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Caterpillar Inc.: Files Form 11-K 401(k) -4-

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DJ Caterpillar Inc.: Files Form 11-K 401(k) Caterpillar Global Mining Legacy Hourly Employees' Savings Plan 2018



Caterpillar Inc.
Caterpillar Inc.: Files Form 11-K 401(k) Caterpillar Global Mining Legacy
Hourly Employees' Savings Plan 2018

25-Juin-2019 / 23:42 CET/CEST
Information réglementaire transmise par EQS Group.
Le contenu de ce communiqué est de la responsabilité de l'émetteur.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 11-K

ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF

1934

For the fiscal year ended December 31, 2018

OR

TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

For the transition period from_____to .

Commission File No. 1-768

CATERPILLAR GLOBAL MINING LEGACY HOURLY
EMPLOYEES' SAVINGS PLAN

(Full title of the plan and the address of the plan, if different from that
of the issuer named below)

CATERPILLAR INC.

510 Lake Cook Road, Suite 100, Deerfield, Illinois 60015

(Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office)

Caterpillar Global Mining Legacy Hourly Employees'

Savings Plan

Financial Statements and Supplemental Schedule
December 31, 2018 and 2017

Caterpillar Global Mining Legacy Hourly Employees' Savings Plan
Index

Page(s)

Report of Independent Registered Public Accounting Firm
Financial Statements

Statements of Net Assets Available for Benefits, December 31, 2018 and 2017
1

Statement of Changes in Net Assets Available for Benefits, Year Ended
December 31, 2018 2

Notes to Financial Statements, as of December 31, 2018 and 2017 and for the
Year Ended December 31, 2018 3

Supplemental Schedule

Schedule H, Line 4i - Schedule of Assets (Held at End of Year) December 31,
2018 16

Exhibit Index

23.1 - Consent of Independent Registered Public Accounting Firm

Signatures 18

Note: Other schedules required by 29 CFR 2520.103-10 of the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974 have been omitted because
they are not applicable.

Report of Independent Registered Public Accounting Firm

To the Administrator and Plan Participants of

Caterpillar Global Mining Legacy Hourly Employees'
Savings Plan

Opinion on the Financial Statements

We have audited the accompanying statements of net assets available for
benefits of Caterpillar Global Mining Legacy Hourly Employees' Savings Plan
(the "Plan") as of December 31, 2018 and 2017, and the related statement of
changes in net assets available for benefits for the year ended December 31,
2018, including the related notes (collectively referred to as the
"financial statements"). In our opinion, the financial statements present
fairly, in all material respects, the net assets available for benefits of
the Plan as of December 31, 2018 and 2017, and the changes in net assets
available for benefits for the year ended December 31, 2018 in conformity
with accounting principles generally accepted in the United States of
America.

Basis for Opinion

These financial statements are the responsibility of the Plan's management.
Our responsibility is to express an opinion on the Plan's financial
statements based on our audits. We are a public accounting firm registered
with the Public Company Accounting Oversight Board (United States) (PCAOB)
and are required to be independent with respect to the Plan in accordance
with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures
in the financial statements. Our audits also included evaluating the
accounting principles used and significant estimates made by management, as
well as evaluating the overall presentation of the financial statements. We
believe that our audits provide a reasonable basis for our opinion.

Supplemental Information

The supplemental Schedule H, Line 4i - Schedule of Assets (Held at End of
Year) as of December 31, 2018 has been subjected to audit procedures
performed in conjunction with the audit of the Plan's financial statements.
The supplemental schedule is the responsibility of the Plan's management.
Our audit procedures included determining whether the supplemental schedule
reconciles to the financial statements or the underlying accounting and
other records, as applicable, and performing procedures to test the
completeness and accuracy of the information presented in the supplemental
schedule. In forming our opinion on the supplemental schedule, we evaluated
whether the supplemental schedule, including its form and content, is
presented in conformity with the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income Security
Act of 1974. In our opinion, the supplemental schedule is fairly stated, in
all material respects, in relation to the financial statements as a whole.

/s/ PricewaterhouseCoopers LLP

Peoria, Illinois
June 25, 2019

We have served as the Plan's auditor since 2013.

