IN THE UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

MICHAEL GLASSMAN, Trustee on behalf of CASE NO.the Kathleen & Michael Glassman. Family Trust,individually and on behalf of itself and all othersSimilarly Situated, CLASS ACTION COMPLAINT FOR

VIOLATIONS OF THE FEDERALPlaintiff, SECURITIES LAWS

v.(Jury Trial Demanded)

TEREX CORPORATION, RONALD M.DEFEO, PHILLIP C. WIDMAN and THOMAS

RIORDAN,

Defendants,

Pia:lilt-1f, Michael Glassman, Trustee on behalf of the Kathleen & Michael Glassman Emily

Trust (the "plaintifr), individually and on behalf of all other persons and entities similarly situated,

by its undersigned attorneys, alleges the following upon personal knowledge as to itself and its own

acts, and information and belief as to all other matters, based -upon, inler alia, the investigation

conducted by and through its attorneys, which included, amon g other things, a review of the public

statements made by the defendants, documents filed with the Securities and Exchange Commission

("SEC"), press releases and news articles regarding defendant Tern. Corporation ("Terex" or the

"Company") and a review of other 'publicly available information. Plaintiff believes that substantial

evidentiary support will exist for the allegations set forth herein after a reasonable opportunity for

discovery.

PRELIMINARY STATEMENT

1, This is a class action brought by plaintiff on behalf of itself and all others who

purchased or otherwise acquired securities of Terex during the period from February 20, 2008

•through February 11, 2009, inclusive (the "Class Period") to recover dama ges caused by

defendants violations of the federal securities laws.

2. Defendants made a series of materially false and misleading statements concerning

Terex's overall financial strength, business operations, and business prospects. Defendants'

misleading statements and omissions of material facts had the effect of ass-wing analysts and

investors that Terex's business operations were performing well, that Terex's financial condition

and future revenue stream was sound, and that its projected financial performance had a sound

basis.

3. Prior to the disclosures of the true facts concerning Terex's true financial condition

and during the Class Period, certain Company insiders sold approximately $9 ninon worth of their

personally held Terex stock.

4. On September 4, 2.008, Terex disclosed its updated Fiscal Year ("FY") 2008

financial guidance which lowered earnings per share guidance from a range of $6.85 - 87,15 to a

range of $6.35 - $6.65. Terex also disclosed adverse news concerning certain of the Company's

segments' weakening financial performances includim.:1 its Aerial Work Platforms and Construction

segments. These negative disclosures were followed by a Terex stock clec,line of 2071, or $9,30 a

share, on September 4, 2008 on unusually heaving trading value.

5. On February 11, 2009 Terex announced its Q4 2008 and FY 2008 results which

included goodwill impairment charges that reduced net income by a dramatic 84.60 a share for FY

2008. Following news of the Company's poor financial results and forecast, Terex stock fell $4.17

a share to close at 89,45 a share on February 12, 2009.

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6. Statements issued by the defendants during the Class Period were materially 'false

• and misleading because 'they failed to disclose and misrepresented the following material adverse

facts, including that: (a) Terex failed to properly and timely account for certain impaired assets

within the Company including in its "Construction" and "Roadbuilding, Utility Products and Other"

segments/units; (b) Terex was experiencing declining demand for its products in its Construction,

Materials Proeessing and Aerial Work Platforms segments; (c) that Terex's financials were much

weaker than represented; (d) Terex was not as prepared and diversified as represented to withstand

its significant exposure to a weakening global credit market and economy; and (e) the defendants

lacked a rca.sonable basis for positive statements and representations concerning Terex's FY 2008

earnings guidance and the Company's overall business .prospects.

JURISDICTION AND laNITE

7. The claims alleged herein arise under Sections 10(b) and 20(a) of the Securities

Exchange .Act of 1934 (the "Exchange Act"), 15 U.S.C. §§ 78J(b) and 78t(a), and Rule 100-5, 17

§ 240.10b-5 promulgated thereunder.

8. This Court has jurisdiction over the subject matter of this action pursuant to Section

27 of the Exchange Act, 15 U.S.C. §78aa and 28 U.S.C. § 1331.

9. Venue is proper in this District pursuant to Section 27 of the Exchange Act and 28

§1391(h). Terex is headquartered in this District and many of the acts and transactions

alleged. herein occurred in substantial part in this District,

10. In connection with the acts, transactions and conduct alleged herein, defendants,

directly and indirectly, used the means and instrumentalities of interstate commerce, including the

United States mails, interstate telephone communications and the facilities of the national securities

exchanges.

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TOE PARTIES

11. Plaintiff' purchased Terex securities during the Class Period, as evidenced by the

attached certification, and has suffered damages.

12. Terex is a Delaware corporation whose principal executive offices are located at 200

Nyala Farm Road, Westport, Connecticut 06880. Terex's common stock is publicly traded on the

New York. Stock Exchange (the "NYSE") under the symbol "TEX,"

13. During ail relevant tin-ies, defendant Ronald M. 'DeFeo ("DeFeo") was Terex's Chief

Executive Officer and the Executive Chairman of the Board of Directors of Terex (the "Board").

14. During all relevant times, defendant Phillip C. Widman ("Widman") was Terex's

Chief Financial Officer and Senior Vice President.

15. During all relevant times, defendant Thomas J. Riordan ("Riordan") was Terex's

Chief Operating Officer and President.

16. -Defendants DeFeo, Widman & Riordan are collectively referred herein as the

"individual Defendants."

SUBSTANTIVE ALLEGATIONS

17. Terex operates as a diversified global manufacturer of equipment for use in various

industries, including the construction, infrastructure, quarrying, surface mining, shipping,

transportation, refining, and utility industries.

18. Terex operates in five reportable segments: Terex Aerial Work Platforms, Terex

Construction, Terex Cranes, Terex Materials Processing & Mining, and Terex ftoa.d.building, Utility

Products and Other..

19. Terex's Aerial - Work Platforms segment offers material lifts, portable aerial work

platforms, .trailer-mounted articulating booms, self-propelled articulating and telescopic booms,

scissor lifts, telehandlers, Construction trailers, trailer-mounted light towers, power buggies, portable

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generators, and related components and replacement parts, Terex's Consiniction segment provides

heavy construction equipment, including off-highway trucks, scrapers, hydraulic excavators, large

wheel loaders ; and material handlers; and compact construction equipment, including. loader

backhoes, truck-mounted articulated hydraulic cranes, compaction equipment, ntini and midi

excavators, site dumpers, coinpact track loaders, skid steer loaders, and wheel loaders,

20. Terex's Cranes' segment offers mobile telescopic cranes, tower cranes, lattice boom

crawler cranes, truck-mounted cranes and telescopic container stackers, as well as replacement parts

and components. Terex's Materials Processing & Mining segment provides materials processing

equipment, hydraulic mining excavators, highwall mining equipment, high capacity surface mining

trucks, drilling equipment, and related components and replacement parts,

21. Terex's Roadbuilding, Utility Products and Other segment designs, manufacturers

and markets asphalt and concrete equipment,

22. The Company sells its products through dealers and distributors and leases or rents

equipment to third parties.

,4 . On February 20, 2008, Terex announced, via press release, its financial results for

the fourth quarter of 2007 ending December 31, 2007 ("Q4 2007") and the full year ending

December 31, 2007 ("FY 2007"). For the Q4 2007, TereX reported net income of $174 million or

$1.67 a share, representing a dramatic increase over the fourth quarter of 2006 net income of $100.9

million or 97 cents a share. For FY 2007, Tetex reported income from continuing operations of

$613.9 million, or $5.85 a share, a dramatic increase over the fiscal year 2006 income from

continuing operations of $396,5 million or $3.85 a share,

24. Commenting on the Q4 2007 and FY 2007, DeFeo stated in relevant part:

For Terex, 2007 was a very strong year in terms of financialperformance, with our best sales quarter of the year coining in the .fourth quarter. This was a transfomiational year for our Company, as

i 5

it demonstrated that the changes made as part of the journey weembarked on a few years back are taking hold and working, Weachieved a fall year operating margin of 10.5% net sales grew 19.5%and income from continuing operations was up 55% when comparedwith 2006. These achievements place us well ahead of the pace wecommunicated a year earlier in conjunction with our medium terrnfinancial goals, and yet the operating margin improvement is stillbelow the potential that we think exists in the Company. We achievedthese goals while continuing to have certain product lines of theCompany face challenging market conditions in their particular niche.We have benefited from strong global markets, as well as a relativelysmall exposure to the U.S. housing market; in fact non-U.S, net salesrepresented 70% of our total net sales for the full year 2007.

25. Regarding Terex's initiatives, Del-7 e° stated in relevant part:

We continue to build a better and stronger operating com.pany whilekeeping honed the skills of a targeted acquirer of assets. The supplychain and component shortages we are facing continue, but we aremaking steady progress. We continue to invest in improvementprojects at an aggressive rate, such as marketing knowledge, sales andservice changes, information technology, new product planningprocesses and the .Terex. Business System. While these initiatives maynot produce immediate benefits, they collectively comprise, thecornerstone of our future successes as we build a great company. In

. 2008, we will build start-up factories in India. and China, andpotentially other developing markets. In 2007 we successfullyacquired Superior Highwall Miners, and expect to close theacquisition of A.S.V., Inc. in the near future. Combined, thesefacilities and recent acquisitions will provide targeted growthplatforms. In 2007, we had a growth rate for net sales ofapproximately 13% excluding the translation effect of foreigncurrency exchange rate changes. And while our ROIC level of 43,3%for the year was outstanding, we think this result must be balancedagainst continued growth to achieve the appropriate mix of growthand returns,

26. Concerning Terex's 2008 outlook, DeFeo stated in relevant part:

Included hi this release is our initial outlook for the 2008 lisea.1 year.Reflecting on where we are today with respect to our objective of 812billion in sales and a 12% operating margin by 2010, we feel we areahead of our original timeline. And while news headlines continue tobroadcast sio,,ving economic conditions in North America andWestern Euro pe, we remain optimistic about prospects for ourbusinesses in both of these markets and continue to see very healthy

indicators for continued economic expansion from the developingmarkets, notably in Asia, Eastern Europe and the Middle East.

