O N B a L a N

8:03:02 PM 8:03:02 PM 3/17/103/17/10 Inc. Company, The Manitowoc 2009 Annual Report NCE ALA B ON Manitowoc’s New 31000 Crane Lift Crawler Heavy

The Manitowoc Company, Inc. 2009 Annual Report

Inc. NCE serving up consistent WI 54221-0066 The develop- and cleanliness. A 66 Box and flavorings, while meeting the and texture flavor for speed, high standards customer’s simplicity, will technology ment of this innovative incremental help our customer generate adding this new and profits by revenue offering to its menu. beverage Company, The Manitowoc 44th South Street 2400 P.O. Manitowoc,

AL fruit, yogurt, N B Foodservice Manitowoc Three brands and their engineering expertise shared of Lean Six Sigma processes knowledge Blended Ice the new Multiplex to create time- to meet the accelerated Machine table of a major quick-service customer. this custom product to engineered We blend of ice, a healthy create Manitowoc’s Multiplex Blended Ice Machine O MN001 2009_Cover 1MN001 2009_Cover 1 Financial Highlights Investor Information Manitowoc took decisive actions to reduce costs The Annual Meeting and produce signiﬁ cant of Shareholders will savings in 2009. be held May 4, 2010, in Manitowoc.

Numbers in millions except share data, number of employees, number of shareholders, and shares outstanding For the Years Ended December 31 For the Year 2009 2008 % Change Net sales $3,782.6 $4,503.0 -16.0% Operating earnings from continuing operations $ (511.2) $ 519.8 -198.3% EBITDA (Credit Agreement Defi nition) $ 383.2 $ 841.6 -54.5% Corporate Headquarters Stock Listing & Related Information CEO Certifi cation to the New York Dividend Reinvestment & Stock Number of employees (approximate) 13,100 18,400 -28.8% The Manitowoc Company, Inc. Manitowoc’s common stock is traded Stock Exchange Purchase Plan During 2009, the chief executive Computershare sponsors and Number of shareholders 3,470 2,512 38.1% 2400 South 44th Street on the New York Stock Exchange and is P.O. Box 66 identifi ed by the ticker symbol MTW. offi cer of the company made timely administers a Dividend Reinvestment Manitowoc, WI 54221-0066 Quarterly common stock price submissions to the New York Stock and Stock Purchase Plan for The Financial Position EVA $ (139.2) $ 231.1 -160.2% Telephone: 920-684-4410 information for our three most recent Exchange of the CEO certifi cation Manitowoc Company’s common stock. Total assets $4,278.7 $6,086.1 -29.7% Telefax: 920-652-9778 fi scal years can be found on page 17 required by Section 12(a) of the NYSE Under this plan, shareholders may also corporate governance listing standards. purchase shares by investing cash, Independent Registered Public of our Form 10-K, which is part of this Debt to capitalization 78.2% 66.8% — The certifi cation was not qualifi ed in any as often as once a month, in varying Accounting Firm annual report. Shares of Manitowoc’s Total equity $ 607.2 $1,322.3 -54.1% way. Additionally, the company’s principal amounts from $10 up to a maximum PricewaterhouseCoopers LLP common stock have been publicly traded executive offi cer and principal fi nancial of $120,000 each calendar year. Average shares outstanding (diluted) 130,268,670 131,630,215 -1.0% 100 East Wisconsin Avenue since 1971. offi cer have made timely submissions Participation is voluntary. Suite 1800 Manitowoc Shareholders of the certifi cations required by Section To receive an information booklet Milwaukee, WI 53202 On December 31, 2009, there were Diluted Earnings per Share Earnings from continuing operations $ (4.94) $ 0.76 302 of the Sarbanes-Oxley Act as and enrollment form, please contact our 130,708,124 shares of Manitowoc Stock Transfer Agent exhibits to the company’s annual report stock transfer agent, Computershare. Earnings (loss) from discontinued operations, net of income taxes $ (0.28) $ (1.09) common stock outstanding and 3,470 Computershare Trust Company, N.A. on Form 10-K. Gain (loss) on sale or closure of discontinued operations, net of income taxes $ (0.19) $ 0.40 shareholders of record. Investor Inquiries First Class, Registered & Certifi ed Mail: Corporate Governance Guidelines, Security analysts, portfolio managers, Net earnings $ (5.41) $ 0.08 Form 10-K Report P.O. Box 43078 Code of Conduct & Code of Ethics individual investors, and media pro- Each year, Manitowoc fi les its Annual Providence, RI 02940-5068 The Manitowoc Company’s corporate fessionals seeking information about Report on Form 10-K with the Securities Diluted Earnings (Loss) per Share Diluted earnings (loss) per share $ (5.41) $ 0.08 governance guidelines, committee Manitowoc are encouraged to visit Overnight or Other Delivery: and Exchange Commission. Most of the Before Special Items tax: charters, code of conduct, and code of our Web site, or contact the following Special items, net of 250 Royall Street fi nancial information contained in that ethics are posted in the investor relations individuals: Goodwill impairment $ 4.21 — Canton, MA 02021-1011 report is included in this Annual Report section of our Web site: to Shareholders. Analysts & Portfolio Managers: Intangible asset impairment $ 0.76 — Telephone: www.manitowoc.com. A copy of Form 10-K, as fi led with the Carl J. Laurino Loss on purchase price hedges — $ 1.87 1-877-498-8861 This information may also be obtained Securities and Exchange Commission Senior Vice President 1-800-952-9245 by any shareholder, without charge, upon Loss on sale of product lines $ 0.06 — for 2009, may be obtained by any & Chief Financial Offi cer (Hearing impaired in U.S.) written request to: Restructuring expense $ 0.20 $ 0.10 shareholder, without charge, upon Telephone: 920-652-1720 1-781-575-4592 Maurice D. Jones written request to: Telefax: 920-652-9775 Loss on debt extinguishment $ 0.05 $ 0.02 (Hearing impaired outside U.S.) Senior Vice President, Steven C. Khail Loss (earnings) from discontinued operations $ 0.24 $ (0.64) General Counsel & Secretary Media Inquiries: Web site: Director of Investor Relations The Manitowoc Company, Inc. Steven C. Khail Goodwill impairment of discontinued operations $ 0.22 $ 1.33 www.computershare.com/investor & Corporate Communications P.O. Box 66 Director of Investor Relations Other $ 0.03 $ 0.04 The Manitowoc Company, Inc. Annual Meeting Manitowoc, WI 54221-0066 & Corporate Communications Diluted earnings (loss) per share before special items $ 0.36 $ 2.80 The annual meeting of The Manitowoc P.O. Box 66 Telephone: 920-652-1713 Dividends Company shareholders will be held Manitowoc, WI 54221-0066 Telefax: 920-652-9775 at 9:00 a.m., CDT, Tuesday, May 4, Manitowoc has paid continuous Other Information Net cash provided by operating activities $ 338.6 $ 309.0 9.6% 2010, at the Holiday Inn, 4601 Calumet dividends, without interruption, since General Inquiries: Property, plant and equipment, net $ 673.7 $ 728.8 -7.6% Avenue, Manitowoc, WI 54220. 1971. The amount and timing of any Joan E. Risch Shareholder Relations Capital expenditures $ 72.5 $ 150.3 -51.8% We encourage our shareholders to dividend will be determined by the Board of Directors. Telephone: 920-652-1731 Depreciation $ 91.6 $ 80.2 14.2% participate in this meeting either in person or by proxy. Telefax: 920-652-9775 Amortization of intangible assets $ 39.5 $ 11.6 240.5% Join MTW on the Internet Dividends paid $ 10.5 $ 10.4 1.0% Manitowoc provides a variety of Net debt increase/(reduction) $ (474.5) $ 2,020.9 -123.5% information about its businesses, products, and markets at: www.manitowoc.com. Equal Opportunity Manitowoc believes that a diverse workforce is required to compete Net Sales successfully in today’s global Manitowoc’s annual report was printed by an Manitowoc’s annual report was printed using Manitowoc’s annual report was printed on ($ Millions) marketplace. The company provides FSC certifi ed printer, supporting responsible Certifi ed 100% Renewal Energy. 10% recycled and recyclable paper using equal employment opportunities in its Despite the impact of a global reces- management of the world’s forests. vegetable-based ink. $5,000 Cert. no. SW-COC-001613 global operations without regard to race, sion, Manitowoc generated net sales color, national origin, sex, age, religion, $4,000 of nearly $3.8 billion—the second disability, sexual orientation, or gender $4,503 *Total Environmental Savings Impact based Net Energy Saved – 7 million BTUs, equivalent Wastewater Saved – 10,366 gallons not used $3,000 highest revenue level in its 107-year on national averages of similar paper without to the energy used by 3 homes/year identity. $3,783 $3,684 history. 10% post consumer waste. Solid Waste – 629 pounds, equivalent to 1 city $2,000 Greenhouse Gases Not Emitted – 2,152 pounds garbage truck $2,651 Wood Use Saved – 3 tons or 23 fewer trees of CO2

$1,000 $2,028 used $1,626

04 05 06 07 08 09 * Environmental impact estimates were made using the Environmental Defense Fund Paper Calculator.

MMN001N001 22009_Cover009_Cover 2 33/19/10/19/10 22:31:36:31:36 AAMM Strategic Balance

Manitowoc balances its seven strategic imperatives to respond to market conditions.

Z Inspired Innovation Competitive Advantage Manitowoc’s Model 31000 is the The newly integrated Manitowoc largest crane it has ever built. Provid- Foodservice segment is strongly ing a maximum capacity of 2,535 positioned to capture additional U.S. tons, the 31000 features a vari- market share across a wide range able position counterweight system, of end markets and geographies. is mounted on four oscillating crawl- Innovation Customer (Pages 6 & 7) ers, and can erect over 720' of boom Continuous Focus and jib. Similarly, three Manitowoc development Fully integrated Foodservice brands worked in of new and in- global company collaboration to develop a blended novative products, that is a flexible Responsible Action ice machine concept for a major processes, and business partner. quick-service customer. services. Manitowoc provided nearly (Front Cover/Back Cover) 135,000 hours of employee training in 2009, including programs in Six Sigma, Lean Manufacturing, Letter to Growth People and project management, Shareholders Global market Organizational and safety. Chairman, President leadership in Development (Page 8) and CEO Glen Tellock the Crane and Attract, engage, and explains how Mani- Foodservice develop top talent towoc enhanced its businesses. to advance global Manitowoc’s strategies. position to pursue seven strategic future growth. imperatives (Pages 2 & 3)

On Balance Financial Discipline A more balanced business mix Senior Vice President and CFO will reduce earnings cyclicality Carl Laurino discusses how over the long term. Excellence Manitowoc met its aggressive (Pages 2 & 3) in Operations Value Creation debt reduction target in a diffi cult Drive world-class Generate consistent operating environment. Operational Excellence performance in improvement in (Page 9) Manitowoc’s Crane segment our manufactur- Economic Value- lowered its cost base by ing and business Added. reducing working capital, practices. Aftermarket cutting inventory, and stream- Services lining manufacturing. Deliver superior (Pages 4 & 5) value through world-class after- Service and Support market service Manitowoc’s new, high-effi ciency and support. Cash Flow From Operations parts distribution facility stocks Signifi cant reductions in work- more than 70,000 parts, pro- ing capital helped Manitowoc vides 24/7 on-call service, and is generate strong cash fl ow staffed and equipped to process from operations. over 600 shipments per day. (Page 9) (Pages 4 & 5)

Transformational Changes 2007 2009 Foodservice 11% Since 2007, Manitowoc transformed itself by divesting its legacy Marine Cranes Cranes 83% 60% business and acquiring one of the world’s leading foodservice equip- Foodservice ment manufacturers. As a result, 40% Manitowoc now operates two globally diverse business segments that Marine 6% provide a balanced approach to creating shareholder value.

MN001 2009_Narrative 1 3/19/10 1:43 PM Letter to Shareholders

Manitowoc’s restruc- tured portfolio of two industry-leading global businesses generated the solid cash ﬂ ow required to reduce debt and invest in our future.

Fellow Shareholders: the Crane and Foodservice seg- restaurant segment to focus Positioned for Growth Historians will likely remember 2009 ments contributed $145 million and on renovation/remodeling and Our management team has encoun- as one of the most challenging busi- $174 million of operating profi t, menu enhancements rather tered tough business cycles before. ness environments in modern times. respectively. We paid down $474 than expansion. We understand how to balance Unlike previous down cycles, the million of debt—and $770 million Nevertheless, we managed short-term strategies for cost con- current recession has not just af- since our $2.7-billion foodservice through this year of enormous tainment and cash generation with fected developed markets in Europe acquisition was funded in November economic challenge. Following long-term initiatives that sustain and North America, but has also 2008. Plus, by amending our bank our record performance in 2008, competitive advantages, strengthen stunted economic growth in portions credit agreement, we created a • we generated net sales of $3.8 customer relationships, and build of the Middle East and Asia Pacifi c more comfortable cushion to meet billion, with $2.3 billion from the platforms for growth. Each year, regions. As a global business, Mani- our fi nancial covenants going for- Crane segment and $1.5 billion we balance our seven key strategic towoc experienced the abruptness ward. As a result, Manitowoc enters from the Foodservice segment; imperatives to adapt to market con- and magnitude of the downturn and 2010 with a stronger balance sheet, • we recorded adjusted operating ditions. During the current cycle, we we were compelled to act quickly, a more effi cient global network, earnings from continuing operations, are continuing to invest in initiatives decisively, and creatively to optimize and an enhanced position to pursue net of goodwill and other one-time that will strengthen our competitive cash fl ow and adapt to the chang- future growth opportunities as the charges, of $232.0 million; and position. We will continue to invest ing marketplace. But on balance, global construction and foodservice • we produced $362.7 million in in people to maintain the best and Manitowoc had a respectable and industries gradually rebound. cash from operations. most experienced workforce in the even surprising year. We made I attribute this performance to crane and foodservice industries. measurable progress against three Balanced Performance our disciplined EVA culture and the We will expand our geographic foot- key operating objectives: creating Even with a more balanced earn- willingness of Manitowoc employees print to take advantage of opportuni- an integrated Foodservice business, ings stream, it’s tough to grow the around the world to rally around our ties in emerging markets. We will taking the actions to emerge as an top and bottom lines when both key metric of debt reduction. The continue to invest in our industry- even stronger global competitor in business segments face down mar- quick and decisive actions we took leading brands by emphasizing our Crane business, and intently kets. The weakness of the worldwide helped drive a signifi cant reduction product innovation, because strong focusing on cash generation. Our construction industry, combined in SG&A and produce annual run- brands resonate during tough times. performance also validated—much with a global credit freeze, prompted rate savings of $365 million. And, we will build on our industry sooner than we expected—our order cancellations that reduced our We expect to make additional leadership in customer service and strategy to build out our Foodser- Crane backlog to $573 million at progress in 2010 to realize $80 product support. vice platform. We benefi ted from a year-end and drove year-over-year million in total synergies from our balanced portfolio of two market- Crane revenues down 41%. On top foodservice acquisition by 2011, leading global businesses, in which of that, the U.S. restaurant industry and to ramp up lean manufacturing revenues fell for an unprecedented projects in both businesses to im- second consecutive year. That prove effi ciency and environmental prompted many operators in the performance.

Glen E. Tellock Chairman, President & Chief Executive Officer

Glen Tellock leads an experienced management team that is expanding Manitowoc’s global platform, bringing customers innovative new products, and improving operational efﬁ ciency and customer satisfaction.

MN001 2009_Narrative 2 3/19/10 1:59 PM Operating Earnings From Continuing Operations ($ Millions)

$600 Despite the ongoing impact of the global recession, which affected virtu- $480 ally all of Manitowoc’s customers and

$519.8 end markets, the company generated $360 $475.8 $188.8 million in operating earnings

$240 $159.0 from continuing operations in 2009.

$120 $66.4 $24.8 * Excludes goodwill and intangible asset impairment $188.8* 04 05 06 07 08 09 charges.

Manitowoc Foodservice is build- Manitowoc Cranes confronted I am proud of the focus, com- It’s hard to imagine a sterner test ing an integrated global business especially adverse conditions in mitment, and resilience Manitowoc for Manitowoc, our employees, and with market-leading brands and 2009, and it demonstrated strength displayed in 2009. Our Foodservice our shareholders than the one we competitive advantages across all and tenacity by taking the tough team pursued integration with just completed. We clearly demon- product lines. In 2009, the team steps necessary to position itself for urgency and surpassed its targets. strated that our strategy is working. accelerated this process and sur- optimal performance as global eco- We met our adjusted commitment We have much more work ahead, passed its target by 40%, generat- nomic conditions gradually improve. to pay down debt—a signifi cant and 2010 will require sharp focus. ing $34 million in synergies. In just When crane demand fell sharply in accomplishment given the economic This discipline will leave us even one year, it completed the hard work North America and Europe, we im- headwinds we faced. Across the better positioned to generate strong necessary to rationalize operations, mediately streamlined global opera- company, our people stayed focused returns for shareholders in the years create an integrated sales team tions by rationalizing workforces and on operational excellence, product ahead—just as we have in the past. and support network, optimize its consolidating operations. We forti- innovation, and aftermarket sup- Thank you for believing in us, and supply chain, and improve safety fi ed market positions in China, India, port to build a stronger and leaner we look forward to rewarding your performance. Taken together, these Australia, and Brazil by expanding organization. And, we demonstrated confi dence. efforts drove up operating margins product lines and facilities to benefi t our value to customers by helping to 11.8%. from the most resilient economies them overcome their operational As the emerging industry leader in all three operating regions. For challenges. in both “hot” and “cold” equipment, example, our joint venture in China This progress would not have Glen E. Tellock Manitowoc Foodservice is collabo- is now meeting demand for locally been possible without the support Chairman, President & rating with many of the industry’s manufactured truck cranes used to and perseverance of our 13,100 Chief Executive Officer fastest growing and most innovative support construction projects and employees worldwide. They adhered organizations and is rolling out new infrastructure expansion. The Crane to our core values of integrity, com- products to support its growth. segment also continued to invest in mitment to shareholders, and pas- Both sides of the business also manufacturing quality and customer sion for excellence during the most continue to earn industry best-in- support, turning feedback from diffi cult economic time they have class awards in many product lines. dealers and customers into new ini- ever endured. Their continued focus With this strong momentum, and an tiatives. By the second half of 2009, on internal processes will make anticipated return to industry-wide its backlog began to stabilize and Manitowoc an even stronger com- growth in the back half of 2010, order fl ow began to track positively. pany—one even better equipped to Manitowoc Foodservice is ready to deliver value to customers. demonstrate its full potential.

International Shipments Sales per Employee ($ Millions) ($ Thousands) In 2009, Manitowoc generated 51% Manitowoc’s commitment to of its revenues outside of the United operational excellence through the States. This level of global perfor- implementation of Lean Manufacturing mance was driven by the success of and Six Sigma methodologies enabled acquisitions, building our products the company to boost its sales per closer to their intended end markets, employee by 18% in 2009. and continued strength in multiple emerging market economies.

$3,000 $400

$2,400 $320 $350.9 $2,606 $1,800 $240 $288.7 $281.8 $279.0 $2,057 $1,920 $1,200 $160 $242.8 $244.7 $1,398 $1,076 $ 600 $863 $ 80

04 05 06 07 08 09 04 05 06 07 08 09

MN001 2009_Narrative 3 3/17/10 8:30:10 PM Crane Segment

Manitowoc’s Crane segment DongYue GT25-K is creating the lean, effi cient, quality-focused global manufacturing and service network it needs to emerge as an even stronger competitor as the economy improves. Customers around the world count on our leading brands China is the world’s largest market for mobile hydraulic cranes. To capitalize to deliver the industry’s most on this opportunity, Manitowoc has innovative and advanced lift- formed a joint venture with TaiAn ing solutions, supported by DongYue to build a range of truck cranes in capacities from 10 to 25 the world’s most expansive metric tons at a state-of-the-art support network. facility in Shandong Province.

Grove GCK3045 New for 2009, the Grove GCK3045 is a three-axle, 45-metric ton crane that requires no counterweight, is equipped with asymmetric outriggers, offers a compact three-meter height, and provides up to 46.5 meters of reach, making it ideal for use within factories and other congested industrial locations.

This Grove GTK1100 recently completed two wind turbine projects in Inner Mongolia. When fully deployed, the GTK1100 can lift 95 metric tons at heights to 115 meters.

MN001 2009_Narrative 4 3/17/10 8:30:14 PM In 2009, our Crane segment CRAWLER CRANE New Crane Care Distribution Facility Crane Care first Western crawler crane manu- confronted the severe economic To enhance customer service, Manito- facturer in China. We moved quickly woc Crane Care consolidated its North downturn by focusing on three American parts distribution by opening to access top-tier suppliers, expand operating priorities. Drawing on a new 141,000-square foot facility our distribution network, and lessons from the last down cycle, we in 2009. Strategically located near establish new Crane Care locations moved aggressively to right-size our Louisville, KY, the facility houses spare throughout the region to drive further global operations to reflect current parts for all Manitowoc crane brands differentiation. under one roof, operates on an around- market conditions, improve quality the-clock basis, and stocks more than We are also strongly positioned and customer satisfaction, and 70,000 unique parts numbers. for new opportunities in other leverage our premium brand to emerging markets. In Latin America, build share in developed markets MDT 368 Tower Crane MLC 100 Crawler Crane we now command a strong market and seize opportunities in emerging share across all product lines and economies. are well positioned to serve the region’s growing infrastructure Right-sizing Global Operations needs. In Saudi Arabia, 130 cranes As the year progressed, we saw new representing all our lines are work- orders for tower cranes in Europe ing together to build a new university and crawler cranes in the U.S. where women can receive a quality decline like never before. Facing a education. 40% contraction in top-line sales, Available in 12 and 16-ton capacities, Designed and manufactured in China we reduced our workforce and cut Potain’s MDT 368 is the largest tower for one of the world’s fastest-growing Returning to Growth During the costs and inventory levels to gener- crane in its topless offering. The MDT construction markets, Manitowoc’s fourth quarter of 2009 we began to ate cash and maintain profitability. 368 shown here is one of over 100 MLC 100 is a 100-metric ton capacity see early signs of recovery, as our At the same time, we maintained Potain tower cranes that are working crawler crane that can be rigged with backlog stabilized and order flow around-the-clock to construct the up to 94 meters of boom and jib, yet be our global talent pool by retaining ex- Princess Nourah University in Riyadh, transported on just four trucks. increased. Though we expect slower pertise in key locations and stepped Saudi Arabia. recovery in developed markets, we up our new product development are encouraged by the demand in and aftermarket support. We also Customer Satisfaction Index in the Delivering Local Support Our emerging markets for the larger, examined our existing supplier U.S., we introduced it globally to find close relationships with customers heavier lift cranes used in large base and focused our supply chain out how our products rate at delivery. also helped us increase share in infrastructure projects. These prod- on key materials and contractors. We then employed Lean Six Sigma long-term, high-volume markets ucts generate higher revenues and These initiatives prepared us to processes to boost performance around the world. Crane rental earnings than other lines, and our endure an extended recovery period across all our product lines and operations prefer premium brands— innovative products give us a strong and will enable us to emerge as a plants. As examples, we specified a especially in down cycles—because competitive advantage. stronger competitor as the economy new anti-rust coating for our rough- they deliver higher long-term return As our Crane segment continues improves. terrain cranes, introduced a new flow on investment. Customers also to erect the platform for global manufacturing process at our boom value locally manufactured products, leadership in the lifting industry, we Improving Operational shop that reduced production from because proximity eliminates trans- are guided by the seven strategic Excellence As an industry leader, 50 days to five days, and implement- port costs and enhances customer imperatives that have helped us we depend on our strong brands to ed a just-in-time system for drum relationships. And, emerging markets, build competitive advantages. Our differentiate us with the custom- manufacturing that cut production in particular, place a high value on commitment to product innovation, ers who buy and rent our products. time from 13 weeks to three weeks. aftermarket support. We leveraged customer service, and operational These customers set high standards Together, these and other measures these insights to build on our first- excellence has given us the resil- for quality and tie new orders to this helped us improve our “promoter” to-market advantage as the first ience we need to generate positive benchmark. After piloting our metric and meet accelerated delivery Western manufacturer of tower cash flow, increase our share in schedules. In the process, we cranes in China and India, and the traditional markets, and create lowered our cost base by reducing value for customers in emerging working capital, lowering inventory, markets. and streamlining manufacturing.

Segment Revenue by End Market 2009

Manitowoc’s innovative and diverse Residential Manufacturing line of crawler, tower, and mobile tele- Construction 5% scopic cranes is well suited for global 10% Commercial infrastructure and energy projects. Road & Construction These two end markets, which have Highway 23% been the most resilient during the 16% current recession, represent 62% of Utilities Manitowoc’s Crane segment revenues. 8% Industrial/ Power Petrochemical Plants 17% 21%

MN001 2009_Narrative 5 3/19/10 1:43 PM Foodservice Segment With the industry’s broadest lineup of “hot” and “cold” products, Manito- woc Foodservice delivers high-performance equipment and solutions that help customers around the world improve quality, ef- ﬁ ciency, and productivity.

Convotherm ovens feature new electronic programming controls for cooking modes, a “Crisp and Tasty” de-moisturizing feature, a stored recipe library, and multiple cooking stage programs.

With the Delﬁ eld Versa Drawer™, each of four drawers can operate as a refrigerator, a freezer, a thaw cabinet, or a convenience unit via a simple control unit.

MN001 2009_Narrative 6 3/19/10 2:13:07 AM Manitowoc Foodservice entered Frymaster® Protector® Fryer Manitowoc S-Series Ice Machines • Built on the market success of our 2009 with the singular goal of Kitchenology concept by hosting cus- integrating our “hot” and “cold” tomers at our Education and Technol- businesses so we could take full ad- ogy Center and through outreach vantage of their many synergies. As programs of our High Performance the year progressed, we confronted Kitchen team. the additional challenge of a global restaurant industry that experienced Competitive Advantage Mani- declining sales for an unprecedented towoc Foodservice enters 2010 as second consecutive year. We a globally integrated business with responded by supporting customers the strong “hot” and “cold” brands, as they worked to enhance current advanced technologies, talented operations and introduce new menu people, and efficient operations items. In addition, our integration necessary to build on our leader- team surpassed its $24 million ship positions and increase market target and achieved $34 million share. Our extensive EnerLogic® in synergy earnings. These efforts portfolio is comprised of more than helped us deliver strong results NRA KI Awards: Frymaster® FE&S Best In Class Awards: 1,000 energy and resource efficient ® ® under difficult conditions. In our first Gas Protector Fryer, Garland Cleveland, Delﬁ eld, Frymaster, products—including approximately Xpress Grill® & Lincoln Quest EMS™ full year of combined operation, Lincoln & Manitowoc Ice 500 products that qualify for ENERGY The National Restaurant Association In the annual Foodservice Equipment ® Manitowoc Foodservice generated awarded three Manitowoc brands & Supplies survey, five Manitowoc STAR ratings. It provides a distinct $1.5 billion of revenue, while with Kitchen Innovation awards, which brands received the prestigious advantage at a time when customers operating earnings and margins recognize new products that keep Overall Best in Class Awards for and consumers are placing greater kitchens energy efficient, reduce cook improved substantially. consistently outperforming others in emphasis on lower costs and im- times, achieve consistent quality, and their category. Awards reflect quality, reduce operating costs. operator satisfaction, service support, proved environmental performance. Engineering Success Even as and responsiveness. Standard and promotional financing we focused on integration, we programs through Manitowoc remained committed to advancing Focused on Excellence Rec- sive lifecycle and durability testing Finance help customers replace two additional priorities. First, as ognizing that the new Manitowoc that will drive increased reliability or acquire equipment from all our we managed through our transi- Foodservice business will only go and more favorable pricing. brands. And our expanding global tion, we worked hard to maintain as far as our people take us, we’re • Established a central technology manufacturing and distribution foot- and grow customer relationships by building a high-performance work- team responsible for technologies print will help us access opportuni- developing new ideas to improve force to implement our global growth that span product categories to focus ties in the Asia Pacific region and quality, efficiency, and productivity. strategies. Integration created the on future opportunities. other emerging markets. On the “hot” side, we leveraged opportunity to refocus our entire or- • Integrated our sales team to give Industry surveys point to another expertise across our Convotherm ganization on operational excellence, customers a single point of contact flat year before the global food- and Merrychef brands to accelerate product development, and service that can help them take full advan- service industry returns to improved development of the new easyTouch™ support. To that end, we: tage of our broad “hot” and “cold” revenue levels. Against this back- control panel with MenuConnect™ • Created a new leadership team— product lines. drop, however, we are well-positioned subsystem, now available on composed of the best manage- • Created a variety of new alliances to win market share in both devel- our new line of eikon™ products ment talent from both Foodservice and a joint venture that will enable us oped and emerging markets. For launched early in 2010. In addition, businesses—to leverage best to extend our technology leadership example, our Cleveland, Convotherm, product engineers from Manitowoc practices for safety, efficiency, and accelerate new applications. Delfield, Lincoln, and other brands Ice, Manitowoc Beverage Systems, and productivity. For example, our partnership with all benefited from the United States and Delfield collaborated to develop • Began to audit our portfolio of INDUCS will help us improve overall government’s 2009 School Stimulus the new Multiplex Blended Ice brands to extend Lean Six Sigma heat transfer by integrating induction Program, and a similar program for Machine, a custom solution that practices systematically across the technology into our standard cooking 2010 will support additional invest- will enable a major quick-service entire organization. platforms. ment in K-12 foodservice kitchens. customer to introduce smoothies • Identified best-in-class suppliers This opportunity, and many others, as a healthy new menu item. for components shared by multiple will help drive growth in 2010 and brands, and began to perform exten- beyond.

U.S. Restaurant Food and Drink Sales (Billions of Current Dollars)

$600 According to the National Restaurant Association, restaurant industry

$480 $580.1 sales are forecast to advance 2.5% $360 in 2010 and should equal 4% of the U.S. gross domestic product. $240 $379.0 $119.6 $239.3 $120 $42.8

1970 1980 1990 2000 2010

MN001 2009_Narrative 7 3/19/10 2:28:07 AM Corporate Social Responsibility

The EPA named Manitowoc Foodservice a 2010 ENERGY STAR® Partner of the Year.

Category Content Metrics / Initiatives

Energy/Air Manitowoc’s facilities’ natural gas combustion and electrical energy use account for • 150,996 metric tons of total CO2e just over two-thirds of our greenhouse gas emissions. Energy conservation initiatives emissions in 2009. at our plants include energy efficient lighting, motion sensors, programmable ther- • Approximately 20 plants have mostats and controls, and variable frequency drives. Blowing agents are the majority implemented energy conservation of our refrigerant emissions. A continued focus will be to expand our use of blowing initiatives. agents that have lower or no global warming potential.

Water Manitowoc’s manufacturing processes are not water-intensive, and most water is • 40% reduction in water in 2009 at used in testing of equipment such as dishwashers, for cooling, or for employee use. Hangzhou, China facility. In 2009, our Hangzhou, China, facility installed a water recycling system at an equipment test area. For 2010, water recycling systems are planned at Shady Grove, PA, Cleveland, OH, and TaiAn, China.

Recyclable Materials/Packaging Manitowoc Foodservice uses primarily cardboard, plastic, and pallets for product • Kysor-Goodyear, AZ, eliminated 75–85% (Foodservice Only) packaging. In many instances, 100% of packaging materials are recyclable, and all of pallet consumption for finished Manitowoc packaging contains recycling information. To reduce packaging volume, goods and returned 100% of all empty the company has optimized raw materials, reduced the scrap rate, and implemented IBCs and metal containers to suppliers. recycling programs for scrap and waste generated at our facilities. Many plants also • Viscount-Sheffield, UK, eliminated return packaging for reuse by material suppliers. cardboard from all packaging.

Products Manitowoc Foodservice manufactures more than 1,000 products that comply with either • Approximately 500 Foodservice ENERGY STAR or its own more rigorous EnerLogic® program. Manitowoc is an active products carry the ENERGY STAR member of the U.S. Green Building Council, and its energy and water efficient products rating, and the EPA named Manitowoc help customers achieve LEED certification. Products manufactured and sold in the EU a 2010 ENERGY STAR Partner of the adhere to RoHS regulations for toxic materials and WEEE regulations for recycling. Re- Year. frigeration systems use refrigerants that have low or no potential to be ozone depleting. Development of new and upgraded products will continue this focus on producing energy and water efficient products that employ environmentally friendly materials.

Safety and Beneﬁ ts Manitowoc uses a Safety Management System comprised of 20 elements to drive continu- • In 2009, our Global OSHA Recordable ous safety improvement through risk reduction. The system’s requirements target global Rate improved 31% and our Global best practices and commonly exceed local regulatory requirements. Lost Time Injury Rate improved 35% Health and welfare benefits vary by country. They provide a safety net that may include compared to 2008. medical, drug, dental, vision, life insurance, disability coverage, and a full suite of wellness management programs. For retirement, Manitowoc offers a 401(k) defined contribution program with company matching and a company-funded contribution plan.

Education and Community Manitowoc’s learning and development programs offer a variety of leadership develop- • 134,929 hours of employee training in ment, stand-alone training, and custom training programs available to salaried employ- 2009, for an average of 11.96 hours ees as part of their performance planning process. The company has also developed per employee. organizational success profiles by function and specific skills matrices for certain • 100% of salaried exempt employees global functions. Manitowoc also offers transition services to prepare employees for receive annual ethics training. change initiatives or job searches. • Funded 1,248 hours of volunteer Employees volunteer in a broad range of community programs, participate in local services by employees in 2009. Chambers of Commerce, and provide fund-raising support for local charities. • Contributed $308,421 to communities and local charitable organizations. • Funded $1.4 million of collegiate 8% scholarships for 535 students since 150,996 Metric Tons of Ind 1989. Plants 17% Petrochemic CO2e Emissions

Natural Gas Other Fuel Approximately two-thirds of Manito- Combustion Use woc’s Scope 1 and 2 greenhouse gas 23% 3% emissions were from natural gas combustion and electrical energy use. Revenue by End Market 2009 Refrigerant Electrical Use 30% Consumption on 10% 44%

MN001 2009_Narrative 8 3/19/10 1:43 PM Financial Carl J. Laurino Senior Vice President Review & Chief Financial Ofﬁ cer We have built two global reporting segments to generate revenue and earnings and pay down debt.

Fiscal 2009 was a significant year business synergies, create an in the future. To this end, we opened as order cancellations led to lower for Manitowoc. Faced with weak integrated operating structure to a new, integrated Manitowoc Crane factory absorption. In Foodservice, market conditions in both our Crane drive long-term EVA and EPS, and Care parts distribution center in we achieved the double-digit profit and Foodservice segments, we reposition itself to pursue new Jeffersonville, Indiana, and continued level we projected and continued reached—and surpassed—our re- opportunities in global markets. The to fund Lean Six Sigma initiatives to bring product innovation and vised debt reduction target of $450 new management and corporate and employee development pro- energy-efficient performance to million by $24 million. We have now teams performed exceptionally well, grams. We also responded as key large quick-service and institutional reduced debt by $770 million since identifying more than $80 million foodservice customers teamed with customers. These strengths, plus the funding our $2.7 billion foodservice in synergies. At the same time, we us to develop highly specialized quality of our aftermarket services acquisition in November 2008. We confronted the worst merger and new products. All told, we invested and the value of our Manitowoc plan to reduce debt by an additional acquisition market in years as we $72 million to build the foundation Finance program, helped us deliver $200 million in 2010. executed the required divestiture of for profitable operations as the solid performance in the face of Equally important, we met this the acquired ice machine brands. economy recovers. extreme market challenges. challenge at a time of extreme Although the proceeds from the sale Manitowoc’s success in this envi- On balance, our 2008 foodser- uncertainty, when many questioned fell far short of what we anticipated, ronment reflects our disciplined EVA vice acquisition created near-term whether the financial community we were pleased to complete the culture and the fundamental strength pressures but also delivered could keep the wheels of commerce transaction despite the extremely of our two global platforms. Overall, early benefits of diversification, turning. The credit freeze hit our difficult market environment. We we had remarkable success in gen- contributing 40% of total Manito- Crane business especially hard and also strategically harvested some erating cash, especially considering woc revenues in 2009 and 55% led customers around the world— of our Foodservice product lines by the difficult market conditions. In the of operating profit. We believe this and especially in North America selling our Lincoln Smallwares and Crane business, we benefited from rebalanced business mix—with two and Europe—to cancel orders. That Merco product lines. our market leadership in the heavy expanding global platforms with directly affected our efforts to gen- As our two business segments lift segment and our competitive industry-leading products—will erate cash out of both profitability focused on cost containment and strength in Asia, Latin America, reduce earnings cyclicality over the and inventory. operational efficiency, we worked Africa, and the Middle East—emerg- long term and reward shareholders Meanwhile, our Foodservice to strike the best balance we could ing economies where energy and as economic conditions improve. business—in its first full year of between reducing debt and investing infrastructure work triggered demand combined operation—pursued an for our high-value equipment. Never- aggressive mandate to identify theless, operating margins declined

Sources of Cash 2001– 2009 Uses of Cash 2001– 2009

Acquisitions 48% Borrowings 60% Debt Paydown Cash from 39% Operations 26% Capital Other 6% Expenditures 9%

Stock Issuances 4% Other 3%

Sales of Fixed Assets 4% Dividends 1%

Sales by Region 2009 Over the past nine years, cash from operations and borrowings collectively Asia/Pacific 11% provided 86% of Manitowoc’s sources of cash. Correspondingly, Manitowoc Europe, used 48% of its cash to make acquisi- Middle East tions, 39% for debt paydown, and 9% and Africa 31% for capital expenditures. Strategic acquisitions in both Cranes and Food- The Americas 58% service have expanded Manitowoc’s geographic footprint, while diversifying its revenue stream.

MN001 2009_Narrative 9 3/19/10 1:44 PM Welcome to Our Form 10-K Comprehensive ﬁ nancial data helps shareholders understand how Mani- towoc is performing and how it is building shareholder value.

We want investors to know the fac- To provide the most complete same information, and we reduce inside or outside of our industries. tors that drive our performance, the information possible, we have the time and expense associated We also have included a number of risks we face, and how we are build- included a copy of the Form 10-K with preparing two, separate audited charts that allow readers to easily ing the value of the company. We required by the Securities and Ex- financial presentations. Reading the track our progress over time. want shareholders to feel confident change Commission with this report. Form 10-K provides the information in Manitowoc and its management. By doing so, we help to ensure that needed to evaluate our performance all shareholders have exactly the and compare it to other businesses

Cash Flow From Operations Working Capital Debt Reduction Research & Development ($ Millions) ($ Millions) ($ Millions) ($ Millions)

$400 $900 $240 $60 $897 $320 $720 $180 $48 $59.0 $220.8 $2,606 $338.6 $573.6 $240 $309.0 $540 $120 $36 $160.9 $293.0 $40.0 $580 $139.6 $36.1 $244.0 $488 $106.7 $160 $360 $ 60 $24 $31.2 $383.2 $139.9 $365.2 ($38.4) $26.0 $351 $57.0 $21.2 $278

$ 80 $180 $267 $ 0 $12

04 05 06 07 08 09 04 05 06 07 08 09 Q1 ’09 Q2 ’09 Q3 ’09 Q4 ’09 04 05 06 07 08 09 Solid cash fl ow gives Manitowoc the During 2009, Manitowoc effectively As a result of cost-cutting initiatives, Innovative products increase sales, fl exibility to fund capital investments reduced its working capital by $317 working capital reductions, and strong expand markets, and boost market that fuel its growth and to reduce its million, which was a key component cash fl ow, Manitowoc reduced its debt shares. In 2009, Manitowoc invested debt. In 2009, Manitowoc generated that enabled the company to surpass by $474 million in 2009. Since its 2008 $59 million in research and develop- $338.6 million in cash from operating its debt reduction target of $450 acquisition of Enodis, Manitowoc has ment initiatives, which resulted in a activities, a 10% improvement over million. repaid $770 million related to this stra- total of 68 new Crane and Foodser- 2008. tegic and transforming acquisition. vice products.

10-K Contents Our Business 3 Consolidated Statements of Goodwill and Other Intangible Assets 59 Sale of Product and Parts Lines 87 Risk Factors 10 Operations 44 Accounts Payable and Accrued Subsequent Events 88 Properties Owned 14 Consolidated Balance Sheets 45 Expenses 61 Changes In and Disagreements Unresolved Staff Comments 14 Consolidated Statements of Cash Debt 61 with Accountants on Accounting Legal Proceedings 16 Flows 46 Accounts Receivable Securitization 63 and Financial Disclosure 98 Market for Registrant’s Common Consolidated Statements of Income Taxes 64 Controls and Procedures 98 Equity and Related Stockholder Stockholders’ Equity and Earnings Per Share 67 Other Information 98 Comprehensive Income 47 Matters 17 Equity 67 Directors, Executive Offi cers and Selected Financial Data 19 Notes to Consolidated Financial Corporate Governance 98 Statements 48 Stock-Based Compensation 68 Management’s Discussion and Executive Compensation 98 Company and Basis of Presentation 48 Contingencies and Signifi cant Analysis of Financial Condition Estimates 70 Security Ownership of Certain and Results of Operations 21 Summary of Signifi cant Accounting Benefi cial Owners and Management 98 Guarantees 71 Quantitative and Qualitative Policies 49 Certain Relationships and Restructuring 71 Disclosures About Market Risk 41 Acquisitions 54 Related Transactions, and Employee Benefi t Plans 72 Financial Statements and Discontinued Operations 55 Director Independence 98 Supplementary Data 42 Fair Value of Financial Instruments 56 Leases 77 Principal Accounting Fees Report of Independent Registered Derivative Financial Instruments 57 Business Segments 77 and Services 98 Public Accounting Firm 43 Inventories 59 Subsidiary Guarantors of Senior Exhibits and Financial Statement Notes Due 2013 79 Property, Plant and Equipment 59 Schedules 99 Quarterly Financial Data (Unaudited) 87

MN001 2009_Narrative 10 3/19/10 2:13:22 AM Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:06 | 09-35779-2.aa | Sequence: 1 CHKSUM Content: 18968 Layout: 38528 Graphics: 4514 CLEAN

United States Securities and Exchange Commission Washington, D.C. 20549 FORM 10-K Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2009 or Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Commission File Number 1-11978

The Manitowoc Company, Inc. (Exact name of registrant as specified in its charter) Wisconsin 39-0448110 (State or other jurisdiction of incorporation) (I.R.S. Employer Identification Number) 2400 South 44th Street, Manitowoc, Wisconsin 54221-0066 (Address of principal executive offices) (Zip Code) (920) 684-4410 (Registrant’s telephone number, including area code)

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class Name of Each Exchange on Which Registered Common Stock, $.01 Par Value New York Stock Exchange Common Stock Purchase Rights

Securities Registered Pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes No Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer, accelerated filer, and smaller reporting company” in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company (Do not check if a smaller reporting company) Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No The Aggregate Market Value on June 30, 2009, of the registrant’s Common Stock held by non-affiliates of the registrant was $682,759,000 based on the closing per share price of $5.23 on that date. The number of shares outstanding of the registrant’s Common Stock as of January 29, 2010, the most recent practicable date, was 130,739,028. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s Proxy Statement, to be prepared and filed for the Annual Meeting of Shareholders, dated March 25, 2010 (the “2010 Proxy Statement”), are incorporated by reference in Part III of this report. See Index to Exhibits immediately following the signature page of this report, which is incorporated herein by reference.

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: box.eps, check box.eps, manitowoc_k_logo.eps V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 1 CHKSUM Content: 33400 Layout: 65459 Graphics: No Graphics CLEAN

THE MANITOWOC COMPANY, INC. Index to Annual Report on Form 10-K For the Year Ended December 31, 2009

PAGE

PART I

Item 1 Business 3 Item 1A Risk Factors 10 Item 1B Unresolved Staff Comments 14 Item 2 Properties 14 Item 3 Legal Proceedings 16 Executive Officers of Registrant 16

PART II

Item 5 Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 17 Item 6 Selected Financial Data 19 Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations 21 Item 7A Quantitative and Qualitative Disclosure about Market Risk 41 Item 8 Financial Statements and Supplementary Data 42 Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 98 Item 9A Controls and Procedures 98 Item 9B Other Information 98

PART III

Item 10 Directors, Executive Officers and Corporate Governance 98 Item 11 Executive Compensation 98 Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 98 Item 13 Certain Relationships and Related Transactions, and Director Independence 98 Item 14 Principal Accounting Fees and Services 98

PART IV

Item 15 Exhibits and Financial Statement Schedules 99

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 2 CHKSUM Content: 51077 Layout: 27954 Graphics: No Graphics CLEAN

sition and transaction fees, is the largest and most recent PART I acquisition for the company and has positioned Manitowoc ITEM 1. BUSINESS among the world’s leading designers and manufacturers of commercial foodservice equipment. Our Foodservice prod- General ucts are marketed under the Manitowoc, Garland, U.S. The Manitowoc Company, Inc. (referred to as the company, Range, Convotherm, Cleveland, Lincoln, Merrychef, MTW, Manitowoc, we, our, and us) was founded in 1902. Frymaster, Delfield, Kolpak, Kysor Panel, Kysor Warren, We are a multi-industry, capital goods manufacturer operat- Jackson, Servend, Multiplex, and Manitowoc Beverage ing in two principal markets: Cranes and Related Products System brand names. Our Foodservice capabilities now span (Crane) and Foodservice Equipment (Foodservice). Crane is refrigeration, ice-making, cooking, food-preparation, and recognized as one of the world’s leading providers of engi- beverage-dispensing technologies, and allow us to be able to neered lifting equipment for the global construction industry, equip entire commercial kitchens and serve the world’s including lattice-boom cranes, tower cranes, mobile tele- growing demand for food prepared away from home. See scopic cranes, and boom trucks. Foodservice is one of the further details related to the acquisition at Note 3, world’s leading innovators and manufacturers of commercial “Acquisitions.” foodservice equipment serving the ice, beverage, refrigera- In order to secure clearance for the acquisition of Enodis tion, food-preparation, cooking needs of restaurants, con- from various regulatory authorities including the European venience stores, hotels, healthcare, and institutional Commission and the United States Department of Justice, applications. We have over a 100-year tradition of providing the company agreed to sell substantially all of Enodis’ global high-quality, customer-focused products and support service machine operations following completion of the transac- ices to our markets. For the year ended December 31, 2009 tion. On May 15, 2009, the company completed the sale of we had net sales of approximately $3.8 billion. the Enodis global ice machine operations to Braveheart Our Crane business is a global provider of engineered lift Acquisition, Inc., an affiliate of Warburg Pincus Private solutions, offering one of the broadest product lines of lift- Equity X, L.P., for $160 million. The businesses sold were ing equipment in our industry. We design, manufacture, mar- operated under the Scotsman, Ice-O-Matic, Simag, Barline, ket, and support a comprehensive line of lattice boom Icematic, and Oref brand names. The company also agreed crawler cranes, mobile telescopic cranes, tower cranes, and to sell certain non-ice businesses of Enodis located in Italy boom trucks. Our Crane products are principally marketed that are operated under the Tecnomac and Icematic brand under the Manitowoc, Grove, Potain, National, Shuttlelift, names. Prior to disposal, the antitrust clearances required Dongyue, and Crane Care brand names and are used in a that the ice businesses were treated as standalone opera- wide variety of applications, including energy and utilities, tions, in competition with the company. The results of these petrochemical and industrial projects, infrastructure develop- operations have been classified as discontinued operations. ment such as road, bridge and airport construction, and On December 31, 2008, the company completed the sale commercial and high-rise residential construction. of its Marine segment to Fincantieri Marine Group Holdings On October 27, 2008, we completed our acquisition of Inc., a subsidiary of Fincantieri — Cantieri Navali Italiani SpA. Enodis plc (Enodis), a global leader in the design and manu- The sale price in the all-cash deal was approximately facture of innovative equipment for the commercial foodser- $120 million. The company is reporting the Marine segment vice industry. The $2.7 billion acquisition, inclusive of the as a discontinued operation for financial reporting purposes. purchase of outstanding shares and rights to shares, Our principal executive offices are located at 2400 South acquired debt, the settlement of hedges related to the acqui- 44th Street, Manitowoc, Wisconsin 54220.

