TEREX CORPORATION EMPLOYEE STOCK PURCHASE PLAN
As Amended and Restated Effective May 25, 2004
TEREX CORPORATION EMPLOYEE STOCK PURCHASE PLAN
Table of Contents
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Page
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Section 1. PURPOSE........................................................1
Section 2. TERM OF THE PLAN...............................................1
Section 3. ELIGIBLE EMPLOYEES.............................................1
Section 4. PARTICIPATION..................................................1
Section 5. HOLDING PERIOD.................................................4
Section 6. COMPANY CONTRIBUTIONS/DISCOUNTS................................4
Section 7. PARTICIPANTS' ACCOUNTS.........................................4
Section 8. PURCHASE OF THE COMPANY'S COMMON STOCK.........................5
Section 9. DIVIDENDS......................................................7
Section 10. CHANGES IN SHARES OF THE COMPANY'S COMMON STOCK...............7
Section 11. EQUAL RIGHTS AND PRIVILEGES...................................8
Section 12. LIMITATIONS ON TRANSFER.......................................8
Section 13. ADMINISTRATION OF THE PLAN....................................8
Section 14. EXPENSES......................................................8
Section 15. DESIGNATION OF CUSTODIAN......................................9
Section 16. PURCHASE OF SHARES FOLLOWING TERMINATION OF PARTICIPATION.....9
Section 17. AMENDMENT OR TERMINATION OF PLAN.............................10
Section 18. RESPONSIBILITY...............................................11
Section 19. DEFINITIONS..................................................11
Account................................................................11
Administrative Committee...............................................11
Base Pay...............................................................11
Board..................................................................11
Company................................................................11
Custodian..............................................................12
Eligible Employee......................................................12
Outside Director.......................................................12
Participants...........................................................12
Plan...................................................................12
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TEREX CORPORATION EMPLOYEE STOCK PURCHASE PLAN
Section 1. PURPOSE
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The purpose of the Terex Corporation Employee Stock Purchase Plan
(the "Plan") is to provide Eligible Employees and Outside Directors (the
"Participants") of Terex Corporation (the "Company") a means to purchase shares
of the common stock of the Company on favorable terms, based upon a
determination by the Administrative Committee that ownership by Participants of
the Company's common stock will provide them with investment opportunities and
increase their interest in the welfare of the Company. Participants may purchase
the Company's common stock under the Plan using the payroll-deducted investments
method described in Section 4A or the strategic-timed investments method
described in Section 4B.
Section 2. TERM OF THE PLAN
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The Plan became effective August 1, 1994. The Plan will terminate
on March 10, 2014.
Section 3. ELIGIBLE EMPLOYEES
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All Eligible Employees of the Company, as defined in Section 19,
may participate in the Plan. All Outside Directors are also eligible to
participate in the Plan.
Section 4. PARTICIPATION
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A. Payroll-Deducted Investments.
1. Automatic payroll deductions. Subject to the limitations of
subsection 2 below, any Eligible Employee may begin to make payroll-deducted
investments in the Company's common stock through automatic payroll deductions
if he or she enrolls in the Plan and completes a payroll deduction election. Any
enrollment or payroll deduction election (or payroll deduction election change)
must be completed online through the Custodian's website, or by phone through
the Custodian's customer service department.
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2. Pay periods to which payroll deduction election, change, or
revocation applies. The completion, change or revocation of any payroll
deduction election (under subsections 1, 6, or 7, respectively) shall apply to
each pay period that begins at least two weeks after the date the election is
completed, changed, or revoked but, if it is not administratively possible for
the payroll deduction election, change or revocation to apply on that date, the
election, change, or revocation shall apply as soon as administratively possible
thereafter. A payroll deduction election shall remain in effect until it is
either changed or revoked.
3. Deduction of whole dollar amounts only. Any payroll
deduction election that an Eligible Employee completes, under subsection 1
above, shall specify the whole dollar amount that will be deducted from his or
her Base Pay each pay period and deposited into his or her Account under the
Plan.