Concerning Terex's backlog, the Q4 2007 and FY 2007 press release noted, in

relevant part:

. Backl_g_g: Ba.cklo g, for orders deliverable during the next twelvemonths was $4,180.9 million at December 31, 2007, an inerea.se ofapproximately 53% versus the fourth quarter of 2006. The increasewas mainly driven by the continued sharp increase in crane orders,which are outpacing the Company's ability to manufacture anddeliver products to its customers. Construction backlog more thandoubled over the prior year, in response to strong .European andMiddle Eastern demand. Materials Processing 8.: Mining segmentbacklog increased almost 75% over the prior year reflecting .globalinfcastructure requirements. The Aerial Work Platforms segmentbacklog was relatively flat overall versus the prior year period. Withregards to Terex .Roadbuilding, Utility Products and Other (RBUO)backlog, RBUO backlog at December 31, 2006 included TerexGovernment Programs of $38.4 million. Backlog of 852.8 million atDecember 31, 2007 relating to Terex Government Programs wasallocated to the respective manufacturing divisions to better reflect theproduct being sold rather than the distribution channel being utilized.

28. Concerning Terex's outlook for 2008 and global demand for the Company's

products, DeFeo stated in relevant part:

We are poised to have another record financial performance in 2008.We expect generally strong global markets to continue to drivedemand for our equipment. Add to that our expectation that we willhave the ability to produce at greater volumes and with improvedproductivity, and 2008 looks to be a significant step forward towardsour corporate 2010 objective. It is our expectation that Terex's totalrevenue for 2008 will be between $10.0 and $10.5 billion, andearnings per share in the range of 86.65 to $7.15 per share.Expectations are for earnings in the first and second half of 2008 to beapproximately equal. Additionally, we expect our first quarter resultsto be approximately 35% - 40% of our first half guidance.

The Q4 2007 ancl FY 2007 press release was followed by Tere,x's earnings

conference call which reiterated the defendants' positive representations concerning Terex's

business financial results, product demand, operations and future prospects.

30. On February 27, 2008, Terex filed its Annual Report on a Porin 10-K with the SEC

(the "2007 10K") which further reiterated the Company's previously announced Q4 2007 and FY

2007 results,

31, Regarding the Company's goodwill impairment of certain assets, the 2007 10K

stated, in relevant part:

impairment of Long Lived Assets - Our policy is to assess therealizability of our long-lived assets, including intangible assets, and toevaluate such assets for impairment whenever events or changes incircumstances indicate that the carrying amount of such assets (orgroup of assets) may not be :recoverable. Impairment is determined (0exist if the estimated future .undiscounted cash flows are less than theasset's carrying value. Future cash flow projections includeassump tions regarding future sales levels, the impact of cost reductionprograms, and the level of working capital needed to support eachbusiness. We rely on data developed by business segment managementas well as macroeconomic data in making these calculations. There areno assurances that 'future cash flow assumptions will be achieved. Theamount of any impairment then recognized would be calculated as thedifference between the estimated fair value and the carrying value ofthe asset.

* *

Goodwill. Goodwill, representing the difference between the totalpurchase price anci the fair value of assets (tangible and intangible) andliabilities at the date of acquisition, is reviewed for impairmentannually, and more frequently as circumstances warrant, and writtendown only in the period in which the recorded value of such assetsexceed their fair value. The Company does not amortize goodwill, inaccordance with Financial Accounting Standards Board (the "FASB")Statement of Financial Accounting Standards ("SFAS") No 142"Goodwill and Other Intangible Assets," The Company selectedOctober 1 as the date for the required annual impairment test, Therewere no indicators of goodwill impairment in either of the testsperformed as of October 1, 2007 and 2006. The impairment testperformed as of October 1, 2005 identified indicators of goodwill

inapairment in the Roadbuilding, Utility Products and Other segmentthat. resulted in a pre-tax impairment charge of $.3.3. See Note L —"Goodwill."

The initial recognition of goodwill, as well as the annual review of thecarrying value of goodwill, requires that the Company developestimates of future business performance. These estimates are used toderive expected cash flow and include assumptions regarding futuresales levels, the impact of cost reduction programs, and the level ofworking capital needed to support a given business. The Companyrelies on data developed by business segment mana.gement as well asmacroeconomic data in making these calculations. The estimate alsoincludes a determination of the Company's weighted average cost ofcapital. The cost of capital is based on assumptions about interest ratesas well as a risk-adjusted rate of return required by the Company'sequity investors. Changes in these estimates c,an impact the presentvalue of the expected cash flow that is used in determining the fairvalue of acquired intangible assets as well as the overall expectedvalue of a given business.

* *

Impairment of Long-Lived Assets. The Company's policy is to assessthe realizability of its long-lived assets, including intangible assets,and to evaluate such assets for impairment whenever events or changesin circumstances indicate that the carrying amount of such assets (orgroup of assets) 1.II.ay not be recoverable. impairment is d.eteimined toexist if the estimated future undiscounted cash flows are less than thecarrying value. The amount of any impairment then recognized wouldbe calculated as the difference between estimated fair value and thecarrying value of the asset. The Company did not have anyimpairments in its long-lived assets for the years ended ,December 31,2007, 2006 and 2005.

32. Regarding the Company's overall financial condition, the 2007 10K stated, in

relevant part:

2007 was another year of solid performance for Terex, as wecontinued to benefit from global economic growth driving strong endmarket demand. We focused on numerous internal initiatives to growsales and profitability as we transform from a holding company to anintegrated operating company. We have also benefited irom globalgrowth driven by strong economies in North America and WesternEurope and improving standards of living around the world. Althoughwe expect slower economic growth in 2008 in North America, and to a

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lesser extent in Western Europe, our strategy of product andgeograolne diversity is expected to drive sales growth that will allowus to remain on pace to achieve our goal o1$12 billion in sales with a12% operating margin by 2010. Demand .for infrastructure and energyhas resulted in extraordinary demand for our cranes. Strongcommodity demand driven by developing economies has increaseddemand for our mining equipment. Increasing labor rates that require,productivity enhancing solutions combined with itnproving globalsafety standards is driving demand for our aerial work platformsproducts; Our construction products faced a mixed year in 2007, withweakness in North America partially offset by strength in othergeographies, particularly in Western Europe, for certain types cif heavyequipment, and in both Western and Eastern Europe for compactconstruction equipment. Our roadbuilding and utility businesses,which are primarily North American focused, remained weak, as aresult of continued low levels of governmental spending 00infrastructure.

A key to our continued strong performance is that our productportfolio contains a mix of early, mid and. late cycle productscombined with mining products that are tied to global commoditydemand. For example, compact construction equipment is an earlycycle product, aerial work platforms and heavy constructionequipment are mid-cycle equipment, and cranes and roadbuildingequipment arc late cycle equipment. This relatively balanced mix ofproduct types 'helps to moderate cyclical sates movements for Terexa whole, as demand for one product ma.y weaken, but be offset bydemand for products in a different cycle. A balanced geographic salesmix also helps moderate demand swings for our products, as demandin one region may strengthen or weaken over different times ascompared to economies in other geographies. 2007 eventsdemonstrated the value of geographic diversity, as constructionequipment sales slowed in North America but were strong in Europe.In 2007, 45% of our sales were to customers located in the USA,United Kingdom and Germany. To further our geographic. sales mix,we are intent on growing our presence in developing markets as wework towards our goal of generatin g approximately 1/3 of our salesfrom the Americas, 1/3 from Europe, Africa and the Middle East andthe remaining 1/3 from Asia and Australia.

Global dynamics expected to continue to drive demand for ourequipment include creating infrastructure in developing economies,repairing/replacing infrastructure in North America and WesternEurope„ increasing labor costs and stren gthening safety standard.sglobally. Developing economies are building infrastructure at a rapidpace, as demonstrated in countries and regions around the world such

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as the Middle East, and particularly Dubai, cities in Eastern Chinasuch as Shanghai and Beijing, and Easteni Europe. This growth isexpected to continue as profits from oil exports are invested byexporting countries such as Russia and thc Middle East and as westernChinese cities develop. Decaying infrastructure and historical underinvestment in infrastructure to support population growth are expectedto continue to drive demand for equipment in North America andWestern. Europe. This global infrastructure demand favorably impactsall five of our segments, particularly Cranes and Materials Processing& Mining, Aerial work platforms and compact construction equipmentsuch as mini excavators are benefiting from higher labor costs thatdrive demand for productivity enhancing solutions. Stricter safetystandards are also driving demand for equipment such as aerial workplatforms as countries recognize the inherent risks of working at heighton ladders and scaffolding,

33. On April 23, 2008, Terex announced, via press release, its financials results for the

tirst quarter of 2008 ending March 31, 2008 ("Q1 2008"). For Q1 2008, Tercx reported net income

of 8163,3 million or $1.59 a share representing a dramatic increase over the first quarter of 2007's

net income of $113.8 million or 81.09 a share.

34. Commenting on the Ql 2008 results and Terex's "solid prospects," DeFeo stated in

relevant part:

We are pleased with the first quarter's results, with both net sales andnet income growth posting solid double digit percentage increasesversus the prior year. The strength of international end markets andthe continued strength of the domestic U,S. 'in-the-air' productsyielded excellent results in our Aerial Work Platforms and Cranesbusiness segments. Continued demand irlDr commodities drovefavorable results for our Materials Processing 84. Mining businesssegment. The performance of the balance of our businesses, namelythe Construction, Roadbuilding and Utility operations, weresomewhat disappointing for the quarter. We believe, however, that. thenear term outlook is positive for the Construction segment, and thatits operating margin will improve in the mid-year period and lead togood margin expansion on a year-over-year basis in 2008. In general,we think that all of our operations continue to have solid prospectsheading into the remainder of the year.

Regarding Terex's business outlook and the Company implementing pricing actions

to recover lost margin, Riordan added in relevant part:

We rernain confident about our business outlook for the remainder of2008. Looking forward, we can see challenges in material costs,especially as we move into the second half of 2008, We intend toaddress these cost increases through pricing actions to recover lostmargin arising from nigher component costs. While we anticipate thatwe will be able to implement these pricing actions timely andeffeetively, we realize that there is a certain level of risk and exposurethat may materialize in the second half of the year.

