22 unchanged sentences
OTHER INFORMATION
+Added: DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.
+Added: Not applicable.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
17 unchanged sentences
The information required by Item 14 is incorporated by reference from the definitive Terex Corporation Proxy Statement to be filed with the SEC within 120 days after the year covered by this Annual Report on Form 10-K.
−Removed: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
+Added: EXHIBIT AND FINANCIAL STATEMENT SCHEDULES
(a) (1) and (2) Financial Statements and Financial Statement Schedules.
19 unchanged sentences
1-10702, dated October 14, 2008 and filed with the Commission on October 17, 2008).
−Removed: 10.5 Terex Corporation Deferred Compensation Plan (incorporated by reference to Exhibit 10.2 of the Form 8-K Current Report, Commission File No.
−Removed: 1-10702, dated May 9, 2013 and filed with the Commission on May, 14, 2013).
+Added: 10.5 Terex Corporation Deferred Compensation Plan dated as of March 3, 2022 (incorporated by reference to Exhibit 10.1 of the Form 8-K Current Report, Commission File No.
+Added: 1-10702, dated May 19, 2022 and filed with the Commission May 23, 2022).
10.6 Employment Letter from Terex Corporation signed by John Garrison on October 15, 2015 (incorporated by reference to Exhibit 10.1 of the Form 8-K Current Report, Commission File No.
1-10702, dated October 15, 2015 and filed with the Commission on October 19, 2015).
−Removed: 10.7 Employment Letter from Terex Corporation signed by John Sheehan on February 5, 2017 (Incorporated by reference to Exhibit 10.21 of the Form 10-K for the year ended December 31, 2017).
+Added: 10.7 Employment Letter from Terex Corporation signed by Julie A.
+Added: Beck on February 9, 2022 (incorporated by reference to Exhibit 10.16 of the Form 10-K for the year ended December 31, 2021).
10.8 Form of Restricted Stock Agreement (time based granted 2019) under the Terex Corporation 2018 Omnibus Incentive Plan between Terex Corporation and participants of the 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.2 of the Form 10-Q for the quarter ended March 31, 2019 of Terex Corporation, Commission File No.
10.9 Form of Restricted Stock Agreement (performance based granted 2019) under the Terex Corporation 2018 Omnibus Incentive Plan between Terex Corporation and participants of the 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.3 of the Form 10-Q for the quarter ended March 31, 2019 of Terex Corporation, Commission File No.
+Added: 10.10 Terex Corporation Amended and Restated 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 of the Form 8-K Current Report, Commission File No.
+Added: 1-10702, dated May 6, 2021 and filed with the Commission May 11, 2021).
10.11 Form of Change in Control and Severance Agreement between Terex Corporation and certain executive officers (incorporated by reference to Exhibit 10.4 of the Form 10-Q for the quarter ended March 31, 2019 of Terex Corporation, Commission File No.
6 unchanged sentences
1-10702, dated January 31, 2017 and filed with the Commission February 2, 2017).
−Removed: 10.15 Terex Corporation Amended and Restated 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 of the Form 8-K Current Report, Commission File No.
−Removed: 1-10702, dated May 6, 2021 and filed with the Commission May 11, 2021).
−Removed: 10.16 Employment Letter from Terex Corporation signed by Julie A.
−Removed: Beck on February 9, 2022 .
+Added: 10.16 Amendment dated as of December 29, 2022, relating to the Guarantee and Collateral Agreement dated as of January 31, 2017, among Terex Corporation, certain of its subsidiaries, the Lenders and Issuing Banks named therein and Credit Suisse AG, Cayman Islands Branch, as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.1 of the Form 8-K Current Report, Commission File No.
+Added: 1-10702, dated December 29, 2022 and filed with the Commission December 30, 2022).
21.1 Subsidiaries of Terex Corporation.
32 unchanged sentences
/s/ Stephen A.
−Removed: Johnston Chief Accounting Officer February 11, 2022
+Added: Johnston Vice President, Chief Accounting Officer and Controller February 10, 2023
Johnston (Principal Accounting Officer)
23 unchanged sentences
IN THE PERIOD ENDED DECEMBER 31, 2022
−Removed: Report s of Independent Registered Public Accounting Firm s
+Added: Reports of Independent Registered Public Accounting Firms
Consolidated Statement of Income (Loss)
11 unchanged sentences
Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
−Removed: We have audited the accompanying consolidated balance sheet of Terex Corporation and subsidiaries (the Company) as of December 31, 2021, the related consolidated statement of income (loss), comprehensive income (loss), changes in stockholders’ equity, and cash flows for the year then ended, and the related notes and financial statement Schedule II – Valuation and Qualifying Accounts and Reserves (collectively, the consolidated financial statements).
+Added: We have audited the accompanying consolidated balance sheets of Terex Corporation and subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of income (loss), comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2022, and the related notes and financial statement Schedule II – Valuation and Qualifying Accounts and Reserves (collectively, the consolidated financial statements).
We also have audited the Company’s internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
−Removed: In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and the results of its operations and its cash flows for the year then ended, in conformity with U.S.
+Added: In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2022, in conformity with U.S.
generally accepted accounting principles.
7 unchanged sentences
Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
−Removed: Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
−Removed: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+Added: Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.
−Removed: Our audit also included performing such other procedures as we considered necessary in the circumstances.
+Added: Our audits also included performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provide a reasonable basis for our opinions.
10 unchanged sentences
The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Identification of uncertain tax positions and the recoverability of deferred tax assets
−Removed: As described in Note C – “Income Taxes” to the consolidated financial statements, the Company reported a liability of $2.6 million related to unrecognized tax benefits and net deferred tax assets of $133.0 million as of December 31, 2021.
−Removed: The Company uses judgments and estimates to determine the uncertain tax positions and deferred tax asset valuation allowances, particularly as a result of the Company’s worldwide operations.
−Removed: Where the Company has determined that its tax return filing position does not satisfy the more likely than not recognition threshold, it has recorded no tax benefits.
+Added: Recoverability of certain deferred tax assets
+Added: As described in Note C – “Income Taxes” to the consolidated financial statements, the Company reported net deferred tax assets of $127.9 million as of December 31, 2022.
The Company assesses the net realizable value of its deferred tax assets based on available evidence, including historical information that is supplemented by currently available information about future tax years.
−Removed: We identified the identification of uncertain tax positions and the recoverability of deferred tax assets as a critical audit matter.
−Removed: A high degree of auditor judgment, including the involvement of tax and valuation professionals with specialized skills and knowledge, was required in evaluating (i) the identification of uncertain tax positions, particularly given the complexities in worldwide tax laws and (ii) future taxable income and statutory limitations used in determining deferred tax asset valuation allowances.
+Added: We identified the evaluation of the recoverability of certain deferred tax assets as a critical audit matter.
+Added: A high degree of auditor judgment, including the involvement of tax professionals with specialized skills and knowledge, was required to evaluate the application of relevant tax law and the estimated future taxable income used in assessing the recoverability of certain deferred tax assets.
The following are the primary procedures we performed to address this critical audit matter.
−Removed: We evaluated the design and tested the operating effectiveness of certain internal controls related to income taxes, including controls related to the identification of uncertain tax positions and the recoverability of deferred tax assets.
−Removed: For the identification of uncertain tax positions, tax and valuation professionals with specialized skills and knowledge assisted in evaluating management’s identification of uncertain tax positions, including interpretation of relevant tax law and consideration of ongoing and completed examinations by tax authorities, and assessing certain international intercompany arrangements for consistency with relevant regulations and generally accepted practices.
−Removed: For the assessment of the recoverability of deferred tax assets, we evaluated the Company’s estimated future taxable income primarily by comparing estimated amounts to historical amounts and trends and by considering the length of the period over which the net deferred tax assets are expected to be used.
−Removed: Tax professionals with specialized skills and knowledge assisted in evaluating the recoverability of deferred tax assets, including statutory limitations on the use of those assets and assessing potential adjustments to future taxable income based on known events and relevant enacted tax regulations.
+Added: We evaluated the design and tested the operating effectiveness of certain internal controls related to the recoverability of deferred tax assets.
+Added: This included controls related to management’s analysis of relevant tax law and the estimated future taxable income used in assessing recoverability.
+Added: We evaluated the Company’s estimated future taxable income in certain jurisdictions, primarily by comparing estimated amounts to historical actual amounts, by considering historical trends in taxable income, and by evaluating available information about future tax years, including relevant economic trends and information.
+Added: We involved tax professionals with specialized skills and knowledge, who assisted in evaluating the recoverability of certain deferred tax assets by assessing the application of relevant tax law and the extent to which the deferred tax assets are subject to limitation on usage or expiry.
We have served as the Company’s auditor since 2021.
5 unchanged sentences
Opinion on the Financial Statements
−Removed: We have audited the consolidated balance sheet of Terex Corporation and its subsidiaries (the “Company”) as of December 31, 2020, and the related consolidated statements of income (loss), of comprehensive income (loss), of changes in stockholders’ equity and of cash flows for each of the two years in the period ended December 31, 2020, including the related notes and financial statement schedule listed in the accompanying index for each of the two years in the period ended December 31, 2020 (collectively referred to as the “consolidated financial statements”).
−Removed: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2020 in conformity with accounting principles generally accepted in the United States of America.
+Added: We have audited the consolidated statements of income (loss), of comprehensive income (loss), of changes in stockholders’ equity and of cash flows of Terex Corporation and its subsidiaries (the “Company”) for the year ended December 31, 2020, including the related notes and financial statement schedule listed in the accompanying index for the year ended December 31, 2020 (collectively referred to as the “consolidated financial statements”).
+Added: In our opinion, the consolidated financial statements present fairly, in all material respects, the results of operations and cash flows of the Company for the year ended December 31, 2020 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company's management.
−Removed: Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.
+Added: Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.
We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
−Removed: We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB.
+Added: We conducted our audit of these consolidated financial statements in accordance with the standards of the PCAOB.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
−Removed: Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
−Removed: Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
−Removed: We believe that our audits provide a reasonable basis for our opinion.
+Added: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+Added: We believe that our audit provides a reasonable basis for our opinion.
