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CONTRACT No. 110910-1
TRUST AGREEMENT ENTERED INTO BY THE PARTY OF THE FIRST PART, BANCO NACIONAL DE
MEXICO, S.A., IN ITS CAPACITY AS TRUSTEE ("TRUSTEE), REPRESENTED IN THIS LEGAL
ACT BY ITS TRUST REPRESENTATIVE, XXXXX DE LOS ANGELES XXXXXXXXXX XXXXX AND BY
ITS SPECIAL ATTORNEY IN FACT, XXXX XXXXX XXXX XXXXXXX; AND BY THE PARTY OF THE
SECOND PART, CEMEX, S.A. DE C.V., (CEMEX) AS TRUSTOR/BENEFICIARY, REPRESENTED IN
THIS LEGAL ACT BY ITS ATTORNEY IN FACT, XXXXXXX X. XXXXXXXX, ENGINEER, PURSUANT
TO THE FOLLOWING DEFINITIONS, RECITALS AND SECTIONS:
--DEFINITIONS--
(a) CEMEX: Cemex, S.A. de C.V.
(b) THE TRUSTEE Banco Nacional de Mexico, S.A.
(c) SHARES: Treasury stock or stock fully paid in,
representing common Capital Stock, both equity
capital and variable equity, of Cemex, S.A. de
C.V.
(d) ELIGIBLE PERSONS: Members of the Board of Directors and Statutory
Auditors (Regular and Alternate) of Cemex, S.A.
de C.V. and Employees and Officers of any
Corporation, corporate entity, trust or any
legal entity controlled by CEMEX, and in the
case of the Employees and Officers, provided
that they are appointed by the Trust's Technical
Committee. For these purposes, "controlled"
refers to any corporation, corporate entity or
legal entity more than fifty percent (50%) of
whose common shares representing its Capital
Stock with voting rights
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are held by Cemex, S.A. de C.V., directly or
through one or more controlled corporations, or,
in the case of Trusts, those in which Cemex,
S.A. de C.V. or any other subsidiary is the
Trustor/Beneficiary, or, if it is not the
Beneficiary, there is no designated Beneficiary
that is not a controlled corporation, allowing
Cemex, S.A. de C.V. or any controlled
corporation to reacquire the trust assets, and
in any other case in which CEMEX or any other
subsidiary entity has the authority or the power
to direct management and appoint a majority of
board members ( "CONTROLLED CORPORATION).
(e) OPTIONS [types]: Securities with options: "warrants," "puts,"
"calls" and any other instrument or security
that confers on the Trustee the right to
purchase SHARES on a set date at a predetermined
price.
(f) SHARES PURCHASED: Shares purchased or subscribed (which
hereinafter means subscribed and paid in)
through exercise of OPTION RIGHTS by ELIGIBLE
PERSONS.
(g) CONTROLLED CORPORATION: As defined herein.
(h) OPTIONS [the rights]: Rights issued by the Trustee in exchange for the
consideration indicated by the Technical
Committee and (issuance premium) pursuant to the
other terms and conditions indicated by that
Committee, adjusted to the stipulations of this
Agreement;
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granting the option to subscribe or purchase
SHARES, at the EXERCISE PRICE indicated by the
Technical Committee.
(i) EXERCISE PRICE: The Price set in OPTIONS for purchasing or
subscribing SHARES to which the OPTIONS refer.
--RECITALS--
(A) CEMEX STATES THAT:
I.- Through the Regular Shareholders' Meeting held on April 27,
1995, it was resolved that there would be an Increase in
Capital Stock, in its variable portion, through issuance of
217,000,000 (two hundred seventeen million) common registered
shares, no par value stated, which heretofore were Treasury
Stock.
II.- In the Shareholders' Meeting mentioned in the prior item, the
Shareholders waived the preemptive right granted them by the
General Law on Corporations and authorized the SHARES to be
subscribed by ELIGIBLE PERSONS or by the Trustee.
III- The SHARES will be subscribed or purchased by ELIGIBLE
PERSONS, subject to fulfillment of several terms and
conditions.
IV- In order to guarantee to ELIGIBLE PERSONS that satisfy the
terms and conditions stipulated for this purpose their right
to subscribe SHARES, CEMEX wishes to legally record this
Agreement.
V- It is a Corporation established pursuant to the Laws in effect
in Mexico, through Notarial Instrument No. 94, issued before
the former Public Notary of Monterrey, Nuevo Xxxx, Xxxxxx
Xxxxxx, on May 28, 1920, and recorded under the number 21,
Folios 157 to 186,
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Volume 16, Book No. 3, Second Ledger, in the Public Registry
of Property and Commerce of the First District Seat of the
State on June 11, 1920.
VI.- That the Power of Attorney granted to its legal
representative, Xxxxxxx X. Xxxxxxxx, has not been revoked and
was legally established through Notarial Instrument No. 3,996,
dated June 27, 1989, issued and certified by Xxxxxx Xxxxx
Xxxxxx Xxxxxxxx, Alternate Public Notary assigned to the
Office of Public Notary No. 70, practicing in the municipality
of Monterrey, N.L., registered under number 3820, Volume
191-77, Book No. 4, Third Ledger, Miscellaneous Legal Acts and
Contracts, Commercial Section, dated August 30, 1989, in the
Public Registry of Property and Commerce of Monterrey, Nuevo
Xxxx.
(B) THE TRUSTEE STATES THAT:
I- It is a Corporation authorized to carry out this type of
transaction pursuant to the provisions of the Law on Credit
Institutions [Ley de Instituciones de Credito].
II- Pursuant to the provisions of Article 8, paragraph II of the
Financial Group Regulation Act [Ley para Regular las
Agrupaciones Financieras], it confirms that it is a member of
the Grupo Financiero Banamex-Accival, S.A. de C.V.
III It is willing to enter into this Trust Agreement as the
Trustee, performing this duty pursuant to the terms and
conditions agreed upon in this Agreement.
IV- Its legal representatives have the power required to bind it
under the terms and conditions of this Agreement, and said
power has not been revoked or restricted in any way
whatsoever.
(C) CEMEX and THE TRUSTEE STATE THAT:
I- That any CONTROLLED CORPORATION contributing SHARES or funds
applied to the purchase or subscription of SHARES -- to be
included in the Trust Assets -- may be added to this Agreement
as Trustors by signing the LETTER OF ASSENT.