36, Regarding Terex's future earnings potential, DeFe° added in relevant part:

In February, we provided earnings guidance for our 2008performance, indicating that we anticipated earnin gs per share to bebetween $6.65 and 87.15 and net sales to be between $10.0 and $10.5billion. Given our strong performance this quarter, balanced againstthe 'uncertainties surrounding some of our end markets and increasedinput costs, we now anticipate earnings per share for 2008 to betowards the middle to high end of our previously announced range, or86.85 to 87.15 per share, on net salts of 810.5 to 810.9 billion,

3 7. Regarding Tcrex's backlog, the Ql 2008 press release stated, in relevant part:

Ba.cklog: Backlog for orders del1verable during the next twelvemonths was 84,815,6 million at March 31, 2008, an increaseapproximately 41.1% versus the first quarter of 2007, and an increaseof 15.2% versus the December 31, 2007 level. The increase fromDecember 31, 2007 was reflected across all business segments. Theincrease versus the prior year's first quarter was aided substantially bythe continued strength of Crane orders, whic,h are outpacing theCompany's ability to manufacture and deliver products to itscustomers. Also meaningfully contributing to the increase was theConstruction business, as that segment's backlog increased 48% overthe prior year period, in response to stron g Eastern European andMiddle East demand, continued strong demand for material handlersin response to higher. steel prices, and continued ramp-up challengeson certain product lines. Materials Processing Mining segment'backlog increased 27% over the prior year period, .reflecting globalinfrastructure requirements. Backlog for the Aerial Work Platformssegment showed a modest improvement, while the Roadboilding,Utility Products and Other segment declined somewhat from the prioryear's first quarter. Further details are contained in the Glossary. Withregard to the reported backlog, it should he noted that Tcrex has not

12

accepted firm orders for rough terrain crane delivery to take placeafter January 1, 2009. This was designed to ensure that prices for2009 delivery sufficiently reflect the demand environment andpotential input cost increases of the business. Production volumes forthe first quarter of 2009 that have not been included in backlogapproximate $210 million. The Company does not anticipateestablishing pricing for rough terrain cranes for 2009 delivery untilthe third quarter of 2008.

38. Concerning Terex's Q1 2008 "Construction" and "Roadbuilding, 'Utility Products

and Other" segments, the Q1 2008 press release stated, in relevant part:

Construction: Net sales for the Construction segment for the firstquarter of 2008 increased $40.5 million, or 9.9%, to $448.3 millionversus the first quarter of 2007, Excluding the translation effect offoreign currency exchange rate changes of $29.8 million and ASVsales since its acquisition of • $21.3 million, net sales decreasedapproximately 2..6%, The U.S. market remained relatively weak andthe European market was moderately slower. This decline was mostlyoffset with positive developments in the Middle East and EasternEurope. Additionally, the larger construction-class off-highway truckbusiness in Motherwell, Scotland experienced a slow-down inproduction rates due to challenges that arose during the shift to amixed model production line. This shortfall is expected to betemporary, and the net result of this activity is still expected to yieldsignificant volume opportunity and cost reduction,

* *

Roadbuilding, Utility Products and Other: Net sales for theRoadbuilding, Utility Products and Other (RBUO) segment for thefirst quarter of 2008 decreased $9.6 Million, or 5.4%, to $169.2million versus the first quarter of 2007. This is directly related to thedecrease in concrete mixer truck demand resulting from continuedsoftness in the North American housing construction market.Additionally, the prior year's results reflected an unusual positiveeffect of the Tier III engine changeover which resulted in an elevatedlevel of customer demand ahead of the introduction of the higher cost,stricter emissions engine. Order quoting activity remains strong forboth the asphalt plant and utility product businesses and shipments areexpected to increase in the second quarter. The lower net sales-volume in the first quarter of 2008 had a negative impact on GrossMargin and operating margin, The Company will continue to monitorthe estimated fair value of the roadbuilding business for purposes of

• determining whether an impairment is evidenced.

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30, On April 23, 2008, Terex's common stock closed at 870.66 a share.

40. The Qi 2008 press release was followed by Terex's earnings conference call which

reiterated the defendants' positive representations concerning the Company's Qi 2008 financial

results, business, product demand, operations and future prospects.

41. On May 6, 2008, Terex filed its Quarterly Report for the Qi 2008 on a Form 10-Q

with the SEC ("Q1 2008 10Q") which reiterated the Company's previously announced Q1 2008

results.

42. Regarding Terex.'s impairment charges, the Q1 2008 10Q, stated, in relevant part:

As of March 31, 2008, the roadbuilding reporting unit within theRoadbuilding, Utility Products and Other segment did not meet theforecasted business performance used in the annual goodwillimpairment test as of October 1, 2007. The downturn in the U.S.residential housing market and limited funding for infrastructureprojects, has negatively impacted the businesses in which thisreporting unit operates.

The Company updated its forecast to address the impact of changes inbusiness conditions and performed a goodwill impairment test as ofMarch 31, 2008 for the roadhuilding reporting unit. The roadbuildingreporting unit passed the test and no impairment charge was recorded.The Company will continue to monitor the estimated fair value of theroadbuilding business for purposes of determining whether impairmentis evidenced, The amount of goodwill recorded for the roadbuildingreporting unit as of March 31, 2008 was $34.4 million.

43. Regarding the Company's overall financial condition, the Q1 2008 10Q, stated, in

relevant part:

At March 31, 2008, end markets remained favorable for most of ourproducts in the majority of the geographies in which we do business,We continued to execute on our internal margin expansion initiatives,resulting in another quarter of solid performance. We remainoptimistic about 2008 and our ability to generate strong financialresults. Our net sales expectations remain strong, as demonstrated byour growing backlog. Infrastructure and ener gy projects continue tcdrive demand . for our cranes. Growing needs for energy and

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commodities, particularly •tiiorn developing economies, are drivingorders for our mining equipment. Increasing labor rates that requireproductivity enhancing solutions, combined with improving globalsafety standards which recognize the inherent risks of working atheight on ladders and scaffolding. , are driving demand for our aerialwork platfolins products around the world. Deteriorating infrastructureand historical under-investment in infrastructure to support population,cniowth are expected to continue to drive demand for equipment inNorth America and Western Europe. This global infrastructuredemand favorably impacts all five of our segments, particularly Cranesand Materials Processing & Mining.

We remain confident that our strategy of product and geographicdiversity is the right one for the industries in which we operate. Ourrelatively balanced mix of product types helps to moderate cyclicalsales movements for Terex as a whole, as demand for one product mayweaken, but be offset by demand for products in a different cycle. Abalanced 'geographic sales mix also helps moderate dernand swings forour products, as demand in one region may strengthen or weaken overdifferent times as compared to economies in other geographies. Basedon discussions with our customers, industry experience and knowledgeof our internal improv • ement initiatives, we remain confident in ourability to obtain our 2010 targets of SI2 billion in revenue with a 12%operating margin. Our growing emphasis on developin g marketsshould help to offset the effects of any economic slowdown in maturemarkets. Certain developing markets are investing their oil wealth,such as Middle Eastern countries and Russia, or their substantialforeign currency reserves achieved from exporting, such as China, in awide array of infrastructure projects that will require many years tocomplete.

The first quarter of 2008 saw continued emphasis on growing ourfranchise through strategic acquisitions and addressing our capitalposition through share repurchases. 1In February 2008, we acquiredASV, a designer and manufacturer of rubber compact track loadersand undercarriages. The total consideration for the ASV transactionwas approximately $504 million. The acquisition of ASV iscompelling from both a global distribution and technology standpoint.ASV has leading edge technology that is patent protected and that canbe applied to other products manufactured by Terex. Historically, ASVhas sold primarily to dealers in the U.S and Canada. We plan to •distribute the compact track loaders globally and have already begunby selling a few units in Eastern Europe during the first quarter of2008. We continue to execute share repurchases under our sharerepurchase program. The total dollar amount that may be repurchasedunder the share repurchase program is $700 million through June 30,

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2009. As of March 31, 2008, we repurchased approximately 3.1million shares for approximately $21.8

The first quarter of the year typically reflects growth in -working,capital as we build inventory to prepare for the Nenhern Hemispheresurnmer selling, season. The first quarter of 2008 reflected similardynamics, although at a rate higher than we would have preferred.While most of the inventory accumulation is 'associated withanticipated continued strong growth, it also reflects logistic issuesarising from increased transportation times due to the globalization ofour customer base, as well as challenges with supplier partsavailability at certain locations. We are continuing to review ourglobal manufacturing footprint to better position production closer toour customers, and we aim to moderate this negative influence overthe next twelve to eighteen .months.

We are focused on a number of internal improvement initiatives toincrease sales and profitability, and to manage asset utilization as wecontinue our journey to becoming an .excellent operating company.Our emphasis on supply management is helping us to preserve marginsdespite rising commodity prices, such as the price of steel. We areaggressively managing this situation and expect that we will be able tooffset cost increases by increasing pricing commensurately.Implementation of the Terex Management System_ ("IMS"), ourenterprise resource-planning system, continues to progress with theinitial rollout scheduled for the second and third quarter of 2008 incertain sites in the U.S., the United Kingdom and Germany,representing the three primary geographies where we manufacture.TMS will provide greater visibility into costs, spending and assetutilization, providing valuable information for management tocontinue to improve the business,

44, On July 15, 2008, Terex announced via press release that the Board authorized the

Company repurchase of an additional 8500 million of Terex's outstanding common shares bringing

the total amount that may be repurchased to 81.2 billion, Commenting on the share repurchase

program and Terex's financial strength. DeFeo stated in relevant part:

This action represents the second step-up in our share repurchaseprogram since the program began. We continue to believe thatinvesting in our shares provides an attractive return. Terex has thefinancial strength today to expand the share repurchase programwithout affecting our ability to implement internal or externalinitiatives. We remain optimistic about meeting our long-termgoals, and are committed to enhancing shareholder value.

16

45. On news of the share repurchase program, Terex stock climbed $5.81 a share to

close at $48.47 a share on July 16, 2008,

46, On July 23, 2008, Terex announced its financial results for the second quarter of

2008 ending June 30, 2008 (the "Q2 2008"). For the Q2 2008, Terex reported net income of $236.3

million or 82.32 a share, a dramatic increase over the second quarter of 2007's net. income of 8174.6

million or S1.66 per share.

47. Commenting on Terex's "continued strength" and "strong demand" for Terex's

products, DeFe° stated, in relevant part:

Results this quarter demonstrate the continued strength of our globalfranchise. The infrastructure and commodity boom is driving strongdemand for our cranes and mining equipment. Based on ourincreasing backlog for these products, we expect these positive trendsto continue. Also, as expected, this was partially offset by slowergrowth trends in the Aerial Work. Platforms (AWP) segment andfurther softening in the Construction segment_ Though both AWP andConstruction experienced growth this past quarter, slower growth inWestern Europe impacted their performance.

Not surprisingly, input costs continue to present challenges for us. Tooffset this, we are implementing various price increases andmaintaining cost discipline. Vhile in total we expect higher pricingwill lar gely offset the cost •increases that we have already incurred, as

•well as additional cost increases that we expect to incur during thesecond half of 2008, we do expect that there will be a lag betweenwhen higher costs are incurred and price increases to our eitstomerstake effect. Accordingly, we anticipate some reduction in operatingmargin in our business during the remainder of 2008.