/s/PricewaterhouseCoopers LLP
53 unchanged sentences
Amortization of actuarial (gain) loss, net of provision for (benefit from) taxes of $( 0.2 ), $( 0.3 ) and $( 0.4 ) for the years ended December 31, 2022, 2021 and 2020, respectively
−Removed: Divestiture of business, net of provision for (benefit from) taxes of $ 0.0 , $ 0.0 and $( 5.3 ) for the years ended December 31, 2021, 2020 and 2019, respectively
Foreign exchange and other effects, net of (provision for) benefit from taxes of $( 0.1 ), $ 0.1 and $( 0.6 ) for the years ended December 31, 2022, 2021 and 2020, respectively
24 unchanged sentences
Accrued compensation and benefits 103.0 108.5
−Removed: Accrued warranties and product liability 39.2 48.3
Other current liabilities 269.1 258.1
24 unchanged sentences
Income (Loss) Common
−Removed: Treasury Non-controlling
−Removed: Interest Total
+Added: Treasury Total
Balance at December 31, 2019
+Added: 70.4 $ 0.8 $ 824.4 $ 771.4 $ ( 257.5 ) $ ( 406.8 ) $ 932.3
Net income (loss) — — — ( 10.6 ) — — ( 10.6 )
1 unchanged sentence
— — — — 49.1 — 49.1
−Removed: Issuance of common stock 0.9 — 27.8 — — — — 27.8
+Added: Issuance of common stock related to compensation 0.7 0.1 29.0 — — — 29.1
Compensation under stock-based plans – net
2 unchanged sentences
Acquisition of treasury stock ( 2.6 ) — — — — ( 56.1 ) ( 56.1 )
−Removed: Divestiture — — — — — — ( 0.5 ) ( 0.5 )
+Added: Other — — — ( 1.9 ) — — ( 1.9 )
Balance at December 31, 2020
+Added: 68.6 0.9 837.9 750.3 ( 208.4 ) ( 459.2 ) 921.5
Net income (loss) — — — 220.9 — — 220.9
1 unchanged sentence
— — — — ( 20.1 ) — ( 20.1 )
−Removed: Issuance of common stock 0.7 0.1 29.0 — — — — 29.1
+Added: Issuance of common stock related to compensation 0.6 — 12.2 — — — 12.2
Compensation under stock-based plans – net
4 unchanged sentences
Balance at December 31, 2021
+Added: 69.2 0.9 860.0 936.9 ( 228.5 ) ( 459.7 ) 1,109.6
Net income (loss) — — — 300.0 — — 300.0
1 unchanged sentence
— — — — ( 113.1 ) — ( 113.1 )
−Removed: Issuance of common stock 0.6 — 12.2 — — — — 12.2
+Added: Issuance of common stock related to compensation 0.6 — 18.7 — — — 18.7
Compensation under stock-based plans – net
4 unchanged sentences
Balance at December 31, 2022
+Added: 66.8 $ 0.9 $ 881.6 $ 1,200.6 $ ( 341.6 ) $ ( 560.3 ) $ 1,181.2
The accompanying notes are an integral part of these consolidated financial statements.
9 unchanged sentences
Depreciation and amortization 47.2 50.2 49.7
−Removed: (Gain) loss on disposition of discontinued operations ( 3.4 ) 19.2 ( 0.1 )
−Removed: Deferred taxes 1.2 5.6 ( 17.6 )
−Removed: Impairments 6.3 5.5 83.6
−Removed: (Gain) loss on sale of assets ( 7.4 ) ( 0.4 ) ( 9.8 )
−Removed: Loss on early extinguishment of debt 29.4 — —
Stock-based compensation expense 30.3 33.1 23.8
10 unchanged sentences
Capital expenditures ( 109.6 ) ( 59.7 ) ( 64.5 )
−Removed: Proceeds from sale of capital assets 1.9 2.7 4.3
Acquisitions, net of cash acquired, and investments ( 50.1 ) ( 42.7 ) —
−Removed: Proceeds (payments) from disposition of investments ( 1.7 ) 7.5 30.7
Proceeds from disposition of discontinued operations — — 15.8
+Added: Other investing activities, net 5.6 0.2 10.2
Net cash provided by (used in) investing activities ( 154.1 ) ( 102.2 ) ( 38.5 )
2 unchanged sentences
Proceeds from issuance of debt 320.9 600.1 170.0
−Removed: Payment of debt extinguishment costs ( 16.9 ) — —
Share repurchases ( 101.3 ) ( 3.0 ) ( 56.0 )
7 unchanged sentences
$ 304.1 $ 266.9 $ 670.1
−Removed: (1) Cash and Cash Equivalents includes Cash and Cash Equivalents-Held for Sale of $ 5.1 and $ 5.0 at December 31, 2020 and 2019, respectively.
+Added: (1) Cash and Cash Equivalents includes Cash and Cash Equivalents-Held for Sale of $ 5.1 at December 31, 2020.
The accompanying notes are an integral part of these consolidated financial statements.
7 unchanged sentences
Certain prior period amounts have been reclassified to conform with the 2022 presentation.
−Removed: As further described in Note D – “Acquisitions and Discontinued Operations”, on July 31, 2019, the Company completed the disposition of its Demag ® mobile cranes business (“Demag”) to Tadano Ltd.
−Removed: and certain of its subsidiaries (“Tadano”).
−Removed: During 2019, the Company also exited North American mobile crane product lines manufactured in its Oklahoma City facility.
−Removed: As a result, the Company reported these operations, formerly part of the Cranes segment, in discontinued operations in the Consolidated Statement of Income (Loss) for all periods presented.
−Removed: Residual assets and liabilities were recorded within Prepaid and other current assets, Other assets, Other current liabilities and Other non-current liabilities in the Consolidated Balance Sheet at December 31, 2020.
−Removed: See Note D – “Acquisitions and Discontinued Operations” for further information.
Use of Estimates.
60 unchanged sentences
Included in Selling, general & administrative expenses (“SG&A”) in the Consolidated Statement of Income (Loss) are $ 1.1 million, $ 6.3 million and $ 5.5 million of asset impairments for the years ended December 31, 2022, 2021 and 2020, respectively.
+Added: Assets Held for Sale.
+Added: The Company classifies its long-lived assets to be sold as held for sale in the period (i) it has approved and committed to a plan to sell the asset, (ii) the asset is available for immediate sale in its present condition, (iii) an active program to locate a buyer and other actions required to sell the asset have been initiated, (iv) the sale of the asset is probable, (v) the asset is being actively marketed for sale at a price that is reasonable in relation to its current fair value and (vi) it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.
+Added: The Company initially measures a long-lived asset that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell.
+Added: Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met.
+Added: Conversely, gains are not recognized on the sale of a long-lived asset until the date of sale.
+Added: Upon designation as an asset held for sale, the Company stops recording depreciation expense on the asset.
+Added: The Company assesses the fair value of a long-lived asset less any costs to sell at each reporting period and until the asset is no longer classified as held for sale.
Accounts Receivable and Allowance for Doubtful Accounts.
20 unchanged sentences
The allowance for credit losses on finance receivables was $ 7.4 million and $ 7.9 million at December 31, 2022 and 2021, respectively.
−Removed: In February 2021, the Company transferred finance receivables of $ 89.7 million to a U.S.
−Removed: regional bank, which qualified for sales treatment under ASC 860.
+Added: In February 2021, the Company transferred finance receivables of $ 89.7 million to a United States (“U.S.”) regional bank, which qualified for sales treatment under ASC 860.
The Company received $ 99.4 million of cash proceeds from the sale and recognized a net gain of $ 5.6 million.
6 unchanged sentences
(iv) allocation of the transaction price to the performance obligations and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.
−Removed: In the United States, the Company has the ability to enter into a security agreement and receive a security interest in the product by filing an appropriate Uniform Commercial Code (“UCC”) financing statement.
−Removed: However, a significant portion of the Company’s revenue is generated outside of the United States.
−Removed: In many countries outside of the United States, as a matter of statutory law, a seller retains title to a product until payment is made.
+Added: In the U.S., the Company has the ability to enter into a security agreement and receive a security interest in the product by filing an appropriate Uniform Commercial Code (“UCC”) financing statement.
+Added: However, a significant portion of the Company’s revenue is generated outside of the U.S.
+Added: In many countries outside of the U.S., as a matter of statutory law, a seller retains title to a product until payment is made.
The laws do not provide for a seller’s retention of a security interest in goods in the same manner as established in the UCC.
22 unchanged sentences
The Company determines if an arrangement contains a lease at contract inception.
−Removed: With the exception of short-term leases (leases with terms less than 12 months), all leases with contractual fixed costs are recorded on the balance sheet on the lease commencement date as a right-of-use (“ROU”) asset and a lease liability.
+Added: With the exception of short-term leases (leases with terms less than 12 months), all leases with contractual fixed costs are recorded on the balance sheet on the lease commencement date as a right-of-use asset and a lease liability.
Lease liabilities are initially measured at the present value of the minimum lease payments and subsequently increased to reflect the interest accrued and reduced by the lease payments affected.
−Removed: ROU assets are initially measured at the present value of the minimum lease payments adjusted for any prior lease payments, lease incentives and initial direct costs.
+Added: Right-of-use assets are initially measured at the present value of the minimum lease payments adjusted for any prior lease payments, lease incentives and initial direct costs.
The Company does not separate lease and non-lease components of a contract for any class of leases.
−Removed: Certain leases contain escalation, renewal and/or termination options that are factored into the ROU asset as appropriate.
+Added: Certain leases contain escalation, renewal and/or termination options that are factored into the right-of-use asset as appropriate.
Operating leases result in a straight-line rent expense over the life of the lease.
−Removed: For finance leases, ROU assets are amortized on a straight-line basis over the life of the lease and interest accretes to the lease liability which results in a higher interest expense at lease inception that declines over the life of the lease.
−Removed: Generally, variable lease costs are expensed as incurred and are not included in the determination of ROU assets or lease liabilities.
+Added: For finance leases, right-of-use assets are amortized on a straight-line basis over the life of the lease and interest accretes to the lease liability which results in a higher interest expense at lease inception that declines over the life of the lease.
+Added: Generally, variable lease costs are expensed as incurred and are not included in the determination of right-of-use assets or lease liabilities.
Short-term leases for real property, vehicles and industrial and office equipment are recognized in the income statement on a straight-line basis over the lease term.
