Separate Financial Information of Guarantor Subsidiaries (Notes)

9 Months Ended

12 Months Ended

Sep. 30, 2017

Dec. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Separate Financial Information of Guarantor Subsidiaries

The following condensed consolidating guarantor financial information is presented to comply with the requirements of Rule 3-10 of Regulation S-X.

On April 18, 2017, we issued and sold $300,000 in aggregate principal amount of our 5.625% Senior Notes due 2025 (the “Notes”), pursuant to an Indenture, dated as of April 18, 2017, among the company, the Guarantors (as defined below), and Wells Fargo Bank, National Association, a national banking association, as trustee. The Notes are unconditionally and jointly and severally guaranteed by Tennant Coatings, Inc. and Tennant Sales and Service Company (collectively, the “Guarantors”), which are wholly owned subsidiaries of the company.

The Notes and the guarantees constitute senior unsecured obligations of the company and the Guarantors, respectively. The Notes and the guarantees, respectively, are: (a) equal in right of payment with all of the company’s and the Guarantors’ senior debt, without giving effect to collateral arrangements; (b) senior in right of payment to all of the company’s and the Guarantors’ future subordinated debt, if any; (c) effectively subordinated in right of payment to all of the company’s and the Guarantors’ debt and obligations that are secured, including borrowings under the company’s senior secured credit facilities for so long as the senior secured credit facilities are secured, to the extent of the value of the assets securing such liens; and (d) structurally subordinated in right of payment to all liabilities (including trade payables) of the company’s and the Guarantors’ subsidiaries that do not guarantee the Notes.

The following condensed consolidated financial information presents the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Comprehensive Income for each of the three and nine months ended September 30, 2017 and September 30, 2016, the related Condensed Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016, and the related Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and September 30, 2016, of Tennant Company ("Parent"), the Guarantor Subsidiaries on a combined basis, the Non-Guarantor Subsidiaries on a combined basis and elimination entries necessary to consolidated the Parent with the Guarantor and Non-Guarantor Subsidiaries. The following condensed consolidated financial statements should be read in conjunction with the consolidated financial statements of the company and notes thereto of which this note is an integral part.



Condensed Consolidated Statement of Operations
For the nine months ended September 30, 2017
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Sales	$	337,034		$	442,090		$	331,491		$	(386,844	)	$	723,771
Cost of Sales	230,753			363,034			228,838			(387,748		)	434,877
Gross Profit	106,281			79,056			102,653			904			288,894

Operating Expense:
Research and Development Expense	20,838			245			3,156			—			24,239
Selling and Administrative Expense	85,608			58,881			102,578			—			247,067
Total Operating Expense	106,446			59,126			105,734			—			271,306
(Loss) Profit from Operations	(165		)	19,930			(3,081		)	904			17,588

Other Income (Expense):
Equity in Earnings of Affiliates	7,493			1,500			—			(8,993		)	—
Interest Expense, Net	(16,866		)	—			(257		)	(22		)	(17,145		)
Intercompany Interest Income (Expense)	8,742			(4,323		)	(4,419		)	—			—
Net Foreign Currency Transaction Gains (Losses)	553			—			(2,928		)	—			(2,375		)
Other (Expense) Income, Net	(2,389		)	(430		)	2,177			(58		)	(700		)
Total Other Expense, Net	(2,467		)	(3,253		)	(5,427		)	(9,073		)	(20,220		)

(Loss) Profit Before Income Taxes	(2,632		)	16,677			(8,508		)	(8,169		)	(2,632		)
Income Tax Expense	385			5,993			5,481			(11,474		)	385
Net Earnings (Loss) Including Noncontrolling Interest	(3,017		)	10,684			(13,989		)	3,305			(3,017		)
Net Loss Attributable to Noncontrolling Interest	(28		)	—			(28		)	28			(28		)
Net (Loss) Earnings Attributable to Tennant Company	$	(2,989	)	$	10,684		$	(13,961	)	$	3,277		$	(2,989	)



Condensed Consolidated Statement of Operations
For the three months ended September 30, 2017
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Sales	$	111,835		$	146,495		$	131,457		$	(127,866	)	$	261,921
Cost of Sales	76,974			120,523			88,411			(128,591		)	157,317
Gross Profit	34,861			25,972			43,046			725			104,604

Operating Expense:
Research and Development Expense	6,312			86			1,509			—			7,907
Selling and Administrative Expense	23,393			19,074			43,184			—			85,651
Total Operating Expense	29,705			19,160			44,693			—			93,558
Profit (Loss) from Operations	5,156			6,812			(1,647		)	725			11,046

Other Income (Expense):
Equity in Earnings of Affiliates	2,039			376			—			(2,415		)	—
Interest Expense, Net	(5,275		)	—			(111		)	(9		)	(5,395		)
Intercompany Interest Income (Expense)	3,774			(1,455		)	(2,319		)	—			—
Net Foreign Currency Transaction Gains (Losses)	357			2			(1,201		)	—			(842		)
Other (Expense) Income, Net	(1,724		)	(204		)	1,469			(23		)	(482		)
Total Other Expense, Net	(829		)	(1,281		)	(2,162		)	(2,447		)	(6,719		)

Profit (Loss) Before Income Taxes	4,327			5,531			(3,809		)	(1,722		)	4,327
Income Tax Expense	731			2,034			2,819			(4,853		)	731
Net Earnings (Loss) Including Noncontrolling Interest	3,596			3,497			(6,628		)	3,131			3,596
Net Earnings Attributable to Noncontrolling Interest	37			—			37			(37		)	37
Net Earnings (Loss) Attributable to Tennant Company	$	3,559		$	3,497		$	(6,665	)	$	3,168		$	3,559



