As filed with the Securities and Exchange Commission on August 27, 2003
Registration No. 333-11382
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------------
POST-EFFECTIVE AMENDMENT NO. 4
TO
FORM F-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
----------------------------------------
CEMEX, S.A. de C.V.
(Exact name of registrant as specified in its charter)
United Mexican States 3241 N.A.
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
----------------------------------------
CEMEX, S.A. de C.V.
Av. Ricardo Margain Zozaya #325
Colonia Valle del Campestre
Garza Garcia, Nuevo Leon
Mexico 66265
Tel: (011-5281) 8888-8888
(Address and Telephone Number of Registrant's Principal Executive Offices)
----------------------------------------
CEMEX Corp.
1200 Smith Street, Suite 2400
Houston, Texas 77002
(713) 650-6200
Attn: Gilberto Perez
(Name, Address and Telephone Number of Agent for Service)
Copy of all communications, including communications
sent to the agent for service, to:
Robert M. Chilstrom, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, NY 10036
----------------------------------------
Approximate date of commencement of proposed sale to the public: At such time
or times as the selling ADS holders may determine.
If the only securities being registered on this form are to be offered
pursuant to dividend or interest reinvestment plans, please check the
following box. |_|
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, please check the following box. |X|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_| ____________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_| ____________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
----------------------------------------
The Registrant hereby amends this Post-Effective Amendment to the Registration
Statement on such date or dates as may be necessary to delay its effective
date until the Registrant shall file a further amendment which specifically
states that this Post-Effective Amendment to the Registration Statement shall
thereafter become effective in accordance with Section 8(a) of the Securities
Act of 1933 or until the Post-Effective Amendment to the Registration
Statement shall become effective on such date as the Securities and Exchange
Commission, acting pursuant to said Section 8(a), may determine.
===============================================================================
EXPLANATORY NOTE
The prospectus which forms a part of this Post-Effective Amendment to
the Registration Statement relates to the offering and sale, from time to time,
by the selling ADS holders named herein of up to 25,457,378 American Depositary
Shares, or ADSs, each representing five Ordinary Participation Certificates, or
CPOs, of CEMEX, S.A. de C.V. The number of ADSs originally registered for resale
under this Registration Statement was 21,000,000 ADSs; however, as a result of
stock dividends received by the selling ADS holders in respect of such ADSs, the
number of ADSs which may be sold by them under this Registration Statement has
increased to 25,457,378 ADSs. In addition, the prospectus has been updated to
reflect the new forward transactions entered into with the selling ADS holders
in December 2002 upon the termination of the original forward transactions
pursuant to which the selling ADS holders initially acquired the ADSs that may
be sold hereunder and to reflect other updated information relating to CEMEX,
S.A. de C.V.
PROSPECTUS
[graphical logo omitted]
CEMEX, S.A. de C.V.
25,457,378 American Depositary Shares
Each Representing Five
Ordinary Participation Certificates
---------------------------------
This prospectus relates to the public offering and sale, from time to
time, of up to 25,457,378 American Depositary Shares, or ADSs, each representing
five Ordinary Participation Certificates, or CPOs, of CEMEX by the selling ADS
holders. The ADSs are evidenced by American Depositary Receipts, or ADRs.
The selling ADS holders may sell at any time and from time to time all
or a portion of the ADSs held by them.
We will provide the specific terms of any offering of our ADSs by the
selling ADS holders in supplements to this prospectus. You should read this
prospectus and the accompanying prospectus supplement carefully before you
decide to invest in our ADSs and the underlying CPOs.
Our ADSs are listed on the New York Stock Exchange under the symbol
"CX" and our CPOs are listed on the Mexican Stock Exchange under the symbol
"CEMEX.CPO."
You should consider the risk factors beginning on page 7 before making
an investment decision with respect to our ADSs and the underlying CPOs.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus or the accompanying prospectus supplement is truthful or complete.
Any representation to the contrary is a criminal offense.
This prospectus may not be used to sell securities unless accompanied by a
prospectus supplement.
The date of this prospectus is August 27, 2003.
TABLE OF CONTENTS
Page
No.
---
About This Prospectus.................................................... 1
Where You Can Find More Information...................................... 1
Incorporation by Reference............................................... 1
Cautionary Statement Regarding Forward-Looking Statements................ 2
The Offering............................................................. 3
CEMEX, S.A. de C.V....................................................... 5
Risk Factors............................................................. 7
Use of Proceeds.......................................................... 12
Selling ADS Holders...................................................... 13
Description of Our Common Stock.......................................... 14
Description of Our CPOs.................................................. 21
Description of Our ADSs.................................................. 25
Income Tax Considerations................................................ 34
Plan of Distribution..................................................... 38
Validity of the Securities............................................... 39
Experts.................................................................. 39
Neither we nor the selling ADS holders have authorized any dealer,
salesperson or other person to give any information or to make any
representations other than those contained or incorporated by reference in this
prospectus and any accompanying prospectus supplement. You should not rely on
any unauthorized information. This prospectus and any accompanying prospectus
supplement do not offer to sell or buy any securities in any jurisdiction in
which it is unlawful. The information in this prospectus is current as of the
date on the cover.
References in this prospectus to "CEMEX," "we," "us" or "our" refer to
CEMEX, S.A. de C.V., a Mexican corporation, and its consolidated subsidiaries.
References in this prospectus to "U.S.$" and "Dollars" are to U.S.
Dollars, and, unless otherwise indicated, references to "Ps" and "Pesos" are to
constant Mexican Pesos as of December 31, 2002. Unless otherwise indicated, the
Dollar amounts provided in this prospectus are translations of constant Peso
amounts, at an exchange rate of Ps10.38 to U.S.$1.00, the CEMEX accounting rate
as of December 31, 2002. However, in the case of transactions conducted in
Dollars, we have presented the Dollar amount of the transaction and the
corresponding Peso amount that is presented in our consolidated financial
statements. These translations have been prepared solely for the convenience of
the reader and should not be construed as representations that the Peso amounts
actually represent those Dollar amounts or could be converted into Dollars at
the rate indicated. The noon buying rate for Pesos on December 31, 2002 was
Ps10.425 to U.S.$1.00.
The CPOs underlying the ADSs being sold pursuant to this prospectus
have been registered with the Securities and Special Sections of the National
Securities Registry (Registro Nacional de Valores) maintained by the Mexican
National Banking and Securities Commission (Comision Nacional Bancaria y de
Valores), or the CNBV. Registration of the CPOs with the Securities and Special
Sections of the National Securities Registry maintained by the CNBV does not
imply any certification as to the investment quality of the CPOs, the solvency
of CEMEX or the accuracy or completeness of the information contained in this
prospectus.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with
the Securities and Exchange Commission, or SEC, using a "shelf" registration
process. Under this shelf process, the selling ADS holders may sell the ADSs
held by them in one or more offerings in any manner described under the section
in this prospectus entitled "Plan of Distribution." This prospectus provides you
with a general description of our ADSs and the underlying CPOs. Each time any of
the selling ADS holders sells securities, we will provide a prospectus
supplement that will contain specific information about the terms of that
offering by the selling ADS holders and the manner in which the ADSs will be
offered. The prospectus supplement may also add, update, or change information
contained in this prospectus. You should read both this prospectus and any
prospectus supplement together with additional information described under the
headings "Where You Can Find More Information" and "Incorporation by Reference."
WHERE YOU CAN FIND MORE INFORMATION
We file reports, including annual reports on Form 20-F, and other
information with the SEC pursuant to the rules and regulations of the SEC that
apply to foreign private issuers. You may read and copy any materials filed with
the SEC at its Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20459. You may obtain information on the operation of the Public Reference Room
by calling the SEC at 1-800-SEC-0330. Our ADSs are listed on the New York Stock
Exchange under the symbol "CX." These reports and other information can also be
read at the offices of the New York Stock Exchange, 20 Broad Street, New York,
New York 10005.
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" information into this
prospectus. This means that we can disclose important information to you by
referring you to another document filed by us with the SEC. Any information
referenced this way is considered part of this prospectus, and any information
that we file after the date of this prospectus with the SEC will automatically
update and supersede this information. We incorporate by reference into this
prospectus the following documents:
o Our annual report on Form 20-F for the year ended December 31,
2002, filed with the SEC on April 8, 2003 and Amendment No. 1
thereto on Form 20-F/A, filed with the SEC on April 25, 2003;
o Our current report on Form 6-K furnished to the SEC on August 25,
2003; and
o The descriptions of our ADSs, CPOs, series A shares and series B
shares contained in our registration statement on Form 8-A (SEC
File No. 1-14946), filed with the SEC on September 10, 1999, and
any amendment or report filed for the purpose of updating such
descriptions.
In addition, any future filings on Form 20-F made with the SEC under
the Securities Exchange Act of 1934, as amended, after the date of this
prospectus and prior to the termination of the offering of the ADSs, and any
future reports on Form 6-K furnished by us to the SEC during such period or
portions thereof that are identified in such forms as being incorporated into
the registration statement of which this prospectus forms a part, shall be
considered to be incorporated in this prospectus by reference and shall be
considered a part of this prospectus from the date of filing of such
documents.
We will provide without charge upon written or oral request, a copy of
any and all of the information that has been incorporated by reference in this
prospectus and that has not been delivered with this prospectus. Requests should
be directed to Abraham Rodriguez, Investor Relations, CEMEX, S.A. de C.V., Av.
Ricardo Margain Zozaya #325, Colonia Valle del Campestre, Garza Garcia, Nuevo
Leon, Mexico 66265, Tel: +011-5281-8888-4262 or toll-free: 1-800-317-6000.
1
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Some of the information contained or incorporated by reference in this
prospectus and any accompanying prospectus supplement may constitute
forward-looking statements, which are subject to various risks and
uncertainties. Such statements can be identified by the use of forward-looking
terminology such as "may," "will," "expect," "anticipate," "estimate,"
"continue," "plan" or other similar words. These statements discuss future
expectations, contain projections of results of operations or of financial
condition or state other "forward-looking" information. We make these
forward-looking statements in reliance on the safe harbor protections provided
under the Private Securities Litigation Reform Act of 1995. Although we believe
these forward-looking statements are based on reasonable assumptions, statements
made regarding future results are subject to a number of assumptions,
uncertainties and risks that could cause future results to be materially
different from the results stated or implied in this prospectus and any
accompanying prospectus supplement. When considering such forward-looking
statements, you should keep in mind the factors described in "Risk Factors"
appearing elsewhere in this prospectus. Additional information about issues that
could lead to material changes in our performance is contained in our annual
report on Form 20-F for the year ended December 31, 2002, which is incorporated
by reference in this prospectus.
This prospectus and the documents incorporated in this prospectus by
reference also include statistical data regarding the production, distribution,
marketing and sale of cement, ready-mix concrete and clinker. These data were
obtained from industry publications and reports that we believe to be reliable
sources. We have not independently verified these data or sought the consent of
any organizations to refer to their reports in this prospectus and in the
documents incorporated in this prospectus by reference.
2
THE OFFERING
As discussed below, the ADSs that may be sold hereunder were initially
acquired by the selling ADS holders pursuant to forward transactions we entered
into with a number of banks and other financial institutions in December 1999 in
order to hedge our obligations under appreciation warrants we issued at that
time and as a result of stock dividends subsequently received by the selling ADS
holders in respect of those ADSs. In connection with the originally scheduled
termination of those forward transactions in December 2002, we agreed with the
banks to settle those forward transactions for cash and simultaneously entered
into new forward transactions, with a December 2003 maturity, with the same
banks with respect to the underlying ADSs on similar terms to the original
forward transactions, as described below. As a condition of entering into
forward contracts, we agreed to keep continuously effective a registration
statement, of which this prospectus is a part, that registers for resale by the
banks these ADSs. We sometimes refer to the banks or others holding the ADSs
that are registered for resale under the registration statement as the selling
ADS holders.
Background and Purpose of the Offering
In December 1999, we issued to our shareholders, members of our board
of directors and other executives 105 million appreciation warrants maturing on
December 13, 2002, at a subscription price in pesos of Ps3.2808 per appreciation
warrant. A portion of the appreciation warrants was subscribed as American
Depositary Warrants, or ADWs, each ADW representing five appreciation warrants.
In November 2001, we launched a voluntary public exchange offer of new
appreciation warrants and new ADWs maturing on December 21, 2004, for our
existing appreciation warrants and our existing ADWs on a one-for-one basis. Of
the total 105 million appreciation warrants originally issued, 103,790,945, or
98.85%, were tendered in exchange for the new appreciation warrants. Both the
old appreciation warrants and the new appreciation warrants were designed to
allow the holder to benefit from future increases in the market price of our
CPOs, with any appreciation value to be received in the form of our CPOs or
ADSs, as applicable. The old appreciation warrants expired on December 13, 2002
in accordance with their terms without any payments to the holders.
In order to cover our obligations under the old appreciation warrants
and to provide us with financing on terms we believe have been advantageous, in
December 1999, we entered into forward contracts with a number of banks and
other financial institutions. Under the forward contracts, the banks purchased
from us 21,000,000 of our ADSs and 33,751,566 shares of the common stock of
Compania Valenciana de Cementos Portland, S.A., now known as CEMEX Espana, S.A.
or CEMEX Espana, our Spanish subsidiary, for an aggregate price of approximately
U.S.$905.7 million, or the notional amount. Upon closing of these forward
transactions, we made an advance payment to the banks of approximately
U.S.$439.9 million of the forward purchase price, U.S.$388.1 million of which
represented payment in full of the portion of the forward purchase price
relating to the CEMEX Espana shares and U.S.$51.8 million of which was an
advance payment against the forward settlement price. We made additional advance
payments to the banks toward the forward settlement price during the life of the
forward contracts in accordance with their terms, and as of December 12, 2002,
the adjusted forward settlement price was U.S.$469.3 million.
On December 13, 2002, the termination date of those forward contracts,
we agreed with the banks to settle the original forward transactions for cash
and simultaneously enter into new forward transactions with the same banks on
similar terms to the original forward transactions with respect to the
underlying ADSs and CEMEX Espana shares, with a December 12, 2003 maturity. In
connection with the termination of the original forward contracts, we made a
final advance payment of approximately U.S.$20.9 million to the banks toward the
forward settlement price, and as of the termination date, the adjusted forward
settlement price of the original forward contracts was U.S.$448.4 million. Under
the new forward contracts, the banks retained the ADSs underlying the original
forward contracts, which had increased to 24,008,313 ADSs as of the termination
date as a result of stock dividends, and the CEMEX Espana shares underlying the
original forward contracts, for which they agreed to pay us an aggregate price
of approximately U.S.$828.5 million, or the notional amount of the new forward
contracts. We agreed with the banks that the purchase price payable to us under
the new forward contracts would be netted against the adjusted forward
settlement price of the original forward contracts and any advance payments made
by us in connection with the closing of the new forward contracts. Upon closing
of the new forward transactions, we made an advance payment to the banks of
approximately U.S.$380.1 million of the forward purchase price, U.S.$285 million
3
of which represented payment in full of the portion of the forward purchase
price relating to the CEMEX Espana shares and U.S.$95.1 million of which was an
advance payment against the forward settlement price. As of December 13, 2002,
the forward purchase price of the new forward contracts was U.S.$448.4 million.
