revg-10q_20200731.htm

false Q3 --10-31 0001687221 Accelerated Filer Quarterly Monthly or Quarterly P8Y P5Y P7Y P8Y P1Y P5Y P7Y P7Y 0001687221 2019-11-01 2020-07-31 xbrli:shares 0001687221 2020-09-04 iso4217:USD 0001687221 2020-07-31 0001687221 2019-10-31 iso4217:USD xbrli:shares 0001687221 2020-05-01 2020-07-31 0001687221 2019-05-01 2019-07-31 0001687221 2018-11-01 2019-07-31 0001687221 2018-10-31 0001687221 2019-07-31 0001687221 us-gaap:CommonStockMember 2019-10-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-10-31 0001687221 us-gaap:RetainedEarningsMember 2019-10-31 0001687221 us-gaap:NoncontrollingInterestMember 2019-10-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-10-31 0001687221 us-gaap:RetainedEarningsMember 2019-11-01 2020-01-31 0001687221 2019-11-01 2020-01-31 0001687221 us-gaap:NoncontrollingInterestMember 2019-11-01 2020-01-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-11-01 2020-01-31 0001687221 us-gaap:CommonStockMember 2019-11-01 2020-01-31 0001687221 us-gaap:CommonStockMember 2020-01-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2020-01-31 0001687221 us-gaap:RetainedEarningsMember 2020-01-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-01-31 0001687221 2020-01-31 0001687221 us-gaap:RetainedEarningsMember 2020-02-01 2020-04-30 0001687221 2020-02-01 2020-04-30 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-02-01 2020-04-30 0001687221 us-gaap:AdditionalPaidInCapitalMember 2020-02-01 2020-04-30 0001687221 us-gaap:CommonStockMember 2020-02-01 2020-04-30 0001687221 us-gaap:CommonStockMember 2020-04-30 0001687221 us-gaap:AdditionalPaidInCapitalMember 2020-04-30 0001687221 us-gaap:RetainedEarningsMember 2020-04-30 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-04-30 0001687221 2020-04-30 0001687221 us-gaap:RetainedEarningsMember 2020-05-01 2020-07-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-05-01 2020-07-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2020-05-01 2020-07-31 0001687221 us-gaap:CommonStockMember 2020-05-01 2020-07-31 0001687221 us-gaap:CommonStockMember 2020-07-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2020-07-31 0001687221 us-gaap:RetainedEarningsMember 2020-07-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-07-31 0001687221 us-gaap:CommonStockMember 2018-10-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2018-10-31 0001687221 us-gaap:RetainedEarningsMember 2018-10-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-10-31 0001687221 us-gaap:RetainedEarningsMember 2018-11-01 2019-01-31 0001687221 2018-11-01 2019-01-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2018-11-01 2019-01-31 0001687221 us-gaap:CommonStockMember 2018-11-01 2019-01-31 0001687221 us-gaap:CommonStockMember 2019-01-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-01-31 0001687221 us-gaap:RetainedEarningsMember 2019-01-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-31 0001687221 2019-01-31 0001687221 us-gaap:RetainedEarningsMember 2019-02-01 2019-04-30 0001687221 2019-02-01 2019-04-30 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-02-01 2019-04-30 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-02-01 2019-04-30 0001687221 us-gaap:CommonStockMember 2019-02-01 2019-04-30 0001687221 us-gaap:CommonStockMember 2019-04-30 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-04-30 0001687221 us-gaap:RetainedEarningsMember 2019-04-30 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-04-30 0001687221 2019-04-30 0001687221 us-gaap:RetainedEarningsMember 2019-05-01 2019-07-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-05-01 2019-07-31 0001687221 us-gaap:CommonStockMember 2019-05-01 2019-07-31 0001687221 us-gaap:CommonStockMember 2019-07-31 0001687221 us-gaap:AdditionalPaidInCapitalMember 2019-07-31 0001687221 us-gaap:RetainedEarningsMember 2019-07-31 0001687221 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-07-31 xbrli:pure 0001687221 revg:AmericanIndustrialPartnersMember 2020-07-30 2020-07-31 0001687221 us-gaap:MajorityShareholderMember 2020-05-01 2020-07-31 0001687221 us-gaap:MajorityShareholderMember srt:MaximumMember 2019-05-01 2019-07-31 0001687221 us-gaap:MajorityShareholderMember 2019-11-01 2020-07-31 0001687221 us-gaap:MajorityShareholderMember 2018-11-01 2019-07-31 0001687221 srt:ManagementMember 2020-05-01 2020-07-31 0001687221 srt:ManagementMember 2019-05-01 2019-07-31 0001687221 srt:ManagementMember 2019-11-01 2020-07-31 0001687221 srt:ManagementMember 2018-11-01 2019-07-31 0001687221 revg:SpartanEmergencyResponseMember 2020-02-01 2020-02-01 0001687221 revg:SpartanEmergencyResponseMember us-gaap:SellingGeneralAndAdministrativeExpensesMember 2020-02-01 2020-02-01 0001687221 revg:SpartanEmergencyResponseMember 2020-02-01 0001687221 revg:SpartanEmergencyResponseMember 2020-05-01 2020-07-31 0001687221 revg:SpartanEmergencyResponseMember 2019-11-01 2020-07-31 0001687221 us-gaap:LandAndLandImprovementsMember 2020-07-31 0001687221 us-gaap:LandAndLandImprovementsMember 2019-10-31 0001687221 us-gaap:BuildingAndBuildingImprovementsMember 2020-07-31 0001687221 us-gaap:BuildingAndBuildingImprovementsMember 2019-10-31 0001687221 us-gaap:MachineryAndEquipmentMember 2020-07-31 0001687221 us-gaap:MachineryAndEquipmentMember 2019-10-31 0001687221 us-gaap:VehiclesMember 2020-07-31 0001687221 us-gaap:VehiclesMember 2019-10-31 0001687221 revg:ComputerHardwareAndSoftwareMember 2020-07-31 0001687221 revg:ComputerHardwareAndSoftwareMember 2019-10-31 0001687221 us-gaap:FurnitureAndFixturesMember 2020-07-31 0001687221 us-gaap:FurnitureAndFixturesMember 2019-10-31 0001687221 us-gaap:ConstructionInProgressMember 2020-07-31 0001687221 us-gaap:ConstructionInProgressMember 2019-10-31 0001687221 revg:FireAndEmergencySegmentMember 2020-07-31 0001687221 revg:FireAndEmergencySegmentMember 2019-10-31 0001687221 revg:CommercialMember 2020-07-31 0001687221 revg:CommercialMember 2019-10-31 0001687221 revg:RecreationMember 2020-07-31 0001687221 revg:RecreationMember 2019-10-31 0001687221 2017-10-31 0001687221 2018-07-31 0001687221 us-gaap:CustomerRelationshipsMember 2019-11-01 2020-07-31 0001687221 us-gaap:NoncompeteAgreementsMember 2019-11-01 2020-07-31 0001687221 us-gaap:TradeNamesMember 2019-11-01 2020-07-31 0001687221 us-gaap:CustomerRelationshipsMember 2020-07-31 0001687221 us-gaap:NoncompeteAgreementsMember 2020-07-31 0001687221 us-gaap:TradeNamesMember 2020-07-31 0001687221 us-gaap:CustomerRelationshipsMember 2018-11-01 2019-10-31 0001687221 us-gaap:OrderOrProductionBacklogMember 2018-11-01 2019-10-31 0001687221 us-gaap:NoncompeteAgreementsMember 2018-11-01 2019-10-31 0001687221 us-gaap:TradeNamesMember 2018-11-01 2019-10-31 0001687221 us-gaap:TechnologyBasedIntangibleAssetsMember 2018-11-01 2019-10-31 0001687221 us-gaap:CustomerRelationshipsMember 2019-10-31 0001687221 us-gaap:OrderOrProductionBacklogMember 2019-10-31 0001687221 us-gaap:NoncompeteAgreementsMember 2019-10-31 0001687221 us-gaap:TradeNamesMember 2019-10-31 0001687221 us-gaap:TechnologyBasedIntangibleAssetsMember 2019-10-31 0001687221 revg:CommercialSegmentMember revg:MobilityVanBusinessMember 2018-11-01 2019-01-31 0001687221 revg:RegionalTechnicalCenterMember 2019-02-01 2019-04-30 0001687221 revg:REVCoachSegmentMember 2019-11-01 2020-01-31 0001687221 revg:REVCoachSegmentMember 2020-04-30 0001687221 revg:ShuttleBusBusinessesMember 2020-05-08 2020-05-08 0001687221 revg:ShuttleBusBusinessesMember 2019-11-01 2020-07-31 0001687221 revg:REVCoachSegmentMember 2019-10-31 0001687221 revg:TermLoanMember 2020-07-31 0001687221 revg:TermLoanMember 2019-10-31 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember 2017-04-25 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember revg:SwingLinesLoanMember 2017-04-25 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember us-gaap:LetterOfCreditMember 2017-04-25 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember 2017-04-24 2017-04-25 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember 2017-12-21 2017-12-22 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember srt:MinimumMember 2017-12-22 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember srt:MaximumMember 2017-12-22 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember 2017-12-22 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember srt:MinimumMember 2020-01-31 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember srt:MaximumMember 2020-01-31 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember 2020-01-31 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember us-gaap:BaseRateMember 2017-12-21 2017-12-22 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember us-gaap:EurodollarMember 2017-12-21 2017-12-22 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember 2020-07-31 0001687221 revg:AprilTwoThousandSeventeenAssetBasedLendingFacilityMember srt:MaximumMember 2020-07-31 0001687221 revg:TermLoanMember 2017-04-25 0001687221 revg:TermLoanMember srt:MaximumMember 2019-11-01 2020-07-31 0001687221 revg:TermLoanMember 2019-11-01 2020-07-31 0001687221 revg:TermLoanMember 2018-07-18 2018-07-18 0001687221 revg:TermLoanMember srt:MinimumMember 2018-07-18 0001687221 revg:TermLoanMember srt:MaximumMember 2018-07-18 0001687221 revg:TermLoanMember 2018-07-18 0001687221 revg:TermLoanMember 2019-03-29 2019-03-29 0001687221 revg:TermLoanMember srt:MinimumMember 2019-03-29 0001687221 revg:TermLoanMember srt:MaximumMember 2019-03-29 0001687221 revg:TermLoanMember 2019-03-29 0001687221 srt:MaximumMember 2019-10-18 0001687221 srt:MaximumMember 2019-10-17 0001687221 srt:ScenarioForecastMember srt:MaximumMember 2021-07-31 0001687221 2019-10-18 0001687221 srt:MaximumMember 2020-01-31 0001687221 srt:MaximumMember 2020-01-30 0001687221 srt:ScenarioForecastMember srt:MaximumMember 2021-10-31 0001687221 srt:MinimumMember 2020-04-29 0001687221 srt:ScenarioForecastMember srt:MaximumMember 2021-01-31 0001687221 srt:ScenarioForecastMember srt:MaximumMember 2022-01-31 0001687221 2020-04-29 0001687221 revg:TermLoanMember us-gaap:BaseRateMember 2017-04-24 2017-04-25 0001687221 revg:TermLoanMember us-gaap:EurodollarMember 2017-04-24 2017-04-25 0001687221 revg:TermLoanMember us-gaap:EurodollarMember 2017-04-25 0001687221 revg:TermLoanMember us-gaap:BaseRateMember 2019-11-01 2020-07-31 0001687221 revg:TermLoanMember us-gaap:EurodollarMember 2019-11-01 2020-07-31 0001687221 srt:MaximumMember us-gaap:CommonStockMember 2018-03-20 0001687221 us-gaap:CommonStockMember 2018-09-05 0001687221 us-gaap:CommonStockMember 2018-03-19 2018-03-20 0001687221 us-gaap:CommonStockMember 2018-09-04 2018-09-05 0001687221 us-gaap:CommonStockMember 2018-11-01 2019-10-31 0001687221 us-gaap:CommonStockMember 2019-11-01 2020-07-31 0001687221 us-gaap:EmployeeStockOptionMember 2020-05-01 2020-07-31 0001687221 us-gaap:EmployeeStockOptionMember 2019-05-01 2019-07-31 0001687221 us-gaap:EmployeeStockOptionMember 2019-11-01 2020-07-31 0001687221 us-gaap:EmployeeStockOptionMember 2018-11-01 2019-07-31 0001687221 us-gaap:RestrictedStockUnitsRSUMember 2020-05-01 2020-07-31 0001687221 us-gaap:RestrictedStockUnitsRSUMember 2019-05-01 2019-07-31 0001687221 us-gaap:RestrictedStockUnitsRSUMember 2019-11-01 2020-07-31 0001687221 us-gaap:RestrictedStockUnitsRSUMember 2018-11-01 2019-07-31 0001687221 us-gaap:PerformanceSharesMember 2020-05-01 2020-07-31 0001687221 us-gaap:PerformanceSharesMember 2019-05-01 2019-07-31 0001687221 us-gaap:PerformanceSharesMember 2019-11-01 2020-07-31 0001687221 us-gaap:PerformanceSharesMember 2018-11-01 2019-07-31 0001687221 2017-12-31 2017-12-31 0001687221 srt:MaximumMember 2018-11-01 2019-07-31 0001687221 2018-11-01 2019-10-31 0001687221 srt:MaximumMember 2020-07-31 0001687221 srt:MaximumMember 2019-10-31 revg:Segment 0001687221 revg:FireAndEmergencySegmentMember us-gaap:OperatingSegmentsMember 2020-05-01 2020-07-31 0001687221 revg:CommercialMember us-gaap:OperatingSegmentsMember 2020-05-01 2020-07-31 0001687221 revg:RecreationMember us-gaap:OperatingSegmentsMember 2020-05-01 2020-07-31 0001687221 revg:CorporateReconcilingItemsAndEliminationsMember 2020-05-01 2020-07-31 0001687221 revg:FireAndEmergencySegmentMember us-gaap:OperatingSegmentsMember 2020-07-31 0001687221 revg:CommercialMember us-gaap:OperatingSegmentsMember 2020-07-31 0001687221 revg:RecreationMember us-gaap:OperatingSegmentsMember 2020-07-31 0001687221 revg:CorporateReconcilingItemsAndEliminationsMember 2020-07-31 0001687221 revg:FireAndEmergencySegmentMember us-gaap:OperatingSegmentsMember 2019-05-01 2019-07-31 0001687221 revg:CommercialMember us-gaap:OperatingSegmentsMember 2019-05-01 2019-07-31 0001687221 revg:RecreationMember us-gaap:OperatingSegmentsMember 2019-05-01 2019-07-31 0001687221 revg:CorporateReconcilingItemsAndEliminationsMember 2019-05-01 2019-07-31 0001687221 revg:FireAndEmergencySegmentMember us-gaap:OperatingSegmentsMember 2019-07-31 0001687221 revg:CommercialMember us-gaap:OperatingSegmentsMember 2019-07-31 0001687221 revg:RecreationMember us-gaap:OperatingSegmentsMember 2019-07-31 0001687221 revg:CorporateReconcilingItemsAndEliminationsMember 2019-07-31 0001687221 us-gaap:OperatingSegmentsMember revg:FireAndEmergencySegmentMember 2019-11-01 2020-07-31 0001687221 us-gaap:OperatingSegmentsMember revg:CommercialMember 2019-11-01 2020-07-31 0001687221 us-gaap:OperatingSegmentsMember revg:RecreationMember 2019-11-01 2020-07-31 0001687221 revg:CorporateReconcilingItemsAndEliminationsMember 2019-11-01 2020-07-31 0001687221 us-gaap:OperatingSegmentsMember revg:FireAndEmergencySegmentMember 2018-11-01 2019-07-31 0001687221 us-gaap:OperatingSegmentsMember revg:CommercialMember 2018-11-01 2019-07-31 0001687221 us-gaap:OperatingSegmentsMember revg:RecreationMember 2018-11-01 2019-07-31 0001687221 revg:CorporateReconcilingItemsAndEliminationsMember 2018-11-01 2019-07-31 0001687221 us-gaap:CorporateAndOtherMember 2020-05-01 2020-07-31 0001687221 us-gaap:CorporateAndOtherMember 2019-05-01 2019-07-31 0001687221 us-gaap:CorporateAndOtherMember 2019-11-01 2020-07-31 0001687221 us-gaap:CorporateAndOtherMember 2018-11-01 2019-07-31 0001687221 us-gaap:MaterialReconcilingItemsMember 2020-05-01 2020-07-31 0001687221 us-gaap:MaterialReconcilingItemsMember 2019-05-01 2019-07-31 0001687221 us-gaap:MaterialReconcilingItemsMember 2019-11-01 2020-07-31 0001687221 us-gaap:MaterialReconcilingItemsMember 2018-11-01 2019-07-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2020

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-37999

REV Group, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware	26-3013415
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

245 South Executive Drive Brookfield, WI	53005
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (414) 290-0190

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock ($0.001 Par Value)	REVG	New York Stock Exchange

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 every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Small reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of September 4, 2020, the registrant had 63,476,203 shares of common stock, $0.001 par value per share, outstanding.

Table of Contents

		Page
Cautionary Statement About Forward-Looking Statements		3
Website and Social Media Disclosure		3
PART I.	FINANCIAL INFORMATION	4
Item 1.	Financial Statements	4
	Condensed Unaudited Consolidated Balance Sheets	4
	Condensed Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income	5
	Condensed Unaudited Consolidated Statements of Cash Flows	6
	Condensed Unaudited Consolidated Statements of Shareholders’ Equity	7
	Notes to Condensed Unaudited Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34
Item 4.	Controls and Procedures	34
PART II.	OTHER INFORMATION	34
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 6.	Exhibits	36
Signatures		37

Cautionary Statement About Forward-Looking Statements

This Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” “contemplate,” “aim” and other similar expressions, and include our segment net sales and other expectations described under “Overview” below, although not all forward-looking statements contain these identifying words. Investors are cautioned that forward-looking statements are inherently uncertain. A number of factors could cause actual results to differ materially from these statements, including, but not limited to increases in interest rates, availability of credit, low consumer confidence, availability of labor, significant increases in repurchase obligations, inadequate liquidity or capital resources, availability and price of fuel, a slowdown in the economy, increased material and component costs, availability of chassis and other key component parts, sales order cancellations, slower than anticipated sales of new or existing products, new product introductions by competitors, the effect of global tensions, integration of operations relating to mergers and acquisitions activities and the overall impact of the novel coronavirus, known as "COVID-19", pandemic on the Company’s business, results of operations and financial condition. Additional information concerning certain risks and uncertainties that could cause actual results to differ materially from that projected or suggested is contained in the “Risk Factors” section in our filings with the U.S. Securities and Exchange Commission (“SEC”). We disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this Form 10-Q or to reflect any changes in expectations after the date of this release or any change in events, conditions or circumstances on which any statement is based, except as required by law.

Website and Social Media Disclosure

We use our website (www.revgroup.com) and corporate Twitter account (@revgroupinc) as routine channels of distribution of company information, including news releases, analyst presentations, and supplemental financial information, as a means of disclosing material non-public information and for complying with our disclosure obligations under SEC Regulation FD. Accordingly, investors should monitor our website and our corporate Twitter account in addition to following press releases, SEC filings and public conference calls and webcasts. Additionally, we provide notifications of news or announcements as part of our investor relations website. Investors and others can receive notifications of new information posted on our investor relations website in real time by signing up for email alerts.

None of the information provided on our website, in our press releases, public conference calls and webcasts, or through social media channels is incorporated into, or deemed to be a part of, this Quarterly Report on Form 10-Q or in any other report or document we file with the SEC, and any references to our website or our social media channels are intended to be inactive textual references only.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

REV Group, Inc. and Subsidiaries

Condensed Unaudited Consolidated Balance Sheets

(Dollars in millions, except per share amounts)

				(Audited)
	July 31, 2020			October 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	17.3		$	3.3
Accounts receivable, net		239.3			253.5
Inventories, net		572.3			513.4
Other current assets		57.9			19.4
Assets held for sale		—			19.5
Total current assets		886.8			809.1
Property, plant and equipment, net		182.3			201.7
Goodwill		157.3			159.8
Intangible assets, net		142.3			159.9
Right of use assets		24.7			—
Other long-term assets		16.0			16.6
Total assets	$	1,409.4		$	1,347.1
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	1.7		$	3.6
Accounts payable		175.8			200.8
Customer advances		185.9			129.9
Accrued warranty		23.7			16.1
Short-term lease obligations		9.3			—
Liabilities held for sale		—			15.4
Other current liabilities		72.4			70.2
Total current liabilities		468.8			436.0
Long-term debt, less current maturities		388.7			376.6
Deferred income taxes		27.6			15.4
Long-term lease obligations		16.8			—
Other long-term liabilities		25.4			13.9
Total liabilities		927.3			841.9
Commitments and contingencies
Shareholders' Equity:
Common stock ($.001 par value, 605,000,000 shares authorized; 63,476,203 and 62,217,486 shares issued and outstanding, respectively)		0.1			0.1
Additional paid-in capital		495.8			490.8
Retained (deficit) earnings		(11.2	)		15.8
Accumulated other comprehensive loss		(2.6	)		(1.7	)
Total REV's shareholders' equity		482.1			505.0
Non-controlling interest		—			0.2
Total shareholders' equity		482.1			505.2
Total liabilities and shareholders' equity	$	1,409.4		$	1,347.1

See Notes to Condensed Unaudited Consolidated Financial Statements.

REV Group, Inc. and Subsidiaries

Condensed Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income

(Dollars in millions, except per share amounts)

	Three Months Ended July 31,					Nine Months Ended July 31,
	2020			2019		2020			2019
Net sales	$	582.2		$	617.0	$	1,661.3		$	1,750.8
Cost of sales		515.7			545.7		1,495.0			1,560.7
Gross profit		66.5			71.3		166.3			190.1
Operating expenses:
Selling, general and administrative		53.5			48.9		157.6			145.3
Research and development costs		1.7			1.2		4.4			3.7
Amortization of intangible assets		3.0			4.0		10.4			13.2
Restructuring		2.5			1.3		6.0			4.2
Impairment charges		3.7			—		3.7			2.8
Total operating expenses		64.4			55.4		182.1			169.2
Operating income (loss)		2.1			15.9		(15.8	)		20.9
Interest expense, net		5.7			8.4		20.3			24.2
Loss on sale of business		0.5			—		9.3			—
Gain on acquisition of business		—			—		(11.9	)		—
(Loss) income before (benefit) provision for income taxes		(4.1	)		7.5		(33.5	)		(3.3	)
(Benefit) provision for income taxes		(0.5	)		1.9		(13.2	)		—
Net (loss) income	$	(3.6	)	$	5.6	$	(20.3	)	$	(3.3	)

Other comprehensive loss, net of tax		(0.8	)		—		(0.9	)		(0.2	)
Comprehensive (loss) income	$	(4.4	)	$	5.6	$	(21.2	)	$	(3.5	)

Net (loss) income per common share:
Basic	$	(0.06	)	$	0.09	$	(0.32	)	$	(0.05	)
Diluted	$	(0.06	)	$	0.09	$	(0.32	)	$	(0.05	)
Dividends declared per common share	$	-		$	0.05	$	0.10		$	0.15

See Notes to Condensed Unaudited Consolidated Financial Statements.

REV Group, Inc. and Subsidiaries

Condensed Unaudited Consolidated Statements of Cash Flows

(Dollars in millions)

	Nine Months Ended July 31,
	2020			2019
Cash flows from operating activities:
Net loss	$	(20.3	)	$	(3.3	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		30.9			34.8
Amortization of debt issuance costs		1.8			1.5
Stock-based compensation expense		7.2			7.3
Deferred income taxes		8.3			3.5
Gain on sale of assets		(0.8	)		(1.7	)
Impairment charges		3.7			2.8
Loss on sale of business		9.3			—
Gain on acquisition of business		(11.9	)		—
Changes in operating assets and liabilities, net		(3.2	)		(22.9	)
Net cash provided by operating activities		25.0			22.0
Cash flows from investing activities:
Purchase of property, plant and equipment		(9.7	)		(14.1	)
Purchase of rental and used vehicles		(3.3	)		(3.0	)
Proceeds from sale of assets		6.7			22.6
Proceeds from sale of businesses		50.9			—
Acquisition of business		(54.8	)		—
Net cash (used in) provided by investing activities		(10.2	)		5.5
Cash flows from financing activities:
Net proceeds (repayments) from borrowings under April 2017 ABL Facility		13.0			(52.0	)
Net proceeds from borrowings of Term Loan		—			49.2
Repayment of long-term debt		(2.9	)		(1.1	)
Payment of dividends		(9.5	)		(9.4	)
Repurchase and retirement of common stock		—			(8.3	)
Other financing activities		(1.4	)		2.0
Net cash used in financing activities		(0.8	)		(19.6	)
Net increase in cash and cash equivalents		14.0			7.9
Cash and cash equivalents, beginning of period		3.3			11.9
Cash and cash equivalents, end of period	$	17.3		$	19.8

Supplemental disclosures of cash flow information:
Cash paid (received) for:
Interest	$	20.9	$	22.6
Income taxes, net of refunds	$	0.4	$	(9.0	)

See Notes to Condensed Unaudited Consolidated Financial Statements.

REV Group, Inc. and Subsidiaries

Condensed Unaudited Consolidated Statements of Shareholders’ Equity

(Dollars in millions)

	Common Stock				Additional Paid-in			Retained			Non-controlling			Accumulated Other Comprehensive			Total Shareholders'
	Amount		# Shares		Capital			Earnings (Deficit)			Interest			Loss			Equity
Balance, October 31, 2019	$	0.1		62,217,486 Sh.	$	490.8		$	15.8		$	0.2		$	(1.7	)	$	505.2
Net loss									(9.4	)								(9.4	)
Sale of business												(0.2	)					(0.2	)
Other comprehensive loss, net of tax															—			—
Stock-based compensation expense						2.6												2.6
Exercise of common stock options		—		102,000 Sh.		0.8												0.8
Vesting of restricted and performance stock, net of employee tax withholdings		—		360,986 Sh.		—												—
Dividends declared on common stock									(3.1	)								(3.1	)
Balance, January 31, 2020	$	0.1		62,680,472 Sh.	$	494.2		$	3.3		$	—		$	(1.7	)	$	495.9
Net loss									(7.6	)								(7.6	)
Other comprehensive loss, net of tax															(0.1	)		(0.1	)
Stock-based compensation expense						2.9												2.9
Vesting and issuance of restricted stock units and awards, net of forfeitures and employee tax withholdings		—		717,054 Sh.		(1.2	)											(1.2	)
Reclassification of liability awards						(1.7	)											(1.7	)
Dividends declared on common stock									(3.3	)								(3.3	)
Balance, April 30, 2020	$	0.1		63,397,526 Sh.	$	494.2		$	(7.6	)	$	—		$	(1.8	)	$	484.9
Net loss									(3.6	)								(3.6	)
Other comprehensive loss, net of tax															(0.8	)		(0.8	)
Stock-based compensation expense						1.6												1.6
Vesting and issuance of restricted stock units and awards, net of forfeitures and employee tax withholdings		—		78,677 Sh.		—												—
Balance, July 31, 2020	$	0.1		63,476,203 Sh.	$	495.8		$	(11.2	)	$	—		$	(2.6	)	$	482.1

	Common Stock				Additional Paid-in			Retained			Accumulated Other Comprehensive			Total Shareholders'
	Amount		# Shares		Capital			Earnings			Loss			Equity
Balance, October 31, 2018	$	0.1		62,683,808 Sh.	$	492.1		$	40.6		$	(1.4	)	$	531.4
Net loss									(14.6	)					(14.6	)
Other comprehensive income (loss), net of tax												—			—
Stock-based compensation expense						1.4									1.4
Exercise of common stock options		—		20,000 Sh.		0.1									0.1
Vesting of restricted and performance stock, net of employee tax withholdings		—		94,237 Sh.		—									—
Dividends declared on common stock									(3.2	)					(3.2	)
Balance, January 31, 2019	$	0.1		62,798,045 Sh.	$	493.6		$	22.8		$	(1.4	)	$	515.1
Net income									5.6						5.6
Other comprehensive income (loss), net of tax												(0.2	)		(0.2	)
Stock-based compensation expense						2.9									2.9
Exercise of common stock options		—		54,000 Sh.		0.4									0.4
Vesting of restricted and performance stock, net of employee tax withholdings		—		40,828 Sh.		—									—
Dividends declared on common stock									(3.2	)					(3.2	)
Repurchase and retirement of common stock				(495,475) Sh.		(5.3	)								(5.3	)
Balance, April 30, 2019	$	0.1		62,397,398 Sh.	$	491.6		$	25.2		$	(1.6	)	$	515.3
Net income									5.6						5.6
Other comprehensive loss, net of tax												—			—
Stock-based compensation expense						1.7									1.7
Exercise of common stock options		—		25,999 Sh.		0.1									0.1
Vesting of restricted and performance stock, net of shares withheld for employee taxes		—		6,566 Sh.		—									—
Dividends declared on common stock									(3.2	)					(3.2	)
Repurchase and retirement of common stock				(222,122) Sh.		(3.0	)								(3.0	)
Balance, July 31, 2019	$	0.1		62,207,841 Sh.	$	490.4		$	27.6		$	(1.6	)	$	516.5

See Notes to Condensed Unaudited Consolidated Financial Statements.