4. Minimum dollar amount of payroll deductions per pay period.
The minimum dollar amount that an Eligible Employee may contribute, by payroll
deduction, to his or her Account under the Plan for each pay period shall be the
amount that the Company specifies, in its sole discretion, from time to time
during the term of the Plan.
5. Maximum dollar amount of Participant contributions per
calendar year. The maximum total dollar amount that an Eligible Employee may
contribute to his or her Account under the Plan for any calendar year through
automatic payroll deductions shall be the amount that the Company specifies, in
its sole discretion, from time to time during the term of the Plan.
6. Change of payroll deduction election. Any Eligible Employee
who has elected, under subsection 1 above, to make payroll deduction
contributions to his or her Account under the Plan may change the rate of his or
her payroll deduction contributions (subject to the limitations in subsections 2
through 5 above) at any time during the calendar year by completing a new
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payroll deduction election. The change shall remain in effect until it is either
further changed (pursuant to this subsection) or revoked, under subsection 7
below.
7. Revocation of payroll deduction election. Any Eligible
Employee who has elected, under subsection 1 above, to make payroll deduction
contributions to his or her Account under the Plan may revoke his or her payroll
deduction election at any time during the calendar year (subject to the
limitations of subsection 2). Any Eligible Employee who revokes his or her
payroll deduction election, under this subsection 7, may enter into a new
payroll deduction election at any subsequent time, in accordance with
subsections 1 and 2 above.
8. Suspension of payroll deductions if Base Pay for any pay
period is insufficient. If an Eligible Employee's Base Pay for any pay period to
which a payroll deduction election applies is less than his or her payroll
deduction amount for that period, the deduction for that period will not be
taken, and, if necessary, deduction(s) for any future pay period(s) to which
such payroll deduction election would otherwise apply will be suspended until
the first pay period for which the Eligible Employee's Base Pay equals or
exceeds the payroll deduction amount he or she had elected.
B. Strategic-Timed Investments. Any Participant may make
strategic-timed investments in the Company's common stock under the Plan, either
in addition to or in lieu of any payroll-deducted investments he or she makes in
such stock under subsection A above. An Eligible Employee or Outside Director
may make strategic-timed investments at any time during the calendar year in at
least the minimum dollar amount that the Company specifies, in its sole
discretion, from time to time during the term of the Plan, by purchasing shares
of the Company's common stock through the Custodian designated by the Company.
Shares of the Company's common stock that a Participant purchases through
strategic-timed investments, pursuant to this subsection B, as well as any such
shares that he or she purchases through payroll deduction contributions, under
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subsection A above, shall be credited to his or her Account under the Plan in
the manner described in Section 7 below.
Section 5. HOLDING PERIOD
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If any share purchased by a Participant is not held for a
period of at least six (6) months before it is sold, the Participant's ability
to make payroll deduction contributions under subsection A above will be
suspended for a period of three (3) months. No Company contributions or cash
discounts described in Section 6 below will be made for such Participant during
this three-month suspension period. In addition, the Company will not reimburse
any brokerage account fees related to a strategic-timed investment under the
Plan by the Participant during this suspension period.
Section 6. COMPANY CONTRIBUTIONS/DISCOUNTS
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The Company may, in its sole discretion, make Company
contributions or cash discounts to the Accounts of Participants who contribute
to their Accounts under Section 4A or 4B above, or it may pay a cash discount
directly to such Participants. The Company shall determine, in its sole
discretion, the amount of any such Company contribution or discount. Any
contribution that the Company makes to the Account of any such Participant shall
be credited to his or her Account under Section 7A below and shall be applied to
the purchase of shares of the Company's common stock under Section 8 below, and
any cash discount shall be paid directly to the Participant.