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--SECTIONS--
ONE: PARTIES TO THE TRUST
THE FOLLOWING ARE PARTIES TO THIS AGREEMENT:
TRUSTORS: CEMEX, S.A. de C.V. AND ANY CONTROLLED
CORPORATION THAT IS ADDED TO THIS AGREEMENT BY
CONTRIBUTING SHARES OR FUNDS.
TRUSTEE: BANCO NACIONAL DE MEXICO, S.A.
BENEFICIARIES: Primary Beneficiaries: CEMEX, with reference to
amounts derived from the sale of its OPTIONS and
the subscription and sale, as the case may be,
of its SHARES, and (ii) any CONTROLLED
CORPORATION that is added to the Trust, with
regard to the proceeds of the price of the
OPTIONS and the sale of SHARES.
Secondary Beneficiaries: the ELIGIBLE PERSONS
with regard to the SHARES PURCHASED, the
proceeds of the sale thereof, and the exercise
of ownership rights inherent therein.
TWO: TRUST ASSETS
The Trust Assets of the Trust are made up of: (i) The SHARES;
(ii) the OPTIONS purchased by the Trust; (iii) The
contribution made together with this Agreement by Cemex, S.A.
de C.V. of the sum of N$ 1,000.00 (ONE THOUSAND NEW PESOS
00/100, Mexican Currency); (iv) The price to be paid for
OPTIONS and the EXERCISE PRICE,
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as well as the yield, as the case may be, from investment of the funds
that make up the trust assets; (v) The funds received through
financing granted, as the case may be; (vi) SHARES that may have been
purchased or subscribed by funds from the Trust Assets, or that are
contributed by CEMEX or any CONTROLLED CORPORATION; and (vii) SHARES
that may have been purchased or subscribed by ELIGIBLE PERSONS based on
the exercise of OPTIONS.
THREE: PURPOSES OF THE TRUST
The purposes of this Trust are as follows:
(a) That THE TRUSTEE maintain ownership, title and management of
the trust assets, to fulfill the purposes set forth herein.
(b) That THE TRUSTEE confer OPTIONS upon ELIGIBLE PERSONS,
pursuant to this agreement and to the terms and conditions
determined by the Technical Committee constituted herein, so
that they may subscribe or purchase the SHARES (subsequently
called SHARES PURCHASED).
(c) That THE TRUSTEE apply the funds it receives by granting
OPTIONS and payment of the EXERCISE PRICE through
contributions to the Trust; through financing granted, as well
as through yields derived from investments carried out and
financing granted, as instructed by the Technical Committee.
(d) That, pursuant to the instructions of the Technical Committee
or, as the case may be, of any trustor responsible for funds
that said trustor has contributed for this purpose, SHARES
will be purchased or subscribed.
(e) That the Trustee, in accordance with instructions received
from the Technical Committee, allow TRUSTORS to enter into
contracts and grant financing with the trust assets;
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similarly, in accordance with the instructions of the
same Technical Committee, that the Trustee decide on
the use of funds from financing granted for specific
purposes and take steps to recover, negotiate or
restructure the above-mentioned loans.
(f) That the Trustee subscribe (for the account of ELIGIBLE
PERSONS) the Treasury Shares issued by CEMEX, S.A. de C.V.
that were indicated by the ELIGIBLE PERSONS in exercise of the
EXERCISE PRICE. The Trustee may deposit said Shares in INDEVAL
pursuant to the instructions from the Technical Committee.
(g) That the Trustee purchase OPTIONS, and, as the case may be,
through payment of the EXERCISE PRICE purchase or subscribe
SHARES.
(h) In the event that, pursuant to the stipulations of this
instrument and the terms and conditions agreed upon in the
instrument in which they are legally recorded, ELIGIBLE
PERSONS may exercise their OPTIONS the Trustee may take steps
to sell or subscribe the SHARES, which will remain within the
Trust assets, to be used for the purposes indicated for these
SHARES PURCHASED.
(i) Pursuant to the instructions received by the Technical
Committee, authorize assignments of OPTIONS already issued to
the ELIGIBLE PERSONS.
(j) Pursuant to instructions received from the ELIGIBLE PERSONS,
take steps to sell the SHARES PURCHASED, applying the proceeds
from loans paid off that had been granted to said persons and
also take steps to sell if, upon maturity of those loans, they
were not paid in full, delivering the amount remaining to said
persons, once all expenses and fees are covered.
(k) Pursuant to the instructions received by the Technical
Committee, the Trustee exercises the ownership rights and the
rights inherent in SHARES and OPTIONS that make up a portion
of the trust assets.
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With regard to SHARES PURCHASED, the Technical Committee will
only give instructions regarding the exercise of the right to
vote. Regarding the other rights, the Trustee will follow the
instructions of the ELIGIBLE PERSONS.
(l) That, with the exception of SHARES PURCHASED, pursuant to
the instructions of the Technical Committee, the Trustee
sells, assigns, transfers, enters into repurchase agreements,
gives or places in trust, or carries out any transaction or
enters into any contract of a commercial or civil nature,
in Mexico or abroad, with regard to the SHARES or OPTIONS.
FOUR: TECHNICAL COMMITTEE
Under the terms and for the purposes set forth in Article 80
of the Credit Institutions Act, with this legal act, a
Technical Committee is established, according to the following
rules:
(a) Composition: The Technical Committee will be made up
of three persons, and CEMEX appoints for these
purposes:
(i) XXXXXXX X. XXXXXXXX ________________________
(ii) C.P. XXXXXXX X. XXXXXXXXX __________________
(iii) XXXXXXX X. XXXXXX S. _______________________
Xxxxxxx X. Xxxxxxxx will be Chairman. The members of the
Technical Committee appointed herein may only be removed or
replaced as set forth in this section, except in the case of
death, total disability - declared by law - or express,
written resignation. The chairman may not be removed. As
required, the Chairman will submit to the Trustee the related
documents, and the Trustee will convey these to CEMEX so that
it may make the related new appointment.
The Committee Chairman may freely replace or remove the other
two members; for these purposes, he will inform the Trustee in
this regard. Once the Trustee has received the information,
the person appointed is
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deemed to have assumed the related duties, and the person
replaced ceases to carry them out.