Absent a default under the forward contracts, the banks are required to
deliver to us on December 12, 2003 a number of ADSs and CEMEX Espana shares
equal to the number of ADSs and CEMEX Espana shares subject to the forward
contracts against payment of the adjusted forward settlement price. As a result
of stock dividends through June 2003, the number of ADSs subject to the forward
contracts increased to 25,457,378 ADSs. The forward purchase price payable at
any time under the forward contracts is the present value of the adjusted
forward settlement price. The adjusted forward settlement price is the future
value of the notional amount minus the future value of all prepayments under the
forward contracts. The forward contracts provide for early delivery of ADSs and
CEMEX Espana shares to us in specified circumstances. We are required to make
payments during the life of the forward contracts and upon the occurrence of
specified events. During the life of the forward contracts, we are required to
make additional periodic prepayments if the current market value of the ADSs and
CEMEX Espana shares subject to the contracts is less than 120% of the
mark-to-market of the discounted remaining forward purchase price.
Under the forward contracts, the banks are permitted to sell at any
time or from time to time all or a portion of the purchased ADSs and the
purchased CEMEX Espana shares. In particular, we anticipate that the banks would
sell ADSs and CEMEX Espana shares if we were to default on any of our
obligations under the forward contracts. In the absence of a default under the
forward contracts, the banks have agreed to pay to us an amount equal to any
dividends paid on the purchased ADSs upon the maturity or early termination of
the forward contracts. In addition, absent a default under the forward
contracts, we retain all voting and economic rights with respect to the CEMEX
Espana shares purchased by the banks. Notwithstanding any contractual agreement
between the banks and us, any person that purchases ADSs from the banks will be
entitled to all dividend, voting, economic and corporate rights with respect to
the ADSs purchased by them.
As mentioned above, as a condition of entering into the forward
contracts, we agreed to keep continuously effective a registration statement, of
which this prospectus is a part, that registers for resale by the banks the ADSs
covered by the forward transactions. The banks may sell at any time or from time
to time all or a portion of the ADSs pursuant to the registration statement.
We may agree with the selling ADS holders to settle the forward
transactions for cash, and the selling ADS holders may sell all or a portion of
the ADSs pursuant to the registration statement, of which this prospectus is a
part, in order to pay us the cash settlement amount, if any, payable in
connection with such agreement. If the forward transactions are settled for
cash, we may receive a portion of the proceeds from the sale of ADSs pursuant to
this prospectus to the extent such proceeds exceed the amount necessary to
satisfy our obligations under the forward contracts. In addition, we may
facilitate offers and sales of the ADSs by the selling ADS holders either
directly to purchasers or through an underwritten offering, in which case we may
be a party to the purchase agreement or underwriting agreement relating to such
offers and sales. We may also arrange for the selling ADS holders to sell a
portion of the ADSs to banks or other financial institutions in connection with
new forward transactions or to a trust in order to hedge our obligations under
the new appreciation warrants. In the event any selling ADS holder sells a
portion of the ADSs to such new bank or trust, such new bank or trust may resell
such ADSs under this registration statement from time to time, in one or more
offerings, pursuant to an appropriate prospectus supplement.
For accounting purposes under Mexican GAAP, whether we settle the
forward transactions for cash or physically by repurchasing the ADSs, the
portions of the forward contracts relating to our ADSs are considered to be
equity transactions. Therefore, changes in the fair value of the ADSs have not
been and will not be recorded until settlement and the cost of the forward
contracts relating to our ADSs will be recorded as a decrease in stockholders'
equity. With respect to the portion of the forward contracts relating to CEMEX
Espana shares, our obligations to the banks relating to those shares have been
offset on our balance sheet against the portion of the forward purchase price
that we prepaid to the banks.
Although our obligations under the forward contracts are not treated as
debt on our balance sheet under Mexican GAAP, our obligations under the forward
contracts are included as debt in the calculation of our debt to total
capitalization ratio covenants contained in our principal financing agreements.
4
CEMEX, S.A. DE C.V.
Founded in 1906, CEMEX is the third largest cement company in the
world, based on installed capacity as of December 31, 2002 of approximately 80.9
million tons. We are one of the world's largest traders of cement and clinker,
having traded over 10.2 million tons of cement and clinker in 2002. We are a
holding company engaged, through our operating subsidiaries, primarily in the
production, distribution, marketing and sale of cement, ready-mix concrete and
clinker. We are a global cement manufacturer with operations in North, Central
and South America, Europe, the Caribbean, Asia and Africa. As of December 31,
2002, we had worldwide assets of Ps165.4 billion (U.S.$15.9 billion). On August
15, 2003, we had an equity market capitalization of approximately Ps82 billion
(U.S.$7.6 billion).
We believe that we are one of the most efficient cement producers in
the world. We believe we have achieved this competitive advantage through our
significant utilization of technology throughout our entire organization, our
superior operating practices, our turnaround expertise in newly acquired
operations and our size as one of the largest cement companies in the world.
As of December 31, 2002, our main cement production facilities were
located in Mexico, Spain, Venezuela, Colombia, the United States, Egypt, the
Philippines, Thailand, Costa Rica, the Dominican Republic, Panama, Nicaragua and
Puerto Rico. As of December 31, 2002, our assets, cement plants and installed
capacity, on an unconsolidated basis, were as set forth below. Installed
capacity, which refers to theoretical annual production capacity, represents
gray cement equivalent capacity, which counts each ton of white cement capacity
as approximately two tons of gray cement capacity. It also includes our
proportional interest in the installed capacity of companies in which we hold a
minority interest.
As of December 31, 2002
-----------------------------------------------
Assets Installed
(in billions Number of Capacity
of constant Cement (millions of
Pesos) Plants tons per annum)
------------------------------------------------
North America
Mexico................................................. Ps 57.0 15 27.2
United States.......................................... 44.7 12 13.6
Europe, Asia and Africa
Spain.................................................. 21.5 8 10.8
Asia................................................... 12.1 4 10.9
Egypt.................................................. 5.7 1 4.7
South America, Central America and the Caribbean
Venezuela.............................................. 7.9 3 4.6
Colombia............................................... 6.0 5 4.8
Central America and the Caribbean...................... 10.7 5 4.1
Cement and Clinker Trading Assets and Other Operations...... 71.9 -- --
In the above table, "Asia" includes our Asian subsidiaries, and, for
purposes of the columns labeled "Assets" and "Installed Capacity," includes our
25.5% interest, as of December 31, 2002, in PT Semen Gresik, or Gresik, an
Indonesian cement producer. In addition to the three cement plants owned by our
Asian subsidiaries, Gresik operated four cement plants with an installed
capacity of 17.2 million tons, as of December 31, 2002. In the above table,
"Central America and the Caribbean" includes our subsidiaries in Costa Rica, the
Dominican Republic, Panama, Nicaragua, Puerto Rico and other assets in the
Caribbean region. In the above table, "Cement and Clinker Trading Assets and
Other Operations" includes in the column labeled "Assets" our 11.9% interest in
Cementos Bio Bio, a Chilean cement producer having three cement plants with an
installed capacity of approximately 2.2 million tons at December 31, 2002, and
intercompany accounts receivable of CEMEX (the parent company only) in the
amount of Ps33.9 billion, which would be eliminated if these assets were
calculated on a consolidated basis.
5
During the last decade, we embarked on a major geographic expansion
program to diversify our cash flows and enter markets whose economic cycles
within the cement industry largely operate independently from that of Mexico and
which offer long-term growth potential. We have built an extensive network of
marine and land-based distribution centers and terminals that give us marketing
access around the world.
For the year ended December 31, 2002, our net sales, before
eliminations resulting from consolidation, were divided among the countries in
which we operate as follows:
[pie chart omitted]
Mexico 35.0%
United States 26.0%
Spain 10.0%
Venezuela 6.0%
Colombia 3.0%
Central America and the Caribbean 6.0%
Philippines 2.0%
Egypt 2.0%
Others 10.0%
Executive Offices
We are a Mexican corporation with our principal executive offices
located at Av. Ricardo Margain Zozaya #325, Colonia Valle del Campestre, Garza
Garcia, Nuevo Leon, Mexico 66265. Our main phone number is +011-5281-8888-8888.
6
RISK FACTORS
You should carefully consider the following risks and all the
information contained or incorporated by reference in this prospectus before
making an investment decision regarding our securities. The following risks are
not the only risks we face.
Risks Relating to our ADSs
Any sale of the ADSs by the selling ADS holders, or market anticipation of a
sale, could cause the price of our CPOs and ADSs to decline.
Under the forward contracts, the selling ADS holders purchased the ADSs
from us. A sale of these ADSs to the public could result in a decline in the
market price of our CPOs and ADSs. In addition, market anticipation of a sale of
ADSs by any of the selling ADS holders may cause the market price of our ADSs to
decline. The selling ADS holders also have the right to sell the CEMEX Espana
shares sold to them under the forward contracts, and a sale of those CEMEX
Espana shares could also cause a decline in the market price of our CPOs and
ADSs.
Preemptive rights may be unavailable to ADS holders.
ADS holders may be unable to exercise preemptive rights granted to our
shareholders, in which case ADS holders could be substantially diluted. Under
Mexican law, whenever we issue new shares for payment in cash or in kind, we
are required to grant preemptive rights to our shareholders. However, ADS
holders may not be able to exercise these preemptive rights to acquire new
shares unless both the rights and the new shares are registered in the United
States or an exemption from registration is available.
We cannot assure you that we would file a registration statement in the
United States at the time of any rights offering. In addition, while the
depositary is permitted, if lawful and feasible at that time, to sell those
rights and distribute the proceeds of that sale to ADS holders who are entitled
to those rights, current Mexican law does not permit sales of that kind.
Risks Relating to Our Business
Our ability to pay dividends and repay debt depends on our subsidiaries' ability
to transfer income and dividends to us.
We are a holding company with no significant assets other than the
stock of our wholly-owned and non-wholly-owned subsidiaries and our holdings of
cash and marketable securities. Our ability to pay dividends and repay debt
depends on the continued transfer to us of dividends and other income from our
wholly-owned and non-wholly-owned subsidiaries. The ability of our subsidiaries
to pay dividends and make other transfers to us is limited by various
regulatory, contractual and legal constraints that affect our subsidiaries.
We have incurred and will continue to incur debt, which could have an adverse
effect on the price of our CPOs and ADSs, result in us incurring increased
interest costs and limit our ability to distribute dividends, finance
acquisitions and expansions and maintain flexibility in managing our business
activities.
We have incurred and will continue to incur significant amounts of
debt, which could have an adverse effect on the price of our CPOs and ADSs. Our
indebtedness may have important consequences, including increased interest costs
if we are unable to refinance existing indebtedness on satisfactory terms. In
addition, the debt instruments governing a substantial portion of our
indebtedness contain various covenants which require us to maintain financial
ratios, restrict asset sales and restrict our ability to use the proceeds from a
sale of assets. Consequently, our ability to distribute dividends, finance
acquisitions and expansions and maintain flexibility in managing our business
activities could be limited. As of December 31, 2002, we had outstanding debt
equal to Ps59.9 billion (U.S.$5.77 billion), not including obligations under
preferred stock transactions and under equity derivative transactions in our own
stock and in stock of our subsidiaries.
We have to service our Dollar and Yen denominated debt with revenues generated
in Pesos or other currencies, as we do not generate sufficient revenue in
Dollars and Yen from our operations to service all our Dollar and Yen
7
denominated debt. This could adversely affect our ability to service our
debt in the event of a devaluation or depreciation in the value of the Peso or
of any of the other currencies of the countries in which we operate.
A substantial portion of our outstanding debt is denominated in Dollars
and Yen. This debt, however, must be serviced by funds generated from sales by
our subsidiaries. Currently, we do not generate sufficient revenue in Dollars
and Yen from our operations to service all our Dollar and Yen denominated debt.
Consequently, we have to pay our Dollar and Yen denominated debt with revenues
generated in Pesos or other currencies. A devaluation or depreciation in the
value of the Peso, or any of the other currencies of the countries in which we
operate, compared to the Dollar or the Yen could adversely affect our ability to
service our debt. During 2002, Mexico and Spain, our main non-U.S. Dollar
denominated operations, generated almost half of our sales (approximately 34%
and 14%, respectively), before eliminations resulting from consolidation. In
2002, approximately 24% of our sales were generated in the United States with
the remaining 28% of our sales being generated in several countries, with a
number of currencies also having material depreciations against the Dollar and
the Yen. During 2002, the Peso depreciated 13.2% against the Dollar and
depreciated 20.2% against the Yen, while the Euro appreciated 16.1% against the
Dollar and appreciated 7.6% against the Yen.
We may not be able to continue our growth if our acquisition strategy is not
successful.
A key element of our growth strategy is to integrate our recently
acquired operations with existing operations. Our ability to realize the
expected benefits from future acquisitions depends, in large part, on our
ability to integrate the new operations with existing operations in a timely and
effective manner. We cannot assure you that these efforts will be successful
with respect to future acquisitions by us. Furthermore, our strategy depends on
our ability to identify and acquire suitable assets at desirable prices. We
cannot assure you that we will be successful in identifying or purchasing
suitable assets in the future. If we fail to make further acquisitions, we may
not be able to continue to grow in the long term at our historic rate.
We are subject to restrictions due to minority interests in our consolidated
subsidiaries.
We conduct our business through subsidiaries. In some cases,
third-party shareholders hold minority interests in these subsidiaries. Various
disadvantages may result from the participation of minority shareholders whose
interests may not always coincide with ours. Some of these disadvantages may,
among other things, result in our inability to implement organizational
efficiencies and transfer cash and assets from one subsidiary to another in
order to allocate assets most effectively.
Our derivative instruments and other financing arrangements may have adverse
effects on the market for our securities and some of our subsidiaries'
securities, and may adversely affect our ability to achieve operating
efficiencies as a combined group.
In recent years, we have entered into several derivative instruments
and engaged in other financing transactions involving shares of our capital
stock and shares of capital stock of some of our subsidiaries under equity
forward contracts as a source of financing and as a means of meeting our
obligations that may require us to deliver significant numbers of shares of our
own stock.
We have equity forward agreements in our own stock, the estimated
fair value of which is linked to the market price of our CPOs or ADSs. As of
December 31, 2002, the notional amount of our outstanding obligations under
our equity forward contracts was approximately U.S.$1.4 billion, with an
estimated fair value loss of U.S.$90.6 million. In addition to the estimated
fair value loss of our equity forward agreements, a portion of which
corresponds to the contracts designated as hedges of our stock option programs
which are periodically recorded in our income statements, during 2002 we had
losses amounting approximately to U.S.$98.3 million (Ps1,020.3 million)
resulting from the net settlement in connection to the new forward
transactions entered to cover our obligations under our appreciation warrants.
The decline in the estimated fair value of our equity forward contracts is due
to a decrease in the market price of our listed securities (ADSs and CPOs).
Pursuant to the terms of our equity forward contracts, if the shares
underlying our equity forward agreements suffer a substantial decrease in
market value, we could be required to compensate for the decrease in market
value. If we default in this obligation, the counterparties to our equity
forward agreements have the option of either selling the underlying shares to
the market or requiring us to repurchase the underlying shares.
8
As of December 31, 2002, U.S.$650 million was outstanding under a
preferred equity financing arrangement, which is payable in two tranches in
February 2004 and August 2004. Under the terms of the preferred equity financing
arrangement, our subsidiary New Sunward Holding B.V. may be liquidated if we do
not repurchase the preferred equity, or if we do not make payments on the
preferred equity and in other adverse circumstances. Any such liquidation would
include the sale of its assets (mainly the CEMEX Espana shares it holds) at
market prices in an amount sufficient to satisfy the liquidation preference of
the preferred equity.