REV Group, Inc. and Subsidiaries

Notes to the Condensed Unaudited Consolidated Financial Statements

(All tabular amounts presented in millions, except share and per share amounts)

Note 1. Basis of Presentation

The unaudited Condensed Consolidated Financial Statements include the accounts of REV Group, Inc. (“REV” or “the Company”) and all its subsidiaries. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments (which include normal recurring adjustments, unless otherwise noted) necessary to present fairly the financial position, results of operations and cash flows for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited financial statements and notes thereto included in the Annual Report on Form 10-K of the Company for the year ended October 31, 2019. The interim results are not necessarily indicative of results for the full year. Certain reclassifications have been made to the fiscal year 2019 financial statements to conform to the fiscal year 2020 presentation.

Equity Sponsor: The Company’s primary equity holders are funds and an investment vehicle associated with AIP CF IV, LLC, which the Company collectively refers to as “American Industrial Partners,” “AIP” or “Sponsor” and which indirectly own approximately 53.2% of REV Group’s voting equity as of July 31, 2020. AIP is an operations and engineering-focused private equity firm headquartered in New York, New York.

Related Party Transactions: During the three months ended July 31, 2020 and July 31, 2019, the Company reimbursed expenses of its primary equity holder in the amount of $0.1 million and less than $0.1 million, respectively. During the nine months ended July 31, 2020 and July 31, 2019, the Company reimbursed expenses of its primary equity holder in the amount of $0.2 million and $0.6 million, respectively. These expenses are included in selling, general and administrative expenses in the Company’s Condensed Unaudited Consolidated Statements of Operations.

Certain production facilities and offices for two of the Company’s subsidiaries are leased from certain members of management. Rent expense under these arrangements totaled $0.1 million and $0.5 million for the three months ended July 31, 2020, and July 31, 2019, respectively. Rent expense under these arrangements totaled $0.7 million and $1.5 million for the nine months ended July 31, 2020, and July 31, 2019, respectively.

Recent Accounting Pronouncements

Accounting Pronouncements Recently Adopted

The following accounting pronouncements did not have a material impact on the Company’s consolidated financial statements:

•

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-02, “Leases” (Accounting Standards Codification (ASC) 842). ASC 842 is intended to increase transparency and comparability among organizations by recognizing lease liabilities with corresponding right-of-use (“ROU”) assets on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the new standard on November 1, 2019, following the optional transition method provided by ASU No. 2018-11. Accordingly, prior period comparative information was not recast to reflect the impact of the new guidance and therefore continues to be reported under the accounting guidance in effect during those periods (ASC 840). The most significant impact of the Company’s adoption of ASC 842 is the recognition of ROU assets and lease liabilities on the balance sheet for operating leases. The adoption did not have any impact on the Company’s results of operations or cash flows.

ASC 842 provides a number of optional transition related practical expedients. The Company elected to adopt the standard using the package of practical expedients, which allowed the Company not to reassess prior conclusions about the identification of leases, the classification of leases, and the treatment of initial direct costs. ASC 842 also provides a number of optional practical expedients for an entity’s ongoing lessee accounting. In connection with our evaluation of these practical expedients, the Company has elected not to separate payments for lease components from payments for non-lease components for all classes of leases. Additionally, the Company has elected the short-term lease recognition exemption for all leases that qualify, which means ROU assets and lease liabilities will not be recognized for leases with an initial term of twelve months or less.

Note 2. Revenue Recognition

Substantially all of the Company’s revenue is recognized from contracts with customers with product shipment destinations in the United States and Canada. The Company accounts for a contract when it has approval and commitment from both parties, the rights and payment terms of the parties are identified, the contract has commercial substance and collectability of consideration is probable. The Company determines the transaction price for each contract at inception based on the consideration that it expects to receive for the goods and services promised under the contract. The transaction price excludes sales and usage-based taxes collected.

The Company’s primary source of revenue is generated from the manufacture and sale of specialty vehicles through its direct sales force or dealer network. The Company also generates revenue through separate contracts that relate to the sale of aftermarket parts and services. Revenue is typically recognized at a point-in-time, when control is transferred, which generally occurs when the product has been shipped to the customer or when it has been picked-up from the Company’s manufacturing facilities. Shipping and handling costs that occur after the transfer of control are fulfillment costs that are accrued when control is transferred. Periodically, certain customers request bill and hold transactions. In such cases, revenue is not recognized until after control has transferred which is generally when the customer has requested such transaction and has been notified that the product (i) has been completed according to customer specifications, (ii) has passed our quality control inspections, and (iii) has been separated from our inventory and is ready for physical transfer to the customer. Warranty obligations associated with the sale of a unit are assurance-type warranties that are a guarantee of the unit’s intended functionality and, therefore, do not represent a distinct performance obligation within the context of the contract.

Contract Assets and Contract Liabilities

The Company is generally entitled to bill its customers upon satisfaction of its performance obligations, and payment is usually received shortly after billing. Payments for certain contracts are received in advance of satisfying the related performance obligations. Such payments are recorded as customer advances in the Company’s Condensed Unaudited Consolidated Balance Sheets. The corresponding performance obligations are generally satisfied within one year of the contract inception. During the three months ended July 31, 2020 and July 31, 2019, the Company recognized $23.5 million and $30.0 million, respectively, of revenue that was included in the customer advance balances as of October 31, 2019 and October 31, 2018, respectively. During the nine months ended July 31, 2020 and July 31, 2019, the Company recognized $104.1 million and $94.9 million, respectively, of revenue that was included in the customer advance balances as of October 31, 2019 and October 31, 2018, respectively. The Company’s payment terms do not include a significant financing component and the Company does not have significant contract assets.

Note 3. Leases

The Company leases certain administrative and production facilities and equipment under long-term, non-cancelable operating lease agreements. The Company determines if an arrangement is or contains a lease at contract inception and recognizes a ROU asset and a lease liability based on the present value of fixed, and certain index-based lease payments at the lease commencement date. Variable payments are excluded from the present value of lease payments and are recognized in the period in which the payment is made. Lease agreements may include options to extend or terminate the lease or purchase the underlying asset. In situations where the Company is reasonably certain to exercise such options, they are considered in determining the lease term and the associated option payments, or exercise price in the case of an option to purchase, are included in the measurement of the lease liabilities and ROU assets. The Company’s leases generally do not include restrictive financial or other covenants, or residual value guarantees. The Company generally uses its incremental borrowing rate as the discount rate for measuring its lease liabilities, as the Company cannot determine the interest rate implicit in the lease because it does not have access to certain lessor specific information. Lease expense is recognized on a straight-line basis over the lease term. The Company does not have significant finance leases.

During the three and nine months ended July 31, 2020, the Company recognized total operating lease costs of approximately $2.8 million and $7.6 million, respectively, and paid cash of $2.3 million and $6.9 million, respectively, for amounts included in the measurement of lease liabilities.

At July 31, 2020, future minimum operating lease payments due under ASC 842 are summarized by fiscal year in the table below:

Remaining three months of fiscal year 2020	$	2.3
2021		8.7
2022		6.9
2023		4.2
2024		2.4
Thereafter		3.9
Total undiscounted lease payments		28.4
Less: imputed interest		(2.4	)
Total lease liabilities	$	26.0

As of July 31, 2020, the weighted average remaining lease term and the weighted average discount rate for operating leases was 4.7 years and 5.0%, respectively.

As of October 31, 2019, future minimum operating lease payments (under ASC 840) summarized by fiscal year were as follows:

2020	$	8.5
2021		7.5
2022		5.8
2023		3.3
2024		1.5
Thereafter		0.1

Note 4. Acquisition

Spartan Emergency Response

On February 1, 2020, the Company acquired substantially all of the assets and liabilities of Spartan Emergency Response (“Spartan ER”), a leading designer, manufacturer and distributor of custom emergency response vehicles, cabs and chassis for the emergency response market, and its brands, from Spartan Motors, Inc. (NASDAQ: SPAR). Spartan ER is reported as part of the Fire & Emergency segment. The acquisition increases the Company’s market share in several key product categories and provides access to several new large municipalities and regional markets. The purchase price for Spartan ER was $54.8 million, subject to an adjustment based on the level of net working capital at closing, as defined in the purchase agreement. The net cash consideration paid at closing was funded through the Company’s ABL credit facility. The preliminary purchase price allocation resulted in a gain of $11.9 million, which is included in the Company’s Condensed Unaudited Consolidated Statement of Operations for the nine months ended July 31, 2020. Prior to recognizing the gain, the Company reassessed the measurement and recognition of identifiable assets acquired, and liabilities assumed and concluded that the valuation procedures and resulting preliminary measures were appropriate. The Company believes that its ability to negotiate a purchase price lower than the fair market value of the acquired net assets was due to the limited number of strategic buyers that exist in this specific market and the desire of the sellers to exit the business on an accelerated basis. The Company incurred acquisition related costs of $1.6 million, which are included in selling, general and administrative expenses in the Company’s Condensed Unaudited Consolidated Statements of Operations for the three and nine months ended July 31, 2020.

As of July 31, 2020, the fair value of the acquired assets, liabilities and gain on acquisition of business, is provisional pending receipt of the final valuation report from a third-party valuation firm.

The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed for Spartan ER:

Assets:
Accounts receivable, net	$	30.9
Inventories, net		77.7
Other current assets		2.4
Property, plant and equipment		15.2
Right of use assets		6.0
Total assets acquired		132.2
Liabilities:
Accounts payable		5.0
Customer advances		32.8
Accrued warranty		2.7
Other current liabilities		5.1
Short-term lease obligations		0.8
Deferred income taxes		3.9
Long-term lease obligations		5.4
Other long-term liabilities		9.8
Total liabilities assumed		65.5
Net assets acquired		66.7
Consideration paid		54.8
Gain on acquisition of business	$	(11.9	)

Net sales and operating income attributable to Spartan ER for the three and nine months ended July 31, 2020 were $74.5 million and $137.1 million, and $4.5 million and $5.6 million, respectively. In connection with the acquisition, Spartan ER changed its method for recognizing revenue from over-time to point-in-time to align with the Company. The Company determined that it is impracticable to determine the cumulative effect of applying this change retrospectively because records of certain sales transactions are no longer available for all prior periods. Accordingly, the supplemental proforma disclosures required by ASC 805 have been omitted.

Note 5. Inventories

Inventories, net of reserves, consisted of the following:

	July 31, 2020			October 31, 2019
Chassis	$	44.3		$	44.9
Raw materials		211.8			198.1
Work in process		256.6			200.8
Finished products		73.2			79.6
		585.9			523.4
Less: reserves		(13.6	)		(10.0	)
Total inventories, net	$	572.3		$	513.4

Note 6. Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	July 31, 2020			October 31, 2019
Land & land improvements	$	27.0		$	24.2
Buildings & improvements		104.5			107.6
Machinery & equipment		84.6			93.1
Rental & used vehicles		21.4			24.4
Computer hardware & software		55.6			58.1
Office furniture & fixtures		6.2			5.8
Construction in process		8.0			11.4
		307.3			324.6
Less: accumulated depreciation		(125.0	)		(122.9	)
Total property, plant and equipment, net	$	182.3		$	201.7

Depreciation expense was $6.2 million and $6.7 million for the three months ended July 31, 2020, and July 31, 2019, respectively, and $20.5 million and $21.5 million for the nine months ended July 31, 2020, and July 31, 2019, respectively.

In connection with the anticipated liquidation of all rental vehicles, the Company recorded a $3.7 million impairment charge during the three months ended July 31, 2020. This impairment charge represents the difference between the carrying value of the assets and expected sale proceeds and is included in the Company’s Condensed Unaudited Consolidated Statement of Operations for the three and nine months ended July 31, 2020.

Note 7. Goodwill and Intangible Assets

The table below represents goodwill by segment:

	July 31, 2020		October 31, 2019
Fire & Emergency	$	88.6	$	88.6
Commercial		26.2		28.7
Recreation		42.5		42.5
Total goodwill	$	157.3	$	159.8

The change in the net carrying value amount of goodwill consisted of the following:

	Nine Months Ended July 31,
	2020			2019
Balance at beginning of period	$	159.8		$	161.8
Activity during the period:
Acquisitions		—			(2.0	)
Divestitures		(2.5	)		—
Balance at end of period	$	157.3		$	159.8

Intangible assets (excluding goodwill) consisted of the following:

	July 31, 2020
	Weighted- Average Life		Gross		Accumulated Amortization			Net
Finite-lived intangible assets:
Customer relationships		8.0	$	69.8	$	(37.9	)	$	31.9
Non-compete agreements		5.0		2.0		(1.7	)		0.3
Trade names		7.0		1.3		(1.3	)		—
				73.1		(40.9	)		32.2
Indefinite-lived trade names				110.1		—			110.1
Total intangible assets, net			$	183.2	$	(40.9	)	$	142.3

	October 31, 2019
	Weighted- Average Life		Gross		Accumulated Amortization			Net
Finite-lived intangible assets:
Customer relationships		8.0	$	126.7	$	(84.0	)	$	42.7
Order backlog		1.0		6.7		(6.7	)		—
Non-compete agreements		5.0		2.0		(1.3	)		0.7
Trade names		7.0		3.5		(3.0	)		0.5
Technology-related		7.0		0.9		(0.8	)		0.1
				139.8		(95.8	)		44.0
Indefinite-lived trade names				115.9		—			115.9
Total intangible assets, net			$	255.7	$	(95.8	)	$	159.9

Amortization expense was $3.0 million and $4.1 million for the three months ended July 31, 2020, and July 31, 2019, respectively, and $10.4 and $13.3 million for the nine months ended July 31, 2020, and July 31, 2019, respectively. As of July 31, 2020, fully amortized intangible assets and the related accumulated amortization were written off.

Note 8. Divestiture Activities

In the first quarter of fiscal year 2019, the Company completed the sale of the assets of its mobility van business, Revability, with annual sales of approximately $40 million. In the second quarter of fiscal year 2019, the Company completed the sale of a Regional Technical Center (“RTC”) for net cash proceeds of $11.4 million. In connection with this sale, the Company recognized a gain on sale of $1.2 million.

In the first quarter of fiscal year 2020, the Company completed the sale of REV Coach. The Company received cash proceeds of $1.1 million in the first quarter of fiscal year 2020, and the remaining $0.9 million in the second quarter of fiscal year 2020.

Effective May 8, 2020, and in connection with a strategic review of the product portfolio, the Company completed the sale of its shuttle bus businesses for $48.9 million in cash. As a result, the Company recorded a loss on sale of $9.3 million, which is included in the Company’s Condensed Unaudited Consolidated Statement of Operations for the nine months ended July 31, 2020. The Company used the proceeds from the disposition to reduce outstanding borrowings. The shuttle bus businesses were previously reported as part of the Commercial segment.

As of October 31, 2019, assets and liabilities held for sale consisted of the following balances related to the sale of REV Coach: property, plant and equipment, net—$0.2 million, inventories, net—$14.0 million, accounts receivable, net—$0.4 million, other current and long-term assets—$4.9 million, accounts payable—$11.7 million and other current and long-term liabilities—$3.7 million.

Note 9. Long-Term Debt

The Company was obligated under the following debt instruments:

	July 31, 2020			October 31, 2019
April 2017 ABL facility	$	223.0		$	210.0
Term Loan, net of debt issuance costs ($2.0 and $2.2)		167.4			170.2
		390.4			380.2
Less: current maturities		(1.7	)		(3.6	)
Long-term debt, less current maturities	$	388.7		$	376.6

April 2017 ABL Facility

Effective April 25, 2017, the Company entered into a $350.0 million revolving credit and guaranty agreement (the “April 2017 ABL Facility” or “ABL Agreement”) with a syndicate of lenders. The April 2017 ABL Facility consists of: (i) Revolving Loans, (ii) Swing Line Loans, and (iii) Letters of Credit, aggregating up to a combined maximum of $350.0 million. The total amount borrowed under the April 2017 ABL Facility is subject to a $30.0 million sublimit for Swing Line loans and a $35.0 million sublimit for Letters of Credit, along with certain borrowing base and other customary restrictions as defined in the ABL Agreement. The Company incurred $4.9 million of debt issuance costs related to the April 2017 ABL Facility. The amount of debt issuance costs is included in other long-term assets in the Company’s Condensed Unaudited Consolidated Balance Sheets.

The April 2017 ABL Facility allows for incremental borrowing capacity in an aggregate amount of up to $100.0 million, plus the excess, if any, of the borrowing base then in effect over total commitments then in effect. Any such incremental borrowing capacity is subject to receiving additional commitments from lenders and certain other customary conditions. The April 2017 ABL Facility matures on April 25, 2022. The Company may prepay principal, in whole or in part, at any time without penalty.

The following amendments have been made to the April 2017 ABL Facility:

•

On December 22, 2017, the Company exercised a $100.0 million incremental borrowing capacity option under the April 2017 ABL Facility to fund the Lance Camper acquisition, which increased total borrowing capacity under the facility from $350.0 million to $450.0 million. The Company incurred an additional $0.4 million of debt issuance costs related to the incremental borrowing capacity option under the April 2017 ABL Facility.

•

On January 31, 2020, the Company increased total borrowing capacity under the facility, in anticipation of its acquisition of Spartan ER, from $450.0 million to $500.0 million. The Company incurred an additional $0.4 million of debt issuance costs related to the incremental borrowing capacity option under the April 2017 ABL Facility. The outstanding balance for the April 2017 ABL facility as of January 31, 2020 reflects the draw-down of additional debt to fund the acquisition of Spartan ER.

Revolving Loans under the April 2017 ABL Facility bear interest at rates equal to, at the Company’s option, either a base rate plus an applicable margin, or a Eurodollar rate plus an applicable margin. Applicable interest rate margins are initially 0.75% for all base rate loans and 1.75% for all Eurodollar rate loans (with the Eurodollar rate having a floor of 0%), subject to adjustment based on utilization in accordance with the ABL Agreement. The weighted-average interest rate on borrowings outstanding under the April 2017 ABL Facility was 2.11% as of July 31, 2020. Interest is payable quarterly for all base rate loans and is payable monthly or quarterly for all Eurodollar rate loans.

The lenders under the April 2017 ABL Facility have a first priority security interest in substantially all accounts receivable and inventory of the Company, and a second priority security interest in substantially all other assets of the Company.

The April 2017 ABL Facility contains customary representations and warranties, affirmative and negative covenants, subject in certain cases to customary limitations, exceptions and exclusions. The April 2017 ABL Facility also contains certain customary events of default, which should such events occur, could result in the termination of the commitments under the April 2017 ABL Facility and the acceleration of all outstanding borrowings under it. The April 2017 ABL Facility contains a financial covenant restricting the Company from allowing its fixed charge coverage ratio to drop below 1.00 to 1.00 during a compliance period, which is triggered when the availability under the April 2017 ABL Facility falls below a threshold set forth in the credit agreement.

The Company was in compliance with all financial covenants under the April 2017 ABL Facility as of July 31, 2020. As of July 31, 2020, the Company’s availability under the April 2017 ABL Facility was $220.6 million.

The fair value of the April 2017 ABL Facility approximated book value at both July 31, 2020 and October 31, 2019.

Term Loan

Effective April 25, 2017, the Company entered into a $75.0 million term loan agreement (“Term Loan” and “Term Loan Agreement”), as Borrower with certain subsidiaries of the Company, acting as guarantors of debt. Principal may be prepaid at any time during the term of the Term Loan without penalty. The Company incurred $2.0 million of debt issuance costs related to the Term Loan.

The Term Loan Agreement allows for incremental facilities in an aggregate amount of up to $125.0 million. Any such incremental facilities are subject to receiving additional commitments from lenders and certain other customary conditions. The Term Loan agreement requires quarterly payments of 0.25% of the original principal balance, with remaining principal payable at maturity, April 25, 2022.

The lenders under the Term Loan have a second priority security interest in substantially all accounts receivable and inventory of the Company.

The following amendments have been made to the Term Loan:

•

On July 18, 2018, the Company exercised a $50.0 million incremental commitment option under the Term Loan Agreement, which increased total borrowing under the facility from $75.0 million to $125.0 million. The Company incurred an additional $0.6 million of debt issuance costs related to the incremental commitment option under the Term Loan. Proceeds from the incremental commitment were used to repay a portion of the outstanding borrowings under the April 2017 ABL Facility.

•

On March 29, 2019, the Company exercised a $50.0 million incremental commitment option under the Term Loan Agreement, which increased total borrowing under the facility from $125.0 million to $175.0 million. The Company incurred an additional $0.8 million of debt issuance costs related to the incremental commitment option under the Term Loan, which were deducted from proceeds received by the Company. Proceeds from the incremental commitment were used to repay a portion of the outstanding borrowings under the April 2017 ABL Facility.

•

On October 18, 2019, the Company amended the term loan agreement to raise the maximum leverage net ratio to 4.00 to 1.00 from 3.50 to 1.00. The ratio will decline by 25 basis points in the third quarter of each fiscal year after the amendment date, reaching a final maximum leverage ratio of 3.50 to 1.00 on July 31, 2021. Additionally, the Company received a waiver related to the excess cash flow calculation payment for fiscal year 2019. The Company incurred $0.2 million of debt issuance costs related to the amendment.

•

On January 31, 2020, the Company amended the term loan agreement, in contemplation of its pending acquisition of Spartan ER, to raise the maximum net leverage ratio to 5.00 to 1.00 from 4.00 to 1.00. The ratio will decline by 25 basis points in the fourth quarter of fiscal year 2020, and each fiscal quarter ending thereafter, reaching a final maximum leverage ratio of 3.75 to 1.00 on October 31, 2021. The Company incurred $0.4 million of debt issuance costs related to this amendment.

•

On April 29, 2020, the Company amended the term loan agreement to eliminate the maximum leverage ratio covenant and replace it with a fixed charge coverage ratio test with a minimum ratio of 1.25 to 1.00. The fixed charge coverage ratio covenant will remain in effect through the fourth quarter of fiscal year 2020. The maximum leverage ratio covenant will be reinstated at 5.25 to 1.00 starting in the first quarter of fiscal year 2021 and decline by 25 basis points each subsequent quarter, to a final level of 4.25 to 1.00 in first quarter of fiscal 2022. The applicable interest rate margins increased by 75 basis points corresponding with the amendment. The Company incurred $0.2 million of debt issuance costs related to the amendment.

Applicable interest rate margins for the Term Loan are 3.25% for base rate loans and 4.25% for Eurodollar rate loans (with the Eurodollar rate having a floor of 1.00%) as a result of the April 29, 2020 Term Loan amendment. Interest is payable quarterly for all base rate loans and is payable monthly or quarterly for all Eurodollar rate loans. The weighted-average interest rate on borrowings outstanding under the Term Loan was 5.25% as of July 31, 2020.

The Term Loan Agreement contains customary representations and warranties, affirmative and negative covenants, in each case, subject to customary limitations, exceptions and exclusions. The Term Loan Agreement also contains certain customary events of default.

The Company was in compliance with all financial covenants under the Term Loan as of July 31, 2020.

The fair value of the Term Loan approximated book value at both July 31, 2020 and October 31, 2019.

Note 10. Warranties

The Company’s products generally carry explicit warranties that extend from several months to several years, based on terms that are generally accepted in the marketplace. Selected components (such as engines, transmissions, tires, etc.) included in the Company’s end products may include warranties from original equipment manufacturers (“OEM”). These OEM warranties are passed on to the end customer of the Company’s products, and the customer deals directly with the applicable OEM for any issues encountered on those components.

Changes in the Company’s warranty liability consisted of the following:

	Nine Months Ended July 31,
	2020			2019
Balance at beginning of period	$	22.6		$	30.8
Warranty provisions		27.5			17.3
Settlements made		(25.8	)		(25.1	)
Warranties for current year acquisition		12.2			—
Divestiture adjustments		(0.7	)		—
Changes in liability of pre-existing warranties		(0.3	)		0.1
Balance at end of period	$	35.5		$	23.1

Accrued warranty is classified in the Company’s consolidated balance sheets as follows:

	July 31, 2020		October 31, 2019
Current liabilities	$	23.7	$	16.1
Other long-term liabilities		11.8		6.5
Total warranty liability	$	35.5	$	22.6

Note 11. Stock Repurchase Program

On March 20, 2018, the Company’s Board of Directors authorized up to $50.0 million of repurchases of the Company’s issued and outstanding common stock with an expiration date of March 19, 2020. On September 5, 2018, the Company’s Board of Directors authorized an additional $50.0 million of repurchases of the Company’s issued and outstanding common stock with an expiration date of September 4, 2020. The Company’s share repurchase program is executed from time to time through open market or through private transactions. Shares purchased under the share repurchase program are retired and returned to authorized and unissued status. During fiscal year 2019, the Company repurchased 717,597 shares under this repurchase program at a total cost of $8.3 million at an average price per share of $11.62. There were no repurchases under this program during the three and nine months ended July 31, 2020. As of July 31, 2020, the Company had $38.3 million of authorization remaining under this program. The Company is no longer permitted to repurchase stock under the provisions of our Term Loan, as amended on April 29, 2020, from the date of the amendment through the maturity of the Term Loan Agreement.

Note 12. Earnings Per Share

Basic earnings per common share (“EPS”) is computed by dividing net (loss) income by the weighted average number of common shares outstanding. Diluted EPS is computed by dividing net (loss) income by the weighted-average number of common shares outstanding assuming dilution. The difference between basic EPS and diluted EPS is the result of the dilutive effect of outstanding stock options, performance stock units and restricted stock units. The table below reconciles basic weighted-average common shares outstanding to diluted weighted-average shares outstanding for the three and nine months ended July 31, 2020 and July 31, 2019:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2020		2019		2020		2019
Basic weighted-average common shares outstanding		63,134,486		62,641,436		63,011,955		62,875,677
Dilutive stock options		—		273,717		—		—
Dilutive restricted stock units		—		509,452		—		—
Dilutive performance stock units		—		—		—		—
Diluted weighted-average common shares outstanding		63,134,486		63,424,605		63,011,955		62,875,677

The table below represents exclusions from the calculation of weighted-average shares outstanding assuming dilution due to the anti-dilutive effect of the common stock equivalents for the three and nine months ended July 31, 2020 and July 31, 2019:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2020		2019		2020		2019
Anti-dilutive stock options		627,600		48,951		779,600		988,551
Anti-dilutive restricted stock units		2,865,583		422,169		3,546,206		1,773,255
Anti-dilutive performance stock units		—		18,408		—		18,408
Anti-dilutive common stock equivalents		3,493,183		489,528		4,325,806		2,780,214

Note 13. Income Taxes

For interim financial reporting, the Company estimates its annual effective tax rate based on the projected income for its entire fiscal year and records a provision (benefit) for income taxes on a quarterly basis based on the estimated annual effective income tax rate, adjusted for any discrete tax items.

