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
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
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
Financial Statements
December 31, 1999
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
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 SCHEDULE
Assets Held for Investment Purposes................................8
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Report of Independent Accountants
To the Participants and Administrative Committee of the
Terex Corporation and Affiliates
401(k) Retirement Savings Plan
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 (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 schedule of assets held
for investment purposes is presented for the purpose of additional analysis and
is not a required part of the basic financial statements but is 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. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audits of the basic financial statements and, in our opinion, is 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
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31
-----------------------------------------------------------------------------
1999 1998
----------------- ------------------
ASSETS:
Investments:
Investments at fair value.......... $ 51,138,004 $ 37,628,439
Investments at contract value...... 696,672 842,966
----------------- ------------------
Total investments.............. 51,834,676 38,471,405
----------------- ------------------
Receivables:
Employee contributions............. 236,474 156,825
Employer contributions............. 85,741 51,960
----------------- ------------------
Total receivables............. 322,215 208,785
----------------- ------------------
NET ASSETS AVAILABLE FOR BENEFITS...... $ 52,156,891 $ 38,680,190
================= ==================
See accompanying notes to financial statements.
2
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TEREX CORPORATION AND AFFILIATES'
401(K) RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999
-------------------------------------------------------------------------------
ADDITIONS:
Investment income...................................... $ 856,415
Employee contributions................................. 4,627,787
Employer contributions................................. 1,387,582
Rollover contributions................................. 875,304
Transfers from other plans............................. 5,470,327
-----------------
Total additions................................... 13,217,415
-----------------
DEDUCTIONS:
Withdrawals............................................ 4,967,704
Administrative fees.................................... 16,250
-----------------
Total deductions.................................. 4,983,954
-----------------
NET APPRECIATION IN AGGREGATE FAIR VALUE OF INVESTMENTS.... 5,243,240
-----------------
NET INCREASE...................................... 13,476,701
NET ASSETS AT BEGINNING OF YEAR............................ 38,680,190
-----------------
NET ASSETS AVAILABLE FOR BENEFITS AT END OF YEAR........... $ 52,156,891
=================
See accompanying notes to financial statements.
3
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TEREX CORPORATION AND AFFILIATES'
401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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1. DESCRIPTION OF THE PLAN
General - The Terex Corporation and Affiliates' 401(k) Retirement
Savings Plan (the "Plan"), was established on April 1, 1987. The Plan
is a defined contribution plan that covers certain salaried and
non-union hourly 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"), the Principal Financial
Group ("Principal") and Fidelity Management Trust Company ("Fidelity").
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.
On July 31, 1998, the Company completed the acquisition of The American
Crane Corporation ("American Crane"). The non-union employees of
American Crane became eligible for participation in the Plan during
February 1999. Assets valued at $3,566,958 were transferred into the
Plan from The American Crane Corporation Savings and Investment 401(k)
Plan in 1999, with the final transfer occurring on August 25, 1999.
On April 1, 1999, the Company completed the acquisition of Amida
Industries, Inc. ("Amida"). The employees of Amida became eligible for
participation in the Plan during June 1999. Assets valued at $1,903,369
were transferred into the Plan from the Amida Industries, Inc.
Employees' 401(k) Profit Sharing Plan and Trust in June 1999.
On August 26, 1999, the Company acquired Cedarapids, Inc.
("Cedarapids"). Effective September 1, 1999 the non-union employees of
Cedarapids became eligible for participation in the Plan. 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.
Participant Eligibility - Permanent employees may begin participation
on the first day of the month following their hiring.
Participant Contributions - Participants may contribute a maximum of
16% of their compensation to the Plan in any combination of pre or
post-tax earnings. The maximum pre-tax contribution permitted under the
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.
Employer Contributions - During 1999, the Plan provided that Terex
would match 100% of the first 4% of the salary that is contributed to
the Plan for Cedarapids Plan participants; for all other participants,
Terex would match 50% of the first 6% of the salary that is contributed
to the Plan. Effective January 1, 2000, Terex will match 50% of the
first 8% of the salary that is contributed to the Plan for all
participants. The contribution matched by Terex is made in Terex Common
Stock.
Vesting - Participants are immediately fully vested in their voluntary
contributions plus any actual earnings thereon. Participants vest in
the employer contribution after one year of eligible service.
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.
4
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TEREX CORPORATION AND AFFILIATES'
401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN (continued)
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 in
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.
Assets Held by Former Trustees- On April 1, 1995 the investment manager
of the Plan was changed from Fidelity to Mass Mutual. At the time of
the transfer of Plan assets to Mass Mutual, certain participants
elected to maintain existing funds at Fidelity. No additional employee
or employer contributions are allowed to be made to these investments
at Fidelity, nor are participants allowed to obtain loans against these
accounts.
Additionally, certain participants maintain retirement accounts in
Guaranteed Investment Contracts ("GICs") maturing through December 31,
2001 held by Principal, the former custodian of an acquired business.
No additional employee or employer contributions are allowed to be made
to the investments at Principal, nor are participants allowed to obtain
loans against these accounts.