As stated above, if we default on the terms of our equity forward or
preferred equity agreements, our counterparties may sell the shares underlying
these agreements, which may:
o dilute shareholders' interests in our equity securities;
o have an adverse effect on the market for our equity securities;
o have an adverse effect on the market for the equity securities of
some of our subsidiaries;
o reduce the amount of dividends and other distributions that we
receive from our subsidiaries;
o create public minority interests in our subsidiaries that may
adversely affect our ability to realize operating efficiencies as
a combined group; and
o have an adverse effect on other financing agreements.
Any of these factors could adversely affect the price of our CPOs and ADSs.
We are subject to several anti-dumping rulings that may limit our ability to
export cement to the United States.
Our Mexican operations are subject to anti-dumping rulings by the U.S.
Commerce Department which may limit our ability to export cement to the United
States. Since April 1990, our exports of gray Portland cement and clinker to the
United States from Mexico, which represented 4.5% of total sales volume of our
Mexican operations in 2002, have been subject to U.S. anti-dumping duties. In
addition, importers of gray Portland cement and clinker from Mexico, including
our U.S. operations, have been required to pay substantial cash deposits to the
U.S. Customs Service to secure the eventual payment of those duties.
We are disputing some tax claims an adverse resolution of which may result in a
significant additional tax expense.
We have received notices from the Mexican tax authorities of tax claims
in respect of the tax years from 1992 through 1996 for an aggregate amount of
approximately Ps5.2 billion, including interest and penalties through December
31, 2002. An adverse resolution of these claims could materially reduce our net
income.
Our operations are subject to environmental laws and regulations.
Our operations are subject to laws and regulations relating to the
protection of the environment in the various jurisdictions in which we operate,
such as regulations regarding the release of cement dust into the air. Stricter
laws and regulations, or stricter interpretation of existing laws or
regulations, may impose new liabilities on us or result in the need for
additional investments in pollution control equipment, either of which could
result in a material decline in our profitability in the short term.
We are an international company and are exposed to risks in the countries in
which we have significant operations or interests.
We are dependent, in large part, on the economies of the countries in
which we market our products. The economies of these countries are in different
stages of socioeconomic development. Consequently, like many other companies
9
with significant international operations, we are exposed to risks from changes
in foreign currency exchange rates, interest rates, inflation, governmental
spending, social instability and other political, economic or social
developments that may materially reduce our net income.
In 2002, the largest percentage of our net sales (34%) and total assets
(24%), at year-end, were in Mexico. If the Mexican economy experiences a
continued recession or if Mexican inflation and interest rates increase
significantly, our net income from our Mexican operations may decline materially
because construction activity may decrease, which may lead to a decrease in
cement sales. The Mexican government does not currently restrict the ability of
Mexicans or others to convert Pesos to Dollars, or vice versa. The Mexican
Central Bank has consistently made foreign currency available to Mexican private
sector entities, such as CEMEX, to meet their foreign currency obligations.
Nevertheless, if renewed shortages of foreign currency occur, the Mexican
Central Bank may not continue its practice of making foreign currency available
to private sector companies and we may not be able to purchase the foreign
currency we need to service our foreign currency obligations without substantial
additional cost.
We also have operations in the United States (24% of net sales and 19%
of total assets in 2002), Spain (14% of net sales and 9% of total assets),
Venezuela (4% of net sales and 3% of total assets), Central America and the
Caribbean (7% of net sales and 5% of total assets), Colombia (3% of net sales
and 3% of total assets), the Philippines (2% of net sales and 4% of total
assets), other Asian countries, including Thailand, (2% of total assets) and
Egypt (2% of net sales and 2% of total assets). As in the case of Mexico,
adverse economic conditions in any of these countries may produce a negative
impact on our net income from our operations in that country.
In recent years, Venezuela has experienced considerable volatility and
depreciation of its currency, high interest rates, political instability and
declining asset values. In February 2002, the government abandoned its policy of
locking the Venezuelan Bolivar within an exchange rate band in favor of a free
floating exchange rate system. The Venezuelan Bolivar has depreciated
considerably following this action and may continue to do so. Additionally,
Venezuela has experienced increased inflation, decreased gross domestic product
and labor unrest, including general strikes. In response to these events and in
an effort to shore up the economy and control inflation, Venezuelan authorities
have imposed foreign exchange and price controls on specified products,
including cement. Further economic stagnation in the private sector is expected
to result as a consequence of these market distortions. These developments have
had and may continue to have an adverse effect on the construction sector in
Venezuela, as a result of reduced demand for cement and ready-mix concrete,
which has adversely affected our sales and net income.
We believe that Asia represents an important market for our future
growth. However, since mid-1997, many countries in Asia in which we have made
significant investments have experienced considerable volatility and
depreciation of their currencies, high interest rates, banking sector crises,
stock market volatility, political instability and declining asset values. These
developments have had and may continue to have an adverse effect on the Asian
construction sector, as a result of reduced demand for cement and ready-mix
concrete, which has adversely affected our sales and net income.
We believe that Egypt also represents an important market for our
future growth. Rising instability in the Middle East, however, has resulted
from, among other things, civil unrest, extremism, the continued deterioration
of Israeli-Palestinian relations and the recent war in Iraq. There can be no
assurance that political turbulence in the Middle East will abate at any time in
the near future or that neighboring countries, including Egypt, will not be
drawn into the conflict. In Egypt, extremists have engaged in a sometimes
violent campaign against the government in recent years. There can be no
assurance that extremists will not escalate their opposition in Egypt or that
the government will continue to be successful in maintaining the prevailing
levels of domestic order and stability. Since 2000, the Egyptian government
devalued the pound four times, and in January 2003, it decided to let the pound
trade as a freely floating currency. Since that time, the Egyptian pound has
depreciated significantly against the Dollar. Future depreciation of the
Egyptian pound relative to other currencies could create additional inflationary
pressures in Egypt by generally increasing the price of imported products and
requiring recessionary government policies to curb aggregate demand. On the
other hand, if the Egyptian pound were to appreciate against other currencies,
this could dampen export-driven growth, thereby weakening the Egyptian economy
and indirectly adversely affecting cement demand. The potential impact of the
floating exchange rate system and of measures by the Egyptian government aimed
at improving Egypt's investment climate is uncertain. The Egyptian Central Bank
continues to monitor the exchange rate and reserves the right to intervene
10
without notice. Weakened investor confidence as a result of currency instability
as well as any of the other foregoing circumstances could have a material
adverse effect on the political and economic stability of Egypt and consequently
on our Egyptian operations.
The September 11, 2001 terrorist attacks on the World Trade Center and
the Pentagon temporarily disrupted the trading markets in the United States and
caused declines in major stock markets around the world. Since those attacks,
there have been terrorist attacks in Indonesia and ongoing threats of future
terrorist attacks in the United States and abroad. In response to these
terrorist attacks and threats, the United States has instituted several
anti-terrorism measures, most notably, the formation of the Office of Homeland
Security, a formal declaration of war against terrorism and the recent war in
Iraq. Although it is not possible at this time to determine the long-term effect
of these terrorist threats and attacks and the consequent response by the United
States, including the war in Iraq, there can be no assurance that there will not
be other attacks or threats in the United States or abroad that will lead to
further economic contraction in the United States or any other of our major
markets. In the short-term, however, terrorist activity against the United
States and the consequent response by the United States has contributed to the
uncertainty of the stability of the United States economy as well as global
capital markets. The current weakness of the United States economy has had, and
may continue to have, an adverse effect on the private construction sector. In
addition, the projected United States budget deficits may have an adverse effect
on the public construction sector. Further economic contraction in the United
States or any of our major markets could affect domestic demand for cement and
have a material adverse effect on our operations.
On November 1, 2001, the provincial administration of the Indonesian
province of West Sumatra, in which Gresik's Padang plant is located, announced
that it had directed the management of Semen Padang, the wholly-owned subsidiary
of Gresik that owns and operates the Padang plant, to report to the provincial
authorities and that it intended to spin off the Padang subsidiary. We believe
the provincial administration lacked legal authority to direct the affairs of
Semen Padang. Since the attempt of the West Sumatra provincial administration in
November 2001 to "take over" the management of Semen Padang, several interest
groups opposed to any further sale of the Indonesian government's stock
ownership in PT Semen Gresik to us have threatened strikes and other actions
that would affect our Indonesian operations. Further attempts to reassume
control at Semen Padang, including shareholder-approved changes in management,
have been met with resistance and lawsuits by various interest groups. The
former management refused to relinquish control and the employees at the Padang
facility have not recognized the new management. We intend to defend our
interests in Gresik and its subsidiaries, including Semen Padang. We cannot
predict, however, what effect, if any, this action will have on our investment
in Gresik.
You may be unable to enforce judgments against us
You may be unable to enforce judgments against us. We are a stock
corporation with variable capital, or sociedad anonima de capital variable,
organized under the laws of Mexico. Substantially all our directors and officers
and some of the experts named in this prospectus reside in Mexico, and all or a
significant portion of the assets of those persons may be, and the majority of
our assets are, located outside the United States. As a result, it may not be
possible for investors to effect service of process within the United States
upon those persons or to enforce judgments against them or against us in U.S.
courts, including judgments predicated upon the civil liability provisions of
the U.S. federal securities laws. We have been advised by Lic. Ramiro G.
Villarreal, General Counsel of CEMEX, that it may not be possible to enforce, in
original actions in Mexican courts, liabilities predicated solely on the U.S.
federal securities laws and it may not be possible to enforce, in Mexican
courts, judgments of U.S. courts obtained in actions predicated upon the civil
liability provisions of the U.S. federal securities laws.
11
USE OF PROCEEDS
The selling ADS holders will receive the proceeds of sales of the ADSs.
The selling ADS holders may apply such proceeds against the final forward
purchase price we are obligated to pay under the forward contracts.
In the event that we agree with the selling ADS holders to settle the
forward transactions for cash, in which case we may facilitate offers and sales
of the ADSs by the selling ADS holders pursuant to this prospectus, we may
receive a portion of the proceeds from such sales to the extent such proceeds
exceed the amount necessary to satisfy our obligations under the forward
contracts.
Unless otherwise set forth in a prospectus supplement, to the extent we
receive any proceeds from the sales of ADSs hereunder in excess of the amounts
required to settle the forward transactions, we intend to use such proceeds for
general corporate purposes, including working capital, the repayment of debt and
the expansion of our business through strategic acquisitions as opportunities
arise.
12
SELLING ADS HOLDERS
The selling ADS holders listed in the table below may sell up to the
number of ADSs set forth opposite to their respective names. The table sets
forth information with respect to beneficial ownership of our common stock by
the selling ADS holders as of June 30, 2003. The following information has been
obtained from the selling ADS holders.
Beneficial ownership of Beneficial ownership of
Number of CEMEX common stock CEMEX common stock
shares of prior to the offering after the offering(2)
Number of CEMEX ----------------------- ---------------------
ADSs that common stock Percentage Percentage
may be represented by Number of of Number of of
sold ADSs that shares of outstanding shares outstanding
in the may be sold in common common common common
offering(1) the offering stock stock stock stock(3)
------------ ------------ ------------ ------------ --------- -------
Citibank, N.A..................... 4,750,943 71,264,145 71,264,145 1.47% 0 *
ING Bank, N.V..................... 4,750,943 71,264,145 71,264,145 1.47% 0 *
Deutsche Bank AG London........... 4,750,943 71,264,145 71,264,145 1.47% 0 *
Credit Suisse First Boston
International.................. 4,099,226 61,488,390 61,488,390 1.27% 0 *
ABN AMRO Special Corporate
Services B.V................... 2,732,818 40,922,270 40,992,270 * 0 *
Societe Generale.................. 2,186,253 32,793,795 32,793,795 * 0 *
J.P. Morgan GT Corporation(4)..... 2,186,252 32,793,780 32,793,780 * 0 *
--------------
* Less than 1.0%.
(1) Includes, with respect to each selling ADS holder, the number of ADSs such
selling ADS holder has received as stock dividends in respect of the ADSs
underlying the forward contracts.
(2) Assumes that all the ADSs purchased from us pursuant to the forward
contracts and all ADSs received as stock dividends in respect of such ADSs
are sold by the selling ADS holders pursuant to the offering and that no
other shares of CEMEX common stock owned by the selling ADS holders are
sold by the selling ADS holders.
(3) Based on 4,845,934,017 shares of our common stock outstanding as of June
30, 2003.
(4) Although J.P. Morgan GT Corporation was not a party to the forward
contracts, it received these ADSs from its affiliate, JPMorgan Chase
Bank, one of the banks party to the forward contracts.
In the event a selling ADS holder sells all or a portion of its ADSs to
another bank or financial institution, such bank or financial institution may
resell such ADSs hereunder from time to time in one or more offerings.
Each of Citibank, N.A., ING Bank, N.V., Deutsche Bank AG London,
Credit Suisse First Boston International, ABN AMRO Special Corporate Services
B.V., Societe Generale, J.P. Morgan GT Corporation and their respective
affiliated companies and/or individuals may, from time to time, own or have
positions in, or options on, our securities and may also provide advisory
services and/or lending or other credit services to us.
In addition, each of the selling ADS holders are affiliates of
"brokers" or "dealers," as such terms are defined in Section 3 of the
Securities Exchange Act of 1934, as amended. However, each such selling ADS
holder purchased the ADSs to be resold by it pursuant to this prospectus in
the ordinary course of business, and at the time of such purchase, no selling
ADS holder had any agreement or understanding, directly or indirectly, with
any person to distribute such ADSs. It is anticipated, however, that in the
event of an underwritten offering of ADSs by the selling ADS holders pursuant
to this prospectus, affiliates of the selling ADS holders will enter into
underwriting agreements with CEMEX and the selling ADS holders in connection
with such offering. The specific terms of any such underwritten offering will
be reflected in an appropriate prospectus supplement.
13
DESCRIPTION OF OUR COMMON STOCK
General
We have two series of common stock, the series A common stock, with no
par value, or A shares, which can only be owned by Mexican nationals, and the
series B common stock, with no par value, or the B shares, which can be owned by
both Mexican and non-Mexican nationals. Our by-laws state that the A shares may
not be held by non-Mexican persons, groups, units or associations that are
foreign or have participation by foreign governments or their agencies. Our
by-laws also state that the A shares shall at all times account for a minimum of
64% of our total outstanding voting stock. Other than as described herein,
holders of the A shares and the B shares have the same rights and obligations.
In 1994, we changed from a fixed capital corporation to a variable
capital corporation in accordance with Mexican corporation law and effected a
three-for-one split of all our outstanding capital stock. As a result, we
changed our corporate name from CEMEX, S.A. to CEMEX, S.A. de C.V., established
a fixed capital account and a variable capital account and issued one share of
variable capital stock of the same series for each eight shares of fixed capital
stock held by any shareholder, after giving effect to the stock split.
Each of our fixed and variable capital accounts are comprised of A
shares and B shares. Under Mexican law and our by-laws, any holder of shares
representing variable capital is entitled to have those shares redeemed at that
holder's option for a price equal to the lower of:
o 95% of the market value of those shares based on the weighted
average trading price of our CPOs on the Mexican Stock Exchange during the
latest period of 30 trading days preceding the date on which the exercise of the
redemption option is effective, for a period not to exceed six months; and
o the book value of those shares at the end of the fiscal year
immediately prior to the effective date of the redemption option exercise by
that shareholder as set forth in our annual financial statements approved at the
ordinary meeting of shareholders.
