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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
(Mark One)
/X/ Annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 (No fee required, effective October 7, 1996)
For the fiscal year ended December 31, 2002
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Or
/X/ Transition report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 (No fee required)
For the transition period from to
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Commission file number 1-14946
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A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
CEMEX, Inc. Savings and Investment Plan
for Union Employees
1200 Smith Street
Suite 2400
Houston, Texas 77002
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
CEMEX,S.A. de C.V. Av. Ricardo Margain Zozaya #325 Colonia del
Valle Campestre Garza Garcia, Nuevo Leon
Mexico 66220
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CEMEX, INC. SAVINGS AND
INVESTMENT PLAN FOR
UNION EMPLOYEES
Financial Statements and
Supplemental Schedules
December 31, 2002 and 2001
(With Independent Auditors' Report Thereon)
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Table of Contents
Page
----
Independent Auditors' Report 1
Financial Statements:
Statements of Net Assets Available for Benefits -
December 31, 2002 and 2001 2
Statement of Changes in Net Assets Available for Benefits -
Year Ended December 31, 2002 3
Notes to Financial Statements 4
Supplemental Schedules:
Schedule H, Line 4(i) - Schedule of Assets (Held at End of Year) -
December 31, 2002 7
Schedule H, Line 4(j) - Schedule of Reportable Transactions -
Year Ended December 31, 2002 8
The following schedules required by the Department of Labor's Rules
and Regulations are omitted because of the absence of conditions under
which they are required:
Schedule H, Line 4(i) - Schedule of Assets (Acquired and Disposed of
Within the Plan Year)
Schedule G, Part I - Schedule of Loans on Fixed Income Obligations in
Default or Classified as Uncollectible
Schedule G, Part II - Schedule of Leases in Default or Classified as
Uncollectible
Schedule G, Part III - Nonexempt Transactions
INDEPENDENT AUDITORS' REPORT
----------------------------
Participants and Administrator of
CEMEX, Inc. Savings and Investment Plan
for Union Employees:
We have audited the accompanying statement of net assets available for benefits
of the CEMEX, Inc. Savings and Investment Plan for Union Employees (the Plan) as
of December 31, 2002, and the related statement of changes in net assets
available for benefits for the year then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit. The financial
statements of the Plan as of December 31, 2001 were audited by other auditors
whose report dated June 7, 2002 expressed an unqualified opinion on those
statements.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the 2002 financial statements referred to above present fairly,
in all material respects, the net assets available for benefits of the Plan as
of December 31, 2002, and the changes in net assets available for benefits for
the year then ended, in conformity with accounting principles generally accepted
in the United States of America.
Our audit was performed for the purpose of forming an opinion on the 2002 basic
financial statements taken as a whole. The supplemental schedules of assets
(held at end of year) and reportable transactions are presented for the purpose
of additional analysis and are not a required part of the basic financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. These supplemental schedules are the
responsibility of the Plan's management. The supplemental schedules have been
subjected to the auditing procedures applied in the audit of the basic financial
statements for 2002 and, in our opinion, are fairly stated in all material
respects in relation to the 2002 financial statements taken as a whole.
/s/ Mir Fox & Rodriguez
Houston, Texas
June 17, 2003
1
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Statements of Net Assets Available for Benefits
December 31, 2002 and 2001
Assets 2002 2001
------ ---- ----
Investments, at fair value:
Mutual funds $ 2,617,636
Common collective trust fund 1,543,188
Common stock 301,484
Participant loans 218,259 151,895
----------------- -------------
Total investments 4,680,567 151,895
Cash 23,512 3,563,312
Interest receivable 3,261
Contributions receivable 36,161
----------------- -------------
Total assets 4,704,079 3,754,629
Liabilities
Trades payable 23,468
----------------- -------------
Net assets available for benefits $ 4,680,611 3,754,629
================= =============
See accompanying notes to financial statements.
2
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 2002
Additions to net assets:
Participant contributions $ 947,186
Employer contributions 262,236
Investment income 147,579
Rollovers 3,355
-----------------
Total additions to net assets 1,360,356
-----------------
Deductions from net assets:
Net depreciation in fair value of mutual funds 359,975
Net depreciation in fair value of common stock 50,582
Benefits paid to participants 22,997
Administrative fees and expenses 820
-----------------
Total deductions from net assets 434,374
-----------------
Net increase in net assets available for benefits 925,982
Net assets available for benefits:
Beginning of year 3,754,629
-----------------
End of year $ 4,680,611
=================
See accompanying notes to financial statements.