Condensed Consolidated Statement of Operations
For the nine months ended September 30, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Sales	$	340,344		$	436,046		$	212,143		$	(391,707	)	$	596,826
Cost of Sales	225,253			356,862			148,362			(391,737		)	338,740
Gross Profit	115,091			79,184			63,781			30			258,086

Operating Expense:
Research and Development Expense	22,907			334			1,471			—			24,712
Selling and Administrative Expense	72,925			56,475			57,915			—			187,315
(Gain) Loss on Sale of Business	(220		)	—			369			—			149
Total Operating Expense	95,612			56,809			59,755			—			212,176
Profit from Operations	19,479			22,375			4,026			30			45,910

Other Income (Expense):
Equity in Earnings of Affiliates	21,360			1,461			—			(22,821		)	—
Interest (Expense) Income, Net	(880		)	—			149			—			(731		)
Intercompany Interest Income (Expense)	5,355			(4,039		)	(1,316		)	—			—
Net Foreign Currency Transaction Gains (Losses)	1,003			(667		)	(161		)	—			175
Other (Expense) Income, Net	(1,323		)	(450		)	1,413			—			(360		)
Total Other Income (Expense), Net	25,515			(3,695		)	85			(22,821		)	(916		)

Profit Before Income Taxes	44,994			18,680			4,111			(22,791		)	44,994
Income Tax Expense	13,750			6,883			1,408			(8,291		)	13,750
Net Earnings	$	31,244		$	11,797		$	2,703		$	(14,500	)	$	31,244



Condensed Consolidated Statement of Operations
For the three months ended September 30, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Sales	$	115,130		$	147,035		$	69,531		$	(131,562	)	$	200,134
Cost of Sales	77,478			120,603			48,327			(131,569		)	114,839
Gross Profit	37,652			26,432			21,204			7			85,295

Operating Expense:
Research and Development Expense	7,832			69			517			—			8,418
Selling and Administrative Expense	22,680			18,623			19,320			—			60,623
Total Operating Expense	30,512			18,692			19,837			—			69,041
Profit from Operations	7,140			7,740			1,367			7			16,254

Other Income (Expense):
Equity in Earnings of Affiliates	7,335			144			—			(7,479		)	—
Interest (Expense) Income, Net	(313		)	—			91			—			(222		)
Intercompany Interest Income (Expense)	1,787			(1,361		)	(426		)	—			—
Net Foreign Currency Transaction Gains (Losses)	246			(50		)	(345		)	—			(149		)
Other (Expense) Income, Net	(322		)	(146		)	458			—			(10		)
Total Other Income (Expense), Net	8,733			(1,413		)	(222		)	(7,479		)	(381		)

Profit Before Income Taxes	15,873			6,327			1,145			(7,472		)	15,873
Income Tax Expense	4,396			2,321			261			(2,582		)	4,396
Net Earnings	$	11,477		$	4,006		$	884		$	(4,890	)	$	11,477



Condensed Consolidated Statement of Comprehensive Income
For the nine months ended September 30, 2017
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Earnings (Loss) Including Noncontrolling Interest	$	(3,017	)	$	10,684	$	(13,989	)	$	3,305		$	(3,017	)
Other Comprehensive Income (Loss):
Foreign currency translation adjustments	25,073			693		1,330			(2,023		)	25,073
Pension and retiree medical benefits	541			—		151			(151		)	541
Cash flow hedge	(6,311		)	—		—			—			(6,311		)
Income Taxes:
Foreign currency translation adjustments	—			—		—			—			—
Pension and retiree medical benefits	(160		)	—		(15		)	15			(160		)
Cash flow hedge	2,354			—		—			—			2,354
Total Other Comprehensive Income, net of tax	21,497			693		1,466			(2,159		)	21,497

Total Comprehensive Income (Loss) Including Noncontrolling Interest	18,480			11,377		(12,523		)	1,146			18,480
Comprehensive Loss Attributable to Noncontrolling Interest	(28		)	—		(28		)	28			(28		)
Comprehensive Income (Loss) Attributable to Tennant Company	$	18,508		$	11,377	$	(12,495	)	$	1,118		$	18,508



Condensed Consolidated Statement of Comprehensive Income
For the three months ended September 30, 2017
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Earnings (Loss) Including Noncontrolling Interest	$	3,596		$	3,497	$	(6,628	)	$	3,131		$	3,596
Other Comprehensive Income (Loss):
Foreign currency translation adjustments	9,033			289		9,221			(9,510		)	9,033
Pension and retiree medical benefits	379			—		10			(10		)	379
Cash flow hedge	(1,732		)	—		—			—			(1,732		)
Income Taxes:
Foreign currency translation adjustments	—			—		—			—			—
Pension and retiree medical benefits	(138		)	—		—			—			(138		)
Cash flow hedge	646			—		—			—			646
Total Other Comprehensive Income, net of tax	8,188			289		9,231			(9,520		)	8,188

Total Comprehensive Income Including Noncontrolling Interest	11,784			3,786		2,603			(6,389		)	11,784
Comprehensive Income Attributable to Noncontrolling Interest	37			—		37			(37		)	37
Comprehensive Income Attributable to Tennant Company	$	11,747		$	3,786	$	2,566		$	(6,352	)	$	11,747