The Manitowoc Company, Inc. — 2009 Form 10-K 3

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 3 CHKSUM Content: 39804 Layout: 5658 Graphics: No Graphics CLEAN

Financial Information About Business Segments overhead, amortization expense of intangible assets with The following is financial information about the Crane and definite lives, interest expense, and income tax expense. Foodservice segments for the years ended December 31, The company evaluates segment performance based upon 2009, 2008 and 2007. The accounting policies of the seg- profit and loss before the aforementioned expenses. ments are the same as those described in the summary of Restructuring costs separately identified in the Consolidated significant accounting policies of the Notes to the Consoli- Statements of Operations are included as reductions to the dated Financial Statements included in Item 8 of this respective segment’s operating earnings for each year Form 10-K, except that certain expenses are not allocated to below. Amounts are shown in millions of dollars. the segments. These unallocated expenses are corporate

2009 2008 2007 Net sales from continuing operations: Crane $2,285.0 $3,882.9 $3,245.7 Foodservice 1,497.6 620.1 438.3 Total $3,782.6 $4,503.0 $3,684.0 Operating earnings (loss) from continuing operations: Crane $ 145.0 $ 555.6 $ 470.5 Foodservice 174.3 56.8 61.3 Corporate (44.4) (51.7) (48.2) Amortization expense (39.5) (11.6) (5.8) Gain on sale of parts line — — 3.3 Goodwill impairment (548.8) — — Intangible asset impairment (151.2) — — Restructuring expense (39.6) (21.7) — Integration expense (3.6) (7.6) — Loss on sale of product lines (3.4) — — Pension settlements — — (5.3) Total $ (511.2) $ 519.8 $ 475.8 Capital expenditures: Crane $ 51.5 $ 129.4 $ 103.7 Foodservice 18.4 10.9 3.7 Corporate 2.6 10.0 5.4 Total $ 72.5 $ 150.3 $ 112.8 Total depreciation: Crane $ 55.3 $ 66.3 $ 70.4 Foodservice 33.5 12.4 8.0 Corporate 2.8 1.5 1.8 Total $ 91.6 $ 80.2 $ 80.2 Total assets: Crane $1,738.4 $2,223.7 $1,958.0 Foodservice 2,279.5 3,389.4 341.5 Corporate 260.8 473.0 571.9 Total $4,278.7 $6,086.1 $2,871.4

4 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 4 CHKSUM Content: 43068 Layout: 14599 Graphics: No Graphics CLEAN

Products and Services We sell our products categorized in the following business segments:

Percentage of Business Segment 2009 Net Sales Key Products Key Brands Cranes and Related 60% Lattice-boom Cranes: which include crawler and truck mounted lattice- Manitowoc Products boom cranes, and crawler crane attachments; Tower Cranes: which include Potain top slewing luffing jib, topless, and self-erecting tower cranes; Mobile Grove Telescopic Cranes: including rough terrain, all-terrain, truck mounted and National industrial cranes; Boom Trucks: which include telescopic and articulated Shuttlelift boom trucks; Parts and Service: which include replacement parts, product Dongyue services and crane rebuilding and remanufacturing services. Crane Care

Foodservice Equipment 40% Primary cooking and warming equipment; Ice-cube machines, ice flaker Cleveland machines and storage bins; Refrigerator and Freezer Equipment; Convotherm Warewashing Equipment; Beverage Dispensers and related products; Delfield serving and storage equipment; and food preparation equipment. Frymaster Garland Jackson Kolpak Kysor Panel Systems Kysor Warren Lincoln Manitowoc Merrychef Multiplex SerVend

Cranes and Related Products four chords and tubular lacings, mounted on a base which is Our Crane segment designs, manufactures and distributes a either crawler or truck mounted. Lattice-boom cranes pro- diversified line of crawler mounted lattice-boom cranes, vide higher lifting capacities than a telescopic boom of simi- which we sell under the Manitowoc name. Our Crane seg- lar length. The lattice-boom cranes are the only category of ment also designs and manufactures a diversified line of top crane that can pick and move simultaneously with a full slewing and self erecting tower cranes, which we sell under rated load. The lattice-boom sections, together with the the Potain name. We design and manufacture mobile tele- crane base, are transported to and erected at a project site. scopic cranes, which we sell under the Grove, Shuttlelift, We currently offer models of lattice-boom cranes with lift- and Dongyue names, and a comprehensive line of hydrauli- ing capacities up to 2,500 U.S. tons, which are used to lift cally powered telescopic boom trucks, which we sell under material and equipment in a wide variety of applications and the National Crane brand name. We also provide crane prod- end markets, including heavy construction, bridge and high- uct parts and services, and crane rebuilding, remanufactur- way, duty cycle and infrastructure and energy related proj- ing, and training services which are delivered under the ects. These cranes are also used by the value-added crane Manitowoc Crane Care brand name. In some cases our rental industry, which serves all of the above end markets. products are manufactured for us or distributed for us under Lattice-boom crawler cranes may be classified according strategic alliances. Our crane products are used in a wide to their lift capacity — low capacity and high capacity. Low variety of applications throughout the world, including capacity crawler cranes with 150-U.S. ton capacity or less energy and utilities, petrochemical and industrial projects, are often utilized for general construction and duty cycle infrastructure development such as road, bridge and airport applications. High capacity crawler cranes with greater than construction, and commercial and high-rise residential con- 150-U.S. ton capacity are utilized to lift materials in a wide struction. Many of our customers purchase one or more variety of applications and are often utilized in heavy con- crane(s) together with several attachments to permit use of struction, energy-related, stadium construction, petrochemi- the crane in a broader range of lifting applications and other cal work, and dockside applications. We offer five operations. Our largest crane model combined with available low-capacity models and eight high-capacity models. options has a lifting capacity up to 2,500 U.S. tons. Our pri- We also offer our lattice-boom crawler crane customers mary growth drivers are our strength in energy, infrastruc- various attachments that provide our cranes with greater ture, construction and petro-chemical related end markets. capacity in terms of height, movement and lifting. Our principal attachments are: MAX-ERTM attachments, luffing jibs, and Lattice-boom Cranes. Under the Manitowoc brand name RINGERTM attachments. The MAX-ER is a trailing, counter- we design, manufacture and distribute lattice-boom crawler weight, heavy-lift attachment that dramatically improves the cranes. Lattice-boom cranes consist of a lattice-boom, reach, capacity and lift dynamics of the basic crane to which which is a fabricated, high-strength steel structure that has it is mounted. It can be transferred between cranes of the

The Manitowoc Company, Inc. — 2009 Form 10-K 5

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 5 CHKSUM Content: 26548 Layout: 48312 Graphics: No Graphics CLEAN

same model for maximum economy and occupies less currently offer 10 models of luffing jib tower cranes with space than competitive heavy-lift systems. A luffing jib is a maximum jib lengths of 60 meters and lifting capabilities fabricated structure similar to, but smaller than, a lattice- ranging between 90 and 600 meter-tons. boom. Mounted at the tip of a lattice-boom, a luffing jib eas- Self-erecting tower cranes are mounted on axles or trans- ily adjusts its angle of operation permitting one crane with a ported on a trailer. The lower segment of the range (Igo luffing jib to make lifts at additional locations on the project cranes up to Igo50) unfolds in four sections, two for the site. It can be transferred between cranes of the same tower and two for the jib. The smallest of our models unfolds model to maximize utilization. A RINGER attachment is a in less than 8 minutes; larger models erect in a few hours. high-capacity lift attachment that distributes load reactions Self erecting cranes rotate from the bottom of their mast. We over a large area to minimize ground-bearing pressure. It can offer 23 models of self erecting cranes with maximum jib also be more economical than transporting and setting up a lengths of 50 meters and lifting capacities ranging between larger crane. 10 and 120 meter-tons which are utilized primarily in low to medium rise construction and residential applications. Tower Cranes. Under the Potain brand name we design and manufacture tower cranes utilized primarily in the building Mobile Telescopic Cranes. Under the Grove brand name we and construction industry. Tower cranes offer the ability to design and manufacture 35 models of mobile telescopic lift and distribute material at the point of use more quickly cranes utilized primarily in industrial, commercial and con- and accurately than other types of lifting machinery without struction applications, as well as in maintenance applica- utilizing substantial square footage on the ground. Tower tions to lift and move material at job sites. Mobile telescopic cranes include a stationary vertical tower and a horizontal jib cranes consist of a telescopic boom mounted on a wheeled with a counterweight, which is placed near the vertical carrier. Mobile telescopic cranes are similar to lattice-boom tower. A cable runs through a trolley which is on the jib, cranes in that they are designed to lift heavy loads using a enabling the load to move along the jib. The jib rotates mobile carrier as a platform, enabling the crane to move on 360 degrees, thus increasing the crane’s work area. Unless and around a job site without typically having to re-erect the using a remote control device, operators occupy a cabin, crane for each particular job. Additionally, many mobile tele- located where the jib and tower meet, which provides supe- scopic cranes have the ability to drive between sites, and rior visibility above the worksite. We offer a complete line of some are permitted on public roadways. We currently offer tower crane products, including top slewing, luffing jib, top- the following four types of mobile telescopic cranes capable less, self-erecting, and special cranes for dams, harbors and of reaching tip heights of 427 feet with lifting capacities up other large building projects. Top slewing cranes are the to 550 U.S. tons: (i) rough terrain, (ii) all-terrain, (iii) truck most traditional form of tower cranes. Self-erecting cranes mounted, and (iv) industrial. are bottom slewing cranes which have counterweight Rough terrain cranes are designed to lift materials and located at the bottom of the tower and are able to be equipment on rough or uneven terrain. These cranes cannot erected, used and dismantled on job sites without assist be driven on public roadways, and, accordingly, must be cranes. transported by truck to a work site. We produce, under the Top slewing tower cranes have a tower and multi-sectioned Grove brand name, 7 models of rough terrain cranes capable horizontal jib. These cranes rotate from the top of their mast of tip heights of up to 279 feet and maximum load capaci- and can increase in height with the project. Top slewing ties of up to 130 U.S. tons. cranes are transported in separate pieces and assembled at All-terrain cranes are versatile cranes designed to lift the construction site in one to three days depending on the materials and equipment on rough or uneven terrain and yet height. We offer 22 models of top slewing tower cranes are highly maneuverable and capable of highway speeds. with maximum jib lengths of 85 meters and lifting capabili- We produce, under the Grove brand name, 15 models of all- ties ranging between 40 and 3,600 meter-tons. These cranes terrain cranes capable of tip heights of up to 427 feet and are generally sold to medium to large building and construc- maximum load capacities of up to 550 U.S. tons. tion groups, as well as rental companies. Truck mounted cranes are designed to provide simple set- Topless tower cranes are a type of top slewing crane and, up and long reach high capacity booms and are capable of unlike all others, have no cathead or jib tie-bars on the top of traveling from site to site at highway speeds. These cranes the mast. The cranes are utilized primarily when overhead are suitable for urban and suburban uses. We produce, height is constrained or in situations where several cranes are under the Grove brand name, 4 models of truck mounted installed close together. We currently offer 15 models of top- cranes capable of tip heights of up to 237 feet and maxi- less tower cranes with maximum jib lengths of 75 meters and mum load capacities of up to 90 U.S. tons. lifting capabilities ranging between 90 and 300 meter-tons. Industrial cranes are designed primarily for plant mainte- Luffing jib tower cranes, which are a type of top slewing nance, storage yard and material handling jobs. We manufac- crane, have an angled rather than horizontal jib. Unlike other ture, under the Grove and Shuttlelift brand names, 7 models tower cranes which have a trolley that controls the lateral of industrial cranes. We recently launched a new 25 U.S. ton movement of the load, luffing jib cranes move their load by industrial crane capable of tip heights of up to 94 feet. This changing the angle of the jib. The cranes are utilized prima- new model (YB7725) will take the place of the previous rily in urban areas where space is constrained or in situa- 22 U.S. ton crane. tions where several cranes are installed close together. We

6 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 6 CHKSUM Content: 38970 Layout: 29962 Graphics: No Graphics CLEAN

High Reach Telescopic Hydraulic Cranes. We launched a Ice-Cube Machines, Ice Flaker Machines, Nugget Ice new crane concept in 2007 for heavy lifts that require a high Machines, Ice Dispensers and Storage Bins. We design, reach, but with minimal ground space and greatly reduced manufacture and sell ice machines under the Manitowoc erection time. The GTK 1100 is a high reach telescopic brand name, serving the foodservice, convenience store, hydraulic crane that can lift a 77 U.S. ton load up to 394 feet, healthcare, restaurant, lodging and other markets. Our ice only requires about six hours to erect and is based on a machines make ice in cube, nugget and flake form, and combination of mobile crane and tower crane technology. range in daily production capacities. The ice-cube machines are either self-contained units, which make and store ice, or Boom Trucks. We offer our hydraulic boom truck products modular units, which make, but do not store ice. Our ice dis- under the National Crane product line. A boom truck is a pensers generally are paired with our ice making equipment, hydraulically powered telescopic crane mounted on a con- and dispense ice or ice and water. ventional truck chassis. Telescopic boom trucks are used primarily for lifting material on a job site. We currently offer, Refrigerator and Freezer Equipment. We design, manufac- under the National Crane brand name, 15 models of tele- ture and sell commercial upright and undercounter refrigera- scoping boom trucks. The largest capacity cranes of this tors and freezers, blast freezers, blast chillers and cook-chill type are capable of reaching maximum heights of 179 feet systems under the Delfield, McCall, Koolaire and Sadia and have lifting capacity up to 50 U.S. tons. Refrigeration brand names. We also design, manufacture and sell refrigerated self-serve cases, service deli cases and Backlog. The year-end backlog of crane products includes custom merchandisers as well as standard and customized accepted orders that have been placed on a production refrigeration systems under the Kysor/Warren and RDI brand schedule that we expect to be shipped and billed during the names. We manufacture under the brand names Kolpak, next year. Manitowoc’s backlog of unfilled orders for the Kysor Panel Systems and Harford-Duracool modular and fully Crane segment at December 31, 2009, 2008 and 2007 was assembled walk-in refrigerators, coolers and freezers and $572.7 million, $1,948.0 million and $2,877.2 million, prefabricated cooler and freezer panels for use in the con- respectively. struction of refrigerated storage rooms and environmental systems. Foodservice Equipment Our Foodservice Equipment business designs, manufac- Warewashing Equipment. Under the brand name Jackson, tures and sells primary cooking and warming equipment; we design, manufacture and sell warewashing equipment ice-cube machines, ice flaker machines and storage bins; and other equipment including racks and tables. We offer a refrigerator and freezer equipment; warewashing equip- full range of undercounter dishwashers, door-type dishwash- ment; beverage dispensers and related products; serving ers, conveyor, pot washing and flight-type dishwashers. and storage equipment; and food preparation equipment. Our suite of products is used by commercial and institu- Beverage Dispensers and Related Products. We produce tional foodservice operators such as full service restaurants, beverage dispensers, ice/beverage dispensers, beer coolers, quick-service restaurant (QSR) chains, hotels, caterers, post-mix dispensing valves, backroom equipment and sup- supermarkets, convenience stores, business and industry, port system components and related equipment for use by hospitals, schools and other institutions. We have a pres- QSR chains, convenience stores, bottling operations, movie ence throughout the world’s most significant markets in the theaters, and the soft-drink industry. Our beverage and following product groups: related products are sold under the Servend, Multiplex, TruPour, Manitowoc Beverage Systems and McCann’s brand Primary Cooking and Warming Equipment. We design, names. manufacture and sell a broad array of ranges, griddles, grills, combination ovens, convection ovens, conveyor Serving and Storage Equipment. We design, manufacture ovens, rotisseries, induction cookers, broilers, tilt fry and sell a range of buffet equipment and stations, cafete- pans/kettles/skillets, braising pans, cheese melters/salaman- ria/buffet equipment stations, bins, boxes, warming cabi- ders, cook stations, table top and counter top cooking/frying nets, dish carts, utility carts, counters and counter tops, systems, filtering systems, fryers, hotdog grills and steam- mixer stands, tray dispensers, display and deli cases, heat- ers, steam jacketed kettles, steamers and toasters. We sell lamps, insulated and refrigerated salad/food bars, sneeze traditional oven, combi oven, convection oven, conveyor guards and warmers. Our equipment stations, cases, food oven, accelerated cooking oven, range and grill products bars and food serving lines are marketed under the Delfield, under the Garland, Lincoln, Merrychef, U.S. Range, and other Viscount and other brand names. brand names. Fryers and frying systems are marketed under Food Preparation Equipment. We manufacture and distrib- the Frymaster and other brand names while steam equip- ute food mixing equipment under the Varimixer brand name. ment is manufactured and sold under the Cleveland and The end customer base for the Foodservice Equipment Convotherm brands. In addition to cooking, we provide a segment is comprised of a wide variety of foodservice range of warming, holding, merchandising and serving providers, including, but not limited to, large multinational equipment under the Delfield, Fabristeel, Frymaster, Savory, chain restaurants, convenience stores and retail stores; and other brand names. chain and independent casual and family dining restaurants; independent restaurants and caterers; lodging, resort,

The Manitowoc Company, Inc. — 2009 Form 10-K 7

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 7 CHKSUM Content: 63194 Layout: 62175 Graphics: No Graphics CLEAN

leisure and convention facilities; health care facilities; Backlog. The backlog for unfilled orders for our Foodservice schools and universities; large business and industrial cus- segment at December 31, 2009, 2008 and 2007 was not sig- tomers; and many other foodservice outlets. We cater to nificant because orders are generally filled shortly after some of the largest and most widely recognized multina- receiving the customer order. tional businesses in the foodservice and hospitality industries. We do not typically have long term contracts with our Raw Materials and Supplies customers; however, large chains frequently authorize spe- The primary raw materials that we use are structural and cific foodservice equipment manufacturers as approved ven- rolled steel, aluminum, and copper, which are purchased dors for particular products and thereafter, sales are made from various domestic and international sources. We also locally or regionally to end customers via kitchen equipment purchase engines and electrical equipment and other semi- suppliers, dealers or distributors. Many large QSR chains and fully-processed materials. Our policy is to maintain, refurbish or open a large number of outlets, or implement wherever possible, alternate sources of supply for our menu changes requiring investment in new equipment, over important materials and parts. We maintain inventories of a short period of time. When this occurs, these customers steel and other purchased material. We have been success- often choose a small number of manufacturers whose ful in our goal to maintain alternative sources of raw materi- approved products may or must be purchased by restaurant als and supplies, and therefore are not dependent on a operators. We work closely with our customers to develop single source for any particular raw material or supply. the products they need and to become the approved vendors for these products. Patents, Trademarks, and Licenses Our end customers often need equipment upgrades that We hold numerous patents pertaining to our Crane and enable them to improve productivity and food safety, reduce Foodservice products, and have presently pending applica- labor costs, respond to enhanced hygiene, environmental tions for additional patents in the United States and foreign and menu requirements or reduce energy consumption. countries. In addition, we have various registered and unreg- These changes often require customized cooking and cool- istered trademarks and licenses that are of material impor- ing and freezing equipment. In addition, many restaurants, tance to our business and we believe our ownership of this especially QSRs, seek to differentiate their products by intellectual property is adequately protected in customary changing their menu and format. We believe that product fashions under applicable law. No single patent, trademark development is important to our success because a sup- or license is critical to our overall business. plier’s ability to provide customized or innovative foodservice equipment is a primary factor when customers are Seasonality making their purchasing decisions. Recognizing the impor- Typically, the second and third quarters represent our best tance of providing innovative products to our customers, we quarters for our consolidated financial results. In our Crane invest significant time and resources into new product segment, the northern hemisphere summer represents the research and development. main construction season. Customers require new The Manitowoc Education and Technology Center (ETC) in machines, parts, and service during that season. Since the New Port Richey, Florida contains computer-assisted design summer brings warmer weather, there is also an increase in platforms, a model shop for on-site development of proto- the use and replacement of ice machines, as well as new types, a laboratory for product testing and various display construction and remodeling within the foodservice industry. areas for new products. Our test kitchen, flexible demon- As a result, distributors build inventories during the second stration areas and culinary team enable us to demonstrate a quarter for the increased demand. More recently, the tradi- wide range of equipment in realistic operating environ- tional seasonality for our Crane and Foodservice segments ments, and also support a wide range of menu ideation, has been slightly muted due to more diversified product and food development and sensory testing with our customers geographic end markets as well as the impact that the and food partners. We also use the ETC to provide training global economic recession and downturn in our end markets for our customers, marketing representatives, service has had on our revenue. providers, industry consultants, dealers and distributors. At our ETC and through outreach programs, we also work Competition directly with our customers to provide customized solutions We sell all of our products in highly competitive industries. to meet their precise needs. When a customer requests a We compete in each of our industries based on product new or refined product, our engineering team designs, pro- design, quality of products and aftermarket support serv- totypes, tests, demonstrates, evaluates and refines products ices, product performance, maintenance costs, energy and in our ETC with our customer. The ETC works together with resource saving, other contributions to sustainability and the new product development teams at our operating com- price. Some of our competitors may have greater financial, panies so that new products incorporate our overall product marketing, manufacturing or distribution resources than we expertise and technological resources. We also provide a do. We believe that we benefit from the following competi- fee-based consulting service through our High Performance tive advantages: a strong brand name, a reputation for qual- Kitchen (HPK) team that interacts with targeted customers ity products and aftermarket support services, an to effectively integrate new technology, improve facility established network of global distributors and customer operation and labor processes, and to assist in developing relationships, broad product line offerings in the markets we optimized kitchens of the future. serve, and a commitment to engineering design and product

8 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 8 CHKSUM Content: 62166 Layout: 33659 Graphics: No Graphics CLEAN

innovation. However, we cannot be certain that our products maintain our profit margins on sales to our customers. The and services will continue to compete successfully or that following table sets forth our primary competitors in each of we will be able to retain our customer base or improve or our business segments:

Business Segment Products Primary Competitors Cranes and Related Products Lattice-boom Crawler Cranes Hitachi Sumitomo; Kobelco; Liebherr; Sumitomo/Link-Belt; Terex; XCMG; Fushun; Zoomlion; and Sany Tower Cranes Comansa; Terex Comedil/Peiner; Liebherr; FM Gru; Jaso; Raimondi; Viccario; Saez; Benezzato; Cattaneo; Sichuan Construction Machinery; Shenyang; Zoomlion; Jianglu; and Yongmao Mobile Telescopic Cranes Liebherr; Link-Belt; Terex; Tadano; XCMG; Kato; Locatelli; Marchetti; Luna; Broderson; Valla; Ormig; Bencini; and Zoomlion Boom Trucks Terex; Manitex; Altec; Elliott; Tadano; Fassi; Palfinger; Furukawa; and Hiab Foodservice Equipment Ice-Cube Machines, Ice Flaker Machines, Hoshizaki; Scotsman; Follet; Ice-O-Matic; Brema; Aucma; and Vogt Storage Bins Beverage Dispensers and Related Products Automatic Bar Controls; Celli; Cornelius; Hoshizaki/Lancer Corporation; and Vin Service Refrigerator and Freezer Equipment American Panel; ICS; Nor-Lake; Master-Bilt; Thermo-Kool; Bally; Arctic; Beverage Air; Traulsen; True Foodservice; TurboAir; and Masterbilt Primary Cooking Equipment Ali Group; Electrolux; Dover Industries; Duke; Henny Penny; ITW; Middleby; and Rational Serving, Warming and Storage Equipment Alto Shaam; Cambro; Duke; Hatco; ITW; Middleby; Standex; and Vollrath Food Preparation Equipment Ali Group; Bizerba; Electrolux; German Knife; Globe; ITW; and Univex Warewashing Equipment ADS; Auto-Chlor; Ali Group; Electrolux; Insinger; ITW; Meiko; and Winterhalter

Engineering, Research and Development locals in North America. During the fourth quarter of 2008 Our extensive engineering, research and development capa- we added six facilities in North America from the Enodis bilities have been key drivers of our success. We engage in acquisition that are represented by unions. In addition, we research and development activities at each of our significant reduced the number of unions by four, with the sale of the manufacturing facilities. We have a staff of engineers and Marine segment in December of 2008 and the sale of the technicians on three continents who are responsible for Enodis ice machine operations in May of 2009. A large improving existing products and developing new products. majority of our European employees belong to European We incurred research and development costs of $59.0 million trade unions and, during 2008, a contract was signed by all in 2009, $40.0 million in 2008 and $36.1 million in 2007. unions for our French crane locations. We have three trade Our team of engineers focuses on developing innovative, unions in China and one trade union in India. The Indian high performance, low maintenance products that are trade contract expired in June of 2009; a new contract is intended to create significant brand loyalty among customers. being negotiated. There were only minor work stoppages Design engineers work closely with our manufacturing and during 2008 and 2009 and no work stoppages during 2007. marketing staff, enabling us to identify changing end-user During 2010, we have 4 union contracts expiring at various requirements, implement new technologies and effectively times that will therefore require renegotiation. introduce product innovations. Close, carefully managed relationships with dealers, distributors and end users help us Available Information identify their needs, not only for products, but for the service We make available, free of charge at our internet site and support that are critical to their profitable operations. As (www.manitowoc.com), our annual report on Form 10-K, part of our ongoing commitment to provide superior prod- quarterly reports on Form 10-Q, current reports on Form 8-K, ucts, we intend to continue our efforts to design products our proxy statement and any amendments to those reports, that meet evolving customer demands and reduce the period as soon as reasonably practicable after we electronically file from product conception to product introduction. such material with, or furnish it to, the Securities and Exchange Commission (SEC). Our SEC reports can be Employee Relations accessed through the investor relations section of our web- As of December 31, 2009, we employed approximately site. Although some documents available on our website are 13,100 people and had labor agreements with 14 union filed with the SEC, the information generally found on our

The Manitowoc Company, Inc. — 2009 Form 10-K 9

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 9 CHKSUM Content: 24072 Layout: 41619 Graphics: No Graphics CLEAN

website is not part of this or any other report we file with or maintains electronic versions of our reports on its website at furnish to the SEC. www.sec.gov. The public may read and copy any materials that we file with the SEC at the SEC’s Public Reference Room located at Geographic Areas 100 F Street NE, Washington, DC 20549. The public may Net sales from continuing operations and long-lived asset obtain information on the operation of the Public Reference information by geographic area as of and for the years Room by calling the SEC at 1-800-SEC-0330. The SEC also ended December 31 are as follows:

Net Sales Long-Lived Assets 2009 2008 2007 2009 2008 United States $1,862.6 $1,896.6 $1,627.4 $457.7 $ 484.0 Other North America 177.3 127.7 114.1 7.4 7.4 Europe 824.8 1,444.2 1,215.0 264.6 450.2 Asia 279.1 395.0 299.5 76.4 80.0 Middle East 274.6 314.0 183.0 1.8 1.8 Central and South America 155.0 117.4 61.9 0.3 0.6 Africa 88.9 82.8 64.2 — — South Pacific and Caribbean 32.2 13.5 16.0 5.2 5.4 Australia 88.1 111.8 102.9 1.2 2.2 Total $3,782.6 $4,503.0 $3,684.0 $814.6 $1,031.6

ITEM 1A. RISK FACTORS appropriations, including infrastructure, security and defense outlays. Reductions in governmental spending can reduce The following are risk factors identified by management that demand for our products, which in turn can affect our if any events contemplated by the following risks actually performance. Weather conditions can substantially affect occur, then our business, financial condition or results of our Foodservice segment, as relatively cool summer operations could be materially adversely affected. weather and cooler-than-normal weather in hot climates tend to decrease sales of ice and beverage dispensers. Our Some of our business segments are cyclical or are sales depend in part upon our customers’ replacement or otherwise sensitive to volatile or variable factors. A repair cycles. Adverse economic conditions, such as those downturn or weakness in overall economic activity or experienced in fiscal 2009, may cause customers to forego fluctuations in those other factors can have a material or postpone new purchases in favor of repairing existing adverse effect on us. machinery. Historically, sales of products that we manufacture and sell have been subject to cyclical variations caused by changes A substantial portion of our growth has come in general economic conditions and other factors. In particu- through acquisitions. We may not be able to identify lar, the demand for our crane products is cyclical and is or complete future acquisitions, which could impacted by the strength of the economy generally, the adversely affect our future growth. availability of financing and other factors that may have an Our growth strategy historically has been based in part upon effect on the level of construction activity on an interna- acquisitions. Our successful growth through acquisitions tional, national or regional basis. During periods of expan- depends upon our ability to identify and successfully negoti- sion in construction activity, we generally have benefited ate suitable acquisitions, obtain financing for future acquisi- from increased demand for our products. Conversely, during tions on satisfactory terms or otherwise complete recessionary periods, we have been adversely affected by acquisitions in the future. In addition, our level of indebted- reduced demand for our products. In addition, the strength ness may increase in the future if we finance other acquisi- of the economy generally may affect the rates of expansion, tions with debt. This would cause us to incur additional consolidation, renovation and equipment replacement within interest expense and could increase our vulnerability to gen- the restaurant, lodging, convenience store and healthcare eral adverse economic and industry conditions and limit our industries, which may affect the performance of our Food- ability to service our debt or obtain additional financing. Fur- service segment. Furthermore, an economic recession may thermore, our current leverage position may prevent us from impact leveraged companies, such as Manitowoc, more pursuing potential acquisition candidates until we are able to than competing companies with less leverage and may have reduce our debt and leverage to a point where additional a material adverse effect on our financial condition, results debt could be incurred to support the financing of such an of operations and cash flows. acquisition. We cannot assure that future acquisitions will Products in our Crane segment depend in part on federal, not have a material adverse effect on our financial condition, state, local and foreign governmental spending and results of operations and cash flows.

10 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 10 CHKSUM Content: 22857 Layout: 29962 Graphics: No Graphics CLEAN

Our future success depends on our ability to purchase used equipment, or competitors’ products, rather effectively integrate acquired companies and than invest in new products manufactured by us. manage growth. Our growth has placed, and will continue to place, signifi- Price increases in some materials and sources of cant demands on our management, operational and financial supply could affect our profitability. resources. We have made significant acquisitions since We use large amounts of steel, stainless steel, aluminum, 1995. Future acquisitions will require integration of the copper and electronic controls, among other items, in the acquired companies’ sales and marketing, distribution, man- manufacture of our products. Occasionally, market prices of ufacturing, engineering, purchasing, finance and administra- some of our key raw materials increase significantly. In par- tive organizations. Experience has demonstrated that the ticular, we have experienced significant increases in steel, successful integration of acquired businesses requires sub- aluminum, foam, and copper prices at times in recent peri- stantial attention from our senior management and the man- ods, which have increased our expenses. If in the future we agement of the acquired companies, which tends to reduce are not able to reduce product cost in other areas or pass the time that they have to manage the ongoing business. raw material price increases on to our customers, our mar- We are currently in the process of integrating the Enodis gins could be adversely affected. In addition, because we acquisition. While we believe we have successfully inte- maintain limited raw material and component inventories, grated our acquisitions prior to Enodis and we believe we even brief unanticipated delays in delivery by suppliers — are on track to complete a successful integration of the including those due to capacity constraints, labor disputes, Enodis acquisition, we cannot assure you that we will be impaired financial condition of suppliers, weather emergen- able to integrate Enodis or any future acquisitions success- cies or other natural disasters — may impair our ability to fully, that the acquired companies will operate profitably or satisfy our customers and could adversely affect our finan- that the intended beneficial effect from these acquisitions cial performance. will be realized. Our financial condition, results of operations To better manage our exposures to certain commodity and cash flows could be materially and adversely affected if price fluctuations, we regularly hedge our commodity expo- we do not successfully integrate Enodis or any other future sures through financial markets. Through this hedging we fix companies that we may acquire or if we do not manage our the future price for a portion of these commodities utilized in growth effectively. the production of our products. To the extent that our hedging is not successful in fixing commodity prices that are Because we participate in industries that are favorable in comparison to market prices at the time of pur- intensely competitive, our net sales and profits could chase, we would experience a negative impact on our profit decline as we respond to competition. margins compared to the margins we would have realized if We sell most of our products in highly competitive indus- these price commitments were not in place, which may tries. We compete in each of those industries based on adversely affect our results of operations, financial condition product design, quality of products, quality and responsive- and cash flows in future periods. ness of product support services, product performance, maintenance costs and price. Some of our competitors may We increasingly manufacture and sell our products have greater financial, marketing, manufacturing and distri- outside of the United States, which may present bution resources than we do. We cannot be certain that our additional risks to our business. products and services will continue to compete successfully For the years ended December 31, 2009, 2008 and 2007, with those of our competitors or that we will be able to approximately 51%, 58% and 56%, respectively, of our net retain our customer base or improve or maintain our profit sales were attributable to products sold outside of the margins on sales to our customers, any of which could United States. Expanding international sales is part of our materially and adversely affect our financial condition, growth strategy. We acquired 22 major manufacturing facili- results of operations and cash flows. ties with the Enodis acquisition, 16 of which are in North America, 4 are in Europe, and 2 are in Asia. See further detail If we fail to develop new and innovative products or related to the facilities at Item 2 “Properties.” International if customers in our markets do not accept them, our operations generally are subject to various risks, including results would be negatively affected. political, military, religious and economic instability, local Our products must be kept current to meet our customers’ labor market conditions, the imposition of foreign tariffs, the needs. To remain competitive, we therefore must develop impact of foreign government regulations, the effects of new and innovative products on an on-going basis. If we fail income and withholding tax, governmental expropriation, to make innovations, or the market does not accept our new and differences in business practices. We may incur products, our sales and results would suffer. increased costs and experience delays or disruptions in We invest significantly in the research and development of product deliveries and payments in connection with our new products. These expenditures do not always result in international manufacturing, the integration of our new facili- products that will be accepted by the market. To the extent ties and sales that could cause loss of revenue. Unfavorable they do not, whether as a function of the product or the busi- changes in the political, regulatory and business climate and ness cycle, we will have increased expenses without signifi- currency devaluations of various foreign jurisdictions could cant sales to benefit us. Failure to develop successful new have a material adverse effect on our financial condition, products may also cause potential customers to choose to results of operations and cash flows.

The Manitowoc Company, Inc. — 2009 Form 10-K 11

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 11 CHKSUM Content: 37737 Layout: 22866 Graphics: No Graphics CLEAN

We depend on our key personnel and the loss of businesses also have experienced claims relating to past these personnel could have an adverse affect on our asbestos exposure. Neither we nor our affiliates have to business. date incurred material costs related to these asbestos Our success depends to a large extent upon the continued claims. We vigorously defend ourselves against current services of our key executives, managers and skilled person- claims and intend to do so against future claims. However, a nel. Generally, these employees are not bound by employ- substantial increase in the number of claims that are made ment or non-competition agreements, and we cannot be against us or the amounts of any judgments or settlements sure that we will be able to retain our key officers and could materially and adversely affect our reputation and our employees. We could be seriously harmed by the loss of key financial condition, results of operations and cash flows. personnel if it were to occur in the future. Some of our products are built under fixed-price Our operations and profitability could suffer if we agreements; cost overruns therefore can hurt our experience problems with labor relations. results. As of December 31, 2009, we employed approximately Some of our work is done under agreements on a fixed-price 13,100 people and had labor agreements with 14 union basis. If we do not accurately estimate our costs, we may locals in North America. In addition, a large majority of our incur a loss under these contracts. Even if the agreements European employees belong to European trade unions, and have provisions that allow reimbursement for cost overruns, we have three trade unions in China and one trade union in we may not be able to recoup excess expenses. India. These collective bargaining or similar agreements expire at various times in each of the next several years. We Strategic divestitures could negatively affect our believe that we have satisfactory relations with our unions results. and, therefore, anticipate reaching new agreements on sat- We regularly review our business units and evaluate them isfactory terms as the existing agreements expire. However, against our core business strategies. In addition, at times we may not be able to reach new agreements without a we are forced by regulatory authorities to make business work stoppage or strike, and any new agreements that are divestitures as a result of acquisition transactions. As a reached may not be reached on terms satisfactory to us. result, we regularly consider the divestiture of non-core and These risks are heightened by the current economic environ- non-strategic, or acquisition-related operations or facilities. ment and the headcount reductions we have undertaken Depending upon the circumstances and terms, the divesti- over the last 12 months. A prolonged work stoppage or ture of an operation or facility could negatively affect our strike at any one of our manufacturing facilities could have a earnings from continuing operations. material adverse effect on our financial condition, results of operations and cash flows. Environmental liabilities that may arise in the future could be material to us. If we fail to protect our intellectual property rights or Our operations, facilities and properties are subject to exten- maintain our rights to use licensed intellectual sive and evolving laws and regulations pertaining to air emis- property, our business could be adversely affected. sions, wastewater discharges, the handling and disposal of Our patents, trademarks and licenses are important in the solid and hazardous materials and wastes, the remediation operation of our businesses. Although we intend to protect of contamination, and otherwise relating to health, safety our intellectual property rights vigorously, we cannot be cer- and the protection of the environment. As a result, we are tain that we will be successful in doing so. Third parties may involved from time to time in administrative or legal pro- assert or prosecute infringement claims against us in con- ceedings relating to environmental and health and safety nection with the services and products that we offer, and we matters, and have in the past and will continue to incur capi- may or may not be able to successfully defend these claims. tal costs and other expenditures relating to such matters. Litigation, either to enforce our intellectual property rights or Based on current information, we believe that any costs to defend against claimed infringement of the rights of oth- we may incur relating to environmental matters will not be ers, could result in substantial costs and in a diversion of our material, although we can give no assurances. We also can- resources. In addition, if a third party would prevail in an not be certain that identification of presently unidentified infringement claim against us, then we would likely need to environmental conditions, more vigorous enforcement by obtain a license from the third party on commercial terms, regulatory authorities, or other unanticipated events will not which would likely increase our costs. Our failure to maintain arise in the future and give rise to additional environmental or obtain necessary licenses or an adverse outcome in any liabilities, compliance costs and/or penalties that could be litigation relating to patent infringement or other intellectual material. Further, environmental laws and regulations are property matters could have a material adverse effect on our constantly evolving and it is impossible to predict accurately financial condition, results of operations and cash flows. the effect they may have upon our financial condition, results of operations or cash flows. Our results of operations may be negatively impacted by product liability lawsuits. We are exposed to the risk of foreign currency Our business exposes us to potential product liability risks fluctuations. that are inherent in the design, manufacture, sale and use of Some of our operations are or will be conducted by sub- our products, especially our crane products. Certain of our sidiaries in foreign countries. The results of the operations

12 The Manitowoc Company, Inc. — 2009 Form 10-K

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and the financial position of these subsidiaries will be industry could negatively impact our customer’s ability to reported in the relevant foreign currencies and then trans- obtain the resources needed to make purchases of our lated into U.S. dollars at the applicable exchange rates for equipment or their ability to obtain third-party financing. In inclusion in our consolidated financial statements, which are addition, if the actual value of the equipment for which we stated in U.S. dollars. The exchange rates between many of have provided a residual value guaranty declines below the these currencies and the U.S. dollar have fluctuated signifi- amount of our guaranty, we may incur additional costs, cantly in recent years and may fluctuate significantly in the which may negatively impact our financial condition, results future. Such fluctuations may have a material effect on our of operations and cash flows. results of operations and financial position and may significantly affect the comparability of our results between finan- Our leverage may impair our operations and financial cial periods. condition. In addition, we incur currency transaction risk whenever As of December 31, 2009, our total consolidated debt was one of our operating subsidiaries enters into a transaction $2,172.4 million as compared to consolidated debt of using a different currency than its functional currency. We $2,655.3 million as of December 31, 2008. See further detail attempt to reduce currency transaction risk whenever one of related to the debt in Note 11, “Debt.” Our debt could have our operating subsidiaries enters into a transaction using a important consequences, including increasing our vulnerabil- different currency than its functional currency by: ity to general adverse economic and industry conditions; • matching cash flows and payments in the same currency; requiring a substantial portion of our cash flows from opera- • direct foreign currency borrowing; and tions be used for the payment of interest rather than to fund • entering into foreign exchange contracts for hedging working capital, capital expenditures, acquisitions and gen- purposes. eral corporate requirements; limiting our ability to obtain However, we may not be able to hedge this risk com- additional financing; and limiting our flexibility in planning pletely or at an acceptable cost, which may adversely affect for, or reacting to, changes in our business and the indus- our results of operations, financial condition and cash flows tries in which we operate. in future periods. The agreements governing our debt include covenants that restrict, among other things, our ability to incur addi- Increased or unexpected product warranty claims tional debt; pay dividends on or repurchase our equity; could adversely affect us. make investments; and consolidate, merge or transfer all or We provide our customers a warranty covering workman- substantially all of our assets. In addition, our senior credit ship, and in some cases materials, on products we manufac- facility requires us to maintain specified financial ratios and ture. Our warranty generally provides that products will be satisfy certain financial condition tests. Our ability to comply free from defects for periods ranging from 12 months to with these covenants may be affected by events beyond our 60 months with certain equipment having longer term war- control, including prevailing economic, financial and industry ranties. If a product fails to comply with the warranty, we conditions. These covenants may also require that we take may be obligated, at our expense, to correct any defect by action to reduce our debt or to act in a manner contrary to repairing or replacing the defective product. Although we our business objectives. We cannot be certain that we will maintain warranty reserves in an amount based primarily on meet any future financial tests or that the lenders will waive the number of units shipped and on historical and antici- any failure to meet those tests. See additional discussion in pated warranty claims, there can be no assurance that Note 11, “Debt.” future warranty claims will follow historical patterns or that If we default under our debt agreements, our lenders could we can accurately anticipate the level of future warranty elect to declare all amounts outstanding under our debt claims. An increase in the rate of warranty claims or the agreements to be immediately due and payable and could occurrence of unexpected warranty claims could materially proceed against any collateral securing the debt. Under and adversely affect our financial condition, results of opera- those circumstances, in the absence of readily-available refi- tions and cash flows. nancing on favorable terms, we might elect or be compelled to enter bankruptcy proceedings, in which case our share- Some of our customers rely on financing with third holders could lose the entire value of their investment in our parties to purchase our products, and we may incur common stock. expenses associated with our assistance to customers in securing third party financing. We are in the process of implementing a global ERP We rely principally on sales of our products to generate cash system in our Crane segment. from operations. A portion of our sales is financed by third- We are in the process of implementing a new global ERP party finance companies on behalf of our customers. The system in the Crane segment. This system will replace many availability of financing by third parties is affected by general of our existing operating and financial systems. Such an economic conditions, the credit worthiness of our cus- implementation is a major undertaking both financially and tomers and the estimated residual value of our equipment. from a management and personnel perspective. Due to cur- In certain transactions we provide residual value guarantees rent economic conditions we have delayed the previously and buyback commitments to our customers or the third scheduled implementation timeline for the Crane segment party financial institutions. Deterioration in the credit quality ERP system. One business location implemented this sys- of our customers or the overall health of the banking tem in 2009, but the next business unit is not scheduled to

The Manitowoc Company, Inc. — 2009 Form 10-K 13

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implement this new ERP system until 2012. Should the sys- from numerous suppliers, and, even if our facilities were not tem not be implemented successfully and within budget, or directly affected by such events, we could be affected by if the system does not perform in a satisfactory manner, it interruptions at such suppliers. Such suppliers may be less could be disruptive and adversely affect our operations and likely than our own facilities to be able to quickly recover results of operations, including the ability of the company to from such events and may be subject to additional risks such report accurate and timely financial results. as financial problems that limit their ability to conduct their operations. We cannot assure you that we will have insur- Our inability to recover from natural or man made ance to adequately compensate us for any of these events. disaster could adversely affect our business. Our business and financial results may be affected by certain ITEM 1B. UNRESOLVED STAFF COMMENTS events that we cannot anticipate or that are beyond our control, such as natural or man-made disasters, national emer- The company has received no written comments regarding gencies, significant labor strikes, work stoppages, political its periodic or current reports from the staff of the Securities unrest, war or terrorist activities that could curtail production and Exchange Commission (SEC) that were issued 180 days at our facilities and cause delayed deliveries and canceled or more preceding the end of our fiscal year 2009 that orders. In addition, we purchase components and raw remain unresolved. materials and information technology and other services

ITEM 2. PROPERTIES

The following table outlines the principal facilities we own or lease as of December 31, 2009. Approximate Facility Location Type of Facility Square Footage Owned/Leased Cranes and Related Products Europe/Asia/Africa Wilhelmshaven, Germany Manufacturing/Office and Storage 410,000 Owned/Leased Moulins, France Manufacturing/Office 355,000 Owned/Leased Charlieu, France Manufacturing/Office 323,000 Owned/Leased Presov, Slovak Republic Manufacturing/Office 295,300 Owned Zhangjiagang, China Manufacturing 800,000 Owned Fanzeres, Portugal Manufacturing 183,000 Leased Baltar, Portugal Manufacturing 68,900 Owned Pune, India Manufacturing 190,000 Leased La Clayette, France Manufacturing/Office 161,000 Owned/Leased Niella Tanaro, Italy Manufacturing 370,016 Owned Ecully, France Office 85,000 Owned Alfena, Portugal Office 84,000 Owned Langenfeld, Germany Office/Storage and Field Testing 80,300 Leased Osny, France Office/Storage/Repair 43,000 Owned Decines, France Office/Storage 47,500 Leased Vaux-en-Velin, France Office/Workshop 17,000 Owned Naia, Portugal Manufacturing 17,000 Owned Vitrolles, France Office 16,000 Owned Buckingham, United Kingdom Office/Storage 78,000 Leased Lusigny, France Crane Testing Site 10,000 Owned Baudemont, France Office 8,000 Owned Singapore Office/Storage 49,000 Leased Tai’an, China (Joint Venture) Manufacturing 571,000 Owned Accra, Ghana Office 4,265 Leased Sydney, Australia Office/Storage 21,500 Leased Dubai, United Arab Emirates Office/Workshop 10,000 Leased United States Shady Grove, Pennsylvania Manufacturing/Office 1,278,000 Owned Manitowoc, Wisconsin Manufacturing/Office 570,000 Owned Manitowoc, Wisconsin(2) Office 9,500 Leased Quincy, Pennsylvania Manufacturing 36,000 Owned Bauxite, Arkansas Manufacturing/Office 22,000 Owned Port Washington, Wisconsin Manufacturing 82,000 Owned 14 The Manitowoc Company, Inc. — 2009 Form 10-K

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Approximate Facility Location Type of Facility Square Footage Owned/Leased Foodservice Equipment Europe/Asia Hangzhou, China Manufacturing/Office 260,000 Owned/Leased London, United Kingdom Office 4,600 Leased Eglfing, Germany Manufacturing/Office/Warehouse 130,000 Leased Aldershot, United Kingdom Manufacturing/Office 20,000 Leased Halesowen, United Kingdom Manufacturing/Office 84,000 Leased Sheffield, United Kingdom Manufacturing/Office 100,000 Leased Shanghai, China Manufacturing/Office/Warehouse 62,500 Leased Foshan, China Manufacturing/Office/Warehouse 40,000 Leased Singapore Manufacturing/Office/Warehouse 40,000 Leased Prachinburi, Thailand (Joint Venture) Manufacturing/Office/Warehouse 80,520 Owned Samutprakarn, Thailand (Joint Venture) Office 4,305 Leased North America Manitowoc, Wisconsin Manufacturing/Office 376,000 Owned Parsons, Tennessee(2) Manufacturing 214,000 Owned Sellersburg, Indiana Manufacturing/Office 140,000 Owned La Mirada, California Manufacturing/Office 77,000 Leased Aberdeen, Maryland Manufacturing/Office 67,000 Owned Los Angeles, California Manufacturing/Office 90,000 Leased Los Angeles, California Manufacturing 29,000 Leased Tijuana, Mexico Manufacturing 30,000 Leased New Port Richey, Florida Office/Technology Center 42,000 Owned Goodyear, Arizona Manufacturing/Office 50,000 Leased Columbus, Georgia(1) Manufacturing/Office/Warehouse 540,000 Owned/Leased Fort Wayne, Indiana Manufacturing/Office 358,000 Leased Barbourville, Kentucky Manufacturing/Office 115,000 Owned Shreveport, Louisiana(2) Manufacturing/Office 384,000 Owned Mt. Pleasant, Michigan Manufacturing/Office 330,000 Owned Baltimore, Maryland Manufacturing/Office 16,000 Leased Cleveland, Ohio Manufacturing/Office 180,000 Owned Freeland, Pennsylvania Manufacturing/Office 150,000 Owned Covington, Tennessee Manufacturing/Office 188,000 Owned Piney Flats, Tennessee Manufacturing/Office 110,000 Leased Fort Worth, Texas Manufacturing/Office 183,000 Leased Concord, Ontario, Canada Manufacturing/Office 116,000 Leased Mississauga, Ontario, Canada Manufacturing/Office 155,000 Leased Corporate Manitowoc, Wisconsin Office 34,000 Owned Manitowoc, Wisconsin Office 5,000 Leased Manitowoc, Wisconsin Hangar Ground Lease 31,320 Leased

(1) There are three separate locations within Parsons, Tennessee and Columbus, Georgia. (2) There are two separate locations within Parsons, Tennessee; Shreveport, Louisiana; and Manitowoc, Wisconsin.

In addition, we lease sales office and warehouse space for Shanghai, China; Monterrey, Mexico; Sao Paulo, Brazil; our Crane segment in Breda, The Netherlands; Begles, Barueri, Brazil; Santiago, Chile; and North Las Vegas, Nevada. France; Lille, France; Nantes, France; Toulouse, France; Nice, We lease office and warehouse space for our Foodservice France; Orleans, France; Persans, France; Parabiago, Italy; segment in Salem, Virginia; Irwindale, California; Goodyear, Lagenfeld, Germany; Munich, Germany; Budapest, Hungary; Arizona; Miami, Florida; Paris, France; Fleury Merogis, France; Warsaw, Poland; Melbourne, Australia; Brisbane, Australia; Herborn, Germany; Moscow, Russia; Belgium, Netherlands; Beijing, China; Guangzhou, China; Xi’an, China; Dubai, UAE; Kuala Lumpur, Malaysia; Barcelona, Spain; Naucalpan de Makati City, Philippines; Cavite, Philippines; Harayana, India; Juarez, Mexico; Langley, United Kingdom; and Ecully, France. New Delhi, India; Hyderabad, India; Seoul, Korea; Moscow, We also own sales offices and warehouse facilities for our Russia; Netvorice, the Czech Republic; Manitowoc, Wisconsin; Crane segment in Dole, France and Rouen, France.

The Manitowoc Company, Inc. — 2009 Form 10-K 15

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See Note 21, “Leases,” to the Consolidated Financial and regulations, and to protect the environment and our Statements included in Item 8 of this Form 10-K for addi- workers. We believe we are in substantial compliance with tional information regarding leases. such laws and regulations and we maintain procedures designed to foster and ensure compliance. However, we ITEM 3. LEGAL PROCEEDINGS have been and may in the future be subject to formal or informal enforcement actions or proceedings regarding non- Our global operations are governed by laws addressing the compliance with such laws or regulations, whether or not protection of the environment and employee safety and determined to be ultimately responsible in the normal health. Under various circumstances, these laws impose course of business. Historically, these actions have been civil and criminal penalties and fines, as well as injunctive resolved in various ways with the regulatory authorities with- and remedial relief, for noncompliance. They also may out material commitments or penalties to the company. require remediation at sites where company related sub- For information concerning other contingencies and stances have been released into the environment. uncertainties, see Note 17, “Contingencies and Significant We have expended substantial resources globally, both Estimates,” to the Consolidated Financial Statements financial and managerial, to comply with the applicable laws included in Item 8 of this Form 10-K.

Executive Officers of the Registrant Each of the following officers of the company has been elected by the Board of Directors. The information presented is as of March 1, 2010.

Principal Position Name Age Position With The Registrant Held Since Glen E. Tellock 49 Chairman and Chief Executive Officer 2009

Carl J. Laurino 48 Senior Vice President and Chief Financial Officer 2004

Thomas G. Musial 58 Senior Vice President of Human Resources and Administration 2000

Maurice D. Jones 50 Senior Vice President, General Counsel and Secretary 2004

Dean J. Nolden 41 Vice President of Finance and Treasurer 2005

Eric P. Etchart 53 Senior Vice President of the Company and President Crane Segment 2007

Michael J. Kachmer 51 Senior Vice President of the Company and President Foodservice Segment 2007

Glen E. Tellock has been the company’s chief executive Thomas G. Musial has been senior vice president of human officer since May 2007 and was elected as chairman of the resources and administration since 2000. Previously, he was board effective February 13, 2009. He previously served as vice president of human resources and administration (1995), the senior vice president of The Manitowoc Company, Inc. manager of human resources (1987), and personnel/industrial and president and general manager of the Crane segment relations specialist (1976). since 2002. Earlier, he served as the company’s senior vice Maurice D. Jones has been general counsel and secretary president and chief financial officer (1999), vice president of since 1999 and was elected vice president in 2002 and a finance and treasurer (1998), corporate controller (1992) and senior vice president in 2004. Prior to joining the company, director of accounting (1991). Prior to joining the company, Mr. Jones was a shareholder in the law firm of Davis and Mr. Tellock served as financial planning manager with the Kuelthau, S.C., and served as legal counsel for Banta Denver Post Corporation, and as an audit manager for Corporation. Ernst & Whinney. Dean J. Nolden was named vice president of finance and Carl J. Laurino was named senior vice president and chief treasurer in May 2009. He previously served as the vice financial officer in May 2004. He had served as Treasurer since president and assistant treasurer since 2005. Mr. Nolden May 2001. Mr. Laurino joined the company in January 2000 as joined the company in November 1998 as corporate con- assistant treasurer and served in that capacity until his promo- troller and served in that capacity until his promotion to Vice tion to treasurer. Previously, Mr. Laurino spent 15 years in the President Finance and Controller in May 2004. Prior to join- commercial banking industry with Firstar Bank (n/k/a US Bank), ing the company, Mr. Nolden spent eight years in public Norwest Bank (n/k/a Wells Fargo), and Associated Bank. accounting in the audit practice of PricewaterhouseCoopers During that period, Mr. Laurino held numerous positions of LLP. He left that firm in 1998 as an audit manager. increasing responsibility including commercial loan officer with Eric P. Etchart was named senior vice president of The Norwest Bank, Vice President — Business Banking with Manitowoc Company, Inc. and president and general man- Associated Bank and Vice President and Commercial Banking ager of the Manitowoc Crane segment in May 2007. Manager with Firstar. Mr. Etchart previously served as executive vice president of

16 The Manitowoc Company, Inc. — 2009 Form 10-K

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the Crane segment for the Asia/Pacific region since 2002. unanimously adopted a resolution switching the company’s Prior to joining the company, Mr. Etchart served as manag- quarterly common stock cash dividend to an annual common ing director in the Asia/Pacific region for Potain S.A., as man- stock cash dividend. Beginning in October 2010, and in its aging director in Italy for Potain S.P.A. and as vice president regular fall meetings each year thereafter, the Board of of international sales and marketing for PPM. Directors will determine the amount, if any, and timing of Michael J. Kachmer joined the company in February of the annual dividend for that year. In the years ended 2007 as senior vice president of The Manitowoc Company, December 31, 2009 and 2008, the company paid a quarterly Inc. and president and general manager of the Foodservice dividend of $0.02 in cash for each quarter for a cumulative segment. Prior to joining the company, Mr. Kachmer held dividend of $0.08 per share in 2009 and 2008. In the year executive positions for Culligan International Company since ended December 31, 2007, the company paid a quarterly div- 2000, most recently serving as its chief operating officer. In idend of $.0175 (adjusted for the stock split in September of addition, Mr. Kachmer has held executive and operational 2007) in cash the first two quarters and paid a quarterly divi- roles in a number of global manufacturing companies, dend of $0.02 in cash in each of the last two quarters for a including Ball Corporation and Firestone Tire & Rubber. cumulative dividend in 2007 of $0.075 per share. On July 26, 2007, the Board of Directors authorized a two- ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY for-one split of the company’s common stock. Record hold- AND RELATED STOCKHOLDER MATTERS ers of Manitowoc’s common stock at the close of business on August 31, 2007 received on September 10, 2007 one The company’s common stock is traded on the New York additional share of common stock for every share of Mani- Stock Exchange under the symbol MTW. At December 31, towoc common stock they owned as of August 31, 2007. 2009, the approximate number of record shareholders of Manitowoc shares outstanding at the close of business on common stock was 3,470. August 31, 2007 totaled 62,787,642. The company’s com- The amount and timing of the quarterly dividend is mon stock began trading at its post-split price at the begin- determined by the Board of Directors at its regular meetings ning of trading on September 11, 2007. each year. On October 26, 2009, the Board of Directors

The high and low sales prices of the common stock were as follows for 2009, 2008 and 2007 (amounts have been adjusted for the two-for-one stock split discussed above):

Year Ended 2009 2008 2007 December 31 High Low Close High Low Close High Low Close 1st Quarter $10.19 $2.42 $3.27 $48.90 $30.07 $40.80 $32.64 $25.67 $31.77 2nd Quarter 7.79 3.45 5.26 45.47 30.82 32.53 42.20 31.45 40.19 3rd Quarter 10.45 4.39 9.47 32.00 15.01 15.55 44.96 32.96 44.28 4th Quarter 11.63 8.14 9.97 15.90 4.56 8.66 51.49 37.50 48.83

Under our current bank credit agreement, we are limited leverage ratio is greater than or equal to 2.00 to 1.00 but less on the amount of dividends we may pay out in any one year. than 3.00 to 1.00, payments cannot exceed $35.0 million per The amount of dividend payments is restricted based on our year. If the consolidated total leverage ratio is greater than or consolidated total leverage ratio as defined in the credit equal to 3.00 to 1.00 but less than 4.00 to 1.00, total agreement and is limited along with other restricted pay- restricted payments cannot exceed $20.0 million in a year. ments in aggregate. If the consolidated leverage ratio is less Lastly, if the consolidated total leverage ratio is greater than than 2.00 to 1.00, total restricted payments cannot exceed or equal to 4.00 to 1.00, total restricted payments are limited $75.0 million in any given year. If the consolidated total to $10.5 million per year.

The Manitowoc Company, Inc. — 2009 Form 10-K 17

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Comparison of Cumulative Five-year Total Return

$600

$500

$400

$300

$200

$100

$0 2004 2005 2006 2007 2008 2009

The Manitowoc Company, Inc. S&P 500 Index S&P 600 Industrial Machinery Index

Total Return to Shareholders (Includes reinvestment of dividends)

Annual Return Percentages Years Ending December 31, 2005 2006 2007 2008 2009 The Manitowoc Company, Inc. 34.24% 137.37% 64.65% (82.19)% 16.77% S&P 500 Index 4.91% 15.79% 5.49% (37.00)% 26.46% S&P 600 Industrial Machinery 9.20% 20.77% 12.18% (32.86)% 18.68%

Indexed Returns Years Ending December 31, 2004 2005 2006 2007 2008 2009 The Manitowoc Company, Inc. 100.00 134.24 318.63 524.64 93.45 109.12 S&P 500 Index 100.00 104.91 121.48 128.16 80.74 102.11 S&P 600 Industrial Machinery 100.00 109.20 131.89 147.95 99.33 117.88

18 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: 35779-2_shareholders_k_line.eps V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 18 CHKSUM Content: 31605 Layout: 37586 Graphics: No Graphics CLEAN

ITEM 6. SELECTED FINANCIAL DATA years ended December 31, 2008 and 2009, have been classified as discontinued in the Consolidated Financial State- The following selected historical financial data have been ments to exclude the results from continuing operations. In derived from the Consolidated Financial Statements of The addition, the earnings (loss) from discontinued operations Manitowoc Company, Inc. The data should be read in con- include the impact of adjustments to certain retained liabili- junction with these financial statements and “Management’s ties for operations sold or closed in periods prior to those Discussion and Analysis of Financial Condition and Results of presented. For businesses acquired during the time periods Operations.” Results of the Marine segment in the current presented, results are included in the table from their acqui- and prior periods and the results of substantially all Enodis sition date. Amounts are in millions except share and per ice businesses and certain Enodis non-ice businesses in the share data.