3
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Notes to Financial Statements
December 31, 2002 and 2001
1. Plan Description
General
-------
The CEMEX, Inc. Savings and Investment Plan for Union Employees (formerly
Southdown Medusa Savings and Investment Plan for Union Employees) was
adopted effective August 1, 1998 for the benefit of the union employees of
the Clinchfied, Georgia and Charlevoix, Michigan plants of CEMEX, Inc.
(Union Employees). The Plan is qualified under section 401(a) of the
Internal Revenue Code (IRC) as a defined contribution plan and is subject
to the Employee Retirement Income Security Act of 1974, as amended (ERISA).
The following is provided for general information purposes only.
Participants should refer to the Plan Agreement for a more complete
description of the Plan's provisions.
Eligibility
-----------
Union Employees with at least three months of service are eligible to
participate in the Plan. Plan entry dates are the first day of the calendar
quarter coinciding with or following the completion of the service.
Contributions
-------------
Participants may contribute from 1% to 16% their eligible pay, up to an
annual maximum of the lesser of their eligible pay or $40,000. Participants
may also rollover certain amounts from other qualified defined benefit or
contribution plans. Participants direct the investment of their participant
contributions in the investment options listed in note 3.
CEMEX, Inc. (the Employer and Sponsor) matches 50% of the amount
contributed by each participant up to the first 6% (5% prior to May 1,
2002) of eligible pay. The Employer contributions are in the form of
American Depository Shares representing common stock of CEMEX, S.A. de C.V.
(CEMEX stock). Effective April 12, 2002, a participant may, at any time
after the CEMEX stock is credited to his or her account, make a
diversification election and exercise investment discretion with respect to
the Employer matching contribution. Prior to April 12, 2002, a participant
must have attained the age of 59 1/2 before exercising investment
discretion with respect to the CEMEX stock that was purchased with Employer
contributions. The Employer may make additional contributions in accordance
with the provisions of the Plan Agreement.
Participant accounts
--------------------
Separate accounts are maintained for each participant as follows.
Participant accounts are credited with the participant's contribution and
allocations of the Employer's contributions and Plan earnings. Allocations
are based on each participant's earnings or account balance, as defined in
the Plan Agreement. Each participant is entitled to the benefit that can be
provided from the participant's account.
Vesting
-------
Participants are immediately and fully vested in all contributions plus
actual earnings thereon.
4
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Notes to Financial Statements, Continued
Benefit payments
----------------
Benefits are payable from participant account balances, subject to certain
restrictions, upon termination of employment, retirement, reaching the age
of 59 1/2, or by incurring a disability or financial hardship, as defined
in the Plan Agreement. Participants elect the method of distribution which
may be either in the form of a direct rollover to an eligible retirement
plan, lump sum payment or, if in excess of $5,000, payment over a period of
time not to exceed the shorter of 10 years or certain life expectancies as
defined in the Plan Agreement. Benefits are recorded when paid.
Participant loans
-----------------
A participant may obtain a loan from his or her separate account balance.
Each loan is evidenced by a promissory note and may not be less than
$1,000. The loans are secured by the balance in the participant's account
and bear interest at the rate established by the Loan Committee. Provisions
of the Plan require the aggregate of each loan outstanding not to exceed
the lesser of $50,000 or 50% of the participant's vested account balance.
Repayment terms for loans are not to exceed five years and principal and
interest is paid ratably through monthly payroll deductions.
Administrative expenses
-----------------------
Asset management fees are paid by the Plan, loan fees are paid by the
borrowing participant, and all other administrative costs are paid by the
Sponsor.
Plan termination
----------------
Although no interest has been expressed, the Employer has the right under
the Plan to terminate the Plan subject to the provisions of ERISA.
2. Significant Accounting Policies
Basis of presentation
---------------------
The financial statements have been prepared on an accrual basis and present
the net assets available for plan benefits and changes in those net assets
in accordance with accounting principles generally accepted in the United
States of America. Benefit payments are recorded when paid.
