ) Amortization of actuarial loss 2.1 2.0 1.8 Amortization of prior service credit — — ( 0.2 ) Settlements 1.2 — 1.1 Net periodic pension expense $ 0.5 $ 0.1 $ 0.3 Non-U.S. Plans Service cost $ 0.2 $ 0.1 $ 0.2 Interest cost 3.1 4.1 4.0 Expected return on plan assets ( 10.9 ) ( 10.2 ) ( 10.5 ) Amortization of actuarial loss 2.6 1.9 2.0 Amortization of prior service cost — 0.1 — Net periodic pension benefit $ ( 5.0 ) $ ( 4.0 ) $ ( 4.3 ) Set forth below is a detail of other changes in plan assets and benefit obligations recognized in other comprehensive income (loss) for the year ended December 31: 2020 2019 2018 United States Plans Current year actuarial (gain) loss $ 0.7 $ ( 0.4 ) $ 4.8 Amortization of actuarial loss ( 2.1 ) ( 2.0 ) ( 1.8 ) Amortization of prior service credit — — 0.2 Curtailments and Settlements ( 1.2 ) — ( 1.1 ) Total recognized in other comprehensive income (loss) $ ( 2.6 ) $ ( 2.4 ) $ 2.1 Non-U.S. Plans Current year actuarial (gain) loss $ 18.3 $ ( 0.1 ) $ 18.8 Current year prior service (credit) cost ( 0.1 ) — 1.9 Amortization of actuarial loss ( 2.6 ) ( 1.9 ) ( 2.0 ) Amortization of prior service (cost) credit — ( 0.1 ) — Total recognized in other comprehensive income (loss) $ 15.6 $ ( 2.1 ) $ 18.7 F-27 Table of Contents The following table sets forth the changes in the benefit obligation and the plan assets during the year and the funded status of the defined benefit plans at December 31: 2020 2019 U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans Change in benefit obligation Projected benefit obligation at beginning of year $ 70.2 $ 186.3 $ 66.8 $ 166.4 Service cost — 0.2 — 0.1 Interest cost 1.9 3.1 2.6 4.1 Actuarial (gain) loss 4.6 21.7 6.5 17.7 Benefits paid ( 4.5 ) ( 6.8 ) ( 5.7 ) ( 6.9 ) Employee contributions — 0.2 — 0.2 Lump sum payments ( 2.2 ) — — — Foreign currency exchange rate changes — 8.6 — 4.7 Projected benefit obligation at end of year $ 70.0 $ 213.3 $ 70.2 $ 186.3 Accumulated benefit obligation at end of year $ 70.0 $ 212.2 $ 70.2 $ 185.6 Change in plan assets Fair value of plan assets at beginning of year $ 66.4 $ 179.5 $ 60.7 $ 152.3 Actual return on plan assets 8.5 15.0 11.4 27.9 Employer contributions 0.4 2.3 — 1.2 Employee contributions — 0.2 — 0.2 Benefits paid ( 4.5 ) ( 6.8 ) ( 5.7 ) ( 6.9 ) Settlements ( 2.2 ) — — — Foreign currency exchange rate changes — 7.7 — 4.8 Fair value of plan assets at end of year $ 68.6 $ 197.9 $ 66.4 $ 179.5 Funded status at end of year $ ( 1.4 ) $ ( 15.4 ) $ ( 3.8 ) $ ( 6.8 ) Amounts recognized in the consolidated balance sheets consist of: Noncurrent liabilities $ ( 1.4 ) $ ( 15.4 ) $ ( 3.8 ) $ ( 6.8 ) $ ( 1.4 ) $ ( 15.4 ) $ ( 3.8 ) $ ( 6.8 ) Components of accumulated other comprehensive income (loss) consist of: Actuarial loss $ 34.7 $ 70.6 $ 37.3 $ 54.9 Prior service cost (credit) — 1.6 — 1.7 Deferred taxes ( 8.7 ) ( 10.6 ) ( 9.4 ) ( 7.6 ) Change in statutory tax rate 0.4 ( 2.0 ) 0.4 ( 2.0 ) Foreign currency translation adjustment — 2.0 — 2.0 $ 26.4 $ 61.6 $ 28.3 $ 49.0 The projected benefit obligation included in the table above represents the actuarial present value of benefits attributable to employee service rendered to date, including the effects of estimated future pay increases. The accumulated benefit obligation also reflects the actuarial present value of benefits attributable to employee service rendered to date, but does not include the effects of estimated future pay increases. In 2021, the Company expects to contribute $ 3.1 million to its non-U.S. pension plans. The Company does not expect to contribute to its U.S. pension plan in 2021. F-28 Table of Contents Pension benefit payments are made from assets of the pension plans. Future pension benefit payments expected to be paid from assets of the pension plans are: U.S. Plans Non-U.S. Plans 2021 $ 6.1 $ 7.3 2022 5.8 7.4 2023 5.5 7.5 2024 5.3 7.6 2025 5.0 7.8 2026 - 2030 20.5 44.2 $ 48.2 $ 81.8 The expected long-term rate of return on defined benefit plan assets reflects management’s expectations of long-term rates of return on funds invested to provide for benefits included in the projected benefit obligations. The Company has established the expected long-term rate of return assumption for plan assets by considering the historical rates of return over a period of time that is consistent with the long-term nature of the underlying obligations of these plans as well as a forward-looking rate of return. The historical and forward-looking rates of return for each of the asset classes used to determine the Company's estimated rate of return assumption were based upon the rates of return earned or expected to be earned by investments in the equivalent benchmark market indices for each of the asset classes. Expected returns for the U.K. pension plan is based on a calculated market-related value of assets. Under this methodology, asset gains and losses resulting from actual returns that differ from the Company’s expected returns are recognized in the market-related value of assets ratably over three years. The pension plans maintain an investment policy that, among other things, establishes a portfolio asset allocation methodology with percentage allocation bands for individual asset classes. The investment policy provides that investments are reallocated between asset classes as balances exceed or fall below the appropriate allocation bands. The following is the actual allocation percentage and target allocation percentage for the Company's U.S. pension plan assets at December 31: 2020 Actual Allocation 2019 Actual Allocation Target Allocation U.S. equity securities 40.9 % 45.4 % 40 % Non-U.S. equity securities 20.8 % 20.2 % 20 % Fixed income securities 37.6 % 33.7 % 40 % Money market 0.6 % 0.7 % — % The following is the actual allocation percentage and target allocation percentage for the Company's U.K. pension plan assets at December 31: 2020 Actual Allocation 2019 Actual Allocation Target Allocation U.K. equity securities 5.1 % 10.4 % 5 % Non-U.K. equity securities 55.4 % 60.7 % 55 % Fixed income securities 39.1 % 28.1 % 40 % Money market 0.4 % 0.8 % — % The Company maintains a pension plan for certain employees in the Netherlands which has purchased annuity contracts to meet its obligations. The defined benefit pension plans do not have any direct ownership of Hyster-Yale common stock. The fair value of each major category of U.S. plan assets for the Company’s pension plan are valued using quoted market prices in active markets for identical assets, or Level 1 in the fair value hierarchy. The fair value of each major category of Non-U.S. plan assets for the Company’s pension plans are valued using observable inputs, either directly or indirectly, other than quoted market prices in active markets for identical assets, or Level 2 in the fair value hierarchy. F-29 Table of Contents Following are the values as of December 31: Level 1 Level 2 2020 2019 2020 2019 U.S. equity securities $ 28.1 $ 30.2 $ 34.2 $ 34.4 U.K. equity securities — — 9.0 16.9 Non-U.S., non-U.K. equity securities 14.3 13.4 64.9 64.8 Fixed income securities 25.8 22.4 89.1 62.1 Money market 0.4 0.4 0.7 1.3 Total $ 68.6 $ 66.4 $ 197.9 $ 179.5 Defined Contribution Plans: The Company has defined contribution (401(k)) plans for substantially all U.S. employees and similar plans for employees outside of the United States. The Company generally matches employee contributions based on plan provisions. In addition, in the United States and United Kingdom, the Company has defined contribution retirement plans whereby the contribution to participants is determined annually based on a formula that includes the effect of actual compared with targeted operating results and the age and compensation of the participants. Total costs, including Company contributions, for these plans were $ 10.0 million, $ 26.6 million and $ 26.5 million in 2020, 2019 and 2018, respectively. Company contributions to these plans were suspended from May through December of 2020. NOTE 11— Inventories Inventories are stated at the lower of cost or market for last-in, first-out (“LIFO”) inventory or lower of cost or net realizable value for first-in, first-out (“FIFO”) inventory. At December 31, 2020 and 2019, 42 % and 53 %, respectively, of total inventories were determined using the LIFO method, which consists primarily of manufactured inventories, including service parts for the lift truck business in the United States. The FIFO method is used with respect to all other inventories. The cost components of inventory include raw materials, purchased components, direct and indirect labor, utilities, depreciation, inbound freight charges, purchasing and receiving costs, inspection costs and warehousing costs. Reserves are maintained for estimated obsolescence or excess inventory equal to the difference between the cost of inventory and the net realizable value based upon assumptions about future demand and market conditions. Upon a subsequent sale or disposal of the impaired inventory, the corresponding reserve for impaired value is relieved to ensure that the cost basis of the inventory reflects any write-downs. Inventories are summarized as follows: December 31 2020 2019 Finished goods and service parts $ 269.0 $ 276.2 Work in process 21.0 22.1 Raw materials 269.4 310.5 Total manufactured inventories 559.4 608.8 LIFO reserve ( 50.0 ) ( 48.9 ) Total inventory $ 509.4 $ 559.9 NOTE 12— Property, Plant and Equipment, Net Property, plant and equipment are recorded at cost. Depreciation and amortization are provided in amounts sufficient to amortize the cost of the assets, including assets recorded under finance leases, over their estimated useful lives using the straight-line method. Buildings are generally depreciated using a 20, 40 or 50-year life, improvements to land and buildings are depreciated over estimated useful lives ranging up to 40 years and equipment is depreciated over estimated useful lives ranging from three to 15 years. Capital grants received for the acquisition of equipment are recorded as reductions of the related equipment cost and reduce future depreciation expense. Repairs and maintenance costs are expensed when incurred. The Company periodically evaluates long-lived assets, including intangible assets with finite lives, for impairment when changes in circumstances or the occurrence of certain events indicate the carrying amount of an asset may not be recoverable. Upon identification of indicators of impairment, assets and liabilities are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets or liabilities. The asset group would be considered impaired when the estimated future undiscounted cash flows generated by the asset group are less than carrying value. If the carrying F-30 Table of Contents value of an asset group is considered impaired, an impairment charge is recorded for the amount that the carrying value of the asset group exceeds its fair value. Fair value is estimated as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Property, plant and equipment, net includes the following: December 31 2020 2019 Land and land improvements $ 33.6 $ 31.8 Plant and equipment 842.9 764.0 Property, plant and equipment, at cost 876.5 795.8 Allowances for depreciation and amortization ( 536.1 ) ( 487.3 ) $ 340.4 $ 308.5 Total depreciation and amortization expense on property, plant and equipment was $ 36.8 million, $ 36.7 million and $ 37.4 million during 2020, 2019, and 2018, respectively. NOTE 13— Goodwill and Intangible Assets The Company evaluates the carrying amount of goodwill and indefinite-lived intangible assets for impairment annually as of May 1 st and between annual evaluations if changes in circumstances or the occurrence of certain events indicate potential impairment. The Company uses either a qualitative or quantitative analysis to determine whether fair value exceeds carrying value. Goodwill impairment testing for 2020 was performed using a quantitative analysis for each reporting unit. As part of the quantitative testing process for goodwill, the Company estimated fair values using a discounted cash flow approach from the perspective of a market participant. Significant estimates in the discounted cash flow approach are cash flow forecasts of the reporting units, the discount rate, the terminal business value and the projected income tax rate. The cash flow forecasts of the reporting units are based upon management’s long-term view of markets and are the forecasts that are used by senior management and the Board of Directors to evaluate operating performance. The discount rate utilized is management’s estimate of what the market’s weighted average cost of capital is for a company with a similar debt rating and stock volatility, as measured by beta. The projected income tax rates utilized are the statutory tax rates for the countries where each reporting unit operates. The terminal business value is determined by applying a business growth factor to the latest year for which a forecast exists. As part of the goodwill quantitative testing process, the Company evaluates whether there are reasonably likely changes to management’s estimates that would have a material impact on the results of the goodwill impairment testing. The Company completed an interim impairment test as of March 31, 2020 and the annual testing of impairment of goodwill as of May 1, 2020 at the reporting unit level for the related goodwill. The fair value of each reporting unit was in excess of its carrying value and thus, no impairment exists. The indefinite-lived intangible assets are the Bolzoni trademarks. Fair values used in testing for potential impairment of the trademarks are calculated by applying an estimated market value royalty rate to the forecasted revenues of the businesses that utilize those assets. The assumed cash flows from this calculation are discounted using Bolzoni’s weighted average cost of capital. The Company completed an interim impairment test as of March 31, 2020 and the annual testing of impairment as of May 1, 2020. The fair value of the indefinite-lived intangible assets was in excess of its carrying value and thus, no impairment exists. The following table summarizes intangible assets, other than goodwill, recorded in the consolidated balance sheets: December 31, 2020 Gross Carrying Amount Accumulated Amortization Net Balance Intangible assets not subject to amortization Trademarks $ 18.4 $ — $ 18.4 Intangible assets subject to amortization Customer and contractual relationships 41.5 ( 17.8 ) 23.7 Patents and technology 22.3 ( 10.4 ) 11.9 Trademarks 5.6 ( 1.1 ) 4.5 Total $ 87.8 $ ( 29.3 ) $ 58.5 F-31 Table of Contents December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Balance Intangible assets not subject to amortization Trademarks $ 16.9 $ — $ 16.9 Intangible assets subject to amortization Customer and contractual relationships 38.9 ( 13.5 ) 25.4 Patents and technology 20.6 ( 7.3 ) 13.3 Trademarks 5.3 ( 0.8 ) 4.5 Total $ 81.7 $ ( 21.6 ) $ 60.1 Amortization expense for intangible assets, which is recognized on a straight-line basis over the estimated useful life of the related asset, was $ 6.1 million and $ 6.6 million in 2020 and 2019, respectively. Expected annual amortization expense of other intangible assets, based upon December 31, 2020 U.S. dollar values, for the next five years is as follows: $ 5.1 million in 2021, $ 4.6 million in 2022, $ 4.5 million in 2023, $ 4.5 million in 2024 and $ 4.1 million in 2025. The weighted-average amortization period for intangible assets is as follows: Intangible assets subject to amortization Weighted-Average Useful Lives (Years) Customer relationships 12 Engineering drawings 6 Patents 5 Trademarks 16 The following table summarizes goodwill by segment as of December 31, 2020 and 2019: Carrying Amount of Goodwill Americas EMEA JAPIC Bolzoni Total Balance at January 1, 2019 $ 1.7 $ 1.1 $ 51.5 $ 54.0 $ 108.3 Foreign currency translation — ( 0.1 ) ( 0.6 ) ( 0.9 ) ( 1.6 ) Balance at December 31, 2019 $ 1.7 $ 1.0 $ 50.9 $ 53.1 $ 106.7 Foreign currency translation — 0.1 3.3 4.6 8.0 Balance at December 31, 2020 $ 1.7 $ 1.1 $ 54.2 $ 57.7 $ 114.7 NOTE 14— Current and Long-Term Financing The following table summarizes available and outstanding borrowings: December 31 2020 2019 Total outstanding borrowings: Revolving credit agreements $ 0.7 $ 7.7 Term loan, net 163.1 172.2 Other debt 96.7 86.1 Finance lease obligations 28.7 21.0 Total debt outstanding $ 289.2 $ 287.0 Plus: discount on term loan and unamortized deferred financing fees 1.9 2.8 Total debt outstanding, gross $ 291.1 $ 289.8 Current portion of borrowings outstanding $ 83.1 $ 82.3 Long-term portion of borrowings outstanding $ 206.1 $ 204.7 Total available borrowings, net of limitations, under revolving credit agreements $ 267.1 $ 260.6 Unused revolving credit agreements $ 266.4 $ 252.9 Weighted average stated interest rate on total borrowings 3.4 % 4.6 % Weighted average effective interest rate on total borrowings (including interest rate swap agreements) 2.4 % 3.6 % F-32 Table of Contents Annual maturities of total debt, excluding finance leases, are as follows: 2021 $ 76.4 2022 17.8 2023 152.8 2024 12.9 2025 2.5 Thereafter — $ 262.4 Interest paid on total debt was $ 13.0 million, $ 19.5 million and $ 15.0 million during 2020, 2019 and 2018, respectively. The Company has a $ 240.0 million secured, floating-rate