Caterpillar Global Mining Legacy Hourly Employees' Savings Plan

Statements of Net Assets Available for
Benefits
December 31, 2018 and 2017
(in thousands of dolars) 2018 2017
Investments
Interest in the Master Trust $ 37,948 $ 42,340
Other investments - participant directed 224 292
brokerage accounts
Total investments 38,172 42,632
Receivables
Notes receivable from participants 1,070 1,107
Participant contributions receivable - 38
Employer contributions receivable 43 30
Other contributions receivable - 4
Receivables for securities sold - participant 59 36
directed brokerage accounts
Total receivables 1,172 1,215
Cash 25 -
Total assets 39,369 43,847
Liabilities
Payables for securities purchased - (32) (17)
participant directed brokerage accounts
Net assets available for benefits $ 39,337 $ 43,830

See accompanying notes to the financial statements.

1

Caterpillar Global Mining Legacy Hourly Employees' Savings Plan

Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 2018

(in thousands of dollars) 2018 Investment income (loss)

Plan interest in net investment income (loss) of the Master Trust $ (2,519)

Net appreciation (depreciation) in fair value of investments from
participant directed brokerage

accounts (119)

Net investment income (loss) (2,638)

Interest and dividend income

Interest income on notes receivable from participants 40

Interest and dividend income from participant directed brokerage accounts 41

Total interest and dividend income 81

Contributions

Participant 1,732

Employer 905

Total contributions 2,637

Deductions

Participant withdrawals (4,521)

Administrative expenses (52)

Total deductions (4,573)

Net increase (decrease) in net assets available for benefits (4,493)

Net assets available for benefits

Beginning of year 43,830

End of year $ 39,337

See accompanying notes to the financial statements.

2

Caterpillar Global Mining Legacy Hourly Employees' Savings Plan

Notes to Financial Statements
December 31, 2018 and 2017

1. Plan Description

The following description of the Caterpillar Global Mining Legacy Hourly
Employees' Savings Plan (the "Plan") provides only general information.
Participants should refer to the Plan documents for more complete
information regarding the Plan.

General

The Plan is a profit sharing plan that includes a cash or deferred
arrangement under Section 401(k) of the Internal Revenue Code ("IRC") and is
an "employee stock ownership plan" within the meaning of IRC Section
4975(e)(7). The Plan is maintained and sponsored by Caterpillar Inc. (the
"Company") for employees of Caterpillar Global Mining LLC, a 100
percent-owned subsidiary of the Company, and enables eligible employees to
accumulate funds for retirement. The Plan is governed by the provisions of
the Employee Retirement Income Security Act, as amended ("ERISA").

Participation

Employees whose employment is governed by the collective bargaining
agreement with the Steelworkers Union Local #1343 ("SMKE") and those whose
employment is governed by the collective bargaining agreement certified by
the National Labor Relations Board Case No. 16-RC-7210 ("Denison") are
eligible to participate in the Plan. SMKE employees are eligible to
participate in the Plan after they have completed 480 hours of service and
Denison employees are generally eligible on the first day of employment.
Plan participation is voluntary and participating eligible employees (the
"participants") elect to defer a portion of their eligible compensation
through pre-tax and after-tax contributions.

Contributions

All participants are eligible to make participant contributions up to 70
percent of their eligible compensation through a pre­tax deferral
arrangement and an after-tax Roth 401(k) arrangement as elected by each

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participant. Participants who are at least 50 years old by the end of the
calendar year are allowed to make a catch-up contribution for that year.
Contributions are subject to certain limitations set by the IRC.

All participants also are eligible for employer matching contributions which
are 100 percent of participant 401(k) contributions up to a maximum of 6
percent of eligible compensation.

Participants direct the investment of their contributions and employer
matching contributions into various investment options offered by the Plan
as discussed in Note 3. Participants generally may change their contribution
elections and prospective investment elections on a daily basis and
reallocate the investment of their existing account balance either daily or
every seven business days (if subject to applicable trading restrictions)
depending on the investment.

Newly eligible participants are subject to an automatic enrollment process.
Unless electing otherwise, participants who become newly eligible will be
enrolled with a default 6 percent deferral of their eligible compensation,
and their default investment election is the Target Retirement Fund closest
to the year in which the participant turns age 65. The salary deferral for
Denison participants will increase by an additional 1 percent each
subsequent year up to a maximum 15 percent, unless otherwise instructed by
the participant.

Participant Accounts

Accounts are separately maintained for each participant. The participant's
account is credited with the participant's contributions, employer matching
contributions, Plan earnings/losses (based on each participant's investment
elections) and charged with administrative expenses. Participants are
entitled to the benefit that can be provided from the participant's vested
account.