The power of our strategy of product and geographic diversity isillustrated in our results. We have been able to continue to grow netsales and income through an evolving sales mix. The Cranes andMaterials Processing & Mining (MPM) segments grew drarnaticallyduring the period. Geographically, we continue to see significantgrowth in developing markets in line with global infrastructuredevelopment. Over time, our percentage of sales to developingmarkets has steadily increased, with first half 2008 net sales in theseregions representing approximately 22% of our total sales.

17

Concerning Terex's previously announced earnings per share guidance range and the

Company's "divcirsitication," DeFeo stated, in relevant part:

We expect our performance for 2008 to he within our previouslyannounced range for earnings per share of $6.85 to $7.1.5 and netsales of $10.5 to $10.9 billion. We expect strong infrastructure andcommodity demand trends for our Cranes and MPM seg,mentscontinue, which will drive a higher portion of our net sales andincome for the balance of 2008,

* *

Our global and product diversification has ',dimmed the Company to.perfonn well despite the difficult economic conditions in the U.S.,softening of the markets in Western Europe and increasing inputcosts. Demand remains strong for rnany of our products, and we arecontinuing to invest in our business for today and tomorrow,particularly in developing markets such as China and India. Weexpect world demand for infrastructure, energy and mining . productsto continue, white at the same .tirne we are positioning our businessesfor the eventual recovery in the 'U.S. market. We remain confidentour ability to achieve our previously stated goal of '12 by 12 in 10,which is $12 billion in revenues with a 12% operating margin by2010. By quickly adapting to changing market conditions in all of oursegments and geographies, we are showing that we can provideproducts that meet our customers' needs worldwide, and at the sametime improve our financial performance and invest in growth for theCompany.

49. Regarding Terex's initiatives, Riordan stated, in relevant part:

We are progressing well with our key internal initiatives. We continueto invest in appropriate capacity expansion, focusing on up-cyclebusinesses such as cranes and mining equipment and developingmarkets, and at the same time we inc keenly focused on improvingexisting capacity and our cost structure to better meet changes indemand and customer needs. As appropriate, headcount and overheadlevels inc being adjusted globally in line with changes in productdemand and the Company's evolving global manufacturing footprint.Filially, we have successfully gone live with the implementation ofthe TereN Management System at three businesses in the U.S.,Germany and U.K. We believe that this new enterprise wide systemwill contribute to improved efficiency in our operations over the longterm, as we consolidate our information systems.

50. Regarding Terex's backlog, the Q2 2008 press release stated, in relevant part:

18

.13•7c/T?og for orders deliverable during the next twelvemonths•$4,224.8 million at June 30, 2008, an increase ofapproximately 11.2% versus the second quarter of 2007, and adecrease of 12.3% versus March 31, 2008.

With regard to the reported backlog, it should be noted that Terex hasnot accepted firm orders for a variety of crane types, primarily roughterrain cranes, which have scheduled delivery after January 1, 2009.This was designed to ensure that prices for 2009 delivery sufficientlyreflect the demand envirorunent and potential input cost increases ofthe business. Production volumes for 2009 that have not beenincluded in backlog approximate $484 million, based on eun:entpricing levels, The Company anticipates establishing pricing for .thesecranes in the third quarter of 2008.

AWP backlog decreased 46.8% as compared to June 30, 2007, anddecreased 40.2% as compared to March 31, 2008, due to softeningdemand, particularly in Western Europe.

Construction segment backlog decreased 2.6% versus the comparableprior year period and decreased 26.5% as compared to March 31,2008. Slowing compact constinetion demand in Western Europe,combined with the easing of some supplier constraints (which allowedfor increased production levels), contributed to the decreased backlog.

As compared to June 30, 2007 levels, Cranes segment .backlogincreased 45,5%, due primarily to strong global demand. Compared toMarch. 31, 2008 levels, Cranes backlog decreased 6.0%, due to craneorders received for 2009 delivery which are not included in thebacklog because they have yet to be priced (as noted above),

MPM backlog increased 24.4°6 versus June 30, 2007 and increased7.494 as compared to March 31, 2008, as global commodity marketstrength is driving higher dernand for mining equipment.

Roadbuilding, Utility Products and Other (RBUO) segment backlogdeclined 12.6% versus June 30, 2007 and declined 6,294 as comparedto March 31, 2008, as concrete mixer truck orders slowed.

51. Concerning Terex's "Construction" and "Roadbuilding, Utility Products and Other"

segments, the 2008 press release stated in relevant part:

Construction: Net sales fbr the Construction segment for the secondquarter of 2008 increased 23.694 to $620.9 million versus the secondquarter of 2007. Excluding the translation effect - of foreign currencyexchange rate changes of approximately $44 million and acquisition

19

related sales during the second quarter of 2008 of $58,5 million, netsales increased approximately 3% versus the prior year period.

Weakness in the U.S. construction Market continued during thesecond quarter of 2008, while compact construction equipment salesslowed in Western Europe. Demand remains solid for rigid framedump trucks as well as material handlers (a product used by scrapsteel yards), Additionally, demand trends in developing marketsremain favorable for Construction, particularly in the Middle East,Africa, and Eastern Europe.

Construction operating margin decreased to 2.8% for the secondquarter of 2008 from 4.7% for the comparable period in 2007. Risinginput costs pressured operating margin during the second quarter of2008. Additionally, investments in global sales and support structure,as well as initiatives in aftermarket services and engineering, continueto progress, and are expected to contribute to operating marginexpansion over the next two to three years.

*

Roadbuilding. Utility Products and Other: Net sales for the RBUOsegment for he second quarter of 2008 increased 13,3%, to $191.3million, versus the second quarter of 2007. Excluding the translationeffect of foreign currency exchange rate changes, net sales increasedapproximately 11%. The Utility Products, Roadbuilding andGovernment Prograins businesses all witnessed sales growth,although concrete mixer truck sales were essentially flat whencompared to the second quarter of 2007.

Trends in the Company's Utility Products business are positive.Roadbuilding net sales remained soft, as U.S. infrastructure spendingremains weak, resulting in the continued implementation of costcontainment strategies within this business. The Company willcontinue to monitor the estimated fair value of the Roadbuildingbusiness for purposes of determining whether a goodwill impairment

evidenced,

RBUO operating margin was 5.1% in the second quarter of 2008versus 2.4% for the comparable period in 2007. Increased volumecombined with cost containment, particularly manufacturingefficiencies recognized within the Utility Products business, resultedin improved operating margin for the entire segment.

20

52, The Q2 2008 press release was followed by Terex's earnings eonference call whiCh

reiterated the defendants' positive representations concerning the Company's Q2 2008 financial

results, business, product demand, operations and future prospects.

53. On August 1, 2008, Terex filed its quarterly report for the Q2 2008 on a Form 10-Q

with the SEC which reiterated the Company's previously announced Q2 2008 results.

54, Regarding Ten.-.x l s impairment charges, the 2Q 2008 . 10Q, stated, in relevant part:

As of June 30, 2008, the roadbuilding reporting unit within theR.oadbuilding, Utility Products and Other segment did not meet theforecasted business performance -used in the annual goodwillimpairment test as of October 1, 2007. The downturn in the U.S.residential housing market and limited funding for infrastructureprojects has negatively impacted the businesses in which thisreporting unit operates,

The Company updated its forecast to address the impact of changes inbusiness conditions and performed a goodwill impairment test as of

• June 30, 2008 for the roadbuilding reporting unit. The roadbuildingreporting unit passed the test and no impairment charge was recorded.The Company will continue to monitor the estimated fair value of theroadbuilding business for purposes of determining- whetherimpairment is evidenced. The amount of goodwill recorded for theroadb •uilding reporting unit as of JUT10 30, 2008 was $39.7 (million). •

55. Regarding the Company's overall -financial condition, the 2Q 2008 10Q, stated, in

relevant part:

Financial perfomance during the second quarter of 2008 was strongand the outlook for our Cranes and Material Processing & Miningsegments rernains favorable. Demand for cranes, Material processingand mining equipment is being driven by global infrastructuredevelopment and maintenance., rising energy demand and globalcommodity demand. Backlog for these businesses continues to grow.Select capital investment is being made to expand capacity for thesebusinesses in order to more effectively and efficiently respond tomarket demand. Capital investment is being made in existing •facilitiesin Germany for cranes and hydraulic mining excavators and newfacilities are being developed in India for material processingequipment and in China for cranes and hydraulic excavators.Additionally, the Aerial Work Platforms segment is expanding itsmanufacturing footprint to China to produce portable products,

21

scissors and booms to meet growing demand for these products in there g ion. Rising input costs, particularly steel prices, did not have amaterial impact during, the second quarter of 2008 for the Cranes orMaterial Processing (Xi. Mining businesses due to the presence ofsupply contracts, cost escalation clauses in select contracts with ourcustomers and previously iinple.mented pricin g actions. Higher inputcosts are a concern for the second half of 2008 across the Companybut the impact on these two businesses should generally be offset bypricing, actions. The Roadbuilding, Utility Products and Othersegment showed modest improvement over the prior year period butremains challenged with reduced U.S. infrastructure spending.

Tempering the strength of the Cranes and Materials Processing &Mining segments is the continued weakness in the U.S. market anddeveloping softness, primarily in Western Europe, for ourConstruction and Aerial Work Platforms businesses, along withincreasing pressure from rising input costs, particularly steel prices.Compact construction equipment demand has been weak in the U.S. •for a number of quarters and began to weaken in Western Europeduring the second quarter of 2008. Our expectations are that this

• weakness will continue in the U.S. and 'Western European markets forcompact construction equipment through at least early 2009, whichwill be partially offset by continued demand from developingmarkets. Offsetting the weakness in compact construction to someextent is continuing favorable demand for select heavy constructionproducts, including rigid frame dump trucks as well as materialhandlers, which are used predominantly by sLirap yards. Secondquarter 2008 sales performance of the Aerial Work Platforms segmentwas solid, but Slowin g, markets in Western Europe and rising steelprices are expected to negatively impact the financial performance ofthis business for the remainder of the year...Prieing actions are, beingtaken across the Company to offset rising steel costs, although we doexpect that there will be a lag to some extent in the tinning betweenwhen higher costs are incurred and price increases to our customerstake effect, particularly within the Construction and Aerial WorkPlatforms businesses, As appropriate, headcount and overhead levelsare being adjusted globally in line with changes in product demandand our evolving global manufacturing footprint.