1 unchanged sentence
Consideration is given to the Company’s recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating incremental borrowing rates.
−Removed: The Company adopted Accounting Standard Update (“ASU”) 2016-02, “Leases (Topic 842),” on January 1, 2019 under the alternative transition method permitted by ASU 2018-11, “Leases (Topic 842):
−Removed: Targeted Improvements”.
For detailed lease information see Note K – “Leases”.
The Company issues guarantees to financial institutions related to financing of equipment purchases by customers.
−Removed: The expectation of losses or non-performance is assessed based on consideration of historical customer assessments, current financial conditions, reasonable and supportable forecasts, equipment collateral value and other factors.
+Added: The expectation of losses or non-performance is evaluated based on consideration of historical customer assessments, current financial conditions, reasonable and supportable forecasts, equipment collateral value and other factors.
Reserves are recorded for expected loss over the contractual period of risk exposure.
31 unchanged sentences
ASC 715 requires balance sheet recognition of the overfunded or underfunded status of pension and post-retirement benefit plans.
−Removed: Under ASC 715, actuarial gains and losses and prior service costs or credits must be recognized in Accumulated other comprehensive income, net of tax effects, until they are amortized as a component of net periodic benefit cost.
+Added: Under ASC 715, actuarial gains and losses and prior service costs or credits must be recognized in Accumulated other comprehensive income (loss) (“AOCI”), net of tax effects, until they are amortized as a component of net periodic benefit cost.
See Note L – “Retirement Plans and Other Benefits.”
12 unchanged sentences
Income and expenses are translated at average exchange rates during the year.
−Removed: For operations whose functional currency is the local currency, translation adjustments are recorded in the Accumulated other comprehensive income component of Stockholders’ equity.
−Removed: Gains or losses resulting from foreign currency transactions are recorded in the accounts based on the underlying transaction.
+Added: For operations whose functional currency is the local currency, translation adjustments are recorded in the AOCI component of Stockholders’ equity.
+Added: Gains or losses resulting from foreign currency transactions are recorded in income statement accounts based on the underlying transaction.
Derivative financial instruments are recorded in the Consolidated Balance Sheet at their fair value as either assets or liabilities.
−Removed: Changes in the fair value of derivatives are recorded each period in earnings or Accumulated other comprehensive income, depending on whether a derivative is designated and effective as part of a hedge transaction and, if it is, the type of hedge transaction.
−Removed: Gains and losses on derivative instruments reported in Accumulated other comprehensive income are included in earnings in the periods in which earnings are affected by the hedged item.
+Added: Changes in the fair value of derivatives are recorded each period in earnings or AOCI, depending on whether a derivative is designated and effective as part of a hedge transaction and, if it is, the type of hedge transaction.
+Added: Gains and losses on derivative instruments reported in AOCI are included in earnings in the periods in which earnings are affected by the hedged item.
See Note I – “Derivative Financial Instruments.”
6 unchanged sentences
This method requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between financial statement carrying amounts and the tax bases of assets and liabilities.
+Added: The Company evaluates the net realizable value of its deferred tax assets each period to ensure that estimated future taxable income will be sufficient in character, amount and timing to result in the use of its deferred tax assets.
+Added: “Character” refers to the type (ordinary income versus capital gain) as well as the source (foreign vs.
+Added: domestic) of the income the Company generates.
+Added: “Timing” refers to the period in which future income is expected to be generated.
+Added: Timing is important because, in certain jurisdictions, net operating losses (“NOLs”) or other tax attributes expire if not used within an established statutory time frame.
+Added: The Company records a valuation allowance for each deferred tax asset for which realization is not assessed as more likely than not.
+Added: The Company must consider all objective evidence, both positive and negative, in evaluating the future realization of its deferred tax assets, including tax loss carry forwards.
+Added: Available evidence, including historical information is supplemented by currently obtainable information about future tax years.
+Added: Realization of deferred tax assets requires sufficient taxable income of the appropriate character.
+Added: Based on these evaluations, the Company has determined that it is more likely than not that expected future earnings will be sufficient to use most of its deferred tax assets.
+Added: To the extent estimates of future taxable income decrease or do not materialize, additional valuation allowances may be required.
+Added: The Company conducts business globally and files income tax returns in U.S.
+Added: Federal, state and foreign jurisdictions, as required.
+Added: The Company assesses uncertain tax positions for recognition, measurement and effective settlement.
+Added: Where the Company has determined that its tax return filing position does not satisfy the more likely than not recognition threshold of ASC 740, “Income Taxes,” it has recorded no tax benefits.
+Added: Where the Company had determined that its tax return filing positions are more likely than not to be sustained, it has measured and recorded the largest amount of tax benefit greater than 50% likely to be realized.
+Added: The Company evaluates each reporting period whether it is reasonably possible material changes to its uncertain tax position liability could occur in the next 12 months.
+Added: Changes may occur as a result of uncertain tax positions being considered effectively settled, re-measured, paid, acquired or divested, as a result of a change in tax law or judicial decision, or due to expiration of the relevant statute of limitations.
+Added: It is not possible to predict which uncertain tax positions, if any, may be challenged by tax authorities.
+Added: Timing and impact of income tax audits and their resolution is uncertain.
+Added: New facts, laws, pronouncements and judicial decisions can change assessments concerning technical merit and measurement.
+Added: The amounts of or periods in which changes to reserves for uncertain tax positions will occur is difficult to predict.
+Added: In January 2018, the FASB released guidance on the accounting for tax on Global Intangible Low-taxed Income (“GILTI”).
+Added: The guidance indicates that either accounting for deferred taxes related to GILTI or treating any taxes on GILTI as period costs are both acceptable accounting policy elections.
+Added: Terex elected to treat taxes on GILTI inclusions as period costs.
+Added: The Company does not provide for foreign income and withholding, U.S.
+Added: Federal, or state income taxes or tax benefits on the financial reporting basis over the tax basis of its investments in foreign subsidiaries to the extent such amounts are indefinitely reinvested to support operations and continued growth plans outside the U.S.
+Added: The Company reviews its plan to indefinitely reinvest on a quarterly basis.
+Added: In making its decision to indefinitely reinvest, the Company evaluates its plans of reinvestment, its ability to control repatriation and to mobilize funds without triggering basis differences, and the profitability of U.S.
+Added: operations and their cash requirements and the need, if any, to repatriate funds.
+Added: If the assessment of the Company with respect to earnings of non-U.S.
+Added: subsidiaries changes, deferred taxes for foreign income taxes and withholding, U.S.
+Added: Federal or state income taxes or tax benefits may have to be accrued.
+Added: The Company considers foreign earnings that have been taxed in the U.S.
+Added: or have qualified for the high-tax exception to taxation to not be indefinitely reinvested.
+Added: The Company has recorded foreign, federal and state tax expense with respect to earnings which have been subject to federal income tax and which are no longer indefinitely reinvested.
+Added: The Company plans to indefinitely reinvest all undistributed foreign earnings in excess of those previously taxed in the U.S.
+Added: The Company recognizes accrued interest and penalties, if any, related to income taxes as (Provision for) benefit from income taxes in its Consolidated Statement of Income (Loss).
See Note C – “Income Taxes”.
4 unchanged sentences
Fair Value Measurements.
−Removed: Assets and liabilities measured at fair value on a recurring basis under the provisions of ASC 820, “Fair Value Measurement and Disclosure” (“ASC 820”) include commodity swaps, interest rate caps, cross currency swaps and foreign exchange contracts, discussed in Note I – “Derivative Financial Instruments” and debt discussed in Note J – “Long-term Obligations”.
+Added: Assets and liabilities measured at fair value on a recurring basis under the provisions of 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.
7 unchanged sentences
The Company evaluates its hierarchy disclosures each quarter.
−Removed: Recently Issued Accounting Standards
−Removed: Accounting Standards Implemented in 2021
−Removed: In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which is intended to simplify various aspects related to accounting for income taxes.
−Removed: ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application of Topic 740.
−Removed: The Company adopted ASU 2019-12 on January 1, 2021.
−Removed: Adoption did not have a material effect on the Company’s consolidated financial statements.
Accounting Standards to be Implemented
−Removed: In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):
+Added: In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848):
Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying U.S.
−Removed: GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met to ease an entity’s financial reporting burden as the market transitions from LIBOR and other interbank offered rates to alternative reference rates.
−Removed: The FASB further issued ASU 2021-01 in January 2021 to clarify the scope of Topic 848.
+Added: GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met to ease an entity’s financial reporting burden as the market transitions from London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates.
+Added: Subsequently, the FASB issued ASU 2021-01 to clarify the scope of Topic 848 and ASU 2022-06 to defer the sunset date of Topic 848.
The guidance was effective upon issuance and may be applied through December 31, 2024.
1 unchanged sentence
NOTE B – BUSINESS SEGMENT INFORMATION
−Removed: Terex is a global manufacturer of aerial work platforms and materials processing machinery.
−Removed: The Company designs, builds and supports products used in construction, maintenance, manufacturing, energy, minerals and materials management applications.
−Removed: Terex products and solutions enable customers to reduce their environmental impact including electric and hybrid offerings that deliver quiet and emission-free performance, products that support renewable energy, and products that aid in the recovery of useful materials from various types of waste.
+Added: Terex is a global manufacturer of materials processing machinery and aerial work platforms.
+Added: The Company designs, builds and supports products used in construction, maintenance, manufacturing, energy, recycling, minerals and materials management applications.
+Added: Certain Terex products and solutions enable customers to reduce their impact on the environment including electric and hybrid offerings that deliver quiet and emission-free performance, products that support renewable energy, and products that aid in the recovery of useful materials from various types of waste.
The Company’s products are manufactured in North America, Europe, Australia and Asia and sold worldwide.
1 unchanged sentence
The Company identifies its operating segments according to how business activities are managed and evaluated, and has identified three operating segments:
−Removed: Aerials, Utilities and Materials Processing (“MP”).
+Added: 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”).
The Company operates in two reportable segments:
−Removed: (i) AWP and (ii) MP.
−Removed: AWP designs, manufactures, services and markets aerial work platform equipment, utility equipment and telehandlers as well as their related components and replacement parts.
−Removed: Customers use these products to construct and maintain industrial, commercial, institutional and residential buildings and facilities, for construction and maintenance of utility and telecommunication lines, tree trimming, certain construction and foundation drilling applications, and for other commercial operations, as well as in a wide range of infrastructure projects.