3

Vesting and Distribution Provisions

Participants are fully vested in their participant contributions and related
earnings thereon. SMKE participants also vest immediately in the employer
matching contributions and the related earnings thereon. Denison
participants fully vest in their employer matching contributions and the
related earnings thereon as follows:

Years of Service Percentage Vested
Less than one 0%
1 20%
2 40%
3 60%
4 80%
5 and more 100%

The Plan provides for 100 percent vesting of all contributions and the
related earnings thereon upon a participant's death while actively employed
or disabled or a participant's death while performing qualified military
service.

Upon termination of employment for any reason, including death or
retirement, the balance in a participant's vested account is distributable
in a single lump sum cash payment. Historically, the Plan allowed the
participant (or beneficiary) to elect periodic withdrawals. Any current
benefits being paid as periodic withdrawals will continue to be paid in
installments until participant's vested account balance is fully
distributed. Participants also have the option to leave their vested account
balance in the Plan, subject to certain limitations. A participant also may
elect to receive a distribution of Company shares up to the amount of the
participant's balance in the Caterpillar Stock Fund on date of election. The
value of shares will be based upon the average price per share The Northern
Trust Company (the "Trustee") receives from the sale of Company shares for
the purpose of making the distribution.

Company contributions forfeited by terminated participants are used to
reduce future Company contributions to the Plan. The amount forfeited and
used to reduce future Company contributions for the year ended December 31,
2018 was $16 thousand.

Notes Receivable from Participants

The Plan provides for participant loans against eligible participant account
balances. Eligible participants obtain loans by filing a loan application
with the Plan's recordkeeper and receiving all requisite approvals. Loan
amounts are generally limited to the lesser of $50,000 or 50 percent of the
individual participant's vested account balance, with certain regulatory
restrictions. The minimum loan permitted is $1,000 and participants may only
have one outstanding loan at any time. Each loan specifies a repayment
period that cannot extend beyond five years. Loans bear interest at the
prime interest rate plus 1 percent, as determined at the time of loan
origination. Loans that transferred to the Plan due to acquisitions are
based upon the terms of the plan agreement in effect at the time of loan
origination. Repayments, including interest, are made through payroll
deductions and are credited to the individual participant's account balance.
Participant loans are measured at their unpaid principal balance plus any
accrued but unpaid interest. For participant loans that are in default, the
amount of the unpaid loan principal and interest due to the Plan will be
treated as a deemed distribution. Deemed distributions are reported as a
taxable distribution and remain part of the participant's account balance
until a distributable event occurs (i.e. termination of employment).

Administration

The Plan is administered by the Company. Pursuant to procedures adopted by
the Company, responsibility for the Plan's non-financial matters has been
delegated to the Benefits Administrative Committee and responsibility for
the Plan's financial matters has been delegated to the Caterpillar Inc.
Benefit Funds Committee. The Company and the Benefit Funds Committee have
entered into a trust agreement with the Trustee to receive contributions,
administer the assets of the Plan and distribute withdrawals pursuant to the
Plan. The Company has retained Alight Solutions to provide recordkeeping and
administrative services as part of the administration of the Plan.

4

Plan Termination

The Company has the right under the Plan at any time to terminate the Plan,
subject to provisions of ERISA and subject to the terms of any applicable
collective bargaining agreement. In the event of Plan termination,
participants will become fully vested in all benefits which have been
accrued up to the date of Plan termination and Plan assets will be
distributed in accordance with the provisions of the Plan.

Plan Qualification

The Plan obtained its latest determination letter on March 16, 2015, in
which the Internal Revenue Service ("IRS") stated that the Plan and related
trust, as then designed, were in compliance with the applicable requirements
of the IRC. Although the Plan has been amended subsequent to the period
covered by the determination letter, the Plan Administrator and the Plan's
counsel believe that the Plan is designed and is currently being operated in
compliance with the applicable requirements of the IRC, and therefore,
believe that the Plan is qualified and the related trust is tax-exempt.