On March 27, 2020, the U.S. enacted the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”). The Cares Act is an emergency economic stimulus package that includes spending and tax benefits to strengthen the U.S. economy and fund a nationwide effort to curtail the effect of COVID-19. While the CARES Act provides sweeping tax changes in response to the COVID-19 pandemic, some of the more significant provisions include removal of certain limitations on utilization of net operating losses, allowing for net operating loss carrybacks for certain past and future losses, increasing the ability to deduct interest expense, as well as amending certain provisions of the previously enacted Tax Cuts and Jobs Act. The Company continued to evaluate the impact of the CARES Act during the quarter and recorded a cumulative tax benefit of $3.5 million for the carryback of the fiscal year 2018 federal net operating loss. As the Company is carrying the losses back to years beginning before January 1, 2018, the tax benefit of $3.5 million is a result of the rate differential between the previous 35% federal tax rate and current statutory rate of 21%.

The Company recorded income tax benefit of $0.5 million for the three months ended July 31, 2020, or 11.6% of pre-tax loss, compared to $1.9 million of expense, or 25.7% of pre-tax income, for the three months ended July 31, 2019. Results for the three months ended July 31, 2020 were unfavorably impacted by $0.8 million of net discrete tax expense primarily related to stock-based compensation tax deductions. Results for the three months ended July 31, 2019 were unfavorably impacted by $0.1 million of net discrete tax expenses primarily related to a federal provision-to-return adjustment.

The Company recorded income tax benefit of $13.2 million for the nine months ended July 31, 2020, or 39.4% of pre-tax loss, compared to less than $0.1 million of expense, or (0.2)% of pre-tax loss, for the nine months ended July 31, 2019. Results for the nine months ended July 31, 2020 were favorably impacted by $4.6 million of net discrete tax benefits primarily related to net operating loss carrybacks allowable under the CARES Act and the nontaxable gain on the acquisition of Spartan ER which were offset by the net discrete tax expense related to stock-based compensation tax deductions. Results for the nine months ended July 31, 2019 were unfavorably impacted by $0.8 million of net discrete expenses primarily related to stock-based compensation tax deductions.

The Company periodically evaluates its valuation allowance requirements as facts and circumstances change and may adjust its deferred tax asset valuation allowances accordingly. It is reasonably possible that the Company will either add to or reverse a portion

of its existing deferred tax asset valuation allowances in the future. Such changes in the deferred tax asset valuation allowances will be reflected in the current operations through the Company’s effective income tax rate. During the three and nine months ended July 31, 2020, there were no changes to the Company’s valuation allowances.

The Company’s liability for unrecognized tax benefits, including interest and penalties, was $2.8 million as of July 31, 2020 and $2.6 million as of October 31, 2019. The unrecognized tax benefits are presented in other long-term liabilities in the Company’s Condensed Unaudited Consolidated Balance Sheets for the period ended July 31, 2020. During the next twelve months, it is reasonably possible that $0.4 million of the unrecognized tax benefits, if recognized, would affect the annual effective income tax rate. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in its Condensed Unaudited Consolidated Statement of Operations.

The Company regularly assesses the likelihood of an adverse outcome resulting from examinations to determine the adequacy of its tax reserves. As of July 31, 2020, the Company believes that it is more likely than not that the tax positions it has taken will be sustained upon the resolution of its audits resulting in no material impact on its consolidated financial position and the results of operations and cash flows. However, the final determination with respect to any tax audits, and any related litigation, could be materially different from the Company’s estimates and/or from its historical income tax provisions and income tax liabilities and could have a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, and/or interest assessments related to income tax examinations.

Note 14. Commitments and Contingencies

Personal Injury Actions and Other: Product and general liability claims arise against the Company from time to time in the ordinary course of business. These claims are generally covered by third-party insurance. There is inherent uncertainty as to the eventual resolution of unsettled claims. Management, however, believes that any losses will not have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows.

Market Risks: The Company is contingently liable under bid, performance and specialty bonds and has open standby letters of credit issued by the Company’s banks in favor of third parties as follows:

	July 31, 2020		October 31, 2019
Performance, bid and specialty bonds	$	290.4	$	229.9
Open standby letters of credit		11.9		14.3
Total	$	302.3	$	244.2

The increase in performance, bid and specialty bonds is attributable to municipal contracts within our Commercial segment and customer contracts related to Spartan ER.

Chassis Contingent Liabilities: The Company obtains certain vehicle chassis from automobile manufacturers under converter pool agreements. These agreements generally provide that the manufacturer will supply chassis at the Company’s various production facilities under the terms and conditions set forth in the agreement. The manufacturer does not transfer the certificate of origin to the Company and, accordingly, the chassis are treated as consigned inventory of the automobile manufacturer. Upon being put into production, the Company becomes obligated to pay the manufacturer for the chassis. Chassis are typically converted and delivered to customers within 90 to 120 days of receipt. If the chassis are not converted within this timeframe of delivery, the Company generally purchases the chassis and records inventory, or the Company is obligated to begin paying an interest charge on this inventory until purchased. Such agreements are customary in the industries in which the Company operates and the Company’s exposure to loss under such agreements is limited by the value of the vehicles that would be repossessed and resold to mitigate any losses. The Company’s contingent liability under such agreements was $42.6 million and $48.6 million as of July 31, 2020 and October 31, 2019, respectively.

Repurchase Commitments: The Company has repurchase agreements with certain lending institutions. The repurchase commitments are on an individual unit basis with a term from the date it is financed by the lending institution through payment date by the dealer or other customer, generally not exceeding two years. The Company’s outstanding obligations under such agreements were $163.6 million and $212.5 million as of July 31, 2020, and October 31, 2019, respectively. This value represents the gross value of all vehicles under repurchase agreements and does not take into consideration proceeds that would be received upon resale of repossessed vehicles, which would be used to reduce the Company’s ultimate net liability. Such agreements are customary in the industries in which the Company operates and the Company’s exposure to loss under such agreements is limited by the potential loss on the resale value of the inventory which is required to be repurchased. Losses incurred under such arrangements have not been significant and the

Company expects this pattern to continue. The reserve for losses included in other liabilities on contracts outstanding at July 31, 2020 and October 31, 2019 is immaterial.

Guarantee Arrangements: The Company is party to multiple agreements whereby it guarantees indebtedness of others, including losses under loss pool agreements. The Company estimated that its maximum loss exposure under these contracts was $22.5 million and $25.5 million at July 31, 2020 and October 31, 2019, respectively. Under the terms of these and various related agreements and upon the occurrence of certain events, the Company generally has the ability to, among other things, take possession of the underlying collateral. If the financial condition of the customers and dealers were to deteriorate and result in their inability to make payments, then additional accruals may be required. While the Company does not expect to experience losses under these agreements that are materially in excess of the amounts reserved, it cannot provide any assurance that the financial condition of the third parties will not deteriorate resulting in the third party’s inability to meet their obligations.

In the event that third parties are unable to meet obligations under these agreements, the Company cannot guarantee that the collateral underlying the agreements will be available or sufficient to avoid losses materially in excess of the amounts reserved. Any losses under these guarantees would generally be mitigated by the value of any underlying collateral, primarily financed vehicles, and are generally subject to the finance company’s ability to provide the Company clear title to foreclosed equipment and other conditions. During periods of economic weakness, collateral values generally decline and can contribute to higher exposure to losses.

Other Matters: The Company is, from time to time, party to various legal proceedings arising out of ordinary course of business. The amount of alleged liability, if any, from these proceedings cannot be determined with certainty; however, the Company believes that its ultimate liability, if any, arising from pending legal proceedings, as well as from asserted legal claims and known potential legal claims, which are probable of assertion, taking into account established accruals for estimated liabilities, should not be material to the business, financial condition or results of operations.

A consolidated federal putative securities class action and a consolidated state putative securities class action are pending against the Company and certain of its officers and directors. These actions collectively purport to assert claims on behalf of putative classes of purchasers of the Company’s common stock in or traceable to its January 2017 IPO, purchasers in its secondary offering of common stock in October 2017, and purchasers from October 10, 2017 through June 7, 2018. The state action also names certain of the underwriters for the Company’s IPO or secondary offering as defendants. The federal and state courts each consolidated multiple separate actions pending before them, the first of which was filed on June 8, 2018. The actions have alleged certain violations of the Securities Act of 1933 and, for the federal action, the Securities Exchange Act of 1934. The consolidated state action is currently stayed in favor of the consolidated federal action.

Collectively, the actions seek certification of the putative classes asserted and compensatory damages and attorneys’ fees and costs. The underwriter defendants have notified the Company of their intent to seek indemnification from the Company pursuant to the IPO underwriting agreement regarding the claims asserted with respect to the IPO, and the Company expects the underwriters to do the same in regard to the claims asserted with respect to the October 2017 offering. Two purported derivative actions, which have since been consolidated, were also filed in federal court in Delaware in 2019 against the Company’s directors (with the Company as a nominal defendant), premised on allegations similar to those asserted in the consolidated federal securities litigation. The Company and the other defendants intend to defend these lawsuits vigorously. Additional lawsuits may be filed and, at this time, the Company is unable to predict the outcome of the lawsuits, the possible loss or range of loss, if any, associated with the resolution of the lawsuits, or any potential effect that it may have on the Company or its operations.

Note 15. Business Segment Information

The Company is organized into three reportable segments based on management’s process for making operating decisions, allocating capital and measuring performance, and based on the similarity of products, customers served, common use of facilities, and economic characteristics. The Company’s segments are as follows:

Fire & Emergency: This segment includes KME, E-One, Ferrara, Spartan ER, American Emergency Vehicles, Leader Emergency Vehicles, Horton Emergency Vehicles, REV Ambulance Orlando and REV Brazil. These business units manufacture and market commercial and custom fire and emergency vehicles primarily for fire departments, airports, other governmental units, contractors, hospitals and other care providers in the United States and other countries.

Commercial: This segment includes Collins Bus, ENC, Capacity and Lay-Mor. Collins Bus manufactures, markets and distributes school buses, normally referred to as Type A school buses. Capacity manufactures, markets and distributes trucks used in terminal type operations, i.e., rail yards, warehouses, rail terminals and shipping terminals/ports. Lay-Mor manufactures, markets and distributes industrial sweepers for both the commercial and rental markets. On May 8, 2020, the Company sold its shuttle bus

businesses which included Goshen Coach, ElDorado National (Kansas), Federal Coach, Champion and World Trans. Refer to Note 8, Divestiture Activities, for further details.

Recreation: This segment includes REV Recreation Group (“RRG”), Goldshield Fiberglass, Inc. (“Goldshield”), Renegade, Midwest and Lance, and their respective manufacturing facilities, service and parts divisions. RRG primarily manufactures, markets and distributes Class A RVs in both gas and diesel models. Renegade primarily manufacturers, markets and distributes Class C and “Super C” RVs. Midwest manufactures, markets and distributes Class B RVs and luxury vans. Lance manufactures, markets and distributes truck campers, towable campers and toy haulers. Goldshield manufactures, markets and distributes fiberglass reinforced molded parts to a diverse cross section of original equipment manufacturers and other commercial and industrial customers, including various components for RRG, which is one of Goldshield’s primary customers.

For purposes of measuring financial performance of its business segments, the Company does not allocate to individual business segments costs or items that are of a corporate nature. The caption “Corporate, Other & Elims” includes corporate office expenses, results of insignificant operations, intersegment eliminations and income and expense not allocated to reportable segments.

Total assets of the business segments exclude general corporate assets, which principally consist of cash and cash equivalents, certain property, plant and equipment and certain other assets pertaining to corporate and other centralized activities.

Intersegment sales generally include amounts invoiced by a segment for work performed for another segment. Amounts are based on actual work performed and agreed-upon pricing which is intended to be reflective of the contribution made by the supplying business segment. All intersegment transactions have been eliminated in consolidation.

Selected financial information of the Company’s segments is as follows:

	Three Months Ended July 31, 2020
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	306.7	$	92.4	$	182.7	$	0.4		$	582.2
Depreciation and amortization	$	3.1	$	1.1	$	3.4	$	1.6		$	9.2
Capital expenditures	$	1.0	$	0.3	$	0.2	$	0.5		$	2.0
Total assets	$	766.9	$	205.9	$	309.0	$	127.6		$	1,409.4
Adjusted EBITDA	$	12.9	$	10.3	$	12.1	$	(13.9	)

	Three Months Ended July 31, 2019
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	247.7	$	203.8	$	166.7	$	(1.2	)	$	617.0
Depreciation and amortization	$	3.6	$	2.0	$	3.6	$	1.7		$	10.9
Capital expenditures	$	1.8	$	1.4	$	0.6	$	0.9		$	4.7
Total assets	$	622.8	$	328.5	$	336.6	$	118.2		$	1,406.1
Adjusted EBITDA	$	12.1	$	19.4	$	12.8	$	(10.8	)

	Nine Months Ended July 31, 2020
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	802.4	$	393.8	$	463.6	$	1.5		$	1,661.3
Depreciation and amortization	$	10.2	$	4.7	$	10.2	$	5.8		$	30.9
Capital expenditures	$	5.0	$	1.7	$	1.6	$	1.4		$	9.7
Total assets	$	766.9	$	205.9	$	309.0	$	127.6		$	1,409.4
Adjusted EBITDA	$	25.1	$	28.1	$	17.9	$	(31.5	)

	Nine Months Ended July 31, 2019
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	699.0	$	514.5	$	542.6	$	(5.3	)	$	1,750.8
Depreciation and amortization	$	10.6	$	6.7	$	12.0	$	5.5		$	34.8
Capital expenditures	$	5.0	$	3.1	$	3.0	$	3.0		$	14.1
Total assets	$	622.8	$	328.5	$	336.6	$	118.2		$	1,406.1
Adjusted EBITDA	$	35.8	$	39.7	$	39.4	$	(32.2	)

In considering the financial performance of the business, the chief operating decision maker analyzes the primary financial performance measure of Adjusted EBITDA. Adjusted EBITDA is defined as net income for the relevant period before depreciation and amortization, interest expense and income taxes, as adjusted for items management believes are not indicative of the Company’s ongoing operating performance. Adjusted EBITDA is not a measure defined by U.S. GAAP but is computed using amounts that are determined in accordance with U.S. GAAP. A reconciliation of this performance measure to net income (loss) is included below.

The Company believes Adjusted EBITDA is useful to investors and used by management for measuring profitability because the measure excludes the impact of certain items which management believes have less bearing on the Company’s core operating performance, and allows for a more meaningful comparison of operating fundamentals between companies within its industries by eliminating the impact of capital structure and taxation differences between the companies. Additionally, Adjusted EBITDA is used by management to measure and report the Company’s financial performance to the Company’s Board of Directors, assists in providing a meaningful analysis of the Company’s operating performance and is used as a measurement in incentive compensation for management.

Provided below is a reconciliation of segment Adjusted EBITDA to net (loss) income:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2020			2019			2020			2019
Fire & Emergency Adjusted EBITDA	$	12.9		$	12.1		$	25.1		$	35.8
Commercial Adjusted EBITDA		10.3			19.4			28.1			39.7
Recreation Adjusted EBITDA		12.1			12.8			17.9			39.4
Corporate and Other Adjusted EBITDA		(13.9	)		(10.8	)		(31.5	)		(32.2	)
Depreciation and amortization		(9.2	)		(10.9	)		(30.9	)		(34.8	)
Interest expense, net		(5.7	)		(8.4	)		(20.3	)		(24.2	)
Benefit (provision) for income taxes		0.5			(1.9	)		13.2			—
Transaction expenses		(0.6	)		(0.5	)		(2.6	)		(0.7	)
Sponsor expense reimbursement		(0.1	)		—			(0.2	)		(0.6	)
Restructuring costs		(2.5	)		(1.3	)		(6.0	)		(4.2	)
Restructuring related charges		(0.7	)		—			(3.9	)		—
Stock-based compensation expense		(1.8	)		(2.5	)		(7.2	)		(7.3	)
Legal matters		(0.1	)		(0.8	)		(1.6	)		(5.3	)
Loss on sale of business		(0.5	)		—			(9.3	)		—
Gain on acquisition of business		—			—			11.9			—
Impairment charges		(3.7	)		—			(3.7	)		(2.8	)
(Losses) earnings attributable to assets held for sale		(0.6	)		(1.0	)		0.8			(3.3	)
Deferred purchase price payment		—			(0.6	)		(0.1	)		(2.8	)
Net (loss) income	$	(3.6	)	$	5.6		$	(20.3	)	$	(3.3	)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This management’s discussion and analysis should be read in conjunction with the Condensed Unaudited Consolidated Financial Statements and risk factors contained in this Form 10-Q as well as the Management’s Discussion and Analysis and Risk Factors and audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K filed on December 18, 2019.

Overview

REV is a leading designer, manufacturer, and distributor of specialty vehicles and related aftermarket parts and services. We serve a diversified customer base, primarily in the United States, through three segments: Fire & Emergency, Commercial, and Recreation. We provide customized vehicle solutions for applications, including essential needs for public services (ambulances, fire apparatus, school buses, and transit buses), commercial infrastructure (terminal trucks and industrial sweepers) and consumer leisure (recreational vehicles). Our diverse portfolio is made up of well-established principal vehicle brands, including many of the most recognizable names within their industry. Several of our brands pioneered their specialty vehicle product categories and date back more than 50 years. We believe that in most of our markets, we hold the first or second market share position and approximately 62% of our net sales during the third quarter of fiscal year 2020 came from products where we believe we hold such share positions.

Segments

We serve a diversified customer base primarily in the United States through the following segments:

Fire & Emergency – Our Fire & Emergency segment sells fire apparatus equipment under the Emergency One (E-ONE), Kovatch Mobile Equipment (KME), Ferrara, Spartan, Smeal and Ladder Tower brands, and ambulances under the American Emergency Vehicles (AEV), Horton Emergency Vehicles (HEV), Leader Emergency Vehicles (LEV), Marque, McCoy Miller, Road Rescue, Wheeled Coach and Frontline brands. We believe we are the largest manufacturer by unit volume of fire and emergency vehicles in the United States and have one of the industry’s broadest portfolios of products including Type I ambulances (aluminum body mounted on a heavy truck-style chassis), Type II ambulances (van conversion ambulance typically favored for non-emergency patient transportation), Type III ambulances (aluminum body mounted on a van-style chassis), pumpers (fire apparatus on a custom or commercial chassis with a water pump and small tank to extinguish fires), ladder trucks (fire apparatus with stainless steel or aluminum ladders), tanker trucks and rescue and other vehicles. Each of our individual brands is distinctly positioned and targets certain price and feature points in the market such that dealers often carry, and customers often buy more than one REV Fire & Emergency product line. On February 1, 2020, the Company acquired Spartan Emergency Response (“Spartan ER”), a leading designer, manufacturer and distributor of custom emergency response vehicles, cabs and chassis for the emergency response market.

Commercial – Our Commercial segment serves the bus and commercial markets through the following principal brands: Collins Bus, ENC, Capacity and Lay-Mor. Our products in the Commercial segment include transit buses (large municipal buses where we build our own chassis and body), Type A school buses (small school bus built on commercial chassis), street sweepers (three- and four-wheel versions used in road construction activities), and terminal trucks (specialized vehicles which move freight in warehouses or intermodal yards and ports). On May 8, 2020, the Company sold its shuttle bus businesses which included Goshen Coach, ElDorado National (Kansas), Federal Coach, Champion and World Trans. Refer to Note 8, Divestiture Activities, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

Recreation – Our Recreation segment serves the RV market through seven principal brands: American Coach, Fleetwood RV, Monaco Coach, Holiday Rambler, Renegade, Midwest and Lance. We believe our brand portfolio contains some of the longest standing, most recognized brands in the RV industry. Under these brands, REV provides a variety of highly recognized motorized and towable RV line-makes such as: American Eagle, Bounder, Pace Arrow, Verona, Weekender and Lance, among others. Our products in the Recreation segment include Class A motorized RVs (motorhomes built on a heavy duty chassis with either diesel or gas engine configurations), Class C and “Super C” motorized RVs (motorhomes built on a commercial truck or van chassis), Class B RVs (motorhomes built out on a van chassis), and towable travel trailers and truck campers. The Recreation segment also includes Goldshield Fiberglass, which produces a wide range of custom molded fiberglass products for the heavy-duty truck, RV and broader industrial markets.

Factors Affecting Our Performance

The primary factors affecting our results of operations include:

General Economic Conditions

Our business is impacted by the U.S. economic environment, employment levels, consumer confidence, municipal spending, municipal tax receipts, changes in interest rates and instability in securities markets around the world, among other factors. In particular, changes in the U.S. economic climate can impact demand in key end markets. In addition, the Company is susceptible to supply chain disruptions resulting from the impact of tariffs and global macro-economic factors (refer to “Impact of COVID-19” section below), which can have a dramatic effect, either directly or indirectly, on the availability, lead-times and costs associated with raw materials and parts.

RV purchases are discretionary in nature and therefore sensitive to the availability of financing, consumer confidence, unemployment levels, levels of disposable income and changing levels of consumer home equity, among other factors. RV markets are affected by general U.S. and global economic conditions, which create risks that future economic downturns will further reduce consumer demand and negatively impact our sales.

While less economically sensitive than the Recreation segment, the Fire & Emergency segment and the Commercial segment are also impacted by the overall economic environment. Local tax revenues are an important source of funding for fire and emergency response departments. Fire and emergency products and buses are typically a larger cost item for municipalities and their service life is relatively long, making the purchase more deferrable, which can result in reduced demand for our products. In addition to commercial demand, local, state and federal tax revenues can be an important source of funding for many of our bus products including Type A school buses and transit buses. Volatility in tax revenues or availability of funds via budgetary appropriation can have a negative impact on the demand for these products.

A decrease in employment levels, consumer confidence or the availability of financing, or other adverse economic events, or the failure of actual demand for our products to meet our estimates, could negatively affect the demand for our products. Any decline in overall customer demand in markets in which we operate could have a material adverse effect on our operating performance.

Seasonality

In a typical year, our operating results are impacted by seasonality. Historically, the slowest quarters have been the first and second fiscal quarters when the purchasing seasons for vehicles, such as school buses, RVs and sweepers are the lowest due to the colder weather and the relatively long time until the summer vacation season, and the fact that the school year is underway with municipalities and school bus contractors utilizing their existing fleets to transport student populations. Sales of our products have typically been higher in the third and fourth fiscal quarters (with the fourth fiscal quarter typically being the strongest) due to better weather, the vacation season, buying habits of RV dealers and end-users, timing of government/municipal customer fiscal years, and the beginning of a new school year. Our quarterly results of operations, cash flows, and liquidity are likely to be impacted by these seasonal patterns. Sales and earnings for other vehicles that we produce, such as essential emergency vehicles and commercial bus fleets, are less seasonal, but fluctuations in sales of these vehicles can also be impacted by timing surrounding the fiscal years of municipalities and commercial customers, as well as the timing and amounts of multi-unit orders.

Impact of Acquisitions

We actively evaluate opportunities to improve and expand our business through targeted acquisitions that are consistent with our strategy. On occasion, we also may dispose of certain components of our business that no longer fit within our overall strategy. Historically, a significant component of our growth has been through acquisitions of businesses. We typically incur upfront costs as we integrate acquired businesses and implement our operating philosophy at newly acquired companies, including consolidation of supplies and materials, purchases, improvements to production processes, and other restructuring initiatives. The benefits of these integration efforts and divestiture activities may not positively impact our financial results until subsequent periods.

We recognize acquired assets and liabilities at fair value. This includes the recognition of identified intangible assets and goodwill which, in the case of definite-life intangible assets, are then amortized over their expected useful lives, which typically results in an increase in amortization expense. In addition, assets acquired and liabilities assumed generally include tangible assets as well as contingent assets and liabilities.

On February 1, 2020, the Company acquired Spartan ER, a leading designer, manufacturer and distributor of custom emergency response vehicles, cabs and chassis for the emergency response market. Refer to Note 4, Acquisition, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

On May 8, 2020, the Company sold its shuttle bus businesses. Refer to Note 8, Divestiture Activities, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

Impact of COVID-19

During our second quarter of fiscal year 2020, the novel coronavirus known as "COVID-19" spread throughout the world creating a global pandemic. The pandemic triggered a significant downturn in global commerce and these challenging market conditions may continue for an extended period of time. As a result of the spread of COVID-19, we have also experienced disruption and delays in our supply chain, customer demand, and logistics challenges, including our customers’ ability to inspect and take delivery of vehicles.

Many of the vehicles and parts we supply are vital to serving communities across our nation. The Cybersecurity and Infrastructure Security Agency (CISA), which implements the Secretary of Homeland Security’s responsibilities, has designated our fire trucks, ambulances, transit and school buses and terminal trucks (representing roughly 70% of the vehicles we produce) as essential to the nation’s health and safety, and are critical to the emergency service and transportation infrastructure.

We have taken a number of precautionary steps to safeguard our employees and our business from the effects of the outbreak of COVID-19, including closing Recreation vehicle manufacturing locations for 3-6 weeks and shuttle bus manufacturing locations for 2 weeks (during the second quarter of fiscal year 2020), substantially limiting the presence of personnel in our offices and manufacturing locations, implementing travel restrictions and withdrawing from various industry events. We have requested that office employees work from home and implemented business continuity plans in an effort to minimize further business disruption, protect our employees and operations. In addition, we have limited discretionary spending, furloughed salaried employees, deferred capital investments, suspended future quarterly dividends, replaced our Term Loan debt leverage ratio covenant with a fixed charge coverage ratio through fiscal 2020, and temporarily lowered the salaries of our leadership team.

While the global market downturn, closures and limitations on movement are expected to be temporary, the duration of any demand reductions, production and supply chain disruptions, and related financial impacts, cannot be reliably estimated at this time.

Results of Operations

	Three Months Ended July 31,					Nine Months Ended July 31,
($ in millions)	2020			2019		2020			2019
Net sales	$	582.2		$	617.0	$	1,661.3		$	1,750.8
Gross profit		66.5			71.3		166.3			190.1
Selling, general and administrative		53.5			48.9		157.6			145.3
Restructuring		2.5			1.3		6.0			4.2
Loss on sale of business		0.5			—		9.3			—
Gain on acquisition of business		—			—		(11.9	)		—
(Benefit) provision for income taxes		(0.5	)		1.9		(13.2	)		—
Net (loss) income		(3.6	)		5.6		(20.3	)		(3.3	)

Adjusted EBITDA	$	21.4		$	33.5	$	39.6		$	82.7
Adjusted Net Income (Loss)	$	6.3		$	13.6	$	(2.5	)	$	26.6

Net Sales. Consolidated net sales were $582.2 million for the three months ended July 31, 2020, a decrease of $34.8 million, or 5.6%, from $617.0 million for the three months ended July 31, 2019. Net sales for the quarter included $74.5 million of revenue attributable to Spartan ER which was acquired on February 1, 2020. Net sales for the prior year quarter included $54.6 million of revenue attributable to the shuttle bus businesses which were sold on May 8, 2020. See to Note 8, Divestiture Activities, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details. Excluding the impact of Spartan ER and the shuttle bus divestiture, net sales decreased by $55.0 million, or 9.8% compared to the prior year quarter. The organic decrease in sales volume was primarily related to reductions in school bus, municipal bus, street sweeper and terminal truck shipments in the Commercial segment. The decrease in organic sales volume in the F&E segment was primarily due to lower shipments of ambulance units partially offset by an increase in shipments of fire apparatus. These segment decreases were partially offset by an increase in shipments in the Recreation segment driven by strong wholesale shipments and retail demand for RV’s.