+Added: (i) MP and (ii) AWP.
MP designs, manufactures, services and markets materials processing and specialty equipment, including crushers, washing systems, screens, trommels, apron feeders, material handlers, pick and carry cranes, rough terrain cranes, tower cranes, wood processing, biomass and recycling equipment, concrete mixer trucks and concrete pavers, conveyors, and their related components and replacement parts.
Customers use these products in construction, infrastructure and recycling projects, in various quarrying and mining applications, as well as in landscaping and biomass production industries, material handling applications, maintenance applications to lift equipment or material, moving materials and equipment on rugged or uneven terrain, lifting construction material and placing material at point of use.
+Added: AWP designs, manufactures, services and markets aerial work platform equipment, utility equipment and telehandlers as well as their related components and replacement parts.
+Added: Customers use these products to construct and maintain industrial, commercial, institutional and residential buildings and facilities, for construction and maintenance of utility and telecommunication lines, tree trimming, certain construction and foundation drilling applications, and for other commercial operations, as well as in a wide range of infrastructure projects.
The Company assists customers in their rental, leasing and acquisition of its products through Terex Financial Services (“TFS”).
6 unchanged sentences
2022 2021 2020
−Removed: AWP $ 2,178.8 $ 1,782.9 $ 2,726.6
MP $ 1,941.6 $ 1,691.8 $ 1,256.8
+Added: AWP 2,483.6 2,178.8 1,782.9
Corporate and Other / Eliminations ( 7.5 ) 16.2 36.7
1 unchanged sentence
Income (loss) from operations
−Removed: AWP $ 152.1 $ 0.5 $ 196.2
MP $ 297.8 $ 240.9 $ 143.4
+Added: AWP 196.2 152.1 0.5
Corporate and Other / Eliminations ( 74.0 ) ( 65.0 ) ( 75.5 )
1 unchanged sentence
Depreciation and amortization
−Removed: AWP $ 25.9 $ 23.2 $ 23.0
MP $ 14.4 $ 13.3 $ 11.4
+Added: AWP 24.8 25.9 23.2
Corporate 8.0 11.0 15.1
1 unchanged sentence
Capital expenditures
−Removed: AWP $ 41.2 $ 47.4 $ 82.1
MP $ 25.2 $ 15.8 $ 11.6
+Added: AWP 77.6 41.2 47.4
Corporate 6.8 2.7 5.5
Total $ 109.6 $ 59.7 $ 64.5
−Removed: Sales between segments are generally priced to recover costs plus a reasonable markup for profit, which is eliminated in consolidation.
−Removed: (in millions) 2021 2020
Identifiable assets
$ 1,800.1 $ 1,648.0
−Removed: MP 1,648.0 1,596.3
+Added: 2,122.5 1,870.8
Corporate and Other / Eliminations (3)
( 804.5 ) ( 655.3 )
−Removed: Assets held for sale — 6.3
Total $ 3,118.1 $ 2,863.5
−Removed: (1) Increase primarily due to higher trade receivable and inventory balances.
−Removed: (2) Change primarily due to lower cash and finance receivable balances and higher intercompany eliminations.
+Added: (1) Increase primarily due to higher inventory.
+Added: (2) Increase primarily due to higher trade receivables and inventory.
+Added: (3) Change primarily due to higher intercompany eliminations.
+Added: Sales between segments are generally priced to recover costs plus a reasonable markup for profit, which is eliminated in consolidation.
Long-lived assets consist of net fixed assets, which can be attributed to the specific geographic regions (in millions):
Long-lived Assets
−Removed: United States $ 218.0 $ 237.4
+Added: $ 187.6 $ 218.0
United Kingdom 81.8 76.4
+Added: Mexico 82.6 22.9
China 54.1 55.8
4 unchanged sentences
Year Ended December 31, 2022
−Removed: AWP MP Corporate and Other / Eliminations Total
+Added: MP AWP Corporate and Other / Eliminations Total
Net sales by region
8 unchanged sentences
Year Ended December 31, 2021
−Removed: AWP MP Corporate and Other / Eliminations Total
+Added: MP AWP Corporate and Other / Eliminations Total
Net sales by region
8 unchanged sentences
Year Ended December 31, 2020
−Removed: AWP MP Corporate and Other / Eliminations Total
+Added: MP AWP Corporate and Other / Eliminations Total
Net sales by region
10 unchanged sentences
Year Ended December 31, 2022
−Removed: AWP MP Corporate and Other / Eliminations Total
+Added: MP AWP Corporate and Other / Eliminations Total
Net sales by product type
7 unchanged sentences
Year Ended December 31, 2021
−Removed: AWP MP Corporate and Other / Eliminations Total
+Added: MP AWP Corporate and Other / Eliminations Total
Net sales by product type
7 unchanged sentences
Year Ended December 31, 2020
−Removed: AWP MP Corporate and Other / Eliminations Total
+Added: MP AWP Corporate and Other / Eliminations Total
Net sales by product type
10 unchanged sentences
2022 2021 2020
−Removed: United States $ ( 16.7 ) $ ( 148.8 ) $ ( 32.4 )
+Added: $ ( 19.7 ) $ ( 16.7 ) $ ( 148.8 )
Foreign 386.3 280.5 159.8
15 unchanged sentences
The Company recorded Provision for (benefit from) income taxes of $( 0.3 ) million, $( 0.8 ) million and $( 9.3 ) million from discontinued operations and on disposition of discontinued operations for the years ended December 31, 2022, 2021 and 2020, respectively.
−Removed: In January 2018, the FASB released guidance on the accounting for tax on Global Intangible Low-taxed Income (“GILTI”).
−Removed: The guidance indicates that either accounting for deferred taxes related to GILTI or treating any taxes on GILTI as period costs are both acceptable accounting policy elections.
−Removed: Terex elected to treat taxes on GILTI inclusions as period costs.
−Removed: Deferred tax assets and liabilities result from differences in the bases of assets and liabilities for tax and financial reporting purposes.
−Removed: The tax effects of the basis differences and loss carry forwards as of December 31, 2021 and 2020 for continuing operations are summarized below for major balance sheet captions (in millions):
+Added: The tax effects of the basis differences between tax and financial reporting purposes for assets, liabilities and loss carry forwards as of December 31, 2022 and 2021 for continuing operations are summarized below for major balance sheet captions (in millions):
Property, plant and equipment $ ( 19.8 ) $ ( 16.1 )
5 unchanged sentences
Accrued compensation and benefits 17.1 15.8
−Removed: Operating lease ROU asset ( 23.5 ) ( 26.1 )
+Added: Operating lease right-of-use asset ( 22.0 ) ( 23.5 )
Operating lease liability 23.5 23.8
3 unchanged sentences
Deferred tax assets were $ 190.9 million before valuation allowances of $ 63.0 million, resulting in $ 127.9 million of net deferred tax assets which are partially offset by deferred tax liabilities of $ 4.3 million at December 31, 2022.
−Removed: Deferred tax assets for continuing operations were $ 251.6 million ($ 0.1 million for discontinued operations) before valuation allowances of $ 112.1 million, resulting in $139.5 million of net deferred tax assets which are partially offset by deferred tax liabilities for continuing operations of $ 2.6 million at December 31, 2020.
+Added: Deferred tax assets for continuing operations were $ 233.0 million before valuation allowances of $ 100.0 million, resulting in $ 133.0 million of net deferred tax assets which are partially offset by deferred tax liabilities for continuing operations of $ 2.5 million at December 31, 2021.
+Added: The net change in the total valuation allowance for the years ended December 31, 2022 and 2021 was a decrease of $ 37.0 million and $ 12.1 million, respectively.
There were no deferred tax liabilities for discontinued operations at December 31, 2022 and 2021.
−Removed: The Company evaluates the net realizable value of its deferred tax assets each reporting period.
−Removed: The Company must consider all objective evidence, both positive and negative, in evaluating the future realization of its deferred tax assets, including tax loss carry forwards.
−Removed: Available evidence, including historical information is supplemented by currently obtainable information about future tax years.
−Removed: Realization of deferred tax assets requires sufficient taxable income of the appropriate character.
−Removed: To the extent estimates of future taxable income decrease or do not materialize, additional valuation allowances may be required.
−Removed: The Company records a valuation allowance for each deferred tax asset for which realization is not assessed as more likely than not.
−Removed: The valuation allowance for deferred tax assets as of December 31, 2021 and 2020 was $ 100.0 million and $ 112.1 million, respectively.
−Removed: The net change in the total valuation allowance for the years ended December 31, 2021 and 2020 was a decrease of $ 12.1 million and an increase of $ 5.1 million, respectively.
+Added: As of December 31, 2022, the Company released the valuation allowance on its German interest expense deferred tax asset as the realization of the deferred tax asset is now more likely than not due to recent earnings history and expected future business performance resulting in a benefit from income taxes of $ 17.7 million.
The Company’s Provision for (benefit from) income taxes is different from the amount that would be provided by applying the statutory federal income tax rate to the Company’s Income (loss) from continuing operations before income taxes.
14 unchanged sentences
Provision for (benefit from) income taxes $ 66.4 $ 46.3 $ 2.0
−Removed: The Company does not provide for foreign income and withholding, U.S.
−Removed: Federal, or state income taxes or tax benefits on the financial reporting basis over the tax basis of its investments in foreign subsidiaries to the extent such amounts are indefinitely reinvested to support operations and continued growth plans outside the U.S.
−Removed: The Company reviews its plan to indefinitely reinvest on a quarterly basis.
−Removed: In making its decision to indefinitely reinvest, the Company evaluates its plans of reinvestment, its ability to control repatriation and to mobilize funds without triggering basis differences, and the profitability of U.S.
−Removed: operations and their cash requirements and the need, if any, to repatriate funds.
−Removed: If the assessment of the Company with respect to earnings of non-U.S.
−Removed: subsidiaries changes, deferred taxes for foreign income taxes and withholding, U.S.
−Removed: Federal or state income taxes or tax benefits may have to be accrued.
−Removed: The Company considers foreign earnings that have been taxed in the U.S.
−Removed: or have qualified for the high-tax exception to taxation to not be indefinitely reinvested.