Investment valuation and income recognition
-------------------------------------------
The mutual funds, common collective trust fund and common stock are stated
at fair value based on quoted market prices as of the date of the financial
statements. Participant loans are stated at cost, which approximates fair
value. Purchases and sales of securities are recorded on a trade-date
basis. Interest income is recorded on the accrual basis. Dividends are
recorded on the ex-dividend date.
Use of estimates
----------------
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, liabilities, and changes therein, and disclosure of
contingent assets and liabilities. Actual results could differ from those
estimates.
5
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Notes to Financial Statements, Continued
3. Investments
As of December 31, 2002, participant contributions to the Plan were
invested at the option of the participants in one or more of the following
investment funds:
Stable Value Fund $ 1,543,188
Washington Mutual Investors Fund 626,364
Bond Fund of America 552,098
MFS Research Fund 367,350
CEMEX stock 301,484
Templeton Foreign Fund 287,841
Franklin Balance Sheet Investment Fund 253,298
Franklin Real Estate Securities Fund 183,231
ING International Small Cap Growth Fund 107,296
Franklin Small Mid-Cap Growth Fund 74,150
Templeton Developing Markets Fund 66,878
Putnam New Opportunities Fund 55,434
Aim Constellation Fund 43,451
Alliance Capital Reserve Account 245
Participant loans 218,259
-------------
$ 4,680,567
=============
Investments with a fair value that exceeds $234,031 at December 31, 2002
represent 5% or more of Plan net assets as of December 31, 2002.
4. Significant Concentrations of Credit Risk
The Plan's cash in bank operating and trust accounts in excess of the
Federal Deposit Insurance Corporation insurance limit was $3,563,312 as of
December 31, 2001. The Plan's credit risk is mitigated by the financial
strength of the banking institutions in which the deposits are held.
5. Federal Income Tax Status
The Plan obtained its latest determination letter on June 14, 2002 in which
the Internal Revenue Service stated that the Plan, as then designed, was in
compliance with the applicable requirements of the IRC. The Plan's
management believes that the Plan is designed and is currently being
operated in compliance with the applicable requirements of the IRC.
Therefore, the Plan's management believes that the related trust is
tax-exempt and accordingly, no provision for Federal income taxes has been
included in the Plan's financial statements.
6. Risks and Uncertainties
The Plan provides for investment in various mutual funds, common collective
trust funds and common stock. Investment securities, in general, are
exposed to various risks, such as interest rate, credit and overall market
volatility risks. Due to the level of risk associated with certain
investment securities, it is reasonably possible that changes in the values
of investment securities will occur in the near term.
6
Supplemental Schedule H, Line 4(i)
Plan Sponsor No. 72-0296500
Plan No. 010
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Schedule of Assets (Held at End of Year)
December 31, 2002
(a) (b) (c)
Identity of issue, borrower, lessor, Description of investment including maturity date,
or similar party rate of interest, collateral, par or maturity value
------------------------------------------------------------- ---------------------------------------------------------
INVESCO Trust Company Stable Value Fund; 1,543,188 shares
Washington Mutual Washington Mutual Investors Fund; 26,642 shares
American Funds Bond Fund of America; 43,472 shares
MFS Fund Distributors, Inc. MFS Research Fund; 25,979 shares
* CEMEX, S.A. de S.V. American Depository Shares; 14,016 shares
Franklin Templeton Investor Services, Inc. Templeton Foreign Fund; 34,638 shares
Franklin Templeton Investor Services, Inc. Franklin Balance Sheet Investment Fund; 6,829 shares
Franklin Templeton Investor Services, Inc. Franklin Real Estate Securities Fund; 11,367 shares
ING Pilgrim Group ING International Small Cap Growth Fund; 5,725 shares
Franklin Templeton Investor Services, Inc. Franklin Small Mid-Cap Growth Fund; 3,378 shares
Franklin Templeton Investor Services, Inc. Templeton Developing Markets Fund; 6,688 shares
Putnam Investments Putnam New Opportunities Fund; 1,950 shares
AIM Family of Funds AIM Constellation Fund; 2,613 shares
Pershing Alliance Capital Reserve Account; 245 shares