Consolidated net sales were $1,661.3 million for the nine months ended July 31, 2020, a decrease of $89.5 million, or 5.1%, from $1,750.8 million for the nine months ended July 31, 2019. Net sales for the nine months ended July 31, 2020, included $137.1 million of revenue attributable to Spartan ER acquired on February 1, 2020, and $95.8 million of revenue attributable to shuttle bus businesses which were sold on May 8, 2020. Net sales for the prior year period included $155.6 million of revenue attributable to the shuttle bus businesses. Excluding the impact of Spartan ER and the shuttle bus divestiture, net sales decreased by $166.8 million, or 10.5% compared to the prior year period. The decrease in organic net sales was primarily due to a decrease in volume of shipments during the second quarter of fiscal year 2020 due to the impacts from the temporary plant shutdowns related to COVID-19.

Gross Profit. Consolidated gross profit was $66.5 million for the three months ended July 31, 2020, compared to $71.3 million for the three months ended July 31, 2019. Consolidated gross profit, as a percentage of consolidated net sales, was 11.4% for the three months ended July 31, 2020, a decrease compared to 11.6% for the three months ended July 31, 2019. The decrease in gross profit was primarily attributable to lower volume of shipments.

Consolidated gross profit was $166.3 million for the nine months ended July 31, 2020, compared to $190.1 million for the nine months ended July 31, 2019. Consolidated gross profit, as a percentage of consolidated net sales, was 10.0% for the nine months ended July 31, 2020, a decrease compared to 10.9% for the nine months ended July 31, 2019. The decrease in gross profit was primarily attributable to lower volume of shipments and COVID-19 related inefficiencies, partially offset by improved pricing.

Selling, General and Administrative. Consolidated selling, general and administrative (“SG&A”) costs were $53.5 million for the three months ended July 31, 2020, an increase of $4.6 million, or 9.4%, from consolidated SG&A costs of $48.9 million for the three months ended July 31, 2019. The increase in SG&A costs for the three months ended July 31, 2020 was primarily due to the acquisition of Spartan ER.

Consolidated SG&A costs were $157.6 million for the nine months ended July 31, 2020, an increase of $12.3 million, or 8.5%, from consolidated SG&A costs of $145.3 million for the nine months ended July 31, 2019. The increase in SG&A costs for the nine months ended July 31, 2020, was primarily due to the acquisition of Spartan ER and higher restructuring related costs associated with changes in leadership.

Restructuring. Consolidated restructuring costs were $2.5 million for the three months ended July 31, 2020, compared to $1.3 million for the three months ended July 31, 2019. The increase in restructuring costs for the three months ended July 31, 2020, was primarily related to headcount reductions in Corporate & Other and the F&E segments.

Consolidated restructuring costs were $6.0 million for the nine months ended July 31, 2020, compared to $4.2 million for the nine months ended July 31, 2019. The increase in restructuring costs for the nine months ended July 31, 2020, was primarily related to headcount reductions in Corporate & Other and the F&E segments, as well as lease termination costs related to the closure of a Spartan ER facility.

Loss on Sale of Business. Effective May 8, 2020, we completed the sale of our shuttle bus businesses for $48.9 million in cash. As a result, we recorded a loss on sale of $0.5 million and $9.3 million during the three and nine months ended July 31, 2020, respectively. Refer to Note 8, Divestiture Activities, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

Gain on Acquisition of Business. During the second quarter of fiscal year 2020, we recorded the preliminary purchase accounting for the acquisition of Spartan ER, which resulted in a gain on acquisition of $11.9 million. Refer to Note 4, Acquisition, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

(Benefit) Provision for Income Taxes. Consolidated income tax benefit of $0.5 million for the three months ended July 31, 2020, or 11.6% of pre-tax loss, compared to $1.9 million of expense, or 25.7% of pre-tax income, for the three months ended July 31, 2019. Results for the three months ended July 31, 2020 were unfavorably impacted by $0.8 million of net discrete tax expense primarily related to stock-based compensation tax deductions. Results for the three months ended July 31, 2019 were unfavorably impacted by $0.1 million of net discrete tax expenses primarily related to a federal provision-to-return adjustment.

Consolidated income tax benefit of $13.2 million for the nine months ended July 31, 2020, or 39.4% of pre-tax loss, compared to less than $0.1 million of expense, or (0.2)% of pre-tax loss, for the nine months ended July 31, 2019. Results for the nine months ended July 31, 2020 were favorably impacted by $4.6 million of net discrete tax benefits primarily related to net operating loss carrybacks allowable under the CARES Act and the nontaxable gain on the acquisition of Spartan ER, which were offset by the net discrete tax expense related to stock-based compensation tax deductions. Results for the nine months ended July 31, 2019 were unfavorably impacted by $0.8 million of net discrete expenses primarily related to stock-based compensation tax deductions.

Net (Loss) Income. Consolidated net loss was $3.6 million for the three months ended July 31, 2020, a decrease of $9.2 million, or 164.3%, from consolidated net income of $5.6 million for the three months ended July 31, 2019. The decrease was primarily due to the decrease in operating income, partially offset by lower interest expense.

Consolidated net loss was $20.3 million for the nine months ended July 31, 2020, an increase of $17.0 million, or 515.2%, from a net loss of $3.3 million for the nine months ended July 31, 2019. The increase in loss was primarily due to the decrease in operating income and the loss on the sale of the shuttle bus businesses, partially offset by the gain on acquisition of Spartan ER, lower interest expense and income tax expense.

Refer to Adjusted EBITDA and Adjusted Net Income section of “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Quarterly Report on Form 10-Q for a reconciliation of Net (Loss) Income to Adjusted EBITDA tables and related footnotes.

Fire & Emergency Segment

	Three Months Ended July 31,						Nine Months Ended July 31,
($ in millions)	2020			2019			2020			2019
Net sales	$	306.7		$	247.7		$	802.4		$	699.0
Adjusted EBITDA		12.9			12.1			25.1			35.8
Adjusted EBITDA % of net sales		4.2	%		4.9	%		3.1	%		5.1	%

Fire & Emergency segment net sales were $306.7 million for the three months ended July 31, 2020, an increase of $59.0 million, or 23.8%, from $247.7 million for the three months ended July 31, 2019. The increase in net sales compared to the prior year quarter was primarily due to net sales of Spartan ER, which was acquired on February 1, 2020 and increased throughput at one large fire plant. Excluding the impact of Spartan ER, net sales decreased by $15.5 million, or 6.3% compared to the prior year quarter. The decrease in sales was primarily related to lower shipments of ambulance units related to fewer orders for buildable stock units, supply chain disruptions and labor inefficiencies due to lingering impacts from COVID-19.

Fire & Emergency segment net sales were $802.4 million for the nine months ended July 31, 2020, an increase of $103.4 million, or 14.8%, from $699.0 million for the nine months ended July 31, 2019. The increase in net sales compared to the prior year period was primarily due to the net sales of Spartan ER, which was acquired on February 1, 2020. Excluding the impact of Spartan ER, Fire & Emergency net sales decreased by $33.7 million, or 4.8% compared to the prior year period. The decrease in sales was primarily related to the timing of shipments of fire apparatus and lower shipments of ambulance units related to fewer orders for buildable stock units, supply chain disruptions and labor inefficiencies due to lingering impacts from COVID-19.

Fire & Emergency segment Adjusted EBITDA was $12.9 million for the three months ended July 31, 2020, an increase of $0.8 million, or 6.6%, from $12.1 million for the three months ended July 31, 2019. Spartan ER contributed $5.0 million of Adjusted EBITDA during the third quarter of fiscal year 2020. Excluding the impact of Spartan ER, Fire & Emergency Adjusted EBITDA decreased by $4.2 million, or 34.7% compared to the prior year quarter. Third quarter profitability in the Fire & Emergency segment was negatively impacted primarily by labor inefficiencies within the Ambulance division caused by absenteeism and supply chain disruption related to lingering impacts of COVID-19 and lower unit production, partially offset by increased efficiency at a large fire plant and favorable mix of fire apparatus shipments.

Fire & Emergency segment Adjusted EBITDA was $25.1 million for the nine months ended July 31, 2020, a decrease of $10.7 million, or 29.9%, from $35.8 million for the nine months ended July 31, 2019. Spartan ER contributed $8.4 million of Adjusted EBITDA during the nine months ended July 31, 2020. Excluding the impact of Spartan ER, Fire & Emergency Adjusted EBITDA decreased by $19.1 million, or 53.4% compared to the prior year period. The decrease in profitability compared to the prior year period was primarily inefficiencies at two fire plants, the timing of deliveries of fire apparatus, absenteeism, and supply chain disruption within the Ambulance division related to COVID-19, partially offset by increased efficiency at a large fire plant.

Commercial Segment

	Three Months Ended July 31,						Nine Months Ended July 31,
($ in millions)	2020			2019			2020			2019
Net sales	$	92.4		$	203.8		$	393.8		$	514.5
Adjusted EBITDA		10.3			19.4			28.1			39.7
Adjusted EBITDA % of net sales		11.1	%		9.5	%		7.1	%		7.7	%

Commercial segment net sales were $92.4 million for the three months ended July 31, 2020, a decrease of $111.4 million, or 54.7%, from $203.8 million for the three months ended July 31, 2019. The decrease in net sales compared to the prior year quarter was primarily due to net sales of our shuttle bus businesses, which were sold on May 8, 2020. Excluding the impact of the shuttle bus divestiture, net sales decreased by $57.1 million, or 38.3% compared to the prior year quarter. The decrease in net sales was primarily due to fewer shipments of school buses, municipal transit buses, street sweepers and terminal trucks.

Commercial segment net sales were $393.8 million for the nine months ended July 31, 2020, a decrease of $120.7 million, or 23.5%, from $514.5 million for the nine months ended July 31, 2019. The decrease in net sales compared to the prior year period was primarily due to net sales of our shuttle bus businesses, which were sold on May 8, 2020. Excluding the impact of the shuttle bus divestiture, net sales decreased by $60.9 million, or 17.0% compared to the prior year period. The decrease in net sales was primarily due to lower shipments of school buses related to uncertainty surrounding school attendance policies, lower shipments of street sweepers related to reduced capital budgets at large customers and lower shipments of terminal trucks, partially offset by increased shipments of municipal transit buses.

Commercial segment Adjusted EBITDA was $10.3 million for the three months ended July 31, 2020, a decrease of $9.1 million, or 46.9%, from $19.4 million for the three months ended July 31, 2019. Adjusted EBITDA for the prior year quarter included $1.0 million of profitability attributable to the shuttle bus businesses which were sold on May 8, 2020. Excluding the impact of the shuttle bus divestiture, Adjusted EBITDA decreased by $8.2 million, or 44.6% compared to the prior year quarter. The decrease in Adjusted EBITDA compared to the prior year quarter was primarily due to reduced shipments of school buses, municipal transit buses, street sweepers and terminal trucks within the quarter.

Commercial segment Adjusted EBITDA was $28.1 million for the nine months ended July 31, 2020, a decrease of $11.6 million, or 29.2%, from $39.7 million for the nine months ended July 31, 2019. Adjusted EBITDA for the prior year period included $1.0 million of profitability attributable to the shuttle bus businesses which were sold on May 8, 2020. Excluding the impact of the shuttle bus divestiture, Adjusted EBITDA decreased by $11.2 million, or 28.9% compared to the prior year period. The decrease in Adjusted EBITDA compared to the prior year period was primarily due to the reduced shipment volumes of school buses, terminal trucks and street sweepers partially offset by increased shipments of municipal transit buses.

Recreation Segment

	Three Months Ended July 31,						Nine Months Ended July 31,
($ in millions)	2020			2019			2020			2019
Net sales	$	182.7		$	166.7		$	463.6		$	542.6
Adjusted EBITDA		12.1			12.8			17.9			39.4
Adjusted EBITDA % of net sales		6.6	%		7.7	%		3.9	%		7.3	%

Recreation segment net sales were $182.7 million for the three months ended July 31, 2020, an increase of $16.0 million, or 9.6%, from $166.7 million for the three months ended July 31, 2019. The increase in net sales compared to the prior year quarter was primarily due to an increase in shipments of motorized Class A, Class B and Super C RV’s driven by strong wholesale shipments and retail demand, partially offset by a decrease in non-motorized units.

Recreation segment net sales were $463.6 million for the nine months ended July 31, 2020, a decrease of $79.0 million, or 14.6%, from $542.6 million for the nine months ended July 31, 2019. The decrease in net sales compared to the prior year period was primarily due to previously announced manufacturing shutdowns, decline of dealer foot traffic and retail sales during COVID-19 Stay-At-Home orders, primarily within the second quarter of fiscal year 2020.

Recreation segment Adjusted EBITDA was $12.1 million for the three months ended July 31, 2020, a decrease of $0.7 million, or 5.5%, from $12.8 million for the three months ended July 31, 2019. The reduction in profitability was primarily due to a COVID-19

related shutdown that extended into the quarter at a plant in California, lingering supply chain disruptions and lower sales into challenged end markets at a fiberglass plant which impacted profitability compared to the prior year.

Recreation segment Adjusted EBITDA was $17.9 million for the nine months ended July 31, 2020, a decrease of $21.5 million, or 54.6%, from $39.4 million for the nine months ended July 31, 2019. The decrease in Adjusted EBITDA compared to the prior year period was primarily due to lower shipments across most product categories due to temporary shutdowns of all Recreation businesses during the COVID-19 Stay-At-Home orders during the second quarter of fiscal year 2020 and lingering supply chain disruptions.

Backlog

Backlog represents firm orders received from dealers or directly from end customers. Backlog does not include purchase options or verbal orders. The following table presents a summary of our backlog by segment:


($ in millions)	July 31, 2020		April 30, 2020		January 31, 2020		July 31, 2019
Fire & Emergency	$	1,039.7	$	1,111.7	$	807.3	$	775.7
Commercial		300.5		413.2		455.6		395.3
Recreation		327.8		122.9		158.3		129.7
Total Backlog	$	1,668.0	$	1,647.8	$	1,421.2	$	1,300.7

Each of our three segments has a backlog of new vehicle orders that generally extends out from two to twelve months in duration.

Orders from our dealers and end customers are evidenced by a contract, firm purchase order or reserved production slot for delivery of one or many vehicles. These orders are reported in our backlog at the aggregate selling prices, net of discounts or allowances.

As of July 31, 2020, our backlog was $1,668.0 million compared to $1,647.8 million as of April 30, 2020. The decrease in Fire & Emergency backlog was primarily due to improved throughput at a large fire plant which has shortened the duration of backlog and increased deliveries of completed fire trucks upon physical inspections that had been delayed during COVID-19 travel restrictions. The decrease in Commercial backlog was primarily the result of divested shuttle bus backlog as well as lower school bus, municipal transit and street sweeper orders. The increase in Recreation backlog was the result of strong order intake across all product categories.

As of July 31, 2020, our backlog was $1,668.0 million compared to $1,300.7 million as of July 31, 2019. The increase in Fire & Emergency backlog was primarily due to the acquisition of Spartan ER and strong Ambulance order intake over the trailing twelve months, partially offset by improved throughput at a large fire plant which has lowered backlog duration. The decrease in Commercial backlog was primarily the result of divested shuttle bus backlog as well as lower school bus, street sweeper and terminal truck orders partially offset by an increase of municipal truck orders. The increase in Recreation backlog was the result strong order intake across all product categories.

Liquidity and Capital Resources

General

Our primary requirements for liquidity and capital are working capital, the improvement and expansion of existing manufacturing facilities, debt service payments and general corporate needs. Historically, these cash requirements have been met through cash provided by operating activities, cash and cash equivalents and borrowings under our term loan and ABL credit facility.

We believe that our sources of liquidity and capital will be sufficient to finance our continued operations, growth strategy and additional expenses we expect to continue to incur as a public company. However, we cannot assure you that cash provided by operating activities and borrowings under the current revolving credit facility will be sufficient to meet our future needs. If we are unable to generate sufficient cash flows from operations in the future, and if availability under the current revolving credit facility is not sufficient due to the size of our borrowing base or other external factors, we may have to obtain additional financing. If additional capital is obtained by issuing equity, the interests of our existing stockholders will be diluted. If we incur additional indebtedness, that indebtedness may contain financial and other covenants that may significantly restrict our operations or may involve higher overall interest rates. We cannot assure you that we will be able to obtain refinancing or additional financing on favorable terms or at all.

Cash Flow

The following table shows summary cash flows for the nine months ended July 31, 2020 and July 31, 2019:

	Nine Months Ended July 31,
($ in millions)	2020			2019
Net cash provided by operating activities	$	25.0		$	22.0
Net cash (used in) provided by investing activities		(10.2	)		5.5
Net cash used in financing activities		(0.8	)		(19.6	)
Net increase in cash and cash equivalents	$	14.0		$	7.9

Net Cash Provided by Operating Activities

Net cash provided by operating activities for the nine months ended July 31, 2020 was $25.0 million, compared $22.0 million for the nine months ended July 31, 2019. The generation of positive cash from operating activities for the nine months ended July 31, 2020, was related to improved net working capital efficiency, specifically related to inventory.

Net Cash (Used in) Provided by Investing Activities

Net cash used in investing activities for the nine months ended July 31, 2020 was $10.2 million, compared to net cash provided by investing activities of $5.5 million for the nine months ended July 31, 2019. The increase in net cash used in investing activities for the nine months ended July 31, 2020, compared to the prior year period, was due to the acquisition of Spartan ER on February 1, 2020, net of proceeds from the sale of our shuttle bus businesses on May 8, 2020 and a decrease in proceeds from sales of other assets, partially offset by a reduction in capital expenditures.

Net Cash Used in Financing Activities

Net cash used in financing activities for the nine months ended July 31, 2020 was $0.8 million, which primarily consisted of net borrowings to fund the acquisition of Spartan ER and to pay quarterly dividends, offset by repayment of long-term debt. Net cash used in financing activities for the nine months ended July 31, 2019 was $29.1 million, which primarily consisted of net borrowings to fund working capital requirements and to repay long-term debt, to repurchase the Company’s common stock and to pay quarterly dividends.

Dividends

Subject to legally available funds and the discretion of our board of directors, we may or may not pay a quarterly cash dividend in the future on our common stock. During the nine months ended July 31, 2020, the Company paid cash dividends of $9.5 million. Our ability to pay dividends is limited under our Term Loan agreement, as amended on April 29, 2020. In order to pay dividends, the Company must have a leverage ratio, including the impact of the dividend, not to exceed 3.5 to 1.0. As a result, the Company announced the suspension of its quarterly dividend beginning the second quarter of fiscal year 2020 and will reassess at a future date.

Stock Repurchase Program

On March 20, 2018, the Company’s Board of Directors authorized up to $50.0 million of repurchases of the Company’s issued and outstanding common stock with an expiration date of March 19, 2020. On September 5, 2018, the Company’s Board of Directors authorized an additional $50.0 million of repurchases of the Company’s issued and outstanding common stock with an expiration date of September 4, 2020. The Company’s share repurchase program was executed from time to time through open market or through private transactions. Shares purchased under the share repurchase program were retired and returned to authorized and unissued status. During fiscal year 2018, the Company repurchased 3,233,352 shares under this repurchase program at a total cost of $53.3 million at an average price per share of $16.47. During fiscal year 2019, the Company repurchased 717,597 shares under this repurchase program at a total cost of $8.3 million at an average price per share of $11.62. There were no repurchases under this program during the three and nine months ended July 31, 2020. The Company is no longer permitted to repurchase stock under the provisions of our Term Loan, as amended on April 29, 2020, from the date of the amendment through the maturity of the Term Loan Agreement.

Term Loan

On April 25, 2017, we entered into a $75.0 million term loan (“Term Loan” or “Term Loan Agreement”), as Borrower, certain subsidiaries of the Company, as Guarantor Subsidiaries. Principal may be prepaid at any time during the term of the Term Loan without penalty. The Company incurred $2.0 million in debt issuance costs related to the Term Loan. The Term Loan Agreement expires on April 25, 2022.

On July 18, 2018, the Company exercised its $50.0 million incremental commitment option under the Term Loan Agreement, which increased total borrowing under the facility from $75.0 million to $125.0 million. The Company incurred an additional $0.6 million of debt issuance costs related to the incremental commitment option under the Term Loan. Proceeds from the increase in the Term Loan were used to repay a portion of the borrowings under the April 2017 ABL Facility.

On March 29, 2019, the Company exercised a $50.0 million incremental commitment option under the Term Loan Agreement, which increased total borrowing under the facility from $125.0 million to $175.0 million. The Company incurred an additional $0.8 million of debt issuance costs related to the incremental commitment option under the Term Loan. Proceeds from the incremental commitment were used to repay a portion of the outstanding borrowings under the April 2017 ABL Facility.

On October 18, 2019, the Company amended the term loan agreement to raise the maximum net leverage ratio to 4.00 to 1.00 from 3.50 to 1.00. The ratio will decline by 25 basis points in the third quarter of each fiscal year after the amendment date, reaching a final maximum leverage ratio of 3.50 to 1.00 on July 31, 2021. Additionally, the Company received a waiver related to the excess cash flow calculation payment for fiscal year 2019. The Company incurred $0.2 million of debt issuance costs related to the amendment raising the maximum leverage ratio and the waiver for the excess cash flow calculation payment under the Term Loan Agreement.

On April 29, 2020, the Company amended the term loan agreement to eliminate the maximum leverage ratio covenant and replace it with a fixed charge coverage ratio test with a minimum ratio of 1.25 to 1.00. The fixed charge coverage ratio covenant will remain in effect through of the fourth quarter of fiscal year 2020. The maximum leverage ratio covenant will be reinstated at 5.25 to 1.00 starting in the first quarter of fiscal year 2021, and decline by 25 basis points each subsequent quarter, to a final level of 4.25 to 1.00 in first quarter of fiscal 2022. The applicable interest rate margins increased by 75 basis points corresponding with the amendment. The Company incurred $0.2 million of debt issuance costs related to the amendment.

The Company may voluntarily prepay principal, in whole or in part, at any time, without penalty. Commencing with fiscal year 2018 and payable in fiscal year 2019, the Company is obligated to prepay certain minimum amounts based on the Company’s excess cash flow, as defined in the Term Loan Agreement. The Term Loan is also subject to mandatory prepayment if the Company or any of its restricted subsidiaries receives proceeds from certain events, including certain asset sales and casualty events, and the issuance of certain debt and equity interests.

The Term Loan Agreement contains certain financial covenants. The Company was in compliance with all financial covenants under the Term Loan as of July 31, 2020.

April 2017 ABL Facility

On April 25, 2017, we entered into a new $350.0 million revolving credit and guaranty agreement (the “April 2017 ABL Facility” or “ABL Agreement”) with a syndicate of lenders. The April 2017 ABL Facility provides for revolving loans and letters of credit in an aggregate amount of up to $350.0 million. The total April 2017 ABL Facility is subject to a $30.0 million sublimit for swing line loans and a $35.0 million sublimit for letters of credit, along with certain borrowing base and other customary restrictions as defined in the ABL Agreement. The April 2017 ABL Facility expires on April 25, 2022.

On December 22, 2017, the Company exercised its $100.0 million incremental commitment option under the April 2017 ABL Facility to fund the Lance Camper acquisition, which increased the facility to $450.0 million.

Principal may be repaid at any time during the term of the ABL Facility without penalty.

The April 2017 ABL Facility contains certain financial covenants. We were in compliance with all financial covenants under the ABL Facility as of July 31, 2020. As of July 31, 2020, our availability under the April 2017 ABL Facility was $220.6 million.

Refer to Note 9, Long-Term Debt, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

Adjusted EBITDA and Adjusted Net Income

In considering the financial performance of the business, management analyzes the primary financial performance measures of Adjusted EBITDA and Adjusted Net Income. Adjusted EBITDA is defined as net income for the relevant period before depreciation and amortization, interest expense and provision for income taxes, as adjusted for certain items described below that we believe are not indicative of our ongoing operating performance. Adjusted Net Income is defined as net income, as adjusted for certain items described below that we believe are not indicative of our ongoing operating performance.

We believe Adjusted EBITDA and Adjusted Net Income are useful to investors because these performance measures are used by our management and the Company’s Board of Directors for measuring and reporting the Company’s financial performance and as a measurement in incentive compensation for management. These measures exclude the impact of certain items which we believe have less bearing on our core operating performance because they are items that are not needed or available to the Company’s managers in the daily activities of their businesses. We believe that the core operations of our business are those which can be affected by our management in a particular period through their resource allocation decisions that affect the underlying performance of our operations conducted during that period. We also believe that decisions utilizing Adjusted EBITDA and Adjusted Net Income allow for a more meaningful comparison of operating fundamentals between companies within our markets by eliminating the impact of capital structure and taxation differences between the companies.

To determine Adjusted EBITDA, we adjust Net Income for the following items: non-cash depreciation and amortization, interest expense, income taxes and other items as described below. Stock-based compensation expense and sponsor expense reimbursement is excluded from both Adjusted Net Income and Adjusted EBITDA because it is an expense, which cannot be impacted by our business managers. Stock-based compensation expense also reflects a cost which may obscure trends in our underlying vehicle businesses for a given period, due to the timing and nature of the equity awards. We also adjust for exceptional items, which are determined to be those that in management’s judgment are not indicative of our ongoing operating performance and need to be disclosed by virtue of their size, nature or incidence, and include non-cash items and items settled in cash. In determining whether an event or transaction is exceptional, management considers quantitative as well as qualitative factors such as the frequency or predictability of occurrence.

Adjusted EBITDA and Adjusted Net Income have limitations as analytical tools. These are not presentations made in accordance with GAAP, are not measures of financial condition and should not be considered as an alternative to net income or net loss for the period determined in accordance with GAAP. The most directly comparable GAAP measure to Adjusted EBITDA and Adjusted Net Income is Net Income for the relevant period. Adjusted EBITDA and Adjusted Net Income are not necessarily comparable to similarly titled measures used by other companies. As a result, you should not consider this performance measure in isolation from, or as a substitute analysis for, our results of operations as determined in accordance with GAAP. Moreover, such measures do not reflect:

•

our cash expenditures, or future requirements for capital expenditures or contractual commitments;

•

changes in, or cash requirements for, our working capital needs;

•

the cash requirements necessary to service interest or principal payments on our debt;

•

the cash requirements to pay our taxes.

