UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2002
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from _____________ to _____________
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
CHICAGO BRIDGE & IRON SAVINGS PLAN
c/o Chicago Bridge & Iron Company
1501 North Division Street
Plainfield, Illinois 60544
B. Name and issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Chicago Bridge & Iron Company, N.V.
Polarisavenue 31
2132 JH Hoofdorp
The Netherlands
CHICAGO BRIDGE & IRON SAVINGS PLAN
TABLE OF CONTENTS
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PAGE
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits as of
December 31, 2002 and 2001 2
Statement of Changes in Net Assets Available for Benefits for the
Year Ended December 31, 2002 3
Notes to Financial Statements 4-8
SUPPLEMENTAL SCHEDULES:
Form 5500, Schedule H, Part IV, Line 4i--
Schedule of Assets (Held at End of Year), as of December 31, 2002 9
Form 5500, Schedule H, Part IV, Line 4d--
Schedule of Nonexempt Transactions for the Year Ended December 31, 2002 10
(Supplemental schedules not listed are omitted due to the absence of conditions
under which they are required.)
INDEPENDENT AUDITOR'S REPORT
To the Plan Administrator of the
Chicago Bridge & Iron Savings Plan:
We have audited the accompanying statements of net assets available for benefits
of the Chicago Bridge & Iron Savings Plan (the "Plan") as of December 31, 2002,
and the related statement of changes in net assets available for benefits for
the year then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audit. The statement of net assets available
for benefits of the Plan as of December 31, 2001 was audited by other auditors
who have ceased operations. Those auditors expressed an unqualified opinion on
that statement in their report, dated May 30, 2002.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2002, and the changes in net assets available for benefits for the year then
ended in conformity with accounting principles generally accepted in the United
States of America.
Our audit was conducted for the purpose of forming an opinion on the basic 2002
financial statements taken as a whole. The supplemental schedules of assets
(Held at Year End) as of December 31, 2002 and Nonexempt Transactions for the
year ended December 31, 2002 are presented for the purpose of additional
analysis and are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These schedules are the responsibility of the Plan's
management. Such schedules have been subjected to the auditing procedures
applied in our audit of the basic 2002 financial statements and, in our opinion,
are fairly stated in all material respects when considered in relation to the
basic financial statements taken as a whole.
DELOITTE & TOUCHE LLP
Chicago, Illinois
May 9, 2003
CHICAGO BRIDGE & IRON SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2002 AND 2001
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ASSETS 2002 2001
PARTICIPANT DIRECTED INVESTMENTS (NOTE 3) $208,644,557 $222,478,507
EMPLOYER CONTRIBUTION RECEIVABLE 9,043,241 5,814,346
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $217,687,798 $228,292,853
============ ============
See notes to financial statements.
-2-
CHICAGO BRIDGE & IRON SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 2002
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ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Interest $ 364,912
Dividends 4,279,281
Plan transfers in (Note 1) 4,838,613
Contributions:
Participant 11,396,054
Rollovers 5,958,303
Employer 13,513,555
-------------
Total additions 40,350,718
-------------
DEDUCTIONS TO NET ASSETS ATTRIBUTED TO:
Net depreciation in fair value of investments (Note 3) 32,053,266
Benefits paid to participants 18,889,927
Administrative expenses (Note 4) 12,580
-------------
Total deductions 50,955,773
-------------
NET DECREASE (10,605,055)
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 228,292,853
-------------
End of year $ 217,687,798
=============
See notes to financial statements.
-3-
CHICAGO BRIDGE & IRON SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 2002 AND 2001
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1. DESCRIPTION OF THE PLAN AND INVESTMENT PROGRAM
The following describes the major provisions of the Chicago Bridge & Iron
Savings Plan (the "Plan") and provides only general information.
Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
GENERAL--The Plan is a defined contribution plan in which designated
employees of Chicago Bridge & Iron Company and certain of its wholly owned
subsidiaries (the "Company") are eligible to participate. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of
1974 ("ERISA").
T. Rowe Price Trust Company (the "Trustee") serves as trustee. The
record keeper for the Plan, under a contract with the Company, is T. Rowe
Price Retirement Plan Services, Inc. ("RPS").
MERGERS INTO PLAN--Effective January 1, 2002, the Morse Construction Group
division of the Rock-Mo 401(k) Plan merged into this plan. Participant
account balances of $629,122 were transferred to the Plan during 2002.
Effective October 3, 2002, the CB&I Shop Employees 401(k) Plan merged into
this Plan. Participant account balances of $4,209,491 were transferred to
the Plan during 2002.
Effective December 31, 2000, the Howe-Baker Engineers, Inc. Employees'
Profit-Sharing 401(k) Plan, Matrix Engineering, Inc. Savings Plan, A&B
Buildings, Inc. Savings Plan and Callidus Technologies 401(k) Savings
Plan ("Merged Plans"), merged into this Plan.
PARTICIPANT AND COMPANY CONTRIBUTIONS--The Plan is a combination
profit-sharing and 401(k) voluntary salary deferral plan. Except as noted
below, the Company automatically contributes 5% of annual pay (including
overtime and incentive compensation) and may contribute up to 12% depending
on Company performance and IRS limits on compensation. The Company
contribution is applicable for each eligible participant following the end
of the Plan year for which the contribution is made. Participants may
contribute amounts on a pretax deferred basis from a minimum of 1% to a
maximum of 75% of compensation subject to the dollar limits set by the IRS,
or lower percentage limits set by the Company in advance of a given Plan
year. Participants may elect to change their contribution percentages at any
time in advance of the next payroll period.
The Company contributes a dollar-for-dollar match of the participants'
annual 401(k) contributions, up to the first 3% of the compensation that the
participant elects to contribute.
For purposes of contributions, the following applies for participants
covered by the merged plans:
- For participants who formerly participated in the Howe-Baker
Engineers, Inc. Employees' Profit-Sharing 401(k) Plan, the Company
contributes 1% of compensation. Additionally the Company makes
matching contributions of 50% of the first 4% of compensation, and
may make additional discretionary contributions. A discretionary
contribution of $1,418,966 was made for the Plan year ended December
31, 2002.
-4-
- For participants who formerly participated in the Matrix Engineering,
Inc. Savings Plan or the A&B Builders, Inc. Savings Plan, the Company
makes matching contributions of 50% of the first 6% of compensation, and
may make discretionary contributions as determined each year. There were
no discretionary contributions during the year.
- For participants who formerly participated in the Callidus Technologies
401(k) Savings Plan, the Company automatically contributes 3% of annual
pay (including overtime and incentive compensation) and may contribute
up to 6% depending on Company performance and IRS limits on
compensation; makes matching contributions of 100% of the first 3% of
compensation; and may make discretionary Company contributions as
determined each year. A discretionary contribution of $316,805 was made
for the Plan year ended December 31, 2002.
- For participants who formerly participated in the CB&I Shop Employees
401(k) Plan, which merged with the Plan during 2002, the Company makes
matching contributions of 100% up to $0.60 per hour for total hours
worked for Clive and Warren employees and $0.70 per hour up to October
31, 2002 and $0.75 per hour beginning November 1, 2002 for total hours
worked for Provo employees.
- For participants employed by Morse Construction Group who formerly
participated in the Rock-Mo 401(k) Plan, the Company makes matching
contributions of 100% of the first 3% of compensation; and may make
discretionary Company contributions as determined each year. No
discretionary contribution was made for the Plan year ended December 31,
2002.
PARTICIPANT ACCOUNTS--Individual accounts are maintained for each Plan
participant. Each participant's account is credited with the participant's
contribution, Company contributions, and allocation of investment earnings
or losses. Allocations are based on account balances. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account.
INVESTMENT OPTIONS--Participants direct the investment of their account
balances into any or all of a number of investment options which include
mutual funds investing in equities (including the TradeLink investment
account investing in mutual funds beyond the Trustee's family of funds) a
company stock fund (which invests in the common stock of Chicago Bridge &
Iron Company, N.V.), an income fund investing in bonds, stable value fund,
and a money market fund.
The Plan's investments in the common stock of Placer Dome, Inc. and
Mississippi Chemical Corp. result from prior plan mergers and no future
investment is permitted in those investments.
VESTING--Company matching contributions vest 100% after three years and the
Company's annual contributions vest 100% after five years of service with
the Company. Participants who terminate their participation in the Plan due
to retirement, disability, death or work force reduction are granted full
vesting in Company contributions.
For participants formerly included in the CB&I Shop Employee 401(k) Plan,
Company matching contributions prior to 2002 vest over a five-year
cliff-vesting schedule. Company contributions in 2002 vest over a three-year
cliff-vesting schedule.
PARTICIPANT LOANS--Participants may borrow up to 50% of their vested account
balances, up to $50,000, with a minimum loan amount of $1,000. No more than
one loan may be outstanding from a participant's account at any time. Loans
are secured by the balance in the participant's account, bear interest at
the prime rate plus 1% and are repayable over a period not to exceed five
years, except for principal residence loans, which are repayable over a
period not to exceed fifteen years. Any amount
-5-
borrowed is deducted pro rata from the funds in which the participant
account is invested. Repayments of principal and interest are credited to
the funds in which the participant's deferrals are invested.
PAYMENT OF BENEFITS--Upon termination of employment, participants may
receive a lump-sum payment of their account balances, subject to the vesting
provisions described above. Other payment forms are available to certain
participants for accounts existing prior to January 1, 1997.
FORFEITURES--Forfeited accounts, representing the unvested portion of the
Company's contributions, were approximately $420,000 and $179,000 as of
December 31, 2002 and 2001, respectively. These balances will be used to
reduce future Company contributions.
2. SUMMARY OF ACCOUNTING POLICIES
BASIS OF ACCOUNTING--The accompanying financial statements of the Plan were
prepared on the accrual basis of accounting in accordance with accounting
principles generally accepted in the United States of America ("GAAP").
USE OF ESTIMATES--The preparation of financial statements in conformity with
GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and changes therein, and
disclosure of contingent assets and liabilities. Actual results could differ
from those estimates. The Plan utilizes various investment instruments.
Investment securities, in general, are exposed to various risks, such as
interest rate, credit, and overall market volatility. Due to the level of
risk associated with certain investment securities, it is reasonably
possible that changes in the values of investment securities will occur in
the near term and that such changes could materially affect the amounts
reported in the financial statements.
INVESTMENT VALUATION AND INCOME RECOGNITION--Investments are stated at fair
value, except for investments in the Stable Value Fund, which is stated at
contract value (which includes accrued interest). Mutual funds are valued at
quoted market prices, which represent the net asset value of shares held by
the Plan at year-end. Participant loans are stated at cost plus accrued
interest.
The T. Rowe Price Stable Value Fund is a common and collective trust
("CCT"). The Plan owns shares in this CCT, which, in turn, holds shares in
the underlying securities, which includes guaranteed investment contracts.
The fund provides for benefit-responsive withdrawals at contract value. The
average yield for the CCT was approximately 5.63% for the year ended
December 31, 2002. The crediting interest rate for the CCT was approximately
4.85% and 5.44% at December 31, 2002 and 2001, respectively.
Purchases and sales of securities are recorded on a trade date basis.
Interest income is recorded on an accrual basis. Dividend income is recorded
on the ex-dividend date.
NET DEPRECIATION IN FAIR VALUE OF INVESTMENTS--Net realized and unrealized
depreciation is recorded in the accompanying statement of changes in net
assets available for benefits as net depreciation in fair value of
investments.
ADMINISTRATIVE EXPENSES--Trustee fees are paid by the Plan. Investment
management fees, agent fees and brokerage commissions are paid by the Plan
and are included as a reduction of the return earned on each fund. Other
outside professional, administrative services are paid or provided by the
Company.
-6-
PAYMENT OF BENEFITS--Benefit payments to participants are recorded upon
distribution. There were no amounts allocated to accounts of persons who
have elected to withdraw from the plan but have not yet been paid at
December 31, 2002 and 2001.
3. INVESTMENTS
The following presents investments that represent 5% or more of the Plan's
net assets at December 31, 2002 and 2001:
2002 2001
T. Rowe Price Balanced Fund $31,902,989 $37,540,450
T. Rowe Price Blue Chip Growth Fund 30,718,954 39,927,376
T. Rowe Price Equity Income Fund 26,613,969 32,220,185
T. Rowe Price Equity Index 500 Fund 21,784,737
T. Rowe Price Equity Index Trust 17,134,072
T. Rowe Price Prime Reserve Fund 24,867,360
T. Rowe Price Summit Cash Reserves Fund 29,210,480
T. Rowe Price Stable Value Fund 21,240,522 14,844,674
T. Rowe Price New Horizons Fund 11,374,919 15,158,195
During 2002, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) depreciated in
value by $32,053,266 as follows:
Mutual funds:
T.Rowe Price Janus Fund $ (1,041,815)
T.Rowe Price Trade Link Investments Account 111,827
T.Rowe Price International Stock Fund (1,409,403)
T.Rowe Price New Horizons Fund (4,166,241)
T.Rowe Price Small Cap Value fund (622,625)
T.Rowe Price Equity Index Trust (5,165,274)
T.Rowe Price Balanced Fund (4,243,282)
T.Rowe Price Equity Income Fund (5,274,013)
T.Rowe Price Spectrum Income Fund 178,697
T.Rowe Price Spectrum Growth Fund (1,168,444)
T.Rowe Price Blue Chip Growth Fund (9,827,527)
------------
(32,628,100)
Common stock 574,834
------------
Total $(32,053,266)
============
-7-
4. RELATED-PARTY TRANSACTIONS
All of the investment fund options are managed by T. Rowe Price
Associates, Inc. ("Associates") an affiliate of the Trustee, except for
the Stable Value Fund, Equity Index Trust Fund, and the International
Stock Fund. The Stable Value Fund ("CCT") and the Equity Index Trust
Fund are managed by the Trustee. The International Stock Fund is managed
by Rowe Price-Fleming International, Inc., a joint venture between
Associates and Robert Fleming Holdings Ltd. of London.
At December 31, 2002 and 2001, the Plan held 127,900.120 and 122,923.860
units (or shares), of Chicago Bridge & Iron Company, N.V. ("CB&I N.V."),
the Plan's sponsor, with a cost basis of $3,862,584 and $1,545,496,
respectively. During the year ended December 31, 2002, the Plan recorded
dividend income from the CB&I N.V. stock of $29,902.
5. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate
the Plan subject to the provisions of ERISA. In the event of Plan
termination, participants will become 100% vested in their accounts
regardless of the period of service.
6. TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter, dated May 21, 2002, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (the
"Code"). The plan administrator and the Plan's tax counsel believe that the
Plan is currently designed and being operated in compliance with the
applicable requirements of the Code. Accordingly, no provision for income
taxes has been included in the Plan's financial statements.
7. NONEXEMPT PARTY-IN-INTEREST TRANSACTIONS
During the plan year ended December 31, 2002, there was a deemed loan made
to the Company when the employees' 401(k) contributions were not remitted to
the Plan on a timely basis. The Company subsequently remitted the
contributions to the Plan and repaid the Plan for the interest incurred on
the loan. The interest was calculated using the highest rate earned by the
plan assets during 2002 until the contribution was remitted to the Plan.
******
-8-
SCHEDULE I
CHICAGO BRIDGE & IRON SAVINGS PLAN
FORM 5500, SCHEDULE H, LINE 4I--
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2002
(EMPLOYER IDENTIFICATION NUMBER 06-1477022, PLAN NUMBER 001)
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IDENTITY OF ISSUER, BORROWER, CURRENT
LESSOR OR SIMILAR PARTY DESCRIPTION OF INVESTMENT VALUE
Mutual funds:
* T. Rowe Price Spectrum Income Fund $ 10,838,463
* T. Rowe Price Balanced Fund 31,902,989
* T. Rowe Price Blue Chip Growth Fund 30,718,954
* T. Rowe Price Equity Income Fund 26,613,969
* T. Rowe Price Equity Index Trust 17,134,072
* T. Rowe Price Summit Cash Reserves Fund 29,210,480
* T. Rowe Price International Stock Fund 5,877,019
* T. Rowe Price Spectrum Growth Fund 4,328,657
* T. Rowe Price New Horizons Fund 11,374,919
* T. Rowe Price Janus Fund 2,925,304
* T. Rowe Price Small Cap Value Fund 7,516,654
* T. Rowe Price Stable Value Fund 21,240,522
* T. Rowe Price Trade Link Investments Account 152,726
Placer Dome Inc. Common stock 77,145
Mississippi Chemical Corp. Common stock 521
* Chicago Bridge & Iron Company N. V. Common stock 3,862,584
* Participant loans Interest rates--5.75% to 10.5%,
maturing 2003 to 2018 4,869,579
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TOTAL $ 208,644,557
=============
* Represents a party-in-interest to the Plan.
-9-
SCHEDULE II
CHICAGO BRIDGE & IRON SAVINGS PLAN
FORM 5500, SCHEDULE H, PART IV, LINE 4D--
SCHEDULE OF NONEXEMPT TRANSACTIONS
YEAR ENDED DECEMBER 31, 2002
(EMPLOYER IDENTIFICATION NUMBER 06-1477022, PLAN NUMBER 001)
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RELATIONSHIP
OF PLAN,
EMPLOYER DESCRIPTION OF TRANSACTION
OR OTHER INCLUDING MATURITY DATE, (i) INTEREST
PARTY IN RATE OF INTEREST, COLLATERAL, (d) AMOUNT INCURRED
IDENTITY OF PARTY INVOLVED (a) INTEREST (b) PAR OR MATURITY VALUE (c) LOANED ON LOAN
Chicago Bridge & Iron Company Plan sponsor Lending of monies from the Plan to the Plan sponsor
(contributions not remitted to the Plan on time) and
interest on the loan as follows:
Deemed loan occurred July 21, 2001, matured August 14,
2001 for $22,768, with interest at various rates $ 22,768 $ 578
======== =====
Deemed loan occurred September 22, 2001, matured
September 28, 2001 for $23,198, with interest at
various rates $ 23,198 $ 160
======== =====
Deemed loan occurred September 22, 2001, matured
September 28, 2001 for $23,792, with interest at
various rates $ 23,792 $ 164
======== =====
-10-
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the plan
administrator has duly caused this annual report to be signed on its behalf by
the undersigned thereunto duly authorized.
Dated: June 24, 2003
CHICAGO BRIDGE & IRON SAVINGS PLAN
By: /s/ David P. Bordages
-------------------------------
David P. Bordages
Vice-President, Human Resources
and Administration
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
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23 Independent Auditor's Consent
99 Section 906 Certification