We remain confident that our strategy of product and geographicdiversity is the right one for the industries in which we operate.. Ourrelatively balanced mix of product types helps to moderate cyclicalsales movements for Tetex as a whole, as demand for one productmay weaken, but be offset by demand for products in a differentcycle. A balanced geographic sales mix also helps moderate demandswings for our products, as demand in one region may strengthen or.weaken over different times as compared to demand in other

22

geoc,Taphies. For example, as the demand for Aerial Work Platformsproducts is expected to weaken during the second half of 2008 due toslowing demand and rising input costs, continued strength isforecasted from the Cranes and Materials .Processi.ng Miningsegments, which are expected to 'contribute to stability in earnings.The results of the second quarter of 2008 support this strategic thesis,as strong financial performance by the Cranes and MaterialsProcessing & Mining segrnents wa,s a more significant driver of thefinancial results for the second quarter of 2008.

Based on discussions with our customers, industry experience andknowledge of our internal improvement initiatives, we remainconfident in our ability- to reach our 2010 targets of 912 billion in.revenue with a 12% operating margin. Our growing emphasis ondeveloping markets should help to partially offset the effects ofeconomic slowing in mature markets. Certain developing markets areinvesting their oil wealth, such as Middle Eastern countries andRussia, or their substantial foreign currency reserves achieved fromexporting, such as China, in a wide array of infrastructure projectsthat will require many years to complete. Additionally, the high priceof oil is resulting in extensive energy investments such as windpower, nuclear and coal/gas fired power plants, which drives demandfor Terex products, particularly cranes,.

We remain committed to our previously announced stock 'repurchaseprogram. During the second quarter of 2008, we repurchasedapproximately 9144 million of Terex common stock pursuant to thestock repurchase program. Through June 30, 2008, we repurchasedapproximately $362 million of our common stock under this program,or approximately 5.5 million shares, On July 15, 2008, our Board ofDirectors authorized an increase in this program of 8500 million to$1,2 billion, with no change to the program expiration date of June30, 2000.

The first quarter of the year typically reflects growth M workingcapital as we 1-mild inventor y to prepare for the Northern Hemispheresummer selling season. Much of this inventory build during the firstquarter of the year is then shipped 'in the second quarter or early in thethird quarter, After adjusting for the impact of 'acquisitions andforeign exchange, inventory was basically flat as compared to the firstquarter of 2008. This reflects a mix of inventory growth to supportdemand 'For cranes, material processing and mining equipment,combined with challenges with supplier parts availability at certainlocations, and slowing demand in certain end markets that negatively'impacted finished goods.

23

We are focused on a number of internal improvement initiatives toincrease sales and profitability, and to manage asset utilization as wecontinue our progress with becoming an excellent operating company.Our emphasis CM supply management is helping to cushion to someextent the rising commodity prices, such as the price of steel. We areaggressively managing this situation and expect that we will be ableto offset cost increases by increasing pricing commensurately,

. although the timing of cost increases versus price increases may notcorrelate perfectly. Implementation of the Terex Management System("TMS"), our enterprise resource-planning system, continues toprogress, with three businesses located in the U.S., the UnitedKingdom and Germany having instituted TMS, representing three ofour important manufacttiring sites. TMS will provide greater visibilityinto costs, spending and asset utilization; providing valuableinformation for management to continue to improve the business.

36. On September 4, 2008, Terex announced via press release both an update to its FY

2.008 guidance which lowered its earnings per share guidance and disclosed negative factors

impacting the Company's financials and business. The press release stated, in relevant part, as

follows:

Terex Corporation (NYSE: TEX) today announced that it is updating2008 full year guidance and providing quarterly guidance due tochanging market conditions. Full year 2008 earnings per share areexpected to be between $6.5 and 86.65 compared to $5.85 for thefull year 2007, a 956 to 14% increase. Net sales .for 2008 are expectedto be in the range of 810.2 to $10.6 billion, This guidance compares tothe previously announced range for 2008 earnings per share of $6.85to $7.15 and net sales of $10.5 to $10.9 billion.

Earnings per share are expected to be between 81.26 and 81.38 for thethird quarter of 2008 and between $1.20 and $1.33 in the fourthquarter of 2008. This outlook reflects an effective tax rate ofapproximately 3356 and the continued benefit of reduced share countfrom the Company's share repurchase program. All per share amountsare 00 0 fully diluted basis.

57, Concerning the lowered guidance figures. DeFeo stated, in relevant part:

While our Cranes and Materials Processing & Mining segmentscontinue to perform better than our expectations, continued marketsoftening and input costs in the Aerial Wc.)rk Platforms andConstruction segments in Western Europe and the United States areexpected to more than offset those positive factors.

24

58. On the negative disclosures 'concerning the Company's lowered FY 2008 guidance

and weakness in certain Company segments including Aerial Work Platforms and Construction,

Terex's stock price fell 89.30 a share or 20%, to close at 838.02 On September 4, 2008.

59. On October 22, 2008, Terex announced, via press release, its financial results for the

third quarter of 2008 ending September 30, 2008 (the "Q3 2008"). For the Q3 2008, Terex reported

net income of 893.8 million or 95 cents a share, a significant decrease over the third quarter of

2007's net income of $151.5 million or $1.45 a share. While the defendants noted the continued

global credit crisis, they failed to fully disclose the Company's true exposure to the credit crisis and

the impact on Terex's future financials.

60. Commenting on the Q3 2008 results, 'Defeo stated in relevant part:

While we continue to make progress on our improvement initiatives,the current environment is challenging, marked by a continued globalcredit crisis and worsening economic conditions, particularly in theU.S. and Western Europe. Input costs continue to present challengesfor us, although we expect these to moderate over time. At this time,our price increases have not yet fully offset our total material costincreases. We are taking aggressive actions to better position theCompany for the expected reduced net sales levels of the next twelvemonths, in particular in the .AWP, Construction, and MaterialsProcessing businesses. At the same time, we are continuing to investin developing markets and our improvement initiatives, as well asincreasing Cranes and Mining capabilities to meet the growingdemand in those areas,

We expect 2009 net sales, including the effect of announcedacquisitions, to be similar to 2008 full year net sales, driven bycontinued strong results in Cranes and Mining, offset by lower notsales in AWP, Materials Processing and Construction. The Cranes andMining businesses continue to grow, in particular in developingmarkets, where we expect current positive trends to continue.

. Beginning in the fourth quarter of 2008, for the next twelve monthswe expect net sales for AWP to be down 30%-40%, for MaterialsProcessing to be down 15°4-20% and for Construction to be down25%-3556 versus the prior twelve month period. In light of theseoverall expectations, we have taken or initiated several actions toproperly size our organization and production levels. Additionally, we

2.5

have further heightened our focus on cash generation during-, this timeof uncertain access to credit.

61. Riordan added, in relevant part:

We are taking a series of actions to aggressively reduce costs andinventories in the businesses listed below. We expect that by early2009 we will achieve working capital levels closer to 22% of trailingthree month annualized net sales, versus the approximately 25% level.we experienced at the end of the third quarter.

62. Concerning Terex's Q4 2008 and FY 2008 outlook, the press release stated, in

relevant part:

The Company is revising its estimated fourth quarter 2008 earningsper share guidance to reflect changing market conditions, mainly inNorth America and Western Europe for the AWP and Constructionsegments, to between $0.80 and $0.90, resulting in full year 2008earnings per share guidance between $5.69 and $5.79. Correspondingfull year 2008 net sales are expected to be between 810,0 and $10.3billion. These estimates include a total of 30.12 per share in chargesthrough the third quarter 2008 for the crane repair program andheadcount reductions. The full year 2008 guidance does not includeadditional charges that may be required to implement further costreduction activities. Management's previous earnings per shareguidance for the fourth quarter was between 81.20 and $1.33 and fullyear 2008 earnings per share guidance was between $6.35 and $6.65.

0 3 , Regarding Terex's results and reduced financial outlook. Widman stated, in relevant

part:

Given that external access to credit remains uncertain, we mustfocus on our cash mana gement. The adjustments to productionlevels and curtailment of incoming material in the AWP,Construction and Materials Processing businesses are expected toreduce inventory levels, and we will carefully manage incomingmaterial in Cranes and Mining to match the growth expectations ofthese businesses. We are delaying certain capital spending projectsand are not currently purchasing shares under our previouslyannounced share repurchase program. However, during the thirdquarter, we repurchased approximately $200 million, or 4.2 millionshares, and we remain committed to the share repurchase programwhen access to the capital markets is clearer.

With the actions we are taking to reduce costs and maintain

26

liquidity, we expect to have sufficient flexibility to execute our keybusiness plans.

64. Concerning Terex's "Construction" and "Roadbuilding, Utility Products and Other"

segments, the press release stated, in relevant part:

•Construction: Net sales for the Construction se gment for the thirdquarter of 2008 increased 4.9 0/s to $474,2 million versus the thirdquarter of 2007. Excluding the translation effect of foreigncurrency exchange rate changes of approximately $16 million andacquisition related net sales during the third quarter of 2008 ofapproximately $49 million, net sales decreased approximately .10%versus the prior year period.

Commercial construction remains weak in North America andcontinues to weaken in Western Europe, resulting in lower netsales for compact construction equipment. Developing marketdemand remains strong, particularly in Africa, the Middle East andEastern Europe, but is' not of significant scope to offset theweakness in developed markets. Large infrastructure and miningprojects continue to demand rigid frame dump trucks.

Construction experienced a negative operating margin of 6.0% forthe third quarter of 2008 as compared to a positive operatingmargin of 3.1% for the comparable period in 2007. The operatingloss was due to increased input costs combined with lower netsales volume (excluding the impact of acquisitions). Pricingactions have been taken to offset input cost increases and therecent volatility in steel pricing has begun to moderate, but slowingdemand in developed markets has resulted in production cuts andreductions in employment levels. Given the near termperformance, the Company will continue to monitor the estimatedfair value of the Construction business. for purposes of determiningwhether a goodwill impairment is evidenced.

*

Roadbuilding, -Utility Products and Other: Net sales for the RBUOsegment •for the third quarter of 2008 increased 17.7%, to $175.3million, versus the third quarter of 2007. Excluding the translationeffect of foreign currency exchange rate changes, net sales increasedapproximately 14%. The Utility Products, Roadbuilding andGovernment Programs businesses all witnessed net sales growth.

Demand for Utility Products remains favorable from electrical utilitycustomers. .Aging utility infrastructure and the replacement cycle of

27

existing equipment is supporting demand. R.oadbuilding net Saincreased during the third quarter of 2008 as compared to the thirdquarter of 2007 due to strong sales froin the Brazilian operationcombined with moderate sales growth in the U.S. This sales growthwas partially offset by lower concrete mixer truck sales,

Due to the low level of road building and inftaistructure funding in theU.S., the Company remains cautious regarding the sales outlook forRoadbuilding, and management continues to execute costcontainment strategies within this business. The Company willcontinue to monitor the estimated fair value of the Roadbuildingbusiness for purposes of determining whether goodwill impairment isevidenced.