The following table reconciles Net (Loss) Income to Adjusted EBITDA for the periods presented:

	Three Months Ended July 31,					Nine Months Ended July 31,
($ in millions)	2020			2019		2020			2019
Net (loss) income	$	(3.6	)	$	5.6	$	(20.3	)	$	(3.3	)
Depreciation and amortization		9.2			10.9		30.9			34.8
Interest expense, net		5.7			8.4		20.3			24.2
(Benefit) provision for income taxes		(0.5	)		1.9		(13.2	)		—
EBITDA		10.8			26.8		17.7			55.7
Transaction expenses(a)		0.6			0.5		2.6			0.7
Sponsor expense reimbursement(b)		0.1			—		0.2			0.6
Restructuring costs(c)		2.5			1.3		6.0			4.2
Restructuring related costs(d)		0.7			—		3.9			—
Stock-based compensation expense(e)		1.8			2.5		7.2			7.3
Legal matters(f)		0.1			0.8		1.6			5.3
Loss on sale of business(g)		0.5			—		9.3			—
Gain on acquisition of business(h)		—			—		(11.9	)		—
Impairment charges(i)		3.7			—		3.7			2.8
Losses (earnings) attributable to assets held for sale(j)		0.6			1.0		(0.8	)		3.3
Deferred purchase price payment(k)		—			0.6		0.1			2.8
Adjusted EBITDA	$	21.4		$	33.5	$	39.6		$	82.7

The following table reconciles Net (Loss) Income to Adjusted Net Income (Loss) for the periods presented:

	Three Months Ended July 31,						Nine Months Ended July 31,
($ in millions)	2020			2019			2020			2019
Net (loss) income	$	(3.6	)	$	5.6		$	(20.3	)	$	(3.3	)
Amortization of intangible assets		3.0			4.1			10.4			13.3
Transaction expenses(a)		0.6			0.5			2.6			0.7
Sponsor expense reimbursement(b)		0.1			—			0.2			0.6
Restructuring costs(c)		2.5			1.3			6.0			4.2
Restructuring related costs(d)		0.7			—			3.9			—
Stock-based compensation expense(e)		1.8			2.5			7.2			7.3
Legal matters(f)		0.1			0.8			1.6			5.3
Loss on sale of business(g)		0.5			—			9.3			—
Gain on acquisition of business(h)		—			—			(11.9	)		—
Impairment charges(i)		3.7			—			3.7			2.8
Losses (earnings) attributable to assets held for sale(j)		0.6			1.0			(0.8	)		3.3
Deferred purchase price payment(k)		—			0.6			0.1			2.8
Impact of tax rate change(l)		—			—			(3.5	)		—
Income tax effect of adjustments(m)		(3.7	)		(2.8	)		(11.0	)		(10.4	)
Adjusted Net Income (Loss)	$	6.3		$	13.6		$	(2.5	)	$	26.6

(a)	Reflects costs incurred in connection with business acquisitions and capital market transactions. These expenses consist primarily of legal, accounting and due diligence expenses.

(b)	Reflects the reimbursement of expenses to the Company’s primary equity holder.

(c)	Restructuring expenses in the current fiscal year consisted of personnel costs, including severance, vacation and other employee benefit payments associated with headcount reductions in Corporate and the Fire division and lease termination costs related to the closure of a Spartan ER facility.

Restructuring expenses in the prior year period consisted of personnel costs, including severance, vacation and other employee benefit payments as well as facility closure and lease termination costs.

(d)	Reflects costs that are directly attributable to restructuring activities, including leadership changes, but do not meet the definition of restructuring under ASC 420.

(e)	Reflects expenses associated with the vesting of equity awards and award modifications.

(f)

Reflects legal fees and costs incurred to litigate and settle legal claims against us which are outside the normal course of business. Costs include payments: (i) to settle certain claims arising from a putative class action in the state of California, (ii) for fees and costs to litigate and settle non-ordinary course product, intellectual property and employment disputes and (iii) for fees and costs to litigate the putative securities class actions and derivative action pending against us and certain of our directors and officers.

(g)	Reflects losses related to the sale of our shuttle bus businesses, which was completed on May 8, 2020. Refer to Note 8, Divestiture Activities, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

(h)	Reflects gain on acquisition of Spartan ER, which was completed on February 1, 2020. Refer to Note 4, Acquisition, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

(i)	In connection with the anticipated liquidation of all rental vehicles, the Company recorded a $3.7 million impairment charge during the three months ended July 31, 2020. This impairment charge represents the difference between the carrying value of the assets and expected sale proceeds.

Impairment charge in the prior year period reflects additional non-cash impairment charges related to the sale of the assets of Revability. Refer to Note 8, Divestiture Activities, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

(j)	Adjusted EBITDA attributable to businesses that are or were classified as held for sale, which represents shuttle bus businesses and REV Coach during fiscal year 2020 and Revability during fiscal year 2019.

(k)	Reflects the expense associated with the deferred purchase price payments to sellers of Lance. The Company paid $5.0 million during the first quarter of 2019 and $5.0 million during the second quarter of fiscal year 2020 to fully settle the deferred liability.

(l)	Reflects the impact of net operating loss carrybacks as a result of the CARES Act. Refer to Note 13, Income Taxes, of the Notes to Condensed Unaudited Consolidated Financial Statements for further details.

(m)	Income tax effect of adjustments using a 26.5% effective income tax rate for the three and nine months ended July 31, 2020 and July 31, 2019, except for certain transaction expenses, impact of tax rate change and losses attributable to assets held for sale.

Off-Balance Sheet Arrangements

We have not created, and are not party to, any special-purpose or off-balance sheet entities for the purpose of raising capital, incurring debt or operating our business. We do not have any off-balance sheet arrangements or relationships with entities that are not consolidated into or disclosed in our consolidated financial statements that have, or are reasonably likely to have, a material current or future effect on our financial condition, revenues, expenses, results of operations, liquidity, capital expenditures and capital resources. In addition, we do not engage in trading activities involving non-exchange traded contracts.

Critical Accounting Policies and Estimates

The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates, assumptions and judgments that affect amounts reported in the consolidated financial statements and accompanying notes. The Company's disclosures of critical accounting policies are reported in its 2019 Annual Report on Form 10-K for the fiscal year ended October 31, 2019. In the first quarter of fiscal year 2020, the Company adopted ASU 2016-02 relating to leases, as discussed in Note 1 and Note 3 of the Notes to Condensed Unaudited Consolidated Financial Statements.

Recent Accounting Pronouncements

See Note 1 of the Notes to Condensed Unaudited Consolidated Financial Statements for a discussion of the impact on our financial statements of new accounting standards.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes in our exposure to interest rate risk, foreign exchange risk and commodity price risk from the information provided in the Company’s Annual Report on Form 10-K filed on December 18, 2019.

Item 4. Controls and Procedures.

The Company maintains “disclosure controls and procedures”, as such term is defined under Exchange Act Rule 13a-15(e), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. In designing and evaluating the disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. The Company has carried out an evaluation, as of the end of the period covered by this report, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of July 31, 2020.

During the quarter ended July 31, 2020, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

For a description of our legal proceedings, see Note 14, Commitments and Contingencies, of the Notes to Condensed Unaudited Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q.

Item 1A. Risk Factors

Our business faces many risks and uncertainties that we cannot control. In addition to the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the risks set forth below and in “Item 1A. Risk Factors,” in our 2019 Annual Report on Form 10-K for the fiscal year ended October 31, 2019 and in our Quarterly Report on Form 10-Q for the quarterly period ended April 30, 2020, together with the other information contained in our other filings with the SEC, in connection with evaluating the Company and our business. Such risks may be amplified by the COVID-19 pandemic and its potential impact on our business and the global economy. Other risks that we do not presently know about or that we presently believe are not material could also adversely affect us.

The COVID-19 pandemic has impacted, and could in the future materially and adversely affect, our business.

The novel strain of the coronavirus identified in China in late 2019 (COVID-19) and now affecting the global community has impacted and is expected to continue to impact our operations, and the full nature and extent of the impact is highly uncertain and may be beyond our control. Among other things, uncertainties relating to COVID-19 include the duration of the outbreak, the severity of the virus and the actions, or perception of actions, that may be taken to contain or treat its impact, by governments and others, including declarations of states of emergency, business closures, manufacturing restrictions and a prolonged period of travel, commercial and/or other similar restrictions and limitations.

Furthermore, as a result of COVID-19 and the measures implemented that are designed to contain its spread, our customers have been and could continue to be negatively impacted, resulting in a disruption in demand which could negatively impact our sales and have a material adverse effect on our business, results of operations and financial condition. Similarly, as a result of COVID-19 and measures implemented that are designed to contain its spread, our suppliers may not have the materials, capacity, or capability to enable the manufacture of our products according to our schedule and specifications. For example, in early 2020, we experienced delays in the supply of certain components for our vehicles. Because of impacts to suppliers’ operations, we may need to seek

alternate suppliers, which may be more expensive, may not be available or may result in delays in shipments to us and subsequently to our customers, each of which would affect our results of operations.

The COVID-19 pandemic has also disrupted our internal operations, including by heightening the risk that a significant portion of our workforce will suffer illness or otherwise not be permitted or be unable to work and exposing us to cyber and other risks associated with a large number of our employees working remotely. Beginning the week of March 23, 2020, we suspended normal production activities within the Recreation segment at all four of our RV production facilities in Indiana and California and furloughed most salaried employees within the Recreation segment. While operations at these facilities generally restarted in May 2020, we cannot predict whether our facilities will experience additional disruptions or more significant or frequent disruptions in the future.

In addition, the COVID-19 pandemic has led to disruption and volatility in the global capital markets, which could impact our capital resources and liquidity in the future. To improve our liquidity position, we obtained financial covenant relief under an amendment to our Term Loan Agreement on April 29, 2020. However, there can be no assurances that we will be able to obtain further amendments that we may require to our ABL Facility or Term Loan Agreement, or that we will be able to obtain any financing required to support our liquidity position on commercially reasonable terms or at all.

Further, if our operations, employees, suppliers or customers are adversely impacted by COVID-19, including individual infections leading to injury or death, or the inability for us to meet our contractual obligations, then we may be exposed to reputational, competitive, operational, financial and business harm as well as litigation and regulatory action. The costs and operational consequences of responding to the above items could be significant and could adversely impact our results.

The impact of the COVID-19 pandemic continues to evolve and its duration and ultimate disruption to our customers and to our supply chain, and related financial impact to us, cannot be estimated at this time. Should such disruption continue for an extended period of time, the impact could have a more severe adverse effect on our business, results of operations and financial condition. Additionally, weaker economic conditions generally could result in impairment in value of our tangible or intangible assets, or our ability to raise additional capital, if needed.

On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”). The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. Although we continue to examine the impacts the CARES Act may have on our business, results of operations, financial condition and liquidity, and our financial statements include the benefits we have been able to assess at this time, future benefits rely to some extent on future performance of the company, and it is currently unclear how we will fully benefit from the CARES Act.

Item 6. Exhibits.

Exhibit Number		Description

10.1*		Change in Control Severance Agreement Form.
31.1*		Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted in iXBRL and contained within Exhibit 101)

*	Filed herewith.

SIGNATURES

Pursuant to the requirements 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.

	REV GROUP, INC.

Date: September 9, 2020	By:	/s/ Rodney N. Rushing
		Rodney N. Rushing
		Chief Executive Officer

Date: September 9, 2020	By:	/s/ Mark A. Skonieczny
		Mark A. Skonieczny
		Chief Financial Officer

revg-ex101_79.htm

EXHIBIT 10.1

REV GROUP, INC.

CHANGE IN CONTROL SEVERANCE AGREEMENT

THIS AGREEMENT, made and entered into as of the [ ] day of [ ], [ ], by and between REV GROUP, INC., a Delaware corporation (“Company”), and [ ] (“Executive”).

WITNESSETH:

WHEREAS, the Executive is employed by the Company as a key executive officer, and the Executive’s services in such capacities are critical to the continued successful conduct of the business of the Company;

WHEREAS, the Company recognizes that circumstances in which a change in control of the Company occurs, through acquisition or otherwise, are highly disruptive and will cause uncertainty about the Executive’s future employment with the Company without regard to the Executive’s competence or past contributions and that such uncertainty may materially adversely affect the Company;

WHEREAS, the Company and the Executive are desirous that any proposal for a change in control or acquisition of the Company will be considered by the Executive objectively, with reference only to the best interests of the Company and its stockholders and without undue regard for the Executive’s personal interests; and

WHEREAS, the Executive will be in a better position to consider the Company’s and its stockholders’ best interests if the Executive is afforded reasonable security, in the form of severance as provided in this Agreement, against altered conditions of employment which could result from any such change in control or acquisition.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements hereinafter set forth, the parties hereto mutually covenant and agree as follows:

1.Definitions.

(a)Accounting Firm. For purposes of this Agreement “Accounting Firm” shall mean a nationally recognized certified public accounting firm or other professional organization that is a certified public accounting firm recognized as an expert in determinations and calculations for purposes of Section 280G of the Code that is selected by the Company prior to a Change of Control for purposes of making the applicable determinations hereunder and is reasonably acceptable to the Executive, which firm shall not, without the Executive’s consent, be

a firm serving as accountant or auditor for the individual, entity or group effecting the Change of Control.

(b)Act. For purposes of this Agreement, the term “Act” means the Securities Exchange Act of 1934, as amended.

(c)Affiliate and Associate. For purposes of this Agreement, the terms “Affiliate” and “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations of the Act.

(d)Beneficial Owner. For purposes of this Agreement, a Person shall be deemed to be the “Beneficial Owner” of any securities:

(i)which such Person or any of such Person’s Affiliates or Associates has the right to acquire (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding, or upon the exercise of conversion rights, exchange rights, rights, warrants or options, or otherwise; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially own, securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase;

(ii)which such Person or any of such Person’s Affiliates or Associates, directly or indirectly, has the right to vote or dispose of or has “beneficial ownership” of (as determined pursuant to Rule 13d‑3 of the General Rules and Regulations under the Act), including pursuant to any agreement, arrangement or understanding; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially own, any security under this subparagraph (ii) as a result of an agreement, arrangement or understanding to vote such security if the agreement, arrangement or understanding: (A) arises solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations under the Act and (B) is not also then reportable on a Schedule 13D under the Act (or any comparable or successor report); or

(iii)which are beneficially owned, directly or indirectly, by any other Person with which such Person or any of such Person’s Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except pursuant to a revocable proxy as described in Subsection 1(d)(ii) above) or disposing of any voting securities of the Company.

(e)Cause. “Cause” for termination by the Company of the Executive’s employment after a Change in Control of the Company (or prior to a Change in Control of the Company pursuant to Section 2) shall, for purposes of this Agreement, be limited to any of the following: (i) the engaging by the Executive in intentional conduct not taken in good faith which has caused demonstrable and serious financial injury to the Company; (ii) conviction of a felony (as evidenced by binding and final judgment, order or decree of a court of competent jurisdiction, in effect after exhaustion or lapse of all rights of appeal) which substantially impairs the

Executive’s ability to perform his duties or responsibilities; and (iii) continuing willful and unreasonable refusal by the Executive to perform the Executive’s duties or responsibilities (unless significantly changed without the Executive’s consent).

(f)Change in Control of the Company. For purposes of this Agreement, a “Change in Control of the Company” shall be deemed to have occurred if:

i.any Person (other than the Company or any trustee or other fiduciary holding securities under an employee benefit plan of the Company) is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing one-half (50%) or more of the combined voting power of the Company’s then outstanding voting securities;

ii.the following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who, as of the date of this Agreement, constitute the Board of Directors of the Company and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board of Directors of the Company or nomination for election by the Company’s stockholders was approved or recommended by a vote of a majority of the directors then still in office who either were directors as of the date of this Agreement or whose appointment, election or nomination for election was previously so approved or recommended;

iii.there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than a merger or consolidation immediately following which the individuals who comprise the Board of Directors of the Company immediately prior thereto constitute at least a majority of the Board of Directors of the Company, the entity surviving such merger or consolidation or, if the Company or the entity surviving such merger is then a subsidiary, the ultimate parent thereof; or

iv.there is a complete liquidation of the Company or there is sale or disposition by the Company of all or substantially all of the Company’s assets (or any transaction having a similar effect), other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, immediately following which the individuals who comprise the Board of Directors of the Company immediately prior thereto constitute at least a majority of the board of directors of the entity to which such assets are sold or disposed of or, if such entity is a subsidiary, the ultimate parent thereof.

Notwithstanding the foregoing, a Change in Control of the Company shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the holders of the Stock immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions.

(g)Code. For purposes of this Agreement, the term “Code” means the Internal Revenue Code of 1986, including any amendments thereto or successor tax codes thereof.

(h)Covered Termination. For purposes of this Agreement, the term “Covered Termination” means any termination of the Executive’s employment where the Termination Date is any date on or after a Change in Control of the Company (except as provided in Section 2) and prior to the end of the Employment Period.

(i)Disability. For purposes of this Agreement, “Disability” shall mean the Executive’s inability to perform the essential functions of Executive’s job, with or without reasonable accommodation, for a period of one hundred and twenty (120) consecutive days, or one hundred and eighty (180) days in the aggregate during any three hundred sixty-five (365) day period.

(j)Employment Period. For purposes of this Agreement, the term “Employment Period” means the period commencing on the date of a Change in Control of the Company and ending at 11:59 p.m. Milwaukee time on the second anniversary of such date.

(k)Good Reason. For purposes of this Agreement, the Executive shall have a “Good Reason” for termination of employment after a Change in Control of the Company in the event of any of the following without Executive’s written consent:

i.A material reduction in Executive's base salary or annual cash incentive compensation opportunity;

ii.A material reduction in Executive’s authority, duties or responsibilities with the Company;

iii.Executive being required by the Company to be based at any office or location that is more than fifty (50) miles from the location where Executive was principally employed immediately preceding the Change in Control by the Company, which the Parties acknowledge would be a material relocation; and

iv.A material breach by the Company or its successor or assign, of this Agreement.

Notwithstanding the foregoing, in order for Executive to terminate for Good Reason, the Executive must give the Company a written notice of the Executive’s claim for Good Reason within 90 days of the initial existence of the condition(s) specified by Executive that constitute Good Reason and the Company shall have 30 days from the date of such notice in which to cure the condition giving rise to Good Reason, if curable. If, during such 30-day period, the Company cures the condition giving rise to Good Reason, Executive shall not have a “Good Reason” to terminate under this Agreement. If, during such 30-day period, the Company fails or refuses to cure the condition giving rise to Good Reason, the Executive shall have a “Good Reason” to terminate if he terminates his employment within 120 days of Executive’s original written notice of Good Reason.

(l)Net After-Tax Receipt. For purposes of this Agreement, the term “Net After-Tax Receipt” shall mean the present value (as determined in accordance with Section

280G(b)(2)(A)(ii) and Section 280G(d)(4) of the Code) of a Payment net of all taxes imposed on the Executive with respect thereto under Section 1 and Section 4999 of the Code and under applicable state and local laws, determined by applying the highest marginal rate under Section 1 of the Code and under state and local laws which applied to the Executive’s taxable income for the immediately preceding taxable year, or such other rate(s) as the Accounting Firm determines to be likely to apply to the Executive in the relevant tax year(s).

(m)Parachute Value. For purpose of this Agreement, the term “Parachute Value” of a Payment shall mean the present value as of the date of the Change of Control for purposes of Section 280G of the Code of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2) of the Code, as determined by the Accounting Firm for purposes of determining whether and to what extent the excise tax under Section 4999 of the Code will apply to such Payment.

(n)Payment. For purposes of this Agreement, “Payment” shall mean any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or payable pursuant to the Agreement or otherwise.

(o)Person. For purposes of this Agreement, the term “Person” shall mean any individual, firm, partnership, corporation or other entity, including any successor (by merger or otherwise) of such entity, or a group of any of the foregoing acting in concert.

(p)Safe Harbor Amount. For purposes of this Agreement, “Safe Harbor Amount” shall mean 2.99 times the Executive’s “base amount,” within the meaning of Section 280G(b)(3) of the Code.

(q)Stock. For purposes of this Agreement, the term “Stock” means shares of the common stock, par value $.001 per share, of the Company.

(r)Termination Date. For purposes of this Agreement, except as otherwise provided in Section 6 hereof, the term “Termination Date” means (i) if the Executive’s employment is terminated by the Executive’s death, then the date of death; (ii) if the Executive’s employment is terminated by reason of Disability pursuant to Section 7 hereof, then the date the Notice of Termination is given; (iii) if the Executive’s employment is terminated by the Executive voluntarily, then the date the Notice of Termination is given; and (iv) if the Executive’s employment is terminated by the Company (other than by reason of Disability pursuant to Section 7 hereof) or by the Executive for Good Reason, then the earlier of thirty (30) days after the Notice of Termination is given or one day prior to the end of the Employment Period. Notwithstanding the foregoing,

(A)If termination is by the Company for Cause pursuant to Section 1(e)(iii) of this Agreement and if the Executive has substantially cured the conduct constituting such Cause as described by the Company in its Notice of Termination within such thirty (30) day or shorter period, then the Executive’s employment hereunder shall continue as if the Company had not delivered its Notice of Termination and there shall be no Termination Date arising out of such Notice.

(B)If the termination is described in Section 2 hereof, then the Termination Date shall be the date of the Executive’s termination of employment from the Company.

2.Termination or Cancellation Prior to Change in Control. The Company shall retain the right to terminate the employment of the Executive at any time prior to a Change in Control of the Company, subject to the terms and conditions of any other then existing written employment arrangement or agreement between the Executive and the Company; provided, however, that if the Executive’s employment is terminated by the Company, other than by reason of (i) death, (ii) Disability in accordance with Section 7 hereof, or (iii) Cause, at any time after Board of Directors’ authorized negotiations are commenced between the Company and another Person which ultimately lead to a Change in Control of the Company, then the Executive shall be entitled to receive at the earlier to occur of the closing or the effective date of such Change in Control of the Company all Accrued Benefits (to the extent not theretofore paid) and a Termination Payment, including benefits under Section 5(b) hereof, as if such termination of employment was a Covered Termination under Section 5 hereof. Other than as set forth above or as provided in Section 11 hereof, in the event the Executive’s employment is terminated prior to a Change in Control of the Company, this Agreement shall be terminated and canceled and of no further force and effect and any and all rights and obligations of the parties hereunder shall cease.

3.Termination For Cause or Without Good Reason. If there is a Covered Termination for Cause or due to the Executive’s voluntarily terminating his employment other than for Good Reason (any such terminations to be subject to the procedures set forth in Section 8 hereof), then the Executive shall be entitled to receive only Accrued Benefits described in Section 5(a) hereof.

Termination Giving Rise to a Termination Payment.

(a) If there is a Covered Termination by the Executive for Good Reason, or by the Company other than by reason of (i) death, (ii) Disability pursuant to Section 7 hereof, or (iii) Cause, then the Executive shall be entitled to receive, and the Company shall pay, Accrued Benefits described in Section 5(a) hereof and, as severance pay, the Termination Payment, described in Section 5(b) hereof.

(b)If there is a Covered Termination and the Executive is entitled to Accrued Benefits and the Termination Payment, then the Executive shall be entitled to the following additional benefits:

(i)The Executive shall receive, at the expense of the Company, reasonable outplacement services on an individual basis provided by a nationally recognized executive placement firm selected by the Company and acceptable to Executive for up to one year following the date of the Covered Termination, up to a maximum expense of Thirty Thousand Dollars ($30,000.00).

(ii)Until the earlier of the eighteen month anniversary of the Termination Date or such time as the Executive has obtained new employment and is covered by benefits which in the aggregate are at least equal in value to the following benefits the Executive shall continue to be covered, at the expense of the Company, by the

same or equivalent life insurance, hospitalization, medical and dental coverage as was required hereunder with respect to the Executive immediately prior to the date the Notice of Termination is given. The continuation of hospitalization, medical and dental coverage hereunder shall count as COBRA continuation coverage; and

If an Executive is entitled to the benefits described in this Section 4(b)(ii) due to Executive’s termination of employment pursuant to Section 2 of this Agreement, then to the extent necessary to discharge the Company’s obligation to Executive under this Section 4(b)(ii) the Company shall either (1) reimburse the Executive for any COBRA premiums paid by Executive between the date of the Executive’s Termination Date and the date of the Change in Control of the Company (or such earlier date as the Executive would cease being eligible for the benefits as described herein), or (2) provide retroactive coverage effective as of the Executive’s Termination Date.

5.Payments Upon Termination.

(a)Accrued Benefits. For purposes of this Agreement, the Executive’s “Accrued Benefits” shall include the following amounts, payable as described herein: (i) all base salary for the time period ending with the Termination Date; (ii) reimbursement for any and all monies advanced in connection with the Executive’s employment for reasonable and necessary expenses incurred by the Executive on behalf of the Company for the time period ending with the Termination Date; (iii) any and all other cash earned though the Termination Date and deferred at the election of the Executive or pursuant to any deferred compensation plan then in effect; (iv) subject to any irrevocable deferral election then in effect, a lump sum payment of the bonus, incentive compensation and other compensation reportable on Form W‑2 otherwise payable to the Executive with respect to the year in which termination occurs under all bonus or incentive compensation plan or plans of the Company in which the Executive is a participant; and (v) all other payments and benefits to which the Executive may be entitled as compensatory fringe benefits or under the terms of any benefit plan of the Company. Payment of Accrued Benefits shall be made promptly in accordance with the Company’s prevailing practice with respect to Subsections (i) and (ii) (provided that reimbursements due under clause (ii) must be completed no later than the end of the second calendar year following the year in which the Termination Date occurs) or, with respect to Subsections (iii), (iv) and (v), pursuant to the terms of the benefit plan or practice establishing such benefits.

(b)Termination Payment. The Termination Payment shall be an amount equal to [ ]¹ times the sum of (i) the Executive’s base salary in effect as of the Termination, or if higher, the Executive’s base salary that was in effect immediately prior to the Change in Control of the Company, plus (ii) the greater of (x) the Executive’s target annual cash incentive for the Company’s fiscal year that includes the Termination Date or (y) the Executive’s target annual cash incentive for the fiscal year during which the Change in Control of the Company occurred. The Termination Payment shall be contingent on the Executive executing a general release of claims in substantially the same form as the Release and Waiver included as Exhibit

¹	“Three” for the Chief Executive Officer. “Two” for other executive officers.

A to this Agreement and the expiration of the revocation period applicable thereto, which execution must occur on or following the Termination Date but no later than forty-five (45)

days following the Termination Date, or earlier if provided in the Release and Waiver. Except as otherwise provided herein, the Termination Payment shall be paid to the Executive in a cash lump sum as soon as practical following the Executive’s execution of, and expiration of the revocation period provided for in the Release and Waiver, but in no event later than sixty (60) business days after the Termination Date. The Executive shall not be required to mitigate the amount of the Termination Payment by securing other employment or otherwise, nor will such Termination Payment be reduced by reason of the Executive securing other employment or for any other reason. For the avoidance of doubt, if the Executive is entitled to the Termination Payment under this Agreement, the Termination Payment shall be in lieu of any payments under any other severance policy or practice of the Company or its successor.

(c)Certain Reductions in Payments.

(i)Notwithstanding anything in this to the contrary, if the Accounting Firm shall determine that receipt of all Payments would subject the Executive to the excise tax under Section 4999 of the Code, the Accounting Firm shall determine whether to reduce any of the Payments paid or payable pursuant to the Agreement (the “Agreement Payments”) so that the Parachute Value (as defined below) of all Payments, in the aggregate, equals the Safe Harbor Amount (as defined below). The Agreement Payments shall be so reduced only if the Accounting Firm determines that the Executive would have a greater Net After-Tax Receipt of aggregate Payments if the Agreement Payments were so reduced. If the Accounting Firm determines that the Executive would not have a greater Net After-Tax Receipt of aggregate Payments if the Agreement Payments were so reduced, the Executive shall receive all Agreement Payments to which the Executive is entitled hereunder.

