What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-10-28 compared with 2022-08-03 · 155 added, 117 removed, 636 unchanged (30% of the section changed)

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2022 2021 2022 2021

30 unchanged sentences

(in millions, except par value)

September 30,

2022 December 31,

1 unchanged sentence

Cash and cash equivalents $ 231.7 $ 266.9

Trade receivables (net of allowance of $ 9.3 and $ 9.7 at June 30, 2022 and December 31, 2021, respectively)

Trade receivables (net of allowance of $ 9.0 and $ 9.7 at September 30, 2022 and December 31, 2021, respectively)

Inventories 981.2 813.5

21 unchanged sentences

Common stock, $ 0.01 par value – authorized 300.0 shares;

issued 84.0 and 83.4 shares at June 30, 2022 and December 31, 2021, respectively

issued 84.0 and 83.4 shares at September 30, 2022 and December 31, 2021, respectively

Additional paid-in capital 874.0 860.0

1 unchanged sentence

Accumulated other comprehensive income (loss) ( 401.3 ) ( 228.5 )

Less cost of shares of common stock in treasury – 16.6 and 14.2 shares at June 30, 2022 and December 31, 2021, respectively

Less cost of shares of common stock in treasury – 17.1 and 14.2 shares at September 30, 2022 and December 31, 2021, respectively

( 556.3 ) ( 459.7 )

33 unchanged sentences

67.4 $ 0.9 $ 867.0 $ 1,044.6 $ ( 320.9 ) $ ( 542.7 ) $ 1,048.9

Net income (loss) — — — 81.8 — — 81.8

Other comprehensive income (loss) – net of tax — — — — ( 80.4 ) — ( 80.4 )

Issuance of common stock — — 0.4 — — — 0.4

Compensation under stock-based plans – net — — 6.4 — — — 6.4

Dividends — — 0.2 ( 9.0 ) — — ( 8.8 )

Acquisition of treasury stock ( 0.5 ) — — — — ( 13.6 ) ( 13.6 )

Balance at September 30, 2022

66.9 $ 0.9 $ 874.0 $ 1,117.4 $ ( 401.3 ) $ ( 556.3 ) $ 1,034.7

The accompanying notes are an integral part of these condensed consolidated financial statements .

TEREX CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

(in millions)

Shares Common

27 unchanged sentences

69.2 $ 0.9 $ 844.0 $ 847.0 $ ( 200.0 ) $ ( 458.0 ) $ 1,033.9

Net income (loss) — — — 48.1 — — 48.1

Other comprehensive income (loss) – net of tax — — — — ( 29.3 ) — ( 29.3 )

Issuance of common stock — — 0.2 — — — 0.2

Compensation under stock-based plans – net — — 6.5 — — — 6.5

Dividends — — 0.1 ( 8.5 ) — — ( 8.4 )

Acquisition of treasury stock — — — — — ( 0.2 ) ( 0.2 )

Other — — — — — ( 0.1 ) ( 0.1 )

Balance at September 30, 2021

69.2 $ 0.9 $ 850.8 $ 886.6 $ ( 229.3 ) $ ( 458.3 ) $ 1,050.7

The accompanying notes are an integral part of these condensed consolidated financial statements .

2 unchanged sentences

(in millions)

Six Months Ended

Nine Months Ended

September 30,

Operating Activities

34 unchanged sentences

Basis of Presentation and Principles of Consolidation.

The accompanying unaudited Condensed Consolidated Financial Statements of Terex Corporation and subsidiaries as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

The accompanying unaudited Condensed Consolidated Financial Statements of Terex Corporation and subsidiaries as of September 30, 2022 and for the three and nine months ended September 30, 2022 and 2021 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) for interim financial information and instructions to Form 10-Q and Article 10 of Regulation S-X.

9 unchanged sentences

Except as otherwise disclosed, all such adjustments consist only of those of a normal recurring nature.

Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of results that may be expected for the year ending December 31, 2022.

On April 22, 2022, the Company acquired a 100% ownership interest in Steelweld Fabrications Limited (“Steelweld”), a manufacturer of heavy fabrications based in Northern Ireland, to facilitate manufacturing of certain Materials Processing (“MP”) products.

Total cash consideration was approximately $ 6 million.