RBUO operating margin was 2.482 in the third quarter of 2008 versusan operating loss of 1.7% for the conaparable .period in 2007.Increased volume for Utility Produas and the Brazilian based roadbuilding operation contributed to stronger margins for the thirdquarter of 2008. A bad debt chai-ge of approximately $4 million wasincurred in the . comparable period in 2007, for the Company's re-rental operation, a business that has since been wound down.

65. The Q3 2008 press release was followed by Terex's earnings conference call which

reiterated. the defendants' positive representations concerning the Company's Q3 2008 financial

results, business, product demand, operations and future prospects.

66. On November 3, 2008, Tcrex tiled its quarterly report for the Q3 2008 en a Form 10-

Q with the SEC ("Q3 2008 10Q") which reiterated the Company's previously announced Q3 2008

financial results. Regarding Terex's impairment charges, the 3Q 2008110Q, stated, in relevant part:

As of September 30, 2008, the roadbuilding reporting unit within theRoadbuilding, Utility Products and Other segment and theConstruction segment, which is a reporting unit, did not meet theforecasted business performance used in the annual goodwillimpairment test as of October 1, 2007, The downturn in the U.S.residential. housing market, limited funding for infrastru.eture projectsand decreased demand has negatively impacted the businesses inwhich these reporting units operate.

The Company updated its forecast to address the impact of changes inbusiness eonditions and performed a goodwill impairment test as ofSeptember 30, 2008 for the roadbuilding and construction reporting

28

units. The Company's assessment of the roadbuilding andconstniction reporting units' goodwill resulted in no impairment beingevidenced at September 30, 2008. 'The Company will continue tomonitor the estimated fair value of the roadbuilding and constructionbusinesses for purposes of determining whether impairment isevidenced. The amount of goodwill recorded for the roadbuilding andconstruction reporting units as of September 30, 2008 was $52.6 and8364.2 (million), respectively.

67. On February 3, 2009, Terex announced via press release an update to the Company's

earnings guidance. The press release stated, in relevant part:

Tcrex Corporation (NYSE:TEX) announced that it expects its earningsfor 2008 to be approximately 5% below the low end of its previous fallyear guidance of between $5.69 and 85.79 per fully diluted share.This revised guidance excludes charges associated with the reductionof our production levels, asset impairments and certain other items.Comparable earnings for the fuil year 2007 were 85.85 per fullydiluted share.

Although not yet finalized, the Company expects to record a non-eashimpairment Charge of certain of the Company's goodwill, identifiableintangibles and other non current assets principally related to itsConstruction, Roadbuilding and Utilities businesses. This impairmentcharge is es6mated to be 'approximately $600 million, only a portion of\vhieh will be tax affected. We are currently in compliance with all ofthe financial covenants under our bank credit facilities and indenturesand this impairment charge will not affect our compliance.

63. Regarding Terex's lowered 2008 guidance, DeFeo stated, in relevant part:

Our fourth quarter 2008 results were affected by the rapid change inglobal economic conditions tnore than we anticipated, as well ascontinued input cost pressure. We continue to feet the negative effectthat credit availability has on customer sentiment arR-I demand for ourproducts, particularly in our Construction, Materials Processing andAerial Work Platforms businesses, as well as our smaller crane andtower crane product lines.

In response to the present economic environment, we are taking andwill continue to take aggressive actions to -reduce costs and inventoriesin all of our businesses. We feel we have responded appropriatelywith significant actions already in progress, many of which we beganlate last summer and fail. Our actions include reductions in force,.significantly curtailed production schedules in affected businesses,including temporary and permanent factory shutdowns, facility

consolidations, the rescheduling of incoming raw materials andre,dueing executive compensation costs.

69. On February 11, 2009, Terex announced via press release its Q4 2008 and FY 2008

results. For FY 2008, Terex announced net income of 871,9 million or 72 cents a share, a dramatic

decrease from FY 2007's net income of 8613.9 million, or 85.85 a share. The Company attributed

the results to goodwill impairment charges that reduced net income by $4.60 a share and ether pre-

tax charges totaling 825.8 million, which decreased FY 2008 net income by 18 cents a share. The

press release, stated, in relevant part:

Terex Corporation (NYSE: TEX) today announced a net loss for thefourth quarter of 2008 of 8421.5 million, or 84.46 per share. The netloss in the fourth quarter includes pre-tax non-cash charges of 8459.9

or $4.84 per share, for the impairment of goodwill. Thesecharges were in the Company's ,Construction, Roadbuilding andUtility Products businesses. Additionally, the Company incurred pre-tax charges of 821.8 million, or 80.24 per share, primarily associatedwith a reduction in production levels in the fourth quarter of 2008.These results compare to net income of $174.0 million, or $1.67 pershare, for the fourth quarter of 2007. All per share amounts are on afully diluted basis.

Net sales for the fourth quarter of 2008 dropped by approximately20% to 82,08 billion versus 82.59 billion in the fourth quarter of 2007,as deelining demand in the Conipany's Aerial 'Work. Platforms,Construction and Materials Processing businesses continued. Thetranslation effect of foreign currency exchange rate changes negativelyimpacted fourth quarter 2008 net sales by approximately 806, whileacquisitions added approximately 206 to net sales over the prior year'sfourth quarter.

For the full year 2008, the Company reported net income of $71.9million, or $0.72 per share, compared to net income of 8613.9 million,or $5.85 per share, for the full year 2007. The goodwill impairmentcharges mentioned above reduced net income by $4.60 per share forthe full year, and other pre-tax charges totaling $25.8 million,primarily related to adjustment of the Company's production levels,decreased full year 2008 net income by 80.18 per share. Net incomefor 2007 included a $12.5 million pre-tax charge related to the earlyextinguishment of the Company's 9-1/4% Senior Subordinated Notes,which negatively impacted earnings per share by 80.08.

30

Net sales were 89,89 billion in 2008, an increase of 8.2% -from $9.14billion in 2007. "Fhe translation effect of foreign currency exchangerate changes accounted for approximately 3% of the increase in netsales and acquisitions contributed approximately 3 ev,S of the increase innet sales, The strong full year performance of the Cranes and Miningbusinesses were offset by the dramatic decline in demand for many ofthe Conipany's other products during the second half of 2008. largelydue to the impact of the rapidly deteriorating global economy,

70. C2ornmenting on Terex's disappointing financial results, DeFeo stated:

This past year has been like no other the first half of the yearexhibited robust growth and expansion, white the second half of theyear was severely impacted by the global credit crisis and economicdeterioration, which drove significant declines in customer demand inour businesses, For the fall year, net sales increased significantly inour Cranes and Mining businesses, but were offset by the results in ourAerial Work Platforms, Construction, and Materials Processingbusinesses, which experienced considerable weakness in the secondhalf of the year. Exc.:luding the goodwill impairment charges, our netincome for the year was good given the economic environment.Although we are disappointed with our current working capital levels,we have taken aggressive actions to adjust our production to mootreduced customer demand.. We maintained 0 strong cash position andended the year with a solid 'balance sheet and sufficient liquidity toexecute our key business plans.

Given the current market conditions, it is difficult to project 2009performance with a reasonable degree of certainty. However, we areplanning for continued softness in demand. We are experiencing,increasing levels of cancellations in our backlog for crane and miningproducts, as well as delays in acceptance of deliveries, as ourcustomers in these areas are not immune to thc effects of the globaleconomic downturn. Based on what we know today, we expect our netsales for 2009 to decline by 30°/0 to 35% from 2008. The translationeffect of foreign currency exchange rate changes is expected tocontribute approximately 13%, of this decline. Given the uncertaintyand volatility in today's environment, we are not providing earningsguidance until we have better visibility; however, we will continue totake aggressive actions to reduce operating eosts and improve our cashflow.

'71. Concerning Terex's various backlogs, the press release stated, in relevant part:

Backlog: Backlog of orders deliverable during the next twelve monthswas $2.96 billion at December 31, 2008, a decrease of 29.3% and18.5% versus December 31, 2007 and September 30, 2008,

31

respectively. The decrease was mainly driven 'by significant reductionsin orders for the .Aerial Work Platforms, Materials Processing, andConstruction businesses, as well as the •transiation effect of foreigncurrency exchange rate changes. During the fourth quarter, theCompany also experienced softening demand and cancellations and

• rescheduling of orders in the Cranes and Mining businesses, as theCompany confirmed delivery expectations for production in 2009. Theabove numbers do not incorporate the approximate 8648 rniiiionCranes backlog adjustment at September 30, 2008 discussed below.

Aerial Work Platforms (AWP) segment backlog decreased 87.34 ascompared to December 31, 2007,. and decreased 67.7% as compared toSeptember 30, 2008, primarily due to a sigmificant decline in demandduring the fourth quarter as construction activity has dramaticallyslowed and many of the segment's end markets have experienced 40%to 5086 declines in demand. Many of the segment's customers areaging their rental fleets until there is greater clarity in their futurebusiness prospects.

Construction segment backlog decreased 64.886 versus the comparable.prior year period and decreased 45.1% as compared to September 30,2008, primarily due to a significant reduction in construction activityin most end markets for this segment's products. Backlog was alsoimpacted by the translation effect of foreign currency exchange ratechanges.

Cranes segment backlog decreased 4.0% when compared to December31, 2007 levels, and was flat as compared to September 30, 2008levels. As of September 30, 2008, Cranes had not accepted firm ordersfor a variety of crane types, primarily rough terrain cranes that werescheduled for delivery after January 1, 2009. Production -volume forwhich firm orders had not yet been accepted, and therefore notinci •uded in backlo g at September 30, 2008, approximated 8648

. million, A significant portion of these orders were cancelled during thefourth quarter of 2008 due to customer uncertainty regarding theglobal economic crisis, Backlog was also negatively impacted by acontinued softening in orders for tower cranes.

Materials Processing & Mining (MPM) segment backlog decreased14,086 versus December 31, 2007, primarily due to the translationeffect of foreign currency exchange rate changes, and decreased 31.6%as compared to September 30, 2008, primarily due to rec,ent softness inglobal commodity demand and continued weak demand for MaterialsProcessing products.