(ii)If the Accounting Firm determines that aggregate Agreement Payments should be reduced so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount, the Company shall promptly give the Executive notice to that effect and a copy of the detailed calculation thereof. All determinations made by the Accounting Firm under this Section 5(c) shall be binding upon the Company, the Affiliated Entities and the Executive and shall be made as soon as reasonably practicable and in no event later than 15 days following the Termination Date. For purposes of reducing the Agreement Payments so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount, only amounts payable under the Agreement (and no other Payments) shall be reduced. The reduction of the amounts payable hereunder, if applicable, shall be made by reducing the Agreement Payments that are parachute payments in the following order: (1) outplacement benefits under Section 4(b)(i), (2) the cash Termination Payment described under Section 5(b), and (3) subsidized COBRA continuation coverage as provided under Section 4(b)(ii). All reasonable fees and expenses of the Accounting Firm shall be borne solely by the Company.

(iii)As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is

possible that amounts will have been paid or distributed by the Company to or for the benefit of the Executive pursuant to this Agreement that should not have been so paid or distributed (each, an “Overpayment”) or that additional amounts that will have not been paid or distributed by the Company to or for the benefit of the Executive pursuant to this Agreement could have been so paid or distributed (each, an “Underpayment”). In the event that the Accounting Firm, based upon the assertion of a deficiency by the Internal Revenue Service against the Company or the Executive that the Accounting Firm believes has a high probability of success determines that an Overpayment has been made, any such Overpayment paid or distributed by the Company to or for the benefit of the Executive shall be repaid by the Executive to the Company (as applicable) together with Interest; provided, however, that no such repayment shall be required if and to the extent such deemed repayment would not either reduce the amount on which the Executive is subject to tax under Section 1 and Section 4999 of the Code or generate a refund of such taxes. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an Underpayment has occurred, any such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive together with Interest.

(iv)To the extent requested by the Executive, the Company and the Affiliated Entities shall cooperate with the Executive in good faith in valuing, and the Accounting Firm shall take into account the value of, services provided or to be provided by the Executive (including, without limitation, the Executive’s agreeing to refrain from performing services pursuant to a covenant not to compete or similar covenant, before, on or after the date of a change in ownership or control of the Company (within the meaning of Q&A-2(b) of the final regulations under Section 280G of the Code)), such that payments in respect of such services may be considered reasonable compensation within the meaning of Q&A-9 and Q&A-40 to Q&A-44 of the final regulations under Section 280G of the Code and/or exempt from the definition of the term “parachute payment” within the meaning of Q&A-2(a) of the final regulations under Section 280G of the Code in accordance with Q&A-5(a) of the final regulations under Section 280G of the Code.

Death.

(a) Except as provided in Section 6(b) hereof, in the event of a Covered Termination due to the Executive’s death, the Executive’s estate, heirs and/or beneficiaries (as determined by the Executive’s personal representative) shall receive all the Executive’s Accrued Benefits through the Termination Date.

(b)In the event the Executive dies after a Notice of Termination is given (i) by the Company, other than by reason of disability, or (ii) by the Executive for Good Reason, the Executive’s estate, heirs and beneficiaries shall be entitled to the benefits described in Section 6(a) hereof and, subject to the provisions of this Agreement, to such Termination Payment as the Executive would have been entitled to had the Executive lived. For purposes of this Section 6(b), the Termination Date shall be the earlier of thirty (30) days following the giving of the Notice of Termination or one day prior to the end of the Employment Period.

7.Termination for Disability. If there is a Covered Termination by the Company due to Executive’s Disability, then the Executive shall be entitled to receive only the Accrued Benefits described in h Section 5(a) hereof; provided, however, that Executive shall remain eligible for all

benefits provided by any long term disability programs of the Company in effect at the time of such termination. The Company may terminate Executive’s employment due to Disability hereunder only if (i) the Company provides at least thirty (30) day’s advance written notice to Executive that it intends to terminate Executive’s employment on account of Disability (which notice shall not constitute the Notice of Termination contemplated below); (ii) Executive shall have not returned to performing essential functions of Executive’s job, with or without accommodation, prior to the termination date specified in such notice; and (iii) the Company provides a Notice of Termination in accordance with Section 8 hereof. The Company may also terminate Executive’s employment due to Disability immediately upon the provision of a Notice of Termination if Executive has returned to work after receiving a notice of intent to terminate for Disability as provided in subsection (ii) above, and Executive is unable or unwilling to perform the essential functions of his/her job with or without accommodation for a period of ninety (90) consecutive days following Executive’s return to work.

8.Termination Notice and Procedure. Any Covered Termination by the Company or the Executive shall be communicated by written Notice of Termination to the Executive, if such Notice is given by the Company, and to the Company, if such Notice is given by the Executive, all in accordance with the following procedures and those set forth in Section 17 hereof:

(a)If such termination is for disability, Cause or Good Reason, the Notice of Termination shall indicate in reasonable detail the facts and circumstances alleged to provide a basis for such termination.

(b)Any Notice of Termination by the Company shall have been approved, prior to the giving thereof to the Executive, by a resolution duly adopted in good faith by a majority of the directors of the Company (or any successor entity) then in office.

(c)The Executive shall have thirty (30) days, or such longer period as the Company may determine to be appropriate, to substantially cure any conduct or act, if curable, alleged to provide grounds for termination of the Executive’s employment for Cause under this Agreement.

(d)Except as otherwise provided in Section 1(k) hereof, the recipient of the Notice of Termination shall personally deliver or mail in accordance with Section 17 hereof written notice of any dispute relating to such Notice of Termination to the party giving such Notice within fifteen (15) days after receipt thereof. After the expiration of such fifteen (15) days, the contents of the Notice of Termination shall become final and not subject to dispute.

9.Confidentiality Obligations of the Executive; Noncompetition; Nonsolicitation.

(a)Confidentiality and Nondisclosure Obligations.

(i)Executive acknowledges (1) Company’s business is both highly specialized and competitive, and (2) certain non-public documents and information regarding Company’s customers, clients, services, methods of operation, sales, and the specialized business needs of Company’s customers and clients, constitute highly Confidential Information (as defined herein) that is not generally known to, or readily ascertainable by, the public or Company’s competitors. Executive further acknowledges

that, during Executive’s employment, Executive will have access to Confidential Information and property, processes and/or systems belonging to Company and/or its clients/customers, agrees such information shall remain the exclusive property of Company and/or its clients/customers respectively, and understands the misappropriation or unauthorized use/disclosure of such information at any time is prohibited and will cause Company irreparable injury.

(ii)For purposes of this Agreement, the term “Trade Secrets” shall have that meaning set forth under applicable law. Likewise, the term “Confidential Information” means information, property, processes and/or systems (whether or not in writing) that is not generally known to the public, is related to Company’s business and is maintained as confidential. Confidential Information includes, without limitation, means (i) any information, including formulas, patterns, compilations, programs, devices, methods, techniques, or processes that Company considers confidential and is valuable and provides a competitive advantage because it is not generally known and not readily ascertainable by proper means); methods or policies; prices or price formulas; processes; procedures; information relating to customers, including customer lists, prospective partners, partners, and other entities; financial information; computer software (including design, programming techniques, flow charts, source code, object code, and related information and documentation); personnel information; and any and all other information of any kind or character relating to the development, improvement, manufacture, sale, or delivery of products or services by Company, whether or not reduced to writing, (ii) information that is marked or otherwise treated as confidential or proprietary by the Company; and (iii) information received by the Company from others which the Company is obligated to keep confidential. Confidential Information does not include information that (a) is or becomes generally available to the public other than by the fault of Executive, (b) becomes available to Executive on a non-confidential basis from a source other than Company, provided that the source is not prohibited from disclosing such information to Executive by any contractual or other obligation with Company or otherwise, or (c) information that can be demonstrated to have been known by Executive prior to Executive’s employment with the Company. Confidential Information also does not include the general nature of Company’s business or this Agreement or a summary of it.

(iii)Both during and after Executive’s employment with the Company, Executive shall not, except as required to fulfill Executive’s job duties for the Company, directly or indirectly use or disclose Trade Secrets.

(iv)During Executive’s employment with the Company and for a period of two (2) years’ thereafter, Executive shall not, except as required to fulfill Executive’s job duties for the Company, directly or indirectly use or disclose any Confidential Information.

(b)Non-Solicitation.

that, in his/her employment with Company, he/she will have access to such information/relationships and be responsible for developing and maintaining such information/relationships.

(ii)For purposes of this Agreement, the term “Restricted Client” means any individual or entity (i) for whom/which the Company sold or provided products or services and (ii) with whom/which Executive had contact on behalf of the Company, or about whom/which Executive acquired Confidential Information as a result of Executive’s employment by the Company, in the case of both (i) and (ii), above, during the twelve (12) month period immediately prior to the end of Executive’s employment with the Company. Likewise, the term “Prospective Client” means any individual or entity (i) for whom/which the Company has made a bid or proposal to provide goods or services and (ii) with whom/which Executive had contact on behalf of the Company, or about whom/which Executive acquired non-public or proprietary information as a result of his/her employment with the Company, in the case of both (i) and (ii), above, during the twelve (12) month period immediately prior to the end of Executive’s employment with the Company.

(iii)Executive agrees that, during Executive’s employment with Company and for a period of [ ]² months thereafter, Executive will not directly or indirectly solicit, divert, or take away, or attempt to solicit, divert, or take away, the business or patronage of any Restricted Client.

(iv)Executive agrees that, during Executive’s employment with Company and for a period of [ ]² months thereafter, Executive will not directly or indirectly solicit, divert, or take away, or attempt to solicit, divert, or take away, the business or patronage of any Prospective Client.

(v)Executive agrees that, during Executive’s employment with Company and for a period of [ ]² months thereafter, Executive will not directly or indirectly, whether for Executive’s benefit or for the benefit of a third party, recruit, solicit, or induce, or attempt to recruit, solicit, or induce: (1) anyone employed by Company to terminate employment with, or otherwise cease a relationship with, Company; or (2) anyone employed by Company at any time during the immediately preceding twelve (12) months to provide services of any kind to a competitor of Company.

(c)Non-Competition.

(i)Executive acknowledges Company’s confidential/trade secret information and relationships with its customers, clients, employees, and other business associations are among Company’s most important assets. Executive further acknowledges that, in his/her employment with Company, he/she will have access to such information/relationships and be responsible for developing and maintaining such information/relationships.

²	“twenty-four” for chief executive officer. “eighteen” for other executive officers.

For purposes of this Agreement, the term “Restricted Services” means employment duties and functions of the type provided by Executive to the Company during the twelve (12) month period immediately preceding the end of Executive’s employment with the Company. Likewise, the term “Competitor” means any individual or entity that sells goods or services competitive with those sold by the Company, and the term “Territory” shall mean the United States of America.

(ii)For a period of [ ]² months immediately following the end, for whatever reason, of Executive’s employment with the Company, Executive agrees not to directly or indirectly provide Restricted Services to any Competitor, anywhere in Restricted Territory

(d)Enforcement.

(i)Executive agrees, during the term of any restriction contained in this Agreement, to disclose the terms of this Section 9 to any person or entity that offers employment to Executive. Executive further agrees that the Company may send a copy of this Agreement to, or otherwise make the provisions hereof known to, any of Executive’s potential or future employers.

(ii)The parties agree that damages will be an inadequate remedy for breaches of this Section 9 and, in addition to damages and any other available relief, a court shall be empowered to grant injunctive relief (without the necessity of posting bond or other security).

(iii)Notwithstanding anything in this Agreement to the contrary, the activity restrictions contained in this Section 9 are intended to run alongside, and neither supersede, be subservient to, nor replace any similar restrictions imposed by other agreements that may exist between Executive and the Company. If any provision of this Section 9 is deemed by a court of competent jurisdiction to be in irresolvable conflict with any other activity restriction that may be in place between Executive and the Company, and each restriction in question is deemed by such court to be fully enforceable on its terms, the provision which is determined by the Company to be more protective of its business interests shall control.

10.Payment Obligations and Expenses in the Event of a Dispute

(a)Payment Obligations Absolute. The Company’s obligations during and after the Employment Period to pay the Executive the amounts and to make the benefit and other arrangements provided herein shall be absolute and unconditional and shall not be affected by any circumstances, including, without limitation, any set off, counterclaim, recoupment, defense or other right which the Company may have against him or anyone else. Except as provided in Section 5(c) and Section 10(b) of this Agreement, all amounts payable by the Company hereunder shall be paid without notice or demand. Each and every payment made hereunder by the Company shall be final, and the Company will not seek to recover all or any part of such payment from the Executive, or from whomsoever may be entitled thereto, for any reason whatsoever. In no event shall the Executive be obligated to seek other employment or take any other action by

way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Executive obtains other employment.

(b)Expenses and Interest. If, after a Change in Control of the Company, a good faith dispute arises with respect to the enforcement of the Executive’s rights under this Agreement or if any legal or arbitration proceeding shall be brought in good faith to enforce or interpret any provision contained herein, or to recover damages for breach hereof, the Executive shall recover from the Company any reasonable attorneys’ fees and necessary costs and disbursements incurred by the Executive as a result of such dispute, legal or arbitration proceeding (“Expenses”), and prejudgment interest on any money judgment or arbitration award obtained by the Executive calculated at the rate of interest announced by US Bank, N.A. from time to time as its prime or base lending rate from the date that payments to him should have been made under this Agreement. Within ten (10) days after the Executive’s written request therefor, but no later than the end of the calendar year following the year in which the Executive incurred the Expense, the Company shall reimburse the Executive, or such other person or entity as the Executive may designate in writing to the Company, the Executive’s Expenses.

Assignment: Successors.

(a) If the Company proposes to engage in a potential Change in Control of the Company, then, at least ten (10) days in advance of the closing of such event, the Company shall, subject only to consummation of such Change in Control of the Company, assign all of its right, title and interest in this Agreement effective as of the closing date of such event to such Person, and the Company shall cause such Person, at least ten (10) days in advance of the closing of such event, by written agreement in form and substance reasonably satisfactory to the Executive and with written notice thereof to Executive, to expressly assume and agree to perform, subject only to consummation of such Change in Control of the Company, from and after the effective date of such event all of the terms, conditions and provisions imposed by this Agreement upon the Company. If such Change in Control of the Company is consummated, failure of the Company to obtain such an assumption agreement at least ten (10) days in advance of the closing of such event shall be a breach of this Agreement constituting “Good Reason” hereunder. In case of an effective assignment by the Company and of assumption and agreement by such Person, “Company” shall thereafter mean such Person which executes and delivers the agreement provided for in this Section 11 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law, and this Agreement shall inure to the benefit of and be enforceable by such Person. The Executive shall, in his discretion, be entitled to proceed against any or all of such Persons, any Person which theretofore was such a successor to the Company (as defined in the first paragraph of this Agreement) and the Company (as so defined) in any action to enforce any rights of the Executive hereunder. Except as provided in this Subsection, this Agreement shall not be assignable by the Company. This Agreement shall not be terminated by the voluntary or involuntary dissolution of the Company.

(b)This Agreement and all rights of the Executive shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, heirs and beneficiaries. All amounts payable to the Executive under Sections 3,

4, 5, 6 and 7 hereof if the Executive had lived shall be paid, in the event of the Executive’s death, to the Executive’s estate, heirs and representatives.

12.Severability. The provisions of this Agreement shall be regarded as divisible, and if any of said provisions or any part hereof are declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remainder of such provisions or parts hereof and the applicability thereof shall not be affected thereby.

13.Amendment. This Agreement may not be amended or modified at any time except by written instrument executed by the Company and the Executive.

14.Withholding. The Company shall be entitled to withhold from amounts to be paid to the Executive hereunder any federal, state or local withholding or other taxes or charges which it is from time to time required to withhold; provided, that, the amount so withheld shall not exceed the minimum amount required to be withheld by law. The Company shall be entitled to rely on an opinion of nationally recognized tax counsel if any question as to the amount or requirement of any such withholding shall arise.

15.Certain Rules of Construction. No party shall be considered as being responsible for the drafting of this Agreement for the purpose of applying any rule construing ambiguities against the drafter or otherwise. No draft of this Agreement shall be taken into account in construing this Agreement. Any provision of this Agreement which requires an agreement in writing shall be deemed to require that the writing in question be signed by the Executive and an authorized representative of the Company.

16.Governing Law: Resolution of Disputes. This Agreement and the rights and obligations hereunder shall be governed by and construed in accordance with the laws of the State of Wisconsin. Any dispute arising out of this Agreement shall, at the Executive’s election, be determined by arbitration under the rules of the American Arbitration Association then in effect or by litigation. Whether the dispute is to be settled by arbitration or litigation, the venue for the arbitration or litigation shall be Milwaukee, Wisconsin or, at the Executive’s election, in the judicial district encompassing the city in which the Executive resides. The parties consent to personal jurisdiction in each trial court in the selected venue having subject matter jurisdiction notwithstanding their residence or situs, and each party irrevocably consents to service of process in the manner provided hereunder for the giving of notices.

17.Notice. Notices given pursuant to this Agreement shall be in writing and shall be deemed given when actually received by the Executive or actually received by the Company’s General Counsel or any officer of the Company other than the Executive. If mailed, such notices shall be mailed by United States registered or certified mail, return receipt requested, addressee only, postage prepaid, if to the Company, to 111 East Kilbourn Ave., Suite 2600, ATTN: Chief Human Resources Officer, Milwaukee, WI 53202, or if to the Executive, at the address set forth below the Executive’s signature to this Agreement, or to such other address as the party to be notified shall have theretofore given to the other party in writing.

18.No Waiver. No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by the other

party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same time or any prior or subsequent time.

19.Headings. The headings herein contained are for reference only and shall not affect the meaning or interpretation of any provision of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.


EXECUTIVE		REV GROUP, INC.

		By:
		Name: Title:

EXHIBIT A

RELEASE AND WAIVER

This RELEASE AND WAIVER is made this ________ day of ________________, 20____,

by and between __________________and REV GROUP, INC.

IN CONSIDERATION FOR BENEFITS payable to me as contained in the REV Group, Inc. Change in Control Severance Agreement, I hereby agree as follows:

I, with the intention of binding myself, my heirs, executors, administrators and assigns, do hereby release, acquit and forever discharge REV Group, Inc. and its past and present subsidiaries and affiliates, and all of its past, present and future officers, directors, employees, shareholders, agents, partners, principals, members, representatives, insurers, reinsurers, estates, executors, administrators, heirs, successors, assigns and attorneys (hereinafter collectively the “Company"), of and from all manner of actions, causes of action, arbitrations, suits, debts, sums of money, accounts, reckonings, bonds, covenants, controversies, agreements, promises, damages, judgments, charges, claims and demands whatsoever that I now have or may have for actions, inactions or omissions of the Company on or prior to the date of execution of this Agreement, both known and unknown, fixed and contingent, including, but not limited to, any claims of employment discrimination under federal, state or local laws, claims under the Age Discrimination in Employment Act, claims under the Fair Employment Laws, any claimed violations of statute, any violations of public policy, any claims arising from my employment with the Company and/or my separation from employment, any claims growing out of any legal restriction on the Company’s right to terminate its employees, and any tort, contract, quasi-contract or other common law claims; provided, however, that the foregoing release shall not apply to: (i) any breach by the Company of this Agreement; (ii) my rights to any accrued benefits under any employee benefit plans; or (iii) any claims which may arise after the date this Agreement is signed.

I hereby expressly waive the benefits of any statute or rule of law which, if applied to this release, would otherwise exclude from its binding effect any claims not known by me to exist which arose prior to the signing of this Agreement.

Notwithstanding the foregoing, I understand that the scope of this release does not apply to claims under applicable workers’ compensation or unemployment insurance law, to any vested benefits I may be entitled, or to any other laws which, by their nature, cannot be legally released. I further understand and acknowledge that my acceptance of this release does not prevent, restrict or in any way limit my right to file a charge or complaint with a government agency or participate in an investigation or proceeding initiated or conducted by a government agency; provided, however, this release of claims does prevent me from making any personal recovery against the Company, including the recovery of money damages, as a result of filing a charge or complaint with a government agency against the Company.

The Company understands and agrees that the releases set forth herein do not in any way affect my rights to take whatever steps may be necessary to enforce the terms of this Agreement or to obtain relief in the event of the breach of the terms of this Agreement.

I understand that if I am 40 years of age or older, I am entitled to certain information as provided in the Older Workers Benefit Protection Act. If applicable, that information is attached and should remain attached to this RELEASE AND WAIVER. An additional copy has been provided and will be retained by

me. In addition, I understand that I have a period of at least 45 days to review this RELEASE AND WAIVER.

I understand that if I am under the age of 40, I have a period of at least 21 days to review this RELEASE AND WAIVER.

I expressly acknowledge that this RELEASE AND WAIVER is subject to an express agreement that all terms of the RELEASE AND WAIVER are confidential and shall not be disclosed to any person or entity except in response to a specific court order directing me to disclose such terms. If I obtain a prior promise of confidentiality for the benefit of the Company from my professional tax preparer, accountant, or attorney, and/or spouse, as applicable, I may disclose the terms of the RELEASE AND WAIVER to such a person who has agreed to keep the terms of this RELEASE AND WAIVER confidential.

I understand that all payments will cease, if there is any breach of this confidentiality provision.

I have carefully read and fully understand all the provisions of this RELEASE AND WAIVER which sets forth the entire RELEASE AND WAIVER between the Company and me. I have entered into this RELEASE AND WAIVER voluntarily and have not relied upon any representation or statement, written or oral, concerning the subject matter of this RELEASE AND WAIVER which is not set forth herein. I have also read and fully understand the severance letter previously provided to me. I understand that I am hereby advised to consult, and have had the opportunity to consult with, an attorney of my choosing.

I understand that this RELEASE AND WAIVER will be governed by the laws of the state in which I reside and of the United States and may be changed only by an amendment in writing signed by both the Company and me.

I understand that if I am 40 years of age or older, that I may revoke this RELEASE AND WAIVER at any time within a seven (7) day period immediately following the execution of this RELEASE AND WAIVER. This RELEASE AND WAIVER shall not become effective or enforceable until the eighth (8th) day following execution of this RELEASE AND WAIVER.

IN WITNESS WHEREOF, the parties have executed this RELEASE AND WAIVER on the date written above.

(EMPLOYEE):

REV Group, INC. (EMPLOYER):


			By:

Name:			Title:

Date:			Date:

CAUTION

THIS IS A RELEASE AND WAIVER. PLEASE READ BEFORE SIGNING.

YOU ARE HEREBY ADVISED TO SEEK THE ADVICE OF AN ATTORNEY BEFORE SIGNING.

revg-ex311_78.htm

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO EXCHANGE ACT RULES 13a-14 AND 15d-14, AS ADOPTED PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002

I, Rodney N. Rushing, certify that:

I have reviewed this Quarterly Report on Form 10-Q of REV Group, Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: September 9, 2020

By:

/s/ Rodney N. Rushing

Rodney N. Rushing

Chief Executive Officer

(Principal Executive Officer)

revg-ex312_77.htm

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO EXCHANGE ACT RULES 13a-14 AND 15d-14, AS ADOPTED PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002

I, Mark A. Skonieczny, certify that:

I have reviewed this Quarterly Report on Form 10-Q of REV Group, Inc.;

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: September 9, 2020

By:

/s/ Mark A. Skonieczny

Mark A. Skonieczny

Chief Financial Officer

(Principal Financial Officer)

revg-ex321_75.htm

EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of REV Group, Inc. (the “Company”) on Form 10-Q for the period ended July 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement has been provided to REV Group, Inc. and will be retained by REV Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.


Dated: September 9, 2020	By:	/s/ Rodney N. Rushing
		Rodney N. Rushing
		Chief Executive Officer (Principal Executive Officer)

revg-ex322_76.htm

EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated: September 9, 2020	By:	/s/ Mark A. Skonieczny
		Mark A. Skonieczny
		Chief Financial Officer (Principal Financial Officer)

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Jul. 31, 2020	Sep. 04, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 31, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--10-31
Entity File Number	001-37999
Trading Symbol	REVG
Title of 12(b) Security	Common Stock ($0.001 Par Value)
Security Exchange Name	NYSE
Entity Registrant Name	REV Group, Inc.
Entity Central Index Key	0001687221
Entity Incorporation, State or Country Name	DE
Entity Tax Identification Number	26-3013415
Entity Address, Address Line One	245 South Executive Drive
Entity Address, City or Town	Brookfield
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	53005
City Area Code	414
Local Phone Number	290-0190
Entity Interactive Data Current	Yes
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		63,476,203
Document Transition Report	false
Document Quarterly Report	true

Condensed Unaudited Consolidated Balance Sheets - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019
Current assets:
Cash and cash equivalents	$ 17.3	$ 3.3
Accounts receivable, net	239.3	253.5
Inventories, net	572.3	513.4
Other current assets	57.9	19.4
Assets held for sale		19.5
Total current assets	886.8	809.1
Property, plant and equipment, net	182.3	201.7
Goodwill	157.3	159.8
Intangible assets, net	142.3	159.9
Right of use assets	24.7
Other long-term assets	16.0	16.6
Total assets	1,409.4	1,347.1
Current liabilities:
Current portion of long-term debt	1.7	3.6
Accounts payable	175.8	200.8
Customer advances	185.9	129.9
Accrued warranty	23.7	16.1
Short-term lease obligations	9.3
Liabilities held for sale		15.4
Other current liabilities	72.4	70.2
Total current liabilities	468.8	436.0
Long-term debt, less current maturities	388.7	376.6
Deferred income taxes	27.6	15.4
Long-term lease obligations	16.8
Other long-term liabilities	25.4	13.9
Total liabilities	927.3	841.9
Commitments and contingencies
Shareholders' Equity:
Common stock ($.001 par value, 605,000,000 shares authorized; 63,476,203 and 62,217,486 shares issued and outstanding, respectively)	0.1	0.1
Additional paid-in capital	495.8	490.8
Retained (deficit) earnings	(11.2)	15.8
Accumulated other comprehensive loss	(2.6)	(1.7)
Total REV's shareholders' equity	482.1	505.0
Non-controlling interest		0.2
Total shareholders' equity	482.1	505.2
Total liabilities and shareholders' equity	$ 1,409.4	$ 1,347.1

Condensed Unaudited Consolidated Balance Sheets (Parenthetical) - $ / shares	Jul. 31, 2020	Oct. 31, 2019
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, authorized shares	605,000,000	605,000,000
Common stock, shares issued	63,476,203	62,217,486
Common stock, shares outstanding	63,476,203	62,217,486

Condensed Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Income Statement [Abstract]
Net sales	$ 582.2	$ 617.0	$ 1,661.3	$ 1,750.8
Cost of sales	515.7	545.7	1,495.0	1,560.7
Gross profit	66.5	71.3	166.3	190.1
Operating expenses:
Selling, general and administrative	53.5	48.9	157.6	145.3
Research and development costs	1.7	1.2	4.4	3.7
Amortization of intangible assets	3.0	4.0	10.4	13.2
Restructuring	2.5	1.3	6.0	4.2
Impairment charges	3.7		3.7	2.8
Total operating expenses	64.4	55.4	182.1	169.2
Operating income (loss)	2.1	15.9	(15.8)	20.9
Interest expense, net	5.7	8.4	20.3	24.2
Loss on sale of business	0.5		9.3
Gain on acquisition of business			(11.9)
(Loss) income before (benefit) provision for income taxes	(4.1)	7.5	(33.5)	(3.3)
(Benefit) provision for income taxes	(0.5)	1.9	(13.2)
Net (loss) income	(3.6)	5.6	(20.3)	(3.3)
Other comprehensive loss, net of tax	(0.8)		(0.9)	(0.2)
Comprehensive (loss) income	$ (4.4)	$ 5.6	$ (21.2)	$ (3.5)
Net (loss) income per common share:
Basic	$ (0.06)	$ 0.09	$ (0.32)	$ (0.05)
Diluted	$ (0.06)	0.09	(0.32)	(0.05)
Dividends declared per common share		$ 0.05	$ 0.10	$ 0.15