The transaction was recorded as a business combination using the acquisition method which requires measurement of identifiable assets acquired and liabilities assumed at their estimated fair values as of the acquisition date.

Goodwill was calculated as the excess of the aggregate of the fair value of the consideration transferred over the fair value of the net assets recognized.

See Note G – “Goodwill and Intangible Assets” for additional information regarding goodwill recognized as a result of the acquisition.

Steelweld’s results of operations are consolidated within the MP segment in the Condensed Consolidated Financial Statements from the date of acquisition.

On July 29, 2022, the Company entered into an Asset and Stock Purchase Agreement to acquire a 100% ownership interest in ProAll International Mfg.

and ProAll UK Limited and related assets (“ProAll”), a manufacturer of volumetric mixers based in Canada.

Total consideration was approximately $ 39 million.

The transaction will be recorded as a business combination using the acquisition method of accounting.

ProAll’s results of operations will be consolidated within the MP segment in the Condensed Consolidated Financial Statements from the date of acquisition.

Cash and cash equivalents include $ 3.7 million at June 30, 2022 and December 31, 2021 which were not immediately available for use.

Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of results that may be expected for the year ending December 31, 2022.

Cash and cash equivalents include $ 3.4 million and $ 3.7 million at September 30, 2022 and December 31, 2021, respectively, which were not immediately available for use.

These consist primarily of cash balances held in escrow to secure various obligations of the Company .

14 unchanged sentences

Provision for credit losses 0.8

Balance as of June 30, 2022

Balance as of September 30, 2022

(1) Includes utilization of established reserves, net of recoveries and the impact of foreign exchange rate changes.

2 unchanged sentences

Reserves are recorded for expected loss over the contractual period of risk exposure.

See Note K – “Litigation and Contingencies” for additional information regarding guarantees issued to financial institutions.

See Note L – “Litigation and Contingencies” for additional information regarding guarantees issued to financial institutions.

Accrued Warranties .

15 unchanged sentences

Foreign exchange effect/other ( 2.8 )

Balance as of June 30, 2022

Balance as of September 30, 2022

Fair Value Measurements.

Assets and liabilities measured at fair value on a recurring basis under the provisions of Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement and Disclosure” (“ASC 820”) include commodity swaps, cross currency swaps and foreign exchange contracts, discussed in Note H – “Derivative Financial Instruments” and debt discussed in Note I – “Long-Term Obligations”.

Assets and liabilities measured at fair value on a recurring basis under the provisions of Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement and Disclosure” (“ASC 820”) include commodity swaps, cross currency swaps and foreign exchange contracts discussed in Note I – “Derivative Financial Instruments” and debt discussed in Note J – “Long-Term Obligations”.

These instruments are valued using observable market data for similar assets and liabilities or the present value of future cash payments and receipts.

14 unchanged sentences

The Company identifies its operating segments according to how business activities are managed and evaluated, and has identified three operating segments:

MP, Aerials and Utilities.

Materials Processing (“MP”), Aerials and Utilities.

As Aerials and Utilities operating segments share similar economic characteristics, these operating segments are aggregated into one operating segment, Aerial Work Platforms (“AWP”).

11 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2022 2021 2022 2021

8 unchanged sentences

Total $ 120.8 $ 74.2 $ 299.2 $ 258.2

September 30,

2022 December 31,

1 unchanged sentence

MP $ 1,687.2 $ 1,648.0

AWP 1,990.6 1,870.8

2,023.8 1,870.8

Corporate and Other / Eliminations ( 734.5 ) ( 655.3 )

Total $ 2,976.5 $ 2,863.5

(1) Increase primarily due to higher inventory and fixed assets.

Sales between segments are generally priced to recover costs plus a reasonable markup for profit, which is eliminated in consolidation.

1 unchanged sentence

Three Months Ended

June 30, 2022

September 30, 2022

Three Months Ended

June 30, 2021

September 30, 2021

MP AWP Corporate and Other / Eliminations Total MP AWP Corporate and Other / Eliminations Total

7 unchanged sentences

(1) Includes intercompany sales and eliminations.

(2) Total sales include $ 564.1 million and $ 522.8 million for the three months ended June 30, 2022 and 2021, respectively, attributable to the U.S., the Company’s country of domicile.