Condensed Consolidated Statement of Comprehensive Income
For the nine months ended September 30, 2016
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total Tennant Company
Net Earnings (Loss)	$	31,244		$	11,797	$	2,703	$	(14,500	)	$	31,244
Other Comprehensive Income (Loss):
Foreign currency translation adjustments	4,380			650		7,496		(8,146		)	4,380
Pension and retiree medical benefits	61			—		—		—			61
Cash flow hedge	(394		)	—		—		—			(394		)
Income Taxes:
Foreign currency translation adjustments	15			—		15		(15		)	15
Pension and retiree medical benefits	(23		)	—		—		—			(23		)
Cash flow hedge	147			—		—		—			147
Total Other Comprehensive (Loss) Income, net of tax	4,186			650		7,511		(8,161		)	4,186
Comprehensive Income (Loss)	$	35,430		$	12,447	$	10,214	$	(22,661	)	$	35,430



Condensed Consolidated Statement of Comprehensive Income
For the three months ended September 30, 2016
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total Tennant Company
Net Earnings (Loss)	$	11,477		$	4,006	$	884	$	(4,890	)	$	11,477
Other Comprehensive Income (Loss):
Foreign currency translation adjustments	381			43		764		(807		)	381
Pension and retiree medical benefits	23			—		—		—			23
Cash flow hedge	35			—		—		—			35
Income Taxes:
Foreign currency translation adjustments	10			—		10		(10		)	10
Pension and retiree medical benefits	(9		)	—		—		—			(9		)
Cash flow hedge	(13		)	—		—		—			(13		)
Total Other Comprehensive (Loss) Income, net of tax	427			43		774		(817		)	427
Comprehensive Income (Loss)	$	11,904		$	4,049	$	1,658	$	(5,707	)	$	11,904



Condensed Consolidated Balance Sheet
As of September 30, 2017
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
ASSETS
Current Assets:
Cash and Cash Equivalents	$	10,171		$	1,024		$	44,752		$	—		$	55,947
Restricted Cash	—			—			1,292			—			1,292
Net Receivables	194			79,978			113,553			—			193,725
Intercompany Receivables	71,221			129,405			4,013			(204,639		)	—
Inventories	32,929			15,219			103,829			(10,458		)	141,519
Prepaid Expenses	17,884			813			7,584			—			26,281
Other Current Assets	4,367			—			542			—			4,909
Total Current Assets	136,766			226,439			275,565			(215,097		)	423,673
Property, Plant and Equipment	233,464			13,013			142,914			—			389,391
Accumulated Depreciation	(153,364		)	(6,891		)	(47,627		)	—			(207,882		)
Property, Plant and Equipment, Net	80,100			6,122			95,287			—			181,509
Deferred Income Taxes	3,356			3,974			12,527			—			19,857
Investment in Affiliates	374,353			10,978			—			(385,331		)	—
Intercompany Loans	307,090			—			—			(307,090		)	—
Goodwill	12,869			1,739			164,440			—			179,048
Intangible Assets, Net	2,237			2,951			170,564			—			175,752
Other Assets	13,255			—			9,704			—			22,959
Total Assets	$	930,026		$	252,203		$	728,087		$	(907,518	)	$	1,002,798
LIABILITIES AND TOTAL EQUITY
Current Liabilities:
Current Portion of Long-Term Debt	$	4,887		$	—		$	394		$	—		$	5,281
Accounts Payable	36,777			2,557			49,284			—			88,618
Intercompany Payables	134,053			130			70,456			(204,639		)	—
Employee Compensation and Benefits	8,538			9,457			17,090			—			35,085
Income Taxes Payable	426			—			10,173			—			10,599
Other Current Liabilities	25,517			14,022			23,788			—			63,327
Total Current Liabilities	210,198			26,166			171,185			(204,639		)	202,910
Long-Term Liabilities:
Long-Term Debt	382,975			—			277			—			383,252
Intercompany Loans	—			128,000			179,090			(307,090		)	—
Employee-Related Benefits	12,329			3,775			9,143			—			25,247
Deferred Income Taxes	—			—			62,167			—			62,167
Other Liabilities	27,988			1,843			2,855			—			32,686
Total Long-Term Liabilities	423,292			133,618			253,532			(307,090		)	503,352
Total Liabilities	633,490			159,784			424,717			(511,729		)	706,262
Equity:
Preferred Stock	—			—			—			—			—
Common Stock	6,690			—			11,131			(11,131		)	6,690
Additional Paid-In Capital	12,062			72,483			352,262			(424,745		)	12,062
Retained Earnings	303,987			20,458			(46,147		)	25,689			303,987
Accumulated Other Comprehensive Loss	(28,426		)	(522		)	(16,099		)	16,621			(28,426		)
Total Tennant Company Shareholders' Equity	294,313			92,419			301,147			(393,566		)	294,313
Noncontrolling Interest	2,223			—			2,223			(2,223		)	2,223
Total Equity	296,536			92,419			303,370			(395,789		)	296,536
Total Liabilities and Total Equity	$	930,026		$	252,203		$	728,087		$	(907,518	)	$	1,002,798