If the period used in calculating the quoted share price as described
above consists of less than 30 trading days, the number of days when shares were
actually traded will be used. If shares have not been traded during this period,
the redemption price will be the book value as set forth in the latest year-end
financial statements issued prior to the redemption date. If a shareholder
exercises its redemption option during the first three quarters of a fiscal
year, that exercise is effective at the end of that fiscal year, but if a
shareholder exercises its redemption option during the fourth quarter, that
exercise is effective at the end of the next succeeding fiscal year. The
redemption price is payable as of the day following the annual ordinary meeting
of shareholders at which the relevant annual financial statements were approved.
Shareholder authorization is required to increase or decrease either
the fixed capital account or the variable capital account. Shareholder
authorization to increase or decrease the fixed capital account must be obtained
at an extraordinary meeting of shareholders. Shareholder authorization to
increase or decrease the variable capital account must be obtained at an
ordinary general meeting of shareholders.
On September 15, 1999, we effected a further stock split. For every one
of our shares of any series we issued two series A shares and one series B
share. Concurrently with this stock split, we also consummated an exchange offer
to exchange new CPOs and new ADSs representing the new CPOs for our then
existing A shares, B shares and ADSs and converted our then existing CPOs into
the new CPOs. As of December 31, 2002, approximately 94.84% of our outstanding
share capital was represented by CPOs, a portion of which is represented by
ADSs.
As of December 31, 2002, our capital stock consisted of 5,421,340,089
issued shares. As of December 31, 2002, series A shares represented 66.6% of our
capital stock, or 3,614,226,726 shares, of which 3,331,300,154 shares were
subscribed and paid, 151,182,076 shares were treasury shares, 15,218,400 were
repurchased shares which had been subscribed and paid and 116,526,096 were
authorized for issuance pursuant to our stock option plans, but which had not
14
yet been paid. B shares represented 33.4% of our capital stock, or 1,807,113,363
shares, of which 1,665,650,077 were subscribed and paid, 75,591,038 shares were
treasury shares, 7,609,200 were repurchased shares which had been subscribed and
paid and 58,263,048 were authorized for issuance pursuant to our employee stock
option plans, but which had not yet been paid. Of the total of our A shares and
B shares outstanding as of December 31, 2002, 3,267,000,000 shares corresponded
to the fixed portion of our capital stock and 2,154,340,089 shares corresponded
to the variable portion of our capital stock.
As of June 1, 2001, the Mexican securities law (Ley de Mercado de
Valores) was amended to increase the protection granted to minority shareholders
of Mexican listed companies and to commence bringing corporate governance
procedures of Mexican listed companies in line with international standards.
On February 6, 2002, the Mexican securities authority (Comision
Nacional Bancaria y de Valores) issued an official communication numbered
DGA-13813138, authorizing the amendment of our by-laws to incorporate additional
provisions to comply with the new provisions of the Mexican securities law.
Following approval from our shareholders at our 2002 annual shareholders
meeting, we amended and restated our by-laws to incorporate these additional
provisions, which consist of, among other things, protective measures to prevent
share acquisitions, hostile takeovers, and direct or indirect changes of
control. As a result of the amendment and restatement of our by-laws, the
expiration of our corporate term of existence was extended from 2019 to 2100.
On March 19, 2003, the Mexican securities authority issued new
regulations designed to (i) further implement minority rights granted to
shareholders by the Mexican securities law and (ii) simplify and comprise in a
single document provisions relating to securities offerings and periodic reports
by Mexican listed companies.
On April 24, 2003, our shareholders approved changes to our by-laws,
incorporating additional provisions and removing some restrictions. The changes
were as follows:
o The restriction that prohibits our subsidiaries from acquiring
shares in companies that own our shares was amended to remove a
condition that our subsidiaries have knowledge of such ownership.
o The limitation on our variable capital was removed. Formerly, our
variable capital was limited to ten times our minimum fixed
capital, which is currently set at Ps36.3 million.
o Increases and decreases in our variable capital now require the
notarization of the minutes of the ordinary general shareholders'
meeting that authorize such increase or decrease, as well as the
filing of these minutes with the Mexican National Securities
Registry (Registro Nacional de Valores), except when such increase
or decrease results from (i) shareholders exercising their
redemption rights or (ii) stock repurchases.
o Amendments were made to the calculation of the redemption price
for our variable capital shares, which is described above.
o Approval by the board of directors is now required for
transactions by us or any of our subsidiaries involving: (i)
transactions not in the ordinary course of business with third
parties related to us or to any of our subsidiaries, (ii)
purchases or sales of assets having a value equal to or exceeding
10% or more of our total consolidated assets, (iii) the granting
of security interests in an amount exceeding 30% of our total
consolidated assets, and (iv) any other transaction that exceeds
1% of our total consolidated assets.
o The cancellation of registration of our shares in the Securities
Section of the Mexican National Securities Registry now involves
an amended procedure, which is described below under "Repurchase
Obligation." In addition, any amendments to the article containing
these provisions no longer require the consent of the Mexican
securities authority and 95% approval by shareholders entitled to
vote.
15
Changes in Capital Stock and Preemptive Rights
Our by-laws allow for a decrease or increase in our capital stock if it
is approved by our shareholders at a shareholders' meeting, as long as the A
shares represent at least 64% of our ordinary common stock. Additional shares of
our capital stock, having no voting rights or limited voting rights, are
authorized by our by-laws and may be issued upon the approval of our
shareholders at a shareholders' meeting, with the prior approval of the Mexican
securities authority.
Our by-laws provide that shareholders have preemptive rights in
proportion to the number of shares of our capital stock they hold, before any
increase in the number of outstanding A shares, B shares, or any other existing
series of shares, as the case may be, except in the case of common stock issued
in connection with mergers or upon the conversion of convertible notes and
debentures or as set forth in Article 81 of the Mexican Securities law.
Preemptive rights give shareholders the right, upon any issuance of shares by
us, to purchase a sufficient number of shares to maintain their existing
ownership percentages. Preemptive rights must be exercised within the period and
under the conditions established for that purpose by the shareholders, and our
by-laws and applicable law provide that this period must be 15 days following
the publication of the notice of the capital increase in the Periodico Oficial
del Estado. With the prior approval of the Mexican securities authority, an
extraordinary shareholders' meeting may approve the issuance of our stock in
connection with a public offering, without the application of the preemptive
rights described above. At that meeting, holders of our stock must waive
preemptive rights by the affirmative vote of 50% of the capital stock, and the
resolution duly adopted in this manner will be effective for all shareholders.
If holders of at least 25% of our capital stock vote against the resolution, the
issuance without the application of preemptive rights may not be effected. The
Mexican securities authority may only approve the issuance if we maintain
policies that protect the rights of minority shareholders. Any shareholder
voting against the relevant resolution will have the right to have its shares
placed in the public offering together with our shares and at the same market
price.
Pursuant to our by-laws, significant acquisitions of shares of our
capital stock and changes of control of CEMEX require prior approval from our
board of directors. Our board of directors must authorize in advance any
transfer of voting shares of our capital stock that would result in any person
or group becoming a holder of 2% of more of our shares. If our board of
directors denies that authorization, it must designate an alternative buyer for
those shares, at a price equal to the price quoted on the Mexican Stock
Exchange. Any acquisition of shares of our capital stock representing 20% or
more of our capital stock by a person or group of persons requires prior
approval from our board of directors and, in the event approval is granted, the
acquiror has an obligation to make a public offer to purchase all of the
outstanding shares of that class of capital stock being purchased. In the event
the requirements described above for significant acquisitions of shares of our
capital stock are not met, the persons acquiring such shares will not be
entitled to any corporate rights with respect to such shares, such shares will
not be taken into account for purposes of determining a quorum for shareholder
meetings and we will not record such persons as holders of such shares in our
shareholder ledger.
Our by-laws require the stock certificates representing shares of our
capital stock to make reference to the provisions in our by-laws relating to the
prior approval of the board of directors for significant share transfers and the
requirements for recording share transfers in our shareholder ledger. In
addition, shareholders are responsible for informing us whenever their
shareholdings exceed 5%, 10%, 15% and 20% of the outstanding shares of a
particular class of our capital stock. We are required to maintain a shareholder
ledger that records the names, nationality and domicile of all significant
shareholders, and any shareholder that meets or exceeds these thresholds must be
recorded in this ledger if such shareholder is to be recognized or represented
at any shareholders' meeting. If a shareholder fails to inform us of its
shareholdings reaching a threshold as described above, we will not record the
transactions that cause such threshold to be met or exceeded in our shareholder
ledger, and such transaction will have no legal effect and will not be binding
on us.
Repurchase Obligation
In accordance with Mexican securities authority regulations, our
majority shareholders are obligated to make a public offer for the purchase of
stock to the minority shareholders if the listing of our stock with the Mexican
Stock Exchange is canceled, either by resolution of CEMEX or by an order of the
Mexican securities authority. The price at which the stock must be purchased by
the majority shareholders is the higher of:
16
o the weighted average price per share based on the weighted average
trading price of our CPOs on the Mexican Stock Exchange during the
latest period of 30 trading days preceding the date of the offer,
for a period not to exceed six months; or
o the book value per share, as reflected in the last quarterly
report filed with the Mexican securities authority and the Mexican
Stock Exchange.
Five business days prior to the commencement of the offering, our board
of directors must make a determination with respect to the fairness of the
offer, taking into account the interests of the minority shareholders and
disclose its opinion, which must refer to the justifications of the offer price;
if the board of directors is precluded from making such determination as a
result of a conflict of interest, the resolution of the board of directors must
be based upon a fairness opinion issued by an expert selected by the audit
committee in which emphasis must be placed on majority rights.
Following the expiration of this offer, if the majority shareholders do
not acquire 100% of the paid-in share capital, such shareholders must place in a
trust set up for that purpose for a six-month period an amount equal to that
required to repurchase the remaining shares held by investors who did not
participate in the offer. The majority shareholders are not obligated to make
the repurchase if shareholders representing 95% of our share capital waive that
right, and the amount offered for the shares is less than 300,000 UDIs (Unidades
de Inversion), which are investment units in Mexico that reflect inflation
variations. If these conditions are met, we must create a trust as described
above and provide electronic notice to the Mexican Stock Exchange. For purposes
of these provisions, majority shareholders are shareholders that own a majority
of our shares, have voting power sufficient to control decisions at general
shareholder meetings, or that may elect a majority of our board of directors.
Shareholders' Meetings and Voting Rights
Shareholders' meetings may be called by:
o our board of directors or statutory auditors;
o shareholders representing at least 10% of the then outstanding
shares of our capital stock by requesting our board of directors
or the statutory auditors to call a meeting;
o any shareholder if no meeting has been held for two consecutive
years or when the matters referred to in Article 181 of the
General Law of Commercial Companies (Ley General de Sociedades
Mercantiles) have not been dealt with; or
o a Mexican court in the event our board of directors or the
statutory auditors do not comply with the valid request of the
shareholders indicated above.
Notice of shareholders' meetings must be published in the official
gazette for the State of Nuevo Leon, Mexico or any major newspaper published and
distributed in the City of Monterrey, Nuevo Leon, Mexico. The notice must be
published at least 15 days prior to the date of any shareholders' meeting.
Consistent with Mexican law, our by-laws further require that all information
and documents relating to the shareholders meeting be available to shareholders
from the date the notice of the meeting is published.
General shareholders' meetings can be ordinary or extraordinary. At
every general shareholders' meeting, each holder of A shares and B shares is
entitled to one vote per share. Shareholders may vote by proxy duly appointed in
writing. Under the CPO trust agreement, holders of CPOs who are not Mexican
nationals cannot exercise voting rights corresponding to the A shares
represented by their CPOs.
An annual general ordinary shareholders' meeting must be held during
the first four months after the end of each of our fiscal years to consider the
approval of a report of our board of directors regarding our performance and our
financial statements for the preceding fiscal year and to determine the
allocation of the profits for the preceding year. At the annual general
17
shareholders' meeting, any shareholder or group of shareholders representing 10%
or more of our outstanding voting stock has the right to appoint one regular and
one alternate director in addition to the directors elected by the majority and
the right to appoint a statutory auditor. The alternate director appointed by
the minority holders may only substitute for the director appointed by that
minority.
A general extraordinary shareholders' meeting may be called at any time
to deal with any of the matters specified by Article 182 of the General Law of
Commercial Companies, which include, among other things:
o extending our corporate existence;
o our early dissolution;
o increasing or reducing our fixed capital stock;
o changing our corporate purpose;
o changing our country of incorporation;
o changing our form of organization;
o a proposed merger;
o issuing preferred shares;
o redeeming our own shares;
o any amendment to our by-laws; and
o any other matter for which a special quorum is required by law or
by our by-laws.
The above-mentioned matters may only be dealt with at extraordinary
shareholders' meetings.
In order to vote at a meeting of shareholders, shareholders must appear
on the list that Indeval, the Mexican securities depositary, and the Indeval
participants holding shares on behalf of the shareholders, prepare prior to the
meeting or must deposit prior to that meeting the certificates representing
their shares at our offices or in a Mexican credit institution or brokerage
house, or foreign bank approved by our board of directors to serve this
function. The certificate of deposit with respect to the share certificates must
be presented to our company secretary at least 48 hours before a meeting of
shareholders. Our company secretary verifies that the person in whose favor any
certificate of deposit was issued is named in our share registry and issues an
admission pass authorizing that person's attendance at the meeting of
shareholders.
Our by-laws provide that a shareholder may only be represented by proxy
in a shareholders' meeting with a duly completed form provided by us authorizing
the proxy's presence. In addition, our by-laws require that the secretary acting
at the shareholders' meeting publicly affirm the compliance by all proxies with
this requirement.
A shareholders' resolution is required to take action on any matter
presented at a shareholders' meeting. At an ordinary meeting of shareholders,
the affirmative vote of the holders of a majority of the shares present at the
meeting is required to adopt a shareholders' resolution. At an extraordinary
meeting of shareholders, the affirmative vote of at least 50% of the capital
stock is required to adopt a shareholders' resolution, except that when amending
Article 22 of our by-laws (which specifies the list of persons who are not
eligible to be appointed as a director or a statutory auditor) the affirmative
vote of at least 75% of the voting stock is needed. Our by-laws also require the
approval of 75% of the voting shares of our capital stock to amend provisions in
our by-laws relating to the prior approval of the board of directors for share
transfers and the requirements for recording share transfers in our corporate
ledger.
18
The quorum for a first ordinary meeting of shareholders is 50% of our
outstanding and fully paid shares, and for the second ordinary meeting of
shareholders is any number of our outstanding and fully paid shares. The quorum
for the first extraordinary shareholders meeting is 75% of our outstanding and
fully paid shares, and for the second extraordinary shareholders meeting the
quorum is 50% of our outstanding and fully paid shares.
Rights of Minority Shareholders
Our by-laws provide that holders of at least 10% of our capital stock
are entitled to demand the postponement of the voting on any resolution of which
they deem they have not been adequately informed.
Under Mexican law, holders of at least 20% of our outstanding capital
stock entitled to vote on a particular matter may seek to have any shareholder
action with respect to that matter set aside, by filing a complaint with a court
of law within 15 days after the close of the meeting at which that action was
taken and showing that the challenged action violates Mexican law or our
by-laws. Relief under these provisions is only available to holders who were
entitled to vote on, or whose rights as shareholders were adversely affected by,
the challenged shareholder action and whose shares were not represented when the
action was taken or, if represented, voted against it.
Under Mexican law, an action for civil liabilities against directors
may be initiated by a shareholders' resolution. In the event shareholders decide
to bring an action of this type, the persons against whom that action is brought
will immediately cease to be directors. Additionally, shareholders representing
not less than 15% of the outstanding shares may directly exercise that action
against the directors; provided that:
o those shareholders shall not have voted against exercising such
action at the relevant shareholders' meeting; and
o the claim covers all of the damage alleged to have been caused to
CEMEX and not merely the damage suffered by the plaintiffs.