−Removed: The Company has recorded foreign, federal and state tax expense with respect to earnings which have been subject to federal income tax and which are no longer indefinitely reinvested.
−Removed: The Company plans to indefinitely reinvest all undistributed foreign earnings in excess of those previously taxed in the U.S.
+Added: The Company’s effective tax rate was 18.1 %, 17.6 % and 18.2 % for the years ended December 31, 2022, 2021 and 2020, respectively .
For the year ended December 31, 2022, the Company’s estimate of its remaining unremitted earnings of its foreign subsidiary ownership chains that have positive retained earnings and have not been subject to tax in the U.S.
2 unchanged sentences
subsidiaries is not practicable.
−Removed: At December 31, 2021, the Company has various state net operating loss carry forwards available to reduce future state taxable income and income taxes, the majority of which will expire at various dates through 2041.
−Removed: The Company also has approximately $ 599 million of foreign loss carry forwards, consisting of $ 278 million in Germany, $ 168 million in Italy, $ 54 million in China, $ 31 million in India, and $ 68 million in other countries, which are available to offset future taxable income.
−Removed: The majority of these tax loss carry forwards are available without expiration.
−Removed: In addition, the gross amount of the Australian capital loss carryforward is $ 23 million, and it has an unlimited carryforward period.
+Added: At December 31, 2022, the Company has a state net operating loss carry forward deferred tax assets of $ 44 million available to reduce future taxable income and income taxes in various states, substantially all of which is offset by valuation allowances and will expire at various dates through 2042.
+Added: The Company has approximately $ 462 million of foreign operating loss carry forwards.
+Added: These loss carry forwards include $ 234 million in Germany, $ 157 million in Italy and $ 27 million in Spain which do not expire.
+Added: The remaining loss carry forwards of $ 44 million are partially offset by valuation allowances and the majority do not expire.
+Added: Also, the Company has an Indian capital loss carry forward of $ 23 million expiring before 2028 and an Australian capital loss carry forward of $ 21 million which does not expire;
+Added: both are offset by valuation allowances.
The Company made total net income tax payments including discontinued operations of $ 20.4 million, $ 28.4 million and $ 26.3 million in 2022, 2021 and 2020, respectively.
At December 31, 2022 and 2021, Other current assets included net income tax receivable amounts of $ 14.7 million and $ 52.4 million, respectively.
−Removed: The Company and its subsidiaries conduct business globally and file income tax returns in U.S.
−Removed: Federal, state and foreign jurisdictions, as required.
−Removed: From a tax perspective, major jurisdictions where the Company is often subject to examination by tax authorities include Germany, Italy, the United Kingdom (“U.K.”), China, India and the U.S.
−Removed: Currently, various entities of the Company are under audit in Italy, India and elsewhere.
−Removed: With limited exceptions, the statute of limitations for the Company and most of its subsidiaries has expired for tax years prior to 2016.
−Removed: The Company assesses uncertain tax positions for recognition, measurement and effective settlement.
−Removed: Where the Company has determined that its tax return filing position does not satisfy the more likely than not recognition threshold of ASC 740, “Income Taxes,” it has recorded no tax benefits.
−Removed: Where the Company has determined that its tax return filing positions are more likely than not to be sustained, the Company has measured and recorded the largest amount of tax benefit greater than 50% likely to be realized.
−Removed: The Company recognizes accrued interest and penalties, if any, related to income taxes as (Provision for) benefit from income taxes in its Consolidated Statement of Income (Loss).
The following table summarizes the activity related to the Company’s unrecognized tax benefits (in millions).
21 unchanged sentences
Balance as of December 31, 2022
−Removed: The Company evaluates each reporting period whether it is reasonably possible material changes to its uncertain tax position liability could occur in the next 12 months.
−Removed: Changes may occur as a result of uncertain tax positions being considered effectively settled, re-measured, paid, acquired or divested, as a result of a change in tax law or judicial decision, or due to expiration of the relevant statute of limitations.
−Removed: It is not possible to predict which uncertain tax positions, if any, may be challenged by tax authorities.
−Removed: Timing and impact of income tax audits and their resolution is uncertain.
−Removed: New facts, laws, pronouncements and judicial decisions can change assessments concerning technical merit and measurement.
−Removed: The amounts of or periods in which changes to reserves for uncertain tax positions will occur is difficult to predict.
+Added: From a tax perspective, major jurisdictions where the Company is often subject to examination by tax authorities include Germany, Italy, the United Kingdom (“U.K.”), China, India and the U.S.
+Added: Currently, various entities of the Company are under audit in Italy, India, U.S.
+Added: and elsewhere.
+Added: With limited exceptions, the statute of limitations for the Company and most of its subsidiaries has expired for tax years prior to 2017.
The Company does not expect the amount of unrecognized tax benefits disclosed as of December 31, 2022 will change materially in 2023.
1 unchanged sentence
Of the $ 2.5 million at December 31, 2022, $ 1.7 million, if recognized, would affect the effective tax rate.
−Removed: Potential interest and penalties were a receivable of $ 0.2 million and a liability of $ 1.4 million as of December 31, 2021 and 2020, respectively.
+Added: Potential interest and penalties were a liability of $ 0.3 million and a receivable of $ 0.2 million as of December 31, 2022 and 2021, respectively.
During the years ended December 31, 2022 and 2021, the Company recognized total tax (benefit) expense of $ 0.1 million and $( 1.5 ) million for interest and penalties, respectively.
−Removed: NOTE D – ACQUISITIONS AND DISCONTINUED OPERATIONS
+Added: NOTE D – ACQUISITIONS AND DISPOSITIONS
+Added: 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 MP products.
+Added: Total cash consideration was approximately $ 6 million.
+Added: On July 29, 2022, the Company acquired a 100 % ownership interest in ProAll International Mfg.
+Added: and ProAll UK Limited and related assets (“ProAll”), a manufacturer of volumetric mixers based in Canada, to expand the Company’s concrete product offering.
+Added: Total consideration, including estimated contingent consideration from earn out provisions, was approximately $ 40 million.
+Added: The Company remeasured the earn-out liability at December 31, 2022 and recorded the adjustment in earnings as an operating expense.
On July 6, 2021, the Company acquired all of the outstanding shares of Murray Design & Engineering, Ltd (“MDS”), a manufacturer of heavy duty aggregate and recycling trommels, apron feeders and conveyor systems, based in the Republic of Ireland.
Total cash consideration transferred was approximately $ 19 million.
−Removed: 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.
+Added: 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.
−Removed: See Note H – “Goodwill and Intangible Assets, Net” for additional information regarding goodwill recognized as a result of the acquisition.
−Removed: MDS’s results of operations are consolidated within the MP segment in the consolidated financial statements from the date of acquisition.
+Added: The results of operations associated with these businesses are consolidated within the MP segment in the Consolidated Financial Statements from the respective dates of acquisition.
+Added: See Note H – “Goodwill and Intangible Assets” for additional information regarding goodwill recognized as a result of these acquisitions.
On May 25, 2021, the Company acquired assets to facilitate manufacturing of certain MP products in China.
1 unchanged sentence
The transaction was recorded as an asset acquisition at cost, with the consideration allocated to individual assets acquired.
−Removed: On November 30, 2021, the Company sold its utility hot lines tools business located in South America, which had been recorded as assets and liabilities held for sale prior to its disposition.
+Added: On November 30, 2021, the Company sold its utility hot line tools business located in South America.
The Company received consideration of $ 5.8 million from the sale at fair value and recognized a gain of $ 6.4 million included in SG&A in the Consolidated Statement of Income (Loss).
Prior to disposition, the results of operations for the hot lines tools business, including any impairment reserves taken, were consolidated within the AWP segment in the consolidated financial statements.
−Removed: On July 31, 2019, the Company completed the disposition of Demag ® mobile cranes business to Tadano Ltd.
−Removed: and certain of its subsidiaries.
−Removed: During 2019, the Company also exited North American mobile crane product lines manufactured in its Oklahoma City facility.
−Removed: The Company’s actions to sell Demag and cease manufacturing of mobile crane product lines in its Oklahoma City facility represented a significant strategic shift in its business away from mobile cranes as these businesses constituted a significant part of its operations and financial results.
−Removed: The Company believes these actions were necessary to execute its strategy.
−Removed: As a result, the Company reported these operations, formerly part of the Cranes segment, in discontinued operations in the Consolidated Statement of Income (Loss) for all periods presented.
−Removed: Income (Loss) from Discontinued Operations
−Removed: The Company reported certain operations, formerly part of the Cranes segment, in discontinued operations in the Consolidated Statement of Income (Loss) for all periods presented.
−Removed: The following information was derived from historical financial information and has been segregated from continuing operations (in millions):
−Removed: Year ended December 31,
−Removed: Net sales $ 6.0 $ 327.2
−Removed: Cost of sales
−Removed: ( 5.8 ) ( 335.2 )
−Removed: Selling, general and administrative expenses
−Removed: ( 0.9 ) ( 75.6 )
−Removed: Impairment of mobile cranes disposal group — ( 82.1 )
−Removed: Asset impairments ( 0.1 ) —
−Removed: Other income (expense)
−Removed: Income (loss) from discontinued operations before income taxes
−Removed: ( 0.8 ) ( 170.2 )
−Removed: (Provision for) benefit from income taxes
−Removed: Income (loss) from discontinued operations – net of tax $ ( 0.4 ) $ ( 155.4 )
−Removed: The following table provides supplemental cash flow information related to discontinued operations (in millions):
−Removed: Year Ended December 31,
−Removed: Non-cash operating items:
−Removed: Depreciation and amortization $ — $ 3.3
−Removed: Deferred taxes
−Removed: $ 0.1 $ ( 1.4 )
−Removed: Impairments $ 0.1 $ 82.1
−Removed: Investing activities:
−Removed: Capital expenditures $ — $ ( 3.4 )
+Added: Assets Held for Sale
+Added: Long-lived assets expected to be sold or otherwise disposed of within one year are classified as assets held for sale and included in Other assets in the Consolidated Balance Sheet.
+Added: The Company classified a facility as an asset held for sale in its AWP segment, as part of realignment of its manufacturing footprint, at December 31, 2022, with a carrying value of approximately $ 31 million.