(b) Operation: The Technical Committee will meet as often as is
necessary, and no formal meeting is required. It is sufficient
for a written memorandum to be sent, signed by at least two
members, one of whom must be the Chairman, clearly setting forth
the agreements and decisions made. For them to be deemed valid,
the Chairman must send this memorandum to the Trustee, and once
the Trustee has received it, the Committee will be subsequently
be held harmless for all liability for its related actions, as is
set forth in article 80 of the General Law on Credit
Institutions.
In the event that the Technical Committee agrees to meet at a
given time and place, the Trustee may attend the meeting, without
a vote.
The decisions of the Technical Committee will only be valid if
they are approved by the Chairman and one other member.
(c) Powers: The Technical Committee will decide on those matters
which, in accordance with the stipulations of this agreement,
must be submitted for its consideration and on other matters
submitted by the Trustee for its consideration.
FIVE: OPTIONS.
The Technical Committee will be the body to determine who will be
deemed ELIGIBLE PERSONS in addition to members of the Board of
Directors (Statutory Auditors, whether regular or alternate) of CEMEX,
S.A. de C.V., who are deemed ELIGIBLE for purposes of this agreement.
The Trustee, through authorization of the Technical Committee, will
grant and will legally record the granting of OPTIONS with the
ELIGIBLE PERSONS, proceeding pursuant to the following criteria:
(a) OPTIONS will be granted whenever the Technical Committee so
determines.
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(b) Each OPTION will specify the number of SHARES that may be
subscribed or purchased by the ELIGIBLE PERSON; that number will
be determined by multiplying the base salary received by the
ELIGIBLE PERSON (payroll together with benefits as is determined
by the Technical Committee) by a percentage set by the Technical
Committee, itself, and the result will be divided by the per
share market value of the SHARES. The market value will be
determined by the Technical Committee, taking into account the
share price of the SHARES listed on the Mexican Securities
Exchange.
(c) OPTIONS assigned may be exercised within a period of (10) ten
years counted from the year immediately following that in which
they are granted and legally recorded. An ELIGIBLE PERSON may,
starting in the twelfth month following that in which the OPTIONS
were granted exercise only 25% of the OPTIONS per year of the
OPTIONS granted him. (In other words, he may purchase or
subscribe 25% of the total number of shares covered by the
OPTIONS) Subsequently, that is, starting in the (4th) fourth year
after the date on which granting of the OPTIONS was legally
recorded, until the final year of the 10-year period, he may
exercise all the OPTIONS not exercised. In the event that the
ELIGIBLE PERSON dies, is declared to be under injunction or is
permanently disabled -- through court decision, retires, is
dismissed without cause, or retires for reasons attributable to
the employer from his position at CEMEX or any of the CONTROLLED
CORPORATIONS, once these events are effectively confirmed to the
Trustee, the OPTIONS assigned will be 100% exercisable for a
maximum period of (3) three years counted from the time when the
Trustee states his acceptance.
In the event of dismissal with cause of an employee at CEMEX or
any of its Controlled Corporations, the Technical Committee will
so advise the Trustee, and the Trustee will notify the related
ELIGIBLE PERSON that he as a period of (30) thirty days to
exercise the OPTIONS assigned to him, with the understanding that
if the
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dismissal was within the (4) four years following that in which
the OPTIONS were assigned, they could only be exercised for
options assigned within the aforementioned (4) four years, the
percentage to which he had a right in accordance with the number
of years elapsed since the OPTIONS were assigned, through the
date on which his work contract was terminated, and said OPTIONS
are applicable insofar as they have not yet been exercised, which
is understood, as a matter of law.
(d) OPTIONS not exercised within the period stipulated will elapse,
and will be null and void. The calculation of periods stipulated
will be based on calendar days.
(e) As of their appointment, members of the Board of Directors and
Statutory Auditors (Regular and Alternate) of CEMEX, S.A. de
C.V., will be assigned OPTIONS as indicated by the Technical
Committee, and subsections (a), (c) and (d) above will not be
applicable. Purchases through the exercise of OPTIONS and sales
of the shares purchased will be carried out on predetermined
days.
SIX: OBLIGATIONS OF THE TRUSTORS.
(a): CEMEX and/or the other CONTROLLED CORPORATIONS that are trustors,
agree to maintain an adequate number of SHARES in the Trust
Assets to cover the exercise of OPTIONS. For such purposes, they
may purchase OPTIONS or contribute funds required or obtain the
necessary financing, in accordance with the terms and conditions
of this agreement, to purchase or subscribe the SHARES required.
(b): In the event that the issuer of the SHARES agrees to
consolidation, restructuring, spinning off or splitting of
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its capital stock or the replacement of the securities that cover
them, the OPTIONS already granted will be exercisable with regard
to the number of SHARES that results, taking into account the new
shares issued to replace them or to be added for each of the
prior shares. For these purposes, the Trustors (CEMEX and the
CONTROLLED CORPORATIONS) agree, in the event that the SHARES were
not contributed or purchased by the Trustee, to contribute the
SHARES or funds required for their purchase equivalent to the
SHARES with regard to which the OPTIONS assigned were
exercisable.
(c): In the event of Capital Increases through Capitalization of
Reserves, the OPTIONS already granted will be exercisable with
regard to the number of SHARES that will result, including those
issued per outstanding share.
In the event that the Beneficiary has not contributed the SHARES,
the Trustors agree to make the necessary contributions in order
to back the exercise of OPTIONS under the terms and conditions
stipulated.
***************************************************
SEVEN: SALE AND PAYING IN OF SHARES PURCHASED.
Only with the authorization of the Technical Committee may SHARES
PURCHASED be delivered to ELIGIBLE PERSONS, provided that the Person
is not liable for any debt derived from the exercise of his OPTIONS.
For purposes of the sale of the SHARES PURCHASED, in the event that
the Eligible Person is liable for debt derived from the purchasing of
said shares, the Technical Committee, within (15) fifteen subsequent
days, will proceed to sell the SHARES PURCHASED on the Mexican
Securities Exchange or in a recognized market, and the proceeds will
be applied to payment of the debt, with the remaining amount credited
to the related ELIGIBLE PERSON(S).
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In any other event, they may only give instructions to sell SHARES
PURCHASED at intervals of (30) thirty days starting from the time when
they are purchased, and the first instructions may be given within (5)
five days of their purchase.
EIGHT: POWERS OF THE TRUSTEE.
The Trustee will have all the powers required to carry out the
purposes of this Trust stipulated in section THREE including, but not
limited to, the powers and obligations to which Article 356 of the
General Law of Securities and Credit Transactions refers.
Specifically, the Trustee has the authority to xxxxx xxxxxx of
attorney in favor of the persons designated by the Technical
Committee, so that in the regular Shareholders' Meetings of CEMEX,
said attorneys in fact may exercise the corporate rights inherent in
SHARES and SHARES PURCHASED.
NINE: SUBSCRIPTION OF NEW SHARES AND EXERCISE OF OPTIONS.
(i) In the event that CEMEX increases its Capital Stock through new
contributions, CEMEX will notify the Technical Committee the day
immediately after that on which the Board of Directors approves
the related proposal for submission to the regular Shareholders'
Meeting. The Technical Committee will notify the Trustors that
have contributed SHARES and SHARES PURCHASED to advise them that
they have the right to subscribe the shares issued if the capital
increase is approved, as the case may be, in the proportion that
the SHARES and the SHARES PURCHASED represent the Capital Stock
of CEMEX, of which it is holder through the Trustee, and, as the
case may be, as is set forth in the Corporate Bylaws of CEMEX and
in the resolutions adopted by the Shareholders' Meeting.
Trustors who wish to subscribe a capital increase must provide
the Trustee with the necessary funds (2) two business days in
advance of the date on which the period
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for exercising preemptive rights expires.
In order to exercise the rights of OPTIONS [obtained by Trustee],
and OPTIONS [granted by Trustee], a person will proceed as
follows: (a) OPTIONS [obtained by Trustee]: When they are
purchased, the Trustee will inform the Technical Committee of the
related terms and conditions. The Technical Committee must notify
the Trustee (2) two business days before the period set for the
exercise, so the inherent rights may be exercised. The Technical
Committee will handle this, providing the Trust or, as the case
may be, authorizing the use of the funds required for this
purpose from Trust Assets; OPTIONS [granted by Trustee]: In this
case, the ELIGIBLE PERSONS that are holders of these Rights must
deliver the required amounts to the Trustee in order to cover the
EXERCISE PRICE, on the day set as the exercise date, at the
latest. The Trustee, pursuant to instructions given to it by the
Technical Committee, may grant loans to the holders of the
OPTIONS so that they may cover the EXERCISE PRICE.
TEN: DOCUMENTATION OF OPTIONS [granted by Trustee]:
As determined by the Trust's Technical Committee and subject to
the legal provisions applicable, OPTIONS will be issued giving
the right to purchase (or subscribe) SHARES.
In a written document, the Trust will make an OFFER to ELIGIBLE
PERSONS, offering SHARES for them to buy or subscribe. The
ELIGIBLE PERSONS, to whom the Offer is made must confirm their
acceptance, without reservations, in the document submitted to
him/them by the Trustee, adhering as Trustors to the terms and
conditions of this Agreement applicable to SHARES PURCHASED.
The Offer will contain the number of SHARES, the purchase or
subscription price and the periods and conditions for carrying
out the purchase or subscription. The ELIGIBLE PERSONS will pay a
premium (to be determined by the Technical Committee) to the
Trustee, once the Offer is accepted.
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The Trustee's Offer will indicate the manner and terms in which
the premium and the EXERCISE PRICE must be paid, and it will
state that the purchase or subscription will be subject to the
Trust Assets having a sufficient number of SHARES. It will also
include the stipulations contained in Sections THREE and SIX of
this Agreement and the condition that SHARES PURCHASED will
remain part of the Trust Assets, and that the voting rights may
be exercised as indicated by the Technical Committee.
To this end, the provisions contained in articles 1804, 1805,
1806, 1807, 1808 and 1810 of the Federal Civil Code will be
applicable.
ELEVEN: TERM.
This Agreement will have a maximum term of (30) thirty years
pursuant to the provisions of Article 359 of the General Law on
Securities and Credit Transactions. Notwithstanding the
foregoing, it may be cancelled by agreement of the Trustors, who
reserve that right, for all legal purposes that may arise.
This Trust may not be cancelled as long as OPTIONS or loans
granted to or by the Trust are outstanding, or payment thereof
has not been made in full.
Upon termination of the Trust, the Trustee will return the
property of the Trust Assets to the Trustors who have the right
thereto, pursuant to the records and controls that the Trustee
must maintain.
TWELVE: CONTROL.
The Trustee must maintain an individual record for each Trustor,
which allows it to identify the portion of the Trust Assets
related to each Trustor.
In the event of loans granted, the Trust Assets, with the
exception of SHARES PURCHASED and their gains or yields, will be
proportionally liable in accordance with the
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proportion contributed by each Trustor. The same criterion to
which the payment of Trust Assets refers, will be applied in
granting loans
All transactions related to administration and custody of the
SHARES and SHARES PURCHASED will be effected through the
Institution authorized for deposits of securities.
SHARES PURCHASED and OPTIONS may not be assigned, pledged or
transferred in any way nor may the inherent or resulting rights
be assigned without express consent from the Technical Committee.
THIRTEEN: PROHIBITIONS.
Section XIX, subsection (b) of Article 106 of the Law on Credit
Institutions precisely sets forth the following:
"Article 106. Credit Institutions are prohibited from:
"XIX...Carrying out transactions referred to in Section XV of
Article 46 of this Law:
b) Assuming liability toward trustors, principals or assignors
for default of their borrowers, for the loans they grant, or, or
default by those who issue the loans, for the securities they
purchase, unless it is through their fault, as is set forth in
the final part of Article 356 of the General Law on Securities
and Credit Transactions, or guaranteeing returns on the funds
whose investment is entrusted to them.
If, upon termination of the trust, commission or brokerage
established for granting loans, they have not been paid off by
the borrowers, the institution must transfer them to the trustor
or beneficiary, as the case may be, or to the principal or
assignor, refraining from covering these amounts.
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Any agreement contrary to the provisions in the two prior
paragraphs will not have any legal effect whatsoever.
The final part of Article 356 (three hundred fifty-six) of the
General Law on Securities and Credit Transactions obligates the
trustee to carry out his duty pursuant to the contract
stipulations, which is to act in a reasonable manner, assuming
liability for the losses or a damaged reputation if the assets
and rights were damaged through his fault.
FOURTEEN: THE TRUSTEE'S RESPONSIBILITY
It is expressly agreed that the Trustee will be liable for the
obligations that result from signing the Trust, only to the
extent of the Trust assets. The Trustee must include this
stipulation in the documents and contracts it signs in carrying
out the Trust. The Trustee will be held harmless from any
liability derived from transactions performed in carrying out the
instructions received from the Technical Committee, and it will
not be obligated to carry out said instructions if they are
contrary to the legal nature or purposes of the Trust. Similarly,
it is agreed that the Trustee will not incur any liability
whatsoever whenever -- because it did not furnish the funds
required for this purpose in a timely manner -- shares issued by
CEMEX by virtue of an increase in capital stock were not
subscribed, or the rights inherent in the OPTIONS not exercised,
pursuant to the provisions set therein.
When, in order to carry out the purposes of the Trust, it is
necessary to carry out urgent transactions whose omission could
significantly damage the Trust Assets, if it is impossible to
convene the Technical Committee, the Fiduciary may act on its
discretion, by way of exception, always acting in accordance with
sound banking practices.
The Trustors reserve no rights whatsoever with respect to Trust
Assets, while the Beneficiaries have only those rights that
expressly result from the terms and conditions of this Agreement,
and there no rights, and none created herein, in favor of any
person that is not
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a Beneficiary, under the terms of articles 351 and 355 of the
General Law on Securities and Credit Transactions.
FIFTEEN: THIRD-PARTY TRANSACTIONS.
The Trustee will not be liable in any way whatsoever to Trustors
or Beneficiaries for events or transactions with third parties or
authorities who impede and add to the difficulties of carrying
out the purposes of this Trust, or for actions taken to carry out
instructions received from the Technical Committee.
SIXTEEN: DEFENSE OF TRUST ASSETS.
In the event of defense of the Trust Assets, the Trustee will
only be obligated to grant a power of attorney to the person(s)
indicated by the Technical Committee, so that the attorney in
fact designated by said Committee undertakes the defense of the
Trust Assets, without the Trustee having any liability whatsoever
for the results of the efforts made by said attorney in fact, or
for the payment of his expenses and fees, because these are for
the account of the Trust Assets, with the understanding that the
power of attorney conferred on the person designated may in no
case be for acts of ownership or to underwrite credit
instruments.
SEVENTEEN: REVOCATION OF AND CHANGES IN THE TRUST.
The Trustor CEMEX, S.A. de C.V., reserves the right that with the
prior authorization of the Technical Committee, it may change the
terms and conditions herein and revoke the Trust, always
respecting the provisions of Section ELEVEN.
EIGHTEEN: TAXES.
The Income Tax applicable to OPTIONS, and the sale of SHARES will
be for the account of the related party, pursuant to the
applicable tax law, and in this case, the Trustee will proceed
under the terms set forth in the tax law at the time when it is
applicable.
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NINETEEN: DISSOLUTION OF THE CORPORATION ISSUING [SHARES].
In the event of dissolution or liquidation of the Corporation
issuing the SHARES and SHARES PURCHASED, the Trustee, bearing no
liability whatsoever, will deliver the Shares and or the
liquidation shares that exist at the time to the person(s) who
legally verify their right to receive them.
TWENTY: TRUSTEE'S FEES.
The Trustee will collect, as fees for the performance of his
duties pursuant to this Agreement, the amounts to be agreed upon
in a separate instrument between the Trustee and CEMEX.
The Trustee's fees, as well as other expenses that must be
disbursed for carrying out this Agreement, will be for the
account of CEMEX.
Also for the account of CEMEX will be all expenses incurred by
the Trustee (including reasonable, documented legal expenses and
fees) in the defense of the Trust Assets as well as the fees and
expenses incurred by CEMEX and the Trustee to carry out the
transactions the Technical Committee instructs the Trustee to
carry out, in fulfillment of the purposes established herein.
TWENTY-ONE: NOTIFICATIONS AND REGISTERED OFFICES.
All communications the parties must deliver to each other under
the terms and conditions of this Agreement must be in writing and
sent to the other party by certified mail with return receipt
requested, telex, telefax or by any other means that assures its
receipt, to the following registered offices:
Trustor: CEMEX, S.A. de C.V.
Xxxxxxx Xxxxxxxxxxxx Xx. 000 Xxx.
00000 Xxxxxxxxx, X.X.
Atencion: Ing. Xxxxxxx X. Xxxxxxxx
20
The Trustee: BANCO NACIONAL DE MEXICO, X.X.
Xxxxxxx Del Xxxxx No. 350 Ote. 1? piso
66220 San Xxxxx Xxxxx Xxxxxx, X.X.
Atencion: Xxxxx de los Angeles Xxxxxxxxxx Xxxxx
TWENTY-TWO: INTERPRETATION AND JURISDICTION.
This Agreement is subject to the laws of the Mexico for its
interpretation and fulfillment. To resolve any dispute that
arises based on this Agreement, the parties expressly agree to be
subject to the jurisdiction of the courts in the City of San
Xxxxx Xxxxx Xxxxxx, X.X., henceforth waiving the right to any
other jurisdiction that may pertain to them by reason of their
registered addresses, present or future, or because of the
location of their property.
This Agreement is signed in the City of Monterrey, Nuevo Xxxx on
the 10th day of the month of August, 1995.
TRUSTOR THE TRUSTEE
s/CEMEX, S.A. de C.V. s/BANCO NACIONAL DE MEXICO,
Represented by: S.A. FIDUCIARY DIVISION
s/XXXXXXX X. XXXXXXXX, Represented by:
Xxxxx de los Angeles Xxxxxxxxxx Xxxxx
and Xxxx Xxxxx Xxxx Xxxxxxx
MODIFYING AGREEMENT
TO TRUST AGREEMENT No.110910-1 BY AND BETWEEN BANCO NACIONAL DE MEXICO, S.A., AS
TRUSTEE (THE "TRUSTEE,") REPRESENTED HEREIN BY ITS TRUST REPRESENTATIVE, XXXXX
DE LOS ANGELES XXXXXXXXXX AND BY ITS SPECIAL ATTORNEY-IN-FACT, XXXX XXXXX XXXX
XXXXXXX, PARTY OF THE FIRST PART; AND CEMEX S.A. DE C.V. ("CEMEX") AS
TRUSTOR/BENEFICIARY, REPRESENTED HEREIN BY ITS GENERAL LEGAL REPRESENTATIVE
XXXXXXX X. XXXXXXXX; PURSUANT TO THE FOLLOWING RECITALS AND CONDITIONS:
--RECITALS--
I. On August 10, 1995, the appearing parties entered into the Trust Contract
referred to in the heading.
II. On April 25, 1996, CEMEX, S.A. DE C.V. held a Special General
Shareholders' Meeting, in which the Option Plan was authorized whereby
"ELIGIBLE PERSONS " would exhibit the value of the "Shares" authorized for
said Plan and which make up part of the Capital Increase approved by the
Regular General Shareholders' Meeting of April 27, 1995.
III. In view of the Resolutions of the Shareholders' Meeting of April 25, 1996,
the appearing parties have decided to execute this agreement to amend
Trust Agreement No. 110910-1, authorized by the Trustee's Technical
Committee, in witness where if its members are signing this Agreement.
IV. In view of the above Recitals, the appearing parties mutually agree to the
following:
--TERMS AND CONDITIONS--
ONE: Other than the provisions modified herein, each and every one of the parts
of Trust Agreement No. 110910-1 are modified and, for the purposes
thereof, the definitions used in that
agreement shall be understood to be incorporated into this Agreement as
if they formed and integral part hereof.
TWO. MODIFICATION OF ARTICLE FIVE of Trust Agreement No. 110910-1, which shall
read as follows:
"FIVE. OPTION RIGHTS":
The Technical Committee shall determine who will be "ELIGIBLE PERSONS" in
addition to the members of the Board of Directors and Commissioners,
Owners, and Alternates, of CEMEX, S.A. DE C.V., who shall be considered
"ELIGIBLE" for the purposes of this agreement. The Trustee, by
authorization of the Technical Committee, shall grant and formalize with
the "ELIGIBLE PERSONS" the granting of the "OPTION RIGHTS," in accordance
with the following criteria:
a) The "OPTION RIGHTS" shall be granted at the time determined by the
Technical Committee.
b) Each "OPTION RIGHT" shall specify the number of "SHARES" that the
"ELIGIBLE PERSON" may subscribe or purchase; said number shall be
determined by the Technical Committee as instructed by the Board of
Directors of Cemex, S.A. de C.V. and taking into account the capacity
of the "ELIGIBLE PERSONS" to perform the work.
c) The "OPTION RIGHTS" assigned may be exercised within a maximum of up
to fifteen (15) years (the "Exercise Period"), which period shall run
from the date the granting of the "OPTION RIGHTS" is formalized.
After 1 (one) year has elapsed (for all purposes, the deadlines or terms
referred to below shall start to run once this year has passed), the
"OPTION RIGHTS" may be exercised and, consequently, "THE SHARES" may be
subscribed or purchased, as instructed by the Technical Committee
defining the parameters, terms, and conditions in accordance with the
following modalities: (i) up to 25% (twenty-five percent) of all the
Shares that include "OPTION RIGHTS" each year during the first working
day of the July; (ii) up to 50% (fifty percent) of all the Shares that
include "OPTION RIGHTS," in the (4th) fourth year during the first
working day of December and the other 50% (fifty percent) when the
"ELIGIBLE PERSON" reaches 55 (fifty-five) years of age or 15 (fifteen)
years of seniority on the job counting from the date on which the "OPTION
RIGHTS" were granted, the first working day of July of the year in which
the first of these events occurs, provided in both cases that 5 (five)
years have passed since the "OPTION RIGHTS" were granted; or (iii) 100%
(one hundred percent) of the "Shares" in the 4th (fourth) year during the
first working day of December, as instructed by the Technical Committee.
Any Shares not purchased on the predetermined dates may be purchased each
month, once the 30 (thirty) days have passed from the predetermined date,
on the corresponding working day and until the exercise period has ended.
For the purpose of the sale of the "Purchased Shares," the Trustee may
take sales orders only within the 15 (fifteen) days
immediately following the purchase or, if applicable on the 15th
(fifteenth) of each month or on the working day immediately following if
the 15th was not a working day.
For "OPTION RIGHTS" assigned before April 1 (first), (1996) nineteen
hundred and ninety-six, the following shall apply.
In the event that the "ELIGIBLE PERSON" dies, is declared under
injunction, or permanently disabled, by means of a court order, or
retires, is fired without case or retires for a reason attributable to
the employer, from his job at "CEMEX" or any of the "CONTROLLED
COMPANIES" and once these events have been reliably documented to the
Trustee, 100% of the assigned "OPTION RIGHTS" may be exercised with in a
maximum of (3) three years, starting from the date the Trustee states its
acceptance and provided the exercise period has not elapsed.
If an employee is fired with cause from his or her job with CEMEX or with
any of the Controlled Companies, the Technical Committee shall notify the
Trustee, who shall notify the corresponding "ELIGIBLE PERSON" that he or
she has (30) thirty days to exercise the assigned "OPTION RIGHTS," with
the understanding that if the firing occurred within the (4) four years
following that in which the "OPTION RIGHTS" were assigned, for those
rights assigned within those (4) four, he or she may exercise only the
percentage vested based on the number of years from the time "OPTION
RIGHTS" until his or
her employment contract is terminated, and the unexercised portion of the
"OPTION RIGHTS," and his "OPTION RIGHTS" in the unexercised portion shall
automatically end.
In any other case, in the event of death, court-ordered injunction,
permanent disability declared by a court order, retirement, firing
without cause or involuntary retirement, with regard to his or her
employment with CEMEX, S.A. DE C.V. or any of the "CONTROLLED COMPANIES,"
the "ELIGIBLE PERSON" or his or her heirs they must be on the
predetermined dates or dates agreed to for the purchase of the Shares.
In the case of voluntary retirement or firing with cause, any "OPTION
RIGHTS" granted under modalities (ii) and (iii) of subparagraph c) of
this article, shall be revoked with no need for a court order.
THREE: MODIFICATION OF ARTICLE TWELVE of Trust Agreement No. 110910-1, so that
it reads as follows:
TWELVE: CONTROLS
The Trustee shall keep the following records and/or controls.
(i) One clearly indicating the number of the "Shares" and whether they are
merely subscribed or, if applicable, whether it involves paid-up
Shares. This record shall be kept up-to-date and, if applicable, the
Certificates shall be replaced as the Shares are purchased in exercise
of the "OPTION RIGHTS."