Roadbuilding,, Utility Products and Other (RBUO) segment backlogdeclined 24.786 versus December 31, 2007 and declined 17.486 as

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compared to September 30, 2008, mainly due to reduced demand forNorth American asphalt plants and concrete mixer trucks,

Concerning Terex's "Construction" and "Roadhuilding, Utility Products and Other"

segments, the press release noted, in relevant part:

Construction: Net sales for t.he Construction segment for the fourthquarter of 2008 decreased $202.2 million, or 37.0%, to 8343.9 millionversus the fourth quarter of 2007. Excluding the translation effect offoreign currency exchange rate changes and acquisition related netsales during the fourth quartet' of 2008, net sales decreasedapproximately 34% versus the prior year period. Weakness in WesternEurope that developed very quickly during the third quarter of 2008a-nd continued into the fourth quarter was the primary driver of lowerTlet sales, Demand for construction equipment remained soft asresidential and non-residential construction experienced increasingweakness globally.

In the fourth quarter of 2008, Construction experienced an operatingloss of $66.8 million, excluding impairment charges of $364.4 million,as compared to operating income of $12,5 million for the comparableperiod in 2007. Lower volume and, to a lesser extent, higher inputcosts, mainly steel, and costs associated with reductions in productionlevels, primarily drove the decrease as compared to the fourth quarterof 2007.

*

Roadbuilding, Utility 'Products and Other: Net sales for the RBUOsegment for the fourth quarter of 2008 increased $2.8 million, orto $182.1 million versus the fourth quarter of 2007. Excluding thetranslation effect of foreign currency exchange rate changes andacquisitions, net sales increased approximately 4%. Sales of utilityproducts inc,reased modestly during the fourth quarter of 2008 versusthe comparable period in 2007, and increased net sales of roadbuildingequipment manufactured in Latin America more than offset weakerconcrete inixer truck sales and softer sales of roadbuilding equipmentin North America.

Operating income for the fourth quarter of 2008, excluding impairmentcharges of $95,5 million, was $0.4 rnillion, an improvement comparedto the operating loss of $4.7 million for the comparable period in 2007,Operating income in the fourth quarter of 2008 benetitted from costreductions implemented earlier in the year, and was partially offset bycosts associated with a reduction in production levels, During thefourth quarter of 2007, the winding down of the Company's re-rental

33

business negatively impacted operating profit by approximately $2inifl ion,

Effectb,'c January 1, 2009, the Roadbuilding businesses will beconsolidated within the Construction segment, the -Utility Productsbusinesses will be consolidated. within the AWP segment and theRBUO segment will cease to be a reportable segment.

73. Statements issued by the, defendants during the Class Period were materially false

and misleading because they failed to disclose and misrepresented the 'following material adverse

facts, including that: (a) Terex failed to properly and timely account for certain impaired assets

within the Cornpany including in its "Construction" and "Roadbuilding, Utility Products and Other"

segments/units; (b) Terex was experiencing declining demand for its products in its Construction,

Materials Processing and Aerial Work Platforms segments; (c) Terex's financials were much

weaker than represented; (d) Tcrex was not as prepared and di-versified as represented to withstand

its significant exposure to a weakening global credit market and economy; and (c) the defendants

lacked a reasonable basis for positive statements and representations concerning Terex's FY 2008

earnin gs guidance and the Company's overall business prospects.

74. On February 27, 2009, Tercx filed its Annual Report on a Form 10-K with the SEC

(the "2008 10K"). Concerning the Company's asset impairment charge, the 2008 10K stated; in

relevant part:

We -use ROIC as a unifying metric because we feel that it measures. how effectively wc, invest our capital and provides a better measure to

compare ourselves to peer companies to assist in assessing how wedrive operational improvement. We believe that ROIC measuresreturn on the full enterprise-wide amount of capital invested in ourbusiness, as opposed to another metric such as return on shareholder'sequity that oniy incorporates book equity, and is thus a more accurateand descriptive measure of our performance. We also believe thatadding :Debt less Cash and cash equivalents to Total stockholders'equity provides a better comparison across similar businessesregarding total capitalization, and RUC highlights the level of valuecreation as a percentage of capital invested. Consistent with thisbelief, we use ROTC in evaluating executive performance and

34

compnn. aS vir e have disclosed in the Comptn.t . ition Discussionand Ati,lyis in our proxy statement for the 2008 annual meeting ofstockholders. As of October 1, 2008, we performed our annualgoodwill impairment test, which resulted in a non-cash impairmentcharge for goodwill of $459.9 million, which represented all of thegoodwill recorded in the Construction and .RBUO segments.However, we do not believe that non-eash impairment charges areindicative of returns on our invested capital. Therefore, we haveexcluded the effect of these impairment charges from the metrics usedin our calculation of ROIC, As the tables below., show, our ROTC atDecember 31, 2008 WEIS 19.2%, down from 28,9% at December 31,2007. The decrease reflects reduced .NOPAT performance fromapproximately 8641 million to approximately 8601 million and theincreased invested capital impact of recent acquisitions ofapproximately 8482 million.

* *

As of October 1, 2008, we performed our annual goodwill impairmenttest, which resulted in a uon-cash impairment charge for goodwill of$459.9 million and represented all of the goodwill recorded in the.Construction and Raft) segments. This goodwill impairment chargewas necessary, as the fair value of the reporting units within thesesegments had significantly declined, reflecting reduced estimatedfuture cash flows for these businesses based on lower expectations forgrowth and pro .fitability, primarily as a result of the current globaleconomic downturn.

75. As of September 30, 2008, the Company told investors there was no goodwill

impairment. However, as of one day later, October 1, 2008, Terex reported a goodwill impairment

of nearly 8460 million.

76. Either the normal impairment or the likelihood of impending charges materially

affecting the Company's financial results were not disclosed to investors for months. .

77. On the news of the Company's weak financial results and forecast, Terex stock fell

$4.17 a share to close at 89.45 a share on February 12, 2009.

LOSS CAUSATION/ECONOMIC LOSS

78. During the Class Period, defendants engaged in a course of conduct that artificially

inflated the Company's securities and operated as a .frand and deceit on purchasers of Terex's

securities. The price of Tercx's common stock fell when the misrepresentations made to the

investing community, including the disclosure of materially false and misleading financial

statements, filings with the SEC arid statements issued through Terex's conference calls were

finally disclosed to investors. As a result, plaintiff and other members of the Class suffered

damages.

70. The failure to disclose to investors and analysts the adverse facts concerning Terex's

financials and operating condition as well as the Company's business prospects caused and

maintained the artificial inflation in Tcrex's stock price throughout the Class Period until the truth

was disclosed to the market. Throughout the Class Period, the defendants' false and misleading

statements had the intended effect and caused the Company's stock price to trade at artificially

inflated levels, trading, as high as approximately $76.25 a share in May of 2008.

FRAUD ON THE MARKET ALLEGATIONS

80. The market for Terex's securities was open, well-developed and efficient at all

relevant tinfes.

81. Because of the materially false and misleading statements and failures to disclose, set

forth above, Tercx's securities traded at artificially inflated prices during the Class Period.

22. Plaintiff' and other members of the Class purchased or otherwise acquired Terex's

securities relying upon the integrity of the market price of Terex's securities and market information

relating to Terex, and have been damaged thereby.

83. Daring the Class Period, defendants tTriaterially misled the investing -public, thereby

inflating the price of Terex's securities, by publicly issuing false and misleading statements and

omitting to disclose material facts necessary to make defendants' statements, as set forth herein, not

false and misleading. These statements and omissions were materially false and misleading in that

36

they failed to disclose material adverse infOrmation and misrepre,sented the truth about the

Company, its bu.siness and operations.

84, At all relevant times, the material misrepresentations and omissions particularized in

this Complaint directly or proximately caused or were a substantial contributing cause of the

damages sustained by plaintiff and. other members of the Class.

85. As described herein, durin g; the Class Period, defendants made oncaused to be made

a series of materially false or misleading statements about Tcrex's financial strength and business

prospects. These material misstatements and omissions had the ca-use and effect of creating in the

market an unrealistically positive assessment of Terex and its business, capitalization, and

prospects, thus causing the Company's securities to be overvalued and artificially inflated at all

relevant times.

86. Defendants' materially false and misleading statements during the .Class Period

resulted in plaintiff and other members of the Class purchasing the Company's securities at

artificially inflated prices, thus causing the damages comptained of herein,

SCIENTER

87. Defendants acted with scienter in .that they knew or recklessly disregarded that the

public documents and statements, issued or disseminated in the name of the Company were

materially false and misleadin g ; knew or recklessly disregarded that such statements or documents

would be issued or disseminated to the investing public; and knowingly and substantially

participated or acquiesced in the issuance and/or dissemination of such statements or documents in

primary violation of the federal securities laws.

88. As set forth herein, the individual Defendants, by—virtue of their receipt of

information reflecting the true facts regarding Terex, their control over and/or recei pt and/or

modification of Terex's allegedly materially misleading misstatements and/or their associations

37

with the Company which made them privy to confidential .oroprietary information concerning

Terex, participated in the fraudulent scheme alleged herein.

89. Because of their executive and managerial positions with Terex, the individual

Defendants had access to the adverse non-public information about the business, finances, markets

and present and future business prospects of 'Terex particularized herein via, access to internal

corporate documents, conversations or connections with corporate officers or employees,

attendance at management and Board of Directors' meetings thereof and/or via reports and other

information provided to them in connection therewith.

90. Defendants had a duty to promptly disseminate accurate and truthful information

with respect to Terex's business operations, financial condition and business prospects, or to cause

and direct that such information be disseminated and to promptly correct any previously

disseminated information that was misleading to the market.. As a result of their failure to do so, the

price of Terex's common stock was artificially inflated during the Class Period, damaging plaintiff

and the Class.

91. Defendants knew and/or recklessly disregarded the falsity and misleading nature of

the information that they caused to be disseminated to the investing public. The ongoing fraudulent

scheme described in this Complaint could not have been perpetuated over a substantial period of

tiinc, as has occurred, without the knowledge and complicity of the personnel at the highest level of

the Company, including the Individual Defendants.

92. Each defendant is liable as a primary violator of the securities laws in making false

and misleading statements', 'and for participating in a fraudulent scheme and course of business that

operated as a fraud or deceit on purchasers of Terex's securities during the Class Period.

o-}D. The individual Defendants, because of their positions with Terex, controlled the

contents of the quarterly reports, annual reports and press releases disseminated throughout the

38

Class Period, Each individual Defendant was provided with or had access to copies of the, reports

and press releases alleged herein to be false and/or raisleading prior to or shortly after their issua.nce

and :had the ability and oppoitunity to prevent their i,ssuanoe or cause them to be corrected. Because

of their positions and access to material non-public infomiation, the Individual Defendants knew or

recklessly disregarded that the adverse facts specified herein had not been disclosed to and were

being concealed from the public and that the positive representations which were being made were

false and misleading. As a result, each of the Individual Defendants is responsible for the accuracy

Terex's corporate releases detailed herein and is, therefore, responsible and liable for the

representations contained. therein,

94, In addition, during .the Class Period, certain of the Company insiders sold shares of

their personally held common stock for proceeds of approximately $9 million.