Accounting principles generally accepted in the United States of America
require management to evaluate tax positions taken by the Plan and recognize
a tax liability if the Plan has taken an uncertain position that more likely
than not would not be sustained upon examination by the IRS. The Company has
analyzed the tax positions taken by the Plan and has concluded that, as of
December 31, 2018 and 2017, there are no uncertain positions taken or
expected to be taken that would require recognition of a liability or
disclosure in the financial statements. The Plan is subject to routine
audits by taxing jurisdictions; however, there are currently no audits for
any tax periods in progress. The Company believes the Plan is no longer
subject to income tax examinations for tax years prior to 2011.

2. Summary of Significant Accounting Policies and New Accounting
Pronouncements

New Accounting Pronouncements

Employee Benefit Plan Master Trust Reporting - In February 2017, the
Financial Accounting Standards Board issued accounting guidance to improve
the usefulness of information reported to users of employee benefit plan
financial statements and to provide clarity to preparers and auditors. The
new guidance primarily relates to the reporting by a plan for its interest
in a master trust. The new guidance requires that a plan's interest in each
master trust and changes in those interests be reported in separate line
items in the statement of net assets available for benefits and statement of
changes in net assets available for benefits, respectively. The new guidance
also removes the requirement to disclose the percentage interest for plans
with a divided interest in a master trust, requires all plans to disclose
the dollar amount of their interest in each general investment type of the
master trust, and requires plans to disclose the master trust's other asset
and liability balances and the dollar amount of the plan's interest in each
of those balances. In addition, the guidance also eliminates redundancy
relating to 401(h) account asset disclosures which is not applicable to the
Plan. This guidance is effective for the Plan year ending December 31, 2019,
with early adoption permitted. The Plan's management has elected to early
adopt the new guidance effective December 31, 2018 and has applied it
retrospectively. The adoption of this guidance did not have a material
impact on the Plan's financial statements.

Basis of Accounting

The financial statements of the Plan are prepared on the accrual basis of
accounting in accordance with accounting

principles generally accepted in the United States of America.

Investments

The Plan's interest in the Caterpillar Investment Trust ("Master Trust") and
investments included in the participant directed brokerage accounts are
valued as described in Note 4. Interest on investments is recorded daily as
earned. Dividends are recorded on the ex-dividend date. The Master Trust
presents, in Note 4, in Net investment income (loss), the net appreciation

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DJ Caterpillar Inc.: Files Form 11-K 401(k) -3-


(depreciation) in the fair value of its investments which consists of the
realized gains (losses) and the unrealized appreciation (depreciation) on
those investments. Purchases and sales of securities are recorded on a
trade-date basis.

5

Administrative Expenses

The Plan charges a $5 per month per participant fee, which is transferred
monthly from the Master Trust into a holding account to pay expenses as they
come due. The amount accumulated in the holding account is used to pay
certain administrative expenses that have been approved by the Benefit Funds
Committee including recordkeeping fees, trustee fees, plan education and
audit fees. The Company pays any administrative expenses which exceed
amounts collected from participants annually by the Plan, excluding
applicable expenses paid directly from participant accounts described below.
If amounts collected from participants exceed certain administrative
expenses, the Company determines whether a corrective action is appropriate
which could include a reallocation of funds back to participant accounts or
a structural change to the participant fees.

In addition, certain administrative expenses are paid directly from
participant accounts. These administrative expenses include quarterly fees
for participants invested in the participant directed brokerage option,
quarterly fees for participants that utilize managed account services and
processing fees for qualified domestic relations orders.

Participant Withdrawals

Participant withdrawals are recorded when paid.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and changes therein, and disclosure of
contingent assets and liabilities. Actual results could differ from those
estimated. The Company believes the techniques and assumptions used in
establishing these amounts are appropriate.

Risks and Uncertainties

The Plan invests in a combination of stocks, bonds, fixed income securities,
common collective trusts, mutual funds and other investment securities.
Investment securities are exposed to various risks, such as interest rate,
market and credit risks. Due to the level of risk associated with certain
investment securities, it is at least reasonably possible that changes in
the values of investment securities could occur in the near term and that
such changes could materially affect participant account balances and the
amounts reported in the Statements of Net Assets Available for Benefits.

3. Investment Programs

Investment options that are currently available to participants consist of
three main categories: Target Retirement Funds,

core investment options (including the Caterpillar Stock Fund) and a
participant directed brokerage option.