Gain (Loss) on Disposition of Discontinued Operations - net of tax (in millions)
1 unchanged sentence
2022 2021 2020
−Removed: Cranes MHPS Total Cranes MHPS Total Cranes MHPS Other Total
+Added: Cranes MHPS Total Cranes MHPS Total Cranes MHPS Total
Gain (loss) on disposition of discontinued operations $ ( 0.5 ) $ — $ ( 0.5 ) $ 1.4 $ 1.2 $ 2.6 $ ( 27.7 ) $ ( 0.4 ) $ ( 28.1 )
36 unchanged sentences
Inventories $ 988.4 $ 813.5
+Added: Work-in-process inventory includes approximately $ 36 million and $ 10 million of substantially completed inventory awaiting installation of final components at December 31, 2022 and 2021, respectively.
Reserves for lower of cost or NRV and excess and obsolete inventory were $ 61.0 million and $ 57.8 million at December 31, 2022 and 2021, respectively.
17 unchanged sentences
173.4 102.0 275.4
+Added: Acquisitions 7.3 — 7.3
Foreign exchange effect and other ( 1.7 ) ( 0.9 ) ( 2.6 )
10 unchanged sentences
Balance at December 31, 2022, net
−Removed: In connection with the MDS acquisition, the Company recognized goodwill of $ 7.3 million during the year.
−Removed: The goodwill was assigned to the MP reporting unit and attributable primarily to the assembled workforce and expected synergies from the business combination.
−Removed: The goodwill is not expected to be deductible for income tax purposes.
−Removed: See Note D – “Acquisitions and Discontinued Operations” for additional information regarding the MDS acquisition.
+Added: $ 185.0 $ 99.4 $ 284.4
+Added: During the year ended December 31, 2022, the Company recognized goodwill of $ 3.5 million in connection with the Steelweld acquisition and $ 18.0 million in connection with the ProAll acquisition.
+Added: During the year ended December 31, 2021, the Company recognized goodwill of $ 7.3 million in connection with the MDS acquisition.
+Added: The goodwill associated with these transactions was attributable primarily to the assembled workforce and expected synergies from the business combinations.
+Added: The goodwill was assigned to the MP segment and is not expected to be deductible for income tax purposes.
+Added: See Note D – “Acquisitions and Dispositions” for additional information regarding the acquisitions.
Intangible assets, net were comprised of the following (in millions):
10 unchanged sentences
$ 77.9 $ ( 60.5 ) $ 17.4 $ 72.4 $ ( 59.0 ) $ 13.4
−Removed: In connection with the MDS acquisition, the Company recognized customer relationships of $ 6.3 million with an estimated useful life of 7 years and trademarks of $ 1.3 million with an estimated useful life of 10 years during the year.
−Removed: See Note D – “Acquisitions and Discontinued Operations” for additional information regarding the MDS acquisition.
+Added: During the year ended December 31, 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.
+Added: During the year ended December 31, 2021, the Company recognized customer relationships of $ 6.3 million with an estimated useful life of seven years and trademarks of $ 1.3 million with an estimated useful life of ten years in connection with the MDS acquisition.
+Added: See Note D – “Acquisitions and Dispositions” for additional information regarding these acquisitions.
For the Year Ended December 31,
4 unchanged sentences
The Company operates internationally, with manufacturing and sales facilities in various locations around the world.
−Removed: In the normal course of business, the Company uses cash flow derivatives to manage exposures.
+Added: In the normal course of business, the Company uses derivatives to manage commodity, currency and interest rate exposures.
For a derivative to qualify for hedge accounting treatment at inception and throughout the hedge period, the Company formally documents the nature and relationships between hedging instruments and hedged items, as well as its risk-management objectives and strategies for undertaking various hedge transactions, and methods of assessing hedge effectiveness.
4 unchanged sentences
The Company records all derivative contracts at fair value on a recurring basis.
−Removed: The Company’s derivative financial instruments are categorized under the ASC 820 hierarchy;
−Removed: see Note A – “Basis of Presentation” for an explanation of the hierarchy.
−Removed: Commodity Swaps and Interest Rate Caps
−Removed: Derivatives designated as cash flow hedging instruments include commodity swaps and interest rate caps.
−Removed: The outstanding notional value of commodity swaps was $ 22.5 million as of December 31, 2021.
−Removed: There were no interest rate caps outstanding at December 31, 2021.
−Removed: Commodity swaps outstanding at December 31, 2021 mature on or before August 31, 2022.
−Removed: The outstanding notional amount of commodity swaps and interest rate caps was $ 26.0 million and $ 300.0 million, respectively, at December 31, 2020.
−Removed: The Company uses commodity swaps to mitigate price risk for hot rolled coil steel and interest rate caps to mitigate its exposure to changes in interest rates related to variable rate debt.
−Removed: Fair values of commodity swaps are based on observable market data for similar assets and liabilities.
−Removed: Fair values of interest rate caps are based on the present value of future cash payments and receipts.
−Removed: Changes in the fair value of commodity swaps and interest rate caps are deferred in Accumulated other comprehensive income (loss) (“AOCI”).
+Added: Commodity Swaps
+Added: Derivatives designated as cash flow hedging instruments include commodity swaps with outstanding notional value of $ 22.5 million and $ 22.5 million at December 31, 2022 and 2021, respectively.
+Added: Commodity swaps outstanding at December 31, 2022 mature on or before November 1, 2024.
+Added: The Company uses commodity swaps to mitigate price risk for hot rolled coil steel.
+Added: Fair value of commodity swaps are based on observable market data for similar assets and liabilities.
+Added: Changes in the fair value of commodity swaps are deferred in AOCI.
Gains or losses on commodity swaps are reclassified to COGS in the Consolidated Statement of Income (Loss) when the hedged transaction affects earnings.
−Removed: Gains or losses on interest rate caps are reclassified to Interest expense in the Consolidated Statement of Income (Loss) when the underlying hedged transactions occur.
Cross Currency Swaps
8 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.
−Removed: Foreign exchange contracts outstanding at December 31, 2021 mature during the first half of 2022.
−Removed: At December 31, 2021 and 2020, the Company had $ 19.4 million and $ 7.8 million notional value, respectively, of foreign exchange contracts outstanding that were designated as cash flow hedge contracts.
+Added: Foreign exchange contracts outstanding at December 31, 2022 mature on or before July 2023.
+Added: The Company had $ 7.8 million and $ 19.4 million notional value of foreign exchange contracts outstanding that were designated as cash flow hedging instruments at December 31, 2022 and 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.
−Removed: Gains or losses on foreign exchange contracts are reclassified to COGS in the Company’s Consolidated Statement of Income (Loss).
−Removed: The Company had $ 139.7 million and $ 54.2 million notional value of foreign exchange contracts outstanding that were not designated as hedging instruments at December 31, 2021 and 2020, respectively.
−Removed: The majority of gains and losses recognized from foreign exchange contracts not designated as hedging instruments are offset by changes in the underlying hedged items, resulting in no material net impact on earnings.
+Added: Gains or losses on foreign exchange contracts are reclassified to COGS in the Consolidated Statement of Income (Loss).
+Added: The Company had $ 241.1 million and $ 139.7 million notional value of foreign exchange contracts outstanding that were not designated as cash flow hedging instruments at December 31, 2022 and 2021, respectively.
+Added: 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.
Changes in the fair value of these derivative financial instruments are recognized as gains or losses in COGS and Other income (expense) – net in the Consolidated Statement of Income (Loss).
+Added: Interest Rate Caps
+Added: In October 2021, the Company terminated all outstanding interest rate caps.
+Added: The Company used interest rate caps to mitigate its exposure to changes in interest rates related to variable rate debt.
+Added: Fair value of interest rate caps were based on the present value of future cash payments and receipts.
+Added: Changes in the fair value of interest rate caps were deferred in AOCI.
+Added: Gains or losses on interest rate caps were reclassified to Interest expense in the Consolidated Statement of 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 Consolidated Balance Sheet (in millions):
4 unchanged sentences
Commodity swaps Other current assets 0.3 — 4.3 —
−Removed: Commodity swaps Other non-current assets — — 0.3 —
+Added: Foreign exchange contracts Other current liabilities ( 0.3 ) ( 2.0 ) — —
Cross currency swaps - net investment hedge Other current liabilities ( 1.7 ) — ( 0.5 ) —
−Removed: Interest rate caps Other current liabilities — — ( 1.2 ) —
Commodity swaps Other current liabilities ( 1.5 ) — ( 1.1 ) —
Cross currency swaps - net investment hedge Other non-current liabilities ( 3.0 ) — ( 2.4 ) —
−Removed: Interest rate caps Other non-current liabilities — — ( 2.6 ) —
+Added: Commodity swaps Other non-current liabilities ( 0.4 ) — — —
Net derivative asset (liability) $ ( 6.6 ) $ ( 0.3 ) $ 0.2 $ 0.7
1 unchanged sentence
The following tables provide the effect of derivative instruments that are designated as hedges in AOCI (in millions):
−Removed: Gain (Loss) Recognized on Derivatives in OCI, net of tax Gain (Loss) Reclassified from AOCI into Income
+Added: Gain (Loss) Recognized on Derivatives in OCI, net of tax Gain (Loss) Reclassified from AOCI into Income (Loss)
Year Ended December 31, Year Ended December 31,
3 unchanged sentences
Commodity swaps ( 12.1 ) 2.4 $ 7.0 Cost of goods sold 8.1 15.6 ( 2.4 )
−Removed: Cross currency swaps - cash flow hedge — — 0.6 Other income (expense) - net — — 1.1
Cross currency swaps - net investment hedges 1.8 4.8 ( 8.8 ) Selling, general and administrative expenses — — —
2 unchanged sentences
The following tables provide the effect of derivative instruments that are designated as hedges in the Consolidated Statement of Income (Loss) (in millions):
−Removed: Classification and amount of Gain or Loss
−Removed: Recognized in Income
−Removed: Cost of goods sold Interest Expense Other income (expense) - net
+Added: Classification and amount of Gain (Loss)
+Added: Recognized in Income (Loss)
+Added: Cost of goods sold Interest expense
Year Ended December 31,
3 unchanged sentences
Commodity swaps 8.1 15.6 ( 2.4 ) — — —
−Removed: Cross currency swaps - cash flow hedge — — — — — — — — 1.1
Interest rate caps — — — — ( 1.2 ) ( 0.4 )
3 unchanged sentences
Derivatives not designated as hedges are used to offset foreign exchange gains or losses resulting from the underlying exposures of foreign currency denominated assets and liabilities.