Section 7. PARTICIPANTS' ACCOUNTS
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A. Establishment of Account. An Account will be established for
each Participant who makes contributions under Section 4A or 4B above. The
Participant's Account will be credited with (1) the contributions he or she
makes under Section 4A or 4B above, (2) any contributions that the Company makes
on his or her behalf under Section 6 above, and (3) the shares of the Company's
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common stock that are purchased with his or her and the Company's contributions
under Section 8 below. No interest shall be credited to the contributions that
are held in any such Account for the period of time between the date they are
credited to the Account and the date they are applied to the purchase of such
shares.
B. Account Statements. Each Participant who makes contributions
under the Plan will receive periodic Account statements from the Custodian in
such form as may be agreed upon by the Company and the Custodian; provided,
however, that the Custodian shall furnish an Account statement to each such
Participant no less frequently than semi-annually.
Section 8. PURCHASE OF THE COMPANY'S COMMON STOCK
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A. Time of purchase.
1. Under the Payroll-Deducted Investments Method. Any
contribution that a Participant makes to his or her Account under the
payroll-deducted investments method for a payroll period dated between the first
and fifteenth day of a calendar month, plus any contribution that the Company
makes with respect to the Participant's contribution for that period under
Section 6 above, shall be applied to the purchase of shares of the Company's
common stock on the business day that is closest to the last day of that month
or as soon as administratively possible thereafter. Any Participant contribution
(and any accompanying Company contribution) that is made for a payroll period
dated between the sixteenth and last day of a calendar month shall be applied to
the purchase of shares of Company stock on the business day that is closest to
the fifteenth day of the following month or as soon as administratively possible
thereafter.
2. Strategic-Timed Investments Method. Any strategic-timed
investment that a Participant makes shall be applied to the purchase of shares
of the Company's common stock in accordance with rules set forth by the
Custodian. Company contributions with respect to strategic-timed investments
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shall be made as soon as administratively possible following the Company's
receipt from the Participant of proof that the strategic-timed investment was
made; provided, however, that the Company contribution will not be made any
earlier than the last day of the payroll period which includes the day on which
the Company receives proof that the strategic-timed investment was made.
B. Purchase Price of the Company's Common Stock. The purchase
price that shall be paid, under subsection A above, for each share of the
Company's common stock that is purchased under this Plan on behalf of any
Participant shall be the price per share actually paid for the shares on the New
York Stock Exchange. The Company may also satisfy its obligations under the Plan
through the issuance of additional shares of Company common stock.
C. Stock Credited to Participant's Account. The shares of the
Company's common stock that are purchased under subsection A above on behalf of
any Participant shall be credited to his or her Account under the Plan as soon
as administratively possible after the date the shares have been purchased. As
soon as such shares have been credited to the Participant's Account, he or she
shall have all of the rights and privileges afforded to any other holder of the
Company's common stock.
D. Issuance of Stock Certificates. A stock certificate will not be
issued automatically to a Participant after shares of the Company's common stock
have been credited to his or her Account under subsection C above. However, the
Participant may ask the Custodian to issue a stock certificate representing any
or all of the shares then credited to his or her Account. Any such request must
be directed to the Custodian or its agent(s). The Custodian or its agent(s)
shall issue a stock certificate to the Participant promptly after it receives
his or her request.
Any such stock certificate shall be issued to the Participant in
his or her own name; provided, however, that if the Participant is married, the
stock certificate may be issued jointly to the Participant and his or her
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spouse, either as joint tenants with the right of survivorship or as tenants in
common, as the Participant may elect.
If the Participant has not secured a stock certificate from the
Custodian and the Participant wishes to sell any shares of the Company's common
stock from his or her Account through the Custodian or its agent(s), he or she
will not be required to secure a stock certificate from the Custodian for the
sale to be executed. However, if the sale is to be executed by person(s) other
than the Custodian or its agent(s), or if the Participant has already secured a
stock certificate from the Custodian for shares of the Company's common stock,
then the Participant must produce the stock certificate for the sale of those
shares to be executed.