Six Months Ended

June 30, 2022

Six Months Ended

June 30, 2021

(2) Total sales include $ 568.6 million and $ 490.3 million for the three months ended September 30, 2022 and 2021, respectively, attributable to the U.S., the Company’s country of domicile.

Nine Months Ended

September 30, 2022

Nine Months Ended

September 30, 2021

MP AWP Corporate and Other / Eliminations Total MP AWP Corporate and Other / Eliminations Total

7 unchanged sentences

(1) Includes intercompany sales and eliminations.

(2) Total sales include $ 1,051.8 million and $ 938.5 million for the six months ended June 30, 2022 and 2021, respectively, attributable to the U.S., the Company’s country of domicile.

(2) Total sales include $ 1.6 billion and $ 1.4 billion for the nine months ended September 30, 2022 and 2021, respectively, attributable to the U.S., the Company’s country of domicile.

The Company attributes sales to unaffiliated customers in different geographical areas based on the location of the customer.

1 unchanged sentence

Three Months Ended

June 30, 2022

September 30, 2022

Three Months Ended

June 30, 2021

September 30, 2021

MP AWP Corporate and Other / Eliminations Total MP AWP Corporate and Other / Eliminations Total

7 unchanged sentences

(1) Includes other product types, intercompany sales and eliminations.

Six Months Ended

June 30, 2022

Six Months Ended

June 30, 2021

Nine Months Ended

September 30, 2022

Nine Months Ended

September 30, 2021

MP AWP Corporate and Other / Eliminations Total MP AWP Corporate and Other / Eliminations Total

8 unchanged sentences

NOTE C – INCOME TAXES

During the three months ended June 30, 2022, the Company recognized income tax expense of $ 15.1 million on income of $ 89.2 million, an effective tax rate of 16.9 %, as compared to income tax expense of $ 14.4 million on income of $ 86.7 million, an effective tax rate of 16.6 %, for the three months ended June 30, 2021.

The higher effective tax rate for the three months ended June 30, 2022 when compared with the three months ended June 30, 2021 is primarily due to lower favorable discrete benefit in the current quarter largely offset by reduced tax on the geographic distribution of income.

During the six months ended June 30, 2022, the Company recognized income tax expense of $ 27.0 million on income of $ 153.4 million, an effective tax rate of 17.6 %, as compared to income tax expense of $ 22.1 million on income of $ 134.1 million, an effective tax rate of 16.5 %, for the six months ended June 30, 2021.

The higher effective tax rate for the six months ended June 30, 2022 when compared with the six months ended June 30, 2021 is primarily due to lower favorable discrete benefit in the current year period partially offset by reduced U.S.

During the three months ended September 30, 2022, the Company recognized income tax expense of $ 25.6 million on income of $ 107.4 million, an effective tax rate of 23.8 %, as compared to income tax expense of $ 13.9 million on income of $ 61.4 million, an effective tax rate of 22.6 %, for the three months ended September 30, 2021.

The higher effective tax rate for the three months ended September 30, 2022 when compared with the three months ended September 30, 2021 is primarily due to higher tax related to the geographic distribution of income partially offset by lower U.S.

tax on foreign income.

NOTE D – EARNINGS PER SHARE

During the nine months ended September 30, 2022, the Company recognized income tax expense of $ 52.6 million on income of $ 260.8 million, an effective tax rate of 20.2 %, as compared to income tax expense of $ 36.0 million on income of $ 195.5 million, an effective tax rate of 18.4 %, for the nine months ended September 30, 2021.

The higher effective tax rate for the nine months ended September 30, 2022 when compared with the nine months ended September 30, 2021 is primarily due to higher tax related to the geographic distribution of income and lower favorable discrete benefits partially offset by lower U.S.

tax on foreign income in the current year period.

As of September 30, 2022, the Company determined that it was appropriate to retain its valuation allowance on its German interest expense deferred tax asset.

However, it is reasonably possible that, in the near term, continuing improvement in operating performance and other positive evidence could change the Company’s assessment of the realizability of the German interest expense deferred tax asset resulting in the reversal of all, or part of, the related valuation allowance.

NOTE D – ACQUISITIONS

Total cash consideration was approximately $ 6 million.

