UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________ to __________
Commission file number ____________________
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
The Terex Corporation and Affiliates' 401(k) Retirement Savings Plan
for Represented Employees
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
Terex Corporation
500 Post Road East, Suite 320
Westport, Connecticut 06880
<PAGE>
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
FOR REPRESENTED EMPLOYEES
Financial Statements
December 31, 1999
<PAGE>
TEREX CORPORATION AND AFFILIATES' 401(k)
RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
INDEX
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Page
REPORT OF INDEPENDENT ACCOUNTANTS............................................1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits.....................2
Statement of Changes in Net Assets Available for Benefits...........3
Notes to Financial Statements...................................4 - 7
SUPPLEMENTAL SCHEDULES:
Assets Held for Investment Purposes.................................8
Reportable Transactions.............................................9
<PAGE>
Report of Independent Accountants
To the Participants and Administrative Committee of the
Terex Corporation and Affiliates'
401(k) Retirement Savings Plan for Represented Employees
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Terex Corporation and Affiliates' 401(k) Retirement Savings Plan for
Represented Employees (the "Plan") at December 31, 1999 and 1998, and the
changes in net assets available for benefits for the year ended December 31,
1999, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Plan's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes and reportable transactions are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. These supplemental
schedules are the responsibility of the Plan's management. The supplemental
schedules have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
PricewaterhouseCoopers LLP
Stamford, Connecticut
June 26, 2000
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31
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1999 1998
------------- ------------
ASSETS:
Investments.......................................$ 5,439,137 $ 2,680,031
------------- ------------
Receivables:
Employee contributions...................... 57,829 22,834
Employer contributions...................... 17,378 4,610
------------- ------------
Total receivables....................... 75,207 27,444
------------- ------------
NET ASSETS AVAILABLE FOR BENEFITS.....................$ 5,514,344 $ 2,707,475
============= ============
See accompanying notes to financial statements.
2
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STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999
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ADDITIONS:
Investment income............................................. $ 124,426
Employee contributions........................................ 872,336
Employer contributions........................................ 180,518
Rollover contributions........................................ 125,996
Transfer from other plan...................................... 1,660,018
------------
Total additions.......................................... 2,963,294
DEDUCTIONS:
Withdrawals................................................... 502,611
Administrative fees........................................... 4,830
------------
Total deductions......................................... 507,441
NET APPRECIATION IN AGGREGATE FAIR VALUE OF INVESTMENTS........... 351,016
------------
NET INCREASE............................................. 2,806,869
NET ASSETS AVAILABLE FOR BENEFITS
Beginning of period........................................... 2,707,475
------------
End of period................................................. $ 5,514,344
============
See accompanying notes to financial statements.
3
<PAGE>
NOTES TO FINANCIAL STATEMENTS
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1. DESCRIPTION OF THE PLAN
General - The Terex Corporation and Affiliates' 401(k) Retirement
Savings Plan for Represented Employees (the "Plan") was established on
January 1, 1987. The Plan is a defined contribution plan that covers
certain eligible employees of Terex Corporation and its subsidiaries
("Terex" or the "Company") meeting minimum eligibility requirements.
Certain officers of Terex serve as trustees of the Plan (the
"Trustees"). The investments of the Plan are held by Massachusetts
Mutual Life Insurance Company ("Mass Mutual").
On July 31, 1998, the Company completed the acquisition of the American
Crane Corporation ("American Crane"). The American Crane employees
covered by a negotiated collective bargaining agreement became eligible
for participation in the Plan during February 1999. Assets valued at
$1,660,018 were transferred into the Plan from the American Crane
Corporation Savings and Investment 401(k) Plan.
On August 26, 1999, the Company completed the acquisition of
Cedarapids, Inc. ("Cedarapids"). The Cedarapids employees covered by a
negotiated collective bargaining agreement became eligible for
participation in the Plan during September 1999. Prior to September 1,
1999, Cedarapids employees participated in the Raytheon Savings and
Investment Plan (the "Raytheon Plan"). All amounts contributed by
Cedarapids employees to the Raytheon Plan are to remain in the Raytheon
Plan until directed otherwise by each individual Cedarapids employee.
In addition to the American Crane and Cedarapids employees,
participants of the Plan are the hourly-rate employees of the Company's
PPM Cranes ("PPM") Unit, Unit Rig division ("Unit Rig"), the Terex
Parts Distribution Center ("Southaven"), and the former Bowerston
Division of Simon Access ("Bowerston"), which was closed subsequent to
the acquisition of the business on April 7, 1997. Investments of the
former Bowerston employees remain in the Plan, however, there are no
additional employee or employer contributions being made. Terms for
each subsidiary location are negotiated under separate collective
bargaining agreements and differ with respect to participant
contributions, employer contributions and loans to participants. The
general provisions for each location are discussed below.
