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Exhibit 1

Board of Directors, Harnischfeger Corporation, 1984

Director Current Shares

Since
Term
Owned
1981
1985
100

Edward W. Duffy

Chairman of the Board and Chief Executive of United States Gypsum Company, manufacturer of building
materials and products used in industrial processes, since 1983. Former Vice Chairman from 1981 to 1983;
President and Chief Operating Officer from 1971 to 1981. Director American National Bank and Trust
Company of Chicago, Walter E. Heller International Corporation, W. W. Grainger, Inc., and UNR Industries,
Inc. Age 64.

Herbert V. Kohler, Jr.

Chairman, Chief Executive Officer, and Director of Kohler Company, manufacturer of plumbing and specialty
products, engines and generators, since 1972; President since 1974. Age 44.

1973

1985

700

Taisuke Mori

Executive Vice Chairman and Director of Kobe Steel, Ltd., a Japanese manufacturer of steel and steel
products, industrial machinery, construction equipment, aluminum, copper and alloy products, and welding
equipment and consumables. Age 63.

1981

1985

None

William W. Goessel

President and Chief Operating Officer of the Corporation since 1982. Executive Vice President of Beloit
Corporation from 1978, Director to 1982. Goulds Pumps, Inc. Age 56.

1982

1986

15,000

Henry Harnischfeger

Chairman of the Board and Chief Executive Officer of the Corporation since 1970; President from 1959 to
1982. Director, First Wisconsin Corporation and First Wisconsin National Bank of Milwaukee. Age 60.

1945

1986

611,362

Karl F. Nygren

Partner in Kirkland & Ellis, attorneys, since 1959. Age 56.

1964

1986

2,000

John P. Gallagher

Senior lecturer, Graduate School of Business, University of Chicago. Director, IC Industries, Inc., Stone
Container Corporation, UNR Industries, Inc., American National Bank and Trust Company of Chicago, and
Walter E. Heller International Corporation. Age 67.

1979

1987

500

Jeffrey T. Grade

Senior Vice President Finance and Administration and Chief Financial Officer of the Corporation since
August 1, 1983. Vice President Corporate of IC Industries from 1981 to 1983; Assistant Vice President from
1976 to 1981. Age 40.

1983

1987

3,750

Donald Taylor

President, Chief Operating Officer, and Director of Rexnord, Inc., a major manufacturer of industrial
components and machinery, since 1978. Director, Johnson Controls, Inc., Marine Corporation, and Marine
Bank, N.A. Age 56.

1979

1987

100

Frank A. Lee

Director of Foster Wheeler Corporation since 1971; Chairman of the Board from 1981 to 1982; President
and Chief Executive from 1978 to 1981. Director, Belco Pollution Control Corporation, International General
Industries, Inc., and Banker's Life Insurance Co. Age 59.

1983

1987

None

Exhibit 2

Executive Compensation, Harnischfeger Corporation

Cash Compensation
Henry Harnischfeger

Chairman of the Board and Chief Executive Officer

William W. Goessel

President and Chief Operating Officer

280,000

C. P. Cousland

Senior Vice President and group executive, P&H Heavy

Equipment

210,000

Jeffrey T. Grade

Senior Vice President Finance and Administration and

Chief Financial Officer

205,336

Douglas E. Holt

President, Harnischfeger Engineers, Inc.

152,839

All persons who were executive officers during the fiscal year as a
group (14 persons)

$364,004

2,159,066

Exhibit 3

Selected Stock Price and Market Data

A. Stock Prices

Harnischfeger's Stock Price

High
Low
Close

S&P 400 Industrials Index

High
Low
Close

January 4, 1985

9 1/8

7 0/8

186.4

181.8

182.2

January 11, 1985

8 6/8

8 7/8

10 5/8

188.2

182.2

182.8

January 18, 1985

11

10

8 4/8

191.9

186.9

191.3

January 25, 1985

9 0/8

10 1/8

11

199.7

191.3

198.6

February 1, 1985

11 5/8

10 7/8

9 0/8

201.8

198.6

200.0

Harnischfeger's stock beta = 0.95 (Value Line estimate)

Exhibit 3

Selected Stock Price and Market Data

B. Market Data

February 1985
Median P/E ratio of Dow Jones Industrials

10.9

Median P/E ratio of Value Line stocks

11.3

Median P/E ratio of machinery industry (construction and mining equipment)

10.0

Prime rate

10.5%

91-day Treasury bill rate

8.4%

30-year Treasury bond yield

11.4%

Moody's Aaa corporate bond yield

12.0%

Consolidated Statement of Operations

(Dollar amounts in thousands except per share figures)