On July 29, 2022, the Company acquired a 100% ownership interest in ProAll International Mfg.

and ProAll UK Limited and related assets (“ProAll”), a manufacturer of volumetric mixers based in Canada, to expand the Company’s concrete product offering.

Total consideration, including estimated contingent consideration from earnout provisions, was approximately $ 39 million.

These transactions were recorded as business combinations using the acquisition method which requires measurement of identifiable assets acquired and liabilities assumed at their estimated fair values as of the acquisition date.

Goodwill was calculated as the excess of the aggregate of the fair value of the consideration transferred over the fair value of the net assets recognized.

The results of operations associated with these businesses are consolidated within the MP segment in the Condensed Consolidated Financial Statements from the respective dates of acquisition.

See Note H – “Goodwill and Intangible Assets” for additional information regarding goodwill recognized as a result of these acquisitions.

NOTE E – EARNINGS PER SHARE

(in millions, except per share data) Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2022 2021 2022 2021

23 unchanged sentences

Non-vested restricted stock awards and restricted stock units (“Restricted Stock Awards”) granted by the Company are treated as potential common shares outstanding in computing diluted earnings per share using the treasury stock method.

Weighted average Restricted Stock Awards of approximately 0.9 million and 0.1 million were outstanding during the three months ended June 30, 2022 and 2021, respectively, but were not included in the computation of diluted shares as the effect would be anti-dilutive or performance targets were not expected to be achieved for awards contingent upon performance.

Weighted average Restricted Stock Awards of approximately 0.6 million and 0.1 million were outstanding during the six months ended June 30, 2022 and 2021, respectively, but were not included in the computation of diluted shares as the effect would be anti-dilutive or performance targets were not expected to be achieved for awards contingent upon performance.

NOTE E – INVENTORIES

Weighted average Restricted Stock Awards of approximately 0.5 million and 0.1 million were outstanding during the three months ended September 30, 2022 and 2021, respectively, but were not included in the computation of diluted shares as the effect would be anti-dilutive or performance targets were not expected to be achieved for awards contingent upon performance.

Weighted average Restricted Stock Awards of approximately 0.6 million and 0.1 million were outstanding during the nine months ended September 30, 2022 and 2021, respectively, but were not included in the computation of diluted shares as the effect would be anti-dilutive or performance targets were not expected to be achieved for awards contingent upon performance.

NOTE F – INVENTORIES

Inventories consist of the following (in millions):

September 30,

2022 December 31,

4 unchanged sentences

Inventories $ 981.2 $ 813.5

Work-in-process inventory includes approximately $ 63 million and $ 10 million of substantially completed inventory awaiting installation of final components at June 30, 2022 and December 31, 2021, respectively.

Reserves for lower of cost or net realizable value and excess and obsolete inventory were $ 57.5 million and $ 57.8 million at June 30, 2022 and December 31, 2021, respectively.

NOTE F – PROPERTY, PLANT AND EQUIPMENT

Work-in-process inventory includes approximately $ 63 million and $ 10 million of substantially completed inventory awaiting installation of final components at September 30, 2022 and December 31, 2021, respectively.

Reserves for lower of cost or net realizable value and excess and obsolete inventory were $ 55.6 million and $ 57.8 million at September 30, 2022 and December 31, 2021, respectively.

NOTE G – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment – net consist of the following (in millions):

September 30,

2022 December 31,

7 unchanged sentences

Property, plant and equipment – net $ 450.4 $ 429.6

NOTE G – GOODWILL AND INTANGIBLE ASSETS

NOTE H – GOODWILL AND INTANGIBLE ASSETS

An analysis of changes in the Company’s goodwill by business segment is as follows (in millions):

6 unchanged sentences

Foreign exchange effect and other ( 25.7 ) ( 3.2 ) ( 28.9 )

Balance at June 30, 2022, gross

Balance at September 30, 2022, gross

198.4 136.5 334.9

Accumulated impairment ( 23.2 ) ( 38.6 ) ( 61.8 )

Balance at June 30, 2022, net

Balance at September 30, 2022, net

$ 175.2 $ 97.9 $ 273.1

In connection with the Steelweld acquisition, the Company recognized goodwill of $ 3.0 million during the period.

The goodwill was assigned to the MP reporting unit and attributable primarily to the assembled workforce and expected synergies from the business combination.