The Target Retirement Funds are portfolios created primarily from the Plan's
core investment options. The goal of these funds is to give participants
investment options that provide an age appropriate asset allocation. Each
Target Retirement Fund contains a blend of stock and bond investments. The
proportion of stocks and bonds in each fund is based on an anticipated
retirement date and will change over time. These funds automatically change
the asset allocation over time to maintain an appropriate level of risk for
the retirement horizon. Below are the Target Retirement Funds for
participants based upon their birth year with the assumption that
participants will retire at the age of 65 and the asset allocation for the
2018 Plan year.

Target Retirement Funds Birth Years Asset Allocation
Target Retirement Income Before 1954 37.5% stocks, 52.5%
Fund bonds and 10% cash
equivalents
Target Retirement 2020 1954-1958 44.5% stocks, 49.5%
Fund bonds and 6% cash
equivalents
Target Retirement 2025 1959-1963 59% stocks and 41% bonds
Fund
Target Retirement 2030 1964-1968 69% stocks and 31% bonds
Fund
Target Retirement 2035 1969-1973 77% stocks and 23% bonds
Fund
Target Retirement 2040 1974-1978 83% stocks and 17% bonds
Fund
Target Retirement 2045 1979-1983 86% stocks and 14% bonds
Fund
Target Retirement 2050 1984-1988 86% stocks and 14% bonds
Fund
Target Retirement 2055 1989-1993 86% stocks and 14% bonds
Fund
Target Retirement 2060 1994 & 86% stocks and 14% bonds
Fund After

6

In addition to the Target Retirement Funds, the Plan also provides
participants with core investment options which are made up of actively
managed investment funds and index funds. The following table presents the
investment funds and index funds that are currently available to
participants.

Menu of Core Investment Options
U.S. Large Cap Equity Funds Capital Preservation
Funds
1 Caterpillar Stock Fund 8 Stable Principal Fund

2 U.S. Large Cap Equity Fund 9 Money Market Fund

3 U.S. Large Cap Equity Index Fund
U.S. Small/Mid Cap Equity Funds Fixed Income Funds
4 U.S. Small/Mid Cap Equity Fund 10 Bond Fund

5 U.S. Small/Mid Cap Equity Index 11 Bond Index Fund
Fund
International Equity Funds
6 International Equity Fund

7 International Equity Index Fund

The Caterpillar Stock Fund consists of Caterpillar Inc. common stock and a
small amount of cash and/or cash equivalents.

The participant directed brokerage option allows participants to invest
outside of the standard Plan options. Alight Financial Solutions is the
introducing broker/dealer and Pershing, a division of BNY Mellon, is the
custodian/clearing firm for the participant directed brokerage option. The
types of investments offered through the participant directed brokerage
option are individual company stocks (excluding Caterpillar Inc. common
stock), exchange traded funds, registered investment companies and fixed
income securities such as bonds.

Participants also have the option to enroll in professional account
management through the Plan's recordkeeper for additional, separately
charged fees.

4. Master Trust

Substantially all of the Plan's investments are held in the Master Trust,
which was established for the investment of the Plan and other Company
sponsored retirement plans. The Northern Trust Company is the Trustee of the
Master Trust and the custodian for funds invested through the core
investments and the Target Retirement Funds (the funds invested through the
core investments and the Target Retirement Funds are referred to as the
Master Trust herein). The Plan and the other Company sponsored retirement
plans pool their investments in the Master Trust in exchange for a
percentage of participation in the Master Trust. The Plan has a specific
interest in the Master Trust.

7

The following table presents the net assets of the Master Trust and the
Plan's interest in the net assets of the Master Trust as of December 31,
2018 and 2017.

(in Master Trust Plan's Interest in Master
thousands of Trust
dollars)
2018 2017 2018 2017
ASSETS
Investments,
at fair
value
Caterpillar $ $ $ 323 $ 478
Inc. common 2,185,923 2,787,928
stock
Common 1,817,252 1,878,127 7,731 8,109
stocks
Preferred 14,484 15,970 87 98
stocks
Preferred 23,239 14,548 190 115
corporate
bonds and
notes
Other 624,381 598,098 5,259 4,887
corporate
bonds and
notes
U.S. 467,078 613,587 3,804 4,846
government
securities
Common 4,212,005 4,506,627 18,304 21,584
collective
trusts
Registered 989 4,125 6 25
investment
companies
Interest 14,738 90,212 96 703
bearing cash
Other 133,485 135,958 709 754
investments,
net
9,493,574 10,645,180 36,509 41,599
Investments,
at contract
value
Fully 618,170 565,569 1,667 1,415
benefit-resp
onsive
synthetic
guaranteed
investment
contracts
Other assets
Cash 4,461 2,407 33 19
Receivables 108,710 65,512 820 485
for
securities
sold
Accrued 14,696 14,525 107 100
income
127,867 82,444 960 604
Total Master 10,239,611 11,293,193 39,136 43,618
Trust assets
LIABILITIES
Payables for (142,058) (158,769) (1,188) (1,278)
securities
purchased
Net Master $ $ $ 37,948 $ 42,340
Trust assets 10,097,553 11,134,424