Any recovery of damage with respect to these actions will be for the
benefit of CEMEX and not that of the shareholders bringing the action.
Registration and Transfer
Our common stock is evidenced by share certificates in registered form
with registered dividend coupons attached. Our shareholders may hold their
shares in the form of physical certificates or through institutions that have
accounts with Indeval. Accounts may be maintained at Indeval by brokers, banks
and other entities approved by the Mexican securities authority. We maintain a
stock registry, and, in accordance with Mexican law, only those holders listed
in the stock registry and those holding certificates issued by Indeval and by
Indeval participants indicating ownership are recognized as our shareholders.
Redemption
Our capital stock is subject to redemption, on a pro rata basis, upon
approval of our shareholders at an extraordinary shareholders' meeting.
Share Repurchases
If our shareholders decide at a general shareholders' meeting that we
should do so, we may purchase our outstanding shares for cancellation. We may
also repurchase our equity securities on the Mexican Stock Exchange at the then
prevailing market prices in accordance with the Mexican securities law. If we
intend to repurchase shares representing more than 1% of our outstanding shares
at a single trading session, we must inform the public of such intention at
least ten minutes before submitting our bid. If we intend to repurchase shares
representing 3% or more of our outstanding shares during a period of twenty
trading days, we would be required to conduct a public tender offer for such
shares. We must conduct share repurchases through the person or persons approved
by our board of directors, through a single broker dealer during the relevant
19
trading session without submitting bids during the first and the last 30 minutes
of each trading session and we must inform the Mexican Stock Exchange of the
results of any share repurchase no later than the business day following any
such share repurchase.
Directors' and Shareholders' Conflict of Interest
Under Mexican law, any shareholder that has a conflict of interest with
CEMEX with respect to any transaction is obligated to disclose such conflict and
is prohibited from voting on that transaction. A shareholder who violates this
prohibition may be liable for damages if the relevant transaction would not have
been approved without that shareholder's vote.
Under Mexican law, any director who has a conflict of interest with
CEMEX in any transaction must disclose that fact to the other directors and is
prohibited from voting on that transaction. Any director who violates this
prohibition will be liable for damages. Additionally, our directors and
statutory auditors may not represent shareholders in the shareholders' meetings.
Withdrawal Rights
Whenever our shareholders approve a change of corporate purpose, change
of nationality or transformation from one form of corporate organization to
another, Mexican law provides that any shareholder entitled to vote on that
change that has voted against it may withdraw from CEMEX and receive the amount
calculated as specified by Mexican law attributable to its shares, provided that
it exercises that right within 15 days following the adjournment of the meeting
at which the change was approved. For further details on the calculation of the
withdrawal right, see "- General."
Dividends
At the annual ordinary general meeting of shareholders, our board of
directors submits our financial statements together with a report on them by our
board of directors and the statutory auditors, to our shareholders for approval.
The holders of our shares, once they have approved the financial statements,
determine the allocation of our net income, after provision for income taxes,
legal reserve and statutory employee profit sharing payments, for the preceding
year. All shares of our capital stock outstanding and fully paid at the time a
dividend or other distribution is declared are entitled to share equally in that
dividend or other distribution.
Liquidation Rights
In the event we are liquidated, the surplus assets remaining after
payment of all our creditors will be divided among our shareholders in
proportion to the respective shares held by them. The liquidator may, with the
approval of our shareholders, distribute the surplus assets in kind among our
shareholders, sell the surplus assets and divide the proceeds among our
shareholders or put the surplus assets to any other uses agreed to by a majority
of our shareholders voting at an extraordinary shareholders' meeting.
20
DESCRIPTION OF OUR CPOs
Our CPOs are issued under the terms of a CPO trust agreement. The CPOs
and the CPO trust agreement are governed by Mexican law. Set forth below is a
summary description of the material terms of the CPOs and of a CPO holder's
material rights. Because it is a summary, it does not describe every aspect of
the CPOs and the CPO trust agreement. For more complete information, you should
read the entire CPO trust agreement. A form of the CPO trust agreement is
incorporated by reference as an exhibit to the registration statement of which
this prospectus forms a part. See "Where You Can Find More Information" on page
1 for information on how to obtain copies of the CPO trust agreement.
Transfer and Withdrawal of CPOs
Under the terms of the CPO trust agreement, the CPO trustee may accept
A shares and B shares against the issuance of CPOs. Each CPO will consist of two
A shares and one B share. All A shares and B shares underlying the CPOs are held
in trust by the CPO trustee in accordance with the terms and conditions of the
CPO trust agreement. Those shares are registered in the name of the CPO trustee,
which is the owner and holder of record of those shares.
The CPO trustee will deliver CPOs in respect of the shares as
described above. All CPOs are evidenced by a single certificate, the global CPO.
CPOs are issued to and deposited in accounts maintained at Indeval. Ownership of
CPOs deposited with Indeval is shown on, and transfer of the ownership of CPOs
is effected through, records maintained by Indeval and Indeval participants.
Holders of CPOs are not entitled to receive physical certificates evidencing
their CPOs but may request certificates issued by Indeval and the relevant
Indeval participants indicating ownership of CPOs. Holders of CPOs, including
Mexican nationals, are not entitled to withdraw the A shares or B shares that
are held in the CPO trust.
Dividends, Other Distributions and Rights
Holders of CPOs are entitled to receive the economic benefits to which
they would be entitled if they were the holders of the A shares and B shares
underlying those CPOs at the time that we declare and pay dividends or make
distributions to holders of A shares and B shares. The CPO trustee will
distribute cash dividends and other cash distributions received by it in respect
of the A shares and B shares held in the CPO trust to the holders of CPOs in
proportion to their respective holdings, in each case in the same currency in
which they were received. The CPO trustee will distribute those cash dividends
and other cash distributions through Indeval as custodian of the CPOs. Dividends
paid with respect to CPOs deposited with Indeval will be distributed to the
holders on the business day following the date on which the funds are received
by Indeval.
If we pay a dividend in shares of our stock, those shares will be
distributed to the CPO trustee who will hold those shares in the CPO trust for
the benefit of CPO holders entitled thereto, and the CPO trustee if the shares
so received constitute units identical to the unit of securities then
represented by a CPO will distribute to the holders of outstanding CPOs, in
proportion to their holdings, additional CPOs representing economic interests in
the total number of shares received by the CPO trustee as that dividend. If the
shares of stock so received do not constitute units of securities identical to
the unit of securities then represented by a CPO, the CPO trustee will cause the
securities received to be delivered to the CPO holders entitled thereto.
If we offer the holders of A shares and B shares the right to
subscribe for additional A shares or B shares, the CPO trustee, subject to
applicable laws, will offer to each holder of CPOs the right to instruct the CPO
trustee to subscribe for that holder's proportionate share of those additional A
shares or B shares, subject to that holder's providing the CPO trustee with the
funds necessary to subscribe for those additional shares. The CPO trustee will
offer those rights to a CPO holder only if that offer is legal and valid under
the provisions of the laws of the country of residence of that CPO holder.
Neither we nor the CPO trustee is obligated to register those rights, the CPOs
or the underlying shares under the Securities Act. If CPO trust holders are
offered those rights and if CPO holders provide the CPO trustee with the
necessary funds, the CPO trustee will subscribe for the corresponding number of
shares, which will be held in the CPO trust for the benefit of the subscribing
holders, and if the shares so received constitute units identical to the unit of
securities then represented by a CPO it will deliver additional CPOs
representing those underlying shares to the applicable CPO holders.
21
Changes Affecting Underlying Shares
If as a result of a redemption of our common stock, see "Description
of Our Common Stock-- Redemption", any underlying shares held in the CPO trust
are called for redemption, the CPO trustee will proceed in accordance with the
resolutions adopted by shareholders at the meeting of shareholders that
authorize the redemption and repurchase the corresponding CPOs.
Voting of A Shares
Mexican holders of CPOs shall be entitled to attend our shareholders'
meetings for purposes of representing and exercising the voting rights of the A
shares underlying their CPOs.
Non-Mexican holders of CPOs are not entitled to exercise voting rights
with respect to the A shares represented by their CPOs. At our shareholders'
meetings the A shares of non-Mexican holders held in the CPO trust will be voted
by the CPO trustee in accordance with the vote cast by the majority of Mexican
holders of A shares and holders of B shares voting at the meeting. The
nationality of a holder of CPOs is established by reference to the information
contained in the CPO registry book of the CPO trust. A Mexican national
constitutes either:
o an individual of Mexican nationality; or
o a Mexican corporation whose by-laws exclude foreign investors from
owning or controlling, either directly or indirectly, a majority of
its capital stock.
CPOs represented by ADSs will be deemed owned by non-Mexican
nationals.
The CPO trustee shall attend our shareholders' meetings to represent
and vote the A shares underlying the CPOs held by Mexicans for which no
instructions were received from the holders of those CPOs. The technical
committee under the trust shall have the power to cooperate with the CPO
trustee's exercise of its corporate rights with respect to the A shares
underlying the CPOs.
Voting of B Shares
All holders of CPOs shall be entitled to attend our shareholders'
meetings for purposes of representing and exercising the voting rights of the B
shares underlying their CPOs. The CPO trustee shall attend our shareholders'
meetings to represent and vote the B shares underlying the CPOs for which no
instructions were received from the holders of the CPOs. The technical committee
under the trust shall have the power to cooperate with the CPO trustee's
exercise of its corporate rights with respect to the B shares underlying the
CPOs.
Voting at CPO Holders' Meetings
Whenever we call a meeting of holders of CPOs, Mexican and non-Mexican
holders of CPOs, whether they hold their CPOs directly or in the form of ADSs,
will have the right to give instructions to vote the CPOs at the meeting.
22
The following table sets forth the method of voting for each security
contained in a CPO:
Securities Contained in a CPO Method for Voting
----------------------------- -----------------
A shares represented by CPOs held by non-Mexican nationals (all CPOs CPO trustee will vote the A shares in
represented by ADSs are deemed held by non-Mexican persons). accordance with the majority of all A
shares held by Mexican nationals and B
shares voted at the meeting.
A shares represented by CPOs held by Mexican nationals:
o If the CPO holder timely instructs the trustee as to voting CPO trustee will vote the A shares in
accordance with the CPO holder's
instructions.
o If the CPO holder makes timely arrangements with the CPO trustee to CPO holder may attend the shareholders'
attend the shareholders' meeting in person meeting and vote the A shares in person.
o If the CPO holder does not timely instruct the CPO trustee as to voting CPO trustee will vote the A shares in its
or does not make timely arrangements with the CPO trustee to attend the discretion, in cooperation with the technical
shareholders' meeting in person committee.
B shares represented by CPOs, whether held by Mexican or non-
Mexican persons:
o If the CPO holder timely instructs the CPO trustee as to voting CPO trustee will vote the B shares in
accordance with the CPO holder's
instructions.
o If the CPO holder makes timely arrangements with the CPO trustee to CPO holder may attend the shareholders'
attend the shareholders' meeting in person meeting and vote the B shares in person.
o If the CPO holder does not timely instruct the CPO trustee as to voting CPO trustee will vote the B shares in its
or does not make timely arrangements with the CPO trustee to attend the discretion, in
shareholders' meeting in person cooperation with the technical committee.
Administration of the CPO Trust
Under the terms of the CPO trust agreement, the CPO trust is
administered by the CPO trustee under the direction of a technical committee,
which must consist of at least three members. Substitute members may also be
appointed, who may substitute for any of the other members. The chairman of the
technical committee, Mr. Lorenzo H. Zambrano, will appoint, substitute or remove
all other technical committee members, and he will have the deciding vote in
case of a tie vote. Technical committee meetings may also be attended by the CPO
trustee, by the CPO common representative and by our statutory auditors, who may
participate in any debate but may not vote. Resolutions adopted by the technical
committee are required to be approved by a majority of the members of the
technical committee present at the respective meeting; provided, however, that
at least the chairman and two other members of the technical committee must be
present at a meeting in order validly to adopt resolutions. The technical
committee has the authority to instruct the CPO trustee to increase the maximum
number of additional CPOs which may be delivered for the purposes permitted by
the CPO trust agreement.
Termination of the CPO Trust and Establishment of Successor Trust
The CPO trust term is 30 years from the date of execution and expires
August 26, 2029. Upon termination, the trustee and the common representative of
the CPO holders shall constitute a successor CPO trust with the same terms and
conditions set forth in the CPO trust agreement, other than the provisions
pertaining to the exchange of CPOs for successor trust CPOs. We refer to that
successor CPO trust as the successor trust. Upon termination investors holding
CPOs, subject to the provision of our by-laws described below, will receive in
exchange for their CPOs, the successor trust CPOs issued by the successor
trustee. Each successor trust CPO will represent the economic interests in two A
shares and one B share.
The CPO trust cannot be terminated if any dividends or other
distributions previously received by the CPO trustee remain unpaid to any CPO
holder.
Upon termination of the CPO trust, any transfer of A shares or B
shares which would result in any person or group of persons acting in concert
23
becoming a holder of 2% or more of our voting shares will be subject, as
provided in our by-laws, to prior approval of our board of directors. See
"Description of Our Common Stock--Changes in Capital Stock and Preemptive
Rights."
We will be obligated to pay any cost or expense incurred in connection
with the transfer of the shares from the CPO trust to the successor trust and
the exchange of CPOs for successor trust CPOs.
Charges of the CPO trustee and Indeval
Under the CPO trust agreement, we will be obligated to pay the fees of
the CPO trustee for the administration of the CPO trust and the fees of Indeval
as depository.
24
DESCRIPTION OF OUR ADSs
Citibank, N.A. is the depositary for our ADSs. Citibank's depositary
offices are located at 111 Wall Street, New York, New York 10005. The ADSs
represent ownership interests in securities that are on deposit with the
depositary. The depositary typically appoints a custodian to safe keep the
securities on deposit. ADSs are normally represented by certificates that are
commonly known as American Depositary Receipts, or ADRs.
We have appointed Citibank as ADS depositary pursuant to a deposit
agreement. A copy of the ADS deposit agreement is on file with the SEC under
cover of a Registration Statement on Form F-6. You may obtain a copy of the ADS
deposit agreement from the SEC's Public Reference Room at 450 Fifth Street,
N.W., Washington, D.C. 20549. Please refer to Registration Number 333-11338 when
retrieving the copy.
Set forth below is a summary description of the material terms of the
ADSs and of an ADS holder's material rights. Because it is a summary, it does
not describe every aspect of the ADSs and the ADS deposit agreement. For more
complete information, you should read the entire ADS deposit agreement and the
form of ADR which contains the terms of the ADSs. The ADS deposit agreement is
incorporated by reference as an exhibit to the registration statement of which
this prospectus forms a part.
Each ADS represents five (5) CPOs. Each CPO is issued under the terms
of a CPO trust and represents two (2) A shares and one (1) B share. The CPO
trust is expected to terminate on or about August 26, 2029, at which point the
CPO trustee and the common representative of the CPO holders will constitute a
new CPO trust with the same terms and conditions as the CPO trust agreement,
which we call the "successor trust." The terms of the CPO trust and the
successor trust are more fully described above. See "Description of Our CPOs."
Upon termination of the CPO trust, which we call the "conversion date," holders
of CPOs will be entitled to receive successor trust CPOs. Assuming no change in
the securities represented by CPOs during the term of the CPO trust, each
successor trust CPO will represent two (2) A shares and one (1) B share. Holders
of ADSs will, on and after the conversion date, have the right to receive five
successor trust CPOs for every ADS held. The CPOs and successor trust CPOs
eligible for deposit with the custodian are sometimes known as "eligible
securities," and the eligible securities once deposited with the custodian are
sometimes known as "deposited securities" against which the ADS depositary
issues the ADSs. Please note that an ADS also represents any other property
received by the ADS depositary or the custodian on behalf of the owner of the
ADS but not distributed to that owner because of legal or practical
restrictions. Citibank has appointed Banamex as custodian for the deposited
securities represented by the ADSs. The receipts evidencing the ADSs are
issuable in registered form by the depositary pursuant to the ADS deposit
agreement.
The ADS deposit agreement and the related ADR contain our rights and
obligations as well as your rights and obligations and those of the depositary.
The ADS deposit agreement is governed by New York law. Each of CEMEX and the
depositary has agreed that federal and state courts in the City of New York will
have non-exclusive jurisdiction over any actions, proceedings or disputes that
arise out of or in connection with the ADS deposit agreement and submits to that
jurisdiction. However, our obligations to the holders of deposited securities
will continue to be governed by the laws of Mexico, which may be very different
from the laws in the United States.
If you become an owner of ADSs, you may hold your ADSs either in the
form of an ADR certificate registered in your name or through a brokerage or
safekeeping account. If you then decide to hold your ADSs through your brokerage
or safekeeping account, you must rely on the procedures of your broker or
custodian to assert your rights as an ADS owner. This summary description
assumes you have opted to own the ADSs directly by means of an ADR registered in
your name and, as such, we will refer to you as "holder."
Dividends and Distributions
If you become a holder of ADSs, you will usually have the right to
receive the distributions we make on the securities deposited with the
custodian. Your receipt of these distributions may be limited, however, by
practical considerations and legal restrictions. Holders will receive
distributions they are entitled to receive under the terms of the ADS deposit
agreement in proportion to the number of ADSs they hold as of a specified record
date.
25
Distributions of Cash
Whenever we make a cash distribution payment for the securities on
deposit with the custodian and the ADS depositary receives confirmation of our
deposit of the distribution, the ADS depositary will convert the cash
distribution into Dollars and distribute the proceeds of the conversion to the
holders, so long as the conversion is reasonable and the Dollars are
transferable to the United States. The amounts distributed to holders will be
net of the fees, expenses, taxes and governmental charges payable by holders
under the terms of the ADS deposit agreement. The ADS depositary will distribute
the proceeds of the sale of any property held by the custodian in respect of the
securities on deposit in the same manner.
Distributions of Eligible Securities
Whenever we make a free distribution of eligible securities for the
securities on deposit with the custodian, we will deposit the eligible
securities with the custodian. When the ADS depositary receives confirmation of
our deposit with the custodian, the ADS depositary will either distribute to
holders ADSs representing the eligible securities deposited or modify the ADS to
deposited securities ratio, in which case each ADS you hold will represent
rights and interests in the additional eligible securities so deposited. The ADS
depositary will distribute only whole numbers of ADSs. The ADS depositary will
sell any remaining fractional entitlements and distribute the proceeds of that
sale as in the case of a cash distribution.
The distribution of the new eligible securities will be made net of
the fees, expenses, taxes and governmental charges payable by holders under the
terms of the ADS deposit agreement. In order to pay those taxes and governmental
charges, the ADS depositary may sell all or a portion of the eligible securities
so distributed.
The ADS depositary will not make a distribution of ADSs if the
distribution would constitute a breach of law. If the ADS depositary does not
distribute ADSs upon the terms described above, it will sell the securities
received, if that sale is lawful and reasonably practical, and will distribute
the proceeds of the sale as in the case of a cash distribution.
Distributions of Rights
Whenever we intend to distribute rights to subscribe for additional
eligible securities we will give prior notice to the ADS depositary and we will
assist the ADS depositary in determining whether it is lawful and reasonably
practicable to distribute the rights to subscribe for additional eligible
securities to you and provide the ADS depositary with the documentation required
under the ADS deposit agreement.
If we have satisfied these conditions, the ADS depositary will
establish procedures to distribute rights and to enable holders to exercise
those rights. Holders of ADSs may have to pay fees, expenses, taxes and other
governmental charges to subscribe for the ADSs when they exercise their rights.
We cannot assure you that any holder of ADSs will be able to exercise rights on
the same terms as holders of eligible securities or that any holder of ADSs will
be able to exercise its rights at all. The ADS depositary has no obligation to
provide you with the means to exercise rights to subscribe for new eligible
securities rather than ADSs.
The ADS depositary will not distribute the rights to any holder of
ADSs if:
o we do not request that the rights be distributed to such holders or
if we ask that the rights not be distributed to such holders;
o we fail to deliver the required documents to the ADS depositary; or
o it is not reasonably practicable to distribute the rights to such
holders.
The ADS depositary will sell the rights that are not exercised or not
distributed if such a sale would be lawful and reasonably practicable. The
proceeds of that sale will be distributed to holders as in the case of a
distribution in cash. If the ADS depositary is unable to sell the rights, it
will allow the rights to lapse.
26
Elective Distributions
Whenever we intend to distribute a dividend payable at the election of
shareholders either in cash or in additional eligible securities, we will give
prior notice thereof to the ADS depositary and will indicate whether we wish the
elective distribution to be made available to holders of ADSs. In that case, we
will assist the ADS depositary in determining whether that distribution is
lawful and reasonably practical.
The ADS depositary will make the election available to holders of ADSs
only if it is reasonably practical and if we have provided all of the
documentation contemplated in the ADS deposit agreement. In that case, the ADS
depositary will establish procedures to enable holders of ADSs to elect to
receive either cash or additional ADSs, in each case as described in the ADS
deposit agreement.
If the election is not made available to holders of ADSs, such holders
will receive either cash or additional ADSs, depending on what a shareholder in
Mexico would receive for failing to make an election, as more fully described in
the ADS deposit agreement.
Redemption
Whenever we decide to redeem any of the securities on deposit with the
custodian, we will notify the ADS depositary. If it is reasonably practicable
and if we provide all of the documentation contemplated in the ADS deposit
agreement, the ADS depositary will mail notice of the redemption to the holders.
The custodian will be instructed to surrender the deposited securities
being redeemed against payment of the applicable redemption price. The ADS
depositary will convert the redemption funds received into Dollars upon the
terms of the ADS deposit agreement and will establish procedures to enable
holders to receive the net proceeds from the redemption upon surrender of their
ADSs to the ADS depositary. Holders of ADSs may have to pay fees, expenses,
taxes and other governmental charges upon the redemption of their ADSs. If less
than all ADSs are being redeemed, the ADSs to be retired will be selected by lot
or on a pro rata basis, as the ADS depositary may determine.
Other Distributions
Whenever we intend to distribute property other than cash, eligible
securities or rights to purchase additional eligible securities, we will give
prior notice thereof to the ADS depositary and will indicate whether we wish the
distribution to be made to you. In that case, we will assist the ADS depositary
in determining whether the distribution to holders is lawful and reasonably
practicable.
If it is reasonably practicable to distribute the property to you and
if we provide all the required documentation, the ADS depositary shall
distribute that property to the holders in a manner it deems practicable for
accomplishing the distribution.
The distribution of the property will be made net of fees, expenses,
taxes and governmental charges payable by holders under the terms of the ADS
deposit agreement. In order to pay those taxes and governmental charges, the ADS
depositary may sell all or a portion of the property.
The ADS depositary will not distribute the property to holders of ADSs
and will sell the property if:
o we do not request that the property be distributed to such holders
or if we ask that the property not be distributed to such holders;
o we do not deliver satisfactory documents to the depositary; or
o it is not reasonably practicable or feasible.
The proceeds of any sale of the property will be distributed to
holders as in the case of a cash distribution.
27
Changes Affecting Deposited Securities
The deposited securities held on deposit in respect of ADSs may change
from time to time as a result, for example, of a change in nominal or par value,
a split-up, cancellation, consolidation or re-classification of deposited
securities or a recapitalization, reorganization, merger, consolidation or sale
of our assets.
If any such change were to occur, ADSs will, to the extent permitted
by law, represent the right to receive the property received or exchanged or in
respect of the deposited securities held on deposit. The ADS depositary may in
such circumstances deliver additional ADSs to holders of ADSs or call for the
exchange of ADSs for replacement ADSs. If the ADS depositary may not lawfully
distribute that property to holders of ADSs, the ADS depositary may sell that
property and distribute the net proceeds from that sale to such holders as in
the case of a cash distribution.
Issuance of ADSs upon Deposit of Eligible Securities
The ADS depositary will create ADSs if eligible securities are
deposited with the custodian. The ADS depositary will deliver the ADSs
representing the eligible securities deposited to the person indicated after
payment of the applicable issuance fees and all charges and taxes payable for
the transfer of the eligible securities to the custodian. In the case of the
distribution of ADSs to holders of ADWs equal to the appreciation value upon
redemption or at maturity of the appreciation warrants, the ADW holders will not
be required to make the deposit or pay a fee.
Please note that the issuance of ADSs in all cases, other than the
distribution of the appreciation value, may be delayed until the ADS depositary
or the custodian receives confirmation that all required approvals have been
given and that the eligible securities have been duly transferred. The ADS
depositary will only issue ADSs in whole numbers.
When a deposit of eligible securities is made, the depositor will be
responsible for transferring good and valid title to the ADS depositary. In
addition, the depositor will be deemed to represent and warrant that:
o the eligible securities are duly authorized, validly issued, fully
paid, non-assessable and legally obtained;
o all preemptive and similar rights, if any, with respect to the
eligible securities have been validly waived or exercised;
o the depositor is duly authorized to deposit the eligible securities;
o the eligible securities presented for deposit are free and clear of
any lien, encumbrance, security o interest, charge, mortgage or
adverse claim, and are not, and the ADSs issuable upon that deposit
will not be, "restricted securities"; and
o the eligible securities presented for deposit have not been stripped
of any rights or entitlements.
If any of these representations or warranties are false in any way, we
and the ADS depositary may, at the depositor's cost and expense, take any and
all actions necessary to correct the consequences thereof.
Withdrawal of Deposited Securities Upon Cancellation of ADSs
A holder of ADSs is entitled to present its ADSs to the ADS depositary
for cancellation and to receive delivery of the deposited securities represented
by its ADSs at the custodian. In order to withdraw the deposited securities
represented by such ADSs, the holder withdrawing will be required to pay the
fees of the ADS depositary for cancellation of its ADSs and the charges and
taxes payable for the transfer of the deposited securities being withdrawn. The
holder withdrawing ADSs assumes the risk for delivery of all funds and
securities upon withdrawal. Once cancelled, ADSs shall be devoid of any benefits
provided under the ADS deposit agreement.
The ADS depositary may ask for proof of identity and the genuineness
of signatures before canceling ADSs. The withdrawal of the deposited securities
28
represented by ADSs may be delayed until the ADS depositary receives
satisfactory evidence of compliance with all applicable laws and regulations. A
holder of ADSs is not entitled to withdraw the shares underlying CPOs. When ADSs
are surrendered prior to the conversion date, the holder will be entitled to
receive CPOs; after the conversion date, the holder will be entitled to receive
successor trust CPOs. The ADS depositary will only accept ADSs for cancellation
that represent a whole number of deposited securities.
A holder will have the right to withdraw the securities represented by
its ADSs at any time except for:
o temporary delays that may arise because the transfer books for the
CPOs, successor trust CPOs, or ADSs o are closed, or the deposited
securities are immobilized on account of a shareholders' meeting or
a payment of dividends;
o obligations to pay fees, taxes and similar charges; and
o restrictions imposed on account of laws or regulations applicable to
ADSs or the withdrawal of the securities on deposit.
Please note that the ADS deposit agreement may not be modified to
impair withdrawal rights in respect of deposited securities represented by ADSs
except to comply with mandatory provisions of law.
Voting Rights
A holder of ADSs has the right to instruct the ADS depositary to
exercise the voting rights for the deposited securities represented by its ADSs.
However, our by-laws prohibit non-Mexican nationals from directly holding or
voting A shares. A holder of ADSs is deemed to be a non-Mexican national and
accordingly, has no right to vote the A shares held in the CPO trust or the
successor trust. The voting rights of holders of deposited securities are
described in "Description of Our CPOs--Voting of A Shares" and "Description of
Our CPOs--Voting of B Shares" above.
At our request, the ADS depositary will coordinate with us the mailing
to holders of ADSs of any notice of shareholders' meeting together with
information explaining how to instruct the depositary to exercise the voting
rights, if any, pertaining to the deposited securities represented by ADSs. We
will use our best efforts to deliver the notice of shareholders' meeting to the
ADS depositary 20 days prior to the date of the meeting. The ADS depositary will
coordinate with us the mailing of the notice to ADS holders to coincide as
closely as is reasonably practicable with the publication of the notice of
shareholders' meeting in Mexico.
Prior to the conversion date, at any meeting of shareholders, ADS
holders have the right to instruct the ADS depositary to exercise your voting
rights only in respect of the B shares held in the CPO trust. The terms of the
CPO trust require the CPO trustee to vote the A shares held in the CPO trust in
the same manner as the votes cast by the holders of the majority of all A shares
held by Mexican nationals and B shares voted at the meeting.
On and after the conversion date, at any meeting of shareholders, ADS
holders have the right to instruct the ADS depositary to exercise their voting
rights in respect of the B shares in the successor trust. The terms of the
successor trust are expected to require the successor trustee to vote the A
shares held in the successor trust in substantially the same manner as A shares
are voted under the CPO trust.
Whenever we call a meeting of holders of CPOs or successor trust CPOs,
you have the right, as a holder of ADSs representing CPOs or successor trust
CPOs, to instruct the ADS depositary to vote the CPOs or successor trust CPOs
according to your instructions.
If the ADS depositary timely receives your voting instructions, it
will endeavor to vote the securities represented by ADSs for which holders of
ADSs are entitled to give voting instructions according to those voting
instructions.
If the ADS depositary does not receive voting instructions from a
holder of ADSs in a timely manner such holder will nevertheless be treated as
having instructed the ADS depositary to give a proxy to a person we designate to
29
vote the B shares underlying the CPOs represented by your ADSs in his/her
discretion. The ADS depositary will not deliver the discretionary proxy if:
o we do not provide the ADS depositary with the requisite materials
pertaining to the meeting on a timely basis;
o we request that the discretionary proxy not be given;
o we do not deliver to the ADS depositary a satisfactory opinion of
counsel providing legal comfort under Mexican laws on the subject of
the discretionary proxy; or
o we do not deliver a satisfactory representation and indemnity letter
to the ADS depositary.
Please note that the ability of the ADS depositary to carry out voting
instructions may be limited by practical and legal limitations and the terms of
the securities on deposit. We cannot assure holders of ADSs that they will
receive voting materials in sufficient time to enable them to return voting
instructions to the ADS depositary in a timely manner.
The ADS depositary or the custodian for the CPOs on deposit may
represent the CPOs at any meeting of holders of CPOs even if no voting
instructions have been received. The CPO trustee may represent the A shares and
the B shares represented by the CPOs at any meeting of holders of A shares or B
shares even if no voting instructions have been received. By so attending, the
ADS depositary, the custodian or the CPO trustee, as applicable, may contribute
to the establishment of a quorum at a meeting of holders of CPOs, A shares or B
shares, as appropriate.
Fees and Charges
An ADS holder is required to pay the following service fees to the
ADS depositary:
Service Fees
-------- ----
Issuance of ADSs Up to 5(cent)per ADS issued
Cancellation of ADSs Up to 5(cent)per ADS cancelled
Exercise of rights to purchase additional ADSs Up to 5(cent)per ADS issued
Distribution of cash upon sale of rights and Up to 2(cent)per ADS held
other entitlements
An ADS holder also is responsible to pay fees and expenses incurred
by the ADS depositary and taxes and governmental charges including, but not
limited to:
o transfer and registration fees charged by the registrar and transfer
agent for eligible and deposited securities, such as upon deposit of
eligible securities and withdrawal of deposited securities;
o expenses incurred for converting foreign currency into Dollars;
o expenses for cable, telex and fax transmissions and for delivery of
securities; and
o taxes and duties upon the transfer of securities, such as when you
deposit eligible securities or withdraw deposited securities.
We have agreed to pay some of the other charges and expenses of the
ADS depositary. Note that the fees and charges that a holder of ADSs is
required to pay may vary over time and may be changed by us and by the ADS
depositary. ADS holders will receive notice of the changes.
30
Amendments and Termination
We may agree with the ADS depositary to modify or to supplement the
ADS deposit agreement at any time without the consent of ADS holders. We
undertake to provide ADS holders with 30 days' prior notice of any
modifications or supplements that would materially prejudice the substantial
rights of ADS holders under the ADS deposit agreement. We will not consider to
be materially prejudicial to the substantial rights of ADS holders any
modifications or supplements that are reasonably necessary for the ADSs to be
registered under the Securities Act or to be eligible for book-entry
settlement, in each case without imposing or increasing the fees and charges
ADS holders are required to pay. In addition, we may not be able to provide
ADS holders with prior notice of any modifications or supplements that are
required to accommodate compliance with applicable provisions of law, whether
or not those modifications or supplements could be considered to be materially
prejudicial to the substantive rights of ADS holders.
ADS holders will be bound by the modifications to the ADS deposit
agreement if they continue to hold ADSs after the modifications to the ADS
deposit agreement become effective. The ADS deposit agreement cannot be
amended to prevent ADS holders from withdrawing the deposited securities
represented by ADSs, except as described above in "--Withdrawal of Deposited
Securities Upon Cancellation of ADSs."
We have the right to direct the ADS depositary to terminate the ADS
deposit agreement. Similarly, the ADS depositary may in some circumstances on
its own initiative terminate the ADS deposit agreement. In either case, the
ADS depositary must give notice to the holders at least 30 days before
termination.
Upon termination, the following will occur under the ADS deposit
agreement:
o for a period of three months after termination, ADS holders will be
able to request the cancellation of their ADSs and the withdrawal of
the deposited securities represented by their ADSs and the delivery
of all other property held by the ADS depositary in respect of their
deposited securities on the same terms as prior to the termination.
During this three-month period, the ADS depositary will continue to
collect all distributions received on the deposited securities, such
as dividends, but will not distribute any such property to ADS
holders until they request the cancellation of their ADSs; and
o after the expiration of the three-month period, the ADS depositary
may sell the deposited securities held on behalf of the remaining
holders with the custodian. The ADS depositary will hold the
proceeds o from the sale and any other funds then held for the
holders of ADSs in a non-interest bearing account. At that point,
the ADS depositary will have no further obligations to holders other
than to account for the funds then held for the holders of ADSs
still outstanding.
Books of ADS Depositary
The ADS depositary will maintain ADS holder records at its depositary
office. Holders of ADSs may inspect those records at that office during regular
business hours but solely for the purpose of communicating with other holders in
the interest of business matters relating to the ADSs and the ADS deposit
agreement.
The ADS depositary will maintain facilities in New York to record and
to process the issuance, cancellation, combination, split-up and transfer of
ADSs. These facilities may be closed from time to time, to the extent not
prohibited by law.
Limitations on Obligations and Liabilities
The ADS deposit agreement limits our obligations and the ADS
depositary's obligations to holders of ADSs. Please note the following:
o We and the ADS depositary are only obligated to take the actions
specifically stated in the ADS deposit agreement without negligence
or bad faith.
o The ADS depositary disclaims any liability for any failure to carry
31
out voting instructions, for any o manner in which a vote is cast or
for the effect of any vote, provided it acts in good faith and in
accordance with the terms of the ADS deposit agreement.
o The ADS depositary disclaims any liability for any failure to
determine the lawfulness or reasonable practicality of any action,
for the content of any document forwarded to ADS holders on their
behalf or for the accuracy of any translation of such document, for
the investment risks associated with investing o in deposited
securities, for the validity or worth of the deposited securities,
for any tax consequences that result from the ownership of ADSs, for
allowing any rights to lapse under the terms of the ADS deposit
agreement, for the timeliness of any of our notices or for our
failure to give notice.
o We and the ADS depositary will not be obligated to perform any act
that is inconsistent with the terms of the ADS deposit agreement.
o We and the ADS depositary disclaim any liability if we are prevented
or forbidden from acting on account o of any law or regulation, any
provision of our by-laws, any provision of any securities on deposit
or by reason of any act of God or war or other circumstances beyond
our control.
o We and the ADS depositary disclaim any liability by reason of any
exercise of, or failure to exercise, o any discretion provided for
in the ADS deposit agreement or in our by-laws or in any provisions
of the securities on deposit.
o We and the ADS depositary further disclaim any liability for any
action or inaction in reliance upon the advice of or information
from legal counsel, accountants, any person presenting eligible
securities for o deposit, any holder of ADSs or authorized
representative thereof, or any other person believed by us in good
faith to be competent to give such advice or information.
o We and the ADS depositary also disclaim liability for the inability
by a holder to benefit from any o distribution, offering, right or
other benefit which is made available to holders of eligible
securities but is not, under the terms of the ADS deposit agreement,
made available to the holders of the ADSs.
o We and the ADS depositary may rely without any liability upon any
written notice, request or other o document believed by the ADS
depositary to be genuine and to have been signed or presented by the
proper parties.
o We and the ADS depositary disclaim any liability for any
consequential or punitive damages.
Pre-Release Transactions
The ADS depositary may, in some circumstances, issue ADSs before
receiving a deposit of eligible securities or release deposited securities
before receiving ADSs. These transactions are commonly referred to as
"pre-release transactions." The ADS deposit agreement limits the aggregate size
of pre-release transactions and imposes a number of conditions on such
transactions including the need to receive collateral, the type of collateral
required, and the representations required from brokers. The ADS depositary may
retain the compensation received from the pre-release transactions.
Taxes
Holders of ADSs will be responsible for the taxes and other
governmental charges payable on the ADSs and the securities represented by the
ADSs. We, the ADS depositary and the custodian may deduct from any distribution
the taxes and governmental charges payable by holders and may sell any and all
property on deposit to pay the taxes and governmental charges payable by
holders. Holders of ADSs will be liable for any deficiency if the sale proceeds
do not cover the taxes that are due.
The ADS depositary may refuse to issue ADSs and to deliver, transfer,
split and combine ADRs or to release securities on deposit until all applicable
taxes and charges are paid by the holder. The ADS depositary and the custodian
32
may take reasonable administrative actions to obtain tax refunds and reduced tax
withholding for any distributions on behalf of ADS holders. However, ADS holders
may be required to provide to the ADS depositary and to the custodian proof of
taxpayer status and residence and any other information as the ADS depositary
and the custodian may reasonably require to fulfill legal obligations. Holders
of ADSs are required to indemnify us, the ADS depositary and the custodian for
any claims with respect to taxes based on any tax benefit obtained for such
holders.
Foreign Currency Conversion
Whenever the ADS depositary or the custodian receives foreign currency
and the ADS depositary can reasonably convert all foreign currency received into
Dollars, the ADS depositary will distribute the Dollars according to the terms
of the ADS deposit agreement. ADS holders may have to pay fees and expenses
incurred in converting foreign currency, such as fees and expenses incurred in
complying with currency exchange controls and other governmental requirements.
If the conversion of foreign currency is not practical or lawful, or
if any required approvals are denied or not obtainable at a reasonable cost or
within a reasonable period, the ADS depositary may take the following actions in
its discretion:
o convert the foreign currency to the extent practical and lawful and
distribute the Dollars to holders of ADSs when the conversion and
distribution is lawful and practicable;
o distribute the foreign currency to holders of ADSs when the
distribution is lawful and practicable; or
o hold the foreign currency, without liability for interest, for
holders of ADSs.
33
INCOME TAX CONSIDERATIONS
U.S. Federal Income Tax Considerations
General
The following is a summary of the material U.S. federal income tax
consequences relating to the ownership and disposition of our CPOs and ADSs.
This summary is based on provisions of the U.S. Internal Revenue Code
of 1986, as amended (the "Code"), U.S. Treasury regulations promulgated under
the Code, and administrative rulings, and judicial interpretations of the Code,
all as in effect on the date of this prospectus and all of which are subject to
change, possibly retroactively. This summary is limited to U.S. Shareholders (as
defined below) who acquire our ADSs from the selling ADS holders. This summary
does not discuss all aspects of U.S. federal income taxation which may be
important to you in light of your individual circumstances, for example, if you
are an investor subject to special tax rules (e.g., if you are a bank, a thrift,
a real estate investment trust, a regulated investment company, an insurance
company, a dealer in securities or currencies, an expatriate or tax-exempt
investor, a person whose functional currency is not the U.S. Dollar or a
shareholder who owns (directly or indirectly) 10% or more of our outstanding
voting stock) or if you hold a CPO or an ADS as a position in a "straddle," as
part of a "synthetic security" or "hedge," as part of a "conversion transaction"
or other integrated investment, or as other than a capital asset. In addition,
this summary does not address any aspect of state, local or foreign taxation.
You are advised to consult with your own tax advisor regarding the U.S.
federal income tax consequences to you of the ownership and disposition of CPOs
or ADSs in light of your particular tax situation and under state, local and
foreign tax laws applicable to you.
For purposes of this summary, a "U.S. Shareholder" means a beneficial
owner of CPOs or ADSs who is for U.S. federal income tax purposes:
o an individual who is a citizen or resident of the United States for
U.S. federal income tax purposes;
o a corporation or other entity taxable as a corporation that is
created or organized in the United States or under the laws of the
United States or any state thereof (including the District of
Columbia);
o an estate the income of which is includible in gross income for U.S.
federal income tax purposes regardless of its source; or
o a trust if a court within the United States is able to exercise
primary supervision over the administration of such trust and one or
more United States persons have the authority to control all
substantial decisions of such trust.
If a partnership (including any entity treated as a partnership for
U.S. federal income tax purposes) is a beneficial owner of CPOs or ADSs, the
U.S. federal income tax treatment of a partner in such partnership will
generally depend upon the status of the partner and the activities of the
partnership.
Ownership of CPOs or ADSs in general
In general, for U.S. federal income tax purposes, U.S. Shareholders who
own ADSs will be treated as the beneficial owners of the CPOs represented by
those ADSs, and each CPO will represent a beneficial interest in two A shares
and one B share.
34
Taxation of dividends with respect to CPOs and ADSs
Distributions of cash or property with respect to the A shares or B
shares represented by CPOs, including CPOs represented by ADSs, usually will be
includible in the gross income of a U.S. Shareholder as foreign source dividend
income on the date the distributions are received by the CPO trustee, or
successor thereof, to the extent paid out of our current or accumulated earnings
and profits. These dividends will not be eligible for the dividends-received
deduction usually allowed to corporate U.S. Shareholders. To the extent, if any,
that the amount of any distribution by us exceeds our current and accumulated
earnings and profits as determined under U.S. federal income tax principles, it
will be treated first as a tax-free return of the U.S. Shareholder's adjusted
tax basis in the CPOs or ADSs and thereafter as capital gain.
Dividends paid in Pesos will be includible in the income of a U.S.
Shareholder in a Dollar amount calculated by reference to the exchange rate in
effect the day the Pesos are received by the CPO Trustee, whether or not they
are converted into Dollars on that day. Any gain or loss resulting from currency
exchange fluctuations during the period from the date the dividend is
distributed to the date a U.S. Shareholder converts the payment into Dollars
generally will be treated as ordinary income or loss. Such gain or loss
generally will be income or loss from sources within the United States for
foreign tax credit limitation purposes. For purposes of calculating the U.S.
foreign tax credit, dividends paid by us usually will constitute "passive
income," or in the case of some U.S. Shareholders "financial services income."
Taxation of capital gains on disposition of CPOs or ADSs
The sale or exchange of CPOs or ADSs will result in the recognition of
gain or loss by a U.S. Shareholder for U.S. federal income tax purposes in the
amount of the difference between the amount realized and the U.S. Shareholder's
tax basis therein. That gain or loss recognized by a U.S. Shareholder usually
will be long-term capital gain or loss if the U.S. Shareholder's holding period
for the CPOs or ADSs exceeds one year at the time of disposition. Gain from the
sale or exchange of the CPOs or ADSs usually will be treated as U.S. source gain
for purposes of the foreign tax credit rules of U.S. tax law. Deposits and
withdrawals of CPOs by U.S. Shareholders in exchange for ADSs will not result in
the realization of gain or loss for U.S. federal income tax purposes.
Recent Tax Legislation
The Jobs and Growth Tax Relief Reconciliation Act of 2003 (the "Act"),
enacted on May 28, 2003, reduces the maximum rate of tax imposed on certain
dividends received by U.S. Shareholders that are individuals to 15% (5% for
individuals in the lower tax brackets and 0% for these taxpayers in 2008) (the
"Reduced Rate"). The Reduced Rate applies to dividends received after December
31, 2002 and before January 1, 2009. In order for dividends paid by a foreign
corporation to be eligible for the Reduced Rate, the foreign corporation must be
a "qualified foreign corporation" within the meaning of the Act. We believe that
we will be considered a "qualified foreign corporation" within the meaning of
the Act because our ADSs are listed on the New York Stock Exchange and thus any
distributions we make that are treated as taxable dividends whether in cash,
stock or other property should qualify for the Reduced Rate. There can be no
assurance, however, that we will continue to be considered a "qualified foreign
corporation" and that our dividends will continue to be eligible for the Reduced
Rate.
The Act also reduces the top individual tax rate on adjusted net
capital gains for sales and exchanges of capital assets on or after May 6, 2003
and before January 1, 2009 from 20% (10% for individuals in the lower tax
brackets) to 15% (5% for individuals in the lower tax brackets and 0% for these
taxpayers in 2008).
United States Backup Withholding and Information Reporting
A U.S. Shareholder may, under certain circumstances, be subject to
"backup withholding" with respect to some payments to the U.S. Shareholder,
such as dividends or the proceeds of a sale or other disposition of the CPOs
or ADSs, unless such holder (i) is a corporation or comes within certain
exempt categories, and demonstrates this fact when so required, or (ii)
provides a correct taxpayer identification number, certifies that it is not
subject to backup withholding and otherwise complies with applicable
requirements of the backup withholding rules. Any amount withheld under these
rules will be creditable against the U.S. Shareholder's federal income tax
liability.
35
Mexican Tax Considerations
General
The following is a summary of certain Mexican federal income tax
considerations relating to your ownership and disposition of our CPOs or ADSs.
This summary is based on the Mexican federal income tax law that is
in effect on the date of this prospectus which is subject to change. This
summary is limited to tax consequences applicable to non-residents of Mexico,
as defined below, who acquire our ADSs from selling ADS holders. This summary
does not address all aspects of Mexican tax laws in effect as of the date of
this prospectus. Prospective holders are urged to consult their own tax
advisor as to the tax consequences of the ownership and disposition of CPOs or
ADSs.