The goodwill is not expected to be deductible for income tax purposes.

See Note A – “Basis of Presentation” for additional information regarding the Steelweld acquisition.

During the nine months ended September 30, 2022, the Company recognized goodwill of $ 3.5 million in connection with the Steelweld acquisition and $ 18.4 million in connection with the ProAll acquisition.

The goodwill associated with these transactions was attributable primarily to the assembled workforce and expected synergies from the business combinations.

The goodwill was assigned to the MP segment and is not expected to be deductible for income tax purposes.

See Note D – “Acquisitions” for additional information regarding the acquisitions.

Intangible assets, net were comprised of the following (in millions):

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Weighted Average Life

8 unchanged sentences

$ 75.8 $ ( 58.3 ) $ 17.5 $ 72.4 $ ( 59.0 ) $ 13.4

In connection with the Steelweld acquisition, the Company recognized customer relationships of $ 0.6 million with an estimated useful life of three years during the period.

See Note A – “Basis of Presentation” for additional information regarding the Steelweld acquisition.

During the nine months ended September 30, 2022, the Company recognized customer relationships of $ 0.6 million with an estimated useful life of three years in connection with the Steelweld acquisition and customer relationships of $ 3.2 million with an estimate useful life of nine years and trademarks of $ 3.7 million with an estimated useful life of ten years in connection with the ProAll acquisition.

See Note D – “Acquisitions” for additional information regarding the acquisitions.

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2022 2021 2022 2021

1 unchanged sentence

Estimated aggregate intangible asset amortization expense for each of the next five years is as follows (in millions):

NOTE H – DERIVATIVE FINANCIAL INSTRUMENTS

NOTE I – DERIVATIVE FINANCIAL INSTRUMENTS

The Company operates internationally, with manufacturing and sales facilities in various locations around the world.

7 unchanged sentences

Commodity Swaps

Derivatives designated as cash flow hedging instruments include commodity swaps with outstanding notional value of $ 15.6 million and $ 22.5 million at June 30, 2022 and December 31, 2021, respectively.

Commodity swaps outstanding at June 30, 2022 mature on or before August 31, 2023.

Derivatives designated as cash flow hedging instruments include commodity swaps with outstanding notional value of $ 18.6 million and $ 22.5 million at September 30, 2022 and December 31, 2021, respectively.

Commodity swaps outstanding at September 30, 2022 mature on or before August 31, 2024.

The Company uses commodity swaps to mitigate price risk for hot rolled coil steel.

3 unchanged sentences

Cross Currency Swaps

Derivatives designated as net investment hedging instruments include cross currency swaps with outstanding notional value of $ 62.9 million and $ 68.2 million at June 30, 2022 and December 31, 2021, respectively.

Derivatives designated as net investment hedging instruments include cross currency swaps with outstanding notional value of $ 29.4 million and $ 68.2 million at September 30, 2022 and December 31, 2021, respectively.

The Company uses these cross currency swaps to mitigate its exposure to changes in foreign currency exchange rates related to a net investment in a Euro-denominated functional currency subsidiary.

6 unchanged sentences

Fair values of these contracts are derived using quoted forward foreign exchange prices to interpolate values of outstanding trades at the reporting date based on their maturities.

Foreign exchange contracts outstanding at June 30, 2022 mature during the third quarter of 2022.

The Company had $ 0.3 million and $ 19.4 million notional value of foreign exchange contracts outstanding that were designated as cash flow hedging instruments at June 30, 2022 and December 31, 2021, respectively.

Foreign exchange contracts outstanding at September 30, 2022 mature on or before July 2023.

The Company had $ 8.6 million and $ 19.4 million notional value of foreign exchange contracts outstanding that were designated as cash flow hedging instruments at September 30, 2022 and December 31, 2021, respectively.

For effective hedging instruments, changes in the fair value of foreign exchange contracts are deferred in AOCI until the underlying hedged transactions settle.

Gains or losses on foreign exchange contracts are reclassified to COGS in the Condensed Consolidated Statement of Comprehensive Income (Loss).

The Company had $ 204.1 million and $ 139.7 million notional value of foreign exchange contracts outstanding that were not designated as cash flow hedging instruments at June 30, 2022 and December 31, 2021, respectively.

