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
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
Financial Statements
December 31, 2001
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
Schedule of Assets (Held at End of Year).............................8
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, 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.
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
at end of year) 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, 2002
TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
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.............. $ 51,008,243 $ 51,261,267
Investments........................................ 183,863 301,062
-------------- -------------
51,192,106 51,562,329
-------------- -------------
Receivables:
Employee contributions......................... 179,791 234,223
Employer contributions......................... 55,905 99,657
-------------- -------------
Total receivables......................... 235,696 333,880
-------------- -------------
LIABILITIES:
Accounts payable............................... --- 35,449
-------------- -------------
NET ASSETS AVAILABLE FOR BENEFITS.................. $ 51,427,802 $ 51,860,760
============== =============
See accompanying notes to financial statements.
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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, 2001
--------------------------------------------------------------------------------
ADDITIONS:
Plan interest in Terex Corporation 401(k) Retirement
Savings Plan Master Trust................................... $ (2,749,832)
Net depreciation in fair value of investments................ (42,113)
Employee contributions....................................... 4,625,545
Employer contributions....................................... 1,825,526
Rollover contributions....................................... 646,932
--------------
Total additions......................................... 4,306,058
--------------
DEDUCTIONS:
Withdrawals.................................................. 4,713,723
Administrative fees.......................................... 25,293
--------------
Total deductions........................................ 4,739,016
--------------
NET DECREASE............................................ (432,958)
NET ASSETS AVAILABLE FOR BENEFITS AT BEGINNING OF YEAR........... 51,860,760
--------------
NET ASSETS AVAILABLE FOR BENEFITS AT END OF YEAR................. $ 51,427,802
==============
See accompanying notes to financial statements.
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN
The following description of the Terex Corporation and Affiliates'
401(k) Retirement Saving Plan (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
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 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.
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
20% of their compensation to the Plan in any combination of pre-tax or
post-tax earnings. The maximum pre-tax contribution permitted under the
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 - The Company contributes 50% of the first 8% of
base compensation that a participant contributes to the Plan. The
matching Company contribution is invested directly 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.
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 $3,500 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.
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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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 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.
3. INVESTMENTS
The following presents the investments that represent 5 percent of 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 $ 51,008,243 $ 51,261,267
During 2001, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
depreciated in value by $42,113 as follows:
Mutual Funds $ 42,113
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 asset of the Master Trust was approximately
89.4% and 89.4%, 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.
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
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
=============== =================
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 $8,309,783, respectively. The contract value
represents contributions made under contract, plus earnings, less
participant withdrawals and administrative expenses. Participants may
ordinarily direct the withdrawal or transfer of all or a portion of the
investment at contract value. The guaranteed annual interest rate is 6
percent.
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TEREX CORPORATION AND AFFILIATES'
401(k) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
5. NONPARTICIPANT-DIRECTED INVESTMENTS
The Company's contributions to the Plan are invested solely in Terex
Corporation Common Stock. Fidelity holds all Terex common stock in one
investment account and does not segregate employer and employee
purchased common stock activity. As a result, all Plan investments in
Terex common stock are considered nonparticipant-directed. Information
about the net assets and the significant components of the changes in
net assets relating to the nonparticipant-directed investments is as
follows:
December 31,
--------------------------
2001 2000
------------ ------------
Net Assets:
Terex Corporation Common Stock.........$ 5,760,071 $ 4,910,172
Year Ended
December 31, 2001
---------------------
Changes in Net Assets:
Contributions.................................. $ 2,078,238
Investment income and gain/loss................ 445,977
Transfer from participant-directed investments. 117,543
Withdrawals.................................... (498,001)
Net loan activity.............................. (22,679)
Expenses paid.................................. (222)
Transfer to participant-directed investments... (1,250,332)
Forfeitures.................................... (20,625)
---------------------
$ 849,899
=====================
6. PARTY-IN-INTEREST
Certain Plan investments are shares of mutual funds and are 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 $25,293 for
the year ended December 31, 2001.
7. 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.
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 as
directed by the Trustees.
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TEREX CORPORATION AND AFFILIATES'
401(K) RETIREMENT SAVINGS PLAN
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
AS OF DECEMBER 31, 2001
--------------------------------------------------------------------------------
Fair Value /
Description Contract Value
----------------------------------------------------------- ------------------
MUTUAL FUNDS:
Fidelity Growth Company Fund............................. $ 102,441
Fidelity Growth and Income Fund.......................... 42,131
Fidelity Magellan Fund................................... 25,427
Fidelity Balanced Fund................................... 13,864
------------------
TOTAL ASSETS HELD FOR INVESTMENT PURPOSES $ 183,863
==================
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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, 2002 By: Joseph F. Apuzzo
Chief Financial Officer
Terex Corporation
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EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 33-00949) of Terex Corporation of our report dated
June 26, 2002 relating to the financial statements of the Terex Corporation and
Affiliates 401(k) Retirement Savings Plan, which appears in this Form 11-K.
PricewaterhouseCoopers LLP
Stamford, CT
June 27, 2002
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