The fully benefit-responsive synthetic guaranteed investment contracts are
valued at contract value as described in the Investment Contracts section of
Note 4. All other investments are stated at fair value and are valued as
described below:

· Common and preferred stocks: Primarily valued at quoted market prices.

· Preferred and other corporate bonds and notes: Valued based on matrices
or models from reputable pricing vendors and may be determined by factors
which include, but are not limited to market quotations, yields,
maturities, call features, ratings, institutional size trading in similar
groups of securities and developments related to specific securities.

· U.S. government securities: Valued based on matrices or models from
reputable pricing vendors.


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· Common collective trusts: Primarily stated at net asset value ("NAV") of
units held. The Plan's management have elected the practical expedient to
use NAV in measuring the fair value of the underlying investments.

· Registered investment companies: Valued at quoted market prices that
represent the net asset value of shares held by the Master Trust.

8

· Interest bearing cash: Stated at cost which approximates fair value.

· Other investments, net: Primarily valued at quoted market prices, when
available, or valued based on matrices or models from reputable pricing
vendors.

The preceding methods may produce a fair value calculation that may not be
indicative of net realizable value or reflective of future fair values.
Furthermore, although the Company believes its valuation methods are
appropriate and consistent with other market participants, the use of
different methodologies or assumptions to determine fair value of certain
financial instruments could result in a different fair value measurement at
the reporting date.

The following tables summarize Master Trust investments measured at fair
value based on NAV per share using the practical expedient that have
unfunded commitments or redemption restrictions as of December 31, 2018 and
2017.

(in thousands of dollars)

December 31, Unfunded Redemption Redemption Redemption
2018 Restrictio Frequency Notice
ns (if Period
currently
Fair Value eligible)
Commitments
Common
collective
trusts:
Stocks $3,275,081 - None Daily None
Short-term $ 351,246 - None Daily None
investments
U.S. Government $ 552,945 - None Daily None
securities
Private placement - Mortgages Yes 1 Monthly 1 Yes 1
$ 32,733 -

1 Redemptions allowed once per month and are restricted to available cash on
hand as determined by the trustee of the fund. A notice of redemptions
required five days prior to the last business day of the month.

(in thousands of dollars)

December 31, Unfunded Redemption Redemption Redemption
2017 Restrictio Frequency Notice
ns (if Period
currently
Fair Value eligible)
Commitments
Common
collective
trusts:
Stocks $3,620,897 - None Daily None
Short-term $ 337,455 - None Daily None
investments
U.S. Government $ 516,228 - None Daily None
securities
Private placement - Mortgages Yes 1 Monthly 1 Yes 1
$ 32,047 -

1 Redemptions allowed once per month and are restricted to available cash on
hand as determined by the trustee of the fund. A notice of redemptions
required five days prior to the last business day of the month.

9

The following table presents the changes in net assets for the Master Trust
for the year ended December 31, 2018.

(in thousands of dolars) 2018

Changes in Net Assets:

Caterpillar Inc. common stock net appreciation
(depreciation) in

fair value of investments $ (517,605)
Net appreciation (depreciation) in fair value of (632,836)
investments
Interest 63,716
Caterpillar Inc. common stock dividends 56,802
Dividends 39,778
Other income 4,397
Net investment income (loss) (985,748)
Transfers, net 1 (38,778)
Administrative expenses not directly allocated to (12,345)
the plans and other expenses 2
Increase (decrease) in net assets (1,036,871)
Net assets
Beginning of the year 11,134,424
End of the year $ 10,097,553

1 Represents items recorded at the plan level such as contributions, benefit
payments, plan transfers and plan specific administrative expenses.