The Company had $ 241.6 million and $ 139.7 million notional value of foreign exchange contracts outstanding that were not designated as cash flow hedging instruments at September 30, 2022 and December 31, 2021, respectively.

The majority of gains and losses recognized from foreign exchange contracts not designated as hedging instruments are offset by changes in the underlying exposures the contracts are intended to mitigate, resulting in no material net impact on earnings.

4 unchanged sentences

Fair value of interest rate caps were based on the present value of future cash payments and receipts.

Changes in the fair value of interest rate were deferred in AOCI.

Changes in the fair value of interest rate caps were deferred in AOCI.

Gains or losses on interest rate caps were reclassified to Interest expense in the Condensed Consolidated Statement of Comprehensive Income (Loss) when the underlying hedged transactions occur.

The following table provides the location and fair value amounts of derivative instruments designated and not designated as hedging instruments that are reported in the Condensed Consolidated Balance Sheet (in millions):

September 30,

2022 December 31,

9 unchanged sentences

Cross currency swaps - net investment hedge Other non-current liabilities — — ( 2.4 ) —

Commodity swaps Other non-current liabilities ( 0.5 ) — — —

Net derivative asset (liability) $ ( 1.9 ) $ 2.2 $ 0.2 $ 0.7

3 unchanged sentences

Instrument Three Months Ended

June 30, 2022 Six Months Ended

June 30, 2022 Income Statement Account Three Months Ended

June 30, 2022 Six Months Ended

June 30, 2022

September 30, 2022 Nine Months Ended

September 30, 2022 Income Statement Account Three Months Ended

September 30, 2022 Nine Months Ended

September 30, 2022

Foreign exchange contracts $ ( 0.2 ) $ ( 0.2 ) Cost of goods sold $ — $ 0.1

4 unchanged sentences

Instrument Three Months Ended

June 30, 2021 Six Months Ended

June 30, 2021 Income Statement Account Three Months Ended

June 30, 2021 Six Months Ended

June 30, 2021

September 30, 2021 Nine Months Ended

September 30, 2021 Income Statement Account Three Months Ended

September 30, 2021 Nine Months Ended

September 30, 2021

Foreign exchange contracts $ — $ — Cost of goods sold $ — $ 0.1

7 unchanged sentences

Three Months Ended

June 30, 2022 Six Months Ended

June 30, 2022 Three Months Ended

June 30, 2022 Six Months Ended

June 30, 2022

September 30, 2022 Nine Months Ended

September 30, 2022 Three Months Ended

September 30, 2022 Nine Months Ended

September 30, 2022

Income Statement Accounts in which effects of cash flow hedges are recorded $ ( 883.4 ) $ ( 2,564.3 ) $ ( 13.5 ) $ ( 35.8 )

8 unchanged sentences

Three Months Ended

June 30, 2021 Six Months Ended June 30, 2021 Three Months Ended

June 30, 2021 Six Months Ended

June 30, 2021

September 30, 2021 Nine Months Ended September 30, 2021 Three Months Ended

September 30, 2021 Nine Months Ended

September 30, 2021

Income Statement Accounts in which effects of cash flow hedges are recorded $ ( 815.3 ) $ ( 2,311.2 ) $ ( 12.3 ) $ ( 40.6 )

10 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Instrument Income Statement Account 2022 2021 2022 2021

7 unchanged sentences

Management continues to monitor counterparty risk and believes the risk of incurring losses on derivative contracts related to credit risk is unlikely and any losses would be immaterial.

See Note L - “Stockholders’ Equity” for unrealized net gains (losses), net of tax, included in AOCI.

Within unrealized net gains (losses) included in AOCI as of June 30, 2022, it is estimated that approximately $ 1 million of gains are expected to be reclassified into earnings in the next twelve months.

NOTE I – LONG-TERM OBLIGATIONS

See Note M - “Stockholders’ Equity” for unrealized net gains (losses), net of tax, included in AOCI.

Within unrealized net gains (losses) included in AOCI as of September 30, 2022, it is estimated that approximately $ 2 million of losses are expected to be reclassified into earnings in the next twelve months.