For purposes of Mexican taxation, an individual is a resident of
Mexico if he or she has established his or her home in Mexico, unless he or
she has resided in another country for more than 183 calendar days during the
calendar year and can demonstrate that he or she has become a resident of that
country for tax purposes. A legal entity is a resident of Mexico if it is
organized under the laws of Mexico or if it maintains the principal
administration of its business or the effective location of its management in
Mexico. A Mexican citizen is presumed to be a resident of Mexico for tax
purposes unless such person or entity can demonstrate otherwise. If a legal
entity or an individual is deemed to have a permanent establishment in Mexico
for tax purposes, such legal entity or individual shall be required to pay
taxes in Mexico on income attributable to such permanent establishment, in
accordance with relevant tax provisions. A non-resident of Mexico is a legal
entity or individual that does not satisfy the requirements to be considered a
resident of Mexico for Mexican federal income tax purposes. U.S. Shareholder
shall have the same meaning ascribed above under the section "Income Tax
Considerations--U.S. Federal Income Tax Considerations."
Taxation of Dividends
Dividends, either in cash or in any other form, paid with respect to
A shares or B shares represented by the CPOs (or in the case of holders who
hold CPOs represented by ADSs), will not be subject to Mexican withholding
tax.
Disposition of CPOs or ADSs
As discussed below, gains on the sale or disposition of CPOs or ADSs
by a holder who is a non-resident of Mexico for tax purposes, generally will
be exempt from Mexican taxation. Deposits of CPOs in exchange for ADSs and
withdrawals of CPOs in exchange for ADSs will not give rise to any Mexican tax
or transfer duties.
The sale or disposition of ADSs by a non-resident of Mexico will not
be subject to Mexican taxes.
Gains from the sale of stock consummated by non-residents of Mexico
through the Mexican Stock Exchange, is generally exempt from Mexican income
taxation. Therefore, gains from the sale of CPOs consummated by nonresidents
of Mexico through the Mexican Stock Exchange is exempt from Mexican income
taxation. If, however, the sale of CPOs is consummated outside the Mexican
Stock Exchange, the sale of CPOs by nonresidents of Mexico may be subject to
Mexican income tax at a rate of 25% of the gross sales price, unless the
seller is a resident of a qualifying country, including, among others, the
United States, appoints a representative in Mexico for income tax purposes
related to the sale and elects to pay Mexican federal income tax, in which
case such tax will be imposed at a rate not to exceed 35% of the gain on the
sale.
Moreover, under the U.S.-Mexico Income Tax Treaty, a U.S.
Shareholder who owns less than 25% of our stock and is otherwise eligible for
benefits under such tax treaty is not subject to Mexican tax on any gain
derived from the disposition of ADSs or CPOs. In the case of non-residents of
Mexico, other than U.S. Shareholders, gains derived from the disposition of
ADSs or CPOs may be exempt, in whole or in part, from Mexican taxation under
provisions of an applicable treaty.
36
Commissions paid in respect of brokerage transactions for the sale
of CPOs on the Mexican Stock Exchange are subject to a value-added tax of 15%.
Deposits and Withdrawals of CPOs
The deposit of CPOs in exchange for ADSs and the withdrawal of CPOs
that were represented by ADSs is not subject to Mexican taxation.
Estate and Gift Taxes
There are no Mexican inheritance, gift, succession or value-added
taxes applicable to the ownership, transfer, exchange or disposition of ADSs
or CPOs by holders that are non-residents of Mexico, although gratuitous
transfers of CPOs may, in some circumstances, cause a Mexican federal tax to
be imposed upon the recipient.
There are no Mexican stamp, issue, registration or similar taxes or
duties payable by holders of ADSs or CPOs.
37
PLAN OF DISTRIBUTION
The ADSs offered hereby may be sold from time to time to purchasers
directly by the selling ADS holders. Alternatively, the selling ADS holders may
from time to time offer the ADSs to or through underwriters, broker/dealers or
agents, who may receive compensation in the form of underwriting discounts,
concessions or commissions from the selling ADS holders or the purchasers of
ADSs for whom they may act as agents. The selling ADS holders and any
underwriters, broker/dealers or agents that participate in the distribution of
ADSs may be deemed to be "underwriters" within the meaning of the Securities Act
of 1933, as amended, and any profit on the sale of ADSs by them or any
discounts, commissions, concessions or other compensation received by any such
underwriter, broker/dealer or agent may be deemed to be underwriting discounts
or commissions under the Securities Act.
The ADSs offered hereby may be sold from time to time in one or more
transactions at fixed prices, at prevailing market prices at the time of sale,
at varying prices determined at the time of sale or at negotiated prices. The
sale of the ADSs may be effected in transactions (i) on any national securities
exchange or quotation service on which the ADSs may be listed or quoted at the
time of sale, (ii) in the over-the-counter market, (iii) in transactions
otherwise than on such exchanges or in the over-the-counter market or (iv)
through the writing of options.
In addition, we may facilitate offers and sales of the ADSs by the
selling ADS holders either directly to purchasers or through an underwritten
offering, in which case we may be a party to the purchase agreement or
underwriting agreement relating to such offers and sales. We may also arrange
for the selling ADS holders to sell a portion of the ADSs to banks or other
financial institutions in connection with new forward transactions or to a trust
in order to hedge our obligations under the new appreciation warrants. In the
event any selling ADS holder sells a portion of the ADSs to such new bank or
trust, such new bank or trust may resell such ADSs under this registration
statement from time to time, in one or more offerings, pursuant to an
appropriate prospectus supplement.
A selling ADS holder may also distribute ADSs offered hereby upon
settlement of exchangeable securities it issues or through one or more special
purpose entities, which may distribute their own securities and purchase the
ADSs from the selling ADS holder either when it issues those securities or on a
future date under forward purchase arrangements it enters into when it issues
those securities. In connection with an offering of securities of such a special
purpose entity, the selling ADS holders may also enter into securities loan
arrangements with the underwriters of the entity's securities in order to
facilitate such underwriters' market-making activities in the entity's
securities.
At the time a particular offering of the ADSs is made, a prospectus
supplement, if required, will be distributed which will set forth the aggregate
amount of ADSs being offered and the terms of the offering, including the name
or names of any underwriters, broker/dealers or agents, any discounts,
commissions and other terms constituting compensation from the selling ADS
holders and any discounts, commissions or concessions allowed or reallowed or
paid to broker/ dealers.
To comply with the securities laws of certain jurisdictions, if
applicable, the ADSs will be offered or sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain jurisdictions
the ADSs may not be offered or sold unless they have been registered or
qualified for sale in such jurisdictions or any exemption from registration or
qualification is available and is complied with.
The selling ADS holders will be subject to applicable provisions of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder, which provisions may limit the timing of purchases and sales of any
of the ADSs by the selling ADS holders. The foregoing may affect the
marketability of the ADSs.
38
VALIDITY OF THE SECURITIES
Several legal matters in connection with the CPOs underlying the ADSs
have been passed upon for CEMEX by Lic. Ramiro G. Villarreal, General Counsel
of CEMEX. Mr. Villarreal, our General Counsel and secretary of our board of
directors, is a holder of our securities, and is a participant in our stock
option programs.
EXPERTS
The consolidated financial statements and schedules of CEMEX as of
December 31, 2002 and 2001, and for each of the years in the three-year period
ended December 31, 2002, have been incorporated by reference into this
prospectus in reliance upon the reports of KPMG Cardenas Dosal, S.C. and
PricewaterhouseCoopers, independent accountants, appearing in CEMEX's annual
report on Form 20-F for the fiscal year ended December 31, 2002, and upon the
authority of those firms as experts in accounting and auditing.
39
================================================================================
25,457,378 American Depositary Shares
Each Representing Five
Ordinary Participation Certificates
of
CEMEX, S.A. de C.V.
[CEMEX GRAPHICAL LOGO]
-----------------------
PROSPECTUS
-----------------------
August 27, 2003
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 8. Indemnification of Directors and Officers
The directors and officers of CEMEX are afforded indemnification
pursuant to Mexican law for loss or damage suffered as a result of the
performance of each of their respective mandates, as such mandate is specified
in CEMEX's by-laws or any power of attorney granted by CEMEX. Both Article 2472
of the Civil Code for the State of Nuevo Leon and Article 2578 of the Civil Code
for the Federal District (applied in Mexico for federal matters) provide that a
corporation must indemnify its agents for all damages and losses that such agent
suffers as a result of the performance of his mandate, and which are not the
result of the fault or negligence of the agent. CEMEX's by-laws specifically
afford the officers of CEMEX indemnification from any loss or damage they may
suffer as a result of acts performed within the terms of each of their
respective mandates, as conferred by the by-laws and in accordance with CEMEX's
corporate purpose. CEMEX maintains, at its expense, a policy of insurance which
insures its directors and officers, subject to certain exclusions and deductions
as are usual in such insurance policies, against certain liabilities which may
be incurred in those capacities.
Item 9. Exhibits and Financial Statement Schedules
The following is a list of all exhibits filed as a part of the
registration statement on Form F-3, including those incorporated by reference:
3.1 Amended and Restated By-laws of CEMEX, S.A. de C.V. ****
4.1 Form of Trust Agreement between CEMEX, S.A. de C.V. and Banco
Nacional de Mexico, S.A. regarding the CPOs*
4.2 Form of CPO Certificate*
4.3 Second Amended and Restated Deposit Agreement (A and B share CPOs),
dated as of August 10, 1999, among CEMEX, S.A. de C.V., Citibank,
N.A. and holders and beneficial owners of American Depositary
Shares**
4.4 Form of American Depositary Receipt evidencing American Depositary
Shares (included in Exhibit 4.3)**
4.5 Form of Certificate for shares of Series A Common Stock of CEMEX,
S.A. de C.V.*
4.6 Form of Certificate for shares of Series B Common Stock of CEMEX,
S.A. de C.V.*
5.1 Opinion of Lic. Ramiro G. Villarreal, General Counsel of CEMEX,
regarding legality of the CPOs***
8.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP, with respect to
material U.S. federal tax matters***
8.2 Opinion of C.P. Eutimio Medellin, Corporate Tax Manager of CEMEX,
with respect to material Mexican federal tax matters***
23.1 Consent of KPMG Cardenas Dosal, S.C.****
23.2 Consent of PricewaterhouseCoopers****
23.3 Consent of Lic. Ramiro G. Villarreal, General Counsel of CEMEX
(included in the opinion filed as Exhibit 5.1)***
24.1 Powers of Attorney (included in the signature page of this
Registration Statement)***
----------------
* Incorporated by reference to CEMEX's Registration Statement on Form
F-4 (Registration No. 333-10682), filed with the Securities and
Exchange Commission on August 10, 1999.
** Incorporated by reference to Amendment No. 2 to CEMEX's Registration
Statement on Form F-4 (Registration No. 333-13976), filed with the
Securities and Exchange Commission on November 19, 2001.
*** Previously filed.
**** Filed herewith.
II-1
Item 10. Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or
the most recent post- effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(4) To file a post-effective amendment to the registration
statement to include any financial statements required by Item 8.A. of
Form 20-F at the start of any delayed offering or throughout a
continuous offering. Financial statements and information otherwise
required by Section 10(a)(3) of the Act need not be furnished,
provided, that the registrant includes in the prospectus, by means of a
post-effective amendment, financial statements required pursuant to
this paragraph (a)(4) and other information necessary to ensure that
all other information in the prospectus is at least as current as the
date of those financial statements. Notwithstanding the foregoing, with
respect to the registration statements on Form F-3, a post-effective
amendment need not be filed to include financial statements and
information required by Section 10(a)(3) of the Act or Rule 3-19 of
this chapter if such financial statements and information are contained
in periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Form
F-3.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
II-2
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions referred to in Item 8
hereof, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
(unless, in the opinion of its counsel, the matter has been settled by
controlling precedent) submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form F-3, and has duly caused this
Post-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Garza Garcia, Nuevo
Leon, Mexico on August 27, 2003.
CEMEX, S.A. de C.V.
By: /s/ Hector Medina
------------------------------------------
Name: Hector Medina
Title: Executive Vice President of Planning
and Finance
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registrant Statement has been signed by the
following persons in the capacities and on the dates indicated.
Signatures Title Date
---------- ----- ----
Chief Executive Officer and Chairman August 27, 2003
* of the Board of Directors
---------------------------------- (Principal Executive Officer)
Lorenzo H. Zambrano
* Director August 27, 2003
----------------------------------
Armando J. Garcia Segovia
* Director August 27, 2003
----------------------------------
Lorenzo Milmo Zambrano
* Director August 27, 2003
----------------------------------
Rodolfo Garcia Muriel
* Director August 27, 2003
----------------------------------
Rogelio Zambrano Lozano
* Director August 27, 2003
----------------------------------
Roberto Zambrano Villarreal
* Director August 27, 2003
----------------------------------
Bernardo Quintana Isaac
* Director August 27, 2003
----------------------------------
Dionisio Garza Medina
* Director August 27, 2003
----------------------------------
Alfonso Romo Garza
II-4
Director , 2003
----------------------------------
Mauricio Zambrano Villarreal
Director , 2003
----------------------------------
Tomas Brittingham Longoria
/s/ Hector Medina Executive Vice President of Planning August 27, 2003
---------------------------------- and Finance (Principal
Hector Medina Financial Officer)
* Chief Accounting Officer August 27, 2003
---------------------------------- (Principal Accounting Officer)
Rafael Garza
* Authorized Representative in August 27, 2003
---------------------------------- the United States
Gilberto Perez
* By /s/ Hector Medina August 27, 2003
---------------------------- ------------------
Hector Medina
Attorney-in-fact
II-5
Exhibit Index
Exhibit
No. Description
------- -----------
3.1 Amended and Restated By-laws of CEMEX, S.A. de C.V. ****
4.1 Form of Trust Agreement between CEMEX, S.A. de C.V. and Banco
Nacional de Mexico, S.A. regarding the CPOs*
4.2 Form of CPO Certificate*
4.3 Second Amended and Restated Deposit Agreement (A and B share CPOs),
dated as of August 10, 1999, among CEMEX, S.A. de C.V., Citibank,
N.A. and holders and beneficial owners of American Depositary
Shares**
4.4 Form of American Depositary Receipt evidencing American Depositary
Shares (included in Exhibit 4.3)**
4.5 Form of Certificate for shares of Series A Common Stock of CEMEX,
S.A. de C.V.*
4.6 Form of Certificate for shares of Series B Common Stock of CEMEX,
S.A. de C.V.*
5.1 Opinion of Lic. Ramiro G. Villarreal, General Counsel of CEMEX,
regarding legality of the CPOs***
8.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP, with respect to
material U.S. federal tax matters***
8.2 Opinion of C.P. Eutimio Medellin, Corporate Tax Manager of CEMEX,
with respect to material Mexican federal tax matters***
23.1 Consent of KPMG Cardenas Dosal, S.C.****
23.2 Consent of PricewaterhouseCoopers****
23.3 Consent of Lic. Ramiro G. Villarreal, General Counsel of CEMEX
(included in the opinion filed as Exhibit 5.1)***
24.1 Powers of Attorney (included in the signature page of this
Registration Statement)***
----------------
* Incorporated by reference to CEMEX's Registration Statement on Form
F-4 (Registration No. 333-10682), filed with the Securities and
Exchange Commission on August 10, 1999.
** Incorporated by reference to Amendment No. 2 to CEMEX's Registration
Statement on Form F-4 (Registration No. 333-13976), filed with the
Securities and Exchange Commission on November 19, 2001.
*** Previously filed.
**** Filed herewith.