Condensed Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Cash flows from operating activities:
Net loss	$ (20.3)	$ (3.3)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	30.9	34.8
Amortization of debt issuance costs	1.8	1.5
Stock-based compensation expense	7.2	7.3
Deferred income taxes	8.3	3.5
Gain on sale of assets	(0.8)	(1.7)
Impairment charges	3.7	2.8
Loss on sale of business	9.3
Gain on acquisition of business	(11.9)
Changes in operating assets and liabilities, net	(3.2)	(22.9)
Net cash provided by operating activities	25.0	22.0
Cash flows from investing activities:
Purchase of property, plant and equipment	(9.7)	(14.1)
Purchase of rental and used vehicles	(3.3)	(3.0)
Proceeds from sale of assets	6.7	22.6
Proceeds from sale of businesses	50.9
Acquisition of business	(54.8)
Net cash (used in) provided by investing activities	(10.2)	5.5
Cash flows from financing activities:
Net proceeds (repayments) from borrowings under April 2017 ABL Facility	13.0	(52.0)
Net proceeds from borrowings of Term Loan		49.2
Repayment of long-term debt	(2.9)	(1.1)
Payment of dividends	(9.5)	(9.4)
Repurchase and retirement of common stock		(8.3)
Other financing activities	(1.4)	2.0
Net cash used in financing activities	(0.8)	(19.6)
Net increase in cash and cash equivalents	14.0	7.9
Cash and cash equivalents, beginning of period	3.3	11.9
Cash and cash equivalents, end of period	17.3	19.8
Cash paid (received) for:
Interest	20.9	22.6
Income taxes, net of refunds	$ 0.4	$ (9.0)

Condensed Unaudited Consolidated Statements of Shareholders' Equity - USD ($) $ in Millions	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings (Deficit) [Member]	Non-controlling Interest [Member]	Accumulated Other Comprehensive (Loss) [Member]
Balance at Oct. 31, 2018	$ 531.4	$ 0.1	$ 492.1	$ 40.6		$ (1.4)
Balance, shares at Oct. 31, 2018		62,683,808
Net (loss) income	(14.6)			(14.6)
Stock-based compensation expense	1.4		1.4
Exercise of common stock options	0.1		0.1
Exercise of common stock options, shares		20,000
Vesting of restricted and performance stock, net of employee tax withholdings, shares		94,237
Dividends declared on common stock	(3.2)			(3.2)
Balance at Jan. 31, 2019	515.1	$ 0.1	493.6	22.8		(1.4)
Balance, shares at Jan. 31, 2019		62,798,045
Balance at Oct. 31, 2018	531.4	$ 0.1	492.1	40.6		(1.4)
Balance, shares at Oct. 31, 2018		62,683,808
Net (loss) income	(3.3)
Other comprehensive income (loss), net of tax	(0.2)
Balance at Jul. 31, 2019	516.5	$ 0.1	490.4	27.6		(1.6)
Balance, shares at Jul. 31, 2019		62,207,841
Balance at Oct. 31, 2018	531.4	$ 0.1	492.1	40.6		(1.4)
Balance, shares at Oct. 31, 2018		62,683,808
Repurchase and retirement of common stock		$ (8.3)
Repurchase and retirement of common stock, Shares		(717,597)
Balance at Oct. 31, 2019	505.2	$ 0.1	490.8	15.8	$ 0.2	(1.7)
Balance, shares at Oct. 31, 2019		62,217,486
Balance at Jan. 31, 2019	515.1	$ 0.1	493.6	22.8		(1.4)
Balance, shares at Jan. 31, 2019		62,798,045
Net (loss) income	5.6			5.6
Other comprehensive income (loss), net of tax	(0.2)					(0.2)
Stock-based compensation expense	2.9		2.9
Exercise of common stock options	0.4		0.4
Exercise of common stock options, shares		54,000
Vesting of restricted and performance stock, net of employee tax withholdings, shares		40,828
Dividends declared on common stock	(3.2)			(3.2)
Repurchase and retirement of common stock	(5.3)		(5.3)
Repurchase and retirement of common stock, Shares		(495,475)
Balance at Apr. 30, 2019	515.3	$ 0.1	491.6	25.2		(1.6)
Balance, shares at Apr. 30, 2019		62,397,398
Net (loss) income	5.6			5.6
Stock-based compensation expense	1.7		1.7
Exercise of common stock options	0.1		0.1
Exercise of common stock options, shares		25,999
Vesting of restricted and performance stock, net of employee tax withholdings, shares		6,566
Dividends declared on common stock	(3.2)			(3.2)
Repurchase and retirement of common stock	(3.0)		(3.0)
Repurchase and retirement of common stock, Shares		(222,122)
Balance at Jul. 31, 2019	516.5	$ 0.1	490.4	27.6		(1.6)
Balance, shares at Jul. 31, 2019		62,207,841
Balance at Oct. 31, 2019	505.2	$ 0.1	490.8	15.8	0.2	(1.7)
Balance, shares at Oct. 31, 2019		62,217,486
Net (loss) income	(9.4)			(9.4)
Sale of business	(0.2)				(0.2)
Stock-based compensation expense	2.6		2.6
Exercise of common stock options	0.8		0.8
Exercise of common stock options, shares		102,000
Vesting of restricted and performance stock, net of employee tax withholdings, shares		360,986
Dividends declared on common stock	(3.1)			(3.1)
Balance at Jan. 31, 2020	495.9	$ 0.1	494.2	3.3		(1.7)
Balance, shares at Jan. 31, 2020		62,680,472
Balance at Oct. 31, 2019	505.2	$ 0.1	490.8	15.8	$ 0.2	(1.7)
Balance, shares at Oct. 31, 2019		62,217,486
Net (loss) income	(20.3)
Other comprehensive income (loss), net of tax	(0.9)
Repurchase and retirement of common stock, Shares		0
Balance at Jul. 31, 2020	482.1	$ 0.1	495.8	(11.2)		(2.6)
Balance, shares at Jul. 31, 2020		63,476,203
Balance at Jan. 31, 2020	495.9	$ 0.1	494.2	3.3		(1.7)
Balance, shares at Jan. 31, 2020		62,680,472
Net (loss) income	(7.6)			(7.6)
Other comprehensive income (loss), net of tax	(0.1)					(0.1)
Stock-based compensation expense	2.9		2.9
Vesting and issuance of restricted stock units and awards, net of forfeitures and employee tax withholdings	(1.2)		(1.2)
Vesting and issuance of restricted stock units and awards, net of forfeitures and employee tax withholdings, shares		717,054
Reclassification of liability awards	(1.7)		(1.7)
Dividends declared on common stock	(3.3)			(3.3)
Balance at Apr. 30, 2020	484.9	$ 0.1	494.2	(7.6)		(1.8)
Balance, shares at Apr. 30, 2020		63,397,526
Net (loss) income	(3.6)			(3.6)
Other comprehensive income (loss), net of tax	(0.8)					(0.8)
Stock-based compensation expense	1.6		1.6
Vesting and issuance of restricted stock units and awards, net of forfeitures and employee tax withholdings, shares		78,677
Repurchase and retirement of common stock, Shares		0
Balance at Jul. 31, 2020	$ 482.1	$ 0.1	$ 495.8	$ (11.2)		$ (2.6)
Balance, shares at Jul. 31, 2020		63,476,203

Basis of Presentation

9 Months Ended

Jul. 31, 2020

Accounting Policies [Abstract]

Basis of Presentation

Note 1. Basis of Presentation

Recent Accounting Pronouncements

Accounting Pronouncements Recently Adopted

The following accounting pronouncements did not have a material impact on the Company’s consolidated financial statements:

•

Revenue Recognition

9 Months Ended

Jul. 31, 2020

Revenue From Contract With Customer [Abstract]

Revenue Recognition

Note 2. Revenue Recognition

Contract Assets and Contract Liabilities

Leases

9 Months Ended

Jul. 31, 2020

Leases [Abstract]

Leases

Note 3. Leases

At July 31, 2020, future minimum operating lease payments due under ASC 842 are summarized by fiscal year in the table below:

Remaining three months of fiscal year 2020	$	2.3
2021		8.7
2022		6.9
2023		4.2
2024		2.4
Thereafter		3.9
Total undiscounted lease payments		28.4
Less: imputed interest		(2.4	)
Total lease liabilities	$	26.0

As of July 31, 2020, the weighted average remaining lease term and the weighted average discount rate for operating leases was 4.7 years and 5.0%, respectively.

As of October 31, 2019, future minimum operating lease payments (under ASC 840) summarized by fiscal year were as follows:

2020	$	8.5
2021		7.5
2022		5.8
2023		3.3
2024		1.5
Thereafter		0.1

Acquisition

9 Months Ended

Jul. 31, 2020

Business Combinations [Abstract]

Acquisition

Note 4. Acquisition

Spartan Emergency Response

The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed for Spartan ER:

Assets:
Accounts receivable, net	$	30.9
Inventories, net		77.7
Other current assets		2.4
Property, plant and equipment		15.2
Right of use assets		6.0
Total assets acquired		132.2
Liabilities:
Accounts payable		5.0
Customer advances		32.8
Accrued warranty		2.7
Other current liabilities		5.1
Short-term lease obligations		0.8
Deferred income taxes		3.9
Long-term lease obligations		5.4
Other long-term liabilities		9.8
Total liabilities assumed		65.5
Net assets acquired		66.7
Consideration paid		54.8
Gain on acquisition of business	$	(11.9	)

Inventories

9 Months Ended

Jul. 31, 2020

Inventory Disclosure [Abstract]

Inventories

Note 5. Inventories

Inventories, net of reserves, consisted of the following:

	July 31, 2020			October 31, 2019
Chassis	$	44.3		$	44.9
Raw materials		211.8			198.1
Work in process		256.6			200.8
Finished products		73.2			79.6
		585.9			523.4
Less: reserves		(13.6	)		(10.0	)
Total inventories, net	$	572.3		$	513.4

Property, Plant and Equipment

9 Months Ended

Jul. 31, 2020

Property Plant And Equipment [Abstract]

Property, Plant and Equipment

Note 6. Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	July 31, 2020			October 31, 2019
Land & land improvements	$	27.0		$	24.2
Buildings & improvements		104.5			107.6
Machinery & equipment		84.6			93.1
Rental & used vehicles		21.4			24.4
Computer hardware & software		55.6			58.1
Office furniture & fixtures		6.2			5.8
Construction in process		8.0			11.4
		307.3			324.6
Less: accumulated depreciation		(125.0	)		(122.9	)
Total property, plant and equipment, net	$	182.3		$	201.7

Goodwill and Intangible Assets

9 Months Ended

Jul. 31, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Note 7. Goodwill and Intangible Assets

The table below represents goodwill by segment:

	July 31, 2020		October 31, 2019
Fire & Emergency	$	88.6	$	88.6
Commercial		26.2		28.7
Recreation		42.5		42.5
Total goodwill	$	157.3	$	159.8

The change in the net carrying value amount of goodwill consisted of the following:

	Nine Months Ended July 31,
	2020			2019
Balance at beginning of period	$	159.8		$	161.8
Activity during the period:
Acquisitions		—			(2.0	)
Divestitures		(2.5	)		—
Balance at end of period	$	157.3		$	159.8

Intangible assets (excluding goodwill) consisted of the following:

	July 31, 2020
	Weighted- Average Life		Gross		Accumulated Amortization			Net
Finite-lived intangible assets:
Customer relationships		8.0	$	69.8	$	(37.9	)	$	31.9
Non-compete agreements		5.0		2.0		(1.7	)		0.3
Trade names		7.0		1.3		(1.3	)		—
				73.1		(40.9	)		32.2
Indefinite-lived trade names				110.1		—			110.1
Total intangible assets, net			$	183.2	$	(40.9	)	$	142.3

	October 31, 2019
	Weighted- Average Life		Gross		Accumulated Amortization			Net
Finite-lived intangible assets:
Customer relationships		8.0	$	126.7	$	(84.0	)	$	42.7
Order backlog		1.0		6.7		(6.7	)		—
Non-compete agreements		5.0		2.0		(1.3	)		0.7
Trade names		7.0		3.5		(3.0	)		0.5
Technology-related		7.0		0.9		(0.8	)		0.1
				139.8		(95.8	)		44.0
Indefinite-lived trade names				115.9		—			115.9
Total intangible assets, net			$	255.7	$	(95.8	)	$	159.9

Divestiture Activities

9 Months Ended

Jul. 31, 2020

Discontinued Operations And Disposal Groups [Abstract]

Divestiture Activities

Note 8. Divestiture Activities

Long-Term Debt

9 Months Ended

Jul. 31, 2020

Debt Disclosure [Abstract]

Long-Term Debt

Note 9. Long-Term Debt

The Company was obligated under the following debt instruments:

	July 31, 2020			October 31, 2019
April 2017 ABL facility	$	223.0		$	210.0
Term Loan, net of debt issuance costs ($2.0 and $2.2)		167.4			170.2
		390.4			380.2
Less: current maturities		(1.7	)		(3.6	)
Long-term debt, less current maturities	$	388.7		$	376.6

April 2017 ABL Facility

The following amendments have been made to the April 2017 ABL Facility:

•

The fair value of the April 2017 ABL Facility approximated book value at both July 31, 2020 and October 31, 2019.

Term Loan

The lenders under the Term Loan have a second priority security interest in substantially all accounts receivable and inventory of the Company.

The following amendments have been made to the Term Loan:

•

The Company was in compliance with all financial covenants under the Term Loan as of July 31, 2020.

The fair value of the Term Loan approximated book value at both July 31, 2020 and October 31, 2019.

Warranties

9 Months Ended

Jul. 31, 2020

Guarantees [Abstract]

Warranties

Note 10. Warranties

Changes in the Company’s warranty liability consisted of the following:

	Nine Months Ended July 31,
	2020			2019
Balance at beginning of period	$	22.6		$	30.8
Warranty provisions		27.5			17.3
Settlements made		(25.8	)		(25.1	)
Warranties for current year acquisition		12.2			—
Divestiture adjustments		(0.7	)		—
Changes in liability of pre-existing warranties		(0.3	)		0.1
Balance at end of period	$	35.5		$	23.1

Accrued warranty is classified in the Company’s consolidated balance sheets as follows:

	July 31, 2020		October 31, 2019
Current liabilities	$	23.7	$	16.1
Other long-term liabilities		11.8		6.5
Total warranty liability	$	35.5	$	22.6

Stock Repurchase Program

9 Months Ended

Jul. 31, 2020

Equity [Abstract]

Stock Repurchase Program

Note 11. Stock Repurchase Program

Earnings Per Share

9 Months Ended

Jul. 31, 2020

Earnings Per Share [Abstract]

Earnings Per Share

Note 12. Earnings Per Share

	Three Months Ended July 31,				Nine Months Ended July 31,
	2020		2019		2020		2019
Basic weighted-average common shares outstanding		63,134,486		62,641,436		63,011,955		62,875,677
Dilutive stock options		—		273,717		—		—
Dilutive restricted stock units		—		509,452		—		—
Dilutive performance stock units		—		—		—		—
Diluted weighted-average common shares outstanding		63,134,486		63,424,605		63,011,955		62,875,677

	Three Months Ended July 31,				Nine Months Ended July 31,
	2020		2019		2020		2019
Anti-dilutive stock options		627,600		48,951		779,600		988,551
Anti-dilutive restricted stock units		2,865,583		422,169		3,546,206		1,773,255
Anti-dilutive performance stock units		—		18,408		—		18,408
Anti-dilutive common stock equivalents		3,493,183		489,528		4,325,806		2,780,214

Income Taxes

9 Months Ended

Jul. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Note 13. Income Taxes

Commitments and Contingencies

9 Months Ended

Jul. 31, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 14. Commitments and Contingencies

	July 31, 2020		October 31, 2019
Performance, bid and specialty bonds	$	290.4	$	229.9
Open standby letters of credit		11.9		14.3
Total	$	302.3	$	244.2

The increase in performance, bid and specialty bonds is attributable to municipal contracts within our Commercial segment and customer contracts related to Spartan ER.

Company expects this pattern to continue. The reserve for losses included in other liabilities on contracts outstanding at July 31, 2020 and October 31, 2019 is immaterial.

Business Segment Information

9 Months Ended

Jul. 31, 2020

Segment Reporting [Abstract]

Business Segment Information

Note 15. Business Segment Information

businesses which included Goshen Coach, ElDorado National (Kansas), Federal Coach, Champion and World Trans. Refer to Note 8, Divestiture Activities, for further details.

Selected financial information of the Company’s segments is as follows:

	Three Months Ended July 31, 2020
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	306.7	$	92.4	$	182.7	$	0.4		$	582.2
Depreciation and amortization	$	3.1	$	1.1	$	3.4	$	1.6		$	9.2
Capital expenditures	$	1.0	$	0.3	$	0.2	$	0.5		$	2.0
Total assets	$	766.9	$	205.9	$	309.0	$	127.6		$	1,409.4
Adjusted EBITDA	$	12.9	$	10.3	$	12.1	$	(13.9	)

	Three Months Ended July 31, 2019
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	247.7	$	203.8	$	166.7	$	(1.2	)	$	617.0
Depreciation and amortization	$	3.6	$	2.0	$	3.6	$	1.7		$	10.9
Capital expenditures	$	1.8	$	1.4	$	0.6	$	0.9		$	4.7
Total assets	$	622.8	$	328.5	$	336.6	$	118.2		$	1,406.1
Adjusted EBITDA	$	12.1	$	19.4	$	12.8	$	(10.8	)

	Nine Months Ended July 31, 2020
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	802.4	$	393.8	$	463.6	$	1.5		$	1,661.3
Depreciation and amortization	$	10.2	$	4.7	$	10.2	$	5.8		$	30.9
Capital expenditures	$	5.0	$	1.7	$	1.6	$	1.4		$	9.7
Total assets	$	766.9	$	205.9	$	309.0	$	127.6		$	1,409.4
Adjusted EBITDA	$	25.1	$	28.1	$	17.9	$	(31.5	)

	Nine Months Ended July 31, 2019
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	699.0	$	514.5	$	542.6	$	(5.3	)	$	1,750.8
Depreciation and amortization	$	10.6	$	6.7	$	12.0	$	5.5		$	34.8
Capital expenditures	$	5.0	$	3.1	$	3.0	$	3.0		$	14.1
Total assets	$	622.8	$	328.5	$	336.6	$	118.2		$	1,406.1
Adjusted EBITDA	$	35.8	$	39.7	$	39.4	$	(32.2	)

Provided below is a reconciliation of segment Adjusted EBITDA to net (loss) income:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2020			2019			2020			2019
Fire & Emergency Adjusted EBITDA	$	12.9		$	12.1		$	25.1		$	35.8
Commercial Adjusted EBITDA		10.3			19.4			28.1			39.7
Recreation Adjusted EBITDA		12.1			12.8			17.9			39.4
Corporate and Other Adjusted EBITDA		(13.9	)		(10.8	)		(31.5	)		(32.2	)
Depreciation and amortization		(9.2	)		(10.9	)		(30.9	)		(34.8	)
Interest expense, net		(5.7	)		(8.4	)		(20.3	)		(24.2	)
Benefit (provision) for income taxes		0.5			(1.9	)		13.2			—
Transaction expenses		(0.6	)		(0.5	)		(2.6	)		(0.7	)
Sponsor expense reimbursement		(0.1	)		—			(0.2	)		(0.6	)
Restructuring costs		(2.5	)		(1.3	)		(6.0	)		(4.2	)
Restructuring related charges		(0.7	)		—			(3.9	)		—
Stock-based compensation expense		(1.8	)		(2.5	)		(7.2	)		(7.3	)
Legal matters		(0.1	)		(0.8	)		(1.6	)		(5.3	)
Loss on sale of business		(0.5	)		—			(9.3	)		—
Gain on acquisition of business		—			—			11.9			—
Impairment charges		(3.7	)		—			(3.7	)		(2.8	)
(Losses) earnings attributable to assets held for sale		(0.6	)		(1.0	)		0.8			(3.3	)
Deferred purchase price payment		—			(0.6	)		(0.1	)		(2.8	)
Net (loss) income	$	(3.6	)	$	5.6		$	(20.3	)	$	(3.3	)

Basis of Presentation (Policies)

9 Months Ended

Jul. 31, 2020

Accounting Policies [Abstract]

Recent Accounting Pronouncements

Accounting Pronouncements Recently Adopted

The following accounting pronouncements did not have a material impact on the Company’s consolidated financial statements:

•

Leases (Tables)

9 Months Ended

Jul. 31, 2020

Leases [Abstract]

Schedule of Future Minimum Operating Lease Payments Due Under ASC 842

At July 31, 2020, future minimum operating lease payments due under ASC 842 are summarized by fiscal year in the table below:

Remaining three months of fiscal year 2020	$	2.3
2021		8.7
2022		6.9
2023		4.2
2024		2.4
Thereafter		3.9
Total undiscounted lease payments		28.4
Less: imputed interest		(2.4	)
Total lease liabilities	$	26.0

Schedule of Future Minimum Operating Lease Payments Due Under ASC 840

As of October 31, 2019, future minimum operating lease payments (under ASC 840) summarized by fiscal year were as follows:

2020	$	8.5
2021		7.5
2022		5.8
2023		3.3
2024		1.5
Thereafter		0.1

Acquisition (Tables)

9 Months Ended

Jul. 31, 2020

Business Combinations [Abstract]

Schedule of Preliminary Fair Values of Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed for Spartan ER:

Assets:
Accounts receivable, net	$	30.9
Inventories, net		77.7
Other current assets		2.4
Property, plant and equipment		15.2
Right of use assets		6.0
Total assets acquired		132.2
Liabilities:
Accounts payable		5.0
Customer advances		32.8
Accrued warranty		2.7
Other current liabilities		5.1
Short-term lease obligations		0.8
Deferred income taxes		3.9
Long-term lease obligations		5.4
Other long-term liabilities		9.8
Total liabilities assumed		65.5
Net assets acquired		66.7
Consideration paid		54.8
Gain on acquisition of business	$	(11.9	)

Inventories (Tables)

9 Months Ended

Jul. 31, 2020

Inventory Disclosure [Abstract]

Schedule of Inventories, Net of Reserves

Inventories, net of reserves, consisted of the following:

	July 31, 2020			October 31, 2019
Chassis	$	44.3		$	44.9
Raw materials		211.8			198.1
Work in process		256.6			200.8
Finished products		73.2			79.6
		585.9			523.4
Less: reserves		(13.6	)		(10.0	)
Total inventories, net	$	572.3		$	513.4

Property, Plant and Equipment (Tables)

9 Months Ended

Jul. 31, 2020

Property Plant And Equipment [Abstract]

Summary of Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	July 31, 2020			October 31, 2019
Land & land improvements	$	27.0		$	24.2
Buildings & improvements		104.5			107.6
Machinery & equipment		84.6			93.1
Rental & used vehicles		21.4			24.4
Computer hardware & software		55.6			58.1
Office furniture & fixtures		6.2			5.8
Construction in process		8.0			11.4
		307.3			324.6
Less: accumulated depreciation		(125.0	)		(122.9	)
Total property, plant and equipment, net	$	182.3		$	201.7

Goodwill and Intangible Assets (Tables)

9 Months Ended

Jul. 31, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Summary of Goodwill by Segment and Change in Net Carrying Value of Goodwill

The table below represents goodwill by segment:

	July 31, 2020		October 31, 2019
Fire & Emergency	$	88.6	$	88.6
Commercial		26.2		28.7
Recreation		42.5		42.5
Total goodwill	$	157.3	$	159.8

The change in the net carrying value amount of goodwill consisted of the following:

	Nine Months Ended July 31,
	2020			2019
Balance at beginning of period	$	159.8		$	161.8
Activity during the period:
Acquisitions		—			(2.0	)
Divestitures		(2.5	)		—
Balance at end of period	$	157.3		$	159.8

Summary of Intangible Assets Excluding Goodwill

Intangible assets (excluding goodwill) consisted of the following:

	July 31, 2020
	Weighted- Average Life		Gross		Accumulated Amortization			Net
Finite-lived intangible assets:
Customer relationships		8.0	$	69.8	$	(37.9	)	$	31.9
Non-compete agreements		5.0		2.0		(1.7	)		0.3
Trade names		7.0		1.3		(1.3	)		—
				73.1		(40.9	)		32.2
Indefinite-lived trade names				110.1		—			110.1
Total intangible assets, net			$	183.2	$	(40.9	)	$	142.3

	October 31, 2019
	Weighted- Average Life		Gross		Accumulated Amortization			Net
Finite-lived intangible assets:
Customer relationships		8.0	$	126.7	$	(84.0	)	$	42.7
Order backlog		1.0		6.7		(6.7	)		—
Non-compete agreements		5.0		2.0		(1.3	)		0.7
Trade names		7.0		3.5		(3.0	)		0.5
Technology-related		7.0		0.9		(0.8	)		0.1
				139.8		(95.8	)		44.0
Indefinite-lived trade names				115.9		—			115.9
Total intangible assets, net			$	255.7	$	(95.8	)	$	159.9

Long-Term Debt (Tables)

9 Months Ended

Jul. 31, 2020

Debt Disclosure [Abstract]

Summary of Long-Term Debt

The Company was obligated under the following debt instruments:

	July 31, 2020			October 31, 2019
April 2017 ABL facility	$	223.0		$	210.0
Term Loan, net of debt issuance costs ($2.0 and $2.2)		167.4			170.2
		390.4			380.2
Less: current maturities		(1.7	)		(3.6	)
Long-term debt, less current maturities	$	388.7		$	376.6

Warranties (Tables)

9 Months Ended

Jul. 31, 2020

Guarantees [Abstract]

Schedule of Changes in Warranty Liability

Changes in the Company’s warranty liability consisted of the following:

	Nine Months Ended July 31,
	2020			2019
Balance at beginning of period	$	22.6		$	30.8
Warranty provisions		27.5			17.3
Settlements made		(25.8	)		(25.1	)
Warranties for current year acquisition		12.2			—
Divestiture adjustments		(0.7	)		—
Changes in liability of pre-existing warranties		(0.3	)		0.1
Balance at end of period	$	35.5		$	23.1

Accrued Warranty Classified Consolidated Balance Sheets

Accrued warranty is classified in the Company’s consolidated balance sheets as follows:

	July 31, 2020		October 31, 2019
Current liabilities	$	23.7	$	16.1
Other long-term liabilities		11.8		6.5
Total warranty liability	$	35.5	$	22.6

Earnings Per Share (Tables)

9 Months Ended

Jul. 31, 2020

Earnings Per Share [Abstract]

Reconciliation of Basic Weighted-Average Common Shares Outstanding to Diluted Weighted-Average Shares Outstanding

The table below reconciles basic weighted-average common shares outstanding to diluted weighted-average shares outstanding for the three and nine months ended July 31, 2020 and July 31, 2019:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2020		2019		2020		2019
Basic weighted-average common shares outstanding		63,134,486		62,641,436		63,011,955		62,875,677
Dilutive stock options		—		273,717		—		—
Dilutive restricted stock units		—		509,452		—		—
Dilutive performance stock units		—		—		—		—
Diluted weighted-average common shares outstanding		63,134,486		63,424,605		63,011,955		62,875,677

Exclusions from Calculation of Weighted-Average Shares Outstanding Assuming Dilution Due to Anti-Dilutive Effect of Common Stock Equivalents

	Three Months Ended July 31,				Nine Months Ended July 31,
	2020		2019		2020		2019
Anti-dilutive stock options		627,600		48,951		779,600		988,551
Anti-dilutive restricted stock units		2,865,583		422,169		3,546,206		1,773,255
Anti-dilutive performance stock units		—		18,408		—		18,408
Anti-dilutive common stock equivalents		3,493,183		489,528		4,325,806		2,780,214