Condensed Consolidated Balance Sheet
As of December 31, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
ASSETS
Current Assets:
Cash and Cash Equivalents	$	38,484		$	226		$	19,323		$	—		$	58,033
Restricted Cash	—			—			517			—			517
Net Receivables	209			85,219			63,706			—			149,134
Intercompany Receivables	50,437			123,289			2,251			(175,977		)	—
Inventories	26,422			12,821			49,829			(10,450		)	78,622
Prepaid Expenses	4,120			1,151			3,933			—			9,204
Other Current Assets	2,402			—			10			—			2,412
Total Current Assets	122,074			222,706			139,569			(186,427		)	297,922
Property, Plant and Equipment	225,651			12,996			59,853			—			298,500
Accumulated Depreciation	(144,281		)	(6,175		)	(35,947		)	—			(186,403		)
Property, Plant and Equipment, Net	81,370			6,821			23,906			—			112,097
Deferred Income Taxes	3,048			3,281			7,110			—			13,439
Investment in Affiliates	157,004			9,021			—			(166,025		)	—
Intercompany Loans	130,000			—			—			(130,000		)	—
Goodwill	12,869			1,439			6,757			—			21,065
Intangible Assets, Net	—			3,200			3,260			—			6,460
Other Assets	10,189			27			8,838			—			19,054
Total Assets	$	516,554		$	246,495		$	189,440		$	(482,452	)	$	470,037
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current Portion of Long-Term Debt	$	3,429		$	—		$	30		$	—		$	3,459
Accounts Payable	30,867			2,599			13,942			—			47,408
Intercompany Payables	125,540			1,249			49,188			(175,977		)	—
Employee Compensation and Benefits	12,025			15,261			8,711			—			35,997
Income Taxes Payable	1,410			—			938			—			2,348
Other Current Liabilities	15,329			13,348			14,940			—			43,617
Total Current Liabilities	188,600			32,457			87,749			(175,977		)	132,829
Long-Term Liabilities:
Long-Term Debt	32,714			—			21			—			32,735
Intercompany Loans	—			128,000			2,000			(130,000		)	—
Employee-Related Benefits	14,291			3,704			3,139			—			21,134
Deferred Income Taxes	—			—			171			—			171
Other Liabilities	2,406			1,295			924			—			4,625
Total Long-Term Liabilities	49,411			132,999			6,255			(130,000		)	58,665
Total Liabilities	238,011			165,456			94,004			(305,977		)	191,494
Shareholders' Equity:
Preferred Stock	—			—			—			—			—
Common Stock	6,633			—			11,131			(11,131		)	6,633
Additional Paid-In Capital	3,653			72,483			158,592			(231,075		)	3,653
Retained Earnings	318,180			9,771			(32,187		)	22,416			318,180
Accumulated Other Comprehensive Loss	(49,923		)	(1,215		)	(42,100		)	43,315			(49,923		)
Total Shareholders' Equity	278,543			81,039			95,436			(176,475		)	278,543
Total Liabilities and Shareholders' Equity	$	516,554		$	246,495		$	189,440		$	(482,452	)	$	470,037



Condensed Consolidated Statement of Cash Flows
For the nine months ended September 30, 2017
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
OPERATING ACTIVITIES
Net Cash (Used in) Provided by Operating Activities	$	(555	)	$	798	$	31,880		$	—		$	32,123
INVESTING ACTIVITIES
Purchases of Property, Plant and Equipment	(7,400		)	—		(8,839		)	—			(16,239		)
Proceeds from Disposals of Property, Plant and Equipment	17			—		2,439			—			2,456
Proceeds from Principal Payments Received on Long-Term Note Receivable	—			—		500			—			500
Issuance of Long-Term Note Receivable	—			—		(1,500		)	—			(1,500		)
Acquisition of Businesses, Net of Cash Acquired	(304		)	—		(353,769		)	—			(354,073		)
Purchase of Intangible Asset	(2,500		)	—		—			—			(2,500		)
Change in Investments in Subsidiaries	(193,639		)	—		—			193,639			—
Loan (Payments) Borrowings from Subsidiaries	(159,780		)	—		—			159,780			—
Increase in Restricted Cash	—			—		(133		)	—			(133		)
Net Cash (Used in) Provided by Investing Activities	(363,606		)	—		(361,302		)	353,419			(371,489		)
FINANCING ACTIVITIES
Proceeds from Short-Term Debt	300,000			—		—			—			300,000
Repayments of Short-Term Debt	(300,000		)	—		—			—			(300,000		)
Loan Borrowings (Payments) from Parent	—			—		159,780			(159,780		)	—
Change in Subsidiary Equity	—			—		193,639			(193,639		)	—
Proceeds from Issuance of Long-Term Debt	440,000			—		—			—			440,000
Payments of Long-Term Debt	(81,143		)	—		(119		)	—			(81,262		)
Payments of Debt Issuance Costs	(16,465		)	—		—			—			(16,465		)
Proceeds from Issuances of Common Stock	4,728			—		—			—			4,728
Dividends Paid	(11,204		)	—		—			—			(11,204		)
Net Cash Provided by Financing Activities	335,916			—		353,300			(353,419		)	335,797
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(68		)	—		1,551			—			1,483
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(28,313		)	798		25,429			—			(2,086		)
Cash and Cash Equivalents at Beginning of Year	38,484			226		19,323			—			58,033
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	10,171		$	1,024	$	44,752		$	—		$	55,947