−Removed: The following table provides the effect of non-designated derivatives outstanding at the end of the period in the Consolidated Statement of Income (Loss) (in millions):
+Added: The following table provides the effect of non-designated derivatives in the Consolidated Statement of Income (Loss) (in millions):
+Added: Gain (Loss) Recognized in Income (Loss)
Year Ended December 31,
2 unchanged sentences
Foreign exchange contracts Other income (expense) – net 0.1 0.5 —
−Removed: Debt conversion feature (1)
−Removed: Other income (expense) – net — — ( 0.5 )
Total $ ( 2.1 ) $ — $ 0.6
−Removed: (1) Debt conversion feature on a convertible promissory note held by the Company.
−Removed: In the Consolidated Statement of Income (Loss), the Company records hedging activity related to commodity swaps, interest rate caps, cross currency swaps, foreign exchange contracts and the debt conversion feature in the accounts for which the hedged items are recorded.
+Added: In the Consolidated Statement of Income (Loss), the Company records hedging activity related to commodity swaps, cross currency swaps, foreign exchange contracts and interest rate caps in the accounts for which the hedged items are recorded.
On the Consolidated Statement of Cash Flows, the Company presents cash flows from hedging activities in the same manner as it records the underlying item being hedged.
3 unchanged sentences
See Note M – “Stockholders’ Equity” for unrealized net gains (losses), net of tax, included in AOCI.
−Removed: Within unrealized net gains (losses) included in AOCI as of December 31, 2021, it is estimated that $ 2.0 million of gains are expected to be reclassified into earnings in the next twelve months.
+Added: Within unrealized net gains (losses) included in AOCI as of December 31, 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
Long-term debt is summarized as follows (in millions):
−Removed: 5% Senior Notes due May 15, 2029, net of unamortized debt issuance costs of $ 6.9 at December 31, 2021
−Removed: 5-5/8% Senior Notes due February 1, 2025, net of unamortized debt issuance costs of $ 6.0 at December 31, 2020
−Removed: Credit Agreement – term debt due January 31, 2024 (“Original Term Loan”, as defined below), net of unamortized debt issuance costs of $ 0.4 and $ 3.0 at December 31, 2021 and 2020, respectively
−Removed: Credit Agreement – term debt due January 31, 2024 (“2019 Term Loan”, as defined below), net of unamortized debt issuance costs of $ 1.6 at December 31, 2020
+Added: 5% Senior Notes due May 15, 2029, net of unamortized debt issuance costs of $ 6.0 and $ 6.9 million at December 31, 2022 and 2021, respectively
+Added: $ 594.0 $ 593.1
+Added: Credit Agreement – term debt due January 31, 2024 (“Original Term Loan”, as defined below), net of unamortized debt issuance costs of $ 0.4 at December 31, 2021
+Added: Credit Agreement - revolving line of credit expires on April 1, 2026 177.0 —
Finance lease obligations 4.2 3.5
4 unchanged sentences
Credit Agreement
−Removed: 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”).
+Added: 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.
+Added: 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:
−Removed: (i) extension of the term of the Revolver to expire on April 1, 2026, which maturity will spring forward to November 1, 2023 if the principal outstanding under the $ 400 million senior secured term loan (the “Original Term Loan”) is not repaid or its maturity date is not extended, (ii) reinstatement of financial covenants that were waived in 2020, (iii) decrease in the interest rate on the drawn Revolver by 25 basis points and (iv) certain other technical changes, including additional language regarding the potential cessation of LIBOR as a benchmark rate.
+Added: (i) extension of the term of the Revolver to expire on April 1, 2026, (ii) reinstatement of financial covenants that were waived in 2020, (iii) decrease in the interest rate on the drawn Revolver by 25 basis points and (iv) certain other technical changes, including additional language regarding the potential cessation of LIBOR as a benchmark rate.
The Company recorded a loss on early extinguishment of debt related to the amendment and restatement of the Credit Agreement of $ 2.4 million in the second quarter of 2021.
−Removed: On March 7, 2019, the Company entered into an Incremental Assumption Agreement and Amendment No.
−Removed: 3 (“Amendment No.
−Removed: 3”) to its credit agreement.
−Removed: Amendment No.
−Removed: 3 provided the Company with an additional term loan (the “2019 Term Loan”) in the amount of $ 200 million.
+Added: In 2019, the Company entered into an Incremental Assumption Agreement and amendment to its credit agreement that provided the Company with an additional term loan (the “2019 Term Loan”) in the amount of $ 200.0 million.
During the first quarter of 2021, the Company prepaid the 2019 Term Loan prior to its maturity date to reduce the Company’s outstanding debt and lower its leverage.
1 unchanged sentence
The 2019 Term Loan bore interest at a rate of LIBOR plus 2.75 % with a 0.75 % LIBOR floor.
−Removed: The Original Term Loan under the Credit Agreement bears interest at a rate of LIBOR plus 2.00 % with a 0.75 % LIBOR floor.
−Removed: During the year ended December 31, 2021, the Company prepaid $ 303 million of the amount outstanding on the Original Term Loan prior to its maturity date to reduce the Company’s outstanding debt and lower its leverage.
−Removed: The Company recorded a loss on early extinguishment of debt related to prepayment of $ 2.4 million for accelerated amortization of debt acquisition costs and original issue discount.
+Added: During the year ended December 31, 2022 and 2021, the Company prepaid $ 78.0 million and $ 303.0 million, respectively, of the $400 million senior secured term loan (“Original Term Loan”) prior to its maturity date to reduce the Company’s outstanding debt and lower its leverage.
+Added: The Company recorded a loss on early extinguishment of debt related to prepayment of $ 0.3 million and $ 2.4 million in 2022 and 2021, respectively, for accelerated amortization of debt acquisition costs and original issue discount.
+Added: The Original Term Loan bore interest at a rate of LIBOR plus 2.00 % with a 0.75 % LIBOR floor.
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.
10 unchanged sentences
The Company was in compliance with all covenants contained in the Credit Agreement as of December 31, 2022.
−Removed: As of December 31, 2021 and 2020, the Company had $ 77.8 million and $ 579.9 million, net of discount, respectively, in Term Loans outstanding under the Credit Agreement.
−Removed: The weighted average interest rate on the Term Loans at December 31, 2021 and 2020 was 2.75 % and 3.00 %, respectively.
−Removed: The Company had no revolving credit amounts outstanding as of December 31, 2021 and 2020.
+Added: The Company had no Term Loans outstanding at December 31, 2022 and $ 77.8 million, net of discount, in Term Loans outstanding at December 31, 2021.
+Added: The weighted average interest rate on the Term Loans at December 31, 2021 was 2.75 %.
+Added: The Company had $ 177.0 million of Revolver amounts outstanding at December 31, 2022 and no Revolver amounts outstanding at December 31, 2021.
+Added: The weighted average interest rate on the Revolver at December 31, 2022 was 6.10 %.
The Company obtains letters of credit that generally serve as collateral for certain liabilities included in the Consolidated Balance Sheet and guaranteeing the Company’s performance under contracts.
12 unchanged sentences
Total $ 118.4 $ 107.8
−Removed: Furthermore, the Company and certain of its subsidiaries agreed to take certain actions to secure borrowings under the Credit Agreement.
−Removed: As a result, Terex and certain of its subsidiaries entered into a Guarantee and Collateral Agreement with CSAG, as collateral agent for the lenders, granting security and guarantees to the lenders for amounts borrowed under the Credit Agreement.
+Added: On January 31, 2017, the Company entered into a Guarantee and Collateral Agreement with CSAG, as collateral agent for the lenders, granting security and guarantees to the lenders for amounts borrowed under the Credit Agreement.
Pursuant to the Guarantee and Collateral Agreement, Terex is required to (a) pledge as collateral the capital stock of the Company’s material domestic subsidiaries and 65 % of the capital stock of certain of the Company’s material foreign subsidiaries and (b) provide a first priority security interest in substantially all of the Company’s domestic assets.
+Added: On December 29, 2022, the Company entered into an amendment to the guarantee and collateral agreement within the Credit Agreement which included the following principal changes to the original agreement:
+Added: (i) enabling a subsidiary to enter into hedging derivatives with external counterparties and (ii) inclusion of Terex subsidiary entities’ cash management services provided by lending banks to be secured under the guarantee and collateral agreement.
5-5/8% Senior Notes
20 unchanged sentences
5% Notes $ 600.0 0.89250 $ 535.5
−Removed: Original Term Loan (net of discount) 77.8 0.99875 77.7
2021 Book Value Quote Fair Value
1 unchanged sentence
Original Term Loan (net of discount) 77.8 0.99875 77.7
−Removed: 2019 Term Loan (net of discount) 195.9 0.99000 193.9
−Removed: The fair value of debt reported in the table above is based on adjusted price quotations on the debt instruments in an active market.
+Added: The fair value of debt reported in the table above is based on adjusted price quotations on the debt instruments in an inactive market.
The Company believes that the carrying value of its other borrowings, including amounts outstanding, if any, for the revolving credit line under the Credit Agreement, approximate fair market value based on maturities for debt of similar terms.
−Removed: Fair value of debt reported in the table above are categorized under Level 2 of the ASC 820 hierarchy.
+Added: Fair values of debt reported in the table above are categorized under Level 2 of the ASC 820 hierarchy.
See Note A – “Basis of Presentation” for an explanation of ASC 820 hierarchy.
−Removed: The Company paid $ 51.3 million, $ 58.1 million and $ 70.9 million of interest in 2021, 2020 and 2019, respectively.
+Added: The Company paid $ 37.4 million, $ 51.3 million and $ 58.1 of interest in 2022, 2021 and 2020, respectively.
NOTE K – LEASES
16 unchanged sentences
Total operating lease costs $ 41.3 $ 39.7 $ 41.7
−Removed: Variable lease costs are expensed as incurred and are not included in the determination of ROU assets or lease liabilities.
+Added: Variable lease costs are expensed as incurred and are not included in the determination of right-of-use assets or lease liabilities.
Operating lease obligations consist primarily of commitments to rent real properties.