The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA).
An Administrative Committee, consisting of at least three members
appointed by the Company's Board of Directors, administers the benefit
structure of the Plan. The Company is considered the Plan Administrator
for purposes of ERISA.
Participant Eligibility- Employees at Unit Rig are eligible to
participate in the Plan after they complete six months of service,
employees at Southaven and PPM are eligible to participate after three
months of service. Employees at American Crane and Cedarapids are
eligible to participate in the Plan on the date on which they perform
an hour of service as an employee.
Participant Contributions - Participants at Unit Rig may contribute up
to 20% of their compensation, participants at Southaven, PPM, American
Crane and Cedarapids may contribute up to 16% of their compensation.
Contributions may be in any combination of pre or post-tax earnings.
The maximum pre-tax contribution permitted under Internal Revenue
Service regulations in 1999 was $10,000. There is no limit to post-tax
contributions. Participants are able to direct current contributions
and redistribute accumulated contributions and earnings between
investment funds.
4
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NOTES TO FINANCIAL STATEMENTS
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1. DESCRIPTION OF THE PLAN (continued)
Employer Contributions - The plan in effect at Unit Rig does not
provide for Terex to match any portion of employee contributions to the
Plan. The plan in effect at Southaven provides that Terex will match
50% of the first 6% of the employee's salary that is contributed to the
plan. The plan in effect at PPM provides that Terex will match 50% of
the first 5% of the employee's salary that is contributed to the plan.
The plan in effect at American Crane provides that Terex will match 50%
of the employees contribution, the company match shall not exceed $675
in any Plan Year. The plan in effect at Cedarapids provides that Terex
will match 100% of the first 4% of the employee's salary that is
contributed to the plan. The terms of each division's collective
bargaining agreement provides that the Company may make, in its sole
discretion, supplementary contributions. All Company contributions are
made in Terex Common Stock.
Vesting - All participants are immediately fully vested in their
voluntary contributions plus any actual earnings thereon. Participants
at Southaven, PPM, American Crane and Cedarapids vest in the employer
matching contributions after one year of eligible service. Participants
employed at Bowerston on April 7, 1997 are fully vested in employer
contributions. Bowerston participants hired after April 7, 1997 but
prior to the closure of the facility vest in employer contributions
after one year of eligible service. The vesting period for supplemental
contributions is determined by the Company at the time of contribution.
Forfeitures - Nonvested employer contributions of employees that have
separated from the Company become forfeitures and are held in a
separate account and shall be used to reduce future employer
contributions. However, employees that return to service within five
years from their separation date will be entitled to continue vesting
on the employer contributions which were previously forfeited.
Allocation of Earnings - Each participant's account is credited with
contributions and an allocation of earnings from the respective
investment funds. A participant's contributions are used to purchase
shares in the various investment funds. The value of and the earnings
credited to a participant's account are based on the proportionate
number of shares owned by the participant and the fair value of the
investment on the valuation date.
Payment of Benefits - Upon retirement, disability, or death, the entire
balance of the participant's account becomes payable to the participant
or designated beneficiary. Upon any other termination of employment,
the participant receives the vested portion of his/her account;
however, if the vested portion of the participant's account is greater
than $5,000 he/she can elect to keep the investments in the Plan.
Withdrawals are also permitted for financial hardship, as defined by
the Plan, or upon attainment of age 59-1/2.
Participant Loans - Participants may obtain loans in an amount up to
the lesser of $50,000 or 50% of the vested portion of their account
balance, subject to the discretion of the Plan Administrator and
certain other restrictions. Terms of all loans are established by the
Plan Administrator.
The above brief description of the Plan is intended to give a general
summary of the principal provisions of the Plan. Further information
about the Plan is contained in the Terex Corporation and Affiliates'
401(k) Retirement Savings Plan for Represented Employees Summary Plan
Description. This booklet is available from the Company.
5
<PAGE>
NOTES TO FINANCIAL STATEMENTS
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2. SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The accompanying financial statements have been
prepared on the accrual basis.
Investments - Plan investments are stated at fair value based on
published market prices or other independent sources. Net appreciation
(depreciation) in aggregate fair value of investments is comprised of
all realized and unrealized gains and losses during the year.
Expenses - Fees and expenses related to administering the Plan are
generally paid by Terex.
Withdrawals - Withdrawals are recognized at the time of distribution to
the participant.
Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
3. INVESTMENTS
Investments of the Plan are held and managed by Mass Mutual. The
following presents investments that represent 5 percent or more of the
Plan's net assets.