Condensed Consolidated Statement of Cash Flows
For the nine months ended September 30, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
OPERATING ACTIVITIES
Net Cash Provided by Operating Activities	$	22,414		$	473		$	10,395		$	—		$	33,282
INVESTING ACTIVITIES
Purchases of Property, Plant and Equipment	(18,652		)	(13		)	(3,834		)	—			(22,499		)
Proceeds from Disposals of Property, Plant and Equipment	316			—			243			—			559
Acquisition of Businesses, Net of Cash Acquired	—			(10,964		)	(1,394		)	—			(12,358		)
Proceeds from Sale of Business	—			—			285			—			285
Change in Investments in Subsidiaries	(3,000		)	—			—			3,000			—
Loan (Payments) Borrowings from Subsidiaries	(7,964		)	—			—			7,964			—
Decrease in Restricted Cash	—			—			116			—			116
Net Cash Used in Investing Activities	(29,300		)	(10,977		)	(4,584		)	10,964			(33,897		)
FINANCING ACTIVITIES
Loan Borrowings (Payments) from Parent	—			7,964			—			(7,964		)	—
Change in Subsidiary Equity	—			3,000			—			(3,000		)	—
Proceeds from Issuance of Long-Term Debt	15,000			—			—			—			15,000
Payments of Long-Term Debt	(3,429		)	—			(23		)	—			(3,452		)
Purchases of Common Stock	(12,762		)	—			—			—			(12,762		)
Proceeds from Issuances of Common Stock	2,893			—			—			—			2,893
Excess Tax Benefit on Stock Plans	447			—			—			—			447
Dividends Paid	(10,583		)	—			—			—			(10,583		)
Net Cash (Used in) Provided by Financing Activities	(8,434		)	10,964			(23		)	(10,964		)	(8,457		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(298		)	—			353			—			55
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(15,618		)	460			6,141			—			(9,017		)
Cash and Cash Equivalents at Beginning of Year	35,834			—			15,466			—			51,300
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	20,216		$	460		$	21,607		$	—		$	42,283

Separate Financial Information of Guarantor Subsidiaries

The following condensed consolidating guarantor financial information is presented to comply with the requirements of Rule 3-10 of Regulation S-X.

The following condensed consolidating financial information presents the Condensed Consolidated Statements of Earnings, Comprehensive Income and Cash Flows for each of the years in the three-year period ended December 31, 2016, and the related Condensed Consolidated Balance Sheets as of December 31, 2016 and 2015, of Tennant Company ("Parent"), the Guarantor Subsidiaries on a combined basis, the Non-Guarantor Subsidiaries on a combined basis and elimination entries necessary to consolidated the Parent with the Guarantor and Non-Guarantor Subsidiaries. The following condensed consolidated financial statements should be read in conjunction with the consolidated financial statements of the company and notes thereto of which this note is an integral part.



Condensed Consolidated Statement of Earnings
For the year ended December 31, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Sales	$	455,375		$	587,815		$	290,349		$	(524,967	)	$	808,572
Cost of Sales	299,459			483,075			199,336			(524,893		)	456,977
Gross Profit	155,916			104,740			91,013			(74		)	351,595
Operating Expense:
Research and Development Expense	32,378			429			1,931			—			34,738
Selling and Administrative Expense	95,189			74,643			78,378			—			248,210
(Gain) Loss on Sale of Business	(82		)	—			231			—			149
Total Operating Expense	127,485			75,072			80,540			—			283,097
Profit from Operations	28,431			29,668			10,473			(74		)	68,498
Other Income (Expense):
Equity in Earnings of Affiliates	34,068			2,192			—			(36,260		)	—
Interest (Expense) Income, Net	(1,204		)	—			255			—			(949		)
Intercompany Interest Income (Expense)	7,157			(5,570		)	(1,587		)	—			—
Net Foreign Currency Transaction Gains (Losses)	648			(652		)	(388		)	—			(392		)
Other (Expense) Income, Net	(2,609		)	(573		)	2,516			—			(666		)
Total Other Income (Expense), Net	38,060			(4,603		)	796			(36,260		)	(2,007		)
Profit Before Income Taxes	66,491			25,065			11,269			(36,334		)	66,491
Income Tax Expense	19,877			9,443			2,427			(11,870		)	19,877
Net Earnings	$	46,614		$	15,622		$	8,842		$	(24,464	)	$	46,614



Condensed Consolidated Statement of Earnings
For the year ended December 31, 2015
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations				Total Tennant Company
Net Sales	$	480,418		$	586,154		$	306,506		$	(561,279	)		$	811,799
Cost of Sales	320,620			489,203			213,085			(560,169		)		462,739
Gross Profit	159,798			96,951			93,421			(1,110		)		349,060
Operating Expense:
Research and Development Expense	29,888			389			2,138			—				32,415
Selling and Administrative Expense	97,301			72,954			82,015			—			—	252,270
Impairment of Long-Lived Assets	—			—			11,199			—				11,199
Total Operating Expense	127,189			73,343			95,352			—				295,884
Profit (Loss) from Operations	32,609			23,608			(1,931		)	(1,110		)		53,176
Other Income (Expense):
Equity in Earnings of Affiliates	14,766			2,122			—			(16,888		)		—
Interest (Expense) Income, Net	(1,221		)	—			80			—				(1,141		)
Intercompany Interest Income (Expense)	7,368			(5,400		)	(1,968		)	—				—
Net Foreign Currency Transaction Gains (Losses)	535			(777		)	(712		)	—				(954		)
Other (Expense) Income, Net	(3,633		)	(422		)	3,398			—				(657		)
Total Other Income (Expense), Net	17,815			(4,477		)	798			(16,888		)		(2,752		)
Profit (Loss) Before Income Taxes	50,424			19,131			(1,133		)	(17,998		)		50,424
Income Tax Expense	18,336			4,619			1,630			(6,249		)		18,336
Net Earnings (Loss)	$	32,088		$	14,512		$	(2,763	)	$	(11,749	)		$	32,088