2 Primarily related to fees and expenses paid to professional money managers
who manage the investment funds.

Investment Contracts

The Master Trust holds fixed income fully benefit-responsive investment
contracts, referred to as synthetic guaranteed investment contracts
("synthetic GICs"), in which an investment contract is issued by an
insurance company or a financial services institution (Metropolitan Life
Insurance Company, Transamerica Premier Life Insurance Company and The
Prudential Insurance Company of America). The Plan measures the synthetic
GICs at contract value in the Plan's Interest in the Master Trust in the
Statements of Net Assets Available for Benefits. The synthetic GICs, which
are designed to help preserve principal and provide a stable crediting rate
of interest, are fully benefit-responsive and provide that participant
initiated withdrawals will be paid at contract value. The synthetic GICs are
primarily backed by a portfolio of fixed income investments, which are
effectively owned by the Plan. The assets underlying the synthetic GICs are
maintained by a third party custodian, separate from the contract issuer's
general assets. The synthetic GICs are obligated to provide an interest rate
not less than zero. These contracts provide that realized and unrealized
gains and losses of the underlying assets are not reflected immediately in
the assets of the fund, but rather are amortized, usually over the duration
of the underlying assets, through adjustments to the future interest
crediting rate. The future interest crediting rate can be adjusted
periodically and is primarily based on the current yield-to-maturity of the
covered investments, plus or minus amortization of the difference between
the market value and contract value of the covered investments over the
duration of the covered investments at the time of computation. The issuers
guarantee that all qualified participant withdrawals will occur at contract
value. There are no reserves against contract value for credit risks of the
contract issuers or otherwise.

Employer initiated events, if material, may affect the underlying economics
of the investment contracts. These events include plant closings, layoffs,
plan termination, bankruptcy or reorganization, merger, early retirement
incentive programs, tax disqualification of a trust or other events. The
occurrence of one or more employer initiated events could limit the Plan's
ability to transact at contract value with the issuers. Except for the
employer initiated events above, the synthetic GICs do not permit the
issuers to terminate the agreement prior to the scheduled maturity date at
an amount different from contract value. As of December 31, 2018, the
Company does not believe that the occurrence of an event that would limit
the ability of the Plan to transact at contract value with the issuers is
probable.

10

Fair Value Measurements

The guidance on fair value measurements defines fair value as the exchange
price that would be received for an asset or paid to transfer a liability
(an exit price) in the principal or most advantageous market for the asset
or liability in an orderly transaction between market participants. This
guidance also specifies a fair value hierarchy based upon the observability
of inputs used in valuation techniques. Observable inputs (highest level)
reflect market data obtained from independent sources, while unobservable
inputs (lowest level) reflect internally-developed market assumptions. In
accordance with this guidance, fair value measurements are classified under
the following hierarchy:

· Level 1 - Quoted prices for identical instruments in active markets.

· Level 2 - Quoted prices for similar instruments in active markets;
quoted prices for identical or similar instruments in markets that are not
active; and model-derived valuations in which all significant inputs or
significant value-drivers are observable in active markets.

· Level 3 - Model-derived valuations in which one or more significant
inputs or significant value-drivers are unobservable.

When available, quoted market prices are used to determine fair value and
such measurements are classified within Level 1. In some cases where market
prices are not available, observable market based inputs are used to
calculate fair value, in which case the measurements are classified within
Level 2. If quoted or observable market prices are not available, fair value
is based upon internally developed models that use, where possible, current
market-based parameters such as interest rates, yield curves and currency
rates. These measurements are classified within Level 3.

Fair value measurements are classified according to the lowest level input
or value-driver that is significant to the valuation. A measurement may
therefore be classified within Level 3 even though there may be significant
inputs that are readily observable.

The availability of observable market data is monitored to assess the
appropriate classification of financial instruments within the fair value
hierarchy. Changes in economic conditions or model-based valuation
techniques may require the transfer of financial instruments from one fair
value level to another. In such instances, the transfer is reported at the
end of the reporting period.

The significance of transfers between levels was evaluated based upon the
nature of the financial instrument and size of the transfer relative to
total net Master Trust assets. For the year ended December 31, 2018, there
were no significant transfers into or out of Levels 1, 2 or 3.


(MORE TO FOLLOW) Dow Jones Newswires

June 25, 2019 17:43 ET ( 21:43 GMT)
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WKN Bezeichnung Hebel
Long  DS8Z9J CATERPILLAR WaveXXL S 152 (DBK) 7,631
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