Section 9. DIVIDENDS
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Dividends that the Company declares on shares of its common stock
will be credited to each Participant's Account in proportion to the number of
whole and fractional shares of such stock that are credited to the Participant's
Account on the record date for the payment of such dividends. If the Participant
elects to reinvest the dividends in shares of Company stock, the Custodian shall
reinvest such dividends as soon as administratively possible after the Custodian
receives the election at the price per share then prevailing on the New York
Stock Exchange.
Section 10. CHANGES IN SHARES OF THE COMPANY'S COMMON STOCK
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If the shares of the Company's common stock are subdivided or
combined or if the Company declares a stock dividend, the maximum number of
shares of the Company's common stock which may thereafter be purchased under the
Plan will be proportionately increased or decreased, as the case may be, the
terms relating to the price at which such shares may be purchased and the amount
of contributions necessary to purchase them will be adjusted appropriately, and
such other action(s) will be taken as the Administrative Committee determines to
be necessary or appropriate under the circumstances.
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Section 11. EQUAL RIGHTS AND PRIVILEGES
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All Participants who have purchased shares of the Company's
common stock under this Plan shall have the same rights and privileges as any
other holder of such shares.
Section 12. LIMITATIONS ON TRANSFER
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The right granted to any Participant under this Plan to purchase
shares of the Company's common stock is not transferable by such individual
other than by will or the laws of descent and distribution, and during the
Participant's lifetime, the right to purchase shares of the Company's common
stock under this Plan shall be exercisable only by him or her.
Section 13. ADMINISTRATION OF THE PLAN
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This Plan shall be administered by the Administrative Committee,
which shall consist of at least three (3) persons from time to time appointed by
the Board and serving at the pleasure of the Board. Any vacancies on the
Administrative Committee, whether caused by death, resignation, removal or other
reason, shall be promptly filled by the Board, but shall not affect the
Administrative Committee's authority to act hereunder pending such Board action.
The Administrative Committee may appoint such agent(s) as it deems necessary or
appropriate to assist it with the operation and administration of the Plan.
Section 14. EXPENSES
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The Company shall pay all of the Custodian's fees, and all of
the administrative costs associated with a Participant's payroll-deducted
investment. With respect to a Participant's strategic-timed investment, the
Company may reimburse the Participant's Account for a portion of the brokerage
expenses incurred in connection with the broker-dealer's purchase (but not the
sale) of shares of the Company's common stock, but only if the Participant
provides the Company with evidence of the strategic-timed investment. The amount
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of the reimbursement, if any, shall be determined pursuant to such guidelines as
the Company may establish from time to time.
Section 15. DESIGNATION OF CUSTODIAN
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Subject to its right to terminate the designation at any time,
the Company has designated the Custodian as the custodian, recordkeeper and
transfer agent for purposes of this Plan. The Company shall also designate the
broker-dealer selected for administration of the strategic-timed investments,
under Section 4B above. The terms and conditions of the parties' relationship
for this purpose shall be set forth in a separate written agreement between
them.
Section 16. PURCHASE OF SHARES FOLLOWING TERMINATION OF PARTICIPATION
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If a Participant terminates his or her participation under this
Plan, either by ceasing to make contributions to his or her Account under the
Plan, under Section 4 above, or by terminating his employment or service as an
Outside Director, as applicable, with the Company for any reason (including
death), or resigning as a member of the Board of Directors for any reason
(including death), then any contributions that are held in his or her Account as
of the effective date of such termination of participation will be applied to
the purchase of shares of the Company's common stock. If the termination of
participation occurs between the first and fifteenth day of a calendar month,
then the remaining contributions in the Participant's Account will be applied to
the purchase of shares of the Company's common stock on the business day that is
closest to the last day of that month or as soon as administratively possible
thereafter. If the termination of participation occurs between the sixteenth and
the last day of a calendar month, the remaining contributions in the
Participant's Account shall be applied to the purchase of shares of Company
stock on the business day that is closest to the fifteenth day of the following
month or as soon as administratively possible thereafter.