Condensed Consolidated Statement of Earnings
For the year ended December 31, 2014
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Sales	$	459,905		$	551,185		$	348,565		$	(537,672	)	$	821,983
Cost of Sales	309,552			457,001			241,259			(538,256		)	469,556
Gross Profit	150,353			94,184			107,306			584			352,427
Operating Expense:
Research and Development Expense	27,025			302			2,105			—			29,432
Selling and Administrative Expense	93,832			72,010			85,056			—			250,898
Total Operating Expense	120,857			72,312			87,161			—			280,330
Profit from Operations	29,496			21,872			20,145			584			72,097
Other Income (Expense):
Equity in Earnings of Affiliates	34,014			1,876			—			(35,890		)	—
Interest (Expense) Income, Net	(1,486		)	—			66			—			(1,420		)
Intercompany Interest Income (Expense)	7,673			(5,400		)	(2,273		)	—			—
Net Foreign Currency Transaction Gains (Losses)	358			(705		)	(343		)	—			(690		)
Other (Expense) Income, Net	(517		)	463			90			(485		)	(449		)
Total Other Income (Expense), Net	40,042			(3,766		)	(2,460		)	(36,375		)	(2,559		)
Profit Before Income Taxes	69,538			18,106			17,685			(35,791		)	69,538
Income Tax Expense	18,887			5,081			2,967			(8,048		)	18,887
Net Earnings	$	50,651		$	13,025		$	14,718		$	(27,743	)	$	50,651



Condensed Consolidated Statement of Comprehensive Income
For the year ended December 31, 2016
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Earnings	$	46,614		$	15,622	$	8,842		$	(24,464	)	$	46,614
Other Comprehensive Income (Loss):
Foreign currency translation adjustments	109			270		3,534			(3,804		)	109
Pension and retiree medical benefits	(2,248		)	—		(1,691		)	1,691			(2,248		)
Cash flow hedge	(305		)	—		—			—			(305		)
Income Taxes:
Foreign currency translation adjustments	32			—		32			(32		)	32
Pension and retiree medical benefits	504			—		296			(296		)	504
Cash flow hedge	114			—		—			—			114
Total Other Comprehensive (Loss) Income, net of tax	(1,794		)	270		2,171			(2,441		)	(1,794		)
Comprehensive Income	$	44,820		$	15,892	$	11,013		$	(26,905	)	$	44,820



Condensed Consolidated Statement of Comprehensive Income
For the year ended December 31, 2015
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Earnings	$	32,088		$	14,512		$	(2,763	)	$	(11,749	)	$	32,088
Other Comprehensive (Loss) Income:
Foreign currency translation adjustments	(12,520		)	(1,082		)	(12,903		)	13,985			(12,520		)
Pension and retiree medical benefits	4,121			—			1,571			(1,571		)	4,121
Cash flow hedge	164			—			—			—			164
Income Taxes:
Foreign currency translation adjustments	25			—			25			(25		)	25
Pension and retiree medical benefits	(1,265		)	—			(314		)	314			(1,265		)
Cash flow hedge	(61		)	—			—			—			(61		)
Total Other Comprehensive Loss, net of tax	(9,536		)	(1,082		)	(11,621		)	12,703			(9,536		)
Comprehensive Income (Loss)	$	22,552		$	13,430		$	(14,384	)	$	954		$	22,552



Condensed Consolidated Statement of Comprehensive Income
For the year ended December 31, 2014
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
Net Earnings	$	50,651		$	13,025		$	14,718		$	(27,743	)	$	50,651
Other Comprehensive (Loss) Income:
Foreign currency translation adjustments	(10,112		)	(326		)	(9,397		)	9,723			(10,112		)
Pension and retiree medical benefits	(5,382		)	—			(955		)	955			(5,382		)
Income Taxes:
Foreign currency translation adjustments	13			—			13			(13		)	13
Pension and retiree medical benefits	1,859			—			229			(229		)	1,859
Total Other Comprehensive Loss, net of tax	(13,622		)	(326		)	(10,110		)	10,436			(13,622		)
Comprehensive Income	$	37,029		$	12,699		$	4,608		$	(17,307	)	$	37,029