NOTE J – LONG-TERM OBLIGATIONS

Credit Agreement

On January 31, 2017, the Company entered into a credit agreement with the lenders and issuing banks party thereto and Credit Suisse AG, Cayman Islands Branch (“CSAG”), as administrative agent and collateral agent, which was subsequently amended to include (i) a $ 600 million revolving line of credit (the “Revolver”) and (ii) senior secured term loans totaling $ 600 million with a maturity date of January 31, 2024 (the “Term Loans”).

On January 31, 2017, the Company entered into a credit agreement with the lenders and issuing banks party thereto and Credit Suisse AG, Cayman Islands Branch (“CSAG”), as administrative agent and collateral agent, to provide the Company with a multi-currency revolving line of credit and senior secured term loans.

This was subsequently amended to include (i) a $ 600 million revolving line of credit (the “Revolver”) and (ii) senior secured term loans totaling $ 600 million with a maturity date of January 31, 2024 (the “Term Loans”).

On April 1, 2021, the Company entered into an amendment and restatement of the credit agreement (as amended and restated, the “Credit Agreement”) which included the following principal changes to the original credit agreement:

11 unchanged sentences

During the second quarter of 2022 and 2021, the Company prepaid $ 23.0 million and $ 83.0 million, respectively, of the amount outstanding on the Original Term Loan prior to its maturity date to reduce the Company’s outstanding debt.

During the three months ended June 30, 2022 and 2021, the Company recorded a loss on early extinguishment of debt related to prepayment of $ 0.1 million and $ 0.7 million, respectively, for accelerated amortization of debt acquisition costs and original issue discount.

During the second quarter of 2022 and 2021, the Company recorded a loss on early extinguishment of debt related to prepayment of $ 0.1 million and $ 0.7 million, respectively, for accelerated amortization of debt acquisition costs and original issue discount.

Unlimited incremental commitments may be extended at the option of the existing or new lenders and can be in the form of revolving credit commitments, term loan commitments, or a combination of both, with incremental amounts in excess of $ 300 million as long as the Company satisfies the maximum permitted level of senior secured leverage as defined in the Credit Agreement.

9 unchanged sentences

The Credit Agreement also contains customary default provisions.

The Company was in compliance with all covenants contained in the Credit Agreement as of June 30, 2022.

As of June 30, 2022 and December 31, 2021, the Company had $ 54.9 million and $ 77.8 million, net of discount, respectively, in Term Loans outstanding under the Credit Agreement.

The weighted average interest rate on the Term Loans at June 30, 2022 and December 31, 2021 was 2.86 % and 2.75 %, respectively.

The Company had $ 175.0 million of revolving credit amounts outstanding as of June 30, 2022 and no revolving credit amounts outstanding as of December 31, 2021.

The weighted average interest rate on the revolving credit amounts at June 30, 2022 was 2.80 %.

The Company was in compliance with all covenants contained in the Credit Agreement as of September 30, 2022.

As of September 30, 2022 and December 31, 2021, the Company had $ 54.9 million and $ 77.8 million, net of discount, respectively, in Term Loans outstanding under the Credit Agreement.

The weighted average interest rate on the Term Loans at September 30, 2022 and December 31, 2021 was 4.67 % and 2.75 %, respectively.

The Company had $ 173.7 million of revolving credit amounts outstanding as of September 30, 2022 and no revolving credit amounts outstanding as of December 31, 2021.

The weighted average interest rate on the revolving credit amounts at September 30, 2022 was 4.01 %.

The Company obtains letters of credit that generally serve as collateral for certain liabilities included in the Condensed Consolidated Balance Sheet and guaranteeing the Company’s performance under contracts.

7 unchanged sentences

Letters of credit outstanding (in millions):

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

$400 Million Facility $ — $ —

17 unchanged sentences

Fair Value of Debt

The Company estimates the fair values of its debt set forth below as of June 30, 2022, as follows (in millions, except for quotes):

The Company estimates the fair values of its debt set forth below as of September 30, 2022, as follows (in millions, except for quotes):

Book Value Quote Fair Value

5 unchanged sentences

See Note A – “Basis of Presentation” for an explanation of ASC 820 hierarchy.