revolving credit facility (the "Facility") that expires in April 2022. There were no borrowings outstanding under the Facility at December 31, 2020. The availability under the Facility, at December 31, 2020, was $ 234.3 million, which reflects reductions of $ 5.7 million for letters of credit and other restrictions. As of December 31, 2020, the Facility consisted of a U.S. revolving credit facility of $150.0 million and a non-U.S. revolving credit facility of $90.0 million. The obligations under the Facility are generally secured by a first lien on the working capital assets of the borrowers in the Facility, which include but are not limited to, cash and cash equivalents, accounts receivable and inventory (the "Facility Collateral") and a second lien on the Term Loan Collateral (defined below). The approximate book value of assets held as collateral under the Facility was $ 900 million as of December 31, 2020. Borrowings bear interest at a floating rate based on a base rate or LIBOR, as defined in the Facility, plus an applicable margin. The applicable margins, as of December 31, 2020, for U.S. base rate loans and LIBOR loans were 0.25 % and 1.25 %, respectively. The applicable margin, as of December 31, 2020, for non-U.S. base rate loans and LIBOR loans was 1.25 %. The Facility also required the payment of a fee of 0.250 % per annum on the unused commitment as of December 31, 2020. The Facility includes restrictive covenants, which, among other things, limit additional borrowings and investments of the Company and its subsidiaries subject to certain thresholds, as set forth in the Facility, and limits the payment of dividends. If average availability for both total and U.S. revolving credit facilities, on a pro forma basis, is greater than 15% and less than or equal to 20%, the Company may pay dividends subject to achieving a minimum Fixed Charge Coverage Ratio of 1.00 to 1.00, as defined in the Facility. If the average availability is greater than 20% for both total and U.S. revolving credit facilities, on a pro forma basis, the Company may pay dividends without any minimum Fixed Charge Coverage Ratio requirement. The Facility also requires the Company to achieve a minimum Fixed Charge Coverage Ratio in certain circumstances in which total excess availability is less than 10% of the total commitments under the Facility or excess availability under the U.S. revolving credit facility is less than 10% of the U.S. revolver commitments, as defined in the Facility. At December 31, 2020, the Company was in compliance with the covenants in the Facility. The Company also has a $ 200.0 million term loan (the "Term Loan"), which matures in May 2023. The Term Loan requires quarterly principal payments on the last business day of each March, June, September and December in an amount equal to $2.5 million. The final principal repayment is due on May 30, 2023. The Company may also be required to make mandatory prepayments, in certain circumstances, as provided in the Term Loan. At December 31, 2020, there was $ 165.0 million of principal outstanding under the Term Loan which has been reduced in the Consolidated Balance Sheet by $ 1.9 million of discounts and unamortized deferred financing fees. The obligations under the Term Loan are generally secured by a first priority lien on the present and future shares of capital stock, material real property, fixtures and general intangibles consisting of intellectual property (collectively, the "Term Loan Collateral") and a second priority lien on the Facility Collateral. The approximate book value of assets held as collateral under the Term Loan was $ 600 million as of December 31, 2020. Borrowings under the Term Loan bear interest at a floating rate, which can be a base rate or Eurodollar rate, as defined in the Term Loan, plus an applicable margin. The applicable margin, as provided in the Term Loan, is 2.25 % for U.S. base rate loans and 3.25 % for Eurodollar loans. The interest rate on the amount outstanding under the Term Loan at December 31, 2020 was 3.40 %. In addition, the Term Loan includes restrictive covenants, which, among other things, limit additional borrowings and investments of the Company subject to certain thresholds, as provided in the Term Loan. The Term Loan limits the payment of regularly scheduled dividends and other restricted payments to $50.0 million in any fiscal year, unless the consolidated total net leverage ratio, as defined in the Term Loan, does not exceed 1.75 to 1.00 at the time of the payment. At December 31, 2020, the Company was in compliance with the covenants in the Term Loan. F-33 Table of Contents The Company incurred fees of $ 0.4 million and $ 0.6 million in 2019 and 2018, respectively. No fees were incurred in 2020. These fees related to amending the Facility and the Term Loan. These fees were deferred and are being amortized as interest expense over the term of the applicable debt agreements. Fees related to the Term Loan are presented as a direct deduction of the corresponding debt. The Company had other debt outstanding, excluding finance leases, of approximately $ 97.4 million at December 31, 2020. In addition to the excess availability under the Facility of $ 234.3 million, the Company had remaining availability of $ 32.1 million related to other non-U.S. revolving credit agreements. NOTE 15— Leasing Arrangements The Company determines if an arrangement contains a lease and the classification of that lease, if applicable, at inception. The Company has elected to not recognize a lease liability or right-of-use ("ROU") asset for short-term leases (leases with an initial term of twelve months or less). For contracts with lease and non-lease components, the Company has elected not to allocate the contract consideration, and to account for the lease and non-lease components as a single lease component. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments under the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The implicit rate within the operating leases are generally not determinable and the Company has obtained rates from third-party financiers for relevant geographies, currencies and lease terms to determine the incremental borrowing rate at the date of adoption of the new lease standard and at the inception of new leases. The operating lease ROU asset also includes any lease prepayments, offset by lease incentives. Certain of the Company's leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain the Company will exercise that option. An option to terminate is also considered in connection with determining the ROU asset and lease liability unless it is reasonably certain the Company will not exercise the option. Lease expense for operating lease payments is recognized on a straight-line basis over the term of the lease. As of December 31, 2020 and 2019, the Company had the following amounts recorded on the Company's unaudited condensed consolidated balance sheet: Location on Balance Sheet December 31, 2020 December 31, 2019 Assets Operating lease assets Other non-current assets $ 71.3 $ 76.3 Finance lease assets Property, plant and equipment, net 37.5 26.3 Total $ 108.8 $ 102.6 Liabilities Current Operating lease liabilities Other current liabilities 17.6 18.0 Finance lease liabilities Current maturities of long-term debt 7.5 8.5 Long-term Operating lease liabilities Other long-term liabilities 57.7 62.3 Finance lease liabilities Long-term debt 21.2 12.5 Total $ 104.0 $ 101.3 Finance lease assets are recorded net of accumulated amortization of $ 18.4 million and $13.5 million as of December 31, 2020 and 2019, respectively. Amortization of plant and equipment under finance leases is included in depreciation expense. Finance lease obligations of $ 17.0 million, $ 7.9 million and $ 4.7 million were incurred in connection with lease agreements to acquire machinery and equipment during 2020, 2019 and 2018, respectively. In addition, leases with HYGFS included in the unaudited condensed consolidated balance sheet at December 31, 2020 and 2019, include $ 17.8 million and $ 17.7 million of ROU assets and $ 17.9 million and $ 17.8 million of lease liabilities. F-34 Table of Contents As of December 31, 2020, the Company had the following remaining lease term and weighted average discount rates: Operating Leases Finance Leases Weighted-average remaining lease term in years 6.68 2.92 Weighted-average discount rate 5.00 % 3.92 % For the December 31, 2020, the Company recorded the following amounts: Year Ended Year Ended Location on Income Statement December 31, 2020 December 31, 2019 Operating lease cost Cost of sales $ 9.3 $ 8.6 Operating lease cost Selling, general and administrative expenses 16.1 16.3 Finance lease cost Amortization of leased assets Cost of sales 3.8 7.8 Interest on lease liabilities Interest expense 0.3 0.6 Sublease income Revenues ( 8.6 ) ( 11.5 ) Total $ 20.9 $ 21.8 The Company recognizes sublease income primarily related to lift trucks in which the Company records revenues over the term of the lease in accordance with the rental agreements with its customers. Aggregate future minimum rentals to be received under noncancellable subleases of lift trucks as of December 31, 2020 were $ 32.2 million. For the year ended December 31, 2020, the Company recorded the following amounts: Year Ended Year Ended December 31, 2020 December 31, 2019 Cash paid for lease liabilities Operating cash flows from operating leases $ 22.8 $ 24.2 Operating cash flows from finance leases 0.3 0.6 Financing cash flows from finance leases 4.0 7.9 Non-cash amounts related to right-of-use assets obtained in exchange for lease obligations Operating 16.2 18.3 Finance 3.0 4.4 Annual maturities of lease liabilities are as follows: Operating Leases Finance Leases Total 2021 $ 20.5 $ 10.0 $ 30.5 2022 17.1 6.9 24.0 2023 13.1 5.5 18.6 2024 9.6 3.7 13.3 2025 6.4 2.8 9.2 Thereafter 22.4 — 22.4 89.1 28.9 118.0 Less: Interest ( 13.8 ) ( 0.2 ) ( 14.0 ) Net $ 75.3 $ 28.7 $ 104.0 The Company leases certain office, manufacturing and warehouse facilities and machinery and equipment under noncancellable finance and operating leases that expire at various dates through 2037. Many leases include renewal and/or fair value purchase options. F-35 Table of Contents NOTE 16— Product Warranties The Company provides a standard warranty on its lift trucks, generally for six to twelve months or 1,000 to 2,000 hours . For certain series of lift trucks, the Company provides a standard warranty of one to two years or 2,000 or 4,000 hours . For components in some series of lift trucks, the Company provides a standard warranty of two to three years or 4,000 to 6,000 hours . The Company estimates the costs which may be incurred under its standard warranty programs and records a liability for such costs at the time product revenue is recognized. In addition, the Company sells separately priced extended warranty agreements that generally provide a warranty for an additional two to five years or up to 2,400 to 10,000 hours . The specific terms and conditions of those warranties vary depending upon the product sold and the country in which the Company does business. Revenue received for the sale of extended warranty contracts is deferred and recognized in the same manner as the costs incurred to perform under the warranty contracts. The Company also maintains a quality enhancement program under which it provides for specifically identified field product improvements in its warranty obligation. Accruals under this program are determined based on estimates of the potential number of claims and the cost of those claims based on historical costs. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Factors that affect the warranty liability include the number of units sold, historical and anticipated rates of warranty claims and the cost per claim. Changes in the Company's current and long-term warranty obligations, including deferred revenue on extended warranty contracts, are as follows: 2020 2019 Balance at January 1 $ 65.2 $ 56.9 Current year warranty expense 25.4 42.1 Change in estimate related to pre-existing warranties 5.3 2.5 Payments made ( 32.3 ) ( 36.1 ) Foreign currency effect 1.1 ( 0.2 ) Balance at December 31 $ 64.7 $ 65.2 NOTE 17— Contingencies Various legal and regulatory proceedings and claims have been or may be asserted against the Company relating to the conduct of its businesses, including product liability, environmental and other claims. These proceedings and claims are incidental to the ordinary course of business. Management believes that it has meritorious defenses and will vigorously defend the Company in these actions. Any costs that management estimates will be paid as a result of these claims are accrued when the liability is considered probable and the amount can be reasonably estimated. Although the ultimate disposition of these proceedings is not presently determinable, management believes, after consultation with its legal counsel, that the likelihood is remote that costs will be incurred materially in excess of accruals already recognized. The Company previously filed legal actions in Brazil to recover certain social integration and social contribution taxes paid over gross sales, including ICMS receipts, which is a form of state value added tax. During 2019, the Company’s Brazil legal advisors notified the Company that they received judicial notification that the Superior Judicial Court rendered a favorable decision on the case granting the Company the right to recover, through offset of federal tax liabilities, amounts of overpayments collected by the government from 1999 to date. The judicial court decision is final and not subject to appeals. The current estimate of the refund calculated on a gross basis is approximately 100 million Brazilian reais, or approximately $19 million based on exchange rates as of December 31, 2020. The amount and ultimate timing of realization of these recoveries is dependent upon administrative approvals, generation of federal tax liabilities in Brazil eligible for offset and potential impacts of future legislative actions within Brazil, all of which are uncertain. During 2019, based upon a probability weighted analysis, including a review of historical earnings and trends, forecasted earnings, the relevant expiration of carryforwards and the potential of selling the credits at a significant discount, the Company determined the net realizable value of the credits was approximately 8 million Brazilian reais, or $ 1.5 million based F-36 Table of Contents on exchange rates as of December 31, 2020. Future legislative changes in Brazil, changes in the Company’s forecasted earnings or resolution of other uncertainties could impact the estimate of the amount realizable for these tax credits. The Brazilian tax authorities have sought clarification before the Brazilian Supreme Court of certain matters, including the amount of these credits (i.e., the gross rate or net credit amount), and certain other matters that could affect the rights of Brazilian taxpayers regarding these credits, all of which would materially impact the realization of the credits. Based on the opinions of our tax and legal advisors, we have not accrued any amounts related to potential future litigation regarding these credits. NOTE 18— Guarantees Under various financing arrangements for certain customers, including independent retail dealerships, the Company provides recourse or repurchase obligations such that it would be obligated in the event of default by the customer. Terms of the third-party financing arrangements for which the Company is providing recourse or repurchase obligations generally range from one to five years. Total amounts subject to recourse or repurchase obligations at December 31, 2020 and 2019 were $ 119.7 million and $ 179.7 million, respectively. As of December 31, 2020, losses anticipated under the terms of the recourse or repurchase obligations were not significant and reserves have been provided for such losses based on historical experience in the accompanying consolidated financial statements. The Company generally retains a security interest in the related assets financed such that, in the event the Company would become obligated under the terms of the recourse or repurchase obligations, the Company would take title to the assets financed. The fair value of collateral held at December 31, 2020 was approximately $ 183.3 million based on Company estimates. The Company estimates the fair value of the collateral using information regarding the original sales price, the current age of the equipment and general market conditions that influence the value of both new and used lift trucks. The Company also regularly monitors the external credit ratings of the entities for which it has provided recourse or repurchase obligations. As of December 31, 2020, the Company did not believe there was a significant risk of non-payment or non-performance of the obligations by these entities; however, there can be no assurance that the risk may not increase in the future. In addition, the Company has an agreement with WF to limit its exposure to losses at certain eligible dealers. Under this agreement, losses related to $ 22.3 million of recourse or repurchase obligations for these certain eligible dealers are limited to 7.5 % of their original loan balance, or $ 11.4 million as of December 31, 2020. The $ 22.3 million is included in the $ 119.7 million of total amounts subject to recourse or repurchase obligations at December 31, 2020. Generally, the Company sells lift trucks through its independent dealer network or directly to customers. These dealers and customers may enter into a financing transaction with HYGFS or other unrelated third parties. HYGFS provides debt and lease financing to both dealers and customers. On occasion, the credit quality of a customer or credit concentration issues within WF may require the Company to provide recourse or repurchase obligations of the lift trucks purchased by customers and financed through HYGFS. At December 31, 2020, approximately $ 97.8 million of the Company's total recourse or repurchase obligations of $ 119.7 million related to transactions with HYGFS. In connection with the joint venture agreement, the Company also provides a guarantee to WF for 20 % of HYGFS’ debt with WF, such that the Company would become liable under the terms of HYGFS’ debt agreements with WF in the case of default by HYGFS. At December 31, 2020, loans from WF to HYGFS totaled $ 1.2 billion. Although the Company’s contractual guarantee was $ 239.4 million, the loans by WF to HYGFS are secured by HYGFS’ customer receivables, of which the Company guarantees $ 97.8 million. Excluding the HYGFS receivables guaranteed by the Company from HYGFS’ loans to WF, the Company’s incremental obligation as a result of this guarantee to WF is $ 222.0 million, which is secured by 20% of HYGFS' customer receivables and other secured assets of $ 288.4 million. HYGFS has not defaulted under the terms of this debt financing in the past, and although there can be no assurances, the Company is not aware of any circumstances that would cause HYGFS to default in future periods. The following table includes the exposure amounts related to the Company's guarantees at December 31, 2020: HYGFS Total Total recourse or repurchase obligations $ 97.8 $ 119.7 Less: exposure limited for certain dealers 22.3 22.3 Plus: 7.5% of original loan balance 11.4 11.4 86.9 108.8 Incremental obligation related to guarantee to WF 222.0 222.0 Total exposure related to guarantees $ 308.9 $ 330.8 F-37 Table of Contents NOTE 19—Debt and Equity Investments and Related Party Transactions The Company maintains an interest in one variable interest entity, HYGFS. HYGFS is a joint venture with WF formed primarily for the purpose of providing financial services to independent Hyster ® and Yale ® lift truck dealers and National Account customers in the United States and is included in the Americas segment. The Company does not have a controlling financial interest or have the power to direct the activities that most significantly affect the economic performance of HYGFS. Therefore, the Company has concluded that the Company is not the primary beneficiary and uses the equity method to account for its 20 % interest in HYGFS. The Company does not consider its variable interest in HYGFS to be significant. Generally, the Company sells lift trucks through its independent dealer network or directly to customers. These dealers and customers may enter into a financing transaction with HYGFS or other unrelated third parties. HYGFS provides debt financing to dealers and lease financing to both dealers and customers. HYGFS’ total purchases of Hyster ® and Yale ® lift trucks from dealers, and directly from the Company such that HYGFS could provide retail lease financing to customers for the years ended December 31, 2020, 2019 and 2018 were $ 452.9 million, $ 514.1 million and $ 536.2 million, respectively. Of these amounts, $ 99.6 million, $ 126.4 million and $ 79.5 million for the years ended December 31, 2020, 2019 and 2018, respectively, were invoiced directly from the Company to HYGFS so that the customer could obtain operating lease financing from HYGFS. Amounts receivable from HYGFS were $ 5.7 million and $ 9.0 million at December 31, 2020 and 2019, respectively. At December 31, 2020, the Company had $ 10.0 million of notes payable to HYGFS for advance funding of inventory that will be financed by HYGFS upon sale. The Company provides recourse for certain financing provided by HYGFS to its dealers and customers. In addition, the Company also provides a guarantee to WF for their portion of HYGFS' debt. Refer to Note 18 for additional details relating to the guarantees provided to WF. In addition to providing financing to dealers, HYGFS provides operating lease financing to the Company. Operating lease obligations primarily relate to specific sale-leaseback-sublease transactions for certain customers whereby the Company sells lift trucks to HYGFS, leases these lift trucks back under an operating lease agreement and then subleases those lift trucks to customers under an operating lease agreement. Total obligations to HYGFS under the operating lease agreements were $ 19.9 million and $ 21.2 million at December 31, 2020 and 2019, respectively. In addition, the Company provides certain subsidies to its dealers that are paid directly to HYGFS. Total subsidies were $ 3.1 million, $ 6.0 million and $ 5.0 million for 2020, 2019 and 2018, respectively. The Company provides certain services to HYGFS for which it receives compensation under the terms of the joint venture agreement. The services consist primarily of administrative functions and remarketing services. Total income recorded by the Company related to these services was $ 4.9 million in 2020, $ 7.0 million in 2019 and $ 8.0 million in 2018. The Company has a 50 % ownership interest in SN, a limited liability company that was formed primarily to manufacture and distribute Sumitomo-branded lift trucks in Japan and export Hyster ® - and Yale ® - branded