CLASS ACTION ALLEGATIONS

95, Plaintiff brings this action as a class action pursuant to Federal Rules of Civil

Procedure 2.3(a) and (b)(3) on behalf of a class (the, "Class") consisting of all persons and entities

who purchased or otherwise acc1nirc-,c1 the securities of Terex during the Class Period. Excluded are

defendants, any entity in which defendants have a controlling interest or is a parent or subsidiary of

or is controlled by the Company, and the officers, directors, employees, affiliates, legal

representatives, heirs, predecessors, successors and assigns of defendants,

96. The members of the Class are so num aro U.S. that joinder of all members is

impracticable. While the exact nuniber of Class members is unknown to plaintiff at this time arid

ean only be ascertained through appropriate discovery, plaintiff believes there are thousands of

members' of the Class,

39

97. Questions of law and fact are common to all mentibers of the Class and predominate

over any questions affecting solely individual members of the Class. Arnong the questions of law

and fact coinmon to die Class are

(a) whether the federal securities laws were violated by defendants aets as

alleged. herein;

(b) whether the Company issued materially false and misleading .fmancial

statements via press release, filing with the SEC and conference calls concerning Terex's financial

strength and business prospects, during the Class Period;

(c) whether defendants acted knowingly or recklessly in issuing materially false

and misleading statements;

(d) whether the market prices of the Company's securities during the Class

Period were artificially inflated because of defendants' conduct complained of herein; and

(e) whether the members of the Class have sustained damages and, if so, what is

the proper measure of damages.

98. .Plaintiff s claims are typical of the claims of the members of the Class as plaintiff

and the other members of the Class ea.ch sustained damages arising out of the defendants' wrongful

conduct in violation of federal law as complained of herein.

99. Plaintiff will fairly and adequately protect the interests of the members of the Class

and has retained counsel competent and experienced in class actions and securities litigation.

Plaintiff has no interests antagonistic to or in conflict with those of the Class.

100. A class action is superior to other available methods for the fair and efficient

adjudication of the controversy because joinder of all members of the Class is impracticable..

Furthermore, because the damages suffered by the individual Class members may be relatively

small, the expense and burden of individual litigation make it impossible for the Class members

40

individually to redress the wrongs done to them. Plaintiff anticipates no unusual difficulties in the

management of this action as a class action.

101. Plaintiff will rely, in part, upon the presumption of reliance established by the fraud

011 the market doctrine in that:

(a) defendants made public misrepresentations or failed to disclose material facts

c,oncerning •Terex's financial strength and business prospects, during the Class Period;

(b) such omissions and misrepresentations were material;

(. 1-2) the Company's securities traded in an efficient market and their prices were

inflated artificially during the Class Period beeause of defendants' misrepresentations and omissions

detailed herein;

(0) the misrepresentations and omissions alleged induced a reasonable investor to

misjud ge the value of the Company's securities; and

(e) plaintiff and the other members of the Class purchased Terex's securities

between the time defendants failed to disclose or misrepresented material facts and the time the true

facts were disclosed, without knowledge of the omitted or misrepresented facts.

102. Rased upon the factors set forth in the preceding paragraph, plaintiff and the other

members of the Class are entitled to the presumption of reliance upon the 'integrity of the market.

NO STATUTORY. SAFE HARBOR

103. The statutory safe harbor provided for forward-looking statements under certain

circumstances does not apply to any of the false statements pleaded in this Complaint because none

of the statements pleaded herein are "forward-looking" statements nor were they identified as

"fbrward-looking statements" when made. No meaningful cautionar y statements identified

important factors that could cause actual results to differ materially from those in any purportedly

forward looking-statements.

41

104. In the alternative, to the extent that the statutory safe harbor does apply to any

statements pleaded Herein that are deemed to be forward-looking, defendants are liable for those

false forward-looking statements because at the time each of those statements was made, the

speaker knew those forward-looking statements were false and/or the statement was authorized

and/or approved by an executive officer of Terex who knew that the statements were false when

made.

COUNT I

(VIOLATION OF SECTION 10(b) OF THE EXCHANGE ACT ANDRULE 10b-5 BROUGHT AGAINST ALL DEFENDANTS)

.105. Plaintiff repeats and realleges the allegations contained above as if fully set forth

herein.

106. During the Class Period, defendants directly engaged in a common plan, scheme, and

unlawful course of conduct, pursuant to which they knowingly or recklessly engaged in acts,

transactions, practices, and courses of business that operated as a fraud and deceit upon plaintiff and

the other members of the Class, and made various deceptive and untrue statements of material facts

and omitted to state material facts in order to make the statements made, in light of the

circumstances under which they were made, not misleading to plaintiff and the other members of

the Class. The purpose and effect of the scheme, plan, and unlawful course of conduct was, among

other things, to deceive the investing public, including plaintiff and the other members of the Class,

and to induce plaintiff and the other members of the Class to purchase Terex's securities during the

Class Period at artificially inflated prices.

107. During tl-ie Class Period, defendants, pursuant to said scheme, plan, and unlawful

course of ocinduct, knowingly and/or recklessly issued, caused to be issued deceptive and materially

false and misleading staterne.nts to the investing public as particularized above.

42

108. Because of defendants dissemination of and/or failure to correct the false and

misleading statements set 'forth above, the market price of Terex's securities was artificially' inflated

c.iurina the, Class Period. Unaware of the false and misleadinu nature of the statements described

above and the deceptive and manipulative devices and contrivances employed by defendants,.

plaintiff and the other members of the Class who purchased Terex's securities on the open market,

relied, to their detriment, on the integrity of the nrarket price of the securities in purchasing Terex's

securities.

109. I-lad plaintiff and the other members of the Class known the truth, they would not

have purchased Terex's securities or would not have purchased them at the inflated prices paid.

110. Plaintiff and the other members of the Class have sliffered damages as a result of the

wrongs herein alleged in an amount to be proven at trial.

111, By reason the foregoing, defendants have violated Section 10(b) of the Exchange Act

and RI:11e 10b-5 promulgated thereunder and are liable to plaintiff and the other me-mbcrs of the

Class for damages that they suffered in coimection with their purchases of Terex securities during

the Class Period.

COUNT II

VIOLATION OF SECTION 20(a) OF THE EXCHANGE ACTBROUGHT AGAINST DEFEDANTS DEFEO, WIDMAN AND RIORDAN. THE

INDIVIDUAL DEFENDANTS

112. Plaintiff repeats and realleges the allegations contained in 11 . 1 through 104 and `II 106

through 111 above as if fully set forth herein.

113. The Individual Defendants are liable as direct participants in the wrongs Complained

of herein,

114. Because they signed the SEC filings and/or because of the positions they held in

'Ierex management, the Individual Defendants directly participated in the day-to-day operations of

13

the Company and were privy to confidential proprietary information ecri.khn . ..iiiig the Company,

financial condition, and business operations.

115. The Individual Defendants are responsible for Terex's public filin gs: and press

releases, and are provided with copies of Terex's public filings and press releases alleged herein to

be misleading, prior to or shortly after their issuance and had the ability and opportunity to prevent

their issuance or cause them to be corrected..

116. The Individual Defendants are responsible for the accuracy of the public filings and

press releases detailed herein, and are therefore primarily liable for the representations contained

therein.

117. By reason of their management positions and ability to make public statements on

behalf of Terex, the Individual Defendants were and are controlling persons, and had the power and

influence to cause and did cause Terex to engage in the unlawful conduct complained of herein.

118. The Individual Defendants acted as controlling persons of the Company within the

meaning of section 20(a) of the Exchange Act as alleged herein. By virtue of their high-level as

officers and/or directors of the Company, and active participation in and/or awareness of the

Company's day-to-day operations, and/or intimate knowledge of the Company's business plans and

implementation thereof, each Individual Defendant had the power to influence and control and did

influence and control, directly or indirectly, the decision-making of the Company, including the

content and dissemination of the various statements that plaintiff alleges are false and misleading,.

The Individual Defendants were provided with, or had unlimited access to, copies of the Company's

reports, press releases ; public filings and other statements alleged herein to be misleading prior to

and/or shortly after these statements were issued and had the ability to prevent the issuance of the

statements or cause the statements to be corrected,

44

119. The ludi yidua.1 Defendants had the power to control on influence the particular

transactions ,giving rise to the securities violations as alleged herein, and exercised the same.

120. By virtue of their positions as controlling persons, the Individual Defendanis are

liable, pursuant to Section 20(a) of the Exchange Act.

121. As a direct and proximate result of the wrongful conduct of the Individual

Defendants, plaintiff and the other members of the Class suffered damages in connection with their

purchases of the Company's securities during the Class Period.

PRAYER FOR RELIEF

WHEREFORE, plaintiff, on its own behalf and on behalf of the Class, prays for judgment

.follows:

(a) .Declaring this action to be a class action pursuant to Rule 23(a) and (b)(3) of the

Federal Rules of Civil Procedure on behalf of the Class defined herein;

(b) Awarding plaintiff and the other members of the Class damages in an amoura that

rnay be proven at trial ; together with interest thereon;

(c) Awarding plaintiff and the members of the Class pre-judgment and post-judgment

interest, as well as their reasonable attorneys and experts' witness fees and other costs; and

(d) Such other relief as this Court deems appropriate.

45

JURY DEM. \ ND

Plaintiff demands a trial by jury.

Dated: January 1L---", 2010

SCOTT + SCOTT, LLP

"'- /7) • '•.

By: .--------• ' -

R. Scott-4'-edera1 Bar No. CT 16080)Erin Green Comite (Federal Bar No.CT 24886)108 Norwich AvenueColchester, CT 06415Tel.: 860-537-5537Fax: 860-537-4432

-and-

SCOTT + SCOTT, LEPJoseph Guglielmo (Federal Bar No (.T 27481)500 Fifth Avenue, 40th FloorNew York, NY 10110Tel.: (212) 223-6444Fax: (212) 229-6092

ZWERLING, SCHACHTER& ZWERLING-, LITRobert S. SchachterRichard A. SpeirsShaye J. Fuchs41 Madison Avenue •New York, NY 10010Tel.: (212) 223-3900Fax: (212) 371-5969

Attorneys Plaintyf

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