Commitments and Contingencies (Tables)

9 Months Ended

Jul. 31, 2020

Commitments And Contingencies Disclosure [Abstract]

Schedule of Contingent Liabilities

The Company is contingently liable under bid, performance and specialty bonds and has open standby letters of credit issued by the Company’s banks in favor of third parties as follows:

	July 31, 2020		October 31, 2019
Performance, bid and specialty bonds	$	290.4	$	229.9
Open standby letters of credit		11.9		14.3
Total	$	302.3	$	244.2

Business Segment Information (Tables)

9 Months Ended

Jul. 31, 2020

Segment Reporting [Abstract]

Selected Financial Information of Segments

Selected financial information of the Company’s segments is as follows:

	Three Months Ended July 31, 2020
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	306.7	$	92.4	$	182.7	$	0.4		$	582.2
Depreciation and amortization	$	3.1	$	1.1	$	3.4	$	1.6		$	9.2
Capital expenditures	$	1.0	$	0.3	$	0.2	$	0.5		$	2.0
Total assets	$	766.9	$	205.9	$	309.0	$	127.6		$	1,409.4
Adjusted EBITDA	$	12.9	$	10.3	$	12.1	$	(13.9	)

	Three Months Ended July 31, 2019
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	247.7	$	203.8	$	166.7	$	(1.2	)	$	617.0
Depreciation and amortization	$	3.6	$	2.0	$	3.6	$	1.7		$	10.9
Capital expenditures	$	1.8	$	1.4	$	0.6	$	0.9		$	4.7
Total assets	$	622.8	$	328.5	$	336.6	$	118.2		$	1,406.1
Adjusted EBITDA	$	12.1	$	19.4	$	12.8	$	(10.8	)

	Nine Months Ended July 31, 2020
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	802.4	$	393.8	$	463.6	$	1.5		$	1,661.3
Depreciation and amortization	$	10.2	$	4.7	$	10.2	$	5.8		$	30.9
Capital expenditures	$	5.0	$	1.7	$	1.6	$	1.4		$	9.7
Total assets	$	766.9	$	205.9	$	309.0	$	127.6		$	1,409.4
Adjusted EBITDA	$	25.1	$	28.1	$	17.9	$	(31.5	)

	Nine Months Ended July 31, 2019
	Fire & Emergency		Commercial		Recreation		Corporate, Other & Elims			Consolidated
Net sales	$	699.0	$	514.5	$	542.6	$	(5.3	)	$	1,750.8
Depreciation and amortization	$	10.6	$	6.7	$	12.0	$	5.5		$	34.8
Capital expenditures	$	5.0	$	3.1	$	3.0	$	3.0		$	14.1
Total assets	$	622.8	$	328.5	$	336.6	$	118.2		$	1,406.1
Adjusted EBITDA	$	35.8	$	39.7	$	39.4	$	(32.2	)

Reconciliation of Segment Adjusted EBITDA to Net (Loss) Income

Provided below is a reconciliation of segment Adjusted EBITDA to net (loss) income:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2020			2019			2020			2019
Fire & Emergency Adjusted EBITDA	$	12.9		$	12.1		$	25.1		$	35.8
Commercial Adjusted EBITDA		10.3			19.4			28.1			39.7
Recreation Adjusted EBITDA		12.1			12.8			17.9			39.4
Corporate and Other Adjusted EBITDA		(13.9	)		(10.8	)		(31.5	)		(32.2	)
Depreciation and amortization		(9.2	)		(10.9	)		(30.9	)		(34.8	)
Interest expense, net		(5.7	)		(8.4	)		(20.3	)		(24.2	)
Benefit (provision) for income taxes		0.5			(1.9	)		13.2			—
Transaction expenses		(0.6	)		(0.5	)		(2.6	)		(0.7	)
Sponsor expense reimbursement		(0.1	)		—			(0.2	)		(0.6	)
Restructuring costs		(2.5	)		(1.3	)		(6.0	)		(4.2	)
Restructuring related charges		(0.7	)		—			(3.9	)		—
Stock-based compensation expense		(1.8	)		(2.5	)		(7.2	)		(7.3	)
Legal matters		(0.1	)		(0.8	)		(1.6	)		(5.3	)
Loss on sale of business		(0.5	)		—			(9.3	)		—
Gain on acquisition of business		—			—			11.9			—
Impairment charges		(3.7	)		—			(3.7	)		(2.8	)
(Losses) earnings attributable to assets held for sale		(0.6	)		(1.0	)		0.8			(3.3	)
Deferred purchase price payment		—			(0.6	)		(0.1	)		(2.8	)
Net (loss) income	$	(3.6	)	$	5.6		$	(20.3	)	$	(3.3	)

Basis of Presentation - Additional Information (Detail) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Primary Equity Holder [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Selling, general and administrative expenses charged by primary equity holder		$ 0.1		$ 0.2	$ 0.6
Primary Equity Holder [Member] \| Maximum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Selling, general and administrative expenses charged by primary equity holder			$ 0.1
Management [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Rent expense		$ 0.1	$ 0.5	$ 0.7	$ 1.5
American Industrial Partners [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Equity interest held by operating partnership, voting equity	53.20%

Revenue Recognition - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Revenue From Contract With Customer [Abstract]
Revenue recognized included in customer advances	$ 23.5	$ 30.0	$ 104.1	$ 94.9

Leases - Additional Information (Detail) $ in Millions	3 Months Ended	9 Months Ended
Leases - Additional Information (Detail) $ in Millions	Jul. 31, 2020 USD ($)	Jul. 31, 2020 USD ($)
Leases [Abstract]
Operating Lease, Cost	$ 2.8	$ 7.6
Operating Lease, Payments	$ 2.3	$ 6.9
Weighted average remaining lease term for operating leases	4 years 8 months 12 days	4 years 8 months 12 days
Weighted average discount rate for operating leases	5.00%	5.00%

Leases - Schedule of Future Minimum Operating Lease Payments Due Under ASC 842 (Detail) $ in Millions	Jul. 31, 2020 USD ($)
Leases [Abstract]
Remaining three months of fiscal year 2020	$ 2.3
2021	8.7
2022	6.9
2023	4.2
2024	2.4
Thereafter	3.9
Total undiscounted lease payments	28.4
Less: imputed interest	(2.4)
Total lease liabilities	$ 26.0

Leases - Schedule of Future Minimum Operating Lease Payments Due Under ASC 840 (Detail) $ in Millions	Oct. 31, 2019 USD ($)
Leases [Abstract]
2020	$ 8.5
2021	7.5
2022	5.8
2023	3.3
2024	1.5
Thereafter	$ 0.1

Acquisition - Additional Information (Detail) - USD ($) $ in Millions		3 Months Ended	9 Months Ended
	Feb. 01, 2020	Jul. 31, 2020	Jul. 31, 2020
Business Acquisition [Line Items]
Gain on acquisition of business			$ 11.9
Spartan Emergency Response [Member]
Business Acquisition [Line Items]
Business acquisition, purchase price	$ 54.8
Gain on acquisition of business	11.9
Net sales		$ 74.5	137.1
Operating income		$ 4.5	$ 5.6
Spartan Emergency Response [Member] \| Selling, General and Administrative Expenses [Member]
Business Acquisition [Line Items]
Acquisition related costs	$ 1.6

Acquisition - Schedule of Preliminary Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions		9 Months Ended
	Feb. 01, 2020	Jul. 31, 2020
Liabilities:
Gain on acquisition of business		$ (11.9)
Spartan Emergency Response [Member]
Assets:
Accounts receivable, net	$ 30.9
Inventories, net	77.7
Other current assets	2.4
Property, plant and equipment	15.2
Right of use assets	6.0
Total assets acquired	132.2
Liabilities:
Accounts payable	5.0
Customer advances	32.8
Accrued warranty	2.7
Other current liabilities	5.1
Short-term lease obligations	0.8
Deferred income taxes	3.9
Long-term lease obligations	5.4
Other long-term liabilities	9.8
Total liabilities assumed	65.5
Net assets acquired	66.7
Consideration paid	54.8
Gain on acquisition of business	$ (11.9)

Inventories - Schedule of Inventories, Net of Reserves (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019
Inventory Disclosure [Abstract]
Chassis	$ 44.3	$ 44.9
Raw materials	211.8	198.1
Work in process	256.6	200.8
Finished products	73.2	79.6
Inventory, Gross, Total	585.9	523.4
Less: reserves	(13.6)	(10.0)
Total inventories, net	$ 572.3	$ 513.4

Property, Plant and Equipment - Summary of Property, Plant and Equipment (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 307.3	$ 324.6
Less: accumulated depreciation	(125.0)	(122.9)
Total property, plant and equipment, net	182.3	201.7
Land and Land Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	27.0	24.2
Building and Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	104.5	107.6
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	84.6	93.1
Rental and Used Vehicles [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	21.4	24.4
Computer Hardware and Software [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	55.6	58.1
Office Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	6.2	5.8
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 8.0	$ 11.4

Property, Plant and Equipment - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Property Plant And Equipment [Abstract]
Depreciation expense	$ 6.2	$ 6.7	$ 20.5	$ 21.5
Impairment charges	$ 3.7		$ 3.7	$ 2.8

Goodwill and Intangible Assets - Summary of Goodwill by Segment (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019	Jul. 31, 2019	Oct. 31, 2018	Jul. 31, 2018	Oct. 31, 2017
Goodwill [Line Items]
Goodwill	$ 157.3	$ 159.8	$ 157.3	$ 159.8	$ 159.8	$ 161.8
Fire & Emergency [Member]
Goodwill [Line Items]
Goodwill	88.6	88.6
Commercial [Member]
Goodwill [Line Items]
Goodwill	26.2	28.7
Recreation [Member]
Goodwill [Line Items]
Goodwill	$ 42.5	$ 42.5

Goodwill and Intangible Assets - Summary of Change in Net Carrying Value of Goodwill (Detail) - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Goodwill And Intangible Assets Disclosure [Abstract]
Balance at beginning of period	$ 159.8	$ 159.8
Acquisitions		(2.0)
Divestitures	(2.5)
Balance at end of period	$ 157.3	$ 157.3

Goodwill and Intangible Assets - Summary of Intangible Assets Excluding Goodwill (Detail) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Jul. 31, 2020	Oct. 31, 2019
Intangible Assets Excluding Goodwill [Line Items]
Finite-lived intangible assets, gross	$ 73.1	$ 139.8
Finite-lived intangible assets, accumulated amortization	(40.9)	(95.8)
Finite-lived intangible assets, net	32.2	44.0
Indefinite-lived trade names	110.1	115.9
Total intangible assets, gross	183.2	255.7
Total intangible assets, net	$ 142.3	$ 159.9
Customer Relationships [Member]
Intangible Assets Excluding Goodwill [Line Items]
Finite-lived intangible assets, Weighted-Average Life	8 years	8 years
Finite-lived intangible assets, gross	$ 69.8	$ 126.7
Finite-lived intangible assets, accumulated amortization	(37.9)	(84.0)
Finite-lived intangible assets, net	$ 31.9	$ 42.7
Order Backlog [Member]
Intangible Assets Excluding Goodwill [Line Items]
Finite-lived intangible assets, Weighted-Average Life		1 year
Finite-lived intangible assets, gross		$ 6.7
Finite-lived intangible assets, accumulated amortization		$ (6.7)
Non-compete Agreements [Member]
Intangible Assets Excluding Goodwill [Line Items]
Finite-lived intangible assets, Weighted-Average Life	5 years	5 years
Finite-lived intangible assets, gross	$ 2.0	$ 2.0
Finite-lived intangible assets, accumulated amortization	(1.7)	(1.3)
Finite-lived intangible assets, net	$ 0.3	$ 0.7
Trade Names [Member]
Intangible Assets Excluding Goodwill [Line Items]
Finite-lived intangible assets, Weighted-Average Life	7 years	7 years
Finite-lived intangible assets, gross	$ 1.3	$ 3.5
Finite-lived intangible assets, accumulated amortization	$ (1.3)	(3.0)
Finite-lived intangible assets, net		$ 0.5
Technology-related Intangible Assets [Member]
Intangible Assets Excluding Goodwill [Line Items]
Finite-lived intangible assets, Weighted-Average Life		7 years
Finite-lived intangible assets, gross		$ 0.9
Finite-lived intangible assets, accumulated amortization		(0.8)
Finite-lived intangible assets, net		$ 0.1

Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Goodwill And Intangible Assets Disclosure [Abstract]
Amortization expense	$ 3.0	$ 4.1	$ 10.4	$ 13.3

Divestiture Activities - Additional Information (Detail) - USD ($) $ in Millions		3 Months Ended				9 Months Ended
	May 08, 2020	Jul. 31, 2020	Jan. 31, 2020	Apr. 30, 2019	Jan. 31, 2019	Jul. 31, 2020	Apr. 30, 2020	Oct. 31, 2019
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Net cash proceeds from sale of business						$ 50.9
Gain (loss) on sale of business		$ (0.5)				(9.3)
REV Coach Segment [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Net cash proceeds from sale of business			$ 1.1
Expected proceeds to be received from divestiture of businesses next three months							$ 0.9
Property, plant and equipment, net								$ 0.2
Inventories, net								14.0
Accounts receivable, net								0.4
Other current and long-term assets								4.9
Accounts payable								11.7
Other current and long-term liabilities								$ 3.7
Mobility Van Business [Member] \| Commercial Segment [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Annual sales of discontinued operation					$ 40.0
Regional Technical Center [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Net cash proceeds from sale of business				$ 11.4
Gain (loss) on sale of business				$ 1.2
Shuttle Bus Businesses [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Net cash proceeds from sale of business	$ 48.9
Gain (loss) on sale of business						$ 9.3

Long-Term Debt - Summary of Long-Term Debt (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019
Debt Instruments [Abstract]
April 2017 ABL facility	$ 223.0	$ 210.0
Term Loan, net of debt issuance costs ($2.0 and $2.2)	167.4	170.2
Long term debt including current maturities	390.4	380.2
Less: current maturities	(1.7)	(3.6)
Long-term debt, less current maturities	$ 388.7	$ 376.6

Long-Term Debt - Summary of Long-Term Debt (Parenthetical) (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Apr. 29, 2020	Jan. 31, 2020	Oct. 31, 2019	Oct. 18, 2019	Mar. 29, 2019	Jul. 18, 2018	Apr. 25, 2017
Debt Instrument [Line Items]
Debt issuance costs		$ 0.2	$ 0.4		$ 0.2
Term Loan [Member]
Debt Instrument [Line Items]
Debt issuance costs	$ 2.0			$ 2.2		$ 0.8	$ 0.6	$ 2.0

Long-Term Debt - Additional Information (Detail) - USD ($)					9 Months Ended
	Mar. 29, 2019	Jul. 18, 2018	Dec. 22, 2017	Apr. 25, 2017	Jul. 31, 2020	Jan. 31, 2022	Oct. 31, 2021	Jul. 31, 2021	Jan. 31, 2021	Apr. 29, 2020	Jan. 31, 2020	Jan. 30, 2020	Oct. 31, 2019	Oct. 18, 2019	Oct. 17, 2019
Debt Instrument [Line Items]
Debt issuance costs										$ 200,000	$ 400,000			$ 200,000
Secured leverage declined basis points					0.25%
Secured leverage increased basis points										0.75%
Minimum [Member]
Debt Instrument [Line Items]
Secured leverage net ratio										1.25%
Maximum [Member]
Debt Instrument [Line Items]
Secured leverage net ratio											5.00%	4.00%		4.00%	3.50%
Maximum [Member] \| Scenario, Forecast
Debt Instrument [Line Items]
Secured leverage net ratio						4.25%	3.75%	3.50%	5.25%
April 2017 Asset Based Lending Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity				$ 350,000,000.0
Debt issuance costs			$ 400,000	4,900,000							$ 400,000
Additional increase in borrowing capacity				$ 100,000,000.0
Debt instrument maturity date				Apr. 25, 2022
Additional increase in borrowing capacity			$ 100,000,000.0
Weighted-average interest rate					2.11%
Available current borrowing capacity					$ 220,600,000
April 2017 Asset Based Lending Facility [Member] \| Base Rate [Member]
Debt Instrument [Line Items]
Debt instrument applicable interest rate margins			0.75%
April 2017 Asset Based Lending Facility [Member] \| Eurodollar [Member]
Debt Instrument [Line Items]
Debt instrument applicable interest rate margins			1.75%
Required annual payment percentage			0.00%
April 2017 Asset Based Lending Facility [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 350,000,000.0								450,000,000.0
April 2017 Asset Based Lending Facility [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 450,000,000.0								$ 500,000,000.0
Fixed charge coverage ratio					100.00%
April 2017 Asset Based Lending Facility [Member] \| Swing Lines Loan [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity				$ 30,000,000.0
April 2017 Asset Based Lending Facility [Member] \| Letter of Credit [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity				35,000,000.0
Term Loan [Member]
Debt Instrument [Line Items]
Debt issuance costs	$ 800,000	$ 600,000		2,000,000.0	$ 2,000,000.0								$ 2,200,000
Debt instrument maturity date					Apr. 25, 2022
Additional increase in borrowing capacity	50,000,000.0	50,000,000.0
Required annual payment percentage					0.25%
Weighted-average interest rate					5.25%
Debt principal amount				$ 75,000,000.0
Term Loan [Member] \| Base Rate [Member]
Debt Instrument [Line Items]
Debt instrument applicable interest rate margins				3.25%
Debt instrument frequency of payment					Quarterly
Term Loan [Member] \| Eurodollar [Member]
Debt Instrument [Line Items]
Debt instrument applicable interest rate margins				4.25%
Debt instrument , floor interest rate				1.00%
Debt instrument frequency of payment					Monthly or Quarterly
Term Loan [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	125,000,000.0	75,000,000.0
Term Loan [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 175,000,000.0	$ 125,000,000.0
Additional increase in borrowing capacity					$ 125,000,000.0

Warranties - Schedule of Changes in Warranty Liability (Detail) - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Guarantees [Abstract]
Balance at beginning of period	$ 22.6	$ 30.8
Warranty provisions	27.5	17.3
Settlements made	(25.8)	(25.1)
Warranties for current year acquisition	12.2
Divestiture adjustments	(0.7)
Changes in liability of pre-existing warranties	(0.3)	0.1
Balance at end of period	$ 35.5	$ 23.1

Warranties - Accrued Warranty Classified Consolidated Balance Sheets (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019	Jul. 31, 2019	Oct. 31, 2018
Guarantees [Abstract]
Current liabilities	$ 23.7	$ 16.1
Other long-term liabilities	11.8	6.5
Total warranty liability	$ 35.5	$ 22.6	$ 23.1	$ 30.8

Stock Repurchase Program - Additional Information (Detail) - USD ($)			3 Months Ended			9 Months Ended	12 Months Ended
	Sep. 05, 2018	Mar. 20, 2018	Jul. 31, 2020	Jul. 31, 2019	Apr. 30, 2019	Jul. 31, 2020	Oct. 31, 2019
Equity Class Of Treasury Stock [Line Items]
Stock repurchase program, total cost				$ 3,000,000.0	$ 5,300,000
Common Stock [Member]
Equity Class Of Treasury Stock [Line Items]
Stock repurchase program, authorized amount to repurchase issued and outstanding common stock	$ 50,000,000.0
Stock repurchase program, expiration date	Sep. 04, 2020	Mar. 19, 2020
Stock repurchase program, number of remaining shares purchased			0	222,122	495,475	0	717,597
Stock repurchase program, total cost							$ 8,300,000
Stock repurchase program, average price per share							$ 11.62
Stock repurchase program, remaining authorized, amount			$ 38,300,000			$ 38,300,000
Common Stock [Member] \| Maximum [Member]
Equity Class Of Treasury Stock [Line Items]
Stock repurchase program, authorized amount to repurchase issued and outstanding common stock		$ 50,000,000.0

Earnings per Share - Reconciliation of Basic Weighted-Average Common Shares Outstanding to Diluted Weighted-Average Shares Outstanding (Detail) - shares	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Earnings Per Share [Abstract]
Basic weighted-average common shares outstanding	63,134,486	62,641,436	63,011,955	62,875,677
Dilutive stock options	0	273,717	0	0
Dilutive restricted stock units	0	509,452	0	0
Dilutive performance stock units	0	0	0	0
Diluted weighted-average common shares outstanding	63,134,486	63,424,605	63,011,955	62,875,677

Earnings per Share - Exclusions from Calculation of Weighted-Average Shares Outstanding Assuming Dilution Due to Anti-Dilutive Effect of Common Stock Equivalents (Detail) - shares	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents	3,493,183	489,528	4,325,806	2,780,214
Stock Options [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents	627,600	48,951	779,600	988,551
Restricted Stock Units [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents	2,865,583	422,169	3,546,206	1,773,255
Performance Stock Units [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents	0	18,408	0	18,408

Income Taxes - Additional Information (Detail) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
	Dec. 31, 2017	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019	Oct. 31, 2019	Oct. 31, 2018
Income Tax Disclosure [Line Items]
Net operating loss carryforwards							$ 3.5
Estimate income tax effects due to CARES Act		$ 3.5
Federal statutory income tax rate	35.00%			21.00%
Income tax expense (benefit)		$ (0.5)	$ 1.9	$ (13.2)
Pre-tax (income) loss		11.60%	(25.70%)	39.40%	(0.20%)
Net discrete tax expense (benefit) related to net operating loss carrybacks		$ (0.8)		$ (4.6)
Net discrete tax expense (benefit) related to share-based compensation			$ 0.1		$ 0.8
Unrecognized tax benefits		2.8		2.8		$ 2.6
Unrecognized tax benefits that would affect the annual effective income tax rate if recognized		$ 0.4		$ 0.4
Maximum [Member]
Income Tax Disclosure [Line Items]
Income tax expense (benefit)					$ 0.1

Commitments and Contingencies - Schedule of Contingent Liabilities (Detail) - USD ($) $ in Millions	Jul. 31, 2020	Oct. 31, 2019
Commitments And Contingencies Disclosure [Abstract]
Performance, bid and specialty bonds	$ 290.4	$ 229.9
Open standby letters of credit	11.9	14.3
Total	$ 302.3	$ 244.2

Commitments and Contingencies - Additional Information (Detail) - USD ($)	9 Months Ended	12 Months Ended
	Jul. 31, 2020	Oct. 31, 2019
Loss Contingencies [Line Items]
Contingent liability under purchase agreements for future chassis inventory purchases	$ 42,600,000	$ 48,600,000
Repurchase agreement	2 years
Represents the gross value of all vehicles under repurchase agreements	$ 163,600,000	212,500,000
Maximum [Member]
Loss Contingencies [Line Items]
Estimated loss exposure under contract	$ 22,500,000	$ 25,500,000

Business Segment Information - Additional Information (Detail)	9 Months Ended
	Jul. 31, 2020 Segment
Segment Reporting [Abstract]
Number of reportable segments	3

Business Segment Information - Schedule of Selected Financial Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2020	Jul. 31, 2019	Jul. 31, 2020	Jul. 31, 2019	Oct. 31, 2019
Segment Reporting Information [Line Items]
Net sales	$ 582.2	$ 617.0	$ 1,661.3	$ 1,750.8
Depreciation and amortization	9.2	10.9	30.9	34.8
Capital expenditures	2.0	4.7	9.7	14.1
Total assets	1,409.4	1,406.1	1,409.4	1,406.1	$ 1,347.1
Operating Segment [Member] \| Fire & Emergency [Member]
Segment Reporting Information [Line Items]
Net sales	306.7	247.7	802.4	699.0
Depreciation and amortization	3.1	3.6	10.2	10.6
Capital expenditures	1.0	1.8	5.0	5.0
Total assets	766.9	622.8	766.9	622.8
Adjusted EBITDA	12.9	12.1	25.1	35.8
Operating Segment [Member] \| Commercial [Member]
Segment Reporting Information [Line Items]
Net sales	92.4	203.8	393.8	514.5
Depreciation and amortization	1.1	2.0	4.7	6.7
Capital expenditures	0.3	1.4	1.7	3.1
Total assets	205.9	328.5	205.9	328.5
Adjusted EBITDA	10.3	19.4	28.1	39.7
Operating Segment [Member] \| Recreation [Member]
Segment Reporting Information [Line Items]
Net sales	182.7	166.7	463.6	542.6
Depreciation and amortization	3.4	3.6	10.2	12.0
Capital expenditures	0.2	0.6	1.6	3.0
Total assets	309.0	336.6	309.0	336.6
Adjusted EBITDA	12.1	12.8	17.9	39.4
Corporate, Other and Elims [Member]
Segment Reporting Information [Line Items]
Net sales	0.4	(1.2)	1.5	(5.3)
Depreciation and amortization	1.6	1.7	5.8	5.5
Capital expenditures	0.5	0.9	1.4	3.0
Total assets	127.6	118.2	127.6	118.2
Adjusted EBITDA	$ (13.9)	$ (10.8)	$ (31.5)	$ (32.2)

Business Segment Information - Reconciliation of Segment Adjusted EBITDA to Net (Loss) Income (Detail) - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Jul. 31, 2020	Apr. 30, 2020	Jan. 31, 2020	Jul. 31, 2019	Apr. 30, 2019	Jan. 31, 2019	Jul. 31, 2020	Jul. 31, 2019
Segment Reporting Information [Line Items]
Interest expense, net	$ (5.7)			$ (8.4)			$ (20.3)	$ (24.2)
Benefit (provision) for income taxes	0.5			(1.9)			13.2
Restructuring costs	(2.5)			(1.3)			(6.0)	(4.2)
Stock-based compensation expense							(7.2)	(7.3)
Loss on sale of business	(0.5)						(9.3)
Gain on acquisition of business							11.9
Impairment charges	(3.7)						(3.7)	(2.8)
Net (loss) income	(3.6)	$ (7.6)	$ (9.4)	5.6	$ 5.6	$ (14.6)	(20.3)	(3.3)
Corporate and Other [Member]
Segment Reporting Information [Line Items]
Adjusted EBITDA	(13.9)			(10.8)			(31.5)	(32.2)
Operating Segment [Member] \| Fire & Emergency [Member]
Segment Reporting Information [Line Items]
Adjusted EBITDA	12.9			12.1			25.1	35.8
Operating Segment [Member] \| Commercial [Member]
Segment Reporting Information [Line Items]
Adjusted EBITDA	10.3			19.4			28.1	39.7
Operating Segment [Member] \| Recreation [Member]
Segment Reporting Information [Line Items]
Adjusted EBITDA	12.1			12.8			17.9	39.4
Reconciling Items [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization	(9.2)			(10.9)			(30.9)	(34.8)
Interest expense, net	(5.7)			(8.4)			(20.3)	(24.2)
Benefit (provision) for income taxes	0.5			(1.9)			13.2
Transaction expenses	(0.6)			(0.5)			(2.6)	(0.7)
Sponsor expense reimbursement	(0.1)						(0.2)	(0.6)
Restructuring costs	(2.5)			(1.3)			(6.0)	(4.2)
Restructuring related charges	(0.7)						(3.9)
Stock-based compensation expense	(1.8)			(2.5)			(7.2)	(7.3)
Legal matters	(0.1)			(0.8)			(1.6)	(5.3)
Loss on sale of business	(0.5)						(9.3)
Gain on acquisition of business							11.9
Impairment charges	(3.7)						(3.7)	(2.8)
(Losses) earnings attributable to assets held for sale	$ (0.6)			(1.0)			0.8	(3.3)
Deferred purchase price payment				$ (0.6)			$ (0.1)	$ (2.8)