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 Summary Plan Description. This booklet
is available from the Company.
2. SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The accompanying financial statements have been
prepared on the accrual basis.
Investments - Plan investments in mutual funds, common stock and
participant loans are stated at fair value based on published market
prices or other independent sources. The GICs are stated at contract
value which approximates fair value. 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.
5
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TEREX CORPORATION AND AFFILIATES'
401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
3. INVESTMENTS
Investments of the Plan are held and managed by Mass Mutual. The
following presents the investments that represent 5 percent of more of
the Plan's net assets.
December 31,
--------------------------
1999 1998
--------------------------
Mass Mutual Group Annuity Contract Fixed Fund..$ 8,602,247 $ 8,400,151
Mass Mutual Value Equity Fund.................. 4,689,982 4,828,488
Mass Mutual Destiny Aggressive Fund............ 4,308,535 3,572,142
Mass Mutual Destiny All Equity Fund............ 5,193,694 5,059,929
Mass Mutual Destiny Moderate Fund.............. --- 2,165,915
Mass Mutual International Equity Fund.......... 4,515,306 2,333,718
Mass Mutual Growth Fund........................ 5,623,743 3,014,823
Terex Corporation Common Stock*................ 4,435,658 3,582,096
* Nonparticipant-directed
During 1999, the Plan's investments appreciated (depreciated) in value
by $5,243,240 as follows:
Mutual Funds $ 5,260,975
Common Stock (17,735)
-----------------
$ 5,243,240
=================
6
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TEREX CORPORATION AND AFFILIATES'
401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
4. NONPARTICIPANT-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........ $ 4,435,658 $ 3,582,096
Year Ended December
31, 1999
---------------------
Changes in Net Assets
Contributions................................$ 1,337,140
Transfer from other plan..................... 71,860
Investment income and gain/loss.............. (12,273)
Benefits paid to participants................ (339,021)
Net loan activity............................ (21,369)
Expenses paid................................ (9,912)
Transfer to participant-directed investments. (171,864)
Forfeitures.................................. (999)
---------------------
$ 853,562
=====================
5. INCOME TAX STATUS
The Plan received a determination letter, dated July 31, 1995, that it
met the qualification requirements of Sections 401(c) and 401(k) of the
Internal Revenue Code (the "IRC") and that the Plan is 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 as
directed by the Trustees.
7. SUBSEQUENT EVENT
Effective February 1, 2000, the Plan was amended to change the
investment manager of the Plan to Fidelity from Mass Mutual. Except for
certain amounts invested in GICs, all funds held by Mass Mutual were
transferred to Fidelity.
7
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TEREX CORPORATION AND AFFILIATES' EIN# 38-2863240
401(K) RETIREMENT SAVINGS PLAN PLAN# 004
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1999
--------------------------------------------------------------------------------
Description Fair Value /
Contract Value Cost *
---------------------------------------------------- --------------- -----------
MUTUAL FUNDS:
Mass Mutual Group Annuity Contract Fixed Fund.... $ 8,602,247
Mass Mutual Value Equity Fund.................... 4,689,982
Mass Mutual Destiny Aggressive Fund.............. 4,308,535
Mass Mutual Destiny Conservative Fund............ 1,219,780
Mass Mutual Destiny All Equity Fund.............. 5,193,694
Mass Mutual Destiny Moderate Fund................ 2,309,062
Mass Mutual Core Bond Fund....................... 745,909
Mass Mutual International Equity Fund............ 4,515,306
Mass Mutual Growth Fund.......................... 5,623,743
Mass Mutual Small Cap Value Equity Fund.......... 1,344,464
Mass Mutual Indexed Equity Fund.................. 1,192,043
Mass Mutual Main Street Fund..................... 811,760
Mass Mutual Equity Growth Fund................... 257,273
Mass Mutual Blue Chip Fund....................... 2,040,560
Mass Mutual Mid-Cap Growth....................... 654,847
Mass Mutual MFS Growth Equity.................... 409,044
Fidelity Magellan Fund........................... 31,730
Fidelity Growth Company Fund..................... 146,410
Fidelity Growth & Income Fund.................... 47,416
Fidelity Balanced Fund........................... 12,874
---------------
Total Mutual Funds........................... 44,156,679
COMMON STOCK:
Terex Corporation Common Stock................... 4,435,658 $ 3,422,547
INVESTMENT CONTRACTS:
Principal Guaranteed Investment Contracts........ 696,672
LOANS TO PARTICIPANTS, AT INTEREST RATES
RANGING FROM 8.00% TO 11.00%, MATURING
THROUGH DECEMBER 31, 2004.......................... 2,545,667
---------------
TOTAL ASSETS HELD FOR INVESTMENT PURPOSES $ 51,834,676
===============
* Cost information is provided only for nonparticipant-directed investments.
8
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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
/s/ Joseph F. Apuzzo
--------------------------------------
Date: June 27, 2000 By: Joseph F. Apuzzo
Chief Financial Officer
Terex Corporation
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