<PAGE>

                                                                    EXHIBIT 10.9

                                                                  EXECUTION COPY

================================================================================
                                 CREDIT AGREEMENT

                          Dated as of September 17, 2002

                                      among

                                TFM, S.A. DE C.V.,

                                   as Borrower

                           J.P. MORGAN SECURITIES INC.,

                  as Joint Lead Arranger and Sole Book Manager

                            SALOMON SMITH BARNEY INC.,

                              as Joint Lead Arranger

                              BANK OF AMERICA, N.A.,
                                  COMERICA BANK
                                      and
                LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE, KIEL

                                 as Arrangers

                            STANDARD CHARTERED BANK

                      as Arranger and Documentation Agent

                              JPMORGAN CHASE BANK,

                            as Administrative Agent

                                      and

                            THE BANKS NAMED HEREIN,

                                    as Banks

================================================================================

                                 US$128,000,000

================================================================================

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                Page
                                                                                ----
<S>                                                                             <C>
ARTICLE I DEFINITIONS ........................................................    1

    SECTION 1.1. Certain Definitions..........................................    1
    SECTION 1.2. Other Definitional Provisions ...............................   20

ARTICLE II AMOUNTS AND TERMS OF COMMITMENTS ..................................   20

    SECTION 2.1. Commitments; Notes...........................................   20
    SECTION 2.2. Procedure for Borrowing......................................   21
    SECTION 2.3. Repayment ...................................................   21
    SECTION 2.4. Prepayments..................................................   21
    SECTION 2.5. Interest Rates and Payment Dates.............................   22
    SECTION 2.6. Computation of Interest......................................   23
    SECTION 2.7. Inability to Determine Interest Rate.........................   23
    SECTION 2.8. Maximum Interest Rate........................................   23
    SECTION 2.9. Fees ........................................................   24
    SECTION 2.10. Pro Rata Treatment and Payments.............................   24
    SECTION 2.11. Taxes ......................................................   25
    SECTION 2.12. Illegality..................................................   26
    SECTION 2.13. Requirements of Law ........................................   26
    SECTION 2.14. Funding Indemnity ..........................................   28
    SECTION 2.15. Sharing of Payments, Etc ...................................   28
    SECTION 2.16. Change of Lending Office. ..................................   28
    SECTION 2.17. Replacement of Banks........................................   29

ARTICLE III CONDITIONS PRECEDENT .............................................   29

    SECTION 3.1. Conditions to Effective Date ................................   29
    SECTION 3.2. Conditions to Term Loan .....................................   31

ARTICLE IV REPRESENTATIONS AND WARRANTIES ....................................   32

    SECTION 4.1. Status and Licensing ........................................   32
    SECTION 4.2. Corporate Power and Authority; Enforceable Obligations ......   32
    SECTION 4.3. Compliance with Law and Other Instruments....................   32
    SECTION 4.4. Litigation and Environmental Matters ........................   33
    SECTION 4.5. Governmental Approvals ......................................   33
    SECTION 4.6. Financial Information........................................   33
    SECTION 4.7. Taxes, Assessments and Fees .................................   34
    SECTION 4.8. Investment Company Act ......................................   34
    SECTION 4.9. Accuracy of Information .....................................   34
    SECTION 4.10. Absence of Default..........................................   34
    SECTION 4.11. Obligations Pari Passu; Recourse; Liens.....................   34
    SECTION 4.12. Withholding Tax ............................................   34
    SECTION 4.13. Proper Form; No Filing .....................................   34
</TABLE>

                                      i

<PAGE>

<TABLE>
<CAPTION>
                                                                                Page
                                                                                ----
<S>                                                                             <C>
    SECTION 4.14. Choice of Law...............................................   35
    SECTION 4.15. Immunity ...................................................   35
    SECTION 4.16. Status of Concession .......................................   35
    SECTION 4.17. Properties .................................................   35
    SECTION 4.18. Subsidiaries................................................   35
    SECTION 4.19. Federal Regulations.........................................   36
    SECTION 4.20. Labor Matters...............................................   36

ARTICLE V AFFIRMATIVE COVENANTS...............................................   36

    SECTION 5.1. Senior Obligations...........................................   36
    SECTION 5.2. Financial Statements ........................................   36
    SECTION 5.3. Notice of Default; Litigation and Material Adverse Effect....   37
    SECTION 5.4. Use of Proceeds .............................................   37
    SECTION 5.5. Conduct of Business and Maintenance of Existence ............   37
    SECTION 5.6. Maintenance of Government Approvals .........................   38
    SECTION 5.7. Compliance with Laws and Other Instruments ..................   38
    SECTION 5.8. Maintenance of Properties; Insurance ........................   38
    SECTION 5.9. Maintenance of Books and Records and Inspection Rights ......   38
    SECTION 5.10. Payment of Obligations .....................................   38
    SECTION 5.11. Environmental Laws .........................................   39

ARTICLE VI NEGATIVE COVENANTS.................................................   39

    SECTION 6.1. Financial Covenants .........................................   39
    SECTION 6.2. Margin Regulations...........................................   40
    SECTION 6.3. Limitation on Restricted Payments ...........................   40
    SECTION 6.4. Limitation on Dividend and Other Payment Restrictions
                   Affecting Subsidiaries. ...................................   44
    SECTION 6.5. Limitation on the Issuance and Sale of Capital Stock of
                   Subsidiaries...............................................   45
    SECTION 6.6. Limitation on Issuances of Guarantees by Subsidiaries. ......   45
    SECTION 6.7. Limitation on Transactions with Stockholders and Affiliates..   46
    SECTION 6.8. Limitation on Liens .........................................   47
    SECTION 6.9. Limitation on Sale-Leaseback Transactions....................   47
    SECTION 6.10. Limitation on Asset Sales ..................................   48
    SECTION 6.11. Consolidation, Merger and Sale of Assets....................   48
    SECTION 6.12. Lines of Business ..........................................   50
    SECTION 6.13. Additional Indebtedness ....................................   50

ARTICLE VII EVENTS OF DEFAULT ................................................   50

    SECTION 7.1. Events of Default ...........................................   50
    SECTION 7.2. Remedies ....................................................   52

ARTICLE VIII THE ADMINISTRATIVE AGENT.........................................   53

    SECTION 8.1. Appointment .................................................   53
    SECTION 8.2. Delegation of Duties ........................................   53
</TABLE>

                                      -ii-

<PAGE>

<TABLE>
<CAPTION>
                                                                                Page
                                                                                ----
<S>                                                                             <C>
    SECTION 8.3. Exculpatory Provisions ......................................   53
    SECTION 8.4. Reliance by the Administrative Agent ........................   53
    SECTION 8.5. Notice of Default............................................   54
    SECTION 8.6. Non-Reliance on the Administrative Agent and Other Banks.....   54
    SECTION 8.7. Indemnification .............................................   55
    SECTION 8.8. The Administrative Agent in Its Individual Capacity..........   55
    SECTION 8.9. Successor Administrative Agent...............................   55

ARTICLE IX THE JOINT LEAD ARRANGERS, ARRANGERS, DOCUMENTATION
    AGENT ....................................................................   56

    SECTION 9.1. The Joint Lead Arrangers, etc................................   56
    SECTION 9.2. Exculpatory Provisions ......................................   56
    SECTION 9.3. Arrangers and Agent .........................................   56
    SECTION 9.4. Non-Reliance on the Arrangers, Agent and Other Banks ........   56

ARTICLE X MISCELLANEOUS.......................................................   57

    SECTION 10.1. Transfers of Funds .........................................   57
    SECTION 10.2. Financial Data .............................................   57
    SECTION 10.3. Payment of Expenses, etc ...................................   57
    SECTION 10.4. Amendments and Waivers......................................   58
    SECTION 10.5. GOVERNING LAW...............................................   59
    SECTION 10.6. Indemnification ............................................   59
    SECTION 10.7. Notices.....................................................   59
    SECTION 10.8. Table of Contents; Descriptive Headings; etc ...............   62
    SECTION 10.9. Survival of Agreements and Representations..................   62
    SECTION 10.10. Benefit of Agreement; Assignment...........................   62
    SECTION 10.11. Participation .............................................   62
    SECTION 10.12. Right of Set-off ..........................................   63
    SECTION 10.13. SUBMISSION TO JURISDICTION; VENUE; SERVICE;
                   WAIVER OF JURY TRIAL ......................................   63
    SECTION 10.14. Judgment Currency .........................................   65
    SECTION 10.15. Execution in Counterparts .................................   65
    SECTION 10.16. Waiver of Immunities.......................................   65
    SECTION 10.17. Severability ..............................................   65
    SECTION 10.18. Confidentiality ...........................................   65
    SECTION 10.19. No Waiver; Remedies .......................................   66
    SECTION 10.20. Prior Agreements Superseded................................   66
</TABLE>

                                     -iii-

<PAGE>

<TABLE>
<CAPTION>
SCHEDULES
<S>                     <C>
Schedule 1.1(a)         Commitments; Percentage Shares
Schedule 1.1(b)         Lending Offices; Addresses of Notices; Payment Instructions
Schedule 4.18           Subsidiaries
Schedule 6.4(b)(i)      Existing Encumbrances or Restrictions
Schedule 6.8(a)         Existing Liens
</TABLE>

<TABLE>
<CAPTION>
EXHIBITS
<S>                     <C>
Exhibit A-1             Form of Simple Note
Exhibit A-2             Form of Mexican LIBOR Note
Exhibit B               Form of Opinion of U.S./Mexican Counsel to Borrower
Exhibit C               Form of Assignment and Acceptance
Exhibit D               Form of Notice of Borrowing
</TABLE>

<PAGE>

                                 US$128,000,000
                                    Term Loan

                         Dated as of September 17, 2002

         CREDIT AGREEMENT, dated as of September 17, 2002 among TFM, S.A. de
C.V., a limited liability company with variable capital (sociedad anonima de
capital variable) organized under the laws of the United Mexican States
("Mexico"), (the "Borrower"), the several Banks parties hereto, Bank of America,
N.A., Comerica Bank and Landesbank Schleswig-Holstein Girozentrale, Kiel, as
arrangers, Standard Chartered Bank as Arranger and Documentation Agent and
JPMorgan Chase Bank, as Administrative Agent.

                             PRELIMINARY STATEMENT:

         The Borrower has requested term loans in an aggregate principal amount
not in excess of US$128,000,000 for the purpose of refinancing existing debt
under its commercial paper program in the United States of America commercial
paper market.

         Subject to the terms and conditions set forth below, the Banks are
willing to make the aforesaid loans, and the Administrative Agent, the
Documentation Agent, the Arrangers, and the Banks are willing to enter into this
Agreement.

         NOW, THEREFORE, the Borrower, the Banks, the Documentation Agent, the
Arrangers, and the Administrative Agent hereby agree as follows:

                                   ARTICLE I

                                  DEFINITIONS

         SECTION 1.1.      Certain Definitions. As used in this Agreement, the
following terms shall have the following meanings:

         "Additional Amounts" shall have the meaning assigned to that term in
Section 2.11.

         "Adjusted Consolidated Net Income" shall mean, for any period, the
Borrower and any of its Subsidiaries' aggregate net income (or loss) for such
period determined in conformity with IAS; provided that the following items
shall be excluded in computing Adjusted Consolidated Net Income (without
duplication): (i) the net income of any Person (other than net income
attributable to a Subsidiary) in which any Person (other than the Borrower or
any of its Subsidiaries) has a joint interest, except to the extent of the
amount of dividends or other distributions actually paid to the Borrower or its
Subsidiaries by such other Person during such period; (ii) solely for the
purposes of calculating the amount of Restricted Payments that may be made
pursuant to clause (iv) (C) of Section 6.3 (and in such case, except to the
extent includible pursuant to clause (i) above), the net income (or loss) of any
Person accrued prior to the date it becomes a Subsidiary or is merged into or
consolidated with the Borrower or any of its Subsidiaries or all or
substantially all of the property and assets of such Person are acquired by the
Borrower or any of its Subsidiaries; (iii) the net income of any Subsidiary to
the extent that the declaration or payment of dividends or similar distributions
by such Subsidiary of such net

<PAGE>

income is not at the time permitted by the operation of the terms of its charter
or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Subsidiary; (iv) any gains or losses
(on an after-tax basis) attributable to Asset Sales; (v) except for purposes of
calculating the amount of Restricted Payments that may be made pursuant to
clause (iv) (C) of Section 6.3, any amount paid or accrued as dividends on any
Preferred Stock of the Borrower or any of its Subsidiaries owned by Persons
other than the Borrower and any of its Subsidiaries; and (vi) all extraordinary
gains and extraordinary losses.

         "Administration Fee Letter" shall have the meaning assigned to that
term in Section 2.9(a).

         "Administration Fees" shall have the meaning assigned to that term in
Section 2.9(a).

         "Administrative Agent" shall mean the administrative agent for the
Banks appointed pursuant to Section 8.1, initially, JPMCB, and its successors in
such capacity.

         "Affected Bank" shall have the meaning assigned to that term in Section
2.13(a)(iii)(A).

         "Affiliate" shall mean, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.

         "Agreement" shall mean this Credit Agreement, as from time to time
amended, supplemented or otherwise modified.

         "Applicable Margin" shall be determined in accordance with the table
set forth below:

<TABLE>
<CAPTION>
-------------------------------------------
  Consolidated
 Leverage Ratio          Applicable Margin
-------------------------------------------
<S>                      <C>
- 4.0x                        2.625%
-------------------------------------------
- 3.5x to < 4.0x              2.375%
-------------------------------------------
- 3.0x to < 3.5x              2.000%
-------------------------------------------
< 3.0x                        1.750%
-------------------------------------------
</TABLE>

; provided that changes in the Applicable Margin resulting from changes in the
Consolidated Leverage Ratio shall become effective on the date (the "Adjustment
Date") that is three Business Days after the date on which financial statements
are delivered to Administrative Agent pursuant to Section 5.2 and shall remain
in effect until the next change to be effected pursuant to this paragraph. If
any financial statements referred to above are not delivered within the time
periods

                                      -2-

<PAGE>

specified in Section 5.2, then, until the date that is three Business Days after
the date on which such financial statements are delivered, the highest rate set
forth in the Applicable Margin grid above shall apply. In addition, at all times
while an Event of Default shall have occurred and be continuing, the highest
rate set forth in the Applicable Margin grid shall apply. Each determination of
the Consolidated Leverage Ratio pursuant to the Applicable Margin grid shall be
made in a manner consistent with the determination thereof pursuant to Section
6.1.

         "Arrangement Fee Letter" shall have the meaning assigned to that term
in Section 2.9(b).

         "Arrangement Fees" shall have the meaning assigned to that term in
Section 2.9(b).

         "Arrangers" shall mean Bank of America, N.A., Comerica Bank,
Landesbank Schleswig-Holstein Girozentrale, Kiel and Standard Chartered Bank.

         "Asset Sale" shall mean any sale, transfer or other disposition
(including by way of merger, consolidation or sale-leaseback transaction) in one
transaction or a series of related transactions by the Borrower or any of its
Subsidiaries to any Person other than the Borrower or any of its Subsidiaries of
(i) all or any of the Capital Stock of any Subsidiary, (ii) all or substantially
all of the property and assets of an operating unit or business of the Borrower
or any of its Subsidiaries or (iii) any other property and assets of the
Borrower or any of its Subsidiaries, including, without limitation, receivables
outside the ordinary course of business and, in each case, that is not subject
to the provisions of Section 6.11; provided that "Asset Sale" shall not include
sales or other dispositions of current receivables (but not receivables to be
generated in the future) in an aggregate amount not to exceed $25,000,000 at any
time outstanding.

         "Assignment and Acceptance" shall have the meaning assigned to that
term in Section 10.10.

         "Average Life" shall mean, at any date of determination with respect
to any debt security, the quotient obtained by dividing (i) the sum of the
products of (a) the number of years from such date of determination to the dates
of each successive scheduled principal payment of such debt security and (b) the
amount of such principal payment by (ii) the sum of all such principal payments.

         "Bank" shall mean each bank or other financial institution listed on
the signature pages hereof as a "Bank" and any bank or other financial
institution, which becomes a successor or assignee of any such Bank pursuant to
Section 10.10.

         "Bank Affiliate" shall have the meaning assigned to that term in
Section 10.10.

         "Borrower" shall have the meaning assigned to that term in the
preliminary statement hereto.

         "Business Day" shall mean any day other than a Saturday or a Sunday or
a day on which banking institutions are open in New York, New York and London,
England for the

                                      -3-

<PAGE>

transaction of international business, including but not limited to dealings in
Dollar deposits in the international interbank markets.

         "Capital Expenditures" shall mean, with respect to the Borrower and
its Subsidiaries, all expenditures by the Borrower and its Subsidiaries which
should be capitalized in accordance with IAS, including all such expenditures
with respect to fixed or capital assets (including, without limitation,
expenditures for maintenance and repairs which should be capitalized in
accordance with IAS).

         "Capital Stock" shall mean, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) in equity of such Person, whether now outstanding
or issued after the Effective Date, including, without limitation, all Common
Stock and Preferred Stock.

         "Capitalized Lease" shall mean, as applied to any Person, any lease of
any property (whether real, personal or mixed) of which the discounted present
value of the rental obligations of such Person as lessee, in conformity with
IAS, is required to be capitalized on the balance sheet of such Person.

         "Capitalized Lease Obligations" of any Person shall mean all rental
obligations which, under generally accepted accounting principles, are or will
be required to be capitalized on the books of such Person, in each case taken at
the amount thereof accounted for as indebtedness in accordance with such
principles.

         "Change of Control" shall mean such time as:

         (1)     the Existing Holders cease to be the ultimate "beneficial
     owner" (as defined in Rule 13d-3 under the Exchange Act and including by
     reason of any change in the ultimate "beneficial ownership" of the
     Capital Stock of Grupo TFM) of Voting Stock representing more than 50.0%
     of the total voting power of the total Voting Stock of Grupo TFM on a
     fully diluted basis;

         (2)     individuals who on the Effective Date constitute the Board of
     Directors of the Borrower or Grupo TFM (together with any new directors
     whose election by the Board of Directors or by the Borrower's
     stockholders or Grupo TFM's stockholders, as the case may be, was
     approved by a vote of at least two-thirds of the members of such Board of
     Directors then in office who either were members of such Board of
     Directors on the Effective Date or whose election or nomination for
     election was previously so approved or who were appointed by one or more
     of the Existing Holders) cease for any reason to constitute a majority of
     the members of such Board of Directors then in office;

         (3)     Grupo TFM does not own all of the outstanding Voting Stock of
     the Borrower other than as a result of (A) one or more primary offerings
     of Common Stock of the Borrower having, in the aggregate, voting power
     equal to or less than 35% of the total voting power of the Voting Stock
     of the Borrower, so long as Grupo TFM shall remain the beneficial owner
     of at least 65% of the outstanding Voting Stock of the Borrower or (B) a
     merger, consolidation, sale, transfer or lease solely between Grupo TFM
     and the Borrower; or

                                      -4-

<PAGE>

         (4)     a "change in control" as defined in any Senior Note Indenture
     shall occur.

         "Commitment" shall mean, in the case of any Bank, such Bank's
obligation to make a Term Loan hereunder, not to exceed the amount set forth
next to such Bank's name in Schedule 1.1(a) at any time outstanding.

         "Commitment Percentage" shall mean, as to any Bank at any time, the
percentage which such Bank's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Effective Date, the percentage which the
aggregate principal amount of such Bank's Term Loans then outstanding
constitutes of the aggregate principal amount of the Term Loans then
outstanding).

         "Common Stock" shall mean, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or nonvoting) of such Person's equity, other than Disqualified
Stock of such Person, whether now outstanding or issued after the Effective
Date, including all Common Stock or Preferred Stock (other than Disqualified
Stock). For purposes of this definition, "Common Stock" shall include all
shares, interests, participations and equivalents corresponding to common stock
(other than Disqualified Stock) under the laws of the jurisdiction in which such
Person is organized.

         "Concession Title" shall mean the Borrower's right for a period of 30
years, to be the exclusive provider (subject to certain trackage rights) of
freight transportation services over the Northeast Rail Lines and for an
additional 20 years to be a non-exclusive provider of such services granted by
the Mexican government pursuant to the Concession Title, subject in all cases to
the terms and conditions of the Concession Title, as in effect on June 23, 1997,
the date on which Grupo TFM acquired 80% of the Capital Stock of the Borrower.

         "Consolidated EBIT" shall mean, for any period, the Consolidated Net
Income for such period, increased by interest expense and provision for taxes
based on income and without giving effect to any extraordinary gains or losses
otherwise reflected in Consolidated Net Income.

         "Consolidated EBITDA" shall mean, for any period, Consolidated EBIT,
adjusted by adding thereto the amount of all amortization and depreciation, in
each case that were deducted in arriving at Consolidated EBIT for such period.

         "Consolidated Fixed Charge Coverage Ratio" shall mean, for any period,
the ratio of (i) Consolidated EBITDA for such period to (ii) Consolidated Fixed
Charges for such period.

         "Consolidated Fixed Charges" for any period shall mean the sum,
without duplication, of (i) Consolidated Interest Expense for such period, (ii)
the amount of all Capital Expenditures made by the Borrower and its Consolidated
Subsidiaries during such period, (iii) all cash payments in respect of taxes
made during such period (net of any cash refunds actually received during such
period), (iv) the scheduled principal amount of all amortization payments on all
Indebtedness (including without limitation the principal component of all
Capitalized Lease Obligations) of the Borrower and its Consolidated Subsidiaries
for such period (as determined on the first day of the respective period), but
excluding any payments refinanced with the proceeds of the CP Notes and the Term
Loans, (v) all cash payments made by the

                                      -5-

<PAGE>

Borrower for the benefit of employees pursuant to profit sharing plans in
accordance with applicable Mexican law (vi) all cash dividend payments and (vii)
the amount of postings of cash collateral and other payments related to Swap
Agreements outstanding at the end of such period.

         "Consolidated Indebtedness" shall mean, as at any date of
determination, the aggregate stated balance sheet amount of all Indebtedness
(including in any event the then outstanding principal amount of all
"Outstanding Extensions of Credit" (as defined in the CP Facility), Term Loans,
Senior Unsecured Notes I and II and all Capitalized Lease Obligations and the
aggregate face amount (without giving effect to the discount on issuance) of the
Senior Discount Debentures) of the Borrower and its Subsidiaries on a
consolidated basis as determined in accordance with IAS.

         "Consolidated Interest Coverage Ratio" shall mean, for any period, the
ratio of (i) Consolidated EBITDA for such period to (ii) Consolidated Interest
Expense for such period.

         "Consolidated Interest Expense" shall mean, for any period, the total
consolidated interest expense of the Borrower and its Consolidated Subsidiaries
for such period (calculated without regard to any limitations on the payment
thereof) plus, without duplication, that portion of Capitalized Lease
Obligations of the Borrower and its Consolidated Subsidiaries representing the
interest factor for such period in any event (i) including (x) the amortization
of any original issue discount in connection with the Senior Discount Debentures
and (y) withholding or similar taxes paid by the Borrower and its Consolidated
Subsidiaries arising from, or in connection with, the payment of interest, fees
and any other amounts (in any event, including all Additional Amounts and
withholdings with respect to the Senior Notes paid during such period), but (ii)
excluding the amortization of any other deferred financing costs incurred in
connection with this Agreement or the issuance of the Senior Notes and any other
permitted Indebtedness.

         "Consolidated Leverage Ratio" shall mean, as at the last day of any
period, the ratio of (i) Consolidated Indebtedness on such date to (ii)
Consolidated EBITDA for such period.

         "Consolidated Net Income" shall mean, for any period, the consolidated
net after tax income of the Borrower and its Consolidated Subsidiaries
determined in accordance with IAS.

         "Consolidated Net Worth" shall mean, at any date of determination,
stockholders' equity as set forth on the most recently available quarterly or
annual consolidated balance sheet of the Borrower and its Subsidiaries (which
shall be as of a date not more than 90 days prior to the date of such
computation), less any amounts attributable to Disqualified Stock or any equity
security convertible into or exchangeable for Indebtedness, the cost of treasury
stock and the principal amount of any promissory notes receivable from the sale
of the Capital Stock of the Borrower or any of its Subsidiaries, each item to be
determined in conformity with IAS.

         "Consolidated Subsidiaries" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes in accordance with IAS.

         "Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to

                                      -6-

<PAGE>

exercise voting power, by contract or otherwise. "Controlling" and "Controlled"
have meanings correlative thereto.

         "CP Facility" shall mean the $100,000,000 Credit Agreement, dated as of
_________ __, 2002, among TFM, S.A. de C.V., as borrower, J.P. Morgan
Securities, Inc. and Salomon Smith Barney, Inc. as joint lead arrangers,
JPMorgan Chase Bank as the administrative agent and the banks named therein.

         "CP Facility Extensions of Credit" shall mean "Loans" and unreimbursed
"LOC Advances" under, and each as defined in, the CP Facility.

         "CP Notes" shall mean the collective reference to any promissory note
of the Borrower in book entry form issued in accordance with the terms of the
Depositary Agreement, dated as of September 17, 2002, among TFM, S.A. de C.V.,
as Borrower, JPMCB, as administrative agent, Standard Chartered Bank, as Issuing
Bank, and JPMCB, as depositary.

         "Default" shall mean any of the events specified in Section 7.1,
whether or not any requirement for the giving of notice or lapse of time or both
has been satisfied.

         "Disbursement Date" shall have the meaning assigned to that term in
Section 2.1.

         "Disqualified Stock" shall mean any class or series of Capital Stock of