* Participant loans 6.00% to 9.50%; 1-5 year term; payable monthly
* Party-in-interest
(table continued)
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Schedule of Assets (Held at End of Year)
December 31, 2002
(a) (b) (e)
Identity of issue, borrower, lessor, Current
or similar party value
---------------------------------------------------- -------------------
INVESCO Trust Company $ 1,543,188
Washington Mutual 626,364
American Funds 552,098
MFS Fund Distributors, Inc. 367,350
* CEMEX, S.A. de S.V. 301,484
Franklin Templeton Investor Services, Inc. 287,841
Franklin Templeton Investor Services, Inc. 253,298
Franklin Templeton Investor Services, Inc. 183,231
ING Pilgrim Group 107,296
Franklin Templeton Investor Services, Inc. 74,150
Franklin Templeton Investor Services, Inc. 66,878
Putnam Investments 55,434
AIM Family of Funds 43,451
Pershing 245
* Participant loans 218,259
----------------
$ 4,680,567
================
* Party-in-interest
7
Supplemental Schedule H, Line
4(j)
Plan Sponsor No. 72-0296500
Plan No. 010
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
Schedule of Reportable Transactions
Cumulative Transactions by Issue
Year Ended December 31, 2002
(b) (d)
(a) Description of asset (include interest rate (c) Selling Lease
Identity of party involved and maturity in case of a loan) Purchase price price Rental
- -------------------------------- ----------------------------------------------- ------------------- ------------ ----------
CEMEX, S.A. de S.V. American Depository Shares $ 261,991 n/a n/a
(table continued)
(f) (g) (h)
Expenses Current value of (i)
(a) incurred with asset on Net gain or
Identity of party involved transaction Cost of asset transaction date (loss)
- -------------------------------- --------------- -------------- ------------------- -------------------
CEMEX, S.A. de S.V. n/a 261,991 261,991 n/a
8
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act
of 1934, the trustees (or other persons who administer the employee benefit
plans) have duly caused this annual report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CEMEX, INC. SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES
By: /s/ Andrew M. Miller
-------------------------------------------
Name: Andrew M. Miller
Title: Chairman of Administrative Committee
Date: June 30, 2003
EXHIBIT INDEX
Exhibit
No. Description
1. Certification of Plan Administrator of the CEMEX,
Inc. Savings and Investment Plan For Union Employees
pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
2. Consent of Mir Fox & Rodriguez, P.C. to the
incorporation by reference into the Registration
Statement on Form S-8 (File No. 333-86090) of CEMEX,
S.A. de C.V. of its report, dated June 17, 2003, with
respect to the audited financial statements of the
CEMEX, Inc. Savings and Investment Plan For Union
Employees as of December 31, 2002.
EXHIBIT 1
Certification of Plan Administrator
Pursuant to 18 U.S.C. Section 1350,
as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the Annual Report on Form 11-K of the CEMEX, Inc. Savings and
Investment Plan For Union Employees (the "Plan") for the year ended December 31,
2002 as filed with the Securities and Exchange Commission on the date hereof
(the "Report"), Andrew M. Miller, as Chairman of the Administrative Committee of
the Plan, hereby certifies, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant
to ss. 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his
knowledge:
(1) The Report fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Plan.
/s/ Andrew M. Miller
- ----------------------------------
Name: Andrew M. Miller
Title: Chairman of Administrative
Committee
Date: June 30, 2003
This certification accompanies the Report pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the
Sarbanes-Oxley Act of 2002, be deemed filed by the Plan for purposes of ss.18 of
the Securities Exchange Act of 1934, as amended.
A signed original of this written statement required by Section 906 has been
provided to the Plan and will be retained by the Plan and furnished to the
Securities and Exchange Commission or its staff upon request.
EXHIBIT 2
CONSENT OF INDEPENDENT AUDITORS
As independent auditors, we hereby consent to the incorporation by reference
of our report dated June 17, 2003, included in this Form 11-K, into the
previously filed registration statement of CEMEX, Inc. Savings and Investment
Plan For Union Employees, on Form S-8 (File No. 333-86090).
/s/ Mir Fox & Rodriguez
Houston, Texas
June 30, 2003