CONTINGENT LIABILITIES AND COMMITMENTS

3 Months Ended

Mar. 31, 2013

CONTINGENT LIABILITIES AND COMMITMENTS

CONTINGENT LIABILITIES AND COMMITMENTS

NOTE 6: CONTINGENT LIABILITIES AND COMMITMENTS

Litigation

The Company is currently involved in matters of litigation, including environmental contingencies, arising in the ordinary course of business.  The Company accrues for such matters when expenditures are probable and reasonably estimable.  Based upon information presently known, management is of the opinion that such litigation, either individually or in the aggregate, will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

Collective Bargaining

At March 31, 2013, the Company employed a total of 3,171 people.  Approximately 11.6% of the employees are represented by unions.  The Grand Rapids, Michigan plant is the only unionized plant within the U.S and has an agreement with the Carpenters Union, Local 1615, of the United Brotherhood of Carpenters and Joiners of America, Affiliate of the Carpenters Industrial Council (the “Union”), covering approximately 169 hourly employees. The Collective Bargaining Agreement expires April 30, 2015.  Approximately 198 workers in Italy are also represented by unions.

Warranty

The Company offers a warranty for all of its products.  The specific terms and conditions of those warranties vary depending upon the product.  The Company estimates the costs that may be incurred under its warranties and records a liability in the amount of such costs at the time product revenue is recognized.  Factors that affect the Company’s liability include historical product-failure experience and estimated repair costs for identified matters for each specific product category.  The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary.

Changes in the warranty reserve are as follows (in thousands):

Balance, as of December 31, 2012	$	7,852
Provision for warranty claims	1,710
Warranty claims paid	(1,588		)
Foreign currency translation adjustment	(5		)
Balance, as of March 31, 2013	$	7,969

Warranty expense for the three months ended March 31, 2013 and 2012 was $1.7 million.