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Section 17. AMENDMENT OR TERMINATION OF PLAN
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A. Amendment. The Company reserves the power at any time to
amend this Plan through action of its Board; provided, however, that the Company
shall not have the power to amend the Plan in any manner that would increase the
duties or liabilities of the Custodian or affect its fees for services required
under the Plan unless the Custodian consents thereto in writing and provided,
further, that any amendment is subject to any requirement for stockholder
approval imposed by applicable law or any rule of any stock exchange or
quotation system on which Terex common stock is listed and quoted.
B. Termination. This Plan shall continue in effect until it
terminates pursuant to Section 2 above.
C. Additional Purchases of Shares and Issuance of Stock
Certificates Upon Plan Termination. If the Plan is terminated for any reason,
then:
1. a. if the Plan is terminated between the first and
fifteenth day of a calendar month, any contributions that are held in any
Participant's Account as of the effective date of the Plan's termination will be
applied to the purchase of shares of the Company's common stock on or before the
business day that is closest to the last day of that month or as soon as
administratively possible thereafter; and
b. if the Plan is terminated between the fifteenth and
last day of a calendar month, any
contributions that are held in any Participant's Account as of the effective
date of the Plan's termination will be applied to the purchase of shares of the
Company's common stock on or before the business day that is closest to the
fifteenth day of the following month, or as soon as administratively possible
thereafter; and
2. the Participant shall have exclusive authority over his
Account free of the rights and restrictions of this Plan.
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Section 18. RESPONSIBILITY
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Neither the Company, any member of the Board or Administrative
Committee, the Custodian nor any broker through whom purchases or sales of stock
are executed pursuant to this Plan shall have any responsibility or liability
other than liabilities arising under applicable federal or state securities laws
for any act or omission to act, including, without limitation, any action taken
with respect to the price, time, quantity, or other terms and conditions of the
purchase of shares of the Company's common stock under the Plan. The
Administrative Committee's determination as to any issue that may arise
regarding the conduct or operation of the Plan shall be final.
Section 19. DEFINITIONS
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A. "Account" means the account established by the Company under
Section 7A of the Plan on behalf of each Participant who makes
contributions under Section 4.
B. "Administrative Committee" means the Administrative Committee
appointed by the Board to administer the Plan in accordance with
Section 13.
C. "Base Pay" means, with respect to each Eligible Employee and
for each pay period, his or her regular compensation (including
commissions) earned from the Company during such period, before
any deductions or withholding of income or employment taxes and
exclusive of (1) overtime pay, (2) bonuses, (3) expense
reimbursements and (4) any other additional compensation.
D. "Board" means the Board of Directors of the Company, as
constituted from time to time.
E. "Company" means Terex Corporation, a Delaware corporation,
and any successor to all or a major portion of its assets or
business which assumes the Company's obligations under
this Plan.
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F. "Custodian" means the entity serving as custodian of the Plan
on December 31, 2003, or such other bank, trust company, or
other financial institution, appointed by the Administrative
Committee under Section 15, that is qualified, under applicable
federal and state laws, including federal and state securities
laws, to serve as the custodian, recordkeeper, and transfer
agent of shares of the Company's common stock under this Plan.
G. "Eligible Employee" means any individual who is actively
employed by the Company, but excluding any employee of the
Company (1) who is included in a collective bargaining unit
unless the relevant collective bargaining agreement with that
unit specifically provides that such unit's members shall be
covered by the Plan, (2) who is a leased employee [as defined in
Internal Revenue Code Section 414(n)(2)], or (3) whose
employment has been classified as temporary by the Company. Any
individual whom the Company determines is not an Eligible
Employee shall not be treated as an Eligible Employee under the
Plan solely because he or she has been classified or
reclassified by any governmental entity as an employee of the
Company.
H. "Outside Director" means any individual who is actively
serving as a member of the Board of Directors of the Company who
is not also an employee of the Company.
I. "Participants" shall mean Eligible Employees and Outside
Directors.
J. "Plan" means the Terex Corporation Employee Stock
Purchase Plan, as set forth in this instrument and any
amendments or supplements hereto.
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