December 31,
------------------------
1999 1998
----------- ------------
Mass Mutual Group Annuity Contract Fixed Fund....$ 1,483,252 $ 1,047,802
Mass Mutual Value Equity Fund.................... 556,833 219,832
Mass Mutual Growth Fund.......................... 616,646 100,701
Mass Mutual Blue Chip Fund....................... 347,908 -
Terex Corporation Common Stock *................. 633,745 536,196
Loans to Participants............................ 507,217 265,965
* Nonparticipant directed
During 1999, the Plan's investments appreciated (depreciated) in value
by $351,016 as follows:
Mutual funds.................................. $ 353,302
Common stock.................................. (2,286)
-----------------
$ 351,016
=================
6
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NOTES TO FINANCIAL STATEMENTS
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4. NON PARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of the
changes in net assets relating to the nonparticipant-directed
investments is as follows:
December 31,
-----------------------
1999 1998
---------- ------------
Net Assets
Terex Corporation Common Stock................... $ 633,745 $ 536,196
Year Ended December 31,
1999
-----------------------
Changes in Net Assets:
Contributions $ 220,883
Transfer from other plan........................ 18,239
Investment income and gain/loss................. 595
Benefits paid to participants................... (132,916)
Net loan activity............................... (2,394)
Expenses paid................................... (3,543)
Transfers to participant-directed investments... (3,315)
=====================
$ 97,549
=====================
5. INCOME TAX STATUS
The Plan received a determination letter, dated July 31, 1996, that it
met the qualification requirements of Sections 401(c) and 401(k) of the
Internal Revenue Code (the "IRC") and is, therefore exempt from federal
income taxation. Subsequently, the Plan has been amended. The Plan
Administrator believes that the Plan, as amended, continues to be
qualified and exempt from tax under Sections 401(c) and 401(k) of the
IRC.
6. TERMINATION OF THE PLAN
The Company believes that the Plan will continue without interruption
but reserves the right to discontinue the Plan. In the event that such
discontinuance results in the complete or partial termination of the
Plan, the balance in each participant's account will be distributed by
the Trustees.
7. SUBSEQUENT EVENT
Effective February 1, 2000, the Plan was amended to change the
investment manager of the Plan to Fidelity Management Trust Company
("Fidelity") from Mass Mutual. Except for certain amounts invested in
Guaranteed Investment Contracts ("GICs"), all funds held by Mass Mutual
were transferred to Fidelity.
7
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TEREX CORPORATION AND AFFILIATES' 401(k) EIN #38-2863240
RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES PLAN #006
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1999
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Description Fair Value /
Contract Value Cost *
---------------------------------------------------------------------- ---------
MUTUAL FUNDS:
Mass Mutual Group Annuity Contract Fixed Fund...... $ 1,483,252
Mass Mutual Value Equity Fund...................... 556,833
Mass Mutual Destiny Aggressive Fund................ 119,957
Mass Mutual Destiny Conservative Fund.............. 117,032
Mass Mutual Destiny All Equity Fund................ 256,924
Mass Mutual Destiny Moderate Fund.................. 120,464
Mass Mutual Core Bond Fund......................... 23,172
Mass Mutual International Equity Fund.............. 168,282
Mass Mutual Growth Fund............................ 616,646
Mass Mutual Small Cap Value Equity Fund............ 76,348
Mass Mutual Indexed Equity Fund.................... 140,563
Mass Mutual Main Street Fund....................... 105,130
Mass Mutual Equity Growth Fund..................... 62,282
Mass Mutual Blue Chip Fund......................... 347,908
Mass Mutual Mid-Cap Growth......................... 61,098
Mass Mutual MFS Growth Equity...................... 42,284
------------
Total Mutual Funds............................. 4,298,175
COMMON STOCK:
Terex Corporation Common Stock..................... 633,745 $ 460,746
LOANS TO PARTICIPANTS, AT INTEREST RATES
RANGING FROM 7.75% TO 10.50%, MATURING
THROUGH DECEMBER 31, 2004............................. 507,217
------------
TOTAL ASSETS HELD FOR INVESTMENT PURPOSES $ 5,439,137
============
* Cost information is provided only for nonparticipant-directed investments.
8
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SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1999
--------------------------------------------------------------------------------
The following series of transactions were in excess of 5% of the fair value of
Plan assets at the beginning of the Plan year:
Number and
Type of Realized
Description Purchases Sales Transactions Gain/(Loss)
--------------------------------- ------------ -------- ------------ ----------
Terex Corporation Common Stock.. $ 324,116 $ 223,875 * $ 26,493
* Massachusetts Mutual Life Insurance Company, the Plan record keeper, cannot
provide this information.
9
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees have duly caused this annual report to be signed by the undersigned
thereunto duly authorized.
The Terex Corporation and Affiliates'
401(k) Retirement Savings Plan for
Represented Employees
/s/ Joseph F. Apuzzo
--------------------------------------
Date: June 27, 2000 By: Joseph F. Apuzzo
Chief Financial Officer
Terex Corporation