Condensed Consolidated Balance Sheet
As of December 31, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
ASSETS
Current Assets:
Cash and Cash Equivalents	$	38,484		$	226		$	19,323		$	—		$	58,033
Restricted Cash	—			—			517			—			517
Net Receivables	209			85,219			63,706			—			149,134
Intercompany Receivables	50,437			123,289			2,251			(175,977		)	—
Inventories	26,422			12,821			49,829			(10,450		)	78,622
Prepaid Expenses	4,120			1,151			3,933			—			9,204
Other Current Assets	2,402			—			10			—			2,412
Total Current Assets	122,074			222,706			139,569			(186,427		)	297,922
Property, Plant and Equipment	225,651			12,996			59,853			—			298,500
Accumulated Depreciation	(144,281		)	(6,175		)	(35,947		)	—			(186,403		)
Property, Plant and Equipment, Net	81,370			6,821			23,906			—			112,097
Deferred Income Taxes	3,048			3,281			7,110			—			13,439
Investment in Affiliates	157,004			9,021			—			(166,025		)	—
Intercompany Loans	130,000			—			—			(130,000		)	—
Goodwill	12,869			1,439			6,757			—			21,065
Intangible Assets, Net	—			3,200			3,260			—			6,460
Other Assets	10,189			27			8,838			—			19,054
Total Assets	$	516,554		$	246,495		$	189,440		$	(482,452	)	$	470,037
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current Portion of Long-Term Debt	$	3,429		$	—		$	30		$	—		$	3,459
Accounts Payable	30,867			2,599			13,942			—			47,408
Intercompany Payables	125,540			1,249			49,188			(175,977		)	—
Employee Compensation and Benefits	12,025			15,261			8,711			—			35,997
Income Taxes Payable	1,410			—			938			—			2,348
Other Current Liabilities	15,329			13,348			14,940			—			43,617
Total Current Liabilities	188,600			32,457			87,749			(175,977		)	132,829
Long-Term Liabilities:
Long-Term Debt	32,714			—			21			—			32,735
Intercompany Loans	—			128,000			2,000			(130,000		)	—
Employee-Related Benefits	14,291			3,704			3,139			—			21,134
Deferred Income Taxes	—			—			171			—			171
Other Liabilities	2,406			1,295			924			—			4,625
Total Long-Term Liabilities	49,411			132,999			6,255			(130,000		)	58,665
Total Liabilities	238,011			165,456			94,004			(305,977		)	191,494
Shareholders' Equity:
Preferred Stock	—			—			—			—			—
Common Stock	6,633			—			11,131			(11,131		)	6,633
Additional Paid-In Capital	3,653			72,483			158,592			(231,075		)	3,653
Retained Earnings	318,180			9,771			(32,187		)	22,416			318,180
Accumulated Other Comprehensive Loss	(49,923		)	(1,215		)	(42,100		)	43,315			(49,923		)
Total Shareholders’ Equity	278,543			81,039			95,436			(176,475		)	278,543
Total Liabilities and Shareholders’ Equity	$	516,554		$	246,495		$	189,440		$	(482,452	)	$	470,037



Condensed Consolidated Balance Sheet
As of December 31, 2015
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
ASSETS
Current Assets:
Cash and Cash Equivalents	$	35,834		$	—		$	15,466		$	—		$	51,300
Restricted Cash	—			—			640			—			640
Net Receivables	956			77,087			62,402			—			140,445
Intercompany Receivables	38,265			109,753			—			(148,018		)	—
Inventories	29,648			10,626			47,567			(10,549		)	77,292
Prepaid Expenses	8,683			1,307			4,666			—			14,656
Other Current Assets	2,439			—			46			—			2,485
Assets Held for Sale	178			—			6,648			—			6,826
Total Current Assets	116,003			198,773			137,435			(158,567		)	293,644
Property, Plant and Equipment	206,667			9,405			60,739			—			276,811
Accumulated Depreciation	(134,719		)	(6,153		)	(40,981		)	—			(181,853		)
Property, Plant and Equipment, Net	71,948			3,252			19,758			—			94,958
Deferred Income Taxes	—			5,517			6,534			—			12,051
Investment in Affiliates	113,341			6,917			—			(120,258		)	—
Intercompany Loans	141,403			—			—			(141,403		)	—
Goodwill	12,870			—			3,933			—			16,803
Intangible Assets, Net	—			—			3,195			—			3,195
Other Assets	9,304			—			2,340			—			11,644
Total Assets	$	464,869		$	214,459		$	173,195		$	(420,228	)	$	432,295
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current Portion of Long-Term Debt	$	3,429		$	—		$	30		$	—		$	3,459
Accounts Payable	32,338			2,730			15,282			—			50,350
Intercompany Payables	109,753			—			38,265			(148,018		)	—
Employee Compensation and Benefits	13,307			13,570			7,651			—			34,528
Income Taxes Payable	—			—			1,398			—			1,398
Other Current Liabilities	15,222			11,627			16,178			—			43,027
Liabilities Held for Sale	—			—			454			—			454
Total Current Liabilities	174,049			27,927			79,258			(148,018		)	133,216
Long-Term Liabilities:
Long-Term Debt	21,143			—			51			—			21,194
Intercompany Loans	—			120,000			21,403			(141,403		)	—
Employee-Related Benefits	15,255			3,782			2,471			—			21,508
Deferred Income Taxes	—			—			5			—			5
Other Liabilities	2,215			1,173			777			—			4,165
Total Long-Term Liabilities	38,613			124,955			24,707			(141,403		)	46,872
Total Liabilities	212,662			152,882			103,965			(289,421		)	180,088
Shareholders' Equity:
Preferred Stock	—			—			—			—			—
Common Stock	6,654			—			11,116			(11,116		)	6,654
Additional Paid-In Capital	—			68,913			142,584			(211,497		)	—
Retained Earnings	293,682			(5,852		)	(40,431		)	46,283			293,682
Accumulated Other Comprehensive Loss	(48,129		)	(1,484		)	(44,039		)	45,523			(48,129		)
Total Shareholders’ Equity	252,207			61,577			69,230			(130,807		)	252,207
Total Liabilities and Shareholders’ Equity	$	464,869		$	214,459		$	173,195		$	(420,228	)	$	432,295



