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, 2001
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
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
FOR REPRESENTED EMPLOYEES
Financial Statements
December 31, 2001
TEREX CORPORATION AND AFFILIATES' 401(k)
RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
INDEX
--------------------------------------------------------------------------------
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 - 8
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, 2001 and 2000, and the
changes in net assets available for benefits for the year ended December 31,
2001, in conformity with accounting principles generally accepted in the United
States of America. 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 auditing standards generally accepted in the
United States of America, 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 our opinion.
PricewaterhouseCoopers LLP
Stamford, Connecticut
June 26, 2002
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31
--------------------------------------------------------------------------------
2001 2000
------------- -------------
ASSETS:
Plan interest in Terex Corporation 401(k)
Retirement Savings Plan Master Trust........... $ 6,005,487 $ 6,097,459
Receivables:
Employee contributions.................... 41,262 22,321
Employer contributions.................... 12,973 5,841
------------- -------------
Total receivables..................... 54,235 28,162
------------- -------------
NET ASSETS AVAILABLE FOR BENEFITS................... $ 6,059,722 $ 6,125,621
============= =============
See accompanying notes to financial statements.
- 2 -
TEREX CORPORATION AND AFFILIATES' 401(k)
RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2001
--------------------------------------------------------------------------------
ADDITIONS:
Plan interest in Terex Corporation 401(k)
Retirement Savings Plan Master Trust.................... $ (280,098)
Employee contributions................................... 826,384
Employer contributions................................... 299,079
Rollover contributions................................... 36,933
---------------
Total additions..................................... 882,298
---------------
DEDUCTIONS:
Withdrawals.............................................. 942,948
Administrative fees...................................... 5,249
---------------
Total deductions.................................... 948,197
---------------
NET DECREASE........................................ (65,899)
NET ASSETS AVAILABLE FOR BENEFITS
Beginning of period...................................... 6,125,621
---------------
End of period............................................ $ 6,059,722
===============
See accompanying notes to financial statements.
- 3 -
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN
The following description of the Terex Corporation and Affiliates'
401(k) Retirement Savings Plan for Represented Employees (the "Plan")
provides only general information. Participants should refer to the
Plan agreement for a more complete description of the Plan's
provisions.
General - 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 Fidelity Management Trust Company
("Fidelity") and Massachusetts Mutual Life Insurance Company
("MassMutual").
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.
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"), the American Crane Corporation
("American Crane"), Cedarapids, Inc. ("Cedarapids"), 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.
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-tax or post-tax
earnings. The maximum pre-tax contribution permitted under Internal
Revenue Service regulations in 2001 was $10,500. 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 - Effective January 1, 2000, the plan in effect
at Unit Rig 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 Southaven provides that Terex will match 50% of the first 6% (8%
effective January 1, 2001) 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% (6% effective April 1, 2001) 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 employee's
contribution, the company match shall not exceed $800 in the 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.
- 4 -
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
Vesting - All participants are immediately fully vested in their
voluntary contributions plus any actual earnings thereon. Participants
at Southaven, PPM, American Crane, Unit Rig 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.
Change in Investment Manager - On February 1, 2000, the Plan was
amended to change the investment manager of the Plan to Fidelity from
MassMutual. Except for certain amounts invested in Guaranteed
Investment Contracts ("GICs"), all funds held by MassMutual were
transferred to Fidelity.
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.
- 5 -
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
3. INVESTMENTS
The following presents investments that represent 5 percent or more of
the Plan's net assets.
December 31,
--------------------------
2001 2000
------------ -------------
Plan's interest in the Terex Corporation 401(k)
Retirement Savings Plan Master Trust.............. $ 6,005,487 $ 6,097,459
4. INVESTMENT IN MASTER TRUST
The Plan's assets are held in a trust account at Fidelity and consist
of an interest in the Terex Corporation 401(k) Retirement Savings Plan
Master Trust (the "Master Trust"). The Master Trust was established to
permit the commingling of the trust assets for similar employee benefit
plans sponsored by the Company. At December 31, 2001 and 2000, the
Plan's interest in the net assets of the Master Trust was approximately
10.5% and 10.6%, respectively.
Net earnings of the Master Trust are allocated daily by Fidelity to
each participant account balance. Net earnings include interest income,
dividend income and net appreciation (depreciation) of investments.
Contributions, benefit payments and expenses are made on a specific
identification basis.
The following table presents the fair values of investments for the
Master Trust:
December 31,
--------------------------------
2001 2000
-------------- ----------------
Mutual funds........................... $ 38,412,094 $ 40,077,234
Terex Corporation Common Stock......... 6,602,776 5,678,833
Participant loans...................... 3,259,125 3,292,876
Insurance contract..................... 8,808,370 8,309,783
-------------- ----------------
$ 57,082,365 $ 57,358,726
============== ================
- 6 -
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
Net appreciation, dividends and interest for the Master Trust for the
year ended December 31, 2001 are as follows:
Net appreciation (depreciation) of investments:
Mutual Funds.................................. $ (5,481,386)
Terex Corporation Common Stock................ 510,572
Dividends......................................... 1,097,701
Interest.......................................... 271,583
GIC interest...................................... 580,071
-------------------
$ (3,021,459)
===================
The Master Trust has an interest in a benefit-responsive investment
contract which is valued at contract value as determined by MassMutual,
the holder of the contract. The contract value at December 31, 2001 and
2000 was $8,808,370 and $8,309,783, respectively. The contract value
represents contributions made under contract, plus earnings, less
participant withdrawals and administrative expenses. Participants may
ordinarily direct the withdrawal or transfer of all or a portion of the
investment at contract value. The guaranteed annual interest rate is 6
percent.
5. NON PARTICIPANT-DIRECTED INVESTMENTS
The Company's contributions to the Plan are invested solely in Terex
Corporation Common Stock. Fidelity holds all Terex common stock in one
investment account and does not segregate employer and employee
purchased common stock activity. As a result, all Plan investments in
Terex common stock are considered nonparticipant-directed. 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,
--------------------------------
2001 2000
---------------- --------------
Net Assets
Terex Corporation Common Stock.............. $ 820,986 $ 768,661
Year Ended
December 31, 2001
-----------------
Changes in Net Assets:
Contributions................................. $ 299,711
Investment income and gain/loss............... 65,914
Transfer from participant-directed investments 10,882
Withdrawals................................... (166,727)
Net loan activity............................. 909
Expenses paid................................. (73)
Transfers to participant-directed investments. (158,291)
----------------
$ 52,325
================
- 7 -
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN FOR REPRESENTED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
6. PARTY-IN-INTEREST
Certain Plan investments are shares of mutual funds managed by
Fidelity. Fidelity also serves as a custodian and, therefore, these
transactions qualify as party-in-interest transactions. Fees paid by
the Plan for the investment management services amounts to $5,249 for
the year ended December 31, 2001.
7. 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.
8. 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.
- 8 -
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, 2002 By: Joseph F. Apuzzo
Chief Financial Officer
Terex Corporation
- 9 -