Year Ended October 31

1984
1983
1982
Revenues
Net sales
Other income, including license and technical service
fees

$398,708 $321,010 $447,461

7,067

3,111

5,209

405,775
315,216

324,121
261,384

452,670
366,297

Operating Income

90,559

62,737

86,373

Less:
Product development, selling and administrative
expenses
Interest expense - net
Provision for plant closing

72,196
12,625

85,795
9,745

113,457
18,873
23,700

Income (Loss) before provision (credit) for income taxes,

equity items and cumulative effect of accounting change

5,738

(32,803)

(69,657)

Provision (Credit) for income taxes

2,425

(1,400)

(1,600)

Income (Loss) before equity items and cumulative effect of

accounting change

3,313

(31,403)

(68,057)

993

(3,397)

(7,891)

Minority interest in (earnings) loss of consolidated

subsidiaries

(135)

170

(583)

Income (loss) before cumulative effect of accounting

change

4,171

(34,630)

(76,531)

Cumulative effect of change in depreciation method

11,005

Cost of sales

Equity items
Equity in earnings (loss) of unconsolidated companies

Net income (loss)

$15,176

($34,630) ($76,531)

Earnings (loss) per common and common equivalent

share:
Income (loss) before cumulative effect of accounting
change

$0.35

($3.49)

($7.64)

Cumulative effect of change in depreciation method

Net income (loss)

0.93

$1.28

($3.49)

($7.64)

Pro forma amounts assuming the changed depreciation

method had been applied respectively:
Net (loss)
(Loss) per common share

($33,918) ($76,695)
($3.42)

($7.65)

CONSOLIDATED BALANCE SHEET

(Dollar amounts in thousands except per share figures)

October 31,
1984
1983
Assets
Current Assets
Cash and temporary investments
Accounts receivable
Inventories
Refundable income taxes and related interest
Other current assets
Prepaid income taxes
Investments and Other Assets
Investments in and advances to:
Finance subsidiary, at equity in net assets
Other companies
Other assets
Operating Plants
Land and improvements
Buildings
Machinery and equipment
Accumulated depreciation

$96,007
87,648
144,312
1,296
5,502
14,494
349,259

$64,275
63,740
153,594
12,585
6,023
14,232
314,449

8,849
4,445
13,959
27,253

6,704
2,514
6,411
15,629

9,419
59,083
120,949
189,451
(93,259)
96,192
$472,704

10,370
60,377
122,154
192,901
(107,577)
85,324
$415,402

$9,090
973
37,716
15,041
2,460
20,619
1,645
-29,673
117,217

$8,155
18,265
21,228
14,343
6,348
15,886
3,463
3,436
32,333
123,457

128,550
-7,870
136,420

139,092
5,400
8,120
152,612

57,611
5,299
6,385

19,098
7,777
134

Liabilities and Shareholders' Equity

Current Liabilities
Short-term notes payable to banks by subsidiaries
Long-term debt and capitalized lease obligations payable within one year
Trade accounts payable
Employee compensation and benefits
Accrued plant closing costs
Advance payments and progress billings
Income taxes payable
Account payable to finance subsidiary
Other current liabilities and accruals
Long-Term Obligations
Long-term debt payable to:
Unaffiliated lenders
Finance subsidiary
Capitalized lease obligations
Deferred Liabilities and Income Taxes
Accrued pension costs
Other deferred liabilities
Deferred income taxes

Minority Interest
Shareholders' equity
Preferred stock $100 par value --authorized 250,000 shares:
Series A $7.00 cumulative convertible preferred shares: authorized, issued and
outstanding 117,500 shares in 1984 and 100,000 shares in 1983
Common stock, $1 par value -- authorized 25,000,000 shares: issued and
outstanding 12,283,563 shares in 1984 and 10,133,563 shares in 1983
Capital in excess of par value of shares
Retained earnings
Cumulative translation adjustments

69,295
2,400

27,009
2,405

11,750

10,000

12,284

10,134

114,333
19,901
(10,896)
147,372
$472,704

88,332
6,475
(5,022)
109,919
$415,402

CONSOLIDATED STATEMENT OF CHANGES IN FINANCIAL POSITION

(Dollar amounts in thousands)