NOTE J – RETIREMENT PLANS AND OTHER BENEFITS

NOTE K – RETIREMENT PLANS AND OTHER BENEFITS

The Company maintains defined benefit plans in France, Germany, India, Switzerland and the United Kingdom for some of its subsidiaries, as well as a nonqualified Supplemental Executive Retirement Plan in the U.S.

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2022 2021 2022 2021

17 unchanged sentences

The Service cost component is included in the same line item or items as other compensation costs arising from services rendered by pertinent employees during the period.

NOTE K – LITIGATION AND CONTINGENCIES

NOTE L – LITIGATION AND CONTINGENCIES

The Company is involved in various legal proceedings, including product liability, general liability, workers’ compensation liability, employment, commercial and intellectual property litigation, which have arisen in the normal course of operations.

20 unchanged sentences

however, it cannot be reasonably estimated due to limited availability of the unique facts and circumstances of each arrangement, such as whether changes have been made to the structure of the contractual obligation between the funder and customer.

For credit guarantees outstanding as of June 30, 2022 and December 31, 2021, the maximum exposure determined was $ 124.6 million and $ 143.5 million, respectively.

For credit guarantees outstanding as of September 30, 2022 and December 31, 2021, the maximum exposure determined was $ 120.7 million and $ 143.5 million, respectively.

Terms of these guarantees coincide with the financing arranged by the customer and generally do not exceed five years .

The allowance for credit losses on credit guarantees was $ 6.8 million and $ 6.3 million at June 30, 2022 and December 31, 2021, respectively.

The allowance for credit losses on credit guarantees was $ 7.3 million and $ 6.3 million at September 30, 2022 and December 31, 2021, respectively.

There can be no assurance that historical experience in used equipment markets will be indicative of future results.

The Company’s ability to recover losses experienced from its guarantees may be affected by economic conditions in used equipment markets at the time of loss.

NOTE L – STOCKHOLDERS’ EQUITY

NOTE M – STOCKHOLDERS’ EQUITY

Changes in Accumulated Other Comprehensive Income (Loss)

The table below presents changes in AOCI by component for the three and six months ended June 30, 2022 and 2021.

The table below presents changes in AOCI by component for the three and nine months ended September 30, 2022 and 2021.

All amounts are net of tax (in millions).

Three Months Ended

June 30, 2022 Three Months Ended

June 30, 2021

September 30, 2022 Three Months Ended

September 30, 2021

CTA Derivative Hedging Adj.

13 unchanged sentences

$ ( 359.7 ) $ ( 1.0 ) $ ( 3.9 ) $ ( 36.7 ) $ ( 401.3 ) $ ( 183.7 ) $ 9.8 $ 0.4 $ ( 55.8 ) $ ( 229.3 )

Six Months Ended

June 30, 2022

Six Months Ended

June 30, 2021

Nine Months Ended

September 30, 2022

Nine Months Ended

September 30, 2021

CTA Derivative Hedging Adj.

13 unchanged sentences

Stock-Based Compensation

During the six months ended June 30, 2022, the Company awarded 0.7 million shares of Restricted Stock Awards to its employees with a weighted average grant date fair value of $ 40.45 per share.

During the nine months ended September 30, 2022, the Company awarded 0.7 million shares of Restricted Stock Awards to its employees with a weighted average grant date fair value of $ 40.33 per share.

Approximately 58 % of these awards are time-based and vest ratably on each of the first three anniversary dates of the grants.

13 unchanged sentences

The table below presents shares repurchased, inclusive of transactions executed but not settled, by the Company under this program.

Six Months Ended

June 30 Total Number of

Nine Months Ended

September 30 Total Number of

Shares Repurchased Amount of Shares Repurchased

2 unchanged sentences

The table below presents dividends declared by Terex’s Board of Directors and paid to the Company’s shareholders:

Year First Quarter Second Quarter

Year First Quarter Second Quarter Third Quarter

2022 $ 0.13 $ 0.13 $ 0.13

2021 $ 0.12 $ 0.12 $ 0.12

In July 2022, Terex’s Board of Directors declared a dividend of $ 0.13 per share, which will be paid on September 19, 2022 to the Company’s shareholders of record as of August 12, 2022.

In October 2022, Terex’s Board of Directors declared a dividend of $ 0.13 per share, which will be paid on December 19, 2022 to the Company’s shareholders of record as of November 10, 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements