Cemex 2012 Annual Report Download - page 104

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Notes to the
consolidated
financial
statements
104
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As of December 31, 2012 and 2011, the detail of CEMEX’s perpetual debentures, giving effect to the exchange transactions
that occurred during these periods, as mentioned above, and to the exclusion of perpetual debentures held by subsidiaries, was
as follows:
2012 2011
Issuer Issuance date Nominal amount Nominal amount Repurchase option Interest rate
C10-EUR Capital (SPV) Ltd. May 2007 €64 €147 Tenth anniversary 6.3%
C8 Capital (SPV) Ltd. February 2007 US$137 US$288 Eighth anniversary 6.6%
C5 Capital (SPV) Ltd. 1 December 2006 US$69 US$111 Fifth anniversary LIBOR + 4.277%
C10 Capital (SPV) Ltd. December 2006 US$183 US$349 Tenth anniversary 6.7%
1 Beginning January 1, 2012, the annual interest rate of this series changed from 6.2% to 3-month LIBOR plus 4.277%, which is reset quarterly.
Interest payments on this series will be made quarterly instead of semi-annually. CEMEX is not permitted to call these debentures under the
Facilities Agreement. As of December 31, 2012 and 2011, 3-month LIBOR was approximately 0.306% and 0.5810%, respectively.
21) Executive stock-based compensation
CEMEX has long-term restricted stock-based compensation programs providing for the grant of CEMEX’s CPOs to a group of
executives, pursuant to which, new CPOs are issued under each annual program over a service period of 4 years. By agreement
with the executives, the CPOs of the annual grant (25% of each annual program) are placed in a trust established for the benefit of
the executives to comply with a 1 year restriction on sale. Under these programs, CEMEX granted approximately 46.4 million CPOs
in 2012, 43.4 million CPOs in 2011 and 25.7 million CPOs in 2010 that were subscribed and pending for payment in CEMEX’s
treasury. Of the total CPOs granted in 2011, approximately 10.3 million CPOs were related to termination payments associated
with restructuring events (note 6). As of December 31, 2012, there are approximately 87.4 million CPOs associated with these
annual programs that are expected to be issued during the following years as the executives render services. The compensation
expense related to these programs in 2012, 2011 and 2010 recognized in the operating results amounted to approximately
$486, $415 and $536, respectively. The weighted average price per CPO granted during the period was approximately $10.48
in 2012, $11.42 in 2011 and $12.12 in 2010.
In 2012, CEMEX initiated a new stock-based compensation program for a group of executives which is linked to both internal
performance conditions (increase in Operating EBITDA), as well as market conditions (increase in the price of CEMEX’s CPO), over
a period of three years. Under this program, CEMEX granted awards over approximately 39.9 million CPOs, which become vested
upon achievement of the annual performance conditions. Any CPOs vested would be delivered, fully unrestricted, only to active
executives in March 2015. The compensation expense related to this program in 2012 of approximately $136 was recognized in
the operating results against “Other equity reserves.”