Condensed Consolidated Statement of Cash Flows
For the year ended December 31, 2016
(in thousands)	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
OPERATING ACTIVITIES
Net Cash Provided by Operating Activities	$	44,147		$	239		$	14,090		$	(598	)	$	57,878
INVESTING ACTIVITIES
Purchases of Property, Plant and Equipment	(21,507		)	(13		)	(5,006		)	—			(26,526		)
Proceeds from Disposals of Property, Plant and Equipment	377			—			238			—			615
Acquisition of Businesses, Net of Cash Acquired	—			(11,539		)	(1,394		)	—			(12,933		)
Issuance of Long-Term Note Receivable	—			—			(2,000		)	—			(2,000		)
Proceeds from Sale of Business	—			—			285			—			285
Change in Investments in Subsidiaries	(19,594		)	—			—			19,594			—
Loan Borrowings (Payments) from Subsidiaries	8,690			—			—			(8,690		)	—
Decrease in Restricted Cash	—			—			116			—			116
Net Cash Used for Investing Activities	(32,034		)	(11,552		)	(7,761		)	10,904			(40,443		)
FINANCING ACTIVITIES
Loan Borrowings (Payments) from Parent	—			7,969			(16,659		)	8,690			—
Change in Subsidiary Equity	—			3,570			16,024			(19,594		)	—
Payments of Long-Term Debt	(3,429		)	—			(31		)	—			(3,460		)
Proceeds from Issuance of Long-Term Debt	15,000			—			—			—			15,000
Purchases of Common Stock	(12,762		)	—			—			—			(12,762		)
Proceeds from Issuances of Common Stock	5,271			—			—			—			5,271
Excess Tax Benefit on Stock Plans	686			—			—			—			686
Dividends Paid	(14,293		)	—			(598		)	598			(14,293		)
Net Cash (Used for) Provided by Financing Activities	(9,527		)	11,539			(1,264		)	(10,306		)	(9,558		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	64			—			(1,208		)	—			(1,144		)
NET INCREASE IN CASH AND CASH EQUIVALENTS	2,650			226			3,857			—			6,733
Cash and Cash Equivalents at Beginning of Year	35,834			—			15,466			—			51,300
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	38,484		$	226		$	19,323		$	—		$	58,033



Condensed Consolidated Statement of Cash Flows
For the year ended December 31, 2015
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
OPERATING ACTIVITIES
Net Cash Provided by Operating Activities	$	40,764		$	—	$	4,928		$	(460	)	$	45,232
INVESTING ACTIVITIES
Purchases of Property, Plant and Equipment	(19,149		)	—		(5,631		)	—			(24,780		)
Proceeds from Disposals of Property, Plant and Equipment	32			—		304			—			336
Loan Borrowings (Payments) from Subsidiaries	268			—		—			(268		)	—
Proceeds from Sale of Business	—			—		1,185			—			1,185
Increase in Restricted Cash	—			—		(322		)	—			(322		)
Net Cash Used for Investing Activities	(18,849		)	—		(4,464		)	(268		)	(23,581		)
FINANCING ACTIVITIES
Loan (Payments) Borrowings from Parent	—			—		(268		)	268			—
Payments of Long-Term Debt	(3,435		)	—		(10		)	—			(3,445		)
Purchases of Common Stock	(45,998		)	—		—			—			(45,998		)
Proceeds from Issuances of Common Stock	1,677			—		—			—			1,677
Excess Tax Benefit on Stock Plans	859			—		—			—			859
Dividends Paid	(14,498		)	—		(460		)	460			(14,498		)
Net Cash Used for Financing Activities	(61,395		)	—		(738		)	728			(61,405		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	79			—		(1,987		)	—			(1,908		)
NET DECREASE IN CASH AND CASH EQUIVALENTS	(39,401		)	—		(2,261		)	—			(41,662		)
Cash and Cash Equivalents at Beginning of Year	75,235			—		17,727			—			92,962
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	35,834		$	—	$	15,466		$	—		$	51,300



Condensed Consolidated Statement of Cash Flows
For the year ended December 31, 2014
(in thousands)	Parent			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total Tennant Company
OPERATING ACTIVITIES
Net Cash Provided by Operating Activities	$	48,487		$	—	$	11,590		$	(715	)	$	59,362
INVESTING ACTIVITIES
Purchases of Property, Plant and Equipment	(15,812		)	—		(3,771		)	—			(19,583		)
Proceeds from Disposals of Property, Plant and Equipment	45			—		246			—			291
Proceeds from Sale of Business	—			—		1,416			—			1,416
Change in Investments in Subsidiaries	(2,400		)	—		—			2,400			—
Loan Borrowings (Payments) from Subsidiaries	3,123			—		—			(3,123		)	—
Decrease in Restricted Cash	—			—		6			—			6
Net Cash Used for Investing Activities	(15,044		)	—		(2,103		)	(723		)	(17,870		)
FINANCING ACTIVITIES
Payments of Short-Term Debt	—			—		(1,500		)	—			(1,500		)
Loan (Payments) Borrowings from Parent	—			—		(3,123		)	3,123			—
Change in Subsidiary Equity	—			—		2,400			(2,400		)	—
Payments of Long-Term Debt	(2,000		)	—		(16		)	—			(2,016		)
Purchases of Common Stock	(14,097		)	—		—			—			(14,097		)
Proceeds from Issuances of Common Stock	2,269			—		—			—			2,269
Excess Tax Benefit on Stock Plans	1,793			—		—			—			1,793
Dividends Paid	(14,487		)	—		(715		)	715			(14,487		)
Net Cash Used for Financing Activities	(26,522		)	—		(2,954		)	1,438			(28,038		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	300			—		(1,776		)	—			(1,476		)
NET INCREASE IN CASH AND CASH EQUIVALENTS	7,221			—		4,757			—			11,978
Cash and Cash Equivalents at Beginning of Year	68,014			—		12,970			—			80,984
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	75,235		$	—	$	17,727		$	—		$	92,962