It must clearly indicate whether the "Purchased Shares" are those
that the Trustee kept subscribed and that corresponded to the
Treasury Shares representing Capital Increases intended for the
Option Plan, or in applicable, if it involves paid-up Shares
previously purchased by the Trustee.
(ii). Another record indicating the "Purchased Shares" belonging to each
"ELIGIBLE PERSON" as s result of its "OPTION RIGHTS" and, of these,
those that have been sold and the remaining balance.
(iii) Any others that are necessary or appropriate or, if applicable, as
instructed by the Technical Committee.
In the case of credits granted, they shall be paid from the Trust Assets,
with the exception of the "PURCHASED SHARES" and their profits and
earnings, in proportion to the portions held by each Trustor. The same
criterion, in regard to the allocation of these Trust Assets shall apply
to the granting of credits.
All transactions pertaining to the management and safekeeping of the
"SHARES" and "PURCHASED SHARES" shall be paid through the Institution
authorized for Depositing Securities.
The "PURCHASED SHARES" or "OPTION RIGHTS," or the rights inherent therein
or resulting therefrom, may not be assigned, given as collateral, or in
any way disposed of without the express consent of the Technical
Committee.
The rights in the Trust of the "ELIGIBLE PERSONS" may not be assigned,
transferred, or given as collateral without the express consent of the
Technical Committee.
FOUR: Except for the provisions expressly modified under this Agreement, all
parts of Trust Agreement No. 110910-1 are ratified, forming an integral
part of the modifications agreed to herein.
This Agreement is executed on June 19 (nineteenth) of 1996 (nineteen
hundred and ninety-six).
THE TRUSTOR THE TRUSTEE
[signature] [signature]
CEMEX, S.A. DE C.V. BANCO NACIONAL DE MEXICO S.A.
Represented by: Trust Division
Xxxxxxx X. Xxxxxxxx Represented by:
Xxxxx de los Angeles Xxxxxxxxxx G.
Xxxx Xxxxx Xxxx T.
TECHNICAL COMMITTEE
[signature] __________________________________
Xxxxxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxxxxx Xxxxxxxx
[signature]
Xxxxxxx X. Xxxxxx Xxxxxxx
[LOGO] Banamex
MODIFYING AGREEMENT
TO TRUST AGREEMENT No. 11910-1 BY AND BETWEEN THE TRADE COMPANIES CEMEX, S.A. DE
C.V. AND CENTRO DISTRIBUIDOR DE CEMENTO, S.A. DE C.V., JOINTLY REPRESENTED BY
XX. XXXXXXX X. XXXXXX XXXXXXX, IN HIS CAPACITY AS THEIR LEGAL REPRESENTATIVE,
PARTY OF THE FIRST PART, HEREINAFTER CALLED THE "TRUSTORS," AND BANCO NACIONAL
DE MEXICO, S.A., REPRESENTED BY XXXXX DE LOS ANGELES XXXXXXXXXX XXXXX AND XXXX
XXXXX XXXX XXXXXXX, IN THEIR RESPECTIVE CAPACITIES AS TRUST REPRESENTATIVE AND
SPECIAL ATTORNEY-IN-FACT OF SAID INSTITUTION, HEREINAFTER REFERRED TO, FOR THE
PURPOSES OF THIS AGREEMENT, AS THE "TRUSTEE," PARTY OF THE SECOND PART, WHO
AGREE TO FORMALIZE THE FOLLOWING RECITALS AND CONDITIONS WITH THE FOLLOWING
WORDING.
----RECITALS----
THE PARTIES JOINTLY DECLARE:
(A) That they mutually recognize the legal standing and capacity with which
they agree to enter into this Agreement, being authorized to bind their
principals under the terms and conditions stipulated therein.
(B) That on August 10, 1995, a Trust Agreement was entered into between CEMEX,
S.A. DE C.V. as Trustor/Beneficiary and Banco Nacional de Mexico, S.A. as
Trustee; said Contract was recorded under No. 110910-1, and contained the
Option Plan for employees and officers of the Trustor/Beneficiary.
(C) That on June 19, 1996, a Modifying Agreement to said Trust Agreement was
entered into, amending Articles Five and Twelve of said agreement.
(D) That on June 6, 2001, they entered into a Modifying and Adhesion Agreement
to the aforementioned Trust Agreement, in order for CENTRO DISTRIBUIDOR DE
CEMENTO, S.A. DE C.V. as a company controlled by CEMEX, S.A. DE C.V., to
join as a Joined Trustor/Beneficiary.
(E) That the Trust Agreement and its aforementioned Modifying Agreements shall
be jointly called hereinafter, and for the purposes of this Agreement only,
the "TRUST."
(F) That they ratify the rights and obligations stipulated in the TRUST.
(G) That they wish to enter into this Agreement pursuant to the following:
[LOGO] Banamex
----TERMS AND CONDITIONS----
ONE: PURPOSE OF THE AGREEMENT.
The purpose of this Agreement is to expressly state for the record the
modifications and additions to the rights and obligations of all the parties
involved in any capacity in the TRUST, all of them further undertaking to abide
by the terms and conditions arising from the execution of this instrument.
TWO: DEFINITION OF THE TERM "SHARES."
The TRUSTORS and the TRUSTEE agree to modify the definition of the term SHARES
in the Definitions Section of the `TRUST' Agreement to read as follows:
"DEFINITIONS. (... ... ...)
c) `SHARES' Treasury Shares, Subscribed Unpaid,
or Paid-Up, representing the Share Capital
of Cemex, S.A. de C.V. or Ordinary
Investment Certificates (CPOs) issued by a
trust institution based on shares
representing the Share Capital of Cemex,
S.A. de C.V..."
THREE: OPTION RIGHTS.
The TRUSTORS and the TRUSTEE agree to modify Article Five of the TRUST Agreement
to read as follows:
"FIVE. OPTION RIGHTS.
The Technical Committee shall be the body authorized to determine who
shall be the `ELIGIBLE PERSONS,' in addition to the members of the
Board of Directors and Commissioners, Owners, and Alternates, of Cemex,
S.A. de C.V., who shall be considered `ELIGIBLE' for the purposes of
this agreement. The Trustee, by authorization of the Technical
Committee, shall grant and formalize with the ELIGIBLE PERSONS the
granting of the OPTION RIGHTS, in accordance with the following
criteria:
a) The OPTION RIGHTS shall be granted at the time determined by the
Technical Committee.
b) Each OPTION RIGHT shall specify the number of SHARES that the
ELIGIBLE PERSON may subscribe or purchase; said number shall be
determined by the Technical Committee as instructed by the Board
of Directors of Cemex, S.A. de C.V. and taking into account the
capacity of the ELIGIBLE PERSONS to perform the work.
c) The OPTION RIGHTS assigned may be exercised within a maximum of up
to fifteen (15) years (Exercise Period), which period shall run
from the date the granting of the `OPTION RIGHTS' is formalized.
After 1 (one) year has elapsed from the granting of the OPTION RIGHTS,
the OPTION RIGHTS may be exercised and, consequently, the SHARES may be
subscribed or purchased, as instructed by the Technical Committee
defining the parameters, terms, and conditions in accordance with the
following modalities: (i) up to 25% (twenty-five percent) of all the
Shares that include OPTION RIGHTS each year during the first working
day of the same month on which they were granted, which shall be
considered the paid-up portion; or (ii) 100% (one hundred percent) of
the SHARES in the 4th (fourth) year during the first working day of the
same month on which they were granted.
Any Shares not purchased on the predetermined dates may be purchased
each month, once the 30 (thirty) days have passed from the
predetermined date, on the corresponding working day and until the
Exercise
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Period has ended.
For the purpose of the sale of the Purchased Shares, the Trustee may
take sales orders only within the 15 (fifteen) days immediately
following the purchase or, if applicable on the 15th (fifteenth) of
each month or on the working day immediately following if the 15th was
not a working day.
The Technical Committee may instruct the Trustee on the necessary
adjustments in the exercise price and number of SHARES to be subscribed
or purchase under the OPTION RIGHTS granted within each Plan.
The Technical Committee shall be authorized to order the temporary
suspension of the OPTION RIGHTS in cases where this is necessary in
order to facilitate the enforcement and/or performance of the
resolutions adopted by the Shareholders' Meeting, the Board of
Directors, or any other intermediary administrative body of Cemex, S.A.
de C.V.
When the OPTION RIGHTS are exercised by the ELIGIBLE PERSONS, the
Technical Committee must notify the Trustee of the use of any of the
following rules, if applicable:
1. If an employee is fired with cause, the option rights may be
exercised on the last working day of the month following the one
in which he or she was given notice and only for the paid-up
portions of the option rights; the unexercised portion of option
rights shall be automatically revoked.
2. If an employee resigns voluntarily, the option rights may be
exercised within 3 (three) years from the time he leaves the
company and only for the paid-up portions of the option rights;
the unexercised portion of option rights shall be automatically
revoked.
3. In the event of death, permanent disability, or retirement, the
option rights may be exercised on the predetermined dates,
starting from the date each Plan is granted for 100% of the
options granted, paid-up or not
4. If an employee is fired without cause or resigns for reasons
attributable to CEMEX, the option rights may be exercised within 4
(four) years of the firing or resignation, on the exercise dates
and in the percentages granted in each Plan, for 100% of the
options granted, paid-up or not. [handwritten comment] [illegible]
vesting of the last plan -> [illegible] with 10 years.
If the bearer of the `OPTION RIGHTS' acts fraudulently or in bad faith
against, or carries out acts that damage or injure Cemex S.A. de C.V.
or any of its subsidiaries or affiliates, direct or indirect, all of
the OPTION RIGHTS granted to the perpetrator shall be automatically
revoked, without the need for a court order, from the last working day
of the month following the one in which the Technical Committee
notified the Trustee about the enforcement of the contractual penalty
in that matter.
The bearers of the OPTION RIGHTS shall be obligated to Cemex, S.A. de
C.V. or any of its subsidiaries or affiliates, direct or indirect,
while its `OPTION RIGHTS' are in effect, not to provide its services in
any way (by itself or through a third party), nor to form a partnership
or company with third parties (by itself or through an intermediary),
who are involved directly or through other persons, entities, or trusts
in the production or marketing of cement or cement byproducts; if the
bearer of the `OPTION RIGHTS' wishes to provide its services to, or
form a partnership or a company with persons or entities involved in
any way (directly or indirectly through other persons under their
control or associated with them) in the production or marketing of
cement and cement byproducts, it shall notify the Technical Committee
in writing. The Technical Committee may then release it from its
obligation under this clause, with the understanding that at the end of
this provision of services, company, or partnership, the bearer of the
OPTION RIGHTS shall remain subject to its obligation under this article
until the end of the period stipulated herein. The breach of
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this obligation by the bearer of the OPTION RIGHTS shall [make] all of
the OPTION RIGHTS that have been granted to be automatically revoked
without the need for a court order, starting from the last working day
of the month following the one in which the Technical Committee
notified the Trustee of the application of this contractual penalty in
this matter.
FOUR: EFFECTIVE DATE AND CONTINUITY
The parties undertake to abide by all the terms provided for in the TRUST and in
this Agreement, and all of the obligations and rights of all the remaining
parties involved shall remain in effect; therefore, there is no novation of the
same. This Agreement shall take full effect between the parties as of the date
of execution hereof.
AFTER THIS AGREEMENT WAS READ BY THE PARTIES AND THEY WERE DULY INFORMED OF ITS
CONTENT AND LEGAL SCOPE, THEY EXECUTED IT IN COMPLETE AGREEMENT IN SAN XXXXX
XXXXX XXXXXX, NUEVO XXXX, ON JUNE 15, 2001.
TRUSTORS
[signature] [signature]
Cemex, S.A. de C.V. Centro Distribuidor de Cemento, SA de CV
represented by represented by
Xxxxxxx X. Xxxxxx Xxxxxxx Xxxxxxx X. Xxxxxx Xxxxxxx
FIDUCIARY
BANCO NACIONAL DE MEXICO, S.A.
FIDUCIARY DIVISION
Xxxxx de los Angeles Xxxxxxxxxx Xxxxx, Esq. Xxxx Xxxxx Xxxx Xxxxxxx, Esq.
TECHNICAL COMMITTEE
[signature]
Xxxxxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxx Xxxxxxx
_____________________________
Xxxxxx Xxxxxx Xxxxxx