2009 2008 2007 2006 2005 2004 Net Sales Cranes and Related Products $ 2,285.0 $ 3,882.9 $ 3,245.7 $ 2,235.4 $ 1,628.7 $ 1,248.5 Foodservice Equipment 1,497.6 620.1 438.3 415.4 399.6 377.2 Total 3,782.6 4,503.0 3,684.0 2,650.8 2,028.3 1,625.7 Gross Profit 824.6 1,015.8 861.5 611.3 413.2 330.8 Earnings (Loss) from Operations Cranes and Related Products 145.0 555.6 470.5 280.6 115.5 57.0 Foodservice Equipment 174.3 56.8 61.3 56.2 54.9 55.7 Corporate (44.4) (51.7) (48.2) (42.4) (24.8) (21.2) Amortization expense (39.5) (11.6) (5.8) (3.3) (3.1) (3.1) Gain on sales of parts line — — 3.3 — — — Goodwill impairment (548.8) — — — — — Intangible asset impairment (151.2) — — — — — Restructuring expense (39.6) (21.7) — — — — Integration expense (3.6) (7.6) — — — — Loss on sale of product lines (3.4) — — — — — Pension settlements — — (5.3) — — — Total (511.2) 519.8 475.8 291.1 142.5 88.4 Interest expense (174.0) (51.6) (35.1) (44.9) (51.7) (53.4) Amortization of deferred financing fees (28.8) (2.5) (1.1) (1.4) (2.1) (2.6) Loss on debt extinguishment (9.2) (4.1) (12.5) (14.4) (9.1) (1.0) Loss on purchase price hedges — (379.4) — — — — Other income (expense) — net 17.8 (3.0) 9.8 3.4 3.4 (0.8) Earnings (loss) from continuing operations before income taxes (705.4) 79.2 436.9 233.8 83.0 30.6 Provision (benefit) for taxes on income (58.8) (19.2) 122.1 74.8 16.6 5.8 Earnings (loss) from continuing operations (646.6) 98.4 314.8 159.0 66.4 24.8 Discontinued operations: Earnings (loss) from discontinued operations, net of income taxes (35.9) (143.4) 21.9 7.2 (6.4) 13.1 Gain (loss) on sale or closure of discontinued operations, net of income taxes (24.2) 53.1 — — 5.8 1.2 Net earnings (loss) $ (706.7) $ 8.1 $ 336.7 $ 166.2 $ 65.8 $ 39.1 Less: Net earnings (loss) attributable to noncontrolling interest, net of tax 2.5 (1.9) — — — — Net earnings (loss) attributable to Manitowoc (704.2) 10.0 336.7 166.2 65.8 39.1 Amounts attributable to the Manitowoc common shareholders: Earnings (loss) from continuing operations (644.1) 100.3 314.8 159.0 66.4 24.8 Earnings (loss) from discontinued operations, net of income taxes (35.9) (143.4) 21.9 7.2 (6.4) 13.1 Gain (loss) on sale or closure of discontinued operations, net of income taxes (24.2) 53.1 — — 5.8 1.2 Net earnings (loss) attributable to Manitowoc $ (704.2) $ 10.0 $ 336.7 $ 166.2 $ 65.8 $ 39.1 Cash Flows Cash flow from operations $ 338.6 $ 309.0 $ 244.0 $ 293.0 $ 106.7 $ 57.0 Identifiable Assets Cranes and Related Products $ 1,738.4 $ 2,223.7 $ 1,958.0 $ 1,572.4 $ 1,224.7 $ 1,279.7 Foodservice Equipment 2,279.5 3,389.4 341.5 340.1 313.2 302.9 Corporate 260.8 473.0 571.9 307.0 423.9 345.5 Total $ 4,278.7 $ 6,086.1 $ 2,871.4 $ 2,219.5 $ 1,961.8 $ 1,928.1 Long-term Obligations $ 2,180.0 $ 2,597.5 $ 272.0 $ 264.3 $ 474.0 $ 512.2 Depreciation Cranes and Related Products $ 55.3 $ 66.3 $ 70.4 $ 58.4 $ 51.8 $ 42.9 Foodservice Equipment 33.5 12.4 8.0 7.2 6.1 4.9 Corporate 2.8 1.5 1.8 1.8 1.5 1.4 Total $ 91.6 $ 80.2 $ 80.2 $ 67.4 $ 59.4 $ 49.2 Capital Expenditures Cranes and Related Products 51.5 129.4 103.7 51.3 32.9 24.2 Foodservice Equipment 18.4 10.9 3.7 10.9 16.9 11.8 Corporate 2.6 10.0 5.4 2.2 1.0 2.9 Total $ 72.5 $ 150.3 $ 112.8 $ 64.4 $ 50.8 $ 38.9

The Manitowoc Company, Inc. — 2009 Form 10-K 19

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 19 CHKSUM Content: 20097 Layout: 37857 Graphics: No Graphics CLEAN

2009 2008 2007 2006 2005 2004 Per Share Basic earnings (loss) per common share: Earnings (loss) from continuing operations attributable to Manitowoc common shareholders $ (4.94) $ 0.77 $ 2.53 $ 1.30 $ 0.55 $ 0.23 Earnings (loss) from discontinued operations attributable to Manitowoc common shareholders (0.28) (1.10) 0.18 0.06 (0.05) 0.12 Gain (loss) on sale or closure of discontinued operations, net of income taxes (0.19) 0.41 — — 0.05 0.01 Earnings (loss) per share attributable to Manitowoc common shareholders $ (5.41) $ 0.08 $ 2.70 $ 1.36 $ 0.55 $ 0.36 Diluted earnings (loss) per common share: Earnings (loss) from continuing operations attributable to Manitowoc common shareholders $ (4.94) $ 0.76 $ 2.47 $ 1.27 $ 0.54 $ 0.23 Earnings (loss) from discontinued operations attributable to Manitowoc common shareholders (0.28) (1.09) 0.17 0.06 (0.06) 0.12 Gain (loss) on sale or closure of discontinued operations, net of income taxes (0.19) 0.40 — — 0.05 0.01 Earnings (loss) per share attributable to Manitowoc common shareholders $ (5.41) $ 0.08 $ 2.64 $ 1.32 $ 0.53 $ 0.36 Avg Shares Outstanding Basic 130,268,670 129,930,749 124,667,931 122,449,148 120,586,420 107,602,520 Diluted 130,268,670 131,630,215 127,489,416 125,571,532 123,052,068 109,508,720

1) Discontinued operations represent the results of operations and gain or loss on sale or closure of the Marine segment, substantially all Enodis ice businesses and certain Enodis non-ice businesses, Delta Manlift SAS, DRI and Toledo Ship Repair, which either qualified for discontinued operations treatment, or were sold or closed during 2009, 2008, 2005, or 2004. 2) On July 26, 2007, the Board of Directors authorized a two-for-one split of the company’s common stock. Record holders of Manitowoc’s common stock at the close of business on August 31, 2007 received on September 10, 2007 one additional share of common stock for every share of Manitowoc common stock they owned as of August 31, 2007. Manitowoc shares outstanding at the close of business on August 31, 2007 totaled 62,787,642. The company’s common stock began trading at its post-split price at the beginning of trading on September 11, 2007. Per share, share and stock option amounts within this Annual Report on Form 10-K for all periods presented have been adjusted to reflect the stock split. 3) We acquired two businesses during 2008, two businesses during 2007, and two businesses during 2006. 4) Cash dividends per share for 2004 through 2009 were as follows: $0.07 (2004 through 2006), $0.075 (2007), and $0.08 (2008 and 2009).

20 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 20 CHKSUM Content: 43748 Layout: 13348 Graphics: No Graphics CLEAN

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS 2008 earnings per diluted share of $0.16. There was no OF FINANCIAL CONDITION AND RESULTS OF impact to the 2008 cash flows from operating activities as OPERATIONS the increase in net earnings was offset by the increase in refundable income taxes. The following discussion and analysis should be read in con- We do not believe that the adjustments to the provision junction with the consolidated financial statements and for income taxes, refundable income taxes, and retained related notes appearing in Item 8 of the Annual Report on earnings described above are material to the company’s Form 10-K. results of operations, financial position or cash flows for any of the company’s previously filed annual or quarterly Overview The Manitowoc Company, Inc. is a multi-industry, financial statements. Accordingly, the December 31, 2008 capital goods manufacturer in two principal markets: Cranes financial statements included herein have been revised to and Related Products (Crane) and Foodservice Equipment reflect the adjustment to income tax expense, refundable (Foodservice). Crane is recognized as one of the world’s income taxes and retained earnings discussed above. leading providers of lifting equipment for the global con- During the fourth quarter of 2009 the company identified struction industry, including lattice-boom cranes, tower adjustments to correct an error to the amortization of cranes, mobile telescopic cranes, and boom trucks. Food- deferred financing fees that reduce the expenses recog- service is one of the world’s leading innovators and manu- nized in the most recently filed Quarterly Reports for each of facturers of commercial foodservice equipment serving the the first three quarters of 2009 by $0.4 million, $5.8 million, ice, beverage, refrigeration, food preparation, and cooking and $5.0 million, respectively. The net of tax effect of these needs of restaurants, convenience stores, hotels, health- adjustments increases the company’s previously reported care, and institutional applications. 2009 earnings per share by $0.00, $0.03, and $0.02 for the In order to secure clearance for the acquisition of Enodis quarters ended March 31, June 30 and September 30, from various regulatory authorities including the European respectively. These adjustments increased the unamortized Commission and the United States Department of Justice, portion of deferred financing fees included in long term Manitowoc agreed to sell substantially all of Enodis’ global ice assets by $11.2 million, increased income taxes payable and machine operations following completion of the transaction. deferred tax liabilities by $4.3 million, and increased retained On May 15, 2009, the company completed the sale of the earnings by $6.9 million as of September 30, 2009. Enodis global ice machine operations to Braveheart Acquisi- There was no impact to quarterly cash flows in 2009 as the tion, Inc., an affiliate of Warburg Pincus Private Equity X, L.P., increase in net earnings was offset by the decrease in the for $160 million. The businesses sold were operated under non-cash reconciling items for deferred financing fee amorti- the Scotsman, Ice-O-Matic, Simag, Barline, Icematic, and Oref zation and deferred taxes. The company does not believe that brand names. The company also agreed to sell certain non-ice these adjustments are material to the results of operations, businesses of Enodis located in Italy that are operated under financial position or cash flows for any of its previously filed the Tecnomac and Icematic brand names. Prior to disposal, quarterly financial statements. Accordingly, the company will the antitrust clearances required that the ice businesses were revise its 2009 quarterly financial statements prospectively treated as standalone operations, in competition with Mani- within its 2010 Quarterly Reports on Form 10-Q. towoc. The results of these operations have been classified The following discussion and analysis covers key drivers as discontinued operations. See further detail related to these behind our results for 2007 through 2009 and is broken businesses at Note 4, “Discontinued Operations.” down into three major sections. First, we provide an During the quarter ended September 30, 2009, the com- overview of our results of operations for the years 2007 pany identified an adjustment to the income tax provision through 2009 on a consolidated basis and by business seg- that should have been included in its previously filed finan- ment. Next we discuss our market conditions, liquidity and cial statements on Form 10-K for the year ended capital resources, off balance sheet arrangements, and obli- December 31, 2008. The issue was discovered during the gations and commitments. Finally, we provide a discussion process of reconciling the income tax provision in the finan- of risk management techniques, contingent liability issues, cial statements to the 2008 income tax return and the critical accounting policies, impacts of future accounting required adjustment resulted in a decrease in income tax changes, and cautionary statements. expense, an increase in refundable income taxes and an All dollar amounts, except per share amounts, are in increase in retained earnings of $20.7 million, which has millions of dollars throughout the tables included in this been reflected in the accompanying financial statements, for Management’s Discussion and Analysis of Financial Condi- the year ended December 31, 2008. The adjustment also tions and Results of Operations unless otherwise indicated. resulted in an increase to the company’s previously reported

The Manitowoc Company, Inc. — 2009 Form 10-K 21

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 21 CHKSUM Content: 14134 Layout: 42550 Graphics: No Graphics CLEAN

Results of Consolidated Operations

Year Ended December 31, 2009 Compared to 2008 ended December 31, 2008. Further analysis of the changes Consolidated net sales decreased 16.0% in 2009 to $3.8 billion in sales by segment is presented in the Sales and Operating from $4.5 billion in 2008. This decrease was the result of lower Earnings by Segment section below. year-over-year sales in the Crane segment primarily due to the Gross profit decreased for the year ended December 31, global macro-economic downturn as well as a broad global 2009 to $824.6 million compared to $1.0 billion for the year credit crisis in the banking industry. Partially offsetting the ended December 31, 2008, a decrease of 18.8%. Gross mar- lower consolidated net sales was higher sales in the Food- gin decreased in 2009 to 21.8% from 22.6% in 2008. The service segment as a result of additional revenue related to decrease in consolidated gross profit was driven by the businesses acquired in the Enodis acquisition during the Crane segment as a result of decreased sales volumes fourth quarter of 2008. Sales in our Crane segment across all regions, increased manufacturing unabsorbed decreased 41.2% for the year ended December 31, 2009 overhead costs and an unfavorable translation effect of for- compared to 2008. The weaker foreign currencies as com- eign currency exchange rate changes. This decrease was pared to the U.S. Dollar had an unfavorable impact on con- partially offset by higher Foodservice gross profit due to the solidated net sales of approximately $168.4 million or 4.5% inclusion of Enodis and various cost reduction initiatives in for the year ended December 31, 2009 compared to the year both segments during 2009. The decrease in gross margin

22 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 22 CHKSUM Content: 48868 Layout: 55809 Graphics: No Graphics CLEAN

occurred primarily as a result of lower sales volumes in the significant estimates and assumptions. These estimates and Crane segment partially offset by higher gross margin in the assumptions primarily include, but are not limited to, projec- Foodservice segment due to cost reductions and pricing tions of revenue growth, operating earnings, discount rates, actions. In addition, the strength in the U.S. Dollar resulted in terminal growth rates, and required capital for each report- a decrease in gross profit of approximately $25.0 million or ing unit. Due to the inherent uncertainty involved in making 3.0% for the year ended December 31, 2009. these estimates, actual results could differ materially from Engineering, selling and administrative (ES&A) expenses for the estimates. The company evaluated the significant the year ended December 31, 2009 increased approximately assumptions used to determine the fair value of each report- $94.6 million to $549.7 million compared to $455.1 million for ing unit, both individually and in the aggregate, and con- the year ended December 31, 2008. This increase was driven cluded they were reasonable. by higher expenses in the Foodservice segment as a result of The results of the analysis indicated that the fair values of including the Enodis ES&A expenses but was partially offset three of the company’s eight reporting units (Foodservice by lower Crane segment and Foodservice segment ES&A Americas; Foodservice Europe, Middle East, and Africa; and expenses due to lower employee related costs and other Foodservice Retail) were potentially impaired, and therefore, discretionary spending reductions and realization of synergies the company proceeded to measure the amount of the associated with the Enodis integration. The strength of the potential impairment with the assistance of a third-party valu- U.S. Dollar resulted in a decrease in ES&A expenses of ation firm. Upon completion of that assessment, the com- approximately $17.7 million for the year ended December 31, pany recognized impairment charges as of March 31, 2009 of 2009 compared to the year ended December 31, 2008. $548.8 million related to goodwill. The company also recog- Amortization expense for the year ended December 31, nized impairment charges of $151.2 million related to other 2009 was $39.5 million compared to $11.6 million for 2008 indefinite-lived intangible assets as of March 31, 2009. Both primarily as a result of the additional intangible assets charges were within the Foodservice segment. These non- acquired from Enodis (see further detail related to the intan- cash impairment charges have no direct impact on the com- gible assets at Note 3, “Acquisitions”). pany’s cash flows, liquidity, debt covenants, debt position or The company accounts for goodwill and other intangible tangible asset values. There is no tax benefit in relation to the assets under the guidance of Accounting Standards Codifica- goodwill impairment; however, the company did recognize a tion (“ASC”) Topic 350-10, “Intangibles — Goodwill and $52.0 million benefit associated with the other indefinite-lived Other.” Under ASC Topic 350-10, goodwill is no longer amor- intangible asset impairment. tized; however, the company performs an annual impairment In June 2009, the company performed its annual impair- at June 30 of every year or more frequently if events or ment analysis relative to goodwill and indefinite-lived intangi- changes in circumstances indicate that the asset might be ble assets at June 30, 2009 and based on those results the impaired. The company performs impairment reviews for its company determined no additional impairment had occurred reporting units, which are Cranes Americas; Cranes Europe, subsequent to the impairment charges recorded in the first Middle East, and Africa; Cranes Asia; Crane Care; Foodser- quarter of 2009. The company will continue to monitor mar- vice Americas; Foodservice Europe, Middle East, and Africa; ket conditions and determine if any additional interim reviews Foodservice Asia; and Foodservice Retail. In its impairment of goodwill, other intangibles or long-lived assets are war- reviews, the company uses a fair-value method based on the ranted. Further deterioration in the market or actual results as present value of future cash flows, which involves manage- compared with the company’s projections may ultimately ment’s judgments and assumptions about the amounts of result in a future impairment. In the event the company deter- those cash flows and the discount rates used. The estimated mines that assets are impaired in the future, the company fair value is then compared with the carrying amount of the would need to recognize a non-cash impairment charge, reporting unit, including recorded goodwill. Goodwill and which could have a material adverse effect on the company’s other intangible assets are then subject to risk of write-down consolidated balance sheet and results of operations. to the extent that the carrying amount exceeds the estimated The company is engaged in a number of integration activi- fair value. ties associated with the Enodis acquisition. For the years During the first quarter of 2009, the company’s stock price ended December 31, 2009 and December 31, 2008 integra- continued to decline as global market conditions remained tion expenses were $3.6 million and $7.6 million, respec- depressed, the credit markets did not improve and the per- tively. Integration expenses include only costs directly formance of the company’s Crane and Foodservice seg- associated with the integration, such as costs related to out- ments was below the company’s expectations. In side vendors or services, costs of employees who have connection with a reforecast of expected 2009 financial been assigned full-time to integration activities, and travel- results completed in early April 2009, the company deter- related expenses. mined the foregoing circumstances to be indicators of During December 2009, the company sold two product potential impairment under the guidance of ASC Topic lines within its Foodservice segment for aggregate net pro- 350-10. Therefore, the company performed the required ini- ceeds of approximately $15.0 million and recognized an tial impairment test for each of the company’s reporting aggregate loss on the sale of $3.4 million. The two product units as of March 31, 2009. The company re-performed its lines that were divested were the company’s Lincoln Small- established method of present-valuing future cash flows, wares products and most of its Merco product category. The taking into account its updated projections, to determine the Smallwares products were sold to The Vollrath Company, fair value of the reporting units. The determination of fair L.L.C. and included products such as pots, pans, baking value of the reporting units requires the company to make sheets and other cooking implements as well as manual

The Manitowoc Company, Inc. — 2009 Form 10-K 23

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 23 CHKSUM Content: 32588 Layout: 47337 Graphics: No Graphics CLEAN

food preparation equipment (e.g., slicers, peelers). The Therefore, the periodic market value changes in these Merco product category was sold to Hatco Corporation and hedges were required to be recognized in the income state- included food warming equipment, merchandisers, toasters, ment. For the year ended December 31, 2008, the loss on and racking/dispensing systems. The company recorded a currency hedges related to the purchase of Enodis was loss of $3.3 million for the sale of its Smallwares products $379.4 million. and a loss of $0.1 million for the sale of its Merco products. Other income, net for the year ended December 31, 2009 Restructuring expenses for the year ended December 31, was $17.8 million versus a loss of $3.0 million for the prior 2009 totaled $39.6 million which compares to $21.7 million year. The income in 2009 was primarily the result of foreign in 2008. As a result of the continued worldwide decline in currency gains related to transactions between our U.S. and Crane segment sales in 2009, the company recorded foreign crane facilities during the year whereby we benefit- $29.0 million in restructuring charges as it further reduced ted from the U.S. Dollar strengthening against other foreign the Crane segment cost structure in all regions. In addition, currencies and is also partially due to higher interest income. the Foodservice segment recorded restructuring expenses The loss in 2008 was the result of other foreign currency of $10.6 million during the year ended December 31, 2009 in losses partially offset by interest income. connection with closing of its Harford-Duracool facility in The effective tax rate for the year ended December 31, Aberdeen, Maryland in the second quarter and its McCall 2009 was 8.3% as compared to negative 24.2% for the year facility in Parsons, Tennessee in the third quarter. See further ended December 31, 2008. As the company posted a pre- detail related to the restructuring expenses at Note 19, tax loss in 2009, a positive effective tax rate represents a “Restructuring.” benefit to the consolidated statement of operations. In 2008 Interest expenses for the year ended December 31, 2009 the company posted pre-tax income, for which a negative totaled $174.0 million versus $51.6 million for the year ended effective tax rate represents a benefit to the consolidated December 31, 2008. The increase is the result of an additional statement of operations. The goodwill impairment of interest expense related to the $2.4 billion credit agreement $548.8 million in 2009 is not tax deductible and thus had an which was entered into in order to fund the Enodis acquisition unfavorable impact to the effective tax rate. The write-down and which was amended and restated as of August 25, 2008 of the trademarks of $151.2 million had an associated to ultimately increase the size to $2.925 billion (New Credit deferred tax liability of $52.0 million which resulted in no Agreement) and was drawn upon on November 6, 2008. See impact to the effective tax rate for 2009. The income tax further detail on the New Credit Agreement at Note 11, benefit for the year ended December 31, 2009 was favorably “Debt.” Amortization expenses for deferred financing fees impacted by the reversal of various reserves for uncertain was $28.8 million for the year ended December 31, 2009 as tax positions as discussed in Note 13, “Income Taxes.” compared to $2.5 million in 2008. The higher expense in 2009 During 2009, the company determined that it was more is related to the amortization of the fees associated with likely than not that the deferred tax assets would not be uti- entering into the New Credit Agreement. lized in several jurisdictions including China, Slovakia, Spain, The loss on debt extinguishment of $9.2 million for the year and the United Kingdom. Therefore, the company recog- ended December 31, 2009 is a result of the accelerated pay- nized $22.5 million of valuation allowances as income tax down of Term Loan X of $147.9 million by using the proceeds expense. The company generated $97.2 million of net oper- from the sale of the Enodis ice businesses in the second ating loss carryforwards in France during 2009, creating a quarter and the accelerated paydown of Term Loan B of deferred tax asset of $33.2 million. Based upon the cyclical- $150.0 million and Term Loan X of $33.6 million using cash ity of the company’s Crane business, management analyzes from operations in the fourth quarter. For the year ended the ability to utilize these deferred tax assets on a seven December 31, 2008, the company made a cash payment of year cycle, consistent with the Crane business cycles, as $118.5 million to partially pay down the balance of the Term this provides the best information to evaluate the future Loan X from the proceeds of the Marine divestiture and as a profitability of the business unit. At December 31, 2009, the result of this payment, the company incurred a charge of company has concluded that a valuation allowance against $4.1 million. Both charges were recorded in loss on debt extin- the deferred income tax asset for the carryforward is not guishment in the Consolidated Statements of Operations. required to be recognized. However, prior to the complete During July 2008, the company entered into various hedg- utilization of these carryforwards, particularly if the current ing transactions (the “hedges”) to comply with the terms of economic downturn continues and the company generates its New Credit Agreement (see further detail related to the operating losses in its operations in these jurisdictions for an New Credit Agreement at Note 11, “Debt”) issued to fund extended period of time, it is possible the company might the purchase of Enodis. The hedges were required to limit conclude that the benefit of these carryforwards would no the company’s exposure to fluctuations in the underlying longer meet the more-likely-than-not recognition criteria, at purchase Great British Pound (GBP) price of the Enodis which point the company would be required to recognize a shares which could have ultimately required additional fund- valuation allowance against some or all of the tax benefit ing capacity under the New Credit Agreement. Subsequent associated with the carryforwards. The company updates its to entering into the hedging transactions, the U.S. Dollar financial forecast of these operations quarterly and contin- strengthened against the GBP which resulted in a significant ues to closely monitor the utilization of these losses. The change to the fair value of the underlying hedges. Under the recognition of these valuation allowances, if necessary, guidance of ASC Topic 815-10, “Derivatives and Hedging,” could have a material adverse effect on our consolidated hedges of a firm commitment to acquire a business do not balance sheet and results of operations. qualify for hedge accounting (or balance sheet) treatment.

24 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 24 CHKSUM Content: 52301 Layout: 38008 Graphics: No Graphics CLEAN

Both the 2009 and 2008 effective tax rates were also gin decreased from 30.0% in 2007 to 25.2% in 2008. The favorably affected, as compared to the statutory rate, to strength in the Euro currency resulted in an increase on varying degrees by certain global tax planning initiatives. The gross profit of approximately $28.6 million or 2.8% for the effective tax rate in 2008 was favorably affected by the sig- year ended December 31, 2008. nificant decrease in U.S. pre-tax income resulting from the Engineering, selling and administrative (ES&A) expenses loss on currency hedges related to the Enodis acquisition, for the year ended December 31, 2008 increased approxi- and certain global tax planning initiatives that are not mately $77.2 million to $455.1 million compared to impacted by pre-tax income volatility. $377.8 million for the year ended December 31, 2007. This The results from discontinued operations were a loss of increase was driven by higher expenses in the Crane and $35.9 million and a loss of $143.4 million, net of income Foodservice segments and for general corporate expenses. taxes, for the years ended December 31, 2009 and 2008, Crane segment ES&A expense increased due to higher sell- respectively. The 2009 loss relates to the Enodis ice busi- ing expenses, increased costs related to the 2008 and 2007 nesses sold on May 15, 2009 and the final completion of clos- acquisitions, expenses related to the ERP implementation ing and tax adjustments on the results of the discontinued project and the negative impact of the stronger Euro result- operations associated with the disposition of the Marine seg- ing in an additional $10.4 million in expenses. The increase ment sold on December 31, 2008. The 2008 loss relates to in Foodservice segment ES&A expenses were due to the results of operations of the former Marine segment sold approximately two months of additional expenses incurred on December 31, 2008 and the Enodis ice businesses classi- within the Enodis business. fied as held-for-sale at the end of 2008, which included a non- Amortization expense for the year ended December 31, cash impairment charge of $175.0 million. We also realized an 2008 was $11.6 million compared to $5.8 million in 2007 pri- after tax loss of $24.2 million on the sale of the Enodis ice marily as a result of the additional intangible assets from the businesses and the Marine segment as a result of final settle- Enodis acquisition (see further detail related to the intangible ment of working capital and tax adjustments in 2009. The gain assets at Note 3, “Acquisitions.”) Integration expense for the on the sale of discontinued operations of $53.1 million in 2008 year ended December 31, 2008 was $7.6 million and was relates to the sale of our former Marine segment. related to the integration activities associated with the Enodis For the year ended December 31, 2009, a net loss attribut- acquisition. There was no integration expense in 2007. able to a noncontrolling interest of $2.5 million was recorded Restructuring expense for the year ended December 31, in relation to our 50% joint venture with the shareholders of 2008 was $21.7 million compared to no restructuring Tai’An Dongyue Heavy Machinery Co., Ltd. (Tai’An Dongyue). expense in 2007. The restructuring expense was in response There was a net loss of $1.9 million in connection with the to the accelerated decline in demand in Western and South- joint venture for the same period of 2008. See further detail ern Europe where market conditions negatively impacted related to the joint venture at Note 3, “Acquisitions.” our tower crane product sales. The tower crane backlog in Europe declined by almost 80% in 2008. To better align the Year Ended December 31, 2008 Compared to 2007 company’s resources with the demand in Europe the com- Consolidated net sales increased 22.2% in 2008 to $4.5 billion pany committed to a restructuring plan in the fourth quarter from $3.7 billion in 2007. This increase was the result of of 2008 to reduce the cost structure of its French and Por- higher year-over-year sales in the Crane segment and higher tuguese facilities. The plan included workforce reductions of sales in the Foodservice segment as a result of sales from our approximately 350 employees in France and 120 employees newly acquired Enodis business. This business generated net in Portugal. As of December 31, 2008, no significant benefit sales of approximately $179.1 million since its acquisition on payments had been made in connection with such work- October 27, 2008. Sales in our Crane segment increased force reductions. 19.6% for the year ended December 31, 2008 compared to On April 3, 2007, we sold all of our aftermarket replacement 2007. The stronger Euro currency compared to the U.S. Dollar parts and rights to manufacture, sell and service aftermarket had a favorable impact on sales of approximately $154.0 mil- replacement parts for all models of the Grove Manlift aerial lion or 3.4% for the year ended December 31, 2008 compared work platform product line around the world to MinnPar LLC to the year ended December 31, 2007. (MinnPar). We received $4.9 million in proceeds and recog- Gross profit increased for the year ended December 31, nized a gain of $3.3 million, which is recorded in gain on sale 2008 to $1.0 billion compared to $861.5 million for the year of parts line in the Consolidated Statement of Operations for ended December 31, 2007, an increase of 17.9%. Gross the year ended December 31, 2007. margin decreased in 2008 to 22.6% from 23.4% in 2007. During the second quarter of 2007, we made a $15.1 million The increase in consolidated gross profit was driven by both pension contribution to our U.K. defined benefit pension plan. segments as a result of higher sales volumes in the Crane The $15.1 million contribution funded the defined benefit plan segment and the inclusion of gross profit results of the as well as paid an incentive to certain pensioners to transfer Enodis business for two months. The decrease in gross mar- from the defined benefit plan to a defined contribution plan. As gin occurred as a result of higher material costs for both a result of this payment, the company recorded a charge dur- segments. Crane segment gross profit increased in 2008 to ing the second quarter of 2007 of approximately $3.8 million to $856.4 million from $729.4 million in 2007, while gross reflect the incentive given to the pensioners and expenses margin decreased to 22.1% from 22.5% over the same incurred. This charge is recorded in pension settlements in the period. The Foodservice segment’s gross profit increased in Consolidated Statement of Operations for the year ended 2008 to $156.5 million from $131.6 million, while gross mar- December 31, 2007. Subsequent to the funding of the defined

The Manitowoc Company, Inc. — 2009 Form 10-K 25

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benefit pension plan, approximately $39.2 million of assets charge of $12.5 million ($8.1 million net of income taxes) and related liabilities were transferred from the defined benefit related to the call premium, the write-off of unamortized pension plan to a defined contribution pension plan. debt issuance costs and other expenses. The charge was During the second quarter of 2007, we recorded a charge recorded in loss on debt extinguishment in the Consolidated of $1.4 million related to a withdraw liability from a multiem- Statement of Operations. ployer pension plan at our former River Falls, Wisconsin facil- The effective tax rate for the year ended December 31, ity. During the third quarter of 2005, we closed our Kolpak 2008 was a benefit of 24.2% compared to expense of operation located in River Falls, Wisconsin and consolidated 28.0% for the year ended December 31, 2007. The benefit in it with our operation in Tennessee. This charge is recorded in 2008 was the result of a significant decrease in U.S. pre-tax pension settlements in the Consolidated Statement of Opera- income, primarily as a result of the loss on purchase price tions for the year ended December 31, 2007. currency hedges. The effective tax rate in 2007 was lower Interest expense for the year ended December 31, 2008 than the statutory rate as a result of a foreign tax credit car- was $54.1 million versus $36.2 million for the year ended ryforward which was recognized during the second quarter December 31, 2007. The increase was the result of approxi- of 2007 and an IRS audit settlement during the third quarter mately two months of additional interest expense related to of 2007. In addition, all periods were favorably affected, our New Credit Agreement of $2,925.0 million that became compared to the statutory rate, to varying degrees by certain effective on August 25, 2008 and was drawn upon on global tax planning initiatives. November 6, 2008, in order to fund our purchase of Enodis. The results from discontinued operations were a loss of On December 31, 2008, the company made a cash pay- $143.4 million and earnings of $21.9 million, net of income ment of $118.5 million to partially pay down the balance of taxes, for the years ended December 31, 2008 and 2007, the Term Loan X. As of December 31, 2008, the balance of respectively. The 2008 earnings relate to the results of opera- Term Loan X was $181.5 million. As a result of this payment, tions of the former Marine segment sold on December 31, the company incurred a charge of $4.1 million related to the 2008 and the Enodis ice businesses classified as held-for-sale partial write-off of debt issuance costs of $3.3 million and at year-end which included a non-cash impairment charge of the write off of other deferred financing fees totaling $175.0 million. The 2007 earnings from discontinued opera- $0.8 million. The charge was recorded in loss on debt extin- tions relate to the results of operations from the Marine seg- guishment in the Consolidated Statements of Operations. ment and to the favorable product liability experience related During July 2008, the company entered into various hedg- to our discontinued Manlift business which was sold in 2004. ing transactions (the “hedges”) to comply with the terms of We also realized an after tax gain on the sale of our former its New Credit Agreement (see further detail related to the Marine segment of $53.1 million during 2008. New Credit Agreement at Note 11, “Debt”) issued to fund For the year ended December 31, 2008, a net loss attribut- the purchase of Enodis. The hedges were required to limit able to a noncontrolling interest of $1.9 million was recorded the company’s exposure to fluctuations in the underlying in relation to our 50% joint venture formed on March 6, 2008 Great British Pound (GBP) purchase price of the Enodis with the shareholders of Tai’An Dongyue. See further detail shares which could have ultimately required additional fund- related to the joint venture at Note 3, “Acquisitions.” ing capacity under the New Credit Agreement. Subsequent to entering into the hedging transactions, the U.S. Dollar Sales and Operating Earnings by Segment strengthened against the GBP which resulted in a significant Operating earnings reported below by segment include the change to the fair value of the underlying hedges. Under the impact of reductions due to restructurings and plant consoli- guidance of ASC Topic 815-10, “Derivatives and Hedging,” dation costs, whereas these expenses were separately identi- hedges of a firm commitment to acquire a business do not fied in the Results of Consolidated Operations table above. qualify for hedge accounting (or balance sheet) treatment. Therefore, the periodic market value changes in these Cranes and Related Products Segment hedges were required to be recognized in the income statement. For the year ended December 31, 2008, the loss on 2009 2008 2007 currency hedges related to the purchase of Enodis was Net sales $2,285.0 $3,882.9 $3,245.7 $379.4 million. Other income, net for the year ended December 31, 2008, Operating earnings $ 145.0 $ 555.6 $ 470.5 was a loss of $3.0 million versus a gain of $9.8 million for Operating margin 6.3% 14.3% 14.5% the prior year. The loss in 2008 was the result of other foreign currency losses of $14.0 million, offset by interest Year Ended December 31, 2009 Compared to 2008 income of $11.0 million, which was higher than the 2007 Crane segment net sales for the year ended December 31, interest income of $8.4 million due to higher cash balances 2009 decreased 41.2% to $2.3 billion versus $3.9 billion for throughout 2008 versus 2007. the year ended December 31, 2008. Net sales for the year 1 On August 1, 2007, we redeemed our 10 ⁄2% senior ended December 31, 2009 decreased over the prior year in all subordinated notes due 2012. Pursuant to the terms of the major geographic regions and in all product lines. As of indenture, we paid the note holders 105.25% of the principal December 31, 2009, total Crane segment backlog was amount plus accrued and unpaid interest up to the redemp- $572.7 million, a 70.6% decrease compared to the tion date. The total cash payment for the redemption was December 31, 2008 backlog of $1.9 billion and a 14.0% $129.6 million. As a result of this redemption, we incurred a decrease versus the September 30, 2009 backlog of

26 The Manitowoc Company, Inc. — 2009 Form 10-K

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$666.3 million. The Crane segment backlog stabilized and impact of a stronger Euro currency as compared to the declined at a much slower pace during the fourth quarter as U.S. Dollar for the majority of 2008. Operating margin for the the trend in new orders, net of cancellations, continued to year ended December 31, 2008 was 14.3% versus 14.5% show improvement since late in 2008. for the year ended December 31, 2007. Higher material costs For the year ended December 31, 2009, the Crane seg- and softening sales of our higher margin product lines in the ment reported operating earnings of $145.0 million com- fourth quarter contributed to the decline in operating margin. pared to $555.6 million for the year ended December 31, To better align the company’s resources with the current 2008. Operating earnings of the Crane segment were unfa- demand in Europe the company committed to a restructur- vorably affected by lower sales volumes, lower factory effi- ing plan in the fourth quarter of 2008 to reduce the cost ciencies and an unfavorable translation effect of foreign structures of its French and Portuguese facilities. The plan currency exchange rate changes partially offset by favorable included workforce reductions of approximately 350 employ- reductions in ES&A expenses, favorable factory cost reduc- ees in France and 120 employees in Portugal. During 2008, tions and favorable pricing actions. Operating margin for the the company recorded $21.7 million in expense associated year ended December 31, 2009 was 6.3% versus 14.3% for with involuntary employee terminations and related costs. the year ended December 31, 2008. The steep drop in sales volumes compared to the prior year was the primary contrib- Foodservice Equipment Segment utor to the decline in operating margin in 2009 versus 2008. This decline was partially offset by lower ES&A expenses of 2009 2008 2007 $229.4 million for the year ended December 31, 2009 which Net sales $1,497.6 $620.1 $438.3 was $69.9 million lower than the $299.3 million of ES&A Operating earnings $174.3 $ 56.8 $ 61.3 expenses for the year ended December 31, 2008. In the fourth quarter of 2008, the company committed to a Operating margin 11.6% 9.2% 14.0% restructuring plan to better align the company’s resources with the global crane demand and recorded a $21.7 million Year Ended December 31, 2009 Compared to 2008 restructuring expense associated with involuntary employee Foodservice segment net sales increased 141.5% or terminations and related costs in France and Portugal. Dur- $877.5 million to $1.5 billion for the year ended December 31, ing 2009, as a result of the continued worldwide decline in 2009 compared to $620.1 million for the year ended Crane segment sales, the company recorded an additional December 31, 2008. The sales increase during 2009 was $29.0 million in restructuring charges to further reduce the driven by $1.1 billion in net sales during 2009 from the busi- Crane segment cost structure in all regions. nesses acquired in connection with the Enodis acquisition versus $179.1 million from the same businesses for the last Year Ended December 31, 2008 Compared to 2007 two months of 2008 as a result of the Enodis acquisition at Crane segment net sales for the year ended December 31, the end of October 2008. Excluding the sales from the busi- 2008 increased 19.6% to $3.9 billion versus $3.2 billion for the nesses acquired in connection with the Enodis acquisition, year ended December 31, 2007. Net sales for the year ended sales would have decreased by 20.5% for the year ended December 31, 2008 increased over the prior year in all of our December 31, 2009 compared to the same period in 2008. major geographic regions. The Crane segment benefited from On an adjusted basis to include full year 2008 sales from the a strong crane end-market demand during the first nine businesses acquired in connection with the Enodis acquisi- months of 2008 compared to the same period of 2007. Due to tion, sales were lower by $311.6 million in 2009 as com- the slowing world economy, the lower demand for cranes, pared to 2008 due to the extended contraction of capital especially for tower cranes, during the last 3 months of 2008 spending by the restaurant industry. This revenue decline was lower than the same period in 2007. From a product line was also partially due to the negative impact of a stronger standpoint, the sales increase was driven by increased U.S. Dollar relative to the Euro and British Pound currencies volumes of crawler, tower and mobile hydraulic cranes world- of approximately $43.8 million. wide, and increases in our aftermarket sales and service busi- For the year ended December 31, 2009, the Foodservice ness, slightly offset by decreased sales of our boom truck segment reported operating earnings of $174.3 million com- cranes in North America due to the continued soft residential pared to $56.8 million for the year ended December 31, housing construction market. As of December 31, 2008, total 2008. The operating earnings increase was driven by the Crane segment backlog was $1.9 billion, a 32.3% decrease as inclusion of $122.8 million during 2009 from the businesses compared to the December 31, 2007 backlog of $2.9 billion acquired in connection with the Enodis acquisition versus and a 41.5% decrease versus the September 30, 2008 backlog the operating earnings loss of $3.7 million from the same of $3.3 billion. businesses during the last two months of 2008. Operating For the year ended December 31, 2008, the Crane seg- earnings in 2009 for the legacy Manitowoc Foodservice busi- ment reported operating earnings of $555.6 million com- nesses, as compared to 2008, were lower by $9.7 million. pared to $470.5 million for the year ended December 31, On an adjusted basis, operating earnings were higher by 2007. Operating earnings of the Crane segment were favor- $5.5 million in 2009 as compared to 2008 primarily due to ably affected by increased volume across all regions and all the effective implementation of cost control measures and product lines except for boom trucks, appropriate product the realization of synergies from the integration of the busi- price increases, and product cost takeout initiatives. These nesses acquired in connection with the Enodis acquisition. results were partially offset by product cost increases and higher administrative costs due in part to the unfavorable

The Manitowoc Company, Inc. — 2009 Form 10-K 27

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Year Ended December 31, 2008 Compared to 2007 believe that we have demonstrated that we can quickly Foodservice segment net sales increased 41.5% or adapt to a changing economy, and have shown flexibility as $181.8 million to $620.1 million for the year ended well as iniative in managing through the cyclicality of our December 31, 2008 as compared to $438.3 million for the Crane markets, which should position our company for year ended December 31, 2007. The sales increase during future growth opportunities when our end markets recover. 2008 was driven by $179.1 million in net sales from the busi- Looking ahead to 2010, we expect Foodservice segment nesses acquired in connection with the Enodis acquisition revenues to improve modestly and operating margins to since October 27, 2008. Excluding the sales from the busi- continue their solid improvement. We believe that a year- nesses acquired in connection with the Enodis acquisition, over-year percentage decline in Crane segment revenues sales would have only increased by $2.7 million for the year will be significantly lower than the decline in 2009. We also ended December 31, 2008 compared to the same period expect Crane segment revenues in the first half of 2010 will last year. This increase was the result of price increases and be significantly lower than those in the first half of 2009; a favorable currency exchange rate impact. By region, however, we expect Crane segment revenue gains in the strong sales in the Asia markets and slightly higher sales in second half of 2010 versus the second half of 2009. Addi- Europe more than offset weaker sales in North America. tionally, we anticipate that operating margins in our Crane For the year ended December 31, 2008, the Foodservice segment will track above the 3.5% trough margin that we segment reported operating earnings of $56.8 million com- experienced in 2003. Other financial expectations include pared to $61.3 million for the year ended December 31, capital expenditures of approximately $50 million, deprecia- 2007. The operating earnings decrease was mainly due to tion and amortization of approximately $145 million and debt the operating earnings loss of $3.7 million from the busi- reduction of at least $200 million. nesses acquired in connection with the Enodis acquisition as a result of a $9.5 million inventory step-up purchase Cranes and Related Products — Our Crane segment is accounting adjustment recorded in the opening balance beginning to see signs of recovery in crane demand espe- sheet and subsequently recognized as a charge to earnings cially in emerging markets in Asia, Latin America, Africa and for the quarter. Operating earnings in 2008 for the legacy the Middle East. In addition, in December 2009, we saw Manitowoc Foodservice businesses, as compared to 2007, signs of demand improvement in some mature markets such were lower by $0.8 million. This decrease was due to higher as Germany and Australia. As a result, for the first time in material costs and lower volume of higher margin ice prod- more than a year, we had a month-to-month increase in our ucts mainly offset by appropriate pricing initiatives and prod- backlog from $547.5 million in November to $572.7 million in uct cost takeouts. December. We have taken advantage of the recession to increase our General Corporate Expenses efforts in innovation and to implement our product and manufacturing innovations globally. We are expanding Lean Six Sigma concepts in all manufacturing locations world- 2009 2008 2007 wide, and have implemented several initiatives to further Net sales $3,782.6 $4,503.0 $3,684.0 improve our efforts in product reliability and customer satis- Corporate expenses $ 44.4 $ 51.7 $ 48.2 faction. We have also initiated a worldwide supplier develop- % of Net sales 1.2% 1.1% 1.3% ment program to help reduce costs and improve quality. Our partnership efforts with a variety of suppliers to produce and Year Ended December 31, 2009 Compared to 2008 source operator cabs and boom channel fabrications are Corporate expenses decreased $7.3 million to $44.4 million good examples of this collaboration. in 2009 compared to $51.7 million in 2008. The decrease Looking ahead, we see opportunities driven by major was primarily due to lower employee related costs, health global trends, such as the need for improving infrastructure care costs, and reduction of professional expenses. as well as energy and power generation. This includes significant growth in wind-energy projects in many parts of the Year Ended December 31, 2008 Compared to 2007 world. We enjoy a strong position in these industries in both Corporate expenses increased $3.5 million to $51.7 million the mature and emerging markets. We also continue to see in 2008 compared to $48.2 million in 2007. The increase was demand for our industry leading product support services. primarily due to higher employee related costs, health care Our Crane Care business is not only a key differentiator for costs, and other professional expenses. Manitowoc, but it is also especially important to our customers during an economic downturn when there is an Market Conditions and Outlook intensified focus on minimizing total cost-of-ownership. In 2010, we plan to continue to strengthen our two business Our backlog as of December 31, 2009 is much lower than segments: Cranes and Related Products and Foodservice it was at the beginning of 2009. Therefore, we expect addi- Equipment. We move into 2010 with a highly skilled and tal- tional revenue decline in 2010, but it is expected to be at a ented workforce, complemented by formidable competitive significantly lower percentage decline than experienced in positions in our industries. We will also continue to optimize 2009. If present trends continue, we believe we will begin to our diverse global manufacturing base and invest in rapidly realize sequential quarterly revenue growth as we proceed growing emerging markets. Although the early signs of through the year. improving global economies are bolstering our outlook, we Making these forecasts is extremely challenging due to remain cautious in our outlook for 2010 and we believe we mixed views from nearly every trade association and indus- are prepared to adjust to the trends in our end markets. We try economist that we follow. For example, the Association 28 The Manitowoc Company, Inc. — 2009 Form 10-K

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of Equipment Manufacturers believes that the U.S. construc- tomers. Because we can help our customers operate more tion machinery business will increase 5% in 2010. Con- profitably and deliver innovative food product solutions they versely, the U.S. Department of Commerce is forecasting appear to be willing to invest in our products, even during that construction put-in-place for 2010 will decline by 2%. recessionary economic conditions. From an international perspective, Global Insight, a provider According to the National Restaurant Association, it appears of global economic and financial analysis, forecasting and that 2010 will be a year of transition and improvement as market intelligence, believes the world’s total construction U.S. restaurant industry sales are forecast to decline 0.1% will grow by less than 0.5% in 2010. (adjusted for inflation) to $580 billion in 2010. Despite two con- In light of these differing forecasts, we are maintaining as secutive years of unprecedented contraction during 2008 and much operational flexibility as possible. This includes tight 2009, restaurant operators are increasing their investments in controls on inventory, ES&A expenses and manufacturing new menu items, new locations, remodeling programs, and costs, and a clear focus on the bottom line and cash. We sustainability initiatives. Such investments, while still cautious, believe that we will continue to generate positive cash flows create opportunities for additional and innovative kitchen from working capital in 2010. For 2010, our top five priorities equipment that enhance operator profitability. in our Crane segment are the following: continuing to build The 2010 U.S. National Restaurant Association recently on our strong market share position in emerging markets reported that approximately 40% of all quick-service opera- across most product lines; developing our distribution net- tors plan to make capital expenditures in the first half of work in India and China; maintaining our global efforts on 2010. A leading QSR chain recently announced plans to innovation and product development; maintaining a balance increase capital expenditures by 14% in 2010, building more between lean inventory and being able to respond to the than 1,000 new stores and remodeling approximately 2,300 short lead-time expectations of our customers; and finally, more. Planet Retail, which tracks the global foodservice and leveraging our large installed base to maximize aftermarket food retail industries, forecasts continued global growth in revenue opportunities. facilities and sales in both industries for 2010 and beyond. From a longer-term perspective, we believe we are among Our strong position in these categories gives us signifi- the world’s leading sources of lifting solutions, with what we cant opportunities to grow along with our customers. Not believe to be the most recognized brands and the broadest only do we aim to be their supplier of choice, but also their manufacturing and support footprint in the industry. Globally, innovator of choice. Our customers are constantly looking we expect a sustained demand for modern infrastructure and for ways to innovate their menus, and we are at the fore- energy, and we are well-positioned to support these end mar- front of that innovation. As validation of those relationships, kets anywhere in the world. We have a resilient business, Frymaster, Garland, and Lincoln received Kitchen Innovation with loyal customers and a large installed base comple- Awards from the National Restaurant Association in 2009, mented by the best and most experienced workforce in the while Cleveland, Delfield, Frymaster, Lincoln and Manitowoc industry. As a result, we expect to not only weather the cur- were recognized as Best In Class by Foodservice Equipment rent downturn, but at the same time to prepare for the next and Supplies magazine in their respective categories. up-cycle when growth returns to the world’s economies. Finally, our Foodservice equipment brands are well- positioned leaders that span virtually all major commercial Foodservice Equipment — Our Foodservice segment foodservice equipment categories. Our team is remarkably entered 2010 in a strong position. With the acquisition of passionate about the combined businesses and the opportu- Enodis, we are a leading player in the global foodservice nities that our market position and global capabilities provide equipment industry. Our customers include many of the us. For 2010, our priority is to continue the work of integrat- fastest-growing and most-innovative foodservice companies ing our Foodservice equipment organization, realizing syner- in the world. They come to us for innovations that allow gies from the combination, and to continue to build an them to improve their menus, enhance their operations and industry-leading business for the long-term. reduce their costs. We serve customers in more than 100 countries and we will continue to expand and support Liquidity and Capital Resources our customers wherever they grow. Our integrated manufac- Cash flow from operations during 2009 was $338.6 million turing operations, service sites and sales offices work compared to $309.0 million in 2008. We applied a portion of together to assist customers worldwide, whether these cus- this cash flow in 2009 to capital spending and dividends tomers are local businesses or global companies. with the majority of this cash flow used to repay debt. We The integration of the businesses acquired in connection had $105.8 million in cash and cash equivalents on-hand at with the Enodis acquisition is well underway, yet we believe December 31, 2009 versus $173.0 million on-hand at we are continuing to identify and accelerate additional syner- December 31, 2008. gies, both in terms of revenue opportunities and expense Cash flow from operating activities during 2009 was nega- savings. Even as we are focused on maximizing these costs tively affected by weaker operating earnings from continuing savings, we are also continuing to invest in people, products operations of $188.8 million, after adjusting for goodwill and and processes. A good example is the completion of an intangible asset impairments of $700.0 million, as compared innovative and easy-to-operate blended beverage machine to $519.8 million of operating earnings from continuing for one of the world’s leading QSR chains. We anticipate operations in 2008. However, as a result of significant reduc- that we will deliver and install thousands of these units in tions in working capital during 2009, the company was able 2010. We have also launched numerous energy saving and to surpass 2008 cash flow from operations by $29.6 million. sustainability initiatives in Foodservice to help our cus- The primary contributors to the reductions in working capital

The Manitowoc Company, Inc. — 2009 Form 10-K 29

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were a decrease in inventory levels of $349.4 million and a cash flow impact of these fees, which totaled $90.8 million, decrease in accounts receivable levels of $301.6 million. Par- is included in cash flow used for financing activities in the tially offsetting these favorable reductions were reductions Consolidated Statement of Cash Flows for the year ending in accounts payable levels of $307.9 million, employee December 31, 2008. The non-cash portion of these fees was related accruals of $76.8 million, miscellaneous accruals of the result of original issue discount on the Term Loan B por- $50.0 million and a $70.0 million settlement payment made tion of the New Credit Facility. in the first half of 2009 related to a settlement of a long- In June 2009, the company entered into Amendment standing, non-operational legal matter assumed in connec- No. 2 (the June 2009 Amendment) to the New Credit Agree- tion with the Enodis acquisition. See further detail related to ment to provide relief under its consolidated total leverage the legal settlement at Note 17, “Contingencies and Signifi- ratio and consolidated interest coverage ratio financial cant Estimates.” The decreases in inventory and receivable covenants. This June 2009 Amendment was obtained to levels are related to the lower sales of our Crane products avoid a potential financial covenant violation at the end of while the decrease in accounts payable is attributable to the the second quarter of 2009 as a result of lower demand for lower levels of inventory. certain of the company’s products due to continued weak- Cash flows from investing activities in 2009 consisted pri- ness in the global economy and tight credit markets. Terms marily of cash provided from the sale of the Enodis ice busi- of the June 2009 Amendment included an increase in the nesses of $149.2 million partially offset by cash used for margin on London Interbank Offered Rate (LIBOR) and Alter- capital expenditures of $72.5 million. Net cash used for native Borrowing Rate (ABR) loans of between 150 and 175 investing activities in 2008 was $2.4 billion and was primarily basis points, depending on the consolidated total leverage the result of our acquisition of Enodis for $2,060.8 million ratio. Also, one additional interest rate pricing level was and the related $379.4 million settlement of hedges imple- added for each loan facility above a certain leverage amount. mented to reduce the currency risk of the Great British The New Credit Agreement, as amended through Pound purchase price. In addition, the company received December 31, 2009, contained financial covenants whereby $118.5 million from the sale of its Marine segment and used the ratio of (a) consolidated earnings before interest, taxes, cash for capital expenditures of $150.3 million in 2008. depreciation and amortization, and other adjustments Cash flows used for financing activities consisted prima- (EBITDA), as defined in the New Credit Agreement to rily of the paydown of debt in 2009 of $474.5 million. In (b) consolidated interest expense, each for the most recent 2008, cash flows provided from financing activities con- four fiscal quarters (Consolidated Interest Coverage Ratio) sisted primarily of proceeds from the issuance of long-term and the ratio of (c) consolidated indebtedness to (d) consoli- debt to effect the Enodis acquisition. Financing activities dated EBITDA for the most recent four fiscal quarters (Con- resulted in a net source of cash of $1.9 billion during 2008 solidated Total Leverage Ratio), at all times were updated to compared to a use of cash of $507.4 million in 2009. new limits as agreed with the company’s lenders. On October 27, 2008, we completed our acquisition of In addition, the June 2009 Amendment added a financial Enodis, a global leader in the design and manufacture of inno- covenant whereby a ratio of (e) consolidated senior secured vative equipment for the commercial foodservice industry. indebtedness to (f) consolidated EBITDA for the most recent The $2.7 billion acquisition, inclusive of the purchase of out- four fiscal quarters (Consolidated Senior Secured Indebted- standing shares and rights to shares, acquired debt, the set- ness Ratio), beginning with the fiscal quarter ending tlement of hedges related to the acquisition and transaction June 30, 2011, was established with certain defined limits fees, was the largest and most recent acquisition for the com- as agreed with the company’s lenders. pany and has established Manitowoc among the world’s top The June 2009 Amendment also reduced or eliminated manufacturers of commercial foodservice equipment. With certain options to increase the borrowing capacity of the this acquisition, our Foodservice equipment capabilities now revolving facility or Term Loan A. Additionally, the June 2009 span refrigeration, ice-making, cooking, food-prep, and bever- Amendment placed certain limitations on capital expendi- age-dispensing technologies, and allow us to be able to equip tures, restricted payments and acquisitions per calendar entire commercial kitchens and serve the world’s growing year depending on the Consolidated Total Leverage Ratio. demand for food prepared away from home. See further The New Credit Agreement, as amended, also continued to detail related to the acquisition at Note 3, “Acquisitions.” contain customary representations and warranties and In April 2008, in order to fund the Enodis acquisition, the events of default. company entered into the New Credit Agreement. The The company accounted for the Amendment under the New Credit Agreement became effective November 6, 2008 provisions of ASC Topic 470-50, “Modifications and Extin- and includes four loan facilities — a revolving facility of guishments.” As the present value of the cash flows both $400.0 million with a five-year term, a Term Loan A of prior to and after the Amendment was not substantially $1,025.0 million with a five-year term, a Term Loan B of different, fees of $17.0 million paid by the company to the $1,200.0 million with a six-year term, and a Term Loan X of parties to the New Credit Agreement were capitalized in $300.0 million with an eighteen-month term. The company is connection with the Amendment and along with the existing obligated to prepay the three term loan facilities from the net unamortized debt fees, will be amortized over the remaining proceeds of asset sales, casualty losses, equity offerings, term of the New Credit Agreement using the effective inter- and new indebtedness for borrowed money, and from a por- est method. Furthermore, in accordance with ASC Topic tion of its excess cash flow, subject to certain exceptions. 470-50, costs incurred with third parties of $0.3 million were In connection with its New Credit Agreement in 2008, the expensed as incurred. company incurred $118.3 million in debt issuance costs. The

30 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 30 CHKSUM Content: 24379 Layout: 35603 Graphics: No Graphics CLEAN

On December 3l, 2009, the company also had outstanding and $600.0 million of Term Loan B was fixed at 3.64% rate 1 $150.0 million of 7 ⁄8% Senior Notes due 2013 (Senior Notes plus a 450 basis point spread, which equals 8.14%. Both due 2013). The Senior Notes due 2013 are unsecured senior interest rate hedges for the Term Loan A and Term Loan B obligations. Our New Credit Facility ranks equally with the are amortizing swaps that have an aggregate weighted aver- Senior Notes due 2013, except that the New Credit Facility is age life of three years. The remaining unhedged portions of secured by substantially all domestic tangible and intangible the Term Loans A and B continue to bear interest at a vari- assets of the company and its subsidiaries. The Senior able interest rate plus the applicable spread according to the Notes due 2013 are fully and unconditionally jointly and sev- New Credit Agreement, as amended. As of December 31, erally guaranteed by substantially all of the company’s 2009 total notional amounts equal to $336.4 million and domestic subsidiaries (see Note 23, “Subsidiary Guarantors $648.0 million of fixed rate hedges were outstanding on of Senior Notes due 2013”). Interest on the Senior Notes Term Loans A and B, respectively. due 2013 is payable semiannually in May and Prior to November 6, 2008, the company borrowed from November each year. The Senior Notes due 2013 can be its $300.0 million Amended and Restated Credit Agreement, redeemed by the company in whole or in part for a premium dated as of December 14, 2006. on or after November 1, 2008. The following would be the On January 21, 2010, the company entered into an amend- premium paid by the company, expressed as a percentage ment (January 2010 Amendment) to the New Credit Agree- of the principal amount, if it redeems the Senior Notes due ment. The January 2010 Amendment, among other things, 2013 during the 12-month period commencing on November 1 amends the definition of Consolidated Earnings Before Inter- of the year set forth below: est and Taxes (EBIT) to provide add-backs for certain additional cash restructuring charges, and amends certain Year Percentage financial ratios that the company is required to maintain. 2010 101.188% The January 2010 Amendment contains financial covenants whereby the ratio of (a) consolidated earnings 2011 and thereafter 100.000% before interest, taxes, depreciation and amortization, and other adjustments (EBITDA), as defined in the New Credit The company’s Senior Notes due 2013 (Senior Notes due Agreement to (b) consolidated interest expense, each for 2013) also contain customary affirmative and negative the most recent four fiscal quarters (Consolidated Interest covenants. These covenants also limit, among other things, Coverage Ratio) and the ratio of (c) consolidated indebted- our ability to redeem or repurchase our debt, incur additional ness to (d) consolidated EBITDA for the most recent four fis- debt, make acquisitions, merge with other entities, pay divi- cal quarters (Consolidated Total Leverage Ratio), at all times dends or distributions, repurchase capital stock, and create must each meet the amended limits listed below: or become subject to liens. As of December 31, 2009, the company had outstanding Consolidated $58.9 million of indebtedness that has a weighted-average Consolidated Interest interest rate of approximately 6.1%. This debt includes out- Total Leverage Coverage standing overdraft balances and capital lease obligations in Fiscal Quarter Ending: Ratio Ratio our Asia-Pacific and European regions. As of December 31, 2009, the company was in compliance (less than) (greater than) with all affirmative and negative covenants in its debt instru- March 31, 2010 7.80:1 1.75:1 ments inclusive of the financial covenants pertaining to the June 30, 2010 7.80:1 1.75:1 New Credit Agreement, as amended, and the Senior Notes September 30, 2010 7.25:1 1.80:1 due 2013. Based upon our current plans and outlook, we December 31, 2010 6.625:1 1.85:1 believe we will be able to comply with these covenants dur- March 31, 2011 6.50:1 2.00:1 ing the subsequent 12 months. As of December 31, 2009 our June 30, 2011 6.375:1 2.00:1 Consolidated Total Leverage Ratio was 5.85:1, below the September 30, 2011 6.250:1 2.125:1 maximum ratio of 7:125:1 and our Consolidated Interest Cov- December 31, 2011 5.75:1 2.25:1 erage Ratio was 2:29:1, above the minimum ratio of 1.875:1. As a result of the June 2009 Amendment of the New March 31, 2012 5.75:1 2.375:1 Credit Agreement, the company terminated the Term Loan A June 30, 2012 5.25:1 2.50:1 interest rate swap entered into in January 2009 resulting in a September 30, 2012 4.75:1 2.50:1 realized gain of $2.0 million and entered into a new interest December 31, 2012 4.50:1 2.75:1 rate swap related to Term Loan A. In accordance with ASC March 31, 2013 4.50:1 2.75:1 Topic 815-10, the realized gain will be amortized as an June 30, 2013 4.25:1 3.00:1 adjustment to interest expense over the life of the original September 30, 2013 3.75:1 3.00:1 January Term Loan A swap. The Amended Term Loan A December 31, 2013 and thereafter 3.50:1 3.00:1 swap transaction is fixed to the 3 month LIBOR interest rate for 50 percent of the notional amount of debt. The Term In addition, the January 2010 Amendment amended the Loan B swap transaction is fixed to the 1 month LIBOR with financial covenant whereby the ratio of (e) consolidated sen- a 3 percent floor for 50 percent of the notional amount of ior secured indebtedness to (f) consolidated EBITDA for the debt. In June 2009 $449.4 million of Term Loan A was fixed most recent four fiscal quarters (Consolidated Senior at 2.50% plus a 450 basis point spread, which equals 7.00%

The Manitowoc Company, Inc. — 2009 Form 10-K 31

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 31 CHKSUM Content: 55989 Layout: 41126 Graphics: No Graphics CLEAN

Secured Indebtedness Ratio), beginning with the fiscal quar- Restated Receivables Purchase Agreement (Receivables Pur- ter ending December 31, 2010, must meet certain defined chase Agreement) to align the included financial covenant limits listed below: ratios with those of the New Credit Agreement, as amended. As of December 31, 2009, the company was in Consolidated compliance with all affirmative and negative covenants inclu- Senior Secured sive of the financial covenants pertaining to the Receivables Leverage Purchase Agreement. Fiscal quarter ending: Ratio The securitization program includes certain of the com- (less than) pany’s domestic U.S. Foodservice and Crane segment businesses. On September 28, 2009, the company entered into December 31, 2010 5.00:1 Amendment No. 5 to the Amended and Restated Receiv- March 31, 2011 5.00:1 ables Purchase Agreement whereby the company modified June 30, 2011 5.00:1 its securitization program to, among other things, increase September 30, 2011 5.00:1 the capacity of the program from $105.0 million to December 31, 2011 4.25:1 $125.0 million and to add two additional businesses under March 31, 2012 4.25:1 the program. Trade accounts receivables sold to the Pur- June 30, 2012 4.00:1 chaser and being serviced by the company totaled September 30, 2012 3.75:1 $68.5 million at December 31, 2009 versus $105.0 million December 31, 2012 3.50:1 sold to the Purchaser at December 31, 2008. March 31, 2013 3.25:1 On December 17, 2009 and December 31, 2009, respec- June 30, 2013 3.25:1 tively, the company entered into Amendments No. 6 and 7 to the Receivables Purchase Agreement whereby the company September 30, 2013 3.25:1 modified the program to, among other things, add two addi- December 31, 2013 and thereafter 3.00:1 tional businesses and amend certain defined terms to update the program for changes to the company’s legal structure. On December 31, 2008, the company completed the sale On March 6, 2008, the company formed a 50% joint venture of its Marine segment to Fincantieri Marine Group Holdings, with the shareholders of Tai’An Dongyue for the production of Inc., a subsidiary of Fincantieri — Cantieri Navali Italiani SpA. mobile and truck-mounted hydraulic cranes. The cash flow The sale price in the all-cash transaction was approximately impact of this acquisition is included in business acquisitions, $120 million. The company used the cash proceeds, net of a net of cash acquired, within the cash flow from investing sec- preliminary working capital adjustment, to partially pay tion of the Consolidated Statement of Cash Flows. See further down the balance on the Term Loan X of approximately detail related to the joint venture at Note 3, “Acquisitions.” $118.5 million. On May 15, 2009 the company completed We spent a total of $72.5 million during 2009 for capital the sale of the Enodis global ice machine operations to expenditures. We continued to fund capital expenditures to Braveheart Acquisition, Inc., an affiliate of Warburg Pincus improve the cost structure of our business, invest in new Private Equity X, L.P., for $160 million. The company used processes, products and technology, to maintain high- the after-tax net proceeds of approximately $150 million to quality production standards and to complete certain pro- reduce the balance on Term Loan X. On December 16, 2009, duction capacity expansion. The following table summarizes the company paid off the remaining balance on Term Loan X. 2009 capital expenditures and depreciation by segment. The company has entered into an accounts receivable securitization program whereby it sells certain of its domes- Capital tic trade accounts receivable to a wholly owned, bankruptcy- Expenditures Depreciation remote special purpose subsidiary which, in turn, sells participating interests in its pool of receivables to a third- Cranes and Related Products $51.5 $55.3 party financial institution (Purchaser). The Purchaser receives Foodservice Equipment 18.4 33.5 an ownership and security interest in the pool of receiv- Corporate 2.6 2.8 ables. New receivables are purchased by the special pur- Total $72.5 $91.6 pose subsidiary and participation interests are resold to the Purchaser as cash collections reduce previously sold partici- On July 19, 2007, the company acquired Shirke Construc- pation interests. The company has retained collection and tion Equipments Pvt. Ltd (Shirke). Headquartered in Pune, administrative responsibilities on the participation interests India, Shirke is a market leader in the Indian tower crane sold. The Purchaser has no recourse against the company industry and has been Potain’s Indian manufacturing partner for uncollectible receivables; however, the company’s and distributor since 1982. The cash flow impact of this retained interest in the receivable pool is subordinate to the acquisition is included in business acquisition, net of cash Purchaser and is recorded at fair value. The securitization acquired within the cash flow from investing section of the program also contains customary affirmative and negative Consolidated Statements of Cash Flows. covenants. Among other restrictions, these covenants On January 3, 2007, the company acquired the Carrydeck require the company to meet specified financial tests, which line of mobile industrial cranes from Marine Travelift, Inc. of include a consolidated interest coverage ratio and consoli- Sturgeon Bay, Wisconsin. The acquisition of the Carrydeck dated total leverage ratio. On June 29, 2009, the company line added six new models to the company’s product offer- entered into Amendment No. 4 to the Amended and ing of mobile industrial cranes. The cash flow impact of this

32 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 32 CHKSUM Content: 41208 Layout: 50519 Graphics: No Graphics CLEAN

acquisition is included in business acquisitions, net of cash generated from future operations, and access to public debt acquired within the cash flow from investing section of the and equity markets will be adequate to fund our capital and Consolidated Statements of Cash Flows. debt financing requirements for the foreseeable future. On April 3, 2007, we sold all of our aftermarket replace- On February 3, 2010, in accordance with its previously ment parts and rights to manufacture, sell and service after- announced intentions, the company entered into an Under- market replacement parts, for all the models of the Grove writing Agreement with J.P. Morgan Securities Inc. as repre- Manlift aerial work platform product line around the world, sentative of the several underwriters, pursuant to which the to MinnPar LLC (MinnPar) for $4.9 million. The cash flow company agreed to sell, and the underwriters agreed to pur- impact of this divestiture is recorded in gain on sale of parts chase $400,000,000 of the company’s 9.50% Senior Notes line and in proceeds from sale of business or parts in the due 2018 to be guaranteed by guarantors in a public offering Consolidated Statements of Cash Flows. which closed on February 8, 2010. Refer to Note 26, “Subse- Restricted cash represents cash in escrow funds related quent Events,” for additional information. to the security for an indemnity agreement for our casualty Our liquidity positions as of December 31, 2009 and 2008 insurance provider. are as follows: 1 On August 1, 2007, the company redeemed its 10 ⁄2% senior subordinated notes due 2012. Pursuant to the terms of the 2009 2008 indenture, the company paid the note holders 105.25 percent Cash and cash equivalents $108.4 $175.6 of the principal amount plus accrued and unpaid interest up to Revolver borrowing capacity 400.0 383.0 the redemption date. As a result of this redemption, the com- Less: outstanding letters of credit (43.6) (68.3) pany incurred a charge of $12.5 million related to the call premium, the write-off of unamortized debt issuance costs Total liquidity $464.8 $490.3 and other expenses. We utilized cash on hand and availability under our revolving credit facility to fund this redemption. Management also considers the following regarding liquid- During the years ended December 31, 2009, 2008 and ity and capital resources to identify trends, demands, com- 2007, we sold $6.1 million, $3.7 million and $14.2 million, mitments, events and uncertainties that require disclosure: respectively, of our long term notes receivable to third party A. Our New Credit Agreement requires us to comply with financing companies. We guarantee varying percentages, up certain financial ratios and tests to comply with the to 100%, of collection of the notes to the financing compa- terms of the agreement. We were in compliance with nies. We have accounted for the sales of the notes as a these covenants as of December 31, 2009, the latest financing of receivables. The receivables remain on our Con- measurement date. The occurrence of any default of solidated Balance Sheets, net of payments made, in other these covenants could result in acceleration of any current and non-current assets, and we have recognized an outstanding balances under the New Credit Agreement. obligation equal to the net outstanding balance of the notes Further, such acceleration would constitute an event of in other current and non-current liabilities in the Consolidated default under the indentures governing our Senior Notes Balance Sheets. The cash flow benefit of these transactions due 2013 and Senior Notes due 2018 and could trigger is reflected as a financing activity in the Consolidated State- cross default provisions in other agreements. ments of Cash Flows. During the years ended December 31, B. Circumstances that could impair our ability to continue 2009, 2008 and 2007, the customers paid $11.5 million, to engage in transactions that have been integral to his- $7.5 million and $18.5 million, respectively, of the notes to torical operations or are financially or operationally the third party financing companies. As of December 31, essential, or that could render that activity commercially 2009, 2008 and 2007, the outstanding balance of the notes impracticable, such as the inability to maintain a speci- receivable guaranteed by us was $9.0 million, $14.5 million fied credit rating, level of earnings, earnings per share, and $18.2 million, respectively. financial ratios, or collateral. We do not believe that the Our debt position at various times increases our vulnera- risk factors applicable to our business are reasonably bility to general adverse industry and economic conditions likely to impair our ability to continue to engage in our and results in a meaningful portion of our cash flow from planned activities at this time. operations being used for payment of interest on our debt. C. Factors specific to us and our markets that we expect to This could potentially limit our ability to respond to market be given significant weight in the determination of our conditions or take advantage of future business opportuni- credit rating or will otherwise affect our ability to raise ties. Our ability to service our debt is dependent upon many short-term and long-term financing . We do not factors, some of which are not subject to our control, such presently believe that events covered by the risk factors as general economic, financial, competitive, legislative, and applicable to our business could materially affect our regulatory factors. In addition, our ability to borrow addi- credit ratings or could adversely affect our ability to raise tional funds under the revolving credit facility in the future short-term or long-term financing. will depend on our meeting the financial covenants con- D. We have disclosed information related to certain guaran- tained in the credit agreement, even after taking into tees in Note 17 to our Consolidated Financial Statements. account such new borrowings. E. Written options on non-financial assets (for example, The revolving credit facility under our New Credit Agree- real estate puts). We do not have any written options on ment or other future facilities may be used for working capi- non-financial assets. tal requirements, capital expenditures, funding future acquisitions, and other investing and financing needs. We believe that our available cash, revolving credit facility, cash The Manitowoc Company, Inc. — 2009 Form 10-K 33

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 33 CHKSUM Content: 52492 Layout: 65333 Graphics: No Graphics CLEAN

OFF-BALANCE SHEET ARRANGEMENTS • We have disclosed our accounts receivable securitiza- Our disclosures concerning transactions, arrangements and tion arrangement in Note 12 to the Consolidated Finan- other relationships with unconsolidated entities or other per- cial Statements. sons that are reasonably likely to materially affect liquidity or the availability of or requirements for capital resources are CONTRACTUAL OBLIGATIONS AND COMMERCIAL as follows: COMMITMENTS • We have disclosed in Note 18 to the Consolidated A summary of our significant contractual obligations as of Financial Statements our buyback and residual value December 31, 2009 is as follows: guaranty commitments. • We lease various assets under operating leases. The future estimated payments under these arrangements are disclosed in Note 21 to the Consolidated Financial Statements and in the table below.

Total Committed 2010 2011 2012 2013 2014 Thereafter Debt $2,149.3 $139.9 $165.4 $164.3 $673.1 $1,006.6 $ — Capital leases 23.1 5.0 4.1 3.4 4.5 3.0 3.1 Operating leases 196.1 43.6 35.8 28.2 25.0 17.6 45.9 Total committed $2,368.5 $188.5 $205.3 $195.9 $702.6 $1,027.2 $49.0

• There were no significant purchase obligation commitments at December 31, 2009. • The table above does not include interest payments. • Unrecognized tax liabilities totaling $42.3 million as of December 31, 2009, excluding related interests and penalties, are not included in the table because the timing of their resolution cannot be estimated. See Note 13 to the Consolidated Financial Statements for disclosures surrounding uncertain income tax positions under ASC Topic 740.

At December 31, 2009, we had outstanding letters of For a more detailed discussion of our accounting policies credit that totaled $43.6 million. We also had buyback com- and the financial instruments that we use, please refer to mitments and residual value guarantees outstanding, that if Note 2, “Summary of Significant Accounting Policies,” and all were satisfied in full at December 31, 2009, the total cash Note 11, “Debt,” to the Consolidated Financial Statements. cost to us would be $80.6 million. This amount is not reduced for amounts the company would recover from Interest Rate Risk repossessing and subsequent resale of collateral. As a result of the June 2009 Amendment of the New Credit We maintain defined benefit pension plans for some of Agreement, the company terminated the Term Loan A inter- our operations in the United States, Europe and Asia. The est rate swap entered into in January 2009 resulting in a company has established the Retirement Plan Committee realized gain of $2.0 million and entered into a new interest (the Committee) to manage the operations and administra- rate swap related to Term Loan A. In accordance with ASC tion of all benefit plans and related trusts. In conjunction Topic 815-10, the realized gain will be amortized as an with the Enodis acquisition (see Note 3), and effective as of adjustment to interest expense over the life of the original December 31, 2008, the company merged all but one of the January Term Loan A swap. The Amended Term Loan A swap former Enodis U.S. pension plans into the Manitowoc transaction is fixed to the 3 month LIBOR interest rate for U.S. pension plan. The unmerged plan continues to accrue 50 percent of the notional amount. The Term Loan B swap benefits for the enrolled participants, while the remaining transaction is fixed to the 1 month LIBOR with a 3 percent merged plans had benefit accruals frozen prior to the floor for 50 percent of the notional amount. In June 2009 merger of the plans. $449.4 million of Term Loan A was fixed at 2.50% plus a In 2009, cash contributions by us to all pension plans 450 basis point spread, which equals 7.00% and $600.0 mil- were $4.1 million, and we estimate that our pension plan lion of Term Loan B was fixed at 3.64% rate plus a 450 basis contributions will be approximately $6.3 million in 2010. point spread, which equals 8.14%. Both interest rate hedges for the Term Loan A and Term Loan B are amortizing swaps Financial Risk Management that have an aggregate weighted average life of three years. We are exposed to market risks from changes in interest rates, The remaining unhedged portions of the Term Loans A and commodities, and changes in foreign currency exchange rates. B continue to bear interest at a variable interest rate plus the To reduce these risks, we selectively use derivative financial applicable spread according to the New Credit Agreement, instruments and other proactive management techniques. We as amended. As of December 31, 2009 total notional have written policies and procedures that place financial instru- amounts equal to $336.4 million and $648.0 million of fixed ments under the direction of corporate finance and restrict all rate hedges were outstanding on Term Loans A and B, derivative transactions to those intended for hedging pur- respectively. poses. The use of financial instruments for trading purposes or speculation is strictly prohibited.

34 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 34 CHKSUM Content: 12433 Layout: 58140 Graphics: No Graphics CLEAN

Commodity Prices Amounts invested in non-U.S. based subsidiaries are trans- We are exposed to fluctuating market prices for commodities, lated into U.S. dollars at the exchange rate in effect at year- including steel, copper, aluminum, and petroleum-based prod- end. Results of operations are translated into U.S. dollars at ucts. Each of our business segments is subject to the effect an average exchange rate for the period. The resulting trans- of changing raw material costs caused by movements in lation adjustments are recorded in stockholders’ equity as underlying commodity prices. We have established programs cumulative translation adjustments. The translation adjust- to manage the negotiations of commodity prices. Some of ment recorded in accumulated other comprehensive income these programs are centralized across business segments, at December 31, 2009 is $86.6 million. and others are specific to a business segment or business unit. In addition to the regular negotiations of material prices Environmental, Health, Safety, and Other Matters with certain vendors, during 2009 we entered into certain Please refer to Item 8, Financial Statements and Supplemen- commodity hedges that fix the price of certain of our key tary Data, Note 17 to the Consolidated Financial Statements commodities utilized in the production of our Foodservice where we have disclosed our Environmental, Health, Safety, product offerings. At December 31, 2009, $0.9 million (net of Contingencies and other Matters. tax of $0.5 million) of unrealized losses due to commodity hedging positions remain deferred in accumulated other com- Critical Accounting Policies prehensive income and will be realized as a component of The Consolidated Financial Statements include the accounts cost of sales over the next 12 months. of the company and all its subsidiaries. The preparation of financial statements in conformity with accounting princi- Currency Risk ples generally accepted in the United States of America We have manufacturing, sales and distribution facilities requires us to make estimates and assumptions in certain around the world and thus make investments and enter into circumstances that affect amounts reported in the accompa- transactions denominated in various foreign currencies. Inter- nying Consolidated Financial Statements and related foot- national sales, including those sales that originated outside notes. In preparing these Consolidated Financial Statements, of the United States, were approximately 51% of our total we have made our best estimates and judgments of certain sales for 2009, with the largest percentage (43%) being sales amounts included in the Consolidated Financial Statements into various European countries. giving due consideration to materiality. We do not believe Regarding transactional foreign exchange risk, we enter there is a great likelihood that materially different amounts into limited forward exchange contracts to 1) reduce the would be reported related to the accounting policies impact of changes in foreign currency rates between a bud- described below. However, application of these accounting geted rate and the rate realized at the time we recognize a policies involves the exercise of judgment and use of particular purchase or sale transaction and 2) reduce the assumptions as to future uncertainties and, as a result, earnings and cash flow impact on nonfunctional currency actual results could differ from these estimates. Although denominated receivables and payables. Gains and losses we have listed a number of accounting policies below which resulting from hedging instruments either impact our Consol- we believe to be most critical, we also believe that all of our idated Statements of Operations in the period of the underly- accounting policies are important to the reader. Therefore, ing purchase or sale transaction, or offset the foreign please refer also to the Notes to the Consolidated Financial exchange gains and losses on the underlying receivables and Statements for more detailed description of these and other payables being hedged. The maturities of these forward accounting policies of the company. exchange contracts coincide with either the underlying transaction date or the settlement date of the related cash inflow Revenue Recognition — Revenue is generally recognized and or outflow. The hedges of anticipated transactions are desig- earned when all the following criteria are satisfied with regard nated as cash flow hedges and the hedges of accounts to a specific transaction: persuasive evidence of an arrange- receivable and accounts payable are designated as fair value ment exists, the price is fixed and determinable, collectability hedges under the guidance of ASC Topic 815-10, “Derivatives of cash is reasonably assured, and delivery has occurred or and Hedging”. At December 31, 2009, we had outstanding services have been rendered. We periodically enter into trans- forward exchange contracts hedging anticipated transactions actions with customers that provide for residual value guaran- and future settlements of outstanding accounts receivable tees and buyback commitments. These transactions are and accounts payable with an aggregate fair market value of recorded as operating leases for all significant residual value a liability of $4.0 million. A 10% appreciation or depreciation guarantees and for all buyback commitments. These initial of the underlying functional currency at December 31, 2009 transactions are recorded as deferred revenue and are amor- for fair value hedges would not have a significant impact on tized to income on a straight-line basis over a period equal to our Consolidated Statements of Operations as any gains or that of the customer’s third-party financing agreement. In losses under the foreign exchange contracts hedging addition, we lease cranes to customers under operating lease accounts receivable or payable balances would be offset by terms. Revenue from operating leases is recognized ratably equal gains or losses on the underlying receivables or over the term of the lease, and leased cranes are depreciated payables. A 10% appreciation or depreciation of the underly- over their estimated useful lives. ing functional currency at December 31, 2009 for cash flow hedges would not have a significant impact on the date of Revenue Recognition under Percentage-of-completion settlement due to the insignificant amounts of such hedges. Accounting — Revenue under long-term contracts, primarily

The Manitowoc Company, Inc. — 2009 Form 10-K 35

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 35 CHKSUM Content: 63816 Layout: 41597 Graphics: No Graphics CLEAN

within the former Marine segment, are recognized using the “Intangibles — Goodwill and Other.” Under ASC Topic 350-10, percentage-of-completion (POC) method of accounting. goodwill is no longer amortized; however, the company per- Under this method, sales and gross profit are recognized as forms an annual impairment review at June 30 of every year work is performed based on the relationship between actual or more frequently if events or changes in circumstances indi- costs incurred and total estimated costs at the completion cate that the asset might be impaired. The company performs of the contract. Recognized revenues that will not be billed impairment reviews for its reporting units, which have been under the terms of the contract until a later date are determined to be: Cranes Americas; Cranes Europe, Middle recorded as “recoverable costs and accrued profit on East, and Africa; Cranes Asia; Crane Care; Foodservice progress completed not billed,” which are included in other Americas; Foodservice Europe, Middle East, and Africa; current assets in the Consolidated Balance Sheets. Like- Foodservice Asia; and Foodservice Retail, using a fair-value wise, contracts where billings to date have exceeded recog- method based on the present value of future cash flows, nized revenues are recorded as “amounts billed in excess of which involves management’s judgments and assumptions sales,” which are included in accounts payable and accrued about the amounts of those cash flows and the discount rates expenses in the Consolidated Balance Sheets. Changes to used. The estimated fair value is then compared with the car- the original estimates may be required during the life of the rying amount of the reporting unit, including recorded good- contract and such estimates are reviewed when customer will. Goodwill and other intangible assets are then subject to change orders are placed and on a regular periodic basis. risk of write-down to the extent that the carrying amount Sales and gross profit are adjusted when known for revi- exceeds the estimated fair value. sions in estimated total contract costs and contract values. During the first quarter of 2009, the company’s stock price Claims against customers are recognized as revenue when it continued to decline as global market conditions remained is probable that the claim will result in additional contract depressed, the credit markets did not improve and the per- revenue and the amount can be reliably estimated. Esti- formance of the company’s Crane and Foodservice seg- mated losses are recorded when identified. The use of the ments was below the company’s expectations. In connection POC method of accounting involves considerable use of with a reforecast of expected 2009 financial results com- estimates in determining revenues, costs and profits and in pleted in early April 2009, the company determined the fore- assigning the amounts to accounting periods. The company going circumstances to be indicators of potential impairment continually evaluates all of the issues related to the assump- under the guidance of ASC Topic 350-10. Therefore, the com- tions, risks and uncertainties inherent with the application of pany performed the required initial (“Step One”) impairment the POC method of accounting. test for each of the company’s operating units as of March 31, 2009. The company re-performed its established Allowance for Doubtful Accounts — Accounts receivable are method of present-valuing future cash flows, taking into reduced by an allowance for amounts that may become account the company’s updated projections, to determine uncollectible in the future. Our estimate for the allowance for the fair value of the reporting units. The determination of fair doubtful accounts related to trade receivables includes evalu- value of the reporting units requires the company to make ation of specific accounts where we have information that the significant estimates and assumptions. The fair value meas- customer may have an inability to meet its financial obliga- urements (for both goodwill and indefinite-lived intangible tions together with a general provision for unknown but exist- assets) are considered Level 3 within the fair value hierarchy. ing doubtful accounts based on pre-established percentages These estimates and assumptions primarily include, but are to specific aging categories which are subject to change if not limited to, projections of revenue growth, operating earn- experience improves or deteriorates. Due to overall market ings, discount rates, terminal growth rates, and required capi- conditions and deterioration in the credit markets, we have tal for each reporting unit. Due to the inherent uncertainty experienced a change in collection patterns but we have not involved in making these estimates, actual results could dif- experienced significant defaults on customer payments. fer materially from the estimates. The company evaluated the significant assumptions used to determine the fair value of Inventories and Related Reserve for Obsolete and Excess each reporting unit, both individually and in the aggregate, Inventory — Inventories are valued at the lower of cost or and concluded they were reasonable. market using both the first-in, first-out (FIFO) method and The results of the analysis indicated that the fair values of the last-in, first-out (LIFO) method and are reduced by a three of the company’s eight reporting units (Foodservice reserve for excess and obsolete inventories. The estimated Americas; Foodservice Europe, Middle East, and Africa; and reserve is based upon specific identification of excess or Foodservice Retail) were potentially impaired: therefore, the obsolete inventories together with a general provision based company proceeded to measure the amount of the potential on pre-established percentages applied to specific aging impairment (“Step Two”) with the assistance of a third-party categories of inventory. These categories are evaluated valuation firm. Upon completion of that assessment, the based upon historical usage, estimated future usage, and company recognized impairment charges as of March 31, sales requiring the inventory. These percentages were estab- 2009, of $548.8 million related to goodwill. The company lished based upon historical write-off experience and are also recognized impairment charges of $151.2 million subject to change if experience improves or deteriorates. related to other indefinite-lived intangible assets as of March 31, 2009. Both charges were within the Foodservice Goodwill, Other Intangible Assets and Other Long-Lived segment. The goodwill and other indefinite-lived intangible Assets — The company accounts for goodwill and other assets had a carrying value of $1,598.0 million and intangible assets under the guidance of ASC Topic 350-10, $368.0 million, respectively, prior to the impairment charges.

36 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 36 CHKSUM Content: 47364 Layout: 62109 Graphics: No Graphics CLEAN

These non-cash impairment charges have no direct impact the carrying value of the businesses at December 31, 2008 on the company’s cash flows, liquidity, debt covenants, debt exceeded their fair value. We therefore considered the guid- position or tangible asset values. There is no tax benefit in ance in ASC Topic 360-10-5 and recognized a non-cash relation to the goodwill impairment; however, the company charge of $175.0 million to adjust the carrying amount of the did recognize a $52.0 million benefit associated with the businesses to be divested in the Consolidated Statements of other indefinite-lived intangible asset impairment. Operations in earnings from discontinued operations at In June 2009, the company performed its annual impair- December 31, 2008. This charge reduced the carrying ment analysis relative to goodwill and indefinite-lived intangi- amount of the businesses to be divested to our revised esti- ble assets at June 30, 2009 and based on those results the mated fair value, less costs to sell. In the first quarter of company determined no additional impairment had occurred 2009, we further reduced the carrying value by $28.8 million subsequent to the impairment charges recorded in the first through a non-cash impairment charge recorded in the Con- quarter of 2009. The company will continue to monitor mar- solidated Statement of Operations in earnings from discon- ket conditions and determine if any additional interim reviews tinued operations. The businesses were sold in May 2009. of goodwill, other intangibles or long-lived assets are war- Other intangible assets with definite lives continue to be ranted. Further deterioration in the market or actual results as amortized over their estimated useful lives. Indefinite and compared with the company’s projections may ultimately definite lived intangible assets are also subject to impair- result in a future impairment. In the event the company deter- ment testing. Indefinite lived assets are tested annually, or mines that assets are impaired in the future, the company more frequently if events or changes in circumstances indi- would need to recognize a non-cash impairment charge, cate that the assets might be impaired. Definite lived intan- which could have a material adverse effect on the company’s gible assets are tested whenever events or circumstances consolidated balance sheet and results of operations. indicate that the carrying value of the assets may not be The company also reviews long-lived assets for impairment recoverable. A considerable amount of management judg- whenever events or changes in circumstances indicate that ment and assumptions are required in performing the the assets carrying amount may not be recoverable. The impairment tests, principally in determining the fair value of company conducts its long-lived asset impairment analyses the assets. While the company believes its judgments and in accordance with ASC Topic 360-10-5, “Property, Plant, and assumptions were reasonable, different assumptions could Equipment.” ASC Topic 360-10-5 requires the company to change the estimated fair values and, therefore, impairment group assets and liabilities at the lowest level for which iden- charges could be required. tifiable cash flows are largely independent of the cash flows of other assets and liabilities and to evaluate the asset group Employee Benefit Plans — We provide a range of benefits against the sum of the undiscounted future cash flows. At to our employees and retired employees, including pensions March 31, 2009, in conjunction with the preparation of its and postretirement health care coverage. Plan assets and financial statements, the company concluded triggering obligations are recorded annually based on the company’s events occurred requiring an evaluation of the impairment of measurement date utilizing various actuarial assumptions its long-lived assets due to continued weakness in global such as discount rates, expected return on plan assets, market conditions, tight credit markets and the performance compensation increases, retirement and mortality rates, and of the Crane and Foodservice segments. This analysis did not health care cost trend rates as of that date. The approach indicate the long-lived assets were impaired. we use to determine the annual assumptions are as follows: In addition, we completed the acquisition of Enodis during • Discount Rate — Our discount rate assumptions are the fourth quarter of 2008. As a result of this acquisition, we based on the interest rate of noncallable high-quality have recorded an additional $1.3 billion of goodwill within corporate bonds, with appropriate consideration of our our Foodservice segment although a portion of goodwill pension plans’ participants’ demographics and benefit within the Foodservice segment was written off in 2009 as payment terms. discussed above. The purchase price we paid for Enodis • Expected Return on Plan Assets — Our expected return was based on our projections of future operating profits and on plan assets assumptions are based on our expecta- the expected synergies we believe we can derive from cost tion of the long-term average rate of return on assets in savings and revenue enhancements. However, we cannot be the pension funds, which is reflective of the current and assured that the intended beneficial effect from this acquisi- projected asset mix of the funds and considers the his- tion will be realized, particularly given the current difficult torical returns earned on the funds. market conditions. Consequently, a further impairment • Compensation increase — Our compensation increase charge may be required in a future period if operating results assumptions reflect our long-term actual experience, are below our projections. the near-term outlook and assumed inflation. In order to comply with the agreements with the European • Retirement and Mortality Rates — Our retirement and Commission and the United States Department of Justice we mortality rate assumptions are based primarily on actual initiated a multiple step process to divest of the required plan experience and mortality tables. businesses during the fourth quarter of 2008. As part of our • Health Care Cost Trend Rates — Our health care cost requirement to divest of these businesses, we obtained pre- trend rate assumptions are developed based on histori- liminary purchase offers from several potential buyers. As we cal cost data, near-term outlook and an assessment of continued with the sales process throughout January and likely long-term trends. February of 2009 and preliminary purchase offers were rescinded or significantly reduced, it became apparent that

The Manitowoc Company, Inc. — 2009 Form 10-K 37

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 37 CHKSUM Content: 31526 Layout: 24056 Graphics: No Graphics CLEAN

Measurements of net periodic benefit cost are based on the We measure and record income tax contingency accruals assumptions used for the previous year-end measurements under the guidance of ASC Topic 740-10. We recognize liabil- of assets and obligations. We review our actuarial assump- ities for uncertain income tax positions based on a two-step tions on an annual basis and make modifications to the process. The first step is to evaluate the tax position for assumptions when appropriate. As required by U.S. GAAP, recognition by determining if the weight of available evi- the effects of the modifications are recorded currently or dence indicates that it is more likely than not that the posi- amortized over future periods. We have developed the tion will be sustained on audit, including resolution of assumptions with the assistance of our independent actuar- related appeals or litigation processes, if any. The second ies and other relevant sources, and we believe that the step requires us to estimate and measure the tax benefit as assumptions used are reasonable; however, changes in the largest amount that is more than 50% likely to be real- these assumptions could impact the company’s financial ized upon ultimate settlement. It is inherently difficult and position, results of operations or cash flows. Refer to subjective to estimate such amounts, as we must determine Note 20, “Employee Benefit Plans,” for a summary of the the probability of various possible outcomes. We reevaluate impact of a 0.50% change in the discount rate and rate of these uncertain tax positions on a quarterly basis or when return on plan assets and a 1% change on health care trend new information becomes available to management. These rates would have on our financial statements. reevaluations are based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, Product Liability — We are subject in the normal course of successfully settled issues under audit, expirations due to business to product liability lawsuits. To the extent permit- statutes, and new audit activity. Such a change in recogni- ted under applicable laws, our exposure to losses from tion or measurement could result in the recognition of a tax these lawsuits is mitigated by insurance with self-insurance benefit or an increase to the tax accrual. retention limits. We record product liability reserves for our self-insured portion of any pending or threatened product lia- Stock Options — The computation of the expense associ- bility actions. Our reserve is based upon two estimates. ated with stock-based compensation requires the use of a First, we track the population of all outstanding pending and valuation model. We currently use a Black-Scholes option threatened product liability cases to determine an appropri- pricing model to calculate the fair value of our stock options ate case reserve for each based upon our best judgment and stock appreciation rights. The Black-Scholes model and the advice of legal counsel. These estimates are contin- requires assumptions regarding the volatility of the com- ually evaluated and adjusted based upon changes to the pany’s stock, the expected life of the stock award and the facts and circumstances surrounding the case. Second, we company’s dividend ratio. We primarily use historical data to determine the amount of additional reserve required to determine the assumptions to be used in the Black-Scholes cover incurred but not reported product liability issues and model and have no reason to believe that future data is likely to account for possible adverse development of the estab- to differ materially from historical data. However, changes in lished case reserves (collectively referred to as IBNR). This the assumptions to reflect future stock price volatility, future analysis is performed at least twice annually. We have estab- dividend payments and future stock award exercise experi- lished a position within the actuarially determined range, ence could result in a change in the assumptions used to which we believe is the best estimate of the IBNR liability. value awards in the future and may result in a material change to the fair value calculation of stock-based awards. Income Taxes — We account for income taxes under the guidance of ASC Topic 740-10, “Income Taxes.” Deferred tax Warranties — In the normal course of business, we provide assets and liabilities are recognized for the future tax conse- our customers warranties covering workmanship, and in quences attributable to differences between financial state- some cases materials, on products manufactured by us. ment carrying amounts of existing assets and liabilities and Such warranties generally provide that products will be their respective tax bases and operating loss and tax credit free from defects for periods ranging from 12 months to carryforwards. Deferred tax assets and liabilities are meas- 60 months with certain equipment having longer-term ured using enacted tax rates expected to apply to taxable warranties. If a product fails to comply with our warranty, income in the years in which those temporary differences we may be obligated, at our expense, to correct any defect are expected to be recovered or settled. We record a valua- by repairing or replacing such defective product. We provide tion allowance that represents a reserve on deferred tax for an estimate of costs that may be incurred under our war- assets for which utilization is not more likely than not. Man- ranty at the time product revenue is recognized based on agement judgment is required in determining our provision historical warranty experience for the related product or esti- for income taxes, deferred tax assets and liabilities, and the mates of projected losses due to specific warranty issues on valuation allowance recorded against our net deferred tax new products. These costs primarily include labor and mate- assets. The valuation allowance would need to be adjusted rials, as necessary, associated with repair or replacement. in the event future taxable income is materially different than The primary factors that affect our warranty liability include amounts estimated. Our policy is to remit earnings from for- the number of shipped units and historical and anticipated eign subsidiaries only to the extent any resultant foreign rates or warranty claims. As these factors are impacted by taxes are creditable in the United States. Accordingly, we do actual experience and future expectations, we assess the not currently provide for additional United States and foreign adequacy of our recorded warranty liability and adjust the income taxes which would become payable upon repatria- amounts as necessary. tion of undistributed earnings of foreign subsidiaries.

38 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 38 CHKSUM Content: 7037 Layout: 29962 Graphics: No Graphics CLEAN

Restructuring Charges — Restructuring charges for exit and In June 2009, the FASB issued guidance related to the disposal activities are recognized when the liability is accounting for transfers of financial assets codified primarily incurred. The company accounts for restructuring charges in ASC Topic 860, “Transfers and Servicing.” This guidance under the guidance of ASC Topic 420-10, “Exit or Disposal requires entities to provide more information about transfers Cost Obligations.” The liability for the restructuring charge of financial assets and a transferor’s continuing involvement, associated with an exit or disposal activity is measured ini- if any, with transferred financial assets. It also requires addi- tially at its fair value. tional disclosures about the risks that a transferor continues to be exposed to because of its continuing involvement in Recent Accounting Changes and Pronouncements transferred financial assets. ASC Topic 860 eliminates the con- In October 2009, the FASB issued Accounting Standards cept of a qualifying special-purpose entity and changes the Update 2009-13, “Multiple-Deliverable Revenue Arrange- requirements for de-recognition of financial assets. This Topic ments,” codified in ASC Topic 605. This update provides is effective for the company in its interim and annual reporting application guidance on whether multiple deliverables exist, periods beginning on and after January 1, 2010. The company how the deliverables should be separated and how the con- is currently evaluating the impact that the adoption of ASC sideration should be allocated to one or more units of Topic 860 will have on the reporting of its financial results. accounting. This guidance establishes a selling price hierar- In May 2009, the FASB issued new guidance codified pri- chy for determining the selling price of a deliverable. The marily in ASC Topic 855, “Subsequent Events.” This guidance selling price used for each deliverable will be based on ven- was issued in order to establish principles and requirements dor-specific objective evidence, if available, third-party evi- for reviewing and reporting subsequent events and requires dence if vendor-specific objective evidence is not available, disclosure of the date through which subsequent events are or estimated selling price if neither vendor-specific or third- evaluated and whether the date corresponds with the time at party evidence is available. The company will be required to which the financial statements were available for issue (as apply this guidance prospectively for revenue arrangements defined) or were issued. This guidance is effective for interim entered into or materially modified in the fiscal year begin- reporting periods ending after June 15, 2009. The adoption ning on or after June 15, 2010, with early application permit- of this guidance did not have a material impact on the con- ted. The company is currently evaluating the impact that solidated financial statements. Refer to Note 26, “Subse- adoption of this guidance will have on the determination or quent Events” for the required disclosures in accordance reporting of the company’s financial results. with ASC 855. In June 2009, the FASB issued new guidance codified in In April 2009, the FASB issued new guidance codified pri- ASC Topic 105, which establishes the FASB Accounting marily in ASC Topic 825, “Financial Instruments.” This guid- Standards Codification (“Codification”) to become the single ance requires an entity to provide disclosures about fair source of accounting principles and the framework for value of financial instruments in interim financial information selecting the principles used in the preparation of financial and is to be applied prospectively and is effective for interim statements of nongovernmental entities that are presented and annual periods ending after June 15, 2009 with early in conformity with generally accepted accounting principles adoption permitted for periods ending after March 15, 2009. in the United States. Rules and interpretive releases of the The adoption of this guidance did not have a material impact SEC under authority of federal securities laws are also on the consolidated financial statements. Refer to Note 5, sources of authoritative generally accepted accounting prin- “Fair Value of Financial Instruments” for the disclosures ciples for SEC registrants. All existing accounting standards required in accordance with this guidance. are superseded as described in ASC 105. All other account- In April 2008, the FASB issued new guidance which is codi- ing literature not included in the Codification is nonauthorita- fied primarily in ASC Topic 805, “Business Combinations.” tive. This guidance is effective for interim and annual periods This guidance requires that assets acquired and liabilities ending after September 15, 2009. The adoption of this guid- assumed in a business combination that arise from contin- ance did not have a significant impact on the determination gencies be recognized at fair value if fair value can be reason- or reporting of the company’s financial results. ably estimated. If fair value cannot be reasonably estimated, In June 2009, the FASB issued new guidance codified pri- the asset or liability would generally be recognized in accor- marily in ASC Topic 810, “Consolidation.” This guidance is dance with ASC 450. Further, the FASB removed the subse- related to the consolidation rules applicable to variable inter- quent accounting guidance for assets and liabilities arising est entities. It replaces the quantitative-based risks and from contingencies from ASC 805. This guidance also elimi- rewards calculation for determining whether an enterprise is nates the requirement to disclose an estimate of the range of the primary beneficiary in a variable interest entity with an possible outcomes of recognized contingencies at the acqui- approach that is primarily qualitative and requires ongoing sition date. For unrecognized contingencies, the FASB assessments of whether an enterprise is the primary benefi- requires that entities include only the disclosures required by ciary of a variable interest entity. This guidance also requires ASC 450. This guidance was adopted effective January 1, additional disclosures about an enterprise’s involvement in 2009. There was no impact upon adoption, and its effects on variable interest entities and is effective for the company in future periods will depend on the nature and significance of its interim and annual reporting periods beginning on and business combinations subject to this statement. after January 1, 2010. The company is currently evaluating In December 2008, the FASB issued new guidance which the impact that the adoption of this guidance will have on is codified primarily in ASC Topic 715, “Compensation — the determination or reporting of its financial results. Retirement Benefits.” This guidance is related to an

The Manitowoc Company, Inc. — 2009 Form 10-K 39

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 39 CHKSUM Content: 15373 Layout: 37392 Graphics: No Graphics CLEAN

employer’s disclosures about the type of plan assets held in cause actual results to differ materially from what appears a defined benefit pension or other postretirement plan. This within this annual report. guidance is effective for financial statements issued for fis- Forward-looking statements include descriptions of plans cal years ending after December 15, 2009. The adoption of and objectives for future operations, and the assumptions this guidance did not have a material impact on the consoli- behind those plans. The words “anticipates,” “believes,” dated financial statements. “intends,” “estimates,” and “expects,” or similar expres- In December 2007, the FASB issued additional guidance sions, usually identify forward-looking statements. Any and ASC Topic 805, “Business Combinations”, which establishes all projections of future performance are forward-looking principles and requirements for how the acquirer: (a) recog- statements. nizes and measures in its financial statements the identifiable In addition to the assumptions, uncertainties, and other assets acquired, the liabilities assumed, and any noncontrol- information referred to specifically in the forward-looking ling interest in the acquiree; (b) recognizes and measures the statements, a number of factors relating to each business goodwill acquired in the business combination or a gain from segment could cause actual results to be significantly differ- a bargain purchase; and (c) determines what information to ent from what is presented in this annual report. Those fac- disclose to enable users of the financial statements to evalu- tors include, without limitation, the following: ate the nature and financial effects of the business combination. The guidance also requires contingent consideration to Crane — cyclicality of the construction industry; the effects be recognized at its fair value on the acquisition date and, for of government spending on construction-related projects certain arrangements, changes in fair value to be recognized throughout the world; unanticipated changes in global in earnings until settled. ASC Topic 805 also requires acquisi- demand for high-capacity lifting equipment; changes in tion-related transaction and restructuring costs to be demand for lifting equipment in emerging economies; the expensed rather than treated as part of the cost of the acqui- replacement cycle of technologically obsolete cranes; and sition. This guidance applies prospectively to business com- demand for used equipment. binations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or Foodservice — weather; consolidation within the restaurant after December 15, 2008. The adoption of this guidance on and foodservice equipment industries; global expansion of January 1, 2009 did not have a significant impact on the con- customers; commercial ice-cube machine and other foodser- solidated financial statements. vice equipment replacement cycles in the United States and In December 2007, the FASB issued guidance related to other mature markets; unanticipated issues associated with noncontrolling interests later codified under ASC Topic 810, refresh/renovation plans by national restaurant accounts and “Consolidation.” This guidance establishes accounting and global chains; specialty foodservice market growth; growth reporting standards for the noncontrolling interest in a sub- in demand for foodservice equipment by customers in sidiary and for the deconsolidation of a subsidiary. This guid- emerging markets; demand for QSR chains and kiosks; ance clarifies that a noncontrolling interest in a subsidiary is future strength of the beverage industry; the ability to appro- an ownership interest in the consolidated entity that should priately and timely integrate the acquisition of Enodis; realiza- be reported as equity in the consolidated financial state- tion of anticipated earnings enhancements, cost savings, ments. ASC Topic 810 also requires consolidated net income strategic options and other synergies and the anticipated tim- to be reported at amounts that include the amounts attributa- ing to realize those savings, synergies and options. ble to both the parent and the noncontrolling interest. It also Corporate (including factors that may affect both of our requires disclosure, on the face of the consolidated state- segments) — finalization of the price and terms of com- ment of income, of the amounts of consolidated net income pleted and future divestitures and unanticipated issues asso- attributable to the parent and to the noncontrolling interest. ciated with transitional services provided by the company in In addition, ASC Topic 810 provides guidance when a sub- connection with these divestitures; changes in laws and reg- sidiary is deconsolidated and requires expanded disclosures ulations throughout the world; the ability to finance, com- in the consolidated financial statements that clearly identify plete and/or successfully integrate, restructure and and distinguish between the interests of the parent’s owners consolidate acquisitions, divestitures, strategic alliances and and the interests of the noncontrolling owners of a sub- joint ventures; the successful development of innovative sidiary. ASC Topic 810 was effective for fiscal years, and products and market acceptance of new and innovative interim periods within those fiscal years, beginning on or products; issues related to plant closings and/or consolida- after December 15, 2008. The adoption of the noncontrolling tion of existing facilities; efficiencies and capacity utilization interest guidance did not have a significant impact on the of facilities; competitive pricing; availability of certain raw determination or reporting of company’s financial results. materials; changes in raw materials and commodity prices; issues associated with new product introductions; matters Cautionary Statements about Forward-Looking impacting the successful and timely implementation of ERP Information systems; changes in domestic and international economic Statements in this report and in other company communica- and industry conditions, including steel industry conditions; tions that are not historical facts are forward-looking state- changes in the markets we serve; unexpected issues associ- ments, which are based upon our current expectations. ated with the availability of local suppliers and skilled labor; These statements involve risks and uncertainties that could changes in the interest rate environment; risks associated

40 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ba | Sequence: 40 CHKSUM Content: 15302 Layout: 57436 Graphics: No Graphics CLEAN

with growth; foreign currency fluctuations and their impact the ability to generate cash consistent with our stated goals; on reported results and hedges in place; world-wide political non-compliance with debt covenants; changes in tax laws; risk; geographic factors and economic risks; health epi- and unanticipated changes in customer demand. demics; pressure of additional financing leverage resulting from acquisitions; success in increasing manufacturing effi- ITEM 7A. QUANTITATIVE AND QUALITATIVE ciencies and capacities; unanticipated changes in revenue, DISCLOSURES ABOUT MARKET RISK margins, costs and capital expenditures; work stoppages, labor negotiations and rates; issues associated with work- See Liquidity and Capital Resources, and Risk Management force reductions; actions of competitors; unanticipated in Management’s Discussion and Analysis of Financial Con- changes in consumer spending; the ability of our customers dition and Results of Operations for a description of the to obtain financing; the state of financial and credit markets; quantitative and qualitative disclosure about market risk.

The Manitowoc Company, Inc. — 2009 Form 10-K 41

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ca | Sequence: 1 CHKSUM Content: 7213 Layout: 37857 Graphics: No Graphics CLEAN

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Consolidated Financial Statements and Financial Statement Schedule:

Financial Statements:

Report of Independent Registered Public Accounting Firm 43

Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007 44

Consolidated Balance Sheets as of December 31, 2009 and 2008 45

Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007 46

Consolidated Statements of Equity and Comprehensive Income for the years ended December 31, 2009, 2008 and 2007 47

Notes to Consolidated Financial Statements 48

Financial Statement Schedule:

Schedule II — Valuation and Qualifying Accounts for the three years ended December 31, 2009, 2008 and 2007 99

All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

42 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ca | Sequence: 2 CHKSUM Content: 20819 Layout: 288 Graphics: No Graphics CLEAN

Report of Independent Registered Public A company’s internal control over financial reporting is a Accounting Firm process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of To the Stockholders and Board of Directors of financial statements for external purposes in accordance The Manitowoc Company, Inc.: with generally accepted accounting principles. A company’s internal control over financial reporting includes those In our opinion, the consolidated financial statements listed in policies and procedures that (i) pertain to the maintenance the accompanying index present fairly, in all material of records that, in reasonable detail, accurately and fairly respects, the financial position of The Manitowoc Company, reflect the transactions and dispositions of the assets of the Inc. and its subsidiaries (the “Company”) at December 31, company; (ii) provide reasonable assurance that transactions 2009 and 2008, and the results of their operations and their are recorded as necessary to permit preparation of financial cash flows for each of the three years in the period ended statements in accordance with generally accepted account- December 31, 2009 in conformity with accounting principles ing principles, and that receipts and expenditures of the generally accepted in the United States of America. In addi- company are being made only in accordance with authorization, in our opinion, the financial statement schedule listed in tions of management and directors of the company; and the accompanying index presents fairly, in all material (iii) provide reasonable assurance regarding prevention or respects, the information set forth therein when read in timely detection of unauthorized acquisition, use, or disposi- conjunction with the related consolidated financial tion of the company’s assets that could have a material statements. Also in our opinion, the Company maintained, in effect on the financial statements. all material respects, effective internal control over financial Because of its inherent limitations, internal control over reporting as of December 31, 2009, based on criteria estab- financial reporting may not prevent or detect misstatements. lished in Internal Control — Integrated Framework issued by Also, projections of any evaluation of effectiveness to future the Committee of Sponsoring Organizations of the Treadway periods are subject to the risk that controls may become Commission (COSO). The Company’s management is inadequate because of changes in conditions, or that the responsible for these financial statements and financial state- degree of compliance with the policies or procedures may ment schedule, for maintaining effective internal control over deteriorate. financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in /s/ PricewaterhouseCoopers Management’s Report on Internal Control over Financial Milwaukee, Wisconsin Reporting appearing under Item 9A. Our responsibility is to March 1, 2010 express opinions on these financial statements, on the financial statement schedule, and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material mis- statement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. As discussed in Notes 2 and 13 to the consolidated financial statements, the Company changed its method of accounting for uncertain tax benefits in 2007. As discussed in Note 2 and Note 3 to the consolidated financial statements, the Company changed its method of accounting for noncontrolling interests in consolidated subsidiaries effective January 1, 2009.

The Manitowoc Company, Inc. — 2009 Form 10-K 43

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ca | Sequence: 3 CHKSUM Content: 51876 Layout: 50682 Graphics: No Graphics CLEAN

The Manitowoc Company, Inc. Consolidated Statements of Operations For the years ended December 31, 2009, 2008 and 2007

Millions of dollars, except per share data 2009 2008 2007 Operations Net sales $3,782.6 $4,503.0 $3,684.0 Costs and expenses: Cost of sales 2,958.0 3,487.2 2,822.5 Engineering, selling and administrative expenses 549.7 455.1 377.9 Amortization expense 39.5 11.6 5.8 Gain on sale of parts line — — (3.3) Pension settlements — — 5.3 Goodwill impairment 548.8 — — Intangible asset impairment 151.2 — — Integration expense 3.6 7.6 — Loss on sale of product lines 3.4—— Restructuring expense 39.6 21.7 — Total costs and expenses 4,293.8 3,983.2 3,208.2 Operating earnings (loss) from continuing operations (511.2) 519.8 475.8 Other income (expenses): Interest expense (174.0) (51.6) (35.1) Amortization of deferred financing fees (28.8) (2.5) (1.1) Loss on debt extinguishment (9.2) (4.1) (12.5) Loss on purchase price hedges — (379.4) — Other income (expense) — net 17.8 (3.0) 9.8 Total other income (expenses) (194.2) (440.6) (38.9) Earnings (loss) from continuing operations before taxes on earnings (705.4) 79.2 436.9 Provision (benefit) for taxes on earnings (58.8) (19.2) 122.1 Earnings (loss) from continuing operations (646.6) 98.4 314.8 Discontinued operations: Earnings (loss) from discontinued operations, net of income taxes of $(3.1), $(16.1) and $(9.1), respectively (35.9) (143.4) 21.9 Gain (loss) on sale of discontinued operations, net of income taxes of $(15.0) and $(17.4), respectively (24.2) 53.1 — Net earnings (loss) (706.7) 8.1 336.7 Less: Net loss attributable to noncontrolling interest, net of tax (2.5) (1.9) — Net (loss) earnings attributable to Manitowoc (704.2) 10.0 336.7 Amounts attributable to the Manitowoc common shareholders: Earnings (loss) from continuing operations (644.1) 100.3 314.8 Earnings (loss) from discontinued operations, net of income taxes (35.9) (143.4) 21.9 Gain (loss) on sale of discontinued operations, net of income taxes (24.2) 53.1 — Net earnings (loss) attributable to Manitowoc $ (704.2) $ 10.0 $ 336.7 Per Share Data Basic earnings (loss) per common share: Earnings (loss) from continuing operations attributable to Manitowoc common shareholders $ (4.94) $ 0.77 $ 2.53 Earnings (loss) from discontinued operations attributable to Manitowoc common shareholders (0.28) (1.10) 0.18 Gain (loss) on sale of discontinued operations, net of income taxes (0.19) 0.41 — Earnings (loss) per share attributable to Manitowoc common shareholders $ (5.41) $ 0.08 $ 2.70 Diluted earnings (loss) per common share: Earnings (loss) from continuing operations attributable to Manitowoc common shareholders $ (4.94) $ 0.76 $ 2.47 Earnings (loss) from discontinued operations attributable to Manitowoc common shareholders (0.28) (1.09) 0.17 Gain (loss) on sale of discontinued operations, net of income taxes (0.19) 0.40 — Earnings (loss) per share attributable to Manitowoc common shareholders $ (5.41) $ 0.08 $ 2.64

The accompanying notes are an integral part of these financial statements.

44 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ca | Sequence: 4 CHKSUM Content: 48195 Layout: 36069 Graphics: No Graphics CLEAN

The Manitowoc Company, Inc. Consolidated Balance Sheets As of December 31, 2009 and 2008

Millions of dollars, except share data 2009 2008 Assets Current Assets: Cash and cash equivalents $ 105.8 $ 173.0 Marketable securities 2.6 2.6 Restricted cash 6.5 5.1 Accounts receivable, less allowances of $47.3 and $36.4, respectively 323.2 608.2 Inventories — net 595.5 925.3 Deferred income taxes 142.0 138.1 Other current assets 84.3 177.9 Current assets of discontinued operation — 124.8 Total current assets 1,259.9 2,155.0 Property, plant and equipment — net 673.7 728.8 Goodwill 1,246.8 1,890.5 Other intangible assets — net 957.4 1,009.0 Other non-current assets 140.9 179.7 Long-term assets of discontinued operation — 123.1 Total assets $4,278.7 $6,086.1 Liabilities and Equity Current Liabilities: Accounts payable and accrued expenses $ 801.6 $1,206.3 Short-term borrowings and current portion of long-term debt 144.9 182.3 Customer advances 71.2 48.5 Product warranties 96.5 102.0 Product liabilities 28.0 34.4 Current liabilities of discontinued operation — 44.6 Total current liabilities 1,142.2 1,618.1 Non-Current Liabilities: Long-term debt, less current portion 2,027.5 2,473.0 Deferred income taxes 214.8 283.7 Pension obligations 47.4 48.0 Postretirement health and other benefit obligations 58.8 55.9 Long-term deferred revenue 31.8 56.3 Other non-current liabilities 149.0 228.8 Total non-current liabilities 2,529.3 3,145.7 Commitments and contingencies (Note 17) Equity: Common stock (300,000,000 shares authorized, 163,175,928 shares issued, 130,708,124 and 130,359,554 shares outstanding, respectively) 1.4 1.4 Additional paid-in capital 444.4 436.1 Accumulated other comprehensive income 61.8 68.5 Retained earnings 188.7 903.4 Treasury stock, at cost (32,467,804 and 32,816,374 shares, respectively) (88.4) (88.9) Total Manitowoc stockholders’ equity 607.9 1,320.5 Noncontrolling interest (0.7) 1.8 Total equity 607.2 1,322.3 Total liabilities and equity $4,278.7 $6,086.1

The accompanying notes are an integral part of these financial statements.

The Manitowoc Company, Inc. — 2009 Form 10-K 45

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ca | Sequence: 5 CHKSUM Content: 60715 Layout: 62093 Graphics: No Graphics CLEAN

The Manitowoc Company, Inc. Consolidated Statements of Cash Flows For the years ended December 31, 2009, 2008 and 2007 Millions of dollars 2009 2008 2007 Cash Flows From Operations Net earnings (loss) $(706.7) $ 8.1 $ 336.7 Adjustments to reconcile net earnings to cash provided by operating activities of continuing operations: Discontinued operations, net of income taxes 35.9 143.4 (21.9) Asset impairments 700.0 — — Pension settlements — — (5.3) Loss (gain) from sale of parts or product lines 3.4 — (3.3) Depreciation 91.6 80.2 80.2 Amortization of intangible assets 39.5 11.6 5.8 Amortization of deferred financing fees 28.8 5.7 1.1 Deferred income taxes (91.5) 6.9 17.7 Loss on purchase price hedges — 379.4 — Restructuring expense 39.6 21.7 — Gain on sale of segment — (53.1) — Loss on early extinguishment of debt 9.2 4.1 2.3 Loss (gain) on sale of property, plant and equipment 4.6 (3.6) (4.3) Loss on sale of discontinued operations 24.2 — — Other 5.3 6.5 6.2 Changes in operating assets and liabilities, excluding the effects of business acquisitions or dispositions: Accounts receivable 301.6 (25.4) (126.4) Inventories 349.4 (179.9) (75.1) Other assets 7.2 (49.9) (23.7) Accounts payable (307.9) 35.2 20.8 Accrued expenses and other liabilities (171.5) (104.4) 4.8 Net cash provided by operating activities of continuing operations 362.7 286.5 215.6 Net cash provided by (used for) operating activities of discontinued operations (24.1) 22.5 28.4 Net cash provided by operating activities 338.6 309.0 244.0 Cash Flows From Investing Capital expenditures (72.5) (150.3) (112.8) Proceeds from sale of property, plant and equipment 4.6 10.0 9.8 Restricted cash (1.4) 11.6 (1.6) Business acquisitions, net of cash acquired — (2,030.6) (79.9) Settlement of hedges related to acquisition — (379.4) — Proceeds from sale of business 149.2 118.5 — Proceeds from sale of parts or product lines 15.0 — 4.8 Purchase of marketable securities — (0.1) (0.1) Net cash provided by (used for) investing activities of continuing operations 94.9 (2,420.3) (179.8) Net cash used for investing activities of discontinued operations — (4.9) (6.8) Net cash provided by (used for) investing activities 94.9 (2,425.2) (186.6) Cash Flows From Financing Net proceeds from issuance of common stock — — 157.1 Payments on long-term debt (593.8) (693.8) (123.5) Proceeds from long-term debt 136.3 2,769.3 19.8 Proceeds from (payments on) revolving credit facility — net (17.0) (54.6) 56.7 Payments on notes financing — net (5.4) (3.8) (4.3) Debt issuance costs (18.1) (90.8) — Dividends paid (10.5) (10.4) (9.5) Exercises of stock options including windfall tax benefits 2.0 8.5 27.6 Net cash provided by (used for) financing activities of continuing operations (506.5) 1,924.4 123.9 Net cash provided by financing activities of discontinued operations — 2.5 — Net cash provided by (used for) financing activities (506.5) 1,926.9 123.9 Effect of exchange rate changes on cash 5.8 (4.6) 10.7 Net increase (decrease) in cash and cash equivalents (67.2) (193.9) 192.0 Balance at beginning of year 173.0 366.9 174.9 Balance at end of year $ 105.8 $ 173.0 $ 366.9 Supplemental Cash Flow Information Interest paid $ 154.4 $ 23.7 $ 41.5 Income taxes paid (refunded) $ (45.6) $ 142.7 $ 141.8 The accompanying notes are an integral part of these financial statements. 46 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.ca | Sequence: 6 CHKSUM Content: 48224 Layout: 1412 Graphics: No Graphics CLEAN

The Manitowoc Company, Inc. Consolidated Statements of Equity and Comprehensive Income For the years ended December 31, 2009, 2008 and 2007 Millions of dollars, except shares data 2009 2008 2007 Common Stock — Shares Outstanding Balance at beginning of year 130,359,554 129,880,734 62,121,862 Stock options exercised 169,270 485,168 936,105 Two-for-one stock split — — 62,799,852 Stock swap for stock options exercised — (15,048) (6,385) Restricted stock 179,300 8,700 29,300 Issuance of common stock — — 4,000,000 Balance at end of year 130,708,124 130,359,554 129,880,734 Common Stock — Par Value Balance at beginning of year $ 1.4 $ 1.4 $ 0.7 Issuance of common stock — — 0.1 Two-for-one stock split — — 0.6 Balance at end of year $ 1.4 $ 1.4 $ 1.4 Additional Paid-in Capital Balance at beginning of year $ 436.1 $ 419.8 $ 231.8 Issuance of common stock — — 156.8 Two-for-one stock split — — (0.6) Stock options exercised 0.7 3.1 7.1 Restricted stock expense 1.5 1.9 2.0 Windfall tax benefit on stock options exercised 0.8 4.8 16.5 Stock option expense 5.3 6.5 6.2 Balance at end of year $ 444.4 $ 436.1 $ 419.8 Accumulated Other Comprehensive Income Balance at beginning of year $68.5 $114.5 $48.0 Foreign currency translation adjustments (0.4) (29.6) 47.4 Derivative instrument fair market adjustment, net of income taxes of $1.8, $(4.0) and $(0.4) 3.4 (7.3) (0.7) Employee pension and postretirement benefits, net of income taxes of $(5.3), $(4.9) and $10.7 (9.7) (9.1) 19.8 Balance at end of year $ 61.8 $ 68.5 $ 114.5 Retained Earnings Balance at beginning of year $ 903.4 $ 903.8 $ 587.4 Adoption of ASC Topic 740-10 — — (10.8) Net earnings (loss) (704.2) 10.0 336.7 Cash dividends (10.5) (10.4) (9.5) Balance at end of year $ 188.7 $ 903.4 $ 903.8 Treasury Stock Balance at beginning of year $ (88.9) $ (89.6) $ (93.4) Stock options exercised 0.5 0.7 3.8 Balance at end of year $ (88.4) $ (88.9) $ (89.6) Equity attributable to Manitowoc shareholders $ 607.9 $ 1,320.5 $ 1,349.9 Noncontrolling Interest Balance at beginning of year 1.8—— Acquisitions — 3.8 — Comprehensive loss attributable to noncontrolling interest (2.5) (1.9) — Foreign currency translation adjustments — (0.1) — Balance at end of year $ (0.7) $ 1.8 $ — Total equity 607.2 1,322.3 1,349.9 Comprehensive Income Net earnings (loss) $ (706.7) $ 8.1 $ 336.7 Other comprehensive income (loss): Foreign currency translation adjustments (0.4) (29.6) 47.4 Derivative instrument fair market adjustment, net of income taxes 3.4 (7.3) (0.7) Employee pension and postretirement benefits, net of income taxes (9.7) (9.1) 19.8 Total comprehensive income (loss) (713.4) (37.9) 403.2 Comprehensive loss attributable to noncontrolling interest (2.5) (1.9) — Comprehensive income (loss) attributable to Manitowoc $ (710.9) $ (36.0) $ 403.2 The accompanying notes are an integral part of these financial statements. The Manitowoc Company, Inc. — 2009 Form 10-K 47

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 1 CHKSUM Content: 19349 Layout: 41597 Graphics: No Graphics CLEAN

Notes to Consolidated Financial Statements Basis of Presentation The consolidated financial statements include the accounts of The Manitowoc Company, Inc. and 1. Company and Basis of Presentation its wholly and majority-owned subsidiaries. All significant intercompany balances and transactions have been elimi- Company Founded in 1902, The Manitowoc Company, Inc. nated. The preparation of financial statements in conformity and its subsidiaries (collectively referred to as “we” or the with accounting principles generally accepted in the United “company” or Manitowoc) is a multi-industry, capital goods States of America requires management to make estimates manufacturer in two principal markets: Cranes and Related and assumptions that affect the reported amounts of assets Products (Crane) and Foodservice Equipment (Foodservice). and liabilities, disclosure of contingent assets and liabilities The Crane business is a global provider of engineered lift at the date of the financial statements, and the reported solutions which designs, manufactures and markets a com- amounts of revenues and expenses during the reporting prehensive line of lattice-boom crawler cranes, mobile tele- period. Actual results could differ from these estimates. scopic cranes, tower cranes, and boom trucks. The Crane Certain prior period amounts have been reclassified to products are principally marketed under the Manitowoc, conform to the current period presentation. The company’s Grove, Potain, and National brand names and are used in a presentation of the Consolidated Balance Sheets, Consoli- wide variety of applications, including energy, petrochemical dated Statements of Operations, and Consolidated State- and industrial projects, infrastructure development such as ments of Comprehensive Income have been retroactively road, bridge and airport construction and commercial and adjusted to conform with the requirements of Accounting high-rise residential construction. Our crane-related product Standards Codification (ASC) Topic 810, “Noncontrolling support services are principally marketed under the Crane Interest in Consolidated Financial Statements”. Care brand name and include maintenance and repair serv- During the quarter ended September 30, 2009, the com- ices and parts supply. pany identified an adjustment to the income tax provision On October 27, 2008, the company completed its acquisi- that should have been included in its previously filed finan- tion of Enodis plc (Enodis), a global leader in the design and cial statements on Form 10-K for the year ended manufacture of innovative equipment for the commercial December 31, 2008. The issue was discovered during the foodservice industry. This acquisition, the largest and most process of reconciling the income tax provision in the finan- recent acquisition for the company, has established the cial statements to the 2008 income tax return and the company among the world’s top manufacturers of commer- required adjustment resulted in a decrease in income tax cial foodservice equipment. Our Foodservice products are expense, an increase in refundable income taxes and an marketed under the Manitowoc, Garland, U.S. Range, increase in retained earnings of $20.7 million, which has Convotherm, Cleveland, Lincoln, Merrychef, Frymaster, been reflected in the accompanying financial statements, for Delfield, Kolpak, Kysor Panel, Kysor Warren, Jackson, Servend, the year ended December 31, 2008. The adjustment also Multiplex, and Manitowoc Beverage System brand names. resulted in an increase to the company’s previously reported Our Foodservice capabilities now span refrigeration, ice- 2008 earnings per diluted share by $0.16. There was no making, cooking, food-preparation, and beverage-dispensing impact to the 2008 cash flows from operating activities as technologies, and allow us to equip entire commercial the increase in net earnings was offset by the increase in kitchens and serve the world’s growing demand for food refundable income taxes. prepared away from home. We do not believe that the adjustments to the provision In order to secure clearance for the acquisition of Enodis for income taxes, refundable income taxes, and retained from various regulatory authorities including the European earnings described above are material to the company’s Commission and the United States Department of Justice, results of operations, financial position or cash flows for any Manitowoc agreed to sell substantially all of Enodis’ global ice of the company’s previously filed annual or quarterly finan- machine operations following completion of the transaction. cial statements. Accordingly, the December 31, 2008 finan- On May 15, 2009, the company completed the sale of the cial statements included herein have been revised to reflect Enodis global ice machine operations to Braveheart Acquisition, the adjustment to income tax expense, refundable income Inc., an affiliate of Warburg Pincus Private Equity X, L.P., for taxes and retained earnings discussed above. $160 million. The businesses sold were operated under the During the fourth quarter the company identified adjust- Scotsman, Ice-O-Matic, Simag, Barline, Icematic, and Oref ments to correct an error to the amortization of deferred brand names. The company also agreed to sell certain non-ice financing fees that reduce the expenses recognized in the businesses of Enodis located in Italy that are operated under most recently filed Quarterly Reports for each of the first the Tecnomac and Icematic brand names. Prior to disposal, three quarters of 2009 by $0.4 million, $5.8 million, and the antitrust clearances required that the ice businesses were $5.0 million, respectively. The net-of-tax effect of these treated as standalone operations, in competition with Mani- adjustments increases the company’s previously reported towoc. The results of these operations have been classified 2009 earnings per share by $0.00, $0.03, and $0.02 for the as discontinued operations. quarters ended March 31, June 30 and September 30, On December 31, 2008, the company completed the sale of respectively. These adjustments also increase the unamor- its Marine segment to Fincantieri Marine Group Holdings Inc., tized portion of deferred financing fees included in long term a subsidiary of Fincantieri — Cantieri Navali Italiani SpA. The assets by $11.2 million, increase income taxes payable and sale price in the all-cash deal was approximately $120 million. deferred tax liabilities by $4.3 million, and increase retained The results of the Marine segment have been classified as a earnings by $6.9 million as of September 30, 2009. discontinued operation.

48 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 2 CHKSUM Content: 33657 Layout: 29962 Graphics: No Graphics CLEAN

There was no impact to quarterly cash flows in 2009 as the Expenditures for major renewals and improvements that sub- increase in net earnings was offset by the decrease in the stantially extend the capacity or useful life of an asset are non-cash reconciling items for deferred financing fee amorti- capitalized and are then depreciated. The cost and accumu- zation and deferred taxes. The company does not believe that lated depreciation for property, plant and equipment sold, these adjustments are material to the results of operations, retired, or otherwise disposed of are relieved from the financial position or cash flows for any of its previously filed accounts, and resulting gains or losses are reflected in earn- quarterly financial statements. Accordingly, the company will ings. Property, plant and equipment are depreciated over the revise its 2009 quarterly financial statements prospectively estimated useful lives of the assets using the straight-line within its 2010 Quarterly Reports on Form 10-Q. depreciation method for financial reporting and on accelerated methods for income tax purposes. 2. Summary of Significant Accounting Policies Property, plant and equipment are depreciated over the following estimated useful lives: Cash Equivalents, Restricted Cash and Marketable Securities All short-term investments purchased with an original maturity Years of three months or less are considered cash equivalents. Mar- Building and improvements 2-40 ketable securities at December 31, 2009 and 2008 are recorded Machinery, equipment and tooling 2-20 at fair value and include securities which are considered “available for sale.” The difference between fair market value Furniture and fixtures 5-20 and cost of these investments was not significant for either Computer hardware and software 2-5 year. Restricted cash represents cash in escrow funds related to the security for an indemnity agreement for our casualty Property, plant and equipment also include cranes accounted insurance provider as well as funds held in escrow to support for as operating leases. Equipment accounted for as operat- certain international cash pooling programs. ing leases includes equipment leased directly to the customer and equipment for which the company has assisted in the Inventories Inventories are valued at the lower of cost or financing arrangement whereby it has guaranteed more than market value. Approximately 90% of the company’s invento- insignificant residual value or made a buyback commitment. ries at December 31, 2009 and 2008, respectively, were val- Equipment that is leased directly to the customer is ued using the first-in, first-out (FIFO) method. The remaining accounted for as an operating lease with the related assets inventories were valued using the last-in, first-out (LIFO) method. capitalized and depreciated over their estimated economic If the FIFO inventory valuation method had been used exclu- life. Equipment involved in a financing arrangement is depre- sively, inventories would have increased by $32.4 million and ciated over the life of the underlying arrangement so that the $35.8 million at December 31, 2009 and 2008, respectively. net book value at the end of the period equals the buyback Finished goods and work-in-process inventories include amount or the residual value amount. The amount of rental material, labor and manufacturing overhead costs. equipment included in property, plant and equipment amounted to $89.9 million and $100.3 million, net of accu- Goodwill and Other Intangible Assets The company mulated depreciation, at December 31, 2009 and 2008, accounts for its goodwill and other intangible assets under respectively. the guidance of ASC Topic 350-10, “Intangibles — Goodwill and Other.” Under ASC Topic 350-10, goodwill is not Impairment of Long-Lived Assets The company reviews amortized, but it is tested for impairment annually, or more long-lived assets for impairment whenever events or frequently, as events dictate. See additional discussion of changes in circumstances indicate that the assets carrying impairment testing under “Impairment of Long-Lived amount may not be recoverable. The company conducts its Assets,” below. The company’s other intangible assets with long-lived asset impairment analyses in accordance with indefinite lives, including trademarks and tradenames and ASC Topic 360-10-5. ASC Topic 360-10-5 requires the com- in-place distributor networks, are not amortized, but are also pany to group assets and liabilities at the lowest level for tested for impairment annually, or more frequently, as events which identifiable cash flows are largely independent of the dictate. The company’s other intangible assets subject to cash flows of other assets and liabilities and to evaluate the amortization are tested for impairment whenever events or asset group against the sum of the undiscounted future changes in circumstances indicate that their carrying values cash flows. may not be recoverable. Other intangible assets are amortized For property, plant and equipment and other long-lived over the following estimated useful lives: assets, other than goodwill and other indefinite lived intangible assets, the company performs undiscounted operating Useful lives cash flow analyses to determine impairments. If an impair- Patents 10-20 years ment is determined to exist, any related impairment loss is calculated based upon comparison of the fair value to the Engineering drawings 15 years net book value of the assets. Impairment losses on assets Customer relationships 10-20 years held for sale are based on the estimated proceeds to be Property, Plant and Equipment Property, plant and equipment received, less costs to sell. are stated at cost. Expenditures for maintenance, repairs and Each year, in its second quarter, the company tests for minor renewals are charged against earnings as incurred. impairment of goodwill according to a two-step approach. In

The Manitowoc Company, Inc. — 2009 Form 10-K 49

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 3 CHKSUM Content: 15377 Layout: 21101 Graphics: No Graphics CLEAN

the first step, the company estimates the fair values of its The goodwill and other indefinite-lived intangible assets had reporting units using the present value of future cash flows a carrying value of $1,598.0 million and $368.0 million, approach, subject to a comparison for reasonableness to its respectively, prior to the impairment charges. These non-cash market capitalization at the date of valuation. If the carrying impairment charges had no direct impact on the company’s amount exceeds the fair value, the second step of the good- cash flows, liquidity, debt covenants, debt position or tangi- will impairment test is performed to measure the amount of ble asset values. There is no tax benefit in relation to the the impairment loss, if any. In the second step the implied goodwill impairment; however, the company did recognize a fair value of the goodwill is estimated as the fair value of the $52.0 million benefit associated with the other indefinite- reporting unit used in the first step less the fair values of all lived intangible asset impairment. other net tangible and intangible assets of the reporting unit. As of June 30, 2009, the company performed its annual If the carrying amount of the goodwill exceeds its implied impairment analysis relative to goodwill and indefinite-lived fair market value, an impairment loss is recognized in an intangible assets and based on those results determined no amount equal to that excess, not to exceed the carrying additional impairment had occurred subsequent to the amount of the goodwill. In addition, goodwill of a reporting impairment charges recorded in the first quarter of 2009. unit is tested for impairment between annual tests if an At March 31, 2009, in conjunction with the preparation of event occurs or circumstances change that would more its financial statements, the company concluded triggering likely than not reduce the fair value of a reporting unit below events occurred requiring an evaluation of the impairment of its carrying value. For other indefinite lived intangible assets, its other long-lived assets due to continued weakness in the impairment test consists of a comparison of the fair global market conditions, tight credit markets and the per- value of the intangible assets to their carrying amount. formance of the Crane and Foodservice segments. This During the first quarter of 2009, the company’s stock price analysis did not indicate the other long-lived assets were continued to decline as global market conditions remained impaired. depressed, the credit markets did not improve and the per- A considerable amount of management judgment and formance of the company’s Crane and Foodservice segments assumptions are required in performing the impairment was below the company’s expectations. In connection with tests, principally in determining the fair value of the assets. a reforecast of expected 2009 financial results completed in While the company believes its judgments and assumptions early April 2009, the company determined the foregoing cir- were reasonable, different assumptions could change the cumstances to be indicators of potential impairment under estimated fair values and, therefore, impairment charges the guidance of ASC Topic 350-10. Therefore, the company could be required. performed the required initial (“Step One”) impairment test We will continue to monitor market conditions and deter- for each of the company’s operating units as of March 31, mine if any additional interim review of goodwill, other intan- 2009. The company re-performed its established method of gibles, or other long-lived assets is warranted. Further present-valuing future cash flows, taking into account the deterioration in the market or actual results as compared company’s updated projections, to determine the fair value with our projections may ultimately result in a future impair- of the reporting units. The determination of fair value of the ment. In the event we determine that goodwill or other long- reporting units requires the company to make significant lived tangible or intangible assets are impaired in the future, estimates and assumptions. The fair value measurements we would need to recognize a non-cash impairment charge, (for both goodwill and indefinite-lived intangible assets) are which could have a material adverse effect on our consoli- considered Level 3 within the fair value hierarchy. These esti- dated balance sheet and results of operations. mates and assumptions primarily include, but are not limited to, projections of revenue growth, operating earnings, dis- Warranties Estimated warranty costs are recorded in cost count rates, terminal growth rates, and required capital for of sales at the time of sale of the warranted products based each reporting unit. Due to the inherent uncertainty involved on historical warranty experience for the related product or in making these estimates, actual results could differ materi- estimates of projected costs due to specific warranty issues ally from the estimates. The company evaluated the signifi- on new products. These estimates are reviewed periodically cant assumptions used to determine the fair value of each and are adjusted based on changes in facts, circumstances reporting unit, both individually and in the aggregate, and con- or actual experience. cluded they are reasonable. The results of the analysis indicated that the fair values of Environmental Liabilities The company accrues for losses three of the company’s eight reporting units (Foodservice associated with environmental remediation obligations Americas; Foodservice Europe, Middle East, and Africa; and when such losses are probable and reasonably estimable. Foodservice Retail) were potentially impaired: therefore, the Such accruals are adjusted as information develops or cir- company proceeded to measure the amount of the potential cumstances change. Costs of long-term expenditures for impairment (“Step Two”) with the assistance of a third-party environmental remediation obligations are discounted to valuation firm. Upon completion of that assessment, the their present value when the timing of cash flows are company recognized impairment charges as of March 31, estimable. 2009, of $548.8 million related to goodwill. The company Product Liabilities The company records product liability also recognized impairment charges of $151.2 million related reserves for its self-insured portion of any pending or threat- to other indefinite-lived intangible assets as of March 31, ened product liability actions. The reserve is based upon two 2009. Both charges were within the Foodservice segment. estimates. First, the company tracks the population of all

50 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 4 CHKSUM Content: 35311 Layout: 59341 Graphics: No Graphics CLEAN

outstanding pending and threatened product liability cases recorded in the Consolidated Balance Sheets at fair value. to determine an appropriate case reserve for each based The effective portion of the contracts’ gains or losses due to upon the company’s best judgment and the advice of legal changes in fair value are initially recorded as a component of counsel. These estimates are continually evaluated and AOCI and are subsequently reclassified into earnings when adjusted based upon changes to facts and circumstances the hedge transactions, typically sales and costs related to surrounding the case. Second, the company determines the sales, occur and affect earnings. These contracts are highly amount of additional reserve required to cover incurred but effective in hedging the variability in future cash flows attrib- not reported product liability issues and to account for possi- utable to changes in currency exchange rates, commodity ble adverse development of the established case reserves prices, or interest rates. (collectively referred to as IBNR). This analysis is performed at least twice annually. Fair Value Hedges The company periodically enters into interest rate swaps designated as a hedge of the fair value Foreign Currency Translation The financial statements of of a portion of its fixed rate debt. These hedges effectively the company’s non-U.S. subsidiaries are translated using the result in changing a portion of its fixed rate debt to variable current exchange rate for assets and liabilities and the aver- interest rate debt. Both the swaps and the hedged portion age exchange rate for the year for income and expense of the debt are recorded in the Consolidated Balance Sheets items. Resulting translation adjustments are recorded to at fair value. The change in fair value of the swaps should Accumulated Other Comprehensive Income (AOCI) as a exactly offset the change in fair value of the hedged debt, component of Manitowoc stockholders’ equity. with no net impact to earnings. Interest expense of the hedged debt is recorded at the variable rate in earnings. As Derivative Financial Instruments and Hedging Activities The of December 31, 2009 and 2008, the company had no intercompany has written policies and procedures that place all est rate swaps in place that converted fixed rate debt to vari- financial instruments under the direction of corporate treas- able rate debt. ury and restrict all derivative transactions to those intended The company selectively hedges cash inflows and out- for hedging purposes. The use of financial instruments for flows that are subject to foreign currency exposure from the trading purposes is strictly prohibited. The company uses date of transaction to the related payment date. The hedges financial instruments to manage the market risk from for these foreign currency accounts receivable and accounts changes in foreign exchange rates, commodities and interest payable are classified as fair value hedges in accordance rates. The company follows the guidance in accordance with with ASC Topic 815-10 and are recorded in the Consolidated ASC Topic 815-10, “Derivatives and Hedging”. The fair values Balance Sheets at fair value. Gains or losses due to changes of all derivatives are recorded in the Consolidated Balance in fair value are recorded as an adjustment to earnings in the Sheets. The change in a derivative’s fair value is recorded Consolidated Statements of Operations. each period in current earnings or AOCI depending on whether the derivative is designated and qualifies as part of a Stock-Based Compensation At December 31, 2009, the hedge transaction and if so, the type of hedge transaction. company has five stock-based compensation plans, which For the year ended December 31, 2008, a $379.4 million are described more fully in Note 16, “Stock Based Compen- hedge loss was recognized in operating earnings related to sation.” Effective January 1, 2006, the company adopted hedging transactions entered into to hedge the Great British ASC Topic 718-10, “Compensation-Stock Compensation” Pound (GBP) purchase price of Enodis. Under the guidance which requires all share-based payments to employees, of ASC Topic 815-10, “Derivatives and Hedging,” hedges of a including grants of employee stock options, to be measured firm commitment to acquire a business do not qualify for at fair value and expensed in the Consolidated Statements hedge accounting (or balance sheet) treatment. Therefore, of Operations over the service period (generally the vesting the periodic market value changes in these hedges are period) of the grant. Upon adoption, the company transi- required to go through the income statement. During 2009 tioned to using the modified prospective application, under and 2008, minimal amounts were recognized in earnings which compensation expense is only recognized in the Con- due to ineffectiveness of certain commodity hedges and for solidated Statements of Operations beginning with the first the year ended 2007, no amount was recognized in earnings period that ASC Topic 718-10 was effective and continuing due to ineffectiveness of hedge transactions. The amount to be expensed thereafter. The company recognizes expense reported as derivative instrument fair market value adjust- for all stock-based compensation with graded vesting on a ment in the AOCI account within Manitowoc stockholders’ straight-line basis over the vesting period of the entire equity represents the net gain (loss) on foreign exchange award. In addition to the compensation expense related to currency exchange contracts and commodity contracts des- stock options, the company recognized $1.5 million, ignated as cash flow hedges, net of income taxes. $1.9 million and $2.0 million of compensation expense related to restricted stock during the years ended Cash Flow Hedge The company selectively hedges antici- December 31, 2009, 2008 and 2007, respectively. pated transactions that are subject to foreign exchange exposure, commodity price exposure, or variable interest Revenue Recognition Revenue is generally recognized and rate exposure, primarily using foreign currency exchange earned when all the following criteria are satisfied with contracts, commodity contracts, and interest rate swaps, regard to a specific transaction: persuasive evidence of a respectively. These instruments are designated as cash flow sales arrangement exists; the price is fixed or determinable; hedges in accordance with ASC Topic 815-10 and are collectability of cash is reasonably assured; and delivery has

The Manitowoc Company, Inc. — 2009 Form 10-K 51

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 5 CHKSUM Content: 28863 Layout: 47226 Graphics: No Graphics CLEAN

occurred or services have been rendered. Shipping and handling Comprehensive Income Comprehensive income includes, fees are reflected in net sales and shipping and handling in addition to net earnings, other items that are reported as costs are reflected in cost of sales in the Consolidated State- direct adjustments to Manitowoc stockholders’ equity. Cur- ments of Operations. rently, these items are foreign currency translation adjust- The company enters into transactions with customers that ments, employee postretirement benefit adjustments and provide for residual value guarantees and buyback commit- the change in fair value of certain derivative instruments. ments on certain crane transactions. The company records transactions which it provides significant residual value guar- Concentration of Credit Risk Credit extended to customers antees and any buyback commitments as operating leases. through trade accounts receivable potentially subjects the Net revenues in connection with the initial transactions are company to risk. This risk is limited due to the large number recorded as deferred revenue and are amortized to income of customers and their dispersion across various industries on a straight-line basis over a period equal to that of the cus- and many geographical areas. However, a significant tomer’s third party financing agreement. See Note 18, amount of the company’s receivables are with distributors “Guarantees.” and contractors in the construction industry, large compa- The company also leases cranes to customers under oper- nies in the foodservice and beverage industry, customers ating lease terms. Revenue from operating leases is recog- servicing the U.S. steel industry, and government agencies. nized ratably over the term of the lease, and leased cranes The company currently does not foresee a significant credit are depreciated over their estimated useful lives. risk associated with these individual groups of receivables, but continues to monitor the exposure due to the current Research and Development Research and development global economic conditions. costs are charged to expense as incurred and amounted to $59.0 million, $40.0 million and $36.1 million for the years Recent Accounting Changes and Pronouncements In ended December 31, 2009, 2008 and 2007, respectively. October 2009, the FASB issued Accounting Standards Research and development costs include salaries, materials, Update 2009-13, “Multiple-Deliverable Revenue Arrange- contractor fees and other administrative costs. ments,” codified in ASC Topic 605. This update provides application guidance on whether multiple deliverables exist, Income Taxes The company utilizes the liability method to how the deliverables should be separated and how the con- recognize deferred tax assets and liabilities for the expected sideration should be allocated to one or more units of future income tax consequences of events that have been accounting. This guidance establishes a selling price hierar- recognized in the company’s financial statements. Under chy for determining the selling price of a deliverable. The this method, deferred tax assets and liabilities are deter- selling price used for each deliverable will be based on ven- mined based on the temporary difference between financial dor-specific objective evidence, if available, third-party evi- statement carrying amounts and the tax basis of assets and dence if vendor-specific objective evidence is not available, liabilities using enacted tax rates in effect in the years in or estimated selling price if neither vendor-specific or third- which the temporary differences are expected to reverse. party evidence is available. The company will be required to Valuation allowances are provided for deferred tax assets apply this guidance prospectively for revenue arrangements where it is considered more likely than not that the company entered into or materially modified in the fiscal year begin- will not realize the benefit of such assets. ning on or after June 15, 2010, with early application permit- In June 2006, the FASB issued new guidance codified pri- ted. The company is currently evaluating the impact that marily in ASC Topic 740, “Income Taxes”. This guidance clari- adoption of this guidance will have on the determination or fies the accounting for uncertainty in income taxes reporting of the company’s financial results. recognized in an entity’s financial statements. It prescribes a In June 2009, the FASB issued new guidance codified in recognition threshold and measurement attribute for finan- ASC Topic 105, which establishes the FASB Accounting Stan- cial statement disclosure of tax positions taken or expected dards Codification (“Codification”) to become the single to be taken on a tax return. This guidance was effective for source of accounting principles and the framework for select- the company on January 1, 2007 and upon adoption, the ing the principles used in the preparation of financial state- company recognized an additional tax liability of $10.8 million ments of nongovernmental entities that are presented in and a corresponding reduction in retained earnings recorded conformity with generally accepted accounting principles in as a cumulative effect of an accounting change in the first the United States. Rules and interpretive releases of the SEC quarter of 2007. under authority of federal securities laws are also sources of authoritative generally accepted accounting principles for Earnings Per Share Basic earnings per share is computed by SEC registrants. All existing accounting standards are super- dividing net earnings by the weighted average number of seded as described in ASC Topic 105. All other accounting lit- common shares outstanding during each year or period. erature not included in the Codification is nonauthoritative. Diluted earnings per share is computed similar to basic earn- This guidance is effective for interim and annual periods end- ings per share except that the weighted average shares out- ing after September 15, 2009. The adoption of this guidance standing is increased to include shares of restricted stock and did not have a significant impact on the determination or the number of additional shares that would have been out- reporting of the company’s financial results. standing if stock options were exercised and the proceeds In June 2009, the FASB issued new guidance codified from such exercise were used to acquire shares of common primarily in ASC Topic 810, “Consolidation.” This guidance is stock at the average market price during the year or period. related to the consolidation rules applicable to variable interest

52 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 6 CHKSUM Content: 57057 Layout: 651 Graphics: No Graphics CLEAN

entities. It replaces the quantitative-based risks and rewards This guidance also eliminates the requirement to disclose an calculation for determining whether an enterprise is the pri- estimate of the range of possible outcomes of recognized mary beneficiary in a variable interest entity with an approach contingencies at the acquisition date. For unrecognized con- that is primarily qualitative and requires ongoing assessments tingencies, the FASB requires that entities include only the of whether an enterprise is the primary beneficiary of a variable disclosures required by ASC Topic 450. This guidance was interest entity. This guidance also requires additional disclo- adopted effective January 1, 2009. There was no significant sures about an enterprise’s involvement in variable interest impact upon adoption, and its effects on future periods will entities and is effective for the company in its interim and depend on the nature and significance of business combina- annual reporting periods beginning on and after January 1, tions subject to this statement. 2010. The company is currently evaluating the impact that the In December 2008, the FASB issued new guidance which adoption of this guidance will have on the determination or is codified primarily in ASC Topic 715, “Compensation — reporting of its financial results. Retirement Benefits.” This guidance is related to an In June 2009, the FASB issued guidance related to the employer’s disclosures about the type of plan assets held in accounting for transfers of financial assets codified primarily a defined benefit pension or other postretirement plan. This in ASC Topic 860, “Transfers and Servicing.” This guidance guidance is effective for financial statements issued for fis- requires entities to provide more information about transfers cal years ending after December 15, 2009. The adoption of of financial assets and a transferor’s continuing involvement, this guidance did not have a material impact on the consoli- if any, with transferred financial assets. It also requires addi- dated financial statements. tional disclosures about the risks that a transferor continues In December 2007, the FASB issued additional guidance to be exposed to because of its continuing involvement in ASC Topic 805, “Business Combinations”, which establishes transferred financial assets. ASC Topic 860 eliminates the principles and requirements for how the acquirer: (a) recog- concept of a qualifying special-purpose entity and changes nizes and measures in its financial statements the identifiable the requirements for de-recognition of financial assets. This assets acquired, the liabilities assumed, and any noncontrol- Topic is effective for the company in its interim and annual ling interest in the acquiree; (b) recognizes and measures the reporting periods beginning on and after January 1, 2010. goodwill acquired in the business combination or a gain from The company is currently evaluating the impact that the a bargain purchase; and (c) determines what information to adoption of ASC Topic 860 will have on the reporting of its disclose to enable users of the financial statements to evalu- financial results. ate the nature and financial effects of the business combina- In May 2009, the FASB issued new guidance codified pri- tion. The guidance also requires contingent consideration to marily in ASC Topic 855, “Subsequent Events.” This guid- be recognized at its fair value on the acquisition date and, for ance was issued in order to establish principles and certain arrangements, changes in fair value to be recognized requirements for reviewing and reporting subsequent events in earnings until settled. ASC Topic 805 also requires acquisi- and requires disclosure of the date through which subse- tion-related transaction and restructuring costs to be quent events are evaluated and whether the date corre- expensed rather than treated as part of the cost of the acqui- sponds with the time at which the financial statements were sition. This guidance applies prospectively to business com- available for issue (as defined) or were issued. This guidance binations for which the acquisition date is on or after the is effective for interim reporting periods ending after beginning of the first annual reporting period beginning on or June 15, 2009. The adoption of this guidance did not have a after December 15, 2008. The adoption of this guidance on material impact on the consolidated financial statements. January 1, 2009 did not have a significant impact on the con- Refer to Note 26, “Subsequent Events,” for the required dis- solidated financial statements. closures in accordance with ASC Topic 855. In December 2007, the FASB issued guidance related to In April 2009, the FASB issued new guidance codified pri- noncontrolling interests later codified under ASC Topic 810, marily in ASC Topic 825, “Financial Instruments.” This guid- “Consolidation.” This guidance establishes accounting and ance requires an entity to provide disclosures about fair reporting standards for the noncontrolling interest in a sub- value of financial instruments in interim financial information sidiary and for the deconsolidation of a subsidiary. This guid- and is to be applied prospectively and is effective for interim ance clarifies that a noncontrolling interest in a subsidiary is and annual periods ending after June 15, 2009 with early an ownership interest in the consolidated entity that should adoption permitted for periods ending after March 15, 2009. be reported as equity in the consolidated financial state- The adoption of this guidance did not have a material impact ments. ASC Topic 810 also requires consolidated net income on the consolidated financial statements. Refer to Note 5, to be reported at amounts that include the amounts attributa- “Fair Value of Financial Instruments,” for the disclosures ble to both the parent and the noncontrolling interest. It also required in accordance with this guidance. requires disclosure, on the face of the consolidated state- In April 2008, the FASB issued new guidance which is ment of income, of the amounts of consolidated net income codified primarily in ASC Topic 805, “Business Combina- attributable to the parent and to the noncontrolling interest. tions.” This guidance requires that assets acquired and liabil- In addition, ASC Topic 810 provides guidance when a sub- ities assumed in a business combination that arise from sidiary is deconsolidated and requires expanded disclosures contingencies be recognized at fair value if fair value can be in the consolidated financial statements that clearly identify reasonably estimated. If fair value cannot be reasonably esti- and distinguish between the interests of the parent’s owners mated, the asset or liability would generally be recognized in and the interests of the noncontrolling owners of a sub- accordance with ASC Topic 450. Further, the FASB removed sidiary. ASC Topic 810 was effective for fiscal years, and the subsequent accounting guidance for assets and interim periods within those fiscal years, beginning on or liabilities arising from contingencies from ASC Topic 805. after December 15, 2008. The adoption of the noncontrolling The Manitowoc Company, Inc. — 2009 Form 10-K 53

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 7 CHKSUM Content: 6953 Layout: 24746 Graphics: No Graphics CLEAN

interest guidance did not have a significant impact on the The following information reflects the results of Manitowoc’s determination or reporting of company’s financial results. operations for the years ended December 31, 2008 and 2007 on a pro forma basis as if the acquisition of Enodis had 3. Acquisitions been completed on January 1, 2008 and January 1, 2007, respectively. Pro forma adjustments have been made to On October 27, 2008, Manitowoc acquired 100% of the issued illustrate the incremental impact on earnings of interest and to be issued shares of Enodis. Enodis was a global costs on the borrowings to acquire Enodis, amortization leader in the design and manufacture of innovative equip- expense related to acquired intangible assets of Enodis, ment for the commercial foodservice industry. This acquisition, depreciation expense related to the fair value of the acquired the largest and most recent acquisition for Manitowoc, has depreciable tangible assets and the tax benefit associated established Manitowoc among the world’s top manufacturers with the incremental interest costs and amortization and of commercial foodservice equipment. With this acquisition, depreciation expense. The following unaudited pro forma the Foodservice segment capabilities now span refrigeration, information includes $9.5 million of additional expense ice-making, warewashing, cooking, food-preparation, and related to the fair value adjustment of inventories and beverage-dispensing technologies, and allow Manitowoc to excludes certain cost savings or operating synergies (or be able to equip entire commercial kitchens and serve the costs associated with realizing such savings or synergies) world’s growing demand for food prepared away from home. that may result from the acquisition. The aggregate purchase price was $2.1 billion in cash, exclusive of the settlement of related hedges and there are (in $ millions, except per share data) 2008 2007 no future contingent payments or options. The following Revenue table summarizes the fair values of the assets acquired and Pro forma $5,679.9 $4,947.5 liabilities assumed at the date of acquisition. As reported 4,503.0 3,684.0 Earnings (loss) from continuing operations At October 27, 2008 (Date of Acquisition): Pro forma $ (95.5) $ 215.1 Cash $ 56.9 As reported 98.4 314.8 Accounts receivable, net 157.9 Diluted earnings (loss) per share Inventory, net 150.7 from continuing operations Other current assets 54.4 Pro forma $ (0.74) $ 1.69 Current assets of discontinued operation 118.7 As reported 0.76 2.47 Total current assets 538.6 Property, plant and equipment 168.5 The unaudited pro forma information is provided for illus- Intangible assets 955.0 trative purposes only and does not purport to represent Goodwill 1,308.9 what our consolidated results of operations would have Other non-current assets 40.9 been had the transaction actually occurred as of January 1, Non-current assets of discontinued operation 337.0 2008, or January 1, 2007, and does not purport to project Total assets acquired 3,348.9 our future consolidated results of operations. Accounts payable 317.6 In conjunction with the acquisition of Enodis, certain restructuring activities have been undertaken to recognize Other current liabilities 33.4 cost synergies and rationalize the new cost structure of the Current liabilities of discontinued operation 58.1 Foodservice segment. Amounts included in the acquisition Total current liabilities 409.1 cost allocation for these activities are summarized in the Long-term debt, less current portion 382.4 following table and recorded in accounts payable and Other non-current liabilities 470.3 accrued expenses in the Consolidated Balance Sheets: Non-current liabilities of discontinued operation 26.5 The company recorded additional amounts in 2009 of Total liabilities assumed 1,288.3 $7.8 million, $5.5 million, and $14.2 million related to employee Net assets acquired $2,060.6 termination benefits, facility closure costs, and other, respectively, in conjuction with the finalization of the restructuring Of the $955 million of acquired intangible assets, plans. These plans are expected to conclude in 2011. $371.0 million was assigned to registered trademarks and tradenames that are not subject to amortization, $165.0 million At October 27, 2008: was assigned to developed technology with a weighted aver- Employee involuntary termination benefits $17.1 age useful life of 15 years, and the remaining $419.0 million Facility closure costs 34.7 was assigned to customer relationships with a weighted Other 19.2 average useful life of 20 years. All of the $1,308.9 million of Total $71.0 goodwill was assigned to the Foodservice segment, none of which is expected to be deductible for tax purposes. See The company has not presented pro-forma financial infor- further detail related to the goodwill and other intangible mation for the following acquisitions due to the immaterial assets of the Enodis acquisition at Note 9, “Goodwill and Other Intangible Assets.”

54 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 8 CHKSUM Content: 31267 Layout: 2560 Graphics: No Graphics CLEAN

dollar amount of the transactions and the immaterial impact 2009 2008 2007 on our results of operations: Net sales $ — $381.3 $321.0 On March 6, 2008, the company formed a 50% joint venture Pretax earnings (loss) from with the shareholders of Tai’An Dongyue Heavy Machinery Co., Ltd. (Tai’An Dongyue) for the production of mobile and truck- discontinued operation $(2.5) $ 53.2 $ 26.1 mounted hydraulic cranes. The joint venture is located in Tai’An Gain on sale, net of income taxes City, Shandong Province, China. The company has significant of $0 and $(17.4) 1.0 53.1 — voting and other rights that give it substantial control over the Provision (benefit) for taxes on earnings (0.3) (18.1) (7.3) operations of Tai’An Dongyue, and accordingly, the results of Net earnings (loss) from discontinued this joint venture are consolidated by the company. On operation $(1.2) $ 88.2 $ 18.8 January 1, 2009, the company adopted ASC Topic 810 and has reflected the new requirements in the presentation of its finan- In addition to the former Marine segment, the company cial statements. Tai’An Dongyue is the company’s only sub- has classified the Enodis ice and related businesses as dis- sidiary impacted by the new guidance. The aggregate continued in compliance with ASC Topic 360-10, “Property, consideration for the joint venture interest in Tai’An Dongyue Plant, and Equipment.” was $32.5 million and resulted in $23.5 million of goodwill and In order to secure clearance for the acquisition of Enodis $8.5 million of other intangible assets being recognized by the from various regulatory authorities including the European company’s Crane segment. See further detail related to the Commission and the United States Department of Justice, goodwill and other intangible assets of the Tai’An Dongyue the company agreed to sell substantially all of Enodis’ global acquisition at Note 9, “Goodwill and Other Intangible Assets.” ice machine operations following completion of the transac- On July 19, 2007, the company acquired Shirke Construc- tion. On May 15, 2009, the company completed the sale of tion Equipments Pvt. Ltd (Shirke) for an aggregate consider- the Enodis global ice machine operations to Braveheart ation of $64.5 million including approximately $1.3 million of Acquisition, Inc., an affiliate of Warburg Pincus Private acquisition costs. Headquartered in Pune, India, Shirke is a Equity X, L.P., for $160 million. The businesses sold were market leader in the Indian tower crane industry and has operated under the Scotsman, Ice-O-Matic, Simag, Barline, been Potain’s Indian manufacturing partner and distributor Icematic, and Oref brand names. The company also agreed since 1982. The aggregate consideration paid for Shirke to sell certain non-ice businesses of Enodis located in Italy resulted in $33.8 million of goodwill and $30.2 million of that are operated under the Tecnomac and Icematic brand other intangible assets being recognized by the company’s names. Prior to disposal, the antitrust clearances required Crane segment. See further detail related to the goodwill that the ice businesses were treated as standalone opera- and other intangible assets of the Shirke acquisition at tions, in competition with the company. The results of these Note 9, “Goodwill and Other Intangible Assets.” operations have been classified as discontinued operations. The company used the net proceeds from the sale of the 4. Discontinued Operations Enodis global ice machine operations of approximately On December 31, 2008, the company completed the sale of $150 million to reduce the balance on Term Loan X that its Marine segment to Fincantieri Marine Group Holdings Inc., matures in April of 2010. The final sale price resulted in the a subsidiary of Fincantieri — Cantieri Navali Italiani SpA. The company recording an additional $28.8 million non-cash sale price in the all-cash deal was approximately $120 million. impairment charge to reduce the value of the Enodis global The results of the Marine segment have been classified as a ice machine operations in the first quarter of 2009. As a discontinued operation. result of the impairment charge and the loss from discontin- The following selected financial data of the Marine seg- ued operations related to divested businesses of $4.9 million ment for the years ended December 31, 2009, 2008 and in 2009, the loss from discontinued operations related to the 2007 is presented for informational purposes only and does Enodis global ice machine operations was $33.7 million. In not necessarily reflect what the results of operations would addition, the company realized an after tax loss of $25.2 mil- have been had the business operated as a stand-alone lion on the sale of the Enodis global ice machine operations entity. There was no general corporate expense or interest in 2009. The loss on sale was primarily driven by a taxable expense allocated to discontinued operations for this busi- gain related to the assets held in the United States for U.S. ness during the periods presented. tax purposes.

The Manitowoc Company, Inc. — 2009 Form 10-K 55

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 9 CHKSUM Content: 28133 Layout: 56477 Graphics: No Graphics CLEAN

5. Fair Value of Financial Instruments

The company adopted ASC Topic 820-10, “Fair Value Measurements and Disclosures” effective January 1, 2008. The following tables set forth the company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2009 and December 31, 2008 by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

Fair Value as of December 31, 2009 Level 1 Level 2 Level 3 Total Current Assets: Foreign currency exchange contracts $ 1.4 $ — $— $ 1.4 Forward commodity contracts — 1.7 — 1.7 Marketable securities 2.6 — — 2.6 Total Current assets at fair value $ 4.0 $1.7 $— $ 5.7 Current Liabilities: Foreign currency exchange contracts $ 5.4 $ — $— $ 5.4 Forward commodity contracts — 0.1 — 0.1 Total Current liabilities at fair value $ 5.4 $0.1 $— $ 5.5 Non-current Liabilities: Interest rate swap contracts $ — $6.4 $— $ 6.4 Total Non-current liabilities at fair value $ — $6.4 $— $ 6.4

Fair Value as of December 31, 2009 Level 1 Level 2 Level 3 Total Current Assets: Foreign currency exchange contracts $ 5.5 $ — $— $ 5.5 Marketable securities 2.6 — — 2.6 Total Current assets at fair value $ 8.1 $ — $— $ 8.1 Current Liabilities: Foreign currency exchange contracts $10.7 $ — $— $10.7 Forward commodity contracts — 6.4 — 6.4 Total Current liabilities at fair value $10.7 $6.4 $— $17.1 The carrying value of the amounts reported in the Consoli- Inputs other than quoted prices that are observable dated Balance Sheets for cash, accounts receivable, for the asset or liability accounts payable, retained interest in receivables sold and Level 3 Unobservable inputs for the asset or liability short-term variable debt, including any amounts outstanding under our revolving credit facility, approximate fair value, The company endeavors to utilize the best available infor- without being discounted, due to the short periods during mation in measuring fair value. Financial assets and liabilities which these amounts are outstanding. The fair value of the are classified in their entirety based on the lowest level of 1 company’s 7 ⁄8% Senior Notes due 2013 was approximately input that is significant to the fair value measurement. The $143.1 million and $108.4 million at December 31, 2009 and company has determined that its financial assets and liabili- December 31, 2008, respectively. The fair values of the com- ties are level 1 and level 2 in the fair value hierarchy. pany’s term loans under the New Credit Agreement are as As a result of its global operating and financing activities, follows at December 31, 2009 and December 31, 2008, the company is exposed to market risks from changes in respectively: Term Loan A — $883.3 million and $768.8 million; interest and foreign currency exchange rates and commodity Term Loan B — $1,011.3 million and $890.4 million; and Term prices, which may adversely affect our operating results and Loan X — $0 million and $158.6 million. See Note 11, “Debt,” financial position. When deemed appropriate, the company for the related carrying values of these debt instruments. minimizes its risks from interest and foreign currency ASC Topic 820-10 defines fair value as the price that would exchange rate and commodity price fluctuations through the be received to sell an asset or paid to transfer a liability in an use of derivative financial instruments. Derivative financial orderly transaction between market participants at the meas- instruments are used to manage risk and are not used for urement date. ASC Topic 820-10 classifies the inputs used to trading or other speculative purposes, and the company does measure fair value into the following hierarchy: not use leveraged derivative financial instruments. The for- Level 1 Unadjusted quoted prices in active markets for ward foreign currency exchange and interest rate swap con- identical assets or liabilities tracts and forward commodity purchase agreements are Level 2 Unadjusted quoted prices in active markets for sim- valued using broker quotations, or market transactions in ilar assets or liabilities, or either the listed or over-the-counter markets. As such, these Unadjusted quoted prices for identical or similar derivative instruments are classified within level 1 and level 2. assets or liabilities in markets that are not active, or 56 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 10 CHKSUM Content: 14740 Layout: 63211 Graphics: No Graphics CLEAN

6. Derivative Financial Instruments with ASC Topic 815-10, the company designates commodity, currency forward contracts, interest rate swaps as cash flow On January 1, 2009, the company adopted ASC Topic 815-10, hedges of forecasted purchases of commodities and curren- “Derivatives and Hedging” which requires enhanced disclo- cies, and variable rate interest payments. sures regarding an entity’s derivative and hedging activities For derivative instruments that are designated and qualify as provided below. as cash flow hedges, the effective portion of the gain or loss The company’s risk management objective is to ensure on the derivative is reported as a component of other com- that business exposures to risk that have been identified prehensive income and reclassified into earnings in the and measured and are capable of being controlled are mini- same period or periods during which the hedged transaction mized using the most effective and efficient methods to affects earnings. Gains and losses on the derivative instru- eliminate, reduce, or transfer such exposures. Operating ments representing either hedge ineffectiveness or hedge decisions consider associated risks and structure transac- components excluded from the assessment of effective- tions to avoid risk whenever possible. ness, are recognized in current earnings. In the next twelve Use of derivative instruments is consistent with the overall months the company estimates $2.3 million of unrealized business and risk management objectives of the company. and realized gains related to interest rate, commodity price Derivative instruments may be used to manage business and currency rate hedging will be reclassified from Other risk within limits specified by the company’s Risk Policy and Comprehensive Income into earnings. Foreign currency and manage exposures that have been identified through the risk commodity hedging is generally completed prospectively on identification and measurement process, provided that they a rolling basis for twelve and eighteen months, respectively. clearly qualify as “hedging” activities as defined in the Risk As of December 31, 2009, the company had the following Policy. Use of derivative instruments is not automatic, nor is outstanding interest rate, commodity and currency forward it necessarily the only response to managing pertinent busi- contracts that were entered into as hedge forecasted trans- ness risk. Use is permitted only after the risks that have actions: been identified are determined to exceed defined tolerance levels and are considered to be unavoidable. Commodity Units Hedged Type The primary risks managed by the company by using Aluminum 1,400 MT Cash Flow derivative instruments are interest rate risk, commodity price Copper 424 MT Cash Flow risk and foreign currency exchange risk. Interest rate swap instruments are entered into to help manage interest rate Natural Gas 266,934 MMBtu Cash Flow fluctuation risk. Forward contracts on various commodities are entered into to help manage the price risk associated Short Currency Units Hedged Type with forecasted purchases of materials used in the com- Canadian Dollar 24,426,423 Cash Flow pany’s manufacturing process. The company also enters Euro 51,155,115 Cash Flow into various foreign currency derivative instruments to help South Korean Won 2,079,494,400 Cash Flow manage foreign currency risk associated with the com- Singapore Dollar 3,240,000 Cash Flow pany’s projected purchases and sales and foreign currency United States Dollar 12,285,292 Cash Flow denominated receivable and payable balances. ASC Topic 815-10 requires companies to recognize all As of December 31, 2009, the total notional amount of the derivative instruments as either assets or liabilities at fair company’s receive-floating/pay-fixed interest rate swaps value in the statement of financial position. In accordance was $984.0 million.

For derivative instruments that are not designated as hedging instruments under ASC Topic 815-10, the gains or losses on the derivatives are recognized in current earnings within Cost of Sales or Other income, net.

Short Currency Units Hedged Recognized Location Purpose Great British Pound 30,385,738 Other income, net Accounts Payable and Receivable Settlement Euro 37,310,399 Other income, net Accounts Payable and Receivable Settlement United States Dollar 42,383,351 Other income, net Accounts Payable and Receivable Settlement

The fair value of outstanding derivative contracts recorded as assets in the accompanying Consolidated Balance Sheet as of December 31, 2009 was as follows:

ASSET DERIVATIVES 2009 Balance Sheet Location Fair Value Derivatives designated as hedging instruments Foreign Exchange Contracts Other current assets $1.4 Commodity Contracts Other current assets 1.5 Total derivatives designated as hedging instruments $2.9

The Manitowoc Company, Inc. — 2009 Form 10-K 57

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 11 CHKSUM Content: 13680 Layout: 10685 Graphics: No Graphics CLEAN

ASSET DERIVATIVES 2009 Balance Sheet Location Fair Value Derivatives NOT designated as hedging instruments Commodity Contracts Other current assets $0.2 Total derivatives NOT designated as hedging instruments $0.2 Total asset derivatives $3.1

The fair value of outstanding derivative contracts recorded as liabilities in the accompanying Consolidated Balance Sheet as of December 31, 2009 was as follows:

LIABILITY DERIVATIVES 2009 Balance Sheet Location Fair Value Derivatives designated as hedging instruments Foreign Exchange Contracts Accounts payable and accrued expenses $0.5 Interest Rate Swap Contracts Other non-current liabilities 6.4 Commodity Contracts Accounts payable and accrued expenses 0.1 Total derivatives designated as hedging instruments $7.0

LIABILITY DERIVATIVES 2009 Balance Sheet Location Fair Value Derivatives NOT designated as hedging instruments Foreign Exchange Contracts Accounts payable and accrued expenses $ 4.9 Total derivatives NOT designated as hedging instruments $ 4.9 Total liability derivatives $11.9

The effect of derivative instruments on the consolidated statement of operations for the twelve months ended December 31, 2009 and gains or losses initially recognized in Other Comprehensive Income (OCI) in the consolidated balance sheet was as follows:

Location of Gain or (Loss) Amount of Gain or (Loss) Amount of Gain or (Loss) Reclassified from Reclassified from Recognized in OCI on Accumulated OCI into Accumulated OCI into Derivative (Effective Income (Effective Income (Effective Derivatives in Cash Flow Hedging Relationships Portion, net of tax) Portion) Portion) Foreign Exchange Contracts $ 0.6 Cost of Sales $ (5.5) Interest Rate Swap Contracts (4.2) Interest Expense (11.3) Commodity Contracts 0.9 Cost of Sales (4.4) Total $(2.7) $(21.2)

Location of Gain or (Loss) Amount of Gain or (Loss) Recognized in Income on Recognized in Income on Derivative (Ineffective Portion and Derivative (Ineffective Portion and Amount Excluded from Amount Excluded from Derivatives in Cash Flow Hedging Relationships Effectiveness Testing) Effectiveness Testing) Commodity Contracts Cost of Sales $0.2 Total $0.2

Location of Gain or (Loss) Amount of Gain or (Loss) Recognized in Income on Recognized in Income on Derivatives Not Designated as Hedging Instruments Derivative Derivative Foreign Exchange Contracts Other Income $(5.0) Commodity Contracts Cost of Sales (1.2) Total $(6.2)

58 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 12 CHKSUM Content: 62401 Layout: 20900 Graphics: No Graphics CLEAN

During July 2008, the company entered into foreign cur- During 2009, a reduction in inventories related to working rency hedging transactions (the “hedges”) to comply with the capital initiatives resulted in a liquidation of applicable LIFO requirements of its credit commitment needed to fund the inventory quantities carried at lower costs in prior years. This purchase of Enodis. The hedges were required by the com- LIFO liquidation resulted in a $3.2 million cost of sales pany’s lenders to limit the company’s exposure to fluctua- decrease. tions in the underlying GBP purchase price of the Enodis shares which could have ultimately required additional fund- 8. Property, Plant and Equipment ing in excess of available commitment amounts. Subsequent to entering into the hedging transactions, the U.S. Dollar The components of property, plant and equipment at strengthened against the GBP which resulted in a significant December 31 are summarized as follows: change to the fair value of the underlying hedges. Under the guidance of ASC Topic 815-10, “Derivatives and Hedging,” 2009 2008 hedges of a firm commitment to acquire a business do not Land $ 57.8 $ 69.2 qualify for hedge accounting (or balance sheet) treatment. Building and improvements 367.7 303.6 Therefore, the periodic market value changes in these hedges Machinery, equipment and tooling 547.3 408.1 were required to go through the income statement. The final Furniture and fixtures 41.6 32.7 disposition of these hedge positions was determined based Computer hardware and software 90.2 64.2 upon the market exchange rate on November 6, 2008, the Rental cranes * 140.8 165.2 date the funding transaction was completed. For the year ended December 31, 2008, the loss on these currency Construction in progress 68.8 96.9 hedges related to the purchase of Enodis was $379.4 million. Total cost 1,314.2 1,139.9 Less accumulated depreciation (640.5) (411.1) 7. Inventories Property, plant and equipment — net $ 673.7 $ 728.8 The components of inventories at December 31 are sum- * Accumulated depreciation for Rental cranes for the years ended marized as follows: December 31, 2009 and 2008 was $51.0 million and $64.9 million, respectively. 2009 2008 Inventories — gross: Raw materials $244.5 $ 416.0 Work-in-process 163.5 262.9 Finished goods 310.8 352.3 Total 718.8 1,031.2 Less excess and obsolete inventory reserve (90.9) (70.1) Net inventories at FIFO cost 627.9 961.1 Less excess of FIFO costs over LIFO value (32.4) (35.8) Inventories — net $595.5 $ 925.3

9. Goodwill and Other Intangible Assets

The changes in carrying amount of goodwill by reportable segment for the years ended December 31, 2009 and 2008, were as follows: Crane Foodservice Total Balance as of January 1, 2008 $271.5 $ 200.1 $ 471.6 Tai’An Dongyue acquisition 23.5 — 23.5 Enodis acquisition — 1,393.8 1,393.8 Foreign currency impact (9.5) 11.1 1.6 Balance as of December 31, 2008 285.5 1,605.0 1,890.5 Enodis purchase accounting adjustments — (84.9) (84.9) Sale of product lines — (9.3) (9.3) Foreign currency impact 4.2 (4.9) (0.7) Balance as of December 31, 2009 $289.7 $1,505.9 $1,795.6 Asset impairments — (548.8) (548.8) Balance as of December 31, 2009 $289.7 $ 957.1 $1,246.8

The Manitowoc Company, Inc. — 2009 Form 10-K 59

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 13 CHKSUM Content: 33590 Layout: 19980 Graphics: No Graphics CLEAN

The decrease in goodwill of $84.9 million for the year ended $548.8 million related to goodwill. The company also recog- December 31, 2009, was due to completion of the purchase nized impairment charges of $151.2 million related to other accounting allocation associated with the acquisition of indefinite-lived intangible assets as of March 31, 2009. Both Enodis. See further discussion in Note 3, “Acquisitions.” charges were within the Foodservice segment. The goodwill The company accounts for goodwill and other intangible and other indefinite-lived intangible assets had a carrying assets under the guidance of ASC Topic 350-10, “Intangibles — value of $1,598.0 million and $368.0 million, respectively, prior Goodwill and Other.” Under ASC Topic 350-10, goodwill is no to the impairment charges. These non-cash impairment longer amortized; however, the company performs an annual charges have no direct impact on the company’s cash flows, impairment review at June 30 of every year or more frequently liquidity, debt covenants, debt position or tangible asset val- if events or changes in circumstances indicate that the asset ues. There is no tax benefit in relation to the goodwill impair- might be impaired. The company performs impairment reviews ment; however, the company did recognize a $52.0 million for its reporting units, which have been determined to be: benefit associated with the other indefinite-lived intangible Cranes Americas; Cranes Europe, Middle East, and Africa; asset impairment. Cranes Asia; Crane Care; Foodservice Americas; Foodservice As of June 30, 2009, the company performed its annual Europe, Middle East, and Africa; Foodservice Asia; and Food- impairment analysis relative to goodwill and indefinite-lived service Retail, using a fair-value method based on the present intangible assets and based on those results no additional value of future cash flows, which involves management’s judg- impairment had occurred subsequent to the impairment ments and assumptions about the amounts of those cash charges recorded in the first quarter of 2009. The company flows and the discount rates used. The estimated fair value is will continue to monitor market conditions and determine if then compared with the carrying amount of the reporting unit, any additional interim reviews of goodwill, other intangibles including recorded goodwill. Goodwill and other intangible or long-lived assets are warranted. Further deterioration in assets are then subject to risk of write-down to the extent that the market or actual results as compared with the com- the carrying amount exceeds the estimated fair value. pany’s projections may ultimately result in a future impair- During the first quarter of 2009, the company’s stock price ment. In the event the company determines that assets are continued to decline as global market conditions remained impaired in the future, the company would need to recog- depressed, the credit markets did not improve and the per- nize a non-cash impairment charge, which could have a formance of the company’s Crane and Foodservice seg- material adverse effect on the company’s consolidated bal- ments was below the company’s expectations. In connection ance sheet and results of operations. with a reforecast of expected 2009 financial results com- As discussed in Note 3, “Acquisitions,” on October 27, 2008, pleted in early April 2009, the company determined the fore- the company acquired 100% of the issued and to be issued going circumstances to be indicators of potential impairment shares of Enodis plc. Enodis was a global leader in the under the guidance of ASC Topic 350-10. Therefore, the com- design and manufacture of innovative equipment for the pany performed the required initial (“Step One”) impairment commercial foodservice industry. The aggregate purchase test for each of the company’s operating units as of price of $2,060.6 million resulted in a preliminary allocation March 31, 2009. The company re-performed its established of $819.0 million to identifiable intangible assets and method of present-valuing future cash flows, taking into $1,393.8 million to goodwill. Of the $819.0 million of account the company’s updated projections, to determine acquired intangible assets, $339.0 million was assigned to the fair value of the reporting units. The determination of fair registered trademarks and tradenames that are not subject value of the reporting units requires the company to make to amortization, $165.0 million was assigned to developed significant estimates and assumptions. The fair value meas- technology with a weighted average useful life of 15 years, urements (for both goodwill and indefinite-lived intangible and the remaining $315.0 million was assigned to customer assets) are considered Level 3 within the fair value hierarchy. relationships with a weighted average useful life of 20 years. These estimates and assumptions primarily include, but are All of the $1,393.8 million of goodwill was assigned to the not limited to, projections of revenue growth, operating earn- Foodservice segment. ings, discount rates, terminal growth rates, and required capi- Also discussed in Note 3, “Acquisitions,” during 2008, the tal for each reporting unit. Due to the inherent uncertainty company formed a 50% joint venture with the shareholders involved in making these estimates, actual results could dif- of Tai’An Dongyue for the production of mobile and truck- fer materially from the estimates. The company evaluated the mounted hydraulic cranes. The joint venture is located in significant assumptions used to determine the fair value of Tai’An City, Shandong Province, China. The aggregate con- each reporting unit, both individually and in the aggregate, sideration for the joint venture interest in Tai’An Dongyue and concluded they are reasonable. was $32.5 million and resulted in $23.5 million of goodwill The results of the analysis indicated that the fair values of and $8.5 million of other intangible assets being recognized three of the company’s eight reporting units (Foodservice by the company’s Crane segment. The other intangible Americas; Foodservice Europe, Middle East, and Africa; and assets consist of trademarks of $1.0 million, which have an Foodservice Retail) were potentially impaired: therefore, the indefinite life, customer relationships of $0.9 million, which company proceeded to measure the amount of the potential have been assigned a 10-year life, and other intangibles of impairment (“Step Two”) with the assistance of a third-party $6.6 million, which consist primarily of crane manufacturing valuation firm. Upon completion of that assessment, the com- licenses and have been assigned a 10-year life. pany recognized impairment charges as of March 31, 2009, of

60 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 14 CHKSUM Content: 30248 Layout: 28762 Graphics: No Graphics CLEAN

The gross carrying amount and accumulated amortization of the company’s intangible assets other than goodwill were as follows as of December 31, 2009 and December 31, 2008. December 31, 2009 December 31, 2008 Gross Net Gross Net Carrying Accumulated Book Carrying Accumulated Book Amount Amortization Value Amount Amortization Value Trademarks and tradenames $ 341.0 $ — $341.0 $ 458.3 $ — $ 458.3 Customer relationships 438.9 (28.9) 410.0 334.6 (5.5) 329.1 Patents 35.1 (19.4) 15.7 34.5 (16.5) 18.0 Engineering drawings 11.8 (6.2) 5.6 11.6 (5.4) 6.2 Distribution network 21.7 — 21.7 21.4 — 21.4 Other intangibles 185.9 (22.5) 163.4 184.9 (8.9) 176.0 $1,034.4 $(77.0) $957.4 $1,045.3 $(36.3) $1,009.0

The gross carrying amount of trademarks and tradenames was reduced by $151.2 million based on the asset impairment charges as discussed above for the year ended December 31, 2009. In addition, in connection with the completion of the valua- tions associated with the assets acquired in the Enodis acquisition, the company increased the value assigned to customer relationships by $129.0 million and the value assigned to trademarks and tradenames by $32.0 million. Amortization expense for the years ended December 31, 2009, 2008 and 2007 was $39.5 million, $11.6 million and $5.8 million, respectively. Amortization expense related to intangible assets for each of the five succeeding years is estimated to be approximately $38 million per year.

10. Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses at December 31 are summarized as follows:

2009 2008 Trade accounts and interest payable $357.3 $ 649.2 Employee related expenses 96.6 120.2 Consolidated Industries litigation reserves — 72.0 Restructuring expenses 61.5 41.1 Profit sharing and incentives 14.0 67.2 Accrued rebates 35.2 45.7 Deferred revenue — current 40.4 49.5 Income taxes payable 25.3 — Derivative liabilities 5.5 17.1 Miscellaneous accrued expenses 165.8 144.3 $801.6 $1,206.3

11. Debt

Debt at December 31 is summarized as follows:

2009 2008 Revolving credit facility $ — $ 17.0 Term loan A 922.5 1,025.0 Term loan B 1,041.0 1,200.0 Term loan X — 181.5 Senior notes due 2013 150.0 150.0 Other 58.9 81.8 Total debt 2,172.4 2,655.3 Less current portion and short-term borrowings (144.9) (182.3) Long-term debt $2,027.5 $2,473.0

In April 2008, the company entered into a $2.4 billion credit agreement which was amended and restated as of August 25, 2008, to ultimately increase the size of the total facility to $2.925 billion (“New Credit Agreement” or “New Credit Facility”). The New Credit Agreement became effective November 6, 2008. The New Credit Agreement includes four loan facilities — a revolving facility of $400.0 million with a five-year term, a Term Loan A of $1,025.0 million with a five-year term, a Term Loan B of $1,200.0 million with a six-year term, and a Term Loan X of $300.0 million with an eighteen-month term. The company is

The Manitowoc Company, Inc. — 2009 Form 10-K 61

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 15 CHKSUM Content: 2288 Layout: 14268 Graphics: No Graphics CLEAN

obligated to prepay the three term loan facilities from the this amendment and along with the existing unamortized debt net proceeds of asset sales, casualty losses, equity offer- fees, are being amortized over the remaining term of the New ings, and new indebtedness for borrowed money, and from Credit Agreement using the effective interest method. Further- a portion of its excess cash flow, subject to certain excep- more, in accordance with ASC Topic 470-50, costs incurred tions. At December 31, 2009 the weighted average interest with third parties of $0.3 million were expensed as incurred. rates for the Term Loan A and the Term Loan B were 5.88% As of December 31, 2009 the company was in compliance and 7.89%, respectively. with all affirmative and negative covenants in its debt instru- In connection with its New Credit Agreement in 2008, the ments inclusive of the financial covenants pertaining to the company incurred $118.3 million in debt issue costs. The cash New Credit Agreement, as amended through December 31, flow impact of these fees, which totaled $90.8 million, is 2009, and the Senior Notes due 2013, and based upon our included in cash flow used for financing activities in the Con- current plans and outlook, we believe we will be able to solidated Statement of Cash Flows for the year ending comply with these covenants during the subsequent December 31, 2008. The non-cash portion of these fees was 12 months. As of December 31, 2009 our Consolidated Total the result of original issue discount on the Term Loan B portion Leverage Ratio was 5.85:1, below the maximum ratio of of the New Credit Facility. 7:125:1 and our Consolidated Interest Coverage Ratio was In June 2009, the company entered into Amendment No. 2 2:29:1, above the minimum ratio of 1.875:1. (the June 2009 Amendment) to the New Credit Agreement to As a result of the June 2009 Amendment of the New Credit provide relief under its consolidated total leverage ratio and Agreement, the company terminated the Term Loan A interest consolidated interest coverage ratio financial covenants. This rate swap entered into in January 2009 resulting in a realized June 2009 Amendment was obtained to avoid a potential gain of $2.0 million and entered into a new interest rate swap financial covenant violation at the end of the second quarter related to Term Loan A. In accordance with ASC Topic 815-10, of 2009 as a result of lower demand for certain of the com- the realized gain will be amortized as an adjustment to interest pany’s products due to continued weakness in the global expense over the life of the original January Term Loan A economy and tight credit markets. Terms of the June 2009 swap. The Amended Term Loan A swap transaction is fixed to Amendment included an increase in the margin on London the 3 month LIBOR interest rate for 50 percent of the notional Interbank Offered Rate (LIBOR) and Alternative Borrowing amount of debt. The Term Loan B swap transaction is fixed to Rate (ABR) loans of between 150 and 175 basis points, the 1 month LIBOR with a 3 percent floor for 50 percent of depending on the consolidated total leverage ratio. Also, one the notional amount of debt. In June 2009 $449.4 million of additional interest rate pricing level was added for each loan Term Loan A was fixed at 2.50% plus a 450 basis point facility above a certain leverage amount. spread, which equals 7.00% and $600.0 million of Term The New Credit Agreement, as amended through Loan B was fixed at 3.64% rate plus a 450 basis point spread, December 31, 2009, contained financial covenants whereby which equals 8.14%. Both interest rate hedges for the Term the ratio of (a) consolidated earnings before interest, taxes, Loan A and Term Loan B are amortizing swaps that have an depreciation and amortization, and other adjustments aggregate weighted average life of three years. The remaining (EBITDA), as defined in the New Credit Agreement to unhedged portions of the Term Loans A and B continue to (b) consolidated interest expense, each for the most recent bear interest at a variable interest rate plus the applicable four fiscal quarters (Consolidated Interest Coverage Ratio) spread according to the New Credit Agreement, as amended. and the ratio of (c) consolidated indebtedness to (d) consoli- As of December 31, 2009 total notional amounts equal to dated EBITDA for the most recent four fiscal quarters (Con- $336.4 million and $648.0 million of fixed rate hedges were solidated Total Leverage Ratio), at all times were updated to outstanding on Term Loans A and B, respectively. new limits as agreed with the company’s lenders. On December 31, 2009, the company also had outstanding 1 In addition, the June 2009 Amendment added a financial $150.0 million of 7 ⁄8% Senior Notes due 2013 (Senior Notes covenant whereby a ratio of (e) consolidated senior secured due 2013). The Senior Notes due 2013 are unsecured senior indebtedness to (f) consolidated EBITDA for the most recent obligations. Our New Credit Facility ranks equally with the four fiscal quarters (Consolidated Senior Secured Indebted- Senior Notes due 2013, except that the New Credit Facility is ness Ratio), beginning with the fiscal quarter ending secured by substantially all domestic tangible and intangible June 30, 2011, was established with certain defined limits assets of the company and its subsidiaries. The Senior Notes as agreed with the company’s lenders. due 2013 are fully and unconditionally jointly and severally The June 2009 Amendment also reduced or eliminated guaranteed by substantially all of the company’s domestic certain options to increase the borrowing capacity of the subsidiaries (see Note 23, “Subsidiary Guarantors of Senior revolving facility or Term Loan A. Additionally, the June 2009 Notes due 2013”). Interest on the Senior Notes due 2013 is Amendment placed certain limitations on capital expenditures, payable semiannually in May and November each year. The restricted payments and acquisitions per calendar year Senior Notes due 2013 can be redeemed by the company in depending on the Consolidated Total Leverage Ratio. The whole or in part for a premium on or after November 1, 2008. New Credit Agreement, as amended, also continued to contain The following would be the premium paid by the company, customary representations and warranties and events of default. expressed as a percentage of the principal amount, if it The company accounted for the June 2009 Amendment redeems the Senior Notes due 2013 during the 12-month under the provisions of ASC Topic 470-50, “Modifications and period commencing on November 1 of the year set forth below: Extinguishments.” As the present value of the cash flows both prior to and after this amendment were not substantially differ- Year Percentage ent, fees of $17.0 million paid by the company to the parties to 2010 101.188% the New Credit Agreement were capitalized in connection with 2011 and thereafter 100.000%

62 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 16 CHKSUM Content: 38179 Layout: 10664 Graphics: No Graphics CLEAN

Our Senior Notes due 2013 contain customary affirmative which closed on February 8, 2010. Refer to Note 26, “Subse- and negative covenants. Among other restrictions, these quent Events,” for additional information. covenants limit our ability to redeem or repurchase our debt, incur additional debt, make acquisitions, merge with other 12. Accounts Receivable Securitization entities, pay dividends or distributions, repurchase capital stock, and create or become subject to liens. The company has entered into an accounts receivable secu- On December 31, 2008, the company completed the sale ritization program whereby it sells certain of its domestic of its Marine segment to Fincantieri Marine Group Holdings, trade accounts receivable to a wholly owned, bankruptcy- Inc., a subsidiary of Fincantieri — Cantieri Navali Italiani SpA. remote special purpose subsidiary which, in turn, sells partici- The sale price in the all-cash transaction was approximately pating interests in its pool of receivables to a third-party $120 million. The company used the cash proceeds, net of a financial institution (Purchaser). The Purchaser receives an preliminary working capital adjustment, to partially pay down ownership and security interest in the pool of receivables. the balance on the Term Loan X of approximately $118.5 million. New receivables are purchased by the special purpose sub- On May 15, 2009 the company completed the sale of the sidiary and participation interests are resold to the Purchaser Enodis global ice machine operations to Braveheart Acquisi- as cash collections reduce previously sold participation inter- tion, Inc., an affiliate of Warburg Pincus Private Equity X, L.P., ests. The company has retained collection and administrative for $160 million. The company used the after-tax net proceeds responsibilities on the participation interests sold. The Pur- of approximately $150 million to reduce the balance on Term chaser has no recourse against the company for uncollectible Loan X. On December 16, 2009, the company paid off the receivables; however, the company’s retained interest in the remaining balance on Term Loan X. receivable pool is subordinate to the Purchaser and is As of December 31, 2009, the company had outstanding recorded at fair value. The securitization program also con- $58.9 million of other indebtedness that has a weighted- tains customary affirmative and negative covenants. Among average interest rate of approximately 6.1%. This debt other restrictions, these covenants require the company to includes outstanding overdraft balances and capital lease lia- meet specified financial tests, which include a consolidated bilities in our Asia-Pacific and European regions. interest coverage ratio and a consolidated total leverage ratio. Prior to November 6, 2008, the company borrowed from On June 29, 2009, the company entered into Amendment its $300.0 million Amended and Restated Credit Agreement, No. 4 to the Amended and Restated Receivables Purchase dated as of December 14, 2006. Borrowings under this five Agreement (Receivables Purchase Agreement) to align the year agreement bore interest at a rate equal to the sum of a included financial covenants ratios with those of the New base rate or a Eurodollar rate plus an applicable margin, Credit Agreement, as amended. As of December 31, 2009, which was based on the company’s consolidated total lever- the company was in compliance with all affirmative and nega- age ratio as defined by the agreement. tive covenants inclusive of the financial covenants pertaining The aggregate scheduled maturities of outstanding debt to the Receivables Purchase Agreement and based upon our obligations in subsequent years are as follows: current plans and outlook, we believe we will be able to comply with these covenants during the subsequent 12 months. 2010 $ 144.9 Due to a short average collection cycle of less than 60 days 2011 169.5 for such accounts receivable and due to the company’s collection history, the fair value of the company’s retained inter- 2012 167.7 est approximates book value. The retained interest recorded 2013 677.6 at December 31, 2009, was $39.4 million and is included in 2014 1,009.6 accounts receivable in the accompanying Consolidated Thereafter 3.1 Balance Sheets. $2,172.4 The securitization program includes certain of the company’s domestic U.S. Foodservice and Crane segment businesses. On January 21, 2010, the company entered into another On September 28, 2009, the company entered into Amend- amendment (January 2010 Amendment) to the Amended and ment No. 5 to the Amended and Restated Receivables Pur- Restated Credit Agreement, dated as of August 25, 2008. The chase Agreement whereby the company modified its January 2010 Amendment, among other things, amends the securitization program to, among other things, increase the definition of Consolidated Earnings Before Interest and Taxes capacity of the program from $105.0 million to $125.0 million (EBIT) to provide add-backs for certain additional cash restruc- and to add two additional businesses under the program. turing charges, and amends certain financial ratios that the On December 17, 2009 and December 31, 2009, respectively, company is required to maintain. See further detail related to the company entered into Amendments No. 6 and 7 to the the January 2010 Amendment at Note 26, “Subsequent Events.” Receivables Purchase Agreement whereby the company modi- On February 3, 2010, in accordance with its previously fied the program to, among other things, add two additional announced intentions, the company entered into an Underwrit- businesses and amended certain defined terms in order to ing Agreement with J.P. Morgan Securities Inc. as represen- update the program for changes in the company’s legal tative of several underwriters, pursuant to which the structure. company agreed to sell, and the underwriters agreed to pur- Incremental sales of trade receivables from the special chase $400 million of the company’s 9.50% Senior Notes purpose subsidiary to the Purchaser totaled $62.5 million for due 2018 to be guaranteed by guarantors in a public offering the year ended December 31, 2009. Cash collections of

The Manitowoc Company, Inc. — 2009 Form 10-K 63

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 17 CHKSUM Content: 24620 Layout: 44660 Graphics: No Graphics CLEAN

trade accounts receivable balances in the total receivable are reflected as a reduction of accounts receivable in the pool totaled $900.7 million for the year ended December 31, accompanying Consolidated Balance Sheets and the proceeds 2009. Trade accounts receivables sold to the Purchaser and received are included in cash flows from operating activities being serviced by the company totaled $68.5 million at in the accompanying Consolidated Statements of Cash Flows. December 31, 2009. The table below provides additional information about The accounts receivables securitization program is accounted delinquencies and net credit losses for trade accounts for as a sale in accordance with ASC Topic 860-10, “Transfers receivable subject to the accounts receivable securitization and Servicing.” Sales of trade receivables to the Purchaser program.

Balance Outstanding Balance 60 Days or More Net Credit Losses Outstanding Past Due Year Ended December 31, 2009 December 31, 2009 December 31, 2009 Trade accounts receivable subject to securitization program $107.9 $5.9 $ — Trade accounts receivable balance sold 68.5 Retained interest $ 39.4

13. Income Taxes

Income tax expense for continuing operations is summarized below: 2009 2008 2007 Earnings (loss) from continuing operations before income taxes: Domestic $(674.5) $ (38.5) $188.8 Foreign (30.9) 117.7 248.1 Total $(705.4) $ 79.2 $436.9

The provision for taxes on earnings (loss) from continuing operations for the years ended December 31, 2009, 2008 and 2007 are as follows: 2009 2008 2007 Current: Federal $ 19.9 $(57.1) $ 64.8 State 4.7 (0.8) 10.3 Foreign 8.1 40.2 42.8 Total current 32.7 (17.7) 117.9 Deferred: Federal and state (47.4) 7.2 (0.1) Foreign (44.1) (8.7) 4.3 Total deferred (91.5) (1.5) 4.2 Provision for taxes on earnings $(58.8) $(19.2) $122.1

The federal statutory income tax rate is reconciled to the company’s effective income tax rate for continuing operations for the years ended December 31, 2009, 2008 and 2007 as follows: 2009 2008 2007 Federal income tax at statutory rate 35.0% 35.0% 35.0% State income provision (benefit) 0.4 (3.5) 1.6 Non-deductible book intangible asset amortization and goodwill impairment (27.3) 0.5 0.1 Federal manufacturing income benefit — — (0.7) Federal tax credits 0.2 (0.9) (0.2) Taxes on foreign income which differ from the U.S. statutory rate 2.0 (60.6) (7.3) Adjustments for unrecognized tax benefits 3.9 3.5 (0.9) Valuation allowances (3.2) — — Other items (2.7) 1.8 0.4 Effective tax rate 8.3% (24.2)% 28.0%

64 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 18 CHKSUM Content: 29769 Layout: 16007 Graphics: No Graphics CLEAN

The effective tax rate for the year ended December 31, 2009 rate for 2009. The tax benefit for the year ended December 31, was 8.3% as compared to negative 24.2% for the year ended 2009 was favorably impacted by the reversal of various December 31, 2008. As the company posted a pre-tax loss in reserves for uncertain tax positions as discussed below. 2009, a positive effective tax rate represents a benefit to the During 2009, the company determined that it was more consolidated statement of operations. In 2008 the company likely than not that the deferred tax assets would not be posted pre-tax income, for which a negative effective tax utilized in several jurisdictions including China, Slovakia, rate represents a benefit to the consolidated statement of Spain, and the United Kingdom. Therefore, the company rec- operations. The goodwill impairment of $548.8 million in 2009 ognized $22.5 million of valuation allowances as income tax is not tax deductible and thus had an unfavorable impact to expense. Both the 2009 and 2008 effective tax rates were the effective tax rate. The write down of the trademarks of also favorably affected, as compared to the statutory rate, to $151.2 million had an associated deferred tax liability of varying degrees by certain global tax planning initiatives. $52.0 million which resulted in no impact to the effective tax

The deferred income tax accounts reflect the impact of temporary differences between the basis of assets and liabilities for financial reporting purposes and their related basis as measured by income tax regulations. A summary of the deferred income tax accounts at December 31 is as follows:

2009 2008 Current deferred assets: Inventories $ 29.9 $ 28.0 Accounts receivable 13.2 7.2 Product warranty reserves 25.1 32.3 Product liability reserves 9.6 9.2 Deferred revenue, current portion 6.3 1.9 Deferred employee benefits 26.1 18.5 Other reserves and allowances 38.0 41.0 Less valuation allowance (6.2) — Net future income tax benefits, current $142.0 $138.1

Non-current deferred assets (liabilities): Property, plant and equipment $ (36.7) $ (47.8) Intangible assets (326.4) (305.8) Deferred employee benefits 35.9 32.9 Product warranty reserves 4.2 1.2 Tax credits 21.9 2.9 Loss carryforwards 137.7 64.1 Deferred revenue 3.7 6.3 Other 10.7 2.5 Total non-current deferred asset (liability) (149.0) (243.7) Less valuation allowance (65.8) (40.0) Net future tax benefits, non-current $(214.8) $(283.7)

The company has not provided for additional U.S. income which are available to reduce future state tax liabilities. taxes on approximately $702.6 million of undistributed earn- These state net operating loss carryforwards expire beginning ings of consolidated non-U.S. subsidiaries included in stock- in 2010 through 2029. The company also has approximately holders’ equity. Such earnings could become taxable upon $363.4 million of foreign loss carryforwards, which are avail- the sale or liquidation of these non-U.S. subsidiaries or upon able to reduce future foreign tax liabilities. These foreign dividend repatriation. The company’s intent is for such earn- loss carryforwards generally have no expiration under current ings to be reinvested by the subsidiaries or to be repatriated foreign law with the exceptions of China, Slovakia, and only when it would be tax effective through the utilization of Spain, where attributes expire at various times. The valuation foreign tax credits. It is not practicable to estimate the allowance represents a reserve for certain loss carryforwards amount of unrecognized withholding taxes and deferred tax and other net deferred tax assets for which realization is not liability on such earnings. “more likely than not.” As of December 31, 2009, the company has approximately The company has recognized a deferred tax asset of $441.8 million of state net operating loss carryforwards, $17.2 million for net operating loss carryforwards generated in

The Manitowoc Company, Inc. — 2009 Form 10-K 65

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 19 CHKSUM Content: 26832 Layout: 38410 Graphics: No Graphics CLEAN

the state of Wisconsin. These carryforwards expire at vari- tax years for which the company could be subject to income ous times through 2023. During the quarter ended tax examination by the tax authorities in its major jurisdictions: September 30, 2009, the company updated the net operating loss carryforward to reflect the 2008 return that was filed Jurisdiction Open Years during the quarter and refined its multi year Wisconsin tax- U.S. Federal 2006 — 2009 able income projections and apportionment calculations Wisconsin 2006 — 2009 under the recently enacted Wisconsin income tax law Pennsylvania 2005 — 2009 changes. As a result of this analysis, the company recorded China 2004 — 2009 a valuation allowance of $3.5 million related to this deferred France 2006 — 2009 tax asset which represents an estimate of the amount that is Germany 2001 — 2009 unlikely to be realized. The company will monitor on a quarterly basis the utilization of the net operating loss. In October 2008, the Internal Revenue Service (IRS) began The company generated $97.2 million of net operating examinations of the company’s federal consolidated income loss carryforwards in France during 2009, creating a tax returns for tax years 2006 and 2007 and the Enodis federal deferred tax asset of $33.2 million. Based upon the cycli- consolidated income tax returns for tax years 2006 through cality of the company’s Crane business, management ana- 2008. The company settled the 2006 and 2007 IRS audit in lyzes the ability to utilize these deferred tax assets on a the fourth quarter of 2009 without material financial state- seven year cycle, consistent with the demonstrated Crane ment adjustments. In March 2009, the company settled with business cycles, as this provides the best information to the Wisconsin Department of Revenue on its income tax evaluate the future profitability of the business unit. At returns for the 1997 through 2005 tax years. As a result, the December 31, 2009, the company has concluded that a val- company reduced its reserve for uncertain tax positions uation allowance against the deferred income tax asset for (including tax, interest, and penalties) by $10.5 million related the carryforward is not required to be recognized, princi- to this audit period during the quarter ended March 31, 2009. pally because (i) such carryforwards have an indefinite car- In August 2007, the German tax authorities began an exami- ryforward period, (ii) in the most recent seven-year period nation of the company’s German entity’s income and trade tax the company has utilized carryforwards incurred during the returns for 2001 through 2005. The French tax authorities began previous crane down cycle, (iii) the company currently an examination of the company’s French fiscal unity group in expects to utilize any carryforwards created during 2009 January 2009, which covers the 2006 and 2007 tax years. over the long term, (iv) in the most recent seven-year The company reduced its reserve for uncertain tax positions period, the company has recognized cumulative profitabil- by $15.4 million during the quarter ended March 31, 2009 as ity, and (v) the company has initiated tax planning actions a result of a recent German tax court ruling involving another that will increase future profitability in France. However, company with similar circumstances as the company that prior to the complete utilization of these carryforwards, supported a position taken by the company in a prior tax filing. particularly if the current economic downturn continues In June 2006, the FASB issued guidance prescribing a and the company generates operating losses in its French comprehensive model for how a company should recognize, operations for an extended period of time, it is possible the measure, present, and disclose in its financial statements company might conclude that the benefit of the carryfor- uncertain tax positions that a company has taken or expects wards would no longer meet the more-likely-than-not to take on a tax return. The company adopted this guidance, recognition criteria, at which point the company would be which is included in ASC Topic 740, “Income Taxes,” as of required to recognize a valuation allowance against some January 1, 2007. During 2009, the company recorded a or all of the tax benefit associated with the carryforwards. decrease in its unrecognized tax benefits of $34.2 million. The company updates its financial forecast of its opera- Included in the recorded unrecognized tax benefit is a tions quarterly and continues to closely monitor the utiliza- decrease of $10.3 million for accrued interest and penalties. tion of these losses. The recognition of this valuation During 2008, the company recorded additional unrecognized allowance, if necessary, could have a material adverse tax benefits of $59.7 million of which $57.0 million resulted effect on our consolidated balance sheet and results of from the Enodis acquisition and was recorded in the opening operations. balance sheet through purchase accounting. A reconciliation The company or one of its subsidiaries files income tax of the beginning and ending amount of unrecognized tax returns in the U.S. federal jurisdiction, and various state and benefits for the years ended December 31, 2009, 2008 and foreign jurisdictions. The following table provides the open 2007 is as follows:

2009 2008 2007 Balance at beginning of year $ 66.2 $30.5 $27.5 Additions based on tax positions related to the current year 9.4 2.0 18.7 Additions for tax positions of prior years 3.1 — — Additions for tax positions of prior years resulting from the Enodis acquisition — 34.5 — Reductions for tax positions of prior years (15.8) — (4.9) Reductions based on settlements with taxing authorities (7.0) — (9.5) Reductions for lapse of statute (13.6) (0.8) (1.3) Balance at end of year $ 42.3 $66.2 $30.5

66 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 20 CHKSUM Content: 3091 Layout: 22286 Graphics: No Graphics CLEAN

Substantially all of the company’s unrecognized tax bene- uncertain tax liabilities. For the year ended December 31, 2008, fits as of December 31, 2009, 2008 and 2007, if recognized, $22.5 million of the total amount resulted from the Enodis would affect the effective tax rate. acquisition and was recorded in the opening balance sheet The company recognizes accrued interest and penalties through purchase accounting. As of December 31, 2009, 2008 related to unrecognized tax benefits as part of income tax and 2007, the company has accrued interest and penalties expense. During the years ended December 31, 2009, 2008, of $19.9 million, $30.1 million, and $6.2 million, respectively. and 2007, the company recognized in the Consolidated During the next 12 months, the company does not expect Statements of Operations $(10.3) million, $24.0 million, and any material changes in its unrecognized tax benefits. $(1.9) million, respectively, for interest and penalties related to 14. Earnings Per Share

The following is a reconciliation of the weighted average shares outstanding used to compute basic and diluted earnings per share. 2009 2008 2007 Basic weighted average common shares outstanding 130,268,670 129,930,749 124,667,931 Effect of dilutive securities — stock options and restricted stock — 1,699,466 2,821,485 Diluted weighted average common shares outstanding 130,268,670 131,630,215 127,489,416

For the year ended December 31, 2009, the total number March 29, 2017, unless earlier redeemed or exchanged by of potential dilutive options was 0.5 million. However, these the company as described in the Rights Agreement. options were not included in the computation of diluted net On July 26, 2007, the Board of Directors authorized a loss per common share for the year since to do so would two-for-one split of the company’s common stock. Record decrease the loss per share. For the years ended holders of the company’s common stock at the close of busi- December 31, 2009, 2008 and 2007, 3.4 million, 1.0 million, ness on August 31, 2007 received on September 10, 2007 and 0.0 million, respectively, common shares issuable upon one additional share of common stock for every share of the exercise of stock options, were anti-dilutive and were Manitowoc common stock they owned as of August 31, excluded from the calculation of diluted earnings per share. 2007. The company’s shares of common stock outstanding at the close of business on August 31, 2007 totaled 62,787,642. 15. Equity The company’s common stock began trading at its post-split price at the beginning of trading on September 11, 2007. Per Authorized capitalization consists of 300 million shares of share, share and stock option amounts within this Annual $0.01 par value common stock and 3.5 million shares of Report on Form 10-K for all periods presented have been $0.01 par value preferred stock. None of the preferred shares adjusted to reflect the stock split. have been issued. The amount and timing of the quarterly dividend is deter- On March 21, 2007, the Board of Directors of the company mined by the Board of Directors at its regular meetings each approved the Rights Agreement between the company and year. On October 26, 2009, the Board of Directors unanimously Computershare Trust Company, N.A., as Rights Agent and adopted a resolution switching the company’s quarterly declared a dividend distribution of one right (a Right) for common stock cash dividend to an annual common stock each outstanding share of Common Stock, par value $0.01 cash dividend determination. Beginning in October 2010, per share, of the company, to shareholders of record at the and in its regular fall meetings each year thereafter, the close of business on March 30, 2007. In addition to the Board of Directors will determine the amount, if any, and Rights issued as a dividend on the record date, the Board of timing of the annual dividend for that year. In the years Directors has also determined that one Right will be issued ended December 31, 2009 and December 31, 2008, the together with each share of common stock issued by the company paid a quarterly dividend of $0.02 in cash for each company after March 30, 2007. Generally, each Right, when quarter for a cumulative dividend in 2009 and 2008 of $0.08 it becomes exercisable, entitles the registered holder to pur- per share, respectively. In the year ended December 31, chase from the company one share of Common Stock at a 2007, the company paid a quarterly dividend of $.0175 purchase price, in cash, of $110.00 per share ($220.00 per (adjusted for the stock split in September of 2007) in cash share prior to the September 10, 2007 stock split), subject to the first two quarters and paid a quarterly dividend of $0.02 adjustment as set forth in the Rights Agreement. in cash in each of the last two quarters for a cumulative divi- As explained in the Rights Agreement, the Rights become dend in 2007 of $0.075 per share. exercisable on the “Distribution Date”, which is that date that Currently, the company has authorization to purchase up any of the following occurs: (1) 10 days following a public to 10 million shares (adjusted for the 2006 and 2007 2-for-1 announcement that a person or group of affiliated persons stock splits) of common stock at management’s discretion. has acquired, or obtained the right to acquire, beneficial As of December 31, 2009, the company had purchased ownership of 20% or more of the outstanding shares of approximately 7.6 million shares (adjusted for the 2006 and Common Stock of the company; or (2) 10 business days 2007 2-for-1 stock splits) at a cost of $49.8 million pursuant following the commencement of a tender offer or exchange to this authorization. The company did not purchase any offer that would result in a person or group beneficially shares of its common stock during 2009, 2008 or 2007. owning 20% or more of such outstanding shares of Common In November 2007, the company sold, pursuant to an Stock. The Rights will expire at the close of business on underwritten public offering, approximately 4.0 million

The Manitowoc Company, Inc. — 2009 Form 10-K 67

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 21 CHKSUM Content: 18680 Layout: 37392 Graphics: No Graphics CLEAN

shares of its common stock at a price of $39.48 per share to The company maintains the following stock plans: the public. The offering was undertaken to meet anticipated The Manitowoc Company, Inc. 1995 Stock Plan provides investor demand for the company’s common stock in con- for the granting of stock options, restricted stock and limited nection with Standard & Poor’s decision to add the company stock appreciation rights as an incentive to certain employees. to the S&P 500 Index as of the close of trading on Under this plan, stock options to acquire up to 10.1 million November 15. Net cash proceeds from this offering, after shares of common stock, in the aggregate, may be granted deducting underwriting discounts and commissions, were under the time-vesting formula at an exercise price equal to $156.9 million. We used the proceeds for general corporate the market price of the common stock at the close of busi- purposes. ness or the business day immediately preceding the date of The components of accumulated other comprehensive grant. The options become exercisable in 25% increments income as of December 31, 2009 and 2008 are as follows: beginning on the second anniversary of the grant date over a four-year period and expire ten years subsequent to the 2009 2008 grant date. The restrictions on any restricted shares granted Foreign currency translation $ 86.6 $ 87.1 under the plan lapse in one-third increments on each anniversary of the grant date. Awards are no longer granted Derivative instrument fair market value, under this plan. Awards surrendered under this plan become net of income taxes of $(1.3) and $(3.2) (2.5) (5.9) available for granting under the 2003 Incentive Stock and Employee pension and postretirement benefit Awards Plan. adjustments, net of income taxes of The Manitowoc Company, Inc. 2003 Incentive Stock and $(12.0) and $(6.8) (22.3) (12.7) Awards Plan (2003 Stock Plan) provides for both short-term $ 61.8 $ 68.5 and long-term incentive awards for employees. Stock-based awards may take the form of stock options, stock apprecia- 16. Stock Based Compensation tion rights, restricted stock, and performance share or performance unit awards. The total number of shares of the Stock-based compensation expense is calculated by esti- company’s common stock originally available for awards mating the fair value of incentive and non-qualified stock under the 2003 Stock Plan was 12.0 million shares (adjusted options at the time of grant and is amortized over the stock for all stock splits since the plan’s inception) and is subject options’ vesting period. The company granted options to to further adjustments for stock splits, stock dividends and acquire 2.1 million and 0.5 million shares of stock to officers, certain other transactions or events in the future. Options directors, including non-employee directors and employees under this plan are exercisable at such times and subject to during the first quarter of 2009 and 2008, respectively. The such conditions as the compensation committee should stock option grants to directors are exercisable immediately determine. Options granted under the plan to date become upon granting and expire ten years subsequent to the grant exercisable in 25% increments beginning on the second date. All other stock option grants become exercisable in anniversary of the grant date over a four-year period and 25% increments beginning on the second anniversary of the expire ten years subsequent to the grant date. Restrictions grant date over a four-year period and expire ten years sub- on restricted stock awarded under this plan lapse 100% on sequent to the grant date. In addition, the company issued the third anniversary of the grant date. There have been no 0.2 million shares of restricted stock during each of the first awards of stock appreciation rights, performance shares or quarters of 2009 and 2008. The restrictions on all shares of performance units. restricted stock expire on the third anniversary of the grant date. The Manitowoc Company, Inc. 1999 Non-Employee Director Effective January 1, 2006, the company adopted ASC Stock Option Plan (1999 Stock Plan) provides for the granting Topic 718-10, “Compensation-Stock Compensation,” which of stock options to non-employee members of the Board of requires all share-based payments to employees, including Directors. Under this plan, stock options to acquire up to grants of employee stock options, to be measured at fair 0.7 million shares (adjusted for all stock splits since the value and expensed in the Consolidated Statements of plan’s inception and is subject to further adjustments for Operations over the service period (generally the vesting stock splits, stock dividends and certain other transactions period) of the grant. Upon adoption, the company transitioned or events in the future) of common stock, in the aggregate, to using the modified prospective application, under which may be granted under a time-vesting formula and at an exer- compensation expense is only recognized in the Consoli- cise price equal to the market price of the common stock at dated Statements of Operations beginning with the first the date of grant. For the 1999 Stock Plan, the options are period that ASC Topic 718-10 was effective and continuing exercisable in 25% increments beginning on the first to be expensed thereafter. The company recognizes expense anniversary of the grant date over a four-year period and for all stock-based compensation with graded vesting on a expire ten years subsequent to the grant date. During 2004, straight-line basis over the vesting period of the entire award. this plan was frozen and replaced with the 2004 Director As a result of the adoption of ASC Topic 718-10, the Stock Plan. company recognized $5.3 million ($4.9 million after taxes), The 2004 Non-Employee Director Stock and Awards Plan $6.5 million ($6.4 million after taxes) and $6.2 million (2004 Director Stock Plan) was approved by the shareholders ($4.5 million after taxes) of compensation expense associ- of the company during the 2004 annual meeting and it ated with stock options for the years ended December 31, replaces 1999 Stock Plan. Stock-based awards may take the 2009, 2008 and 2007, respectively. form of stock options, restricted stock, or restricted stock

68 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 22 CHKSUM Content: 29119 Layout: 49025 Graphics: No Graphics CLEAN

units. The total number of shares of the company’s common Grove stock options under the Grove Investors, Inc. 2001 stock originally available for awards under the 2004 Stock Stock Incentive Plan were converted into options to acquire Plan was 0.9 million (adjusted for all stock splits since the the company’s common stock at the date of acquisition. plan’s inception and is subject to further adjustments for Under this plan, after the conversion of Grove stock options stock splits, stock dividends and certain other transactions to Manitowoc stock options, stock options to acquire or events in the future). Stock options awarded under the 0.1 million shares (adjusted for all stock splits since the plan vest immediately and expire ten years subsequent to plan’s inception and is subject to further adjustments for the grant date. Restrictions on restricted stock awarded to stock splits, stock dividends and certain other transactions date under the plan lapse on the third anniversary of the or events in the future) of common stock of the company award date. were outstanding. These options are fully vested and expire on With the acquisition of Grove, the company inherited the September 25, 2011. No additional options may be granted Grove Investors, Inc. 2001 Stock Incentive Plan. Outstanding under the Grove Investors, Inc. 2001 Stock Incentive Plan.

A summary of the company’s stock option activity is as follows (in millions, except weighted average exercise price):

Weighted Average Aggregate Shares Exercise Price Intrinsic Value Options outstanding as of January 1, 2008 4.5 $15.43 Granted 0.5 39.27 Exercised (0.5) 8.97 Cancelled (0.2) 24.47 Options outstanding as of December 31, 2008 4.3 $18.21 Granted 2.1 4.41 Exercised (0.2) 6.75 Cancelled (0.2) 17.69 Options outstanding as of December 31, 2009 6.0 $13.67 $15.0 Options exercisable as of: January 1, 2008 1.6 $ 8.85 December 31, 2008 1.9 $11.05 December 31, 2009 2.7 $14.36 $ 3.5

The outstanding stock options at December 31, 2009 have a by range of exercise prices at December 31, 2009 (in millions, range of exercise prices of $4.23 to $47.84 per option. The except weight average remaining contractual life and weighted following table shows the options outstanding and exercisable average exercise price):

Weighted Average Remaining Outstanding Contractual Weighted Average Exercisable Weighted Average Range of Exercise Price Options Life (Years) Exercise Price Options Exercise Price $4.23–$6.00 2.2 8.7 $ 4.44 0.2 $ 4.77 $6.01–$7.00 0.4 2.6 6.31 0.4 6.31 $7.01–$9.00 0.5 3.4 7.90 0.5 7.91 $9.01–$10.20 0.6 5.3 10.13 0.5 10.14 $10.21–$18.00 0.3 5.3 10.47 0.2 10.44 $18.01–$25.00 0.4 6.2 18.89 0.2 18.93 $25.01–$27.50 0.5 6.3 26.11 0.4 26.10 $27.51–$29.52 0.6 7.2 29.51 0.3 29.51 $35.97–$47.84 0.5 8.0 38.98 — 38.99 6.0 6.8 $13.67 2.7 $14.36

The company continues to use the Black-Scholes valuation expected to be outstanding and are based on historical model to value stock options. The company used its histori- experience. cal stock prices as the basis for its volatility assumption. The As of December 31, 2009, the company has $11.9 million assumed risk-free rates were based on ten-year U.S. Treasury of unrecognized compensation expense which will be recog- rates in effect at the time of grant. The expected option life nized over the next five years. represents the period of time that the options granted are

The Manitowoc Company, Inc. — 2009 Form 10-K 69

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 23 CHKSUM Content: 17281 Layout: 37392 Graphics: No Graphics CLEAN

The weighted average fair value of options granted per Based on the facts presently known, the company does not share during the years ended December 31, 2009, 2008 and expect environmental compliance costs to have a material 2007 was $1.89, $15.34 and $12.56, respectively. The fair adverse effect on its financial condition, results of operations, value of each option grant was estimated at the date of or cash flows. grant using the Black-Scholes option-pricing method with As of December 31, 2009, various product-related lawsuits the following assumptions: were pending. To the extent permitted under applicable law, all of these are insured with self-insurance retention levels. 2009 2008 2007 The company’s self-insurance retention levels vary by busi- Expected life (years) 6.0 6.0 6.0 ness, and have fluctuated over the last five years. The range of the company’s self-insured retention levels is $0.1 million Risk-free interest rate 2.2% 4.4% 4.4% to $3.0 million per occurrence. The high-end of the company’s Expected volatility 43.0% 35.0% 35.0% self-insurance retention level is a legacy product liability Expected dividend yield 0.3% 0.3% 0.3% insurance program inherited in the Grove acquisition for cranes manufactured in the United States for occurrences For the years ended December 31, 2009, 2008 and 2007 from January 2000 through October 2002. As of December 31, the total intrinsic value of stock options exercised was 2009, the largest self-insured retention level for new occur- $0.5 million, $13.8 million and $45.9 million, respectively. rences currently maintained by the company is $2.0 million per occurrence and applies to product liability claims for 17. Contingencies and Significant Estimates cranes manufactured in the United States. Product liability reserves in the Consolidated Balance The company has been identified as a potentially responsible Sheet at December 31, 2009 were $28.0 million; $9.6 million party under the Comprehensive Environmental Response, was reserved specifically for actual cases and $18.4 million Compensation, and Liability Act (CERLA) in connection with for claims incurred but not reported which were estimated the Lemberger Landfill Superfund Site near Manitowoc, using actuarial methods. Based on the company’s experi- Wisconsin. Approximately 150 potentially responsible parties ence in defending product liability claims, management have been identified as having shipped hazardous materials believes the current reserves are adequate for estimated to this site. Eleven of those, including the company, have case resolutions on aggregate self-insured claims and formed the Lemberger Site Remediation Group and have insured claims. Any recoveries from insurance carriers are successfully negotiated with the United States Environmental dependent upon the legal sufficiency of claims and solvency Protection Agency and the Wisconsin Department of Natural of insurance carriers. Resources to fund the cleanup and settle their potential liability At December 31, 2009 and December 31, 2008, the com- at this site. The estimated remaining cost to complete the pany had reserved $113.6 million and $123.5 million, respec- clean up of this site is approximately $8.1 million. Although tively, for warranty claims included in product warranties and liability is joint and several, the company’s share of the liability other non-current liabilities in the Consolidated Balance is estimated to be 11% of the remaining cost. Remediation Sheets. Certain of these warranty and other related claims work at the site has been substantially completed, with only involve matters in dispute that ultimately are resolved by long-term pumping and treating of groundwater and site negotiations, arbitration, or litigation. maintenance remaining. The company’s remaining estimated It is reasonably possible that the estimates for environmental liability for this matter, included in accounts payable and remediation, product liability and warranty costs may accrued expenses in the Consolidated Balance Sheets at change in the near future based upon new information that December 31, 2009 and 2008 is $0.7 and $0.8 million, may arise or matters that are beyond the scope of the com- respectively. Based on the size of the company’s current pany’s historical experience. Presently, there are no reliable allocation of liabilities at this site, the existence of other methods to estimate the amount of any such potential viable potential responsible parties and current reserve, the changes. company does not believe that any liability imposed in con- The company is involved in numerous lawsuits involving nection with this site will have a material adverse effect on asbestos-related claims in which the company is one of its financial condition, results of operations, or cash flows. numerous defendants. After taking into consideration legal As of December 31, 2009, the company also held reserves counsel’s evaluation of such actions, the current political for environmental matters related to Enodis locations of environment with respect to asbestos related claims, and approximately $1.6 million. At certain of the company’s other the liabilities accrued with respect to such matters, in the facilities, the company has identified potential contaminants opinion of management, ultimate resolution is not expected in soil and groundwater. The ultimate cost of any remediation to have a material adverse effect on the financial condition, required will depend upon the results of future investigation. results of operations, or cash flows of the company. Based upon available information, the company does not In conjunction with the Enodis acquisition, the company expect the ultimate costs at any of these locations will have assumed the responsibility to address outstanding and a material adverse effect on its financial condition, results of future legal actions. At the time of acquisition, the only sig- operations, or cash flows. nificant unresolved claimed legal matter involved a former The company believes that it has obtained and is in sub- subsidiary of Enodis, Consolidated Industries Corporation stantial compliance with those material environmental permits (Consolidated). Enodis sold Consolidated to an unrelated and approvals necessary to conduct its various businesses. party in 1998. Shortly after the sale, Consolidated commenced

70 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 24 CHKSUM Content: 36153 Layout: 57918 Graphics: No Graphics CLEAN

bankruptcy proceedings. In February of 2009, a settlement In the normal course of business, the company provides agreement was reached in the Consolidated matter and the its customers a warranty covering workmanship, and in company agreed to a settlement amount of $69.5 million some cases materials, on products manufactured by the plus interest from February 1, 2009 when the settlement company. Such warranty generally provides that products agreement was approved by the Bankruptcy Court. A reserve will be free from defects for periods ranging from 12 months for this matter was accrued for in purchase accounting upon to 60 months with certain equipment having longer-term the acquisition of Enodis. In March of 2009, the company warranties. If a product fails to comply with the company’s made an initial payment $56.0 million. In addition, both par- warranty, the company may be obligated, at its expense, to ties mutually agreed to the remaining balance, along with correct any defect by repairing or replacing such defective interest, of approximately $14.0 million which was paid in products. The company provides for an estimate of costs April 2009. that may be incurred under its warranty at the time product The company is also involved in various legal actions aris- revenue is recognized. These costs primarily include labor ing out of the normal course of business, which, taking into and materials, as necessary, associated with repair or account the liabilities accrued and legal counsel’s evaluation replacement. The primary factors that affect the company’s of such actions, in the opinion of management, the ultimate warranty liability include the number of units shipped and resolution is not expected to have a material adverse effect historical and anticipated warranty claims. As these factors on the company’s financial condition, results of operations, are impacted by actual experience and future expectations, or cash flows. the company assesses the adequacy of its recorded warranty liability and adjusts the amounts as necessary. Below 18. Guarantees is a table summarizing the warranty activity for the years ended December 31, 2009 and 2008. The company periodically enters into transactions with customers that provide for residual value guarantees and buy- 2009 2008 back commitments. These initial transactions are recorded Balance at beginning of period $123.5 $ 91.2 as deferred revenue and are amortized to income on a Accruals for warranties issued during the period 74.4 61.0 straight-line basis over a period equal to that of the customer’s third party financing agreement. The deferred revenue Acquisitions — 33.4 included in other current and non-current liabilities at Settlements made (in cash or in kind) December 31, 2009 and December 31, 2008, was $72.2 million during the period (85.5) (61.1) and $105.8 million, respectively. The total amount of residual Currency translation 1.2 (1.0) value guarantees and buyback commitments given by the Balance at end of period $113.6 $123.5 company and outstanding at December 31, 2009 and December 31, 2008, was $80.6 million and $105.1 million, 19. Restructuring respectively. These amounts are not reduced for amounts the company would recover from repossessing and subse- In the fourth quarter of 2008, the company committed to a quent resale of the units. The residual value guarantees and restructuring plan to reduce the cost structure of its French buyback commitments expire at various times through 2013. and Portuguese crane facilities and recorded a restructuring During the years ended December 31, 2009 and 2008, the expense of $21.7 million to establish a reserve for future company sold $6.1 million and $3.7 million, respectively, of involuntary employee terminations and related costs. The its long term notes receivable to third party financing com- restructuring plan was primarily to better align the company’s panies. The company guarantees some percentage, up to resources due to the accelerated decline in demand in 100%, of collection of the notes to the financing companies. Western and Southern Europe where market conditions The company has accounted for the sales of the notes as a have negatively impacted the company’s tower crane prod- financing of receivables. The receivables remain on the com- uct sales. As a result of the continued worldwide decline in pany’s Consolidated Balance Sheets, net of payments crane sales during the year ended December 31, 2009, the made, in other current and non-current assets and the com- company recorded an additional $29.0 million in restructur- pany has recognized an obligation equal to the net outstanding charges to further reduce the Crane segment cost struc- ing balance of the notes in other current and non-current ture in all regions. The restructuring plans will reduce the liabilities in the Consolidated Balance Sheets. The cash flow Crane segment workforce by approximately 40% of 2008 benefit of these transactions are reflected as financing activ- year-end levels. As of December 31, 2009, $20.2 million of ities in the Consolidated Statements of Cash Flows. During benefit payments had been made with respect to the work- the years ended December 31, 2009 and 2008 customers force reductions. have paid $11.5 million and $7.5 million, respectively, of the The following is a rollforward of all restructuring activities notes to the third party financing companies. As of Decem- relating to the Crane segment for the year ended ber 31, 2009 and 2008, the outstanding balance of the notes December 31, 2009: receivables guaranteed by the company was $9.0 million and $14.5 million, respectively.

Restructuring Reserve Restructuring Restructuring Reserve (in millions) Balance as of 12/31/08 Charges Use of Reserve Balance as of 12/31/09 Involuntary employee terminations and related costs $21.1 $29.0 $(20.2) $29.9

The Manitowoc Company, Inc. — 2009 Form 10-K 71

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 25 CHKSUM Content: 33879 Layout: 28871 Graphics: No Graphics CLEAN

The Foodservice segment also recorded restructuring The following is a rollforward of all restructuring activities expenses of $10.6 million during the year ended December 31, relating to the Foodservice segment for the year ended 2009 as a result of closing its Harford-Duracool facility in December 31, 2009: Aberdeen, Maryland in the second quarter and its McCall facility in Parsons, Tennessee in the third quarter.

In addition, $23.4 million of the Enodis acquisition related Manitowoc Retirement Savings Plan. The Manitowoc reserves were utilized during the year ended December 31, Retirement Savings Plan is a tax-qualified retirement plan 2009. As of December 31, 2009 the balance of these that is available to certain collectively bargained U.S. employ- reserves was $47.6 million. See further detail related to the ees of Manitowoc, its subsidiaries and related entities. The restructuring activities at Note 3, “Acquisitions.” company merged the following plans with and into the Manitowoc Retirement Savings Plan on December 31, 2009: 20. Employee Benefit Plans (1) The Manitowoc Cranes, Inc. Hourly-Paid Employees’ Deferred Profit-Sharing Plan; (2) the Manitowoc Ice, Inc. The company maintains three defined contribution retirement Hourly-Paid Employees’ Deferred Profit-Sharing Plan; and plans for its employees: (1) The Manitowoc Company, Inc. (3) the accounts of collectively bargained participants in the 401(k) Retirement Plan (the “Manitowoc 401(k) Retirement Enodis Corporation 401(k) Plan. Plan”); (2) The Manitowoc Company, Inc. Retirement Savings The Manitowoc Retirement Savings Plan allows employ- Plan (the “Manitowoc Retirement Savings Plan”); and The ees to make both pre- and post-tax elective deferrals, sub- Manitowoc Company, Inc. Deferred Compensation Plan (the ject to certain limitations under the Tax Code. The company “Manitowoc Deferred Compensation Plan”). Each plan also has the right to make the following additional contribu- results in individual participant balances that reflect a combi- tions: (1) a matching contribution based upon individual nation of amounts contributed by the company or deferred employee deferrals; and (2) an additional discretionary or by the participant, amounts invested at the direction of fixed company contribution. Each participant in the either the company or the participant, and the continuing Manitowoc Retirement Savings Plan is allowed to direct the reinvestment of returns until the accounts are distributed. investment of that participant’s account among a diverse mix of investment funds, including a company stock alterna- Manitowoc 401(k) Retirement Plan. The Manitowoc tive. To the extent that any funds are invested in company 401(k) Retirement Plan is a tax-qualified retirement plan that stock, that portion of the Manitowoc Retirement Savings is available to substantially all non-union U.S. employees of Plan is an ESOP. Manitowoc, its subsidiaries and related entities. The company The company’s executives are not eligible to participate in merged the accounts of non-union participants in the Enodis the Manitowoc Retirement Savings Plan. Company contribu- Corporation 401(k) Plan with and into the Manitowoc tions to the plans are based upon formulas contained in the 401(k) Retirement Plan on December 31, 2009. plans. Total costs incurred under these plans were $13.3 mil- The Manitowoc 401(k) Retirement Plan allows employees lion, $28.4 million and $36.1 million for the years ended to make both pre- and post-tax elective deferrals, subject to December 31, 2009, 2008 and 2007, respectively. certain limitations under the Internal Revenue Code of 1986, as amended (the “Tax Code”). The company also has the Manitowoc Deferred Compensation Plan. The Manitowoc right to make the following additional contributions: (1) a Deferred Compensation Plan is a non-tax-qualified supple- matching contribution based upon individual employee mental deferred compensation plan for highly compensated deferrals; (2) an economic value added (“EVA”) based company and key management employees and for directors. On contribution; and (3) an additional non-EVA-based company December 31, 2009, the company merged the Enodis contribution. Each participant in the Manitowoc 401(k) Retire- Corporation Supplemental Executive Retirement Plan, ment Plan is allowed to direct the investment of that partici- another defined contribution deferred compensation plan, pant’s account among a diverse mix of investment funds, with and into the Manitowoc Deferred Compensation Plan. including a company stock alternative. To the extent that any The company maintains the Manitowoc Deferred Compen- funds are invested in company stock, that portion of the sation Plan to allow eligible individuals to save for retirement Manitowoc 401(k) Retirement Plan is an employee stock in a tax-efficient manner despite Tax Code restrictions that ownership plan, as defined under the Tax Code (an “ESOP”). would otherwise impair their ability to do so under the The terms governing the retirement benefits under the Manitowoc 401(k) Retirement Plan. The Manitowoc Deferred Manitowoc 401(k) Retirement Plan are the same for the Compensation Plan also assists the company in retaining company’s executive officers as they are for other eligible those key employees and directors. employees in the U.S.

72 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 26 CHKSUM Content: 44378 Layout: 26311 Graphics: No Graphics CLEAN

The Manitowoc Deferred Compensation Plan accounts are accounting for treasury stock. The deferred compensation credited with: (1) elective deferrals made at the request of obligation is classified as an equity instrument. Changes in the individual participant; and/or (2) a discretionary company the fair value of the company’s stock and the compensation contribution for each individual participant. Although obligation are not recognized. The asset and obligation for unfunded within the meaning of the Tax Code, the Manitowoc Program A were both $2.2 million at December 31, 2009 and Deferred Compensation Plan utilizes a rabbi trust to hold $2.3 million at December 31, 2008. These amounts are offset assets intended to satisfy the company’s corresponding in the Consolidated Statements of Stockholders’ Equity and future benefit obligations. Each participant in the Manitowoc Comprehensive Income. Deferred Compensation Plan is credited with interest based Program B is accounted for as a plan which permits diver- upon individual elections from amongst a diverse mix of sification. As a result, the assets held by Program B are clas- investment funds that are intended to reflect investment sified as an asset in the Consolidated Balance Sheets and funds similar to those offered under the Manitowoc changes in the fair value of the assets are recognized in 401(k) Retirement Plan, including company stock. Participants earnings. The deferred compensation obligation is classified do not receive preferential or above-market rates of return as a liability in the Consolidated Balance Sheets and under the Manitowoc Deferred Compensation Plan. adjusted, with a charge or credit to compensation cost, to Effective January 1, 2002, the company amended its reflect changes in the fair value of the obligation. The assets, deferred compensation plan to provide plan participants the included in other non-current assets, and obligation, included ability to direct deferrals and company matching contribu- in other non-current liabilities, were both $12.6 million at tions into two separate investment programs, Program A December 31, 2009 and $9.6 million at December 31, 2008. and Program B. The net impact on the Consolidated Statements of Operations The investment assets in Program A and B are held in two was $0 for the years ended December 31, 2009, 2008 and 2007. separate Deferred Compensation Plans, which restrict the company’s use and access to the funds but which are also Pension, Postretirement Health and Other Benefit Plans The subject to the claims of the company’s general creditors in company provides certain pension, health care and death rabbi trusts. Program A invests solely in the company’s benefits for eligible retirees and their dependents. The pen- stock; dividends paid on the company’s stock are automati- sion benefits are funded, while the health care and death cally reinvested; and all distributions must be made in com- benefits are not funded but are paid as incurred. Eligibility pany stock. Program B offers a variety of investment options for coverage is based on meeting certain years of service but does not include company stock as an investment and retirement qualifications. These benefits may be subject option. All distributions from Program B must be made in to deductibles, co-payment provisions, and other limitations. cash. Participants cannot transfer assets between programs. The company has reserved the right to modify these benefits. Program A is accounted for as a plan which does not per- The components of period benefit costs for the years mit diversification. As a result, the company stock held by ended December 31, 2009, 2008 and 2007are as follows: Program A is classified in equity in a manner similar to

US Pension Plans Non-U.S. Pension Plans Postretirement Health and Other 2009 2008 2007 2009 2008 2007 2009 2008 2007 Service cost — benefits earned during the year $ 0.6 $ 0.1 $ — $ 1.8 $ 1.9 $ 2.1 $0.8 $0.8 $0.7 Interest cost of projected benefit obligation 10.4 7.8 7.0 11.6 5.0 3.6 3.6 3.2 3.3 Expected return on assets (9.4) (7.2) (7.0) (10.4) (4.1) (3.1) — — — Amortization of actuarial net (gain) loss 0.3 — 0.7 — — — 0.1 — 0.3 Curtailment gain recognized — — — (1.0) — — — — — Settlement gain recognized — — — 0.5 0.1 0.8 — — — Special termination benefit — — — — — 5.3 — — — Net periodic benefit cost $ 1.9 $ 0.7 $ 0.7 $ 2.5 $ 2.9 $ 8.7 $4.5 $4.0 $4.3 Weighted average assumptions: Discount rate 6.20% 6.61% 5.75% 6.25% 6.14% 4.81% 6.23% 6.52% 5.75% Expected return on plan assets 5.80% 5.92% 8.25% 6.13% 5.95% 6.03% N/A N/A N/A Rate of compensation increase N/A N/A N/A 4.19% 4.18% 3.88% 4.00% 4.00% N/A

The prior service costs are amortized on a straight-line To develop the expected long-term rate of return on basis over the average remaining service period of active assets assumptions, the company considered the historical participants. Gains and losses in excess of 10% of the returns and future expectations for returns in each asset greater of the benefit obligation and the market-related value class, as well as targeted asset allocation percentages of assets are amortized over the average remaining service within the pension portfolio. period of active participants.

The Manitowoc Company, Inc. — 2009 Form 10-K 73

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 27 CHKSUM Content: 40383 Layout: 10172 Graphics: No Graphics CLEAN

The following is a reconciliation of the changes in benefit obligation, the changes in plan assets, and the funded status as of December 31, 2009 and 2008.

Non-U.S. Pension Postretirement Health US Pension Plans Plans and Other 2009 2008 2009 2008 2009 2008 Change in Benefit Obligation Benefit obligation, beginning of year $172.8 $113.9 $185.2 $ 63.7 $ 60.8 $ 50.2 Service cost 0.6 0.1 1.8 1.9 0.8 0.8 Interest cost 10.4 7.8 11.6 5.0 3.7 3.2 Participant contributions — — 0.2 0.1 2.0 1.9 Plan curtailments — — (3.1) — — — Plan settlements —————— Special termination benefits —————— Net transfer in/(out) — 42.6 (7.1) 123.3 — 4.0 Actuarial loss (gain) 4.2 13.7 21.7 13.5 2.0 6.4 Currency translation adjustment — — 15.0 (17.3) 0.2 0.1 Benefits paid (12.4) (5.3) (16.0) (5.0) (6.5) (5.8) Benefit obligation, end of year 175.6 172.8 209.3 185.2 63.0 60.8 Change in Plan Assets Fair value of plan assets, beginning of year 165.6 119.2 159.9 51.4 — — Actual return on plan assets 1.1 22.1 16.8 5.6 — — Employer contributions 1.9 0.7 7.5 4.1 4.5 3.9 Participant contributions — — 0.1 0.1 2.0 1.9 Plan settlements —————— Currency translation adjustment — — 14.7 (18.8) — — Net transfer in/(out) — 28.9 — 122.5 — — Benefits paid (12.4) (5.3) (16.0) (5.0) (6.5) (5.8) Fair value of plan assets, end of year 156.2 165.6 183.0 159.9 — — Funded status $ (19.4) $ (7.2) $ (26.3) $ (25.3) $(63.0) $(60.8) Amounts recognized in the Consolidated Balance sheet at December 31 Pension asset $ — $ 11.0 $ 1.4 $ 6.8 $ — $ — Pension obligation (19.4) (18.2) (27.7) (32.1) — — Postretirement health and other benefit obligations — — — — (63.0) (60.8) Net amount recognized $ (19.4) $ (7.2) $ (26.3) $ (25.3) $(63.0) $(60.8) Weighted-Average Assumptions Discount rate 6.00% 6.20% 5.62% 6.25% 5.99% 6.23% Expected return on plan assets 5.80% 5.92% 6.13% 5.95% N/A N/A

Amounts recognized in accumulated other comprehensive income as of December 31, 2009 and 2008, consist of the following:

Postretirement Pensions Health and Other 2009 2008 2009 2008 Net actuarial gain (loss) $(41.1) $(15.2) $(7.9) $(6.0) Prior service credit 0.2 0.3 — — Total amount recognized $(40.9) $(14.9) $(7.9) $(6.0)

The amounts in accumulated other comprehensive income significant for the pension and the postretirement health and that are expected to be recognized as components of net other plans. periodic benefit cost during the next fiscal year are not

74 The Manitowoc Company, Inc. — 2009 Form 10-K

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For measurement purposes, a 9.0% annual rate of increase effect on the amounts reported for the health care plans. in the per capita cost of covered health care benefits was The following table summarizes the sensitivity of our assumed for 2009. The rate was assumed to decrease grad- December 31, 2009 retirement obligations and 2010 retire- ually to 5.0% for 2019 and remain at that level thereafter. ment benefit costs of our plans to changes in the key Assumed health care cost trend rates have a significant assumptions used to determine those results:

Estimated Estimated increase Estimated increase increase (decrease) in Projected Estimated increase (decrease) in Other (decrease) Benefit Obligation for (decrease) in Other Postretirement Benefit in 2010 the year ended Postretirement Obligation for the year ended Change in assumption: pension cost December 31, 2009 Benefit costs December 31, 2009 0.50% increase in discount rate $(0.2) $(23.1) $(0.1) $(2.7) 0.50% decrease in discount rate 1.3 24.6 0.2 2.8 0.50% increase in long-term return on assets (1.6) — — — 0.50% decrease in long-term return on assets 1.6 — — — 1% increase in medical trend rates — — 1.1 5.8 1% decrease in medical trend rates — — (0.5) (5.1)

It is reasonably possible that the estimate for future retire- of large losses. On a quarterly basis, the Committee reviews ment and health costs may change in the near future due to progress towards achieving the pension plans’ and individual changes in the health care environment or changes in interest managers’ performance objectives. rates that may arise. Presently, there is no reliable means to estimate the amount of any such potential changes. Investment Strategy The overall objective of our pension The weighted-average asset allocations of the U.S. pension assets is to earn a rate of return over time to satisfy the ben- plans at December 31, 2009 and 2008, by asset category are efit obligations of the pension plans and to maintain suffi- as follows: cient liquidity to pay benefits and address other cash requirements of the pension fund. Specific investment 2009 2008 objectives for our long-term investment strategy include reducing the volatility of pension assets relative to pension Equity 14.0% 16.6% liabilities, achieving a competitive, total investment return, Fixed income 86.0 83.4 achieving diversification between and within asset classes Other —— and managing other risks. Investment objectives for each 100.0% 100.0% asset class are determined based on specific risks and investment opportunities identified. The weighted-average asset allocations of the Non U.S. We review our long-term, strategic asset allocations annually. pension plans at December 31, 2009 and 2008, by asset cat- We use various analytics to determine the optimal asset mix egory are as follows: and consider plan liability characteristics, liquidity characteristics, funding requirements, expected rates of return and 2009 2008 the distribution of returns. We identify investment benchmarks for the asset classes in the strategic asset allocation that are Equity 28.0% 26.9% market-based and investable where possible. Fixed income 62.0 72.5 Actual allocations to each asset class vary from target allo- Other 10.0 0.6 cations due to periodic investment strategy changes, market 100.0% 100.0% value fluctuations, the length of time it takes to fully implement investment allocation positions and the timing of benefit The Board of Directors has established the Retirement payments and contributions. The asset allocation is monitored Plan Committee (the Committee) to manage the operations and rebalanced on a monthly basis. and administration of all benefit plans and related trusts. The The actual allocations for the pension assets at December 31, Committee is committed to diversification to reduce the risk 2009 and 2008, and target allocations by asset class, are as follows:

Weighted Average Target Allocations Asset Allocations U.S. Plans International Plans U.S. Plans International Plans Equity Securities 10–60% 38–50% 14% 28% Debt Securities 40–90% 36–57% 86% 62% Other 0% 0–10% 0% 10%

The Manitowoc Company, Inc. — 2009 Form 10-K 75

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 29 CHKSUM Content: 27786 Layout: 17412 Graphics: No Graphics CLEAN

Risk Management In managing the plan assets, we review Fair Value Measurements The following table presents our and manage risk associated with funded status risk, interest plan assets using the fair value hierarchy as of Decem- rate risk, market risk, counterparty risk, liquidity risk and ber 31, 2009. The fair value hierarchy has three levels based operational risk. Liability management and asset class diver- on the reliability of the inputs used to determine fair value. sification are central to our risk management approach and Level 1 refers to fair values determined based on quoted are integral to the overall investment strategy. Further, asset prices in active markets for identical assets. Level 2 refers to classes are constructed to achieve diversification by invest- fair values estimated using significant other observable ment strategy, by investment manager, by industry or sector inputs, and Level 3 includes fair values estimated using sig- and by holding. Investment manager guidelines for publicly nificant non-observable inputs. traded assets are specified and are monitored regularly.

Quoted Prices in Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Assets (Level 1) (Level 2) (Level 3) Total Cash $1.9 $ — $ — $ 1.9 Corporate equity 0.4 — — 0.4 Insurance group annuity contracts — — 16.0 16.0 Common/collective trust funds — Government debt — 48.2 — 48.2 Common/collective trust funds — Corporate and other non-government debt — 121.0 — 121.0 Common/collective trust funds — Government, corporate and other non-government debt — 55.4 — 55.4 Common/collective trust funds — Corporate equity — 74.1 — 74.1 Common/collective trust funds — Customized strategy — 21.6 — 21.6 Other — 0.6 — 0.6 Total $2.3 $320.9 $16.0 $339.2

Cash equivalents and other short-term investments, which for the enrolled participants, while the remaining merged are used to pay benefits, are primarily held in registered plans had benefit accruals frozen prior to the merger of the money market funds which are valued using a market plans. Effective January 1, 2007, the company merged all approach based on the quoted market prices of identical Manitowoc U.S. pension plans together and made a contri- instruments. Other cash equivalent and short-term invest- bution of $27.2 million that is expected to fully fund the ments are valued daily by the fund using a market approach ongoing pension liability. At the same time the company with inputs that include quoted market prices for similar also changed its investment policy to more closely align the instruments. interest rate sensitivity of its pension assets with the corre- Corporate equity securities are primarily valued using a sponding liabilities. The resulting asset allocation is approxi- market approach based on the quoted market prices of iden- mately 10% equities and 90% fixed income. This funding tical instruments. and change in allocation removed a significant portion of the Insurance group annuity contracts are valued at the pres- U.S. pension’s volatility arising from unpredictable changes ent value of the future benefit payments owed by the insur- in interest rates and the equity markets. This decision will ance company to the Plans’ participants. protect the company’s balance sheet as well as support its Common/collective funds are typically common or collec- goal of minimizing unexpected future pension cash contribu- tive trusts valued at their net asset values (NAVs) that are tions based upon the new provisions of the Pension Protec- calculated by the investment manager or sponsor of the tion Act and protect our employees’ benefits. fund and have daily or monthly liquidity. During the second quarter of 2007, the company made a A reconciliation of the fair values measurements of plan $15.1 million pension contribution to its U.K. defined benefit assets using significant unobservable inputs (Level 3) from pension plan. The $15.1 million contribution funded the the beginning of the year to the end of the year is as follows: defined benefit plan as well as paid an incentive to certain pensioners to transfer from the defined benefit plan to a Insurance defined contribution plan. As a result of this payment, the Contracts company recorded a charge during the second quarter of Balance, December 31, 2008 $ — 2007 of approximately $3.8 million to reflect the incentive given to the pensioners and expenses incurred. During the Purchase of annuity 17.5 second quarter of 2007, the company recorded a charge of Actual return on assets (0.9) $1.4 million related to a withdraw liability from a multiem- Benefit payments (0.6) ployer pension plan at its former River Falls, Wisconsin facility. Balance, December 31, 2009 $16.0 The expected 2010 contributions for the U.S. pension plans are as follows: the minimum contribution for 2010 is In conjunction with the Enodis acquisition and effective as $1.9 million; the discretionary contribution is $0 million; and of December 31, 2008, the company merged all but one of the non-cash contribution is $0. The expected 2010 contribu- the Enodis U.S. pension plans into the Manitowoc U.S. merged tions for the non-U.S. pension plans are as follows: the mini- pension plan. The unmerged plan continues to accrue benefits mum contribution for 2010 is $4.4 million; the discretionary

76 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 30 CHKSUM Content: 57413 Layout: 35020 Graphics: No Graphics CLEAN

contribution is $0; and the non-cash contribution is $0. Expected company paid claims for the postretirement health and life insurance plans are $4.6 million for 2010. Projected benefit payments from the plans as of December 31, 2009 are estimated as follows:

Postretirement U.S Pension Non-U.S. Health and Plans Pension Plans Other 2010 $ 9.5 $12.0 $ 4.6 2011 9.7 11.7 4.7 2012 9.9 11.9 4.9 2013 10.4 13.0 5.1 2014 10.7 14.1 5.4 2015 — 2019 61.3 80.6 30.9

The fair value of plan assets for which the accumulated benefit obligation is in excess of the plan assets as of December 31, 2009 and 2008 is as follows: U.S Pension Plans Non U.S. Pension Plans 2009 2008 2009 2008 Projected benefit obligation $175.6 $30.3 $173.9 $38.4 Accumulated benefit obligation 175.6 30.3 170.6 35.6 Fair value of plan assets 156.1 12.1 146.2 6.2

The accumulated benefit obligation for all U.S. pension plans operations, the company has two remaining reportable seg- as of December 31, 2009 and 2008 was $175.6 million and ments, the Crane and Foodservice segments. $172.8 million, respectively. The accumulated benefit obliga- The company identifies its segments using the “manage- tion for all non-U.S. pension plans as of December 31, 2009 ment approach,” which designates the internal organization and 2008 was $204.5 million and $179.6 million, respectively. that is used by management for making operating decisions The measurement date for all plans is December 31, 2009. and assessing performance as the source of the company’s The company also maintains a target benefit plan for certain reportable segments. The company has not aggregated indi- executive officers of the company. Expenses related to the vidual operating segments within these reportable segments. plan in the amount of $1.3 million, $4.1 million and $3.0 million were recorded in 2009, 2008 and 2007, respectively. Amounts The Crane business is a global provider of engineered lift accrued as of December 31, 2009 and 2008 related to this solutions which designs, manufactures and markets a com- plan were $18.7 million and $16.5 million, respectively. prehensive line of lattice-boom crawler cranes, mobile telescopic cranes, tower cranes, and boom trucks. The Crane 21. Leases products are used in a wide variety of applications, including energy, petrochemical and industrial projects, infrastructure The company leases various property, plant and equip- development such as road, bridge and airport construction, ment. Terms of the leases vary, but generally require the commercial and high-rise residential construction, mining company to pay property taxes, insurance premiums, and and dredging. Our crane-related product support services maintenance costs associated with the leased property. are principally marketed under the Crane Care brand name Rental expense attributed to operating leases was $43.8 mil- and include maintenance and repair services and parts supply. lion, $33.9 million and $28.0 million in 2009, 2008 and 2007, Our Foodservice equipment business designs, manufac- respectively. Future minimum rental obligations under non- tures and sells primary cooking and warming equipment; cancelable operating leases, as of December 31, 2009, are ice-cube machines, ice flaker machines and storage bins; payable as follows: refrigerator and freezer equipment; warewashing equipment; beverage dispensers and related products; serving 2010 $ 43.6 and storage equipment; and food-preparation equipment. 2011 35.8 Our suite of products is used by commercial and institu- 2012 28.2 tional foodservice operators such as full service restaurants, 2013 25.0 QSR chains, hotels, industrial caterers, supermarkets, convenience stores, hospitals, schools and other institutions. 2014 17.6 The accounting policies of the segments are the same as Thereafter 45.9 those described in the summary of significant accounting Total $196.1 policies except that certain expenses are not allocated to the segments. These unallocated expenses are corporate over- 22. Business Segments head, amortization expense of intangible assets with definite lives, interest expense and income tax expense. The com- On December 31, 2008, the company completed the sale of pany evaluates segment performance based upon profit and its Marine segment to Fincantieri Marine Group Holdings, Inc., loss before the aforementioned expenses. Financial informa- a subsidiary of Fincantieri — Cantieri Navali Italiani SpA. The tion relating to the company’s reportable segments for the sale price in the all-cash deal was approximately $120 million. years ended December 31, 2009, 2008 and 2007 is as follows. After reclassifying the Marine segment to discontinued

The Manitowoc Company, Inc. — 2009 Form 10-K 77

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 31 CHKSUM Content: 16062 Layout: 36481 Graphics: No Graphics CLEAN

Restructuring costs separately identified in the Consolidated Statements of Operations are included as reductions to the respective segments operating earnings for each year below. 2009 2008 2007 Net sales from continuing operations: Crane $2,285.0 $3,882.9 $3,245.7 Foodservice 1,497.6 620.1 438.3 Total $3,782.6 $4,503.0 $3,684.0 Operating earnings (loss) from continuing operations: Crane $ 145.0 $ 555.6 $ 470.5 Foodservice 174.3 56.8 61.3 Corporate (44.4) (51.7) (48.2) Amortization expense (39.5) (11.6) (5.8) Gain on sale of parts line — — 3.3 Goodwill impairment (548.8) — — Intangible asset impairment (151.2) — — Restructuring expense (39.6) (21.7) — Integration expense (3.6) (7.6) — Loss on sale of product lines (3.4) — — Pension settlements — — (5.3) Operating earnings (loss) from continuing operations $ (511.2) $ 519.8 $ 475.8 Capital expenditures: Crane $ 51.5 $ 129.4 $ 103.7 Foodservice 18.4 10.9 3.7 Corporate 2.6 10.0 5.4 Total $ 72.5 $ 150.3 $ 112.8 Total depreciation: Crane $ 55.3 $ 66.3 $ 70.4 Foodservice 33.5 12.4 8.0 Corporate 2.8 1.5 1.8 Total $ 91.6 $ 80.2 $ 80.2 Total assets: Crane $1,738.4 $2,223.7 $1,958.0 Foodservice 2,279.5 3,389.4 341.5 Corporate 260.8 473.0 571.9 Total $4,278.7 $6,086.1 $2,871.4

Net sales from continuing operations and long-lived asset information by geographic area as of and for the years ended December 31 are as follows: Net Sales Long-Lived Assets 2009 2008 2007 2009 2008 United States $1,862.6 $1,896.6 $1,627.4 $ 457.7 $ 484.0 Other North America 177.3 127.7 114.1 7.4 7.4 Europe 824.8 1,444.2 1,215.0 264.6 450.2 Asia 279.1 395.0 299.5 76.4 80.0 Middle East 274.6 314.0 183.0 1.8 1.8 Central and South America 155.0 117.4 61.9 0.3 0.6 Africa 88.9 82.8 64.2 — — South Pacific and Caribbean 32.2 13.5 16.0 5.2 5.4 Australia 88.1 111.8 102.9 1.2 2.2 Total $3,782.6 $4,503.0 $3,684.0 $ 814.6 $1,031.6

Net sales from continuing operations and long-lived asset information for Europe primarily relate to France, Germany and the United Kingdom.

78 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 32 CHKSUM Content: 42612 Layout: 45106 Graphics: No Graphics CLEAN

23. Subsidiary Guarantors of Senior Notes due 2013

The following tables present condensed consolidating financial information for (a) The Manitowoc Company, Inc. (Parent); (b) the guarantors of the Senior Notes due 2013, which include substantially all of the domestic, wholly-owned subsidiaries of the company (Subsidiary Guarantors); and (c) the wholly and partially owned foreign subsidiaries of the Parent, which do not guarantee the Senior Notes due 2013 (Non-Guarantor Subsidiaries). Separate financial statements of the Subsidiary Guarantors are not presented because the guarantors are fully and unconditionally, jointly and severally liable under the guarantees, and 100% owned by the Parent. During the fourth quarter of 2009, the company changed the method of allocating the provision for taxes on earnings between parent, guarantor subsidiaries and non guarantor subsidiaries from a pro rata methodology to a method that approximates the income tax as determined on a separate return basis. This change in method reduced tax expense of the guarantor subsidiaries and reduced the tax benefit of the parent by $209.4 million and $46.3 million in 2009 and 2008, respectively. The change would not have been material in 2007. Refer to Note 26 for updated information regarding guarantors.

Condensed Consolidating Statement of Operations For the year ended December 31, 2009

Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $1,585.1 $2,637.1 $ (439.6) $3,782.6 Costs and expenses: Cost of sales — 1,283.3 2,114.3 (439.6) 2,958.0 Engineering, selling and administrative expenses 41.2 132.4 376.1 — 549.7 Restructuring expense — 11.1 28.5 — 39.6 Amortization expense — 2.0 37.5 — 39.5 Goodwill and intangible asset impairment — — 700.0 — 700.0 Loss on sale of product lines —— 3.4 — 3.4 Integration expense — 3.3 0.3 — 3.6 Equity in (earnings) loss of subsidiaries 641.3 (7.0) — (634.3) — Total costs and expenses 682.5 1,425.1 3,260.1 (1,073.9) 4,293.8 Operating earnings (loss) from continuing operations (682.5) 160.0 (623.0) 634.3 (511.2) Other income (expenses): Interest expense (160.5) (3.1) (10.4) — (174.0) Amortization of deferred financing fees (28.8) — — — (28.8) Loss on debt extinguishment (9.2) — — — (9.2) Management fee income (expense) 38.8 (27.4) (11.4) — — Other income (expense) — net 100.0 (17.5) (64.7) — 17.8 Total other expenses (59.7) (48.0) (86.5) — (194.2) Earnings (loss) from continuing operations before taxes on earnings (742.2) 112.0 (709.5) 634.3 (705.4) Provision (benefit) for taxes on earnings (38.0) 48.1 (68.9) — (58.8) Earnings (loss) from continuing operations (704.2) 63.9 (640.6) 634.3 (646.6) Discontinued operations: Loss from discontinued operations, net of income taxes — (2.3) (33.6) — (35.9) Gain (loss) on sale of discontinued operations, net of income taxes — 0.8 (25.0) — (24.2) Net earnings (loss) (704.2) 62.4 (699.2) 634.3 (706.7) Less: Net loss attributable to noncontrolling interest — — (2.5) — (2.5) Net earnings (loss) attributable to Manitowoc $(704.2) $ 62.4 $ (696.7) $ 634.3 $ (704.2)

The Manitowoc Company, Inc. — 2009 Form 10-K 79

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 33 CHKSUM Content: 22425 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Operations For the year ended December 31, 2008

Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $2,400.0 $2,776.4 $(673.4) $4,503.0 Costs and expenses: Cost of sales — 1,940.2 2,220.4 (673.4) 3,487.2 Engineering, selling and administrative expenses 53.9 165.6 235.6 — 455.1 Restructuring expense — 0.1 21.6 — 21.7 Amortization expense — 2.0 9.6 — 11.6 Integration expense — 7.6 —— 7.6 Equity in (earnings) loss of subsidiaries (207.7) (8.5) — 216.2 — Total costs and expenses (153.8) 2,107.0 2,487.2 (457.2) 3,983.2 Operating earnings (loss) from continuing operations 153.8 293.0 289.2 (216.2) 519.8 Other income (expenses): Interest expense (35.3) (3.7) (15.1) — (54.1) Loss on currency hedges (379.4) — — — (379.4) Loss on debt extinguishment (4.1) — —— (4.1) Management fee income (expense) 52.5 (46.8) (5.7) — — Other income (expense) — net 101.4 (10.9) (93.5) — (3.0) Total other expenses (264.9) (61.4) (114.3) — (440.6) Earnings (loss) from continuing operations before taxes on earnings (111.1) 231.6 174.9 (216.2) 79.2 Provision (benefit) for taxes on earnings (121.1) 56.4 45.5 — (19.2) Earnings (loss) from continuing operations 10.0 175.2 129.4 (216.2) 98.4 Discontinued operations: Earnings from discontinued operations, net of income taxes — (139.9) (3.5) — (143.4) Gain on sale of discontinued operations, net of income taxes — 53.1 — — 53.1 Net earnings (loss) 10.0 88.4 125.9 (216.2) 8.1 Less: Net loss attributable to noncontrolling interest — — (1.9) — (1.9) Net earnings (loss) attributable to Manitowoc $ 10.0 $ 88.4 $ 127.8 $(216.2) $ 10.0

80 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 34 CHKSUM Content: 17987 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Operations For the year ended December 31, 2007

Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $2,097.4 $2,091.2 $(504.6) $3,684.0 Costs and expenses: Cost of sales — 1,658.5 1,668.6 (504.6) 2,822.5 Engineering, selling and administrative expenses 47.1 163.2 167.6 — 377.9 Gain on sale of parts line — (3.3) — — (3.3) Pension settlements 1.3 — 4.0 — 5.3 Amortization expense — 1.9 3.9 — 5.8 Equity in (earnings) loss of subsidiaries (303.2) (5.2) — 308.4 — Total costs and expenses (254.8) 1,815.1 1,844.1 (196.2) 3,208.2 Operating earnings (loss) from continuing operations 254.8 282.3 247.1 (308.4) 475.8 Other income (expenses): Interest expense (22.6) (4.8) (8.8) — (36.2) Loss on debt extinguishment (12.5) — — — (12.5) Management fee income (expense) 59.5 (60.3) 0.8 — — Other income (expense) — net 70.6 (18.7) (42.1) — 9.8 Total other expenses 95.0 (83.8) (50.1) — (38.9) Earnings (loss) from continuing operations before taxes on earnings 349.8 198.5 197.0 (308.4) 436.9 Provision (benefit) for taxes on earnings (loss) 13.1 54.5 54.5 — 122.1 Earnings (loss) from continuing operations 336.7 144.0 142.5 (308.4) 314.8 Discontinued operations: Earnings from discontinued operations, net of income taxes — 20.7 1.2 — 21.9 Net earnings (loss) 336.7 164.7 143.7 (308.4) 336.7 Less: Net loss attributable to noncontrolling interest —— —— — Net earnings (loss) attributable to Manitowoc $ 336.7 $ 164.7 $ 143.7 $(308.4) $ 336.7

The Manitowoc Company, Inc. — 2009 Form 10-K 81

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 35 CHKSUM Content: 19748 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Balance Sheet As of December 31, 2009 Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets: Cash and cash equivalents $ 18.0 $ 10.6 $ 77.2 $ — $ 105.8 Marketable securities 2.6 — — — 2.6 Restricted cash 5.1 — 1.4 — 6.5 Accounts receivable — net 0.4 51.8 271.0 — 323.2 Inventories — net — 151.5 444.0 — 595.5 Deferred income taxes 109.6 — 32.4 — 142.0 Other current assets 27.5 5.8 51.0 — 84.3 Total current assets 163.2 219.7 877.0 — 1,259.9 Property, plant and equipment — net 11.3 217.7 444.7 — 673.7 Goodwill — 278.4 968.4 — 1,246.8 Other intangible assets — net — 67.6 889.8 — 957.4 Other non-current assets 108.0 10.1 22.8 — 140.9 Investment in affiliates 3,418.4 32.1 — (3,513.5) — Total assets $3,763.9 $ 825.6 $3,202.7 $(3,513.5) $4,278.7 Liabilities and Equity Current Liabilities: Accounts payable and accrued expenses $ 47.5 $ 116.1 $ 638.0 $ — $ 801.6 Short-term borrowings and current portion of long-term debt 105.2 0.6 39.1 — 144.9 Customer advances — 30.5 40.7 — 71.2 Product warranties — 35.0 61.5 — 96.5 Product liabilities — 18.6 9.4 — 28.0 Total current liabilities 152.7 200.8 788.7 — 1,142.2 Non-Current Liabilities: Long-term debt, less current portion 2,008.4 3.0 16.1 — 2,027.5 Deferred income taxes 234.9 — (20.1) — 214.8 Pension obligations 11.0 3.0 33.4 — 47.4 Postretirement health and other benefit obligations 55.7 — 3.1 — 58.8 Intercompany 593.3 (2,303.8) 1,710.5 — — Long-term deferred revenue — 5.0 26.8 — 31.8 Other non-current liabilities 100.0 13.0 36.0 — 149.0 Total non-current liabilities 3,003.3 (2,279.8) 1,805.8 — 2,529.3 Equity: Manitowoc stockholders’ equity 607.9 2,904.6 608.9 (3,513.5) 607.9 Noncontrolling interest — — (0.7) — (0.7) Total equity 607.9 2,904.6 608.2 (3,513.5) 607.2 Total liabilities and stockholders’ equity $3,763.9 $ 825.6 $3,202.7 $(3,513.5) $4,278.7

82 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 36 CHKSUM Content: 18932 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Balance Sheet As of December 31, 2008 Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets: Cash and cash equivalents $ 2.1 $ 60.6 $ 110.3 $ — $ 173.0 Marketable securities 2.6 — — — 2.6 Restricted cash 5.1 — — — 5.1 Accounts receivable — net 0.3 127.6 480.3 — 608.2 Inventories — net — 286.5 638.8 — 925.3 Deferred income taxes 53.5 — 84.6 — 138.1 Other current assets 116.6 12.4 48.9 — 177.9 Current assets of discontinued operations — — 124.8 — 124.8 Total current assets 180.2 487.1 1,487.7 — 2,155.0 Property, plant and equipment — net 11.5 226.9 490.4 — 728.8 Goodwill — 278.7 1,611.8 — 1,890.5 Other intangible assets — net — 69.6 939.4 — 1,009.0 Deferred income taxes 25.0 — (25.0) — — Other non-current assets 143.1 12.8 23.8 — 179.7 Long-term assets of discontinued operations — — 123.1 — 123.1 Investment in affiliates 2,461.8 23.6 — (2,485.4) — Total assets $ 2,821.6 $ 1,098.7 $4,651.2 $(2,485.4) $6,086.1 Liabilities and Equity Current Liabilities: Accounts payable and accrued expenses $ 66.6 $ 319.5 $ 820.2 $ — $1,206.3 Short-term borrowings and current portion of long-term debt 114.6 — 67.7 — 182.3 Customer advances — 23.6 24.9 — 48.5 Product warranties — 40.2 61.8 — 102.0 Product liabilities — 23.3 11.1 — 34.4 Current liabilities of discontinued operations — — 44.6 — 44.6 Total current liabilities 181.2 406.6 1,030.3 — 1,618.1 Non-Current Liabilities: Long-term debt, less current portion 2,458.8 — 14.2 — 2,473.0 Deferred income taxes — — 283.7 — 283.7 Pension obligations 9.6 3.2 35.2 — 48.0 Postretirement health and other benefit obligations 51.6 — 4.3 — 55.9 Intercompany (1,248.7) (1,156.2) 2,404.9 — — Long-term deferred revenue — 9.5 46.8 — 56.3 Other non-current liabilities 46.8 16.3 165.7 — 228.8 Total non-current liabilities 1,318.1 (1,127.2) 2,954.8 — 3,145.7 Equity: Manitowoc stockholders’ equity 1,322.3 1,819.3 664.3 (2,485.4) 1,320.5 Noncontrolling interest — — 1.8 — 1.8 Total equity 1,322.3 1,819.3 666.1 (2,485.4) 1,322.3 Total liabilities and stockholders’ equity $ 2,821.6 $ 1,098.7 $4,651.2 $(2,485.4) $6,086.1

The Manitowoc Company, Inc. — 2009 Form 10-K 83

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 37 CHKSUM Content: 13556 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2009

Non- Subsidiary Guarantor Parent Guarantors Subsidiaries Eliminations Consolidated Net cash provided by (used for) operating activities of continuing operations $ 42.0 $ 110.2 $ 210.5 $— $ 362.7 Cash provided by (used for) operating activities of discontinued operations — (10.2) (13.9) — (24.1) Net cash provided by (used for) operating activities 42.0 100.0 196.6 — 338.6 Cash Flows from Investing: Capital expenditures (2.1) (24.7) (45.7) — (72.5) Restricted cash — — (1.4) — (1.4) Proceeds from sale of property, plant and equipment — 0.3 4.3 — 4.6 Proceeds from the sale of product lines — — 15.0 — 15.0 Proceeds from sale of business — 0.9 148.3 — 149.2 Intercompany investments 462.6 (126.5) (336.1) — — Net cash provided by (used for) investing activities 460.5 (150.0) (215.6) — 94.9 Cash Flows from Financing: Proceeds from long-term debt — 3.7 132.6 — 136.3 Payments on long-term debt (443.0) — (150.8) — (593.8) Payments on revolving credit facility — net (17.0) — —— (17.0) Payments on notes financing — net — (3.7) (1.7) — (5.4) Debt issuance costs (18.1) — —— (18.1) Dividends paid (10.5) — —— (10.5) Exercises of stock options 2.0 — —— 2.0 Net used for financing activities (486.6) — (19.9) — (506.5) Effect of exchange rate changes on cash — — 5.8 — 5.8 Net increase (decrease) in cash and cash equivalents 15.9 (50.0) (33.1) — (67.2) Balance at beginning of period 2.1 60.6 110.3 — 173.0 Balance at end of period $ 18.0 $ 10.6 $ 77.2 $— $ 105.8

84 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 38 CHKSUM Content: 36541 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2008

Non- Subsidiary Guarantor Parent Guarantors Subsidiaries Eliminations Consolidated Net cash provided by (used for) operating activities of continuing operations $ 28.1 $ 157.4 $ 101.0 $— $ 286.5 Cash provided by (used for) operating activities of discontinued operations — 26.0 (3.5) — 22.5 Net cash provided by (used for) operating activities 28.1 183.4 97.5 — 309.0 Cash Flows from Investing: Business acquisitions, net of cash acquired — — (2,030.6) — (2,030.6) Settlement of hedges related to acquisitions (379.4) — —— (379.4) Capital expenditures (3.6) (82.4) (64.3) — (150.3) Restricted cash 10.5 — 1.1 — 11.6 Proceeds from sale of property, plant and equipment — 0.7 9.3 — 10.0 Proceeds from sale of business — 118.5 —— 118.5 Purchase of marketable securities (0.1) — —— (0.1) Intercompany investments (2,149.3) (181.5) 2,330.8 — — Net cash provided by (used for) investing activities of continuing operations (2,521.9) (144.7) 246.3 — (2,420.3) Net cash used for investing activities of discontinued operations — (4.9) —— (4.9) Net cash provided by (used for) investing activities (2,521.9) (149.6) 246.3 — (2,425.2) Cash Flows from Financing: Proceeds from long-term debt 2,695.0 — 74.3 — 2,769.3 Payments on long-term debt (301.4) — (392.4) — (693.8) Payments on revolving credit facility — net — — (54.6) — (54.6) Payments on notes financing — net — (0.9) (2.9) — (3.8) Debt issuance costs (90.8) — —— (90.8) Dividends paid (10.4) — —— (10.4) Exercises of stock options 8.5 — —— 8.5 Net cash provided by (used for) financing activities of continuing operations 2,300.9 (0.9) (375.6) — 1,924.4 Net cash provided by financing activities of discontinued operations — 2.5 —— 2.5 Net cash provided by (used for) financing activities 2,300.9 1.6 (375.6) — 1,926.9 Effect of exchange rate changes on cash — — (4.6) — (4.6) Net increase (decrease) in cash and cash equivalents (192.9) 35.4 (36.4) — (193.9) Balance at beginning of period 195.0 25.2 146.7 — 366.9 Balance at end of period $ 2.1 $ 60.6 $ 110.3 $— $ 173.0

The Manitowoc Company, Inc. — 2009 Form 10-K 85

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 39 CHKSUM Content: 23188 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2007

Non- Subsidiary Guarantor Parent Guarantors Subsidiaries Eliminations Consolidated Net cash provided by (used in) operating activities of continuing operations $ 63.7 $ 141.2 $ 10.7 $— $ 215.6 Cash provided by operating activities of discontinued operations — 27.2 1.2 — 28.4 Net cash provided by (used in) operating activities 63.7 168.4 11.9 — 244.0 Cash Flows from Investing: Business acquisition — (15.9) (64.0) — (79.9) Capital expenditures (2.4) (47.9) (62.5) — (112.8) Restricted cash (0.5) — (1.1) — (1.6) Proceeds from sale of property, plant and equipment — 0.3 9.5 — 9.8 Proceeds from sale of parts product line — 4.8 — — 4.8 Purchase of marketable securities (0.1) — — — (0.1) Intercompany investments 52.4 (98.4) 46.0 — — Net cash provided by (used for) investing activities of continuing operations 49.4 (157.1) (72.1) — (179.8) Net cash used for investing activities of discontinued operations — (6.8) — — (6.8) Net cash provided by (used for) investing activities 49.4 (163.9) (72.1) — (186.6) Cash Flows from Financing: Proceeds from long-term debt — — 19.8 — 19.8 Proceeds from (payments on revolving credit facility) — — 56.7 — 56.7 Payments on long-term debt (113.7) — (9.8) — (123.5) Payments on notes financing — (3.4) (0.9) — (4.3) Net proceeds of equity offering 157.1 — — — 157.1 Dividends paid (9.5) — — — (9.5) Exercises of stock options 27.6 — — — 27.6 Net cash used for financing activities 61.5 (3.4) 65.8 — 123.9 Effect of exchange rate changes on cash — — 10.7 — 10.7 Net increase (decrease) in cash and cash equivalents 174.6 1.1 16.3 — 192.0 Balance at beginning of period 20.4 24.1 130.4 — 174.9 Balance at end of period $ 195.0 $ 25.2 $146.7 $— $ 366.9

86 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 40 CHKSUM Content: 8534 Layout: 31613 Graphics: No Graphics CLEAN

24. Quarterly Financial Data (Unaudited)

The following table presents quarterly financial data for 2009 and 2008:

2009 2008 First Second Third Fourth First Second Third Fourth Net sales $1,027.6 $1,034.8 $881.5 $838.7 $988.5 $1,191.1 $1,106.8 $1,216.6 Gross profit 205.0 236.8 201.5 181.3 242.8 287.1 243.7 242.2 Earnings from continuing operations (628.5)* 13.2* (9.7)* (21.6) 95.3 121.2 (38.6) (79.4) Discontinued operations: Earnings (loss) from discontinued operations, net of income taxes (28.4) (3.0) (1.8) (2.7) 7.3 12.7 11.7 (175.1) Gain (loss) on sale of discontinued operations, net of income taxes — (23.2) (2.6) 1.6 — — — 53.1 Net earnings (loss) $ (656.9) $ (13.0) $ (14.1) $ (22.7) $102.6 $ 133.9 $ (26.9) $ (201.4) Less: Net earnings (loss) attributable to noncontrolling interest, net of tax (1.0) (0.7) (1.5) 0.7 — (0.1) (0.8) (1.0) Net earnings (loss) attributable to Manitowoc $ (655.9) $ (12.3) $ (12.6) $ (23.4) $102.6 $ 133.8 $ (26.1) $ (200.4) Basic earnings per share: Earnings (loss) from continuing operations attributable to Manitowoc common shareholders $ (4.82) $ 0.11 $ (0.07) $ (0.17) $ 0.73 $ 0.93 $ (0.29) $ (0.60) Discontinued operations: Earnings (loss) from discontinued operations attributable to Manitowoc common shareholders (0.22) (0.02) (0.01) (0.02) 0.06 0.10 0.09 (1.35) Gain (loss) on sale of discontinued operations, net of income taxes — (0.18) (0.02) 0.01 — — — 0.41 Earnings (loss) per share attributable to Manitowoc common shareholders $ (5.04) $ (0.09) $ (0.10) $ (0.18) $ 0.79 $ 1.03 $ (0.20) $ (1.54) Diluted earnings per share: Earnings (loss) from continuing operations attributable to Manitowoc common shareholders $ (4.82) $ 0.11 $ (0.07) $ (0.17) $ 0.72 $ 0.92 $ (0.29) $ (0.60) Discontinued operations: Earnings (loss) from discontinued operations attributable to Manitowoc common shareholders (0.22) (0.02) (0.01) (0.02) 0.06 0.10 0.09 (1.35) Gain (loss) on sale of discontinued operations, net of income taxes — (0.18) (0.02) 0.01 — — — 0.41 Earnings (loss) per share attributable to Manitowoc common shareholders $ (5.04) $ (0.09) $ (0.10) $ (0.18) $ 0.78 $ 1.02 $ (0.20) $ (1.54) Dividends per common share $ 0.02 $ 0.02 $ 0.02 $ 0.02 $ 0.02 $ 0.02 $ 0.02 $ 0.02

* Revised to reflect the error correction related to amortization of deferred financing fees as discussed in Note 1. • Includes expense, net of tax, of $112.3 million and $120.4 million recorded in the 3rd and 4th quarters of 2008, respectively, in relation to hedges on the purchase price of Enodis.

25. Sale of Product and Parts Lines peelers). The Merco product category was sold to Hatco Corporation and included food warming equipment, During December of 2009, the company sold two product merchandisers, toasters, and racking/dispensing systems. lines within its Foodservice segment for aggregate net pro- The company recorded a loss of $3.3 million for the sale of ceeds of $15.0 million and recognized a loss on the sale of the Smallwares products and a loss of $0.1 million for the $3.4 million. The two product lines that were divested were sale of the Merco products. the company’s Lincoln Smallwares products and its Merco On April 3, 2007, we sold all of our aftermarket replacement product category. The Smallwares products was sold to The parts and rights to manufacture, sell and service aftermarket Vollrath Company, L.L.C. and included products such as replacement parts for all the models of the Grove Manlift aer- pots, pans, baking sheets and other cooking implements as ial work platform product line around the world to MinnPar well as manual food-preparation equipment (i.e. slicers, LLC (MinnPar). We received $4.9 million in proceeds and

The Manitowoc Company, Inc. — 2009 Form 10-K 87

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 41 CHKSUM Content: 10288 Layout: 36279 Graphics: No Graphics CLEAN

recognized a gain of $3.3 million, which is recorded in gain on most recent four fiscal quarters (Consolidated Senior sale of parts line in the Consolidated Statement of Operations Secured Indebtedness Ratio), beginning with the fiscal quar- for the year ended December 31, 2007. ter ending December 31, 2010, must meet certain defined limits listed below: 26. Subsequent Events Consolidated On January 21, 2010, the company entered into an amend- Senior Secured ment (January 2010 Amendment) to the New Credit Agree- Leverage ment. The January 2010 Amendment, among other things, Fiscal quarter ending: Ratio amends the definition of Consolidated Earnings Before Inter- (less than) est and Taxes (EBIT) to provide add-backs for certain addi- December 31, 2010 5.00:1 tional cash restructuring charges, amends certain financial March 31, 2011 5.00:1 ratios that the company is required to maintain, including June 30, 2011 5.00:1 (i) reducing the minimum permitted level of the Consoli- September 30, 2011 5.00:1 dated Interest Coverage Ratio, (ii) increasing the maximum permitted level of the Maximum Consolidated Total Lever- December 31, 2011 4.25:1 age Ratio, and (iii) adjusting the start date for measurement March 31, 2012 4.25:1 of the Consolidated Senior Secured Leverage Ratio to June 30, 2012 4.00:1 December 31, 2010 and reducing the maximum permitted September 30, 2012 3.75:1 level for this ratio. December 31, 2012 3.50:1 The January 2010 Amendment contains financial March 31, 2013 3.25:1 covenants whereby the ratio of (a) consolidated earnings June 30, 2013 3.25:1 before interest, taxes, depreciation and amortization, and September 30, 2013 3.25:1 other adjustments (EBITDA), as defined in the New Credit December 31, 2013 and thereafter 3.00:1 Agreement to (b) consolidated interest expense, each for the most recent four fiscal quarters (Consolidated Interest On February 3, 2010, in accordance with its previously Coverage Ratio) and the ratio of (c) consolidated indebted- announced intentions, the company entered into an Under- ness to (d) consolidated EBITDA for the most recent four fis- writing Agreement with J.P. Morgan Securities Inc. as repre- cal quarters (Consolidated Total Leverage Ratio), at all times sentative of several underwriters, pursuant to which the must each meet certain defined limits listed below: company agreed to sell, and the underwriters agreed to purchase $400 million of the company’s 9.50% Senior Notes Consolidated due 2018 to be guaranteed by guarantors in a public offering Consolidated Interest which closed on February 8, 2010. Net proceeds of $392.0 Total Leverage Coverage million from this offering were used to partially pay down Fiscal Quarter Ending: Ratio Ratio ratably the then outstanding balances on Term Loan A and (less than) (greater than) Term Loan B. March 31, 2010 7.80:1 1.75:1 The Senior Notes due 2018 are unsecured senior obliga- June 30, 2010 7.80:1 1.75:1 tions ranking subordinate to all existing senior secured September 30, 2010 7.25:1 1.80:1 indebtedness and equal to all existing senior unsecured obli- December 31, 2010 6.625:1 1.85:1 gations. The Senior Notes due 2018 are jointly and severally March 31, 2011 6.50:1 2.00:1 and fully guaranteed on a senior unsecured basis by all of our existing and future domestic restricted subsidiaries that June 30, 2011 6.375:1 2.00:1 guarantee our senior secured credit facilities. Interest on the September 30, 2011 6.250:1 2.125:1 Senior Notes due 2018 is payable semiannually in December 31, 2011 5.75:1 2.25:1 February and August of each year. The Senior Notes due March 31, 2012 5.75:1 2.375:1 2018 may be redeemed in whole or in part by the company June 30, 2012 5.25:1 2.50:1 for a premium at any time prior to February 15, 2014. The September 30, 2012 4.75:1 2.50:1 premium is calculated as the greater of (1) 1.0% of the prin- December 31, 2012 4.50:1 2.75:1 cipal amount of such note; and (2) the excess of (a) the pres- March 31, 2013 4.50:1 2.75:1 ent value at such redemption dated of (i) the redemption June 30, 2013 4.25:1 3.00:1 price of such note on February 15, 2014 plus (ii) all required September 30, 2013 3.75:1 3.00:1 remaining scheduled interest payments due on such note December 31, 2013 and thereafter 3.50:1 3.00:1 through February 15, 2014, computed using a discount rate equal to the treasury rate plus 50 basis points; over (b) the principal amount of such note on such redemption date. In In addition, the January 2010 Amendment contains a addition, the company may redeem at its option, in whole or financial covenant whereby the ratio of (e) consolidated sen- in part, at the following redemption prices if it redeems the ior secured indebtedness to (f) consolidated EBITDA for the

88 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 42 CHKSUM Content: 32879 Layout: 38888 Graphics: No Graphics CLEAN

Senior Notes due 2018 during the 12-month period com- Manitowoc Company, Inc. (Parent); (b) the guarantors of the mencing on February 15 of the year set forth below: Senior Unsecured Notes due 2018, which include substantially all of the domestic 100% owned subsidiaries of the Year Percentage company (Subsidiary Guarantors); and (c) the 100% and par- 2014 104.750% tially owned foreign subsidiaries of the company, which do not guarantee the Senior Unsecured Notes due 2018 (Non- 2015 102.375% Guarantor Subsidiaries). Separate financial statements of the 2016 and thereafter 100.000% Subsidiary Guarantors are not presented because the guarantors are fully and unconditionally, jointly and severally In addition, at any time, or from time to time, on or prior to liable under the guarantees, and 100% owned by the com- February 15, 2013, the company may, at its option, use the pany. In January of 2010, the Notes due 2013 were net cash proceeds of one or more public equity offerings to amended to conform those guarantors with the guarantors redeem up to 35% of the principal amount of the Senior of the Notes due 2018. During the fourth quarter of 2009, Notes due 2018 outstanding at a redemption price of the company changed the method of allocating the provi- 109.500% of the principal amount thereof plus accrued and sion for taxes on earnings between parent, guarantor sub- unpaid interest thereon, if any, to the date of redemption; sidiaries and non guarantor subsidiaries from a pro rata provided that: methodology to a method that approximates the income tax

(1) as determined on a separate return basis. This change in At least 65% of the principal amount of the Senior Notes due 2018 out- method increased the parent 2009 tax benefit by $32.9 mil- standing remains outstanding immediately after any such redemption; and (2) The company makes such redemption not more than 90 days after the lion and reduced the parent 2008 tax benefit by $75.0 mil- consummation of any such public offering. lion, with offsetting amounts in each year adjusting the income tax provision of the guarantor subsidiaries. The The following tables present condensed consolidating change would not have been material in 2007. financial information for (a) the parent company, The

The Manitowoc Company, Inc. — 2009 Form 10-K 89

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 43 CHKSUM Content: 21329 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Operations For the year ended December 31, 2009

Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $2,114.7 $2,157.4 $ (489.5) $3,782.6 Costs and expenses: Cost of sales — 1,631.7 1,815.8 (489.5) 2,958.0 Engineering, selling and administrative expenses 41.3 211.2 297.2 — 549.7 Restructuring expense — 11.3 28.3 — 39.6 Amortization expense — 31.7 7.8 — 39.5 Goodwill and intangible asset impairment — 448.1 251.9 — 700.0 Loss on sale of product lines —— 3.4 — 3.4 Integration expense — 3.5 0.1 — 3.6 Equity in (earnings) loss of subsidiaries 641.2 (43.5) — (597.7) — Total costs and expenses 682.5 2,294.0 2,404.5 (1,087.2) 4,293.8 Operating earnings (loss) from continuing operations (682.5) (179.3) (247.1) 597.7 (511.2) Other income (expenses): Interest expense (160.5) (1.2) (12.3) — (174.0) Amortization of deferred financing fees (28.8) — — — (28.8) Loss on debt extinguishment (9.2) — — — (9.2) Management fee income (expense) 38.8 (68.3) 29.5 — — Other income (expense) — net 100.0 (73.9) (8.3) — 17.8 Total other expenses (59.7) (143.4) 8.9 — (194.2) Earnings (loss) from continuing operations before taxes on earnings (742.2) (322.7) (238.2) 597.7 (705.4) Provision (benefit) for taxes on earnings (38.0) 14.8 (35.6) — (58.8) Earnings (loss) from continuing operations (704.2) (337.5) (202.6) 597.7 (646.6) Discontinued operations: Loss from discontinued operations, net of income taxes — (2.3) (33.6) — (35.9) Gain (loss) on sale of discontinued operations, net of income taxes — 0.8 (25.0) — (24.2) Net earnings (loss) (704.2) (339.0) (261.2) 597.7 (706.7) Less: Net loss attributable to noncontrolling interest — — (2.5) — (2.5) Net earnings (loss) attributable to Manitowoc $(704.2) $ (339.0) $ (258.7) $ 597.7 $ (704.2)

90 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 44 CHKSUM Content: 47510 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Operations For the year ended December 31, 2008

Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $2,475.6 $2,710.5 $(683.1) $4,503.0 Costs and expenses: Cost of sales — 1,996.3 2,174.0 (683.1) 3,487.2 Engineering, selling and administrative expenses 53.8 176.2 225.1 — 455.1 Restructuring expense — 0.1 21.6 — 21.7 Amortization expense — 6.4 5.2 — 11.6 Integration expense — 7.6 — — 7.6 Equity in (earnings) loss of subsidiaries (208.1) (151.0) — 359.1 — Total costs and expenses (154.3) 2,035.6 2,425.9 (324.0) 3,983.2 Operating earnings (loss) from continuing operations 154.3 440.0 284.6 (359.1) 519.8 Other income (expenses): Interest expense (35.3) (1.0) (17.8) — (54.1) Loss on currency hedges (379.4) — — — (379.4) Loss on debt extinguishment (4.1) — — — (4.1) Management fee income (expense) 52.0 (44.6) (7.4) — — Other income (expense) — net 101.4 (29.5) (74.9) — (3.0) Total other expenses (265.4) (75.1) (100.1) — (440.6) Earnings (loss) from continuing operations before taxes on earnings (111.1) 364.9 184.5 (359.1) 79.2 Provision (benefit) for taxes on earnings (121.1) 56.4 45.5 — (19.2) Earnings (loss) from continuing operations 10.0 308.5 139.0 (359.1) 98.4 Discontinued operations: Earnings (loss) from discontinued operations, net of income taxes — (139.9) (3.5) — (143.4) Gain on sale of discontinued operations, net of income taxes — 53.1 — — 53.1 Net earnings (loss) 10.0 221.7 135.5 (359.1) 8.1 Less: Net loss attributable to noncontrolling interest — — (1.9) — (1.9) Net earnings (loss) attributable to Manitowoc $ 10.0 $ 221.7 $ 137.4 $(359.1) $ 10.0

The Manitowoc Company, Inc. — 2009 Form 10-K 91

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 45 CHKSUM Content: 7921 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Operations For the year ended December 31, 2007

Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $2,097.4 $2,091.2 $(504.6) $3,684.0 Costs and expenses: Cost of sales — 1,658.5 1,668.6 (504.6) 2,822.5 Engineering, selling and administrative expenses 47.1 161.7 169.1 — 377.9 Gain on sale of parts line — (3.3) — — (3.3) Pension settlements 1.3 — 4.0 — 5.3 Amortization expense — 1.9 3.9 — 5.8 Equity in (earnings) loss of subsidiaries (302.9) 1.1 — 301.8 — Total costs and expenses (254.5) 1,819.9 1,845.6 (202.8) 3,208.2 Operating earnings (loss) from continuing operations 254.5 277.5 245.6 (301.8) 475.8 Other income (expenses): Interest expense (22.6) — (13.6) — (36.2) Loss on debt extinguishment (12.5) — — — (12.5) Management fee income (expense) 59.5 (60.3) 0.8 — — Other income (expense) — net 70.6 (18.7) (42.1) — 9.8 Total other expenses 95.0 (79.0) (54.9) — (38.9) Earnings (loss) from continuing operations before taxes on earnings 349.5 198.5 190.7 (301.8) 436.9 Provision for taxes on earnings 12.8 54.8 54.5 — 122.1 Earnings (loss) from continuing operations 336.7 143.7 136.2 (301.8) 314.8 Discontinued operations: Earnings from discontinued operations, net of income taxes — 20.7 1.2 — 21.9 Net earnings (loss) 336.7 164.4 137.4 (301.8) 336.7 Less: Net loss attributable to noncontrolling interest —— — — — Net earnings (loss) attributable to Manitowoc $ 336.7 $ 164.4 $ 137.4 $(301.8) $ 336.7

92 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 46 CHKSUM Content: 15867 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Balance Sheet As of December 31, 2009 Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets: Cash and cash equivalents $ 18.0 $ 7.0 $ 80.8 $ — $ 105.8 Marketable securities 2.6 — — — 2.6 Restricted cash 5.1 — 1.4 — 6.5 Accounts receivable — net 0.4 10.0 312.8 — 323.2 Inventories — net — 188.4 407.1 — 595.5 Deferred income taxes 109.6 — 32.4 — 142.0 Other current assets 27.5 6.4 50.4 — 84.3 Total current assets 163.2 211.8 884.9 — 1,259.9 Property, plant and equipment — net 11.3 303.0 359.4 — 673.7 Goodwill — 1,026.9 219.9 — 1,246.8 Other intangible assets — net — 745.0 212.4 — 957.4 Other non-current assets 107.9 15.5 17.5 — 140.9 Investment in affiliates 4,063.6 3,321.0 — (7,384.6) — Total assets $4,346.0 $5,623.2 $ 1,694.1 $(7,384.6) $4,278.7 Liabilities and Equity Current Liabilities: Accounts payable and accrued expenses $ 47.5 $ 316.4 $ 437.7 $ — $ 801.6 Short-term borrowings and current portion of long-term debt 105.2 0.7 39.0 — 144.9 Customer advances — 30.5 40.7 — 71.2 Product warranties — 49.5 47.0 — 96.5 Product liabilities — 21.7 6.3 — 28.0 Total current liabilities 152.7 418.8 570.7 — 1,142.2 Non-Current Liabilities: Long-term debt, less current portion 2,008.4 5.1 14.0 — 2,027.5 Deferred income taxes 234.9 — (20.1) — 214.8 Pension obligations 11.0 13.5 22.9 — 47.4 Postretirement health and other benefit obligations 55.7 — 3.1 — 58.8 Intercompany 1,175.4 326.8 (1,500.2) — — Long-term deferred revenue — 5.5 26.3 — 31.8 Other non-current liabilities 100.0 21.3 27.7 — 149.0 Total non-current liabilities 3,585.4 370.2 (1,426.3) — 2,529.3 Equity: Manitowoc stockholders’ equity 607.9 4,834.2 2,550.4 (7,384.6) 607.9 Noncontrolling interest — — (0.7) — (0.7) Total equity 607.9 4,834.2 2,549.7 (7,384.6) 607.2 Total liabilities and stockholders’ equity $4,346.0 $ 5,623.2 $ 1,694.1 $(7,384.6) $4,278.7

The Manitowoc Company, Inc. — 2009 Form 10-K 93

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 47 CHKSUM Content: 16277 Layout: 52579 Graphics: No Graphics CLEAN

Condensed Consolidating Balance Sheet As of December 31, 2008 Non- Guarantor Guarantor (In millions of dollars) Parent Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets: Cash and cash equivalents $ 2.1 $ 50.8 $ 120.1 $ — $ 173.0 Marketable securities 2.6 — — — 2.6 Restricted cash 5.1 — — — 5.1 Accounts receivable — net 0.3 64.8 543.1 — 608.2 Inventories — net — 327.6 597.7 — 925.3 Deferred income taxes 53.5 29.3 55.3 — 138.1 Other current assets 116.6 30.5 30.8 — 177.9 Current assets of discontinued operations — 5.7 119.1 — 124.8 Total current assets 180.2 508.7 1,466.1 — 2,155.0 Property, plant and equipment — net 11.6 338.1 379.1 — 728.8 Goodwill — 1,683.2 207.3 — 1,890.5 Other intangible assets — net — 884.3 124.7 — 1,009.0 Deferred income taxes 25.0 66.0 (91.0) — — Other non-current assets 143.0 20.2 16.5 — 179.7 Long-term assets of discontinued operations — 123.1 — — 123.1 Investment in affiliates 1,507.6 603.2 — (2,110.8) — Total assets $ 1,867.4 $ 4,226.8 $ 2,102.7 $(2,110.8) $6,086.1 Liabilities and Equity Current Liabilities: Accounts payable and accrued expenses $ 66.5 $ 485.5 $ 654.3 $ — $1,206.3 Short-term borrowings and current portion of long-term debt 114.6 (1.4) 69.1 — 182.3 Customer advances — 23.7 24.8 — 48.5 Product warranties — 54.6 47.4 — 102.0 Product liabilities — 26.2 8.2 — 34.4 Current liabilities of discontinued operations — 2.0 42.6 — 44.6 Total current liabilities 181.1 590.6 846.4 — 1,618.1 Non-Current Liabilities: Long-term debt, less current portion 2,458.9 2.0 12.1 — 2,473.0 Deferred income taxes — 308.7 (25.0) — 283.7 Pension obligations 9.6 11.9 26.5 — 48.0 Postretirement health and other benefit obligations 51.6 — 4.3 — 55.9 Intercompany (2,201.2) (111.9) 2,313.1 — — Long-term deferred revenue — 10.1 46.2 — 56.3 Other non-current liabilities 46.9 111.8 70.1 — 228.8 Total non-current liabilities 365.8 332.6 2,447.3 — 3,145.7 Equity: Manitowoc stockholders’ equity 1,320.5 3,303.6 (1,192.8) (2,110.8) 1,320.5 Noncontrolling interest — — 1.8 — 1.8 Total equity 1,320.5 3,303.6 (1,191.0) (2,110.8) 1,322.3 Total liabilities and stockholders’ equity $ 1,867.4 $ 4,226.8 $ 2,102.7 $(2,110.8) $6,086.1

94 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 48 CHKSUM Content: 50127 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2009

Non- Subsidiary Guarantor Parent Guarantors Subsidiaries Eliminations Consolidated Net cash provided by (used for) operating activities of continuing operations $ 41.9 $ (86.6) $ 407.4 $ $ 362.7 Cash provided by (used for) operating activities of discontinued operations — (10.2) (13.9) — (24.1) Net cash provided by (used for) operating activities 41.9 (96.8) 393.5 — 338.6 Cash Flows from Investing: Capital expenditures (2.1) (29.3) (41.1) — (72.5) Restricted cash — — (1.4) — (1.4) Proceeds from sale of property, plant and equipment — 0.2 4.4 — 4.6 Proceeds from the sale of product lines — — 15.0 — 15.0 Proceeds from sale of business — 1.0 148.2 — 149.2 Intercompany investments 462.7 79.3 (542.0) — Net cash provided by (used for) investing activities 460.6 51.2 (416.9) — 94.9 Cash Flows from Financing: Proceeds from long-term debt — 9.2 127.1 — 136.3 Payments on long-term debt (443.0) (3.7) (147.1) — (593.8) Payments on revolving credit facility — net (17.0) — —— (17.0) Payments on notes financing — net — (3.7) (1.7) — (5.4) Debt issuance costs (18.1) — —— (18.1) Dividends paid (10.5) — —— (10.5) Exercises of stock options 2.0 — —— 2.0 Net cash provided by (used for) financing activities (486.6) 1.8 (21.7) — (506.5) Effect of exchange rate changes on cash — — 5.8 — 5.8 Net increase (decrease) in cash and cash equivalents 15.9 (43.8) (39.3) — (67.2) Balance at beginning of period 2.1 50.8 120.1 — 173.0 Balance at end of period $ 18.0 $ 7.0 $ 80.8 $— $ 105.8

The Manitowoc Company, Inc. — 2009 Form 10-K 95

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 49 CHKSUM Content: 28947 Layout: 37857 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2008

Non- Subsidiary Guarantor (In millions of dollars) Parent Guarantors Subsidiaries Eliminations Consolidated Net cash provided by (used for) operating activities of continuing operations $ 28.1 $ 94.7 $ 163.7 $— $ 286.5 Cash provided by (used for) operating activities of discontinued operations — 26.0 (3.5) — 22.5 Net cash provided by (used for) operating activities 28.1 120.7 160.2 — 309.0 Cash Flows from Investing: Business acquisitions, net of cash acquired — (2,003.9) (26.7) — (2,030.6) Settlement of hedges related to acquisitions (379.4) — — — (379.4) Capital expenditures (3.6) (83.7) (63.0) — (150.3) Restricted cash 10.5 — 1.1 — 11.6 Proceeds from sale of property, plant and equipment — 0.7 9.3 — 10.0 Proceeds from sale of business — 118.5 — — 118.5 Purchase of marketable securities (0.1) — — — (0.1) Intercompany investments (2,149.4) 1,882.8 266.6 — — Net cash provided by (used for) investing activities of continuing operations (2,522.0) (85.6) 187.3 — (2,420.3) Net cash used for investing activities of discontinued operations — (4.9) — — (4.9) Net cash provided by (used for) investing activities (2,522.0) (90.5) 187.3 — (2,425.2) Cash Flows from Financing: Proceeds from long-term debt 2,695.0 — 74.3 — 2,769.3 Payments on long-term debt (301.3) 0.6 (393.1) — (693.8) Payments on revolving credit facility — net — — (54.6) — (54.6) Payments on notes financing — net — (0.9) (2.9) — (3.8) Debt issuance costs (90.8) — — — (90.8) Dividends paid (10.4) — — — (10.4) Exercises of stock options 8.5 — — — 8.5 Net cash provided by (used for) financing activities of continuing operations 2,301.0 (0.3) (376.3) — 1,924.4 Net cash provided by financing activities of discontinued operations — 2.5 — — 2.5 Net cash provided by (used for) financing activities 2,301.0 2.2 (376.3) — 1,926.9 Effect of exchange rate changes on cash — — (4.6) — (4.6) Net increase (decrease) in cash and cash equivalents (192.9) 32.4 (33.4) — (193.9) Balance at beginning of period 195.0 18.4 153.5 — 366.9 Balance at end of period $ 2.1 $ 50.8 $ 120.1 $— $ 173.0

96 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 50 CHKSUM Content: 42906 Layout: 45106 Graphics: No Graphics CLEAN

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2007

Non- Subsidiary Guarantor (In millions of dollars) Parent Guarantors Subsidiaries Eliminations Consolidated Net cash provided by (used for) operating activities of continuing operations $ 63.8 $ 288.0 $(136.2) $ $ 215.6 Cash used for operating activities of discontinued operations — 27.2 1.2 — 28.4 Net cash provided by (used for) operating activities 63.8 315.2 (135.0) 244.0 Cash Flows from Investing: Business acquisition — (15.9) (64.0) — (79.9) Capital expenditures (2.4) (47.9) (62.5) — (112.8) Restricted cash (0.5) — (1.1) — (1.6) Purchase of marketable securities (0.1) — —— (0.1) Proceeds from sale of property, plant and equipment — 0.3 9.5 — 9.8 Proceeds from sale of parts product line — 4.8 —— 4.8 Intercompany investments 52.3 (252.0) 199.7 — Net cash provided by (used for) investing activities of continuing operations 49.3 (310.7) 81.6 (179.8) Net cash used for investing activities of discontinued operations — (6.8) — — (6.8) Net cash provided by (used for) investing activities 49.3 (317.5) 81.6 (186.6) Cash Flows from Financing: Proceeds from long-term debt — — 19.8 — 19.8 Proceeds from revolving credit facility — — 56.7 — 56.7 Payments on long-term debt (113.7) — (9.8) — (123.5) Payments on notes financing — (3.4) (0.9) — (4.3) Dividends paid (9.5) — —— (9.5) Net proceeds of equity offering 157.1 — — — 157.1 Exercises of stock options 27.6 — —— 27.6 Net cash provided by (used for) financing activities 61.5 (3.4) 65.8 — 123.9 Effect of exchange rate changes on cash — — 10.7 — 10.7 Net increase (decrease) in cash and cash equivalents 174.6 (5.7) 23.1 — 192.0 Balance at beginning of period 20.4 24.1 130.4 — 174.9 Balance at end of period $ 195.0 $ 18.4 $ 153.5 $— $ 366.9

The Manitowoc Company, Inc. — 2009 Form 10-K 97

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:07 | 09-35779-2.da | Sequence: 51 CHKSUM Content: 19248 Layout: 37392 Graphics: No Graphics CLEAN

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH financial reporting during the last fiscal quarter of 2009 that ACCOUNTANTS ON ACCOUNTING AND FINANCIAL have materially affected, or are reasonably likely to materially DISCLOSURE affect, our internal control over financial reporting. None. ITEM 9B. OTHER INFORMATION ITEM 9A. CONTROLS AND PROCEDURES None.

Conclusion Regarding the Effectiveness of Disclosure ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND Controls and Procedures CORPORATE GOVERNANCE The company’s management, with the participation of the company’s Chief Executive Officer and Chief Financial Offi- The information required by this item is incorporated by ref- cer, have evaluated the effectiveness of the company’s dis- erence from the sections of the 2010 Proxy Statement cap- closure controls and procedures (as such term is defined in tioned “Section 16(a) Beneficial Ownership Reporting Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Compliance,” “Audit Committee” and “Election of Directors.” Act of 1934, as amended (“the Exchange Act”)) as of the end See also “Executive Officers of the Registrant” in Part I of the period covered by this report. Based on such evalua- hereof, which is incorporated herein by reference. tion, the company’s Chief Executive Officer and Chief Finan- The company has a Global Ethics Policy and other poli- cial Officer have concluded that, as of the end of such cies relating to business conduct, that pertain to all employ- period, the company’s disclosure controls and procedures ees, which can be viewed at the company’s website are effective in recording, processing, summarizing, and www.manitowoc.com. The company has adopted a code of reporting, on a timely basis, information required to be dis- ethics that applies to the company’s principal executive closed by the company in the reports that it files or submits officer, principal financial officer, and controller, which is under the Exchange Act, and that such information is accu- part of the company’s Global Ethics Policy and other poli- mulated and communicated to the Chief Executive Officer cies related to business conduct. and Chief Financial Officer, as appropriate, to allow timely discussions regarding required disclosure. ITEM 11. EXECUTIVE COMPENSATION

Management’s Report on Internal Control Over The information required by this item is incorporated by ref- Financial Reporting erence from the sections of the 2010 Proxy Statement cap- The company’s management is responsible for establishing tioned “Compensation of Directors,” “Executive and maintaining adequate internal control over financial report- Compensation,” “Report of the Compensation and Benefits ing, as such term is defined in Exchange Act Rule 13a-15(f). Committee on Executive Compensation,” and “Contingent The company’s management, with the participation of the Employment Agreements.” company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the company’s internal con- ITEM 12. SECURITY OWNERSHIP OF CERTAIN trol over financial reporting based on the framework in Internal BENEFICIAL OWNERS AND MANAGEMENT Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The information required by this item is incorporated by ref- Based on this evaluation, the company’s management has erence from the sections of the 2010 Proxy Statement cap- concluded that, as of December 31, 2009, the company’s tioned “Ownership of Securities” and the subsection internal control over financial reporting was effective. captioned “Equity Compensation Plans.” Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED Also, projections of any evaluation of effectiveness to future TRANSACTIONS, AND DIRECTOR INDEPENDENCE periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the The information required by this item is incorporated by ref- degree of compliance with the policies or procedures may erence from the section of the 2010 Proxy Statement cap- deteriorate. tioned “Governance of the Board and its Committees — The effectiveness of the company’s internal control over Governance of the Company.” financial reporting as of December 31, 2009, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES which appears herein. The information required by this item is incorporated by Changes in Internal Control Over Financial Reporting reference from the section of the 2010 Proxy Statement During the fourth quarter of 2009, the company implemented captioned “Other Information — Independent Public changes to improve internal controls over financial reporting Accountants.” related to calculations of its provision for income taxes. There have been no other changes in our internal control over

98 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, PANTONE Process Blue U, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:08 | 09-35779-2.ea | Sequence: 1 CHKSUM Content: 6945 Layout: 16382 Graphics: No Graphics CLEAN

PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Documents filed as part of this Report. (1) Financial Statements: The following Consolidated Financial Statements are filed as part of this report under Item 8, “Financial Statements and Supplementary Data.”

Report of Independent Registered Public Accounting Firm Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007 Consolidated Balance Sheets as of December 31, 2009 and 2008 Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007 Consolidated Statements of Equity and Comprehensive Income for the years ended December 31, 2009, 2008 and 2007 Notes to Consolidated Financial Statements

(2) Financial Statement Schedules: Financial Statement Schedule for the years ended December 31, 2009, 2008, and 2007

Schedule Description Filed Herewith II Valuation and Qualifying Accounts X

All other financial statement schedules not listed have been omitted since the required information is included in the Consolidated Financial Statements or the Notes thereto, or is not applicable or required under rules of Regulation S-X. (b) Exhibits: See Index to Exhibits immediately following the signature page of this report, which is incorporated herein by reference.

THE MANITOWOC COMPANY, INC AND SUBSIDIARIES Schedule II: Valuation and Qualifying Accounts For The Years Ended December 31, 2007, 2008 and 2009 (dollars in millions)

Balance at Impact of Beginning Acquisition Charge to Foreign Balance at of of Costs and Utilization Exchange End of Year Business Expenses of Reserve Rates Year Year End December 31, 2007 Allowance for doubtful accounts $27.3 $ 0.1 $ 4.4 $ (7.3) $ 1.0 $25.5 Inventory obsolescence reserve $44.4 $ — $12.1 $(15.6) $ 1.7 $42.6 Deferred tax valuation allowance $ 9.7 $ — $ — $ (0.1) $ 0.2 $ 9.8 Year End December 31, 2008 Allowance for doubtful accounts $25.5 $12.6 $ 5.2 $ (6.1) $(0.8) $36.4 Inventory obsolescence reserve $42.6 $24.6 $22.9 $(18.8) $(1.2) $70.1 Deferred tax valuation allowance $ 9.8 $30.5 $ 1.3 $ (1.3) $(0.3) $40.0 Year End December 31, 2009 Allowance for doubtful accounts $36.4 $ 0.1 $26.5 $(16.8) $ 1.1 $47.3 Inventory obsolescence reserve $70.1 $ — $48.0 $(29.3) $ 2.1 $90.9 Deferred tax valuation allowance $40.0 $ (3.5) $26.0 $ (1.0) $10.5 $72.0

The Manitowoc Company, Inc. — 2009 Form 10-K 99

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:08 | 09-35779-2.ea | Sequence: 2 CHKSUM Content: 34002 Layout: 37857 Graphics: No Graphics CLEAN

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: Date: March 1, 2010

The Manitowoc Company, Inc. (Registrant)

/S/ GLEN E. TELLOCK Glen E. Tellock Chairman and Chief Executive Officer

/S/ CARL J. LAURINO Carl J. Laurino Senior Vice President and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons constituting a majority of the Board of Directors on behalf of the registrant and in the capacities and on the dates indicated:

/s/ GLEN E. TELLOCK March 1, 2010 Glen E. Tellock, Chairman and Chief Executive Officer

/s/ CARL J. LAURINO March 1, 2010 Carl J. Laurino, Senior Vice President and Chief Financial Officer

/s/ KEITH D. NOSBUSCH March 1, 2010 Keith D. Nosbusch, Director

/s/ DEAN H. ANDERSON March 1, 2010 Dean H. Anderson, Director

/s/ ROBERT C. STIFT March 1, 2010 Robert C. Stift, Director

/s/ JAMES L. PACKARD March 1, 2010 James L. Packard, Director

/s/ VIRGIS W. C OLBERT March 1, 2010 Virgis W. Colbert, Director

/s/ KENNETH W. K RUEGER March 1, 2010 Kenneth W. Krueger, Director

/s/ CYNTHIA M. EGNOTOVICH March 1, 2010 Cynthia M. Egnotovich, Director

100 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:08 | 09-35779-2.ea | Sequence: 3 CHKSUM Content: 26539 Layout: 36607 Graphics: No Graphics CLEAN

THE MANITOWOC COMPANY, INC. ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2009 INDEX TO EXHIBITS

Filed/Furnished Exhibit No. Description Herewith 1.1 Underwriting Agreement dated February 3, 2010 among The Manitowoc Company, Inc., the Guarantors named therein and the underwriters named therein (filed as Exhibit 1.1 to the company’s Current Report on Form 8-K filed on February 4, 2010 and incorporated herein by reference). 3.1 Amended and Restated Articles of Incorporation, as amended on November 5, 1984, May 5, 1998, March 31, 2006, and July 26, 2007 (filed as Exhibit 99.1 to the company’s Current Report on Form 8-K filed on August 1, 2007 and incorporated herein by reference). 3.2 Restated By-laws (filed as Exhibit 3.2 to the company’s Current Report on Form 8-K filed on May 7, 2007 and incorporated herein by reference). 4.1 Rights Agreement dated March 21, 2007 between the Registrant and Computershare Trust Company, N.A. (filed as Exhibit 4.1 to the company’s Report on Form 8-K dated as of March 21, 2007 and incorporated herein by reference). 4.2(a)* Indenture, dated as of November 6, 2003, by and between The Manitowoc Company, Inc., the Guarantors named therein, and BNY Midwest Trust Company, as Trustee (filed as Exhibit 4.1 to the company’s current Report on Form 8-K dated as of November 6, 2003 and incorporated herein by reference). 4.2(b) Indenture, dated as of February 8, 2010, between The Manitowoc Company, Inc. and Wells Fargo Bank, National Association, a national banking association, as Trustee (filed as Exhibit 4.1 to the company’s Current Report on Form 8-K filed on February 10, 2010 and incorporated herein by reference). 4.2(c) First Supplemental Indenture, dated as of February 8, 2010, among The Manitowoc Company, Inc., the Guarantors named therein, and Wells Fargo Bank, National Association, a national banking association, as Trustee (filed as Exhibit 4.2 to the company’s Current Report on Form 8-K filed on February 10, 2010 and incorporated herein by reference). 4.3 Articles III, V, and VIII of the Amended and Restated Articles of Incorporation (see Exhibit 3.1 above) 4.4 Amended and Restated Credit Agreement dated as of August 25, 2008 by and among The Manitowoc Company, Inc., as Borrower, the Subsidiary Borrowers party thereto, the lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent (filed as Exhibit 4.1 to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2008 and incorporated herein by reference) as amended on December 19, 2008, with such amendment filed as Exhibit 4.6 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and incorporated herein by reference, and as further amended on June 15, 2009, with such amendment filed as Exhibit 4.1 to the company’s Current Report on Form 8-K, dated June 12, 2009 and incorporated herein by reference, and as further amended on January 21, 2010, with such amendment filed as Exhibit 4.1 to the company’s Current Report on Form 8-K, dated January 21, 2010 and incorporated herein by reference. 10.1** The Manitowoc Company, Inc. Deferred Compensation Plan effective August 20, 1993, as amended (filed as Exhibit 10.1 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference) as amended and restated through December 31, 2008, with such Amended and Restated plan filed as exhibit 10.1 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and incorporated herein by reference.

10.2** The Manitowoc Company, Inc. Management Incentive Compensation Plan (Economic Value Added (EVA) Bonus Plan Effective July 4, 1993, as amended (filed as Exhibit 10.2 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002 and incorporated herein by reference). 10.2(a)** Short-Term Incentive Plan, Effective January 1, 2005, as amended on February 27, 2007, effective January 1, 2007 and as further amended on February 15, 2008, effective January 1, 2008 (filed as Exhibit 10.2(a) to the Annual Report on Form 10-K for the fiscal year ended December 31, 2007 and incorporated herein by reference). 10.3(a)** Form of Contingent Employment Agreement between the company and the following executive officers of the Company: Glen E. Tellock, Carl J. Laurino, Maurice D. Jones, Thomas G. Musial, and Dean J. Nolden (filed as Exhibit 10(a) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2000 and incorporated herein by reference).

The Manitowoc Company, Inc. — 2009 Form 10-K 101

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:08 | 09-35779-2.ea | Sequence: 4 CHKSUM Content: 15265 Layout: 38168 Graphics: No Graphics CLEAN

Filed/Furnished Exhibit No. Description Herewith 10.3(b)** Form of Contingent Employment Agreement between the company and the following executive officers of the company and certain other employees of the company: Eric P. Etchart, and Michael Kachmer (filed as Exhibit 10(b) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2000 and incorporated herein by reference). 10.4** Form of Indemnity Agreement between the company and each of the directors, executive officers and certain other employees of the company (filed as Exhibit 10(b) to the company’s Annual Report on Form 10-K for the fiscal year ended July 1, 1989 and incorporated herein by reference). 10.5** Supplemental Retirement Agreement between Fred M. Butler and the company dated March 15, 1993 (filed as Exhibit 10(e) to the company’s Annual Report on Form 10-K for the fiscal year ended July 3, 1993 and incorporated herein by reference). 10.6(a)** Supplemental Retirement Agreement between Robert K. Silva and the company dated January 2, 1995 (filed as Exhibit 10 to the company’s Report on Form 10-Q for the transition period ended December 31. 1994 and incorporated herein by reference). 10.6(b)** Restatement to clarify Mr. Silva’s Supplemental Retirement Agreement dated March 31, 1997 (filed as Exhibit 10.6(b) to the company’s Report on Form 10-K for the fiscal year ended December 31, 1996 and incorporated herein by reference). 10.6(c)** Supplemental Retirement Plan dated May 2000, as amended and restated through December 31, 2008, with such Amended and Restated plan filed as Exhibit 10.6(c) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and incorporated herein by reference. 10.7(a)** The Manitowoc Company, Inc. 1995 Stock Plan, as amended (filed as Exhibit 10.7(a) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002 and incorporated herein by reference). 10.7(b)** The Manitowoc Company, Inc. 1999 Non-Employee Director Stock Option Plan, as amended (filed as Exhibit 10.7(b) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002 and incorporated herein by reference). 10.7(c)** The Manitowoc Company, Inc. 2003 Incentive Stock and Awards Plan, as amended on December 17, 2008, effective January 1, 2005, with such amended plan filed as Exhibit 10.7(c) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and incorporated herein by reference. 10.7(d)** Grove Investors, Inc. 2001 Stock Incentive Plan (filed as Exhibit 99.1 to the company’s Registration Statement on Form S-8, filed on September 13, 2002 (Registration No. 333-99513) and incorporated herein by reference). 10.7(e)** The Manitowoc Company, Inc. 2004 Non-Employee Director Stock and Award Plan, as amended on December 17, 2008, effective January 1, 2005, with such amended plan filed as Exhibit 10.7(e) to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and incorporated herein by reference. 10.8** The Manitowoc Company, Inc. Incentive Stock Option Agreement with Vesting Provisions (filed as Exhibit 10.1 to the company’s Report on Form 8-K dated as of February 25, 2005 and incorporated herein by reference). 10.9** The Manitowoc Company, Inc. Non-Qualified Stock Option Agreement with Vesting Provisions (filed as Exhibit 10.2 to the company’s Report on Form 8-K dated as of February 25, 2005 and incorporated herein by reference). 10.10** The Manitowoc Company, Inc. Award Agreement for Restricted Stock Awards under The Manitowoc Company, Inc. 2003 Incentive Stock and Awards Plan, amended February 27, 2007(filed as Exhibit 10.10 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2004 and incorporated herein by reference). 10.11** The Manitowoc Company, Inc. Award Agreement for the 2004 Non-employee Director Stock and Awards Plan, as amended effective May 3, 2006 and February 27, 2007 (filed as Exhibit 10.11 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 and incorporated herein by reference). 10.12 Amended and Restated Receivable Purchase Agreement among Manitowoc Funding , LLC, as Seller, The Manitowoc Company, Inc., as Servicer, Hannover Funding Company LLC, as Purchaser, and Norddeutsche Landesbank Girozentrale, as Agent, dated as of December 21, 2006 (filed as Exhibit 10.1 to the company’s Current Report on Form 8-K dated as of December 22, 2006 and incorporated herein by reference) as amended on August 15, 2007 with such Amendment No. 1 filed as Exhibit 10.12 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007, and as further amended on November 6, 2008 with such Amendment No. 2 filed as Exhibit 10.12(a) to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2009, and further amended on June 29, 2009 with such Amendment No. 4 filed as Exhibit 10.12 to the company’s Quarterly Report on Form 10-Q for the period ended June 30, 2009, and as further amended on September 28, 2009 with such Amendment No. 5 filed as Exhibit 10.1 to the company’s Current Report on Form 8-K dated as of September 28, 2009, all of which are incorporated herein by reference.

102 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:08 | 09-35779-2.ea | Sequence: 5 CHKSUM Content: 6020 Layout: 27043 Graphics: No Graphics CLEAN

Filed/Furnished Exhibit No. Description Herewith 10.12(a) Amendment No.6 dated December 17, 2009 to the Amended and Restated Receivables Purchase Agreement among X(1) Manitowoc Funding, LLC, as Seller, The Manitowoc Company, Inc., as Servicer, Hannover Funding Company, LLC, as Purchaser, and Norddeutsche Landisbank Girozentrale, as Agent, dated as of December 21, 2006 (filed as Exhibit 10.1 on the company’s Current Report on Form 8-K dated as of December 23, 2006 and incorporated herein by reference) as amended on August 15, 2007 with such Amendment No. 1 filed as Exhibit 10.12 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007, and as further amended on November 6, 2008 with such Amendment No. 2 filed as Exhibit 10.12(a) to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2009, and further amended on June 29, 2009 with such Amendment No. 4 filed as Exhibit 10.12 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2009, and as further amended on September 28, 2009 with such Amendment No. 5 filed as Exhibit 10.1 to the company’s Current Report on Form 8-K dated as of September 28, 2009, all of which are incorporated herein by reference.

10.12(b) Amendment No.7 dated December 31, 2009 to the Amended and Restated Receivables Purchase Agreement among X(1) Manitowoc Funding, LLC, as Seller, The Manitowoc Company, Inc., as Servicer, Hannover Funding Company, LLC, as Purchaser, and Norddeutsche Landisbank Girozentrale, as Agent, dated as of December 21, 2006 (filed as Exhibit 10.1 on the company’s Current Report on Form 8-K dated as of December 23, 2006 and incorporated herein by reference) as amended on August 15, 2007 with such Amendment No. 1 filed as Exhibit 10.12 to the Annual Report on Form 10-K for the fiscal year ended December 31, 2007, and as further amended on November 6, 2008 with such Amendment No. 2 filed as Exhibit 10.12(a) to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2009, and further amended on June 29, 2009 with such Amendment No. 4 filed as Exhibit 10.12 to the company’s Quarterly Report on Form 10-Q for the period ended June 30, 2009, and as further amended on September 28, 2009 with such Amendment No. 5 filed as Exhibit 10.1 to the company’s Current Report on Form 8-K dated as of September 28, 2009 and as further amended on December 17, 2009 with such Amendment No. 6 filed as Exhibit 10.12(a) to this Annual Report on Form 10-K for the fiscal year ended December 31, 2009, all of which are incorporated herein by reference.

10.12(c) Amendment No.8 dated February 26, 2010 to the Amended and Restated Receivables Purchase Agreement among X(1) Manitowoc Funding, LLC, as Seller, The Manitowoc Company, Inc., as Servicer, Hannover Funding Company, LLC, as Purchaser, and Norddeutsche Landisbank Girozentrale, as Agent, dated as of December 21, 2006 (filed as Exhibit 10.1 on the company’s Current Report on Form 8-K dated as of December 23, 2006 and incorporated herein by reference) as amended on August 15, 2007 with such Amendment No. 1 filed as Exhibit 10.12 to the Annual Report on Form 10-K for the fiscal year ended December 31, 2007, and as further amended on November 6, 2008 with such Amendment No. 2 filed as Exhibit 10.12(a) to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2009, and further amended on June 29, 2009 with such Amendment No. 4 filed as Exhibit 10.12 to the company’s Quarterly Report on Form 10-Q for the period ended June 30, 2009, and as further amended on September 28, 2009 with such Amendment No. 5 filed as Exhibit 10.1 to the company’s Current Report on Form 8-K dated as of September 28, 2009 and as further amended on December 17, 2009 with such Amendment No. 6 filed as Exhibit 10.12(a) to this Annual Report on Form 10-K for the fiscal year ended December 31, 2009, all of which are incorporated herein by reference, as further amended on December 31, 2009 with such Amendment No. 7 filed as Exhibit 10.12(b) to this Annual Report on Form 10-K for the fiscal year ended December 31, 2009, all of which are incorporated herein by reference.

10.13 Purchase Agreement, dated as of August 1, 2008, by and among The Manitowoc Company, Inc., MMG Holding Co., LLC, Fincantieri-Cantieri Navali Italiani S.p.A. and Fincantieri Marine Group Holdings Inc. (filed as Exhibit 2.1 to the company’s Report on Form 8-K dated as of August 1, 2008 and incorporated herein by reference). 10.14 Amendment No. 1 to the Purchase Agreement , dated as of December 31, 2008, by and among The Manitowoc Company, Inc., MMG Holding Co., LLC, Fincantieri-Cantieri Navali Italiani S.p.A. and Fincantieri Marine Group Holdings Inc. filed as Exhibit 10.14 to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and incorporated herein by reference.

10.15 The Manitowoc Company, Inc. Severance Pay Plan adopted by the Board of Directors as of May 4, 2009 (filed as Exhibit 10.13 to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2009, and incorporated herein by reference.) 11 Statement regarding computation of basic and diluted earnings per share (see Note 14 to the 2009 Consolidated Financial Statements included herein). 12.1 Statement of Computation of Ratio of Earnings to Fixed Charges X(1) 21 Subsidiaries of The Manitowoc Company, Inc. X(1)

The Manitowoc Company, Inc. — 2009 Form 10-K 103

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Merrill Corp - The Manitowoc Company_ Inc. 10-K FYE 12-31-2009 ED | 105083 | 12-Mar-10 13:08 | 09-35779-2.ea | Sequence: 6 CHKSUM Content: 61691 Layout: 64042 Graphics: No Graphics CLEAN

Filed/Furnished Exhibit No. Description Herewith 23.1 Consent of PricewaterhouseCoopers LLP, the company’s Independent Registered Public Accounting Firm X(1) 31 Rule 13a - 14(a)/15d - 14(a) Certifications X(1) 32.1 Certification of CEO pursuant to 18 U.S.C. Section 1350 X(2) 32.2 Certification of CFO pursuant to 18 U.S.C. Section 1350 X(2)

(1) Filed Herewith (2) Furnished Herewith * Pursuant to Item 601(b)(2) of Regulation S-K, the Registrant agrees to furnish to the Securities and Exchange Commission upon request a copy of any unfiled exhibits or schedules to such documents. ** Management contracts and executive compensation plans and arrangements required to be filed as exhibits pursuant to item 15(c) of Form 10-K.

104 The Manitowoc Company, Inc. — 2009 Form 10-K

JOB: 09-35779-2 CYCLE#;BL#: 2; 0 TRIM: 8.5" x 11" COMPOSITE COLORS: Black, ~note-color 2 GRAPHICS: none V1.5 Financial Highlights Investor Information Manitowoc took decisive actions to reduce costs The Annual Meeting and produce signiﬁ cant of Shareholders will savings in 2009. be held May 4, 2010, in Manitowoc.

$1,000 $2,028 used $1,626

04 05 06 07 08 09 * Environmental impact estimates were made using the Environmental Defense Fund Paper Calculator.

MMN001N001 22009_Cover009_Cover 2 33/19/10/19/10 22:31:36:31:36 AAMM 8:03:02 PM 8:03:02 PM 3/17/103/17/10 Inc. Company, The Manitowoc 2009 Annual Report NCE ALA B ON Manitowoc’s New 31000 Crane Lift Crawler Heavy

The Manitowoc Company, Inc. 2009 Annual Report