lift trucks and related components and service parts outside of Japan. The Company purchases products from SN under agreed-upon terms. The Company’s ownership in SN is also accounted for using the equity method of accounting and is included in the JAPIC segment. The Company purchases products from SN under normal trade terms based on current market prices. In 2020, 2019 and 2018, purchases from SN were $ 23.9 million, $ 45.5 million and $ 65.4 million, respectively. Amounts payable to SN at December 31, 2020 and 2019 were $ 16.1 million and $ 15.6 million, respectively. The Company recognized income of $ 0.3 million, $ 0.3 million and $ 0.4 million for payments from SN for use of technology developed by the Company which is included in “Revenues” in the Consolidated Statements of Operations for the years ended December 31, 2020, 2019 and 2018, respectively. F-38 Table of Contents Summarized unaudited financial information for equity investments is as follows: 2020 2019 2018 Statement of Operations Revenues $ 389.6 $ 424.3 $ 413.0 Gross profit $ 135.4 $ 127.4 $ 126.9 Income from continuing operations $ 28.2 $ 37.4 $ 36.7 Net income $ 28.2 $ 37.4 $ 36.7 Balance Sheet Current assets $ 138.3 $ 123.7 Non-current assets $ 1,607.5 $ 1,665.2 Current liabilities $ 132.9 $ 133.6 Non-current liabilities $ 1,415.0 $ 1,454.3 The Company's equity investments in unconsolidated affiliates are included in “Investment in Unconsolidated Affiliates” in the Consolidated Balance Sheets as follows: December 31, 2020 December 31, 2019 HYGFS $ 21.4 $ 22.8 SN 44.6 43.9 Bolzoni 0.2 0.3 Dividends received from unconsolidated affiliates for the year ended December 31, are summarized below: 2020 2019 2018 HYGFS $ 6.4 $ 4.1 $ 20.1 SN 0.9 1.0 2.1 $ 7.3 $ 5.1 $ 22.2 The Company had an approximately 19 % ownership interest through common and redeemable preferred shares in a third party, OneH2, Inc. ("OneH2"). The Company's investment was $ 11.9 million and $ 10.6 million as of December 31, 2020 and December 31, 2019, respectively. The Company recorded $ 1.3 million of accrued dividend income related to this investment in both 2020 and 2019. During January 2021, the Company sold its investment in preferred shares of OneH2 for $ 15.7 million, including accrued dividends, and recognized a gain of $ 4.6 million. The Company expects to sell its remaining investment in common shares in the first quarter of 2021. The Company has an equity investment in a third party valued using a quoted market price in an active market, or Level 1 in the fair value hierarchy. The Company's investment as of December 31, 2020 and December 31, 2019 was $ 2.1 million and $ 2.4 million, respectively. Any gain or loss on the investment is included on the line "Other" in the "Other (income) expense" section of the Consolidated Statements of Operations for the years ended December 31, as follows: 2020 2019 2018 Loss on equity investment $ ( 0.5 ) $ ( 1.6 ) $ ( 5.1 ) NOTE 20— Restructuring During 2020, the Company performed an in-depth global review to help establish a more sustainable long-term cost structure. As a result, the Company restructured operations to optimize global commercial operations. The Company recognized a charge of approximately $ 4.4 million during the year ended December 31, 2020. These charges primarily related to severance, which was recorded on the line "Selling, general and administrative expenses" in the Consolidated Statements of Operations. Severance payments incurred are expected to be paid in 2021. In addition to the restructuring charge recorded during 2020, the Company anticipates it will incur subsequent charges, which were not eligible for accrual at December 31, 2020, of approximately $ 1.4 million for additional costs related to the restructuring, which the Company expects to incur during 2021. F-39 Table of Contents Following is the detail of the cash charges incurred by reporting segment: Total charges incurred in 2020 Severance Other cash charges Americas $ 1.0 $ 0.9 $ 0.1 EMEA 2.0 2.0 — JAPIC 1.4 1.4 — $ 4.4 $ 4.3 $ 0.1 In 2019, as part of a plan to expand Bolzoni's capabilities in the United States, Bolzoni's North America attachment manufacturing was moved into HYG's Sulligent, Alabama manufacturing facility. Consequently, effective January 1, 2019, the Sulligent facility became a Bolzoni facility. As a result of this restructuring, Bolzoni recognized charges totaling approximately $ 2.5 million during the year ended December 31, 2019. The Company incurred $ 0.4 million related to severance, which was recorded on the line "Selling, general and administrative expenses," and $ 2.1 million related to plant rearrangement and moving costs, which was recorded in "Cost of sales." Severance payments of $ 0.4 million were made during 2019. Cash payments related to this restructuring plan were completed in 2019. F-40 Table of Contents SCHEDULE II— VALUATION AND QUALIFYING ACCOUNTS HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES YEAR ENDED DECEMBER 31, 2020, 2019 AND 2018 Additions Description Balance at Beginning of Period Charged to Costs and Expenses Charged to Other Accounts — Describe (A) Deductions — Describe Balance at End of Period (In millions) 2020 Reserves deducted from asset accounts: Allowance for doubtful accounts (B) $ 9.7 $ 1.0 $ 0.3 $ 0.6 (C) $ 10.4 2019 Reserves deducted from asset accounts: Allowance for doubtful accounts (B) $ 9.7 $ 1.2 $ ( 1.2 ) $ — (C) $ 9.7 2018 Reserves deducted from asset accounts: Allowance for doubtful accounts (B) $ 8.7 $ 1.9 $ ( 0.9 ) $ — (C) $ 9.7 (A) Foreign currency translation adjustments and other. (B) Includes allowance of receivables classified as long-term of $ 4.6 million, $ 4.1 million and $ 4.3 million in 2020, 2019 and 2018, respectively. (C) Write-offs, net of recoveries. F-41