60 unchanged sentences
Interest cost 1.2 1.1 2.6 2.3 0.1 0.1
−Removed: Settlements — — — ( 1.3 ) — —
−Removed: Curtailments — — — ( 1.0 ) — —
Plan amendments — — 0.5 ( 0.2 ) — —
7 unchanged sentences
Actual return on plan assets — — ( 47.7 ) 6.1 — —
−Removed: Settlements — — — ( 1.3 ) — —
Employer contribution 2.4 2.4 6.3 7.1 0.2 0.3
10 unchanged sentences
Amounts recognized in accumulated other comprehensive loss consist of:
−Removed: Actuarial net loss $ 5.6 $ 7.1 $ 38.4 $ 52.1 $ — $ 0.2
+Added: Actuarial net (gain) loss $ ( 4.3 ) $ 5.6 $ 50.0 $ 38.4 $ ( 0.5 ) $ —
Prior service cost — — 2.7 2.6 — —
2 unchanged sentences
(1) Actuarial gains related to U.S.
−Removed: pension benefits for the year ended December 31, 2021 were due primarily to higher discount rates when compared to the rate used in the prior year.
−Removed: Actuarial losses related to U.S.
−Removed: pension benefits for the year ended December 31, 2020 were due primarily to lower discount rates when compared to the rate used in the prior year.
+Added: pension benefits for the years ended December 31, 2022 and 2021 were due primarily to higher discount rates when compared to the rate used in the prior year.
Pension Benefits Non-U.S.
17 unchanged sentences
Amortization of actuarial loss 0.2 0.3 — 1.1 2.1 1.7 — — —
−Removed: Settlements — — — — — 0.6 — — —
Other — — — ( 0.3 ) ( 0.2 ) ( 0.9 ) — — —
2 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.
−Removed: Pension Settlements
−Removed: Participants in the Company’s U.K.
−Removed: pension plan may elect to receive a lump-sum settlement of remaining pension benefits under the terms of the plan.
−Removed: As a result of participants electing the lump-sum option during the year ended December 31, 2019, the Company settled $ 2.4 million of non-U.S.
−Removed: pension obligations.
−Removed: The settlements were paid from plan assets and did not require a cash contribution from the Company.
−Removed: As a result, the Company recorded settlement losses of $ 0.6 million reflecting the accelerated recognition of unamortized losses in the plan proportionate to the obligation that was settled in 2019.
Pension Benefits Non-U.S.
82 unchanged sentences
2028-2032 $ 12.1 $ 36.7 $ 0.5
−Removed: For the other benefits, for measurement purposes, an 8.50 % rate of increase in the per capita cost of covered health care benefits was assumed for 2021, dropping to 7 % in 2022 and then decreasing one-half percentage point per year until it reaches 4.00 % for 2028 and thereafter.
+Added: For the other benefits, for measurement purposes, a 7 % rate of increase in the per capita cost of covered health care benefits was assumed for 2022, dropping to 6 % in 2023 and then decreasing one-half percentage point per year until it reaches 3.50 % for 2028 and thereafter.
A one-percentage-point change in assumed health care cost trend rates would not have a material effect on total service and interest cost components or post-retirement benefit obligation.
3 unchanged sentences
Common Stock in Treasury
−Removed: The Company values treasury stock on an average cost basis.
+Added: The Company values treasury stock on a cost basis.
As of December 31, 2022, the Company held 17.2 million shares of common stock in treasury totaling $ 560.3 million, which include 0.7 million shares held in a trust for the benefit of the Company’s deferred compensation plan totaling $ 20.9 million.
2 unchanged sentences
As of December 31, 2022 and 2021, there were no shares of preferred stock outstanding.
−Removed: Long-Term Incentive Plans
+Added: Stock-Based Compensation
In May 2021, the stockholders approved the Terex Corporation Amended and Restated 2018 Omnibus Incentive Plan (the “2018 Plan”) which increased the number of shares of common stock (“Shares”) authorized for issuance by 2.0 million.
3 unchanged sentences
As of December 31, 2022, 2.8 million shares were available for grant under the 2018 Plan.
−Removed: Under the 2018 Plan, approximately 58 % of outstanding awards are time-based and vest ratably on each of the first three anniversary dates.
+Added: During the year ended December 31, 2022, the Company awarded 0.7 million shares of Restricted Stock Awards to its employees with a weighted average grant date fair value of $ 40.16 per share.
+Added: Approximately 60 % of these awards are time-based and vest ratably on each of the first three anniversary dates.
Approximately 27 % cliff vest at the end of a three-year period and are subject to performance targets that may or may not be met and for which the performance period has not yet been completed.
Approximately 13 % cliff vest and are based on performance targets containing a market condition determined over a three-year period.
−Removed: Fair value of restricted stock awards is based on the market price at the date of grant approval except for 0.4 million shares based on a market condition.
−Removed: The Company uses the Monte Carlo method to provide grant date fair value for awards with a market condition.
+Added: Fair value of Restricted Stock Awards is based on the market price at the date of grant approval except for awards based on a market condition.
+Added: The Company used the Monte Carlo method to determine grant date fair value for awards with a market condition.
The Monte Carlo method is a statistical simulation technique used to provide the grant date fair value of an award.
1 unchanged sentence
Grant date Grant date Grant date
−Removed: March 4, 2021 February 26, 2020 March 12, 2019
+Added: March 17, 2022 March 4, 2021 February 26, 2020
Dividend yields 1.31 % 1.12 % 2.12 %
−Removed: Expected historical volatility 53.03 % 36.36 % 36.64 %
+Added: Expected volatility 54.25 % 53.03 % 36.36 %
Risk free interest rate 2.09 % 0.29 % 1.14 %
7 unchanged sentences
Nonvested at December 31, 2021
+Added: 1,887,706 $ 34.44
Granted 739,307 $ 40.16
2 unchanged sentences
Nonvested at December 31, 2022
+Added: 1,849,796 $ 37.36
As of December 31, 2022, unrecognized compensation costs related to restricted stock totaled approximately $ 34 million, which will be expensed over a weighted average period of 1.7 years.
12 unchanged sentences
Balance at January 1, 2020
+Added: $ ( 208.2 ) $ ( 0.8 ) $ 2.6 $ ( 51.1 ) $ ( 257.5 )
Current year change 63.0 ( 5.2 ) ( 1.4 ) ( 7.3 ) 49.1
Balance at December 31, 2020
+Added: ( 145.2 ) ( 6.0 ) 1.2 ( 58.4 ) ( 208.4 )
Current year change ( 42.8 ) 10.0 ( 1.2 ) 13.9 ( 20.1 )
Balance at December 31, 2021
+Added: ( 188.0 ) 4.0 — ( 44.5 ) ( 228.5 )
Current year change ( 97.5 ) ( 10.4 ) ( 3.5 ) ( 1.7 ) ( 113.1 )
Balance at December 31, 2022
−Removed: As of December 31, 2021, accumulated other comprehensive income (loss) for the cumulative translation adjustment, derivative hedging adjustment, debt and equity securities adjustment and pension liability adjustment are net of a tax benefit/(provision) of $ 9.9 million, $( 1.4 ) million, $( 0.1 ) million and $ 2.1 million, respectively.
+Added: $ ( 285.5 ) $ ( 6.4 ) $ ( 3.5 ) $ ( 46.2 ) $ ( 341.6 )
+Added: As of December 31, 2022, AOCI for the cumulative translation adjustment, derivative hedging adjustment, debt and equity securities adjustment and pension liability adjustment are net of a tax benefit/(provision) of $ 7.7 million, $ 1.5 million, $ 0.9 million and $ 1.7 million, respectively.
Changes in Accumulated Other Comprehensive Income (Loss)
1 unchanged sentence
All amounts are net of tax (in millions).
−Removed: Year ended December 31, 2021 Year ended December 31, 2020
+Added: Year ended December 31, 2022
+Added: Year ended December 31, 2021
CTA Derivative
11 unchanged sentences
In July 2018, Terex’s Board of Directors authorized the repurchase up to $ 300 million of the Company’s outstanding shares of common stock.
−Removed: The table below presents shares repurchased by the Company during the years ended December 31, 2021, 2020 and 2019 under this program:
+Added: In December 2022, Terex’s Board of Directors authorized the additional repurchase up to $ 150 million of the Company’s outstanding shares of common stock.
+Added: The table below presents shares repurchased, inclusive of transactions executed but not settled, by the Company under this program.
Year Ended December 31, Total Number of Shares Repurchased Amount of Shares Repurchased
2 unchanged sentences
2,501,900 $ 54.6
−Removed: 2019 175,275 $ 4.9
−Removed: The table below presents dividends declared by Terex’s Board of Directors and paid to the Company’s shareholders in each quarter of 2021, 2020 and 2019:
+Added: The table below presents dividends declared by Terex’s Board of Directors and paid to the Company’s shareholders:
Year First Quarter Second Quarter Third Quarter Fourth Quarter
2 unchanged sentences
$ 0.12 $ — $ — $ —
−Removed: In February 2022, Terex’s Board of Directors declared a dividend of $ 0.13 per share which will be paid to the Company’s shareholders on March 21, 2022.
+Added: In February 2023, Terex’s Board of Directors declared a dividend of $ 0.15 per share, which will be paid on March 20, 2023 to the Company’s shareholders of record as of March 9, 2023.
NOTE N – LITIGATION AND CONTINGENCIES
−Removed: 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.
+Added: The Company is involved in various legal proceedings, including product liability, general liability, workers’ compensation liability, employment, commercial, intellectual property and tax litigation, which have arisen in the normal course of operations.
The Company is insured for product liability, general liability, workers’ compensation, employer’s liability, property damage and other insurable risks required by law or contract, with retained liability or deductibles.
11 unchanged sentences
TLA challenged the claim of Sao Paulo and learned in October 2019 that the Sao Paulo claim has survived the administrative tribunal process.
−Removed: TLA anticipates that it will receive notice for an amount due from Sao Paulo and expects to protest the Sao Paulo claim in litigation.
While the Company believes the position of the state of Sao Paulo is without merit and continues to vigorously oppose it, no assurance can be given as to the final resolution of the ICMS litigation or that TLA will not ultimately be required to pay ICMS and interest to the state of Sao Paulo.
39 unchanged sentences
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.