Year Ended October 31,

1984
1983
1982
Funds Were Provided by (Applied to):
Operations:
Income (loss) before cumulative effect of accounting change
Cumulative effect of change in depreciation method
Net income (loss)
Add (deduct) -Items included not affecting funds:
Depreciation
Unremitted (earnings) loss of unconsolidated companies
Deferred pension contributions
Deferred income taxes
Reduction in accumulated depreciation resulting from change in depreciation
method
Other -- net
Decrease in operating working capital (see below)
Add (deduct) the effects on operating working capital of:
Conversion of export and factored receivable sales to debt
Reclassification to deferred liabilities:
Accrued pension costs
Other liabilities
Foreign currency translation adjustments
Funds provided by operations
Financing, Investment and Other Activities:
Transactions in debt and capitalized lease obligations- Long-Term debt and
capitalized lease obligations: Proceeds from sale of 15% Senior Notes and 12%
subordinated debentures, net of issue costs
Other increases

$4,171
11,005
15,176

($34,630)
-(34,630)

($76,531)
-(76,531)

8,077
(993)
(500)
6,583

13,552
3,397
4,834
(3,178)

15,241
7,891
-1,406

(17,205)

--

--

(2,168)
7,039

(67)
11,605

2,034
72,172

--

23,919

--

--(6,009)
10,000

14,264
5,510
(1,919)
37,287

---

120,530
1,474

---

(5,943)
16,270

-25,698

Repayments
Restructured debt
Debt replaced, including conversion of receivable sales of $23,919, and
short-term bank notes payable of $9,028
Net increase (repayment) in short-term bank notes payable
Net increase (repayment) in debt and capitalized lease obligations
Issuance of:
Common stock
Common stock purchase warrants
Salaried pension assets reversion
Plant and equipment additions
Advances to unconsolidated companies
Other -- net
Funds provided by (applied to) financing, investment and other activities
Increase in cash and temporary investments
Cash Dividends
Increase in Cash and Temporary Investments
Decrease (increase) in operating working capital (excluding cash items, debt and
capitalized lease obligations):
Accounts receivable
Inventories
Refundable income taxes and related interest
Other current assets
Trade accounts payable
Employee compensation and benefits
Accrued plant closing costs
Other current liabilities
Decrease in operating working capital

(161,500)
--(39,496)
2,107
(37,389)

(760)
158,058

(9,409)
--

(158,058)
(760)
(3,982)
(4,742)

-16,289
(2,016)
14,273

----1,531

449
--(10,819)
-848

21,732
$31,732
-$31,732

(5,082)
$32,205
-$32,205

4,751
$21,021
(2,369)
$18,652

($23,908)
9,282
11,289
259
16,488
698
(3,888)
(3,181)
$7,039

($5,327)
56,904
(2,584)
10,008
(1,757)
(15,564)
(14,148)
(15,927)
$11,605

$42,293
26,124
(6,268)
(439)
(3,302)
(3,702)
20,496
(3,030)
$72,172

21,310
6,663
39,307
(5,546)
(2,882)
269

(1,871)

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

(Dollar amounts in thousands except per share figures)

Capital in
Excess of
Cumulative
Preferred Common Par Value Retained Translation
Stock
Stock
of Shares Earnings Adjustments

Balance at October 31, 1981

Cumulative translation adjustments
through October 31, 1981
Issuance of Common Stock: 10,000
shares to Kobe Steel, Ltd.
38,161 shares under stock purchase
and dividend reinvestment plans
Net (loss)
Cash dividends paid on:
Preferred stock
Common stock $.20 per share
Translation adjustments, net of deferred
income taxes of $128
Balance at October 31, 1982
Net (loss)
Translation adjustments, including
deferred income taxes of $33
Balance at October 31, 1983
Issuance of:
2,150,00 shares of common stock
2,000,000 common stock purchase
warrants

$10,000

$10,085

$87,932 $120,005

Total

$ --- $228,022
($1,195)

($1,195)

10

91

101

39

309
(76,531)

348
(76,531)

(350)
(2,019)

(350)
(2,019)
(2,928)
(4,123)

(2,928)
145,448
(34,630)

(899)
(5,022)

(899)
109,919

10,000

10,134

88,332

41,105
(34,630)

10,000

10,134

88,332

6,475

2,150

19,160

21,310

6,663

6,663

17,500 shares of Series A $7.00

cumulative convertible preferred stock
in discharge of dividends payable on
preferred stock
Net income
Translation adjustments, net of
deferred income taxes of $300
Other
Balance at October 31, 1984

1,750

(1,750)
15,176

--15,176
(5,874)

178
$11,750

$12,284

$114,333

$19,901

(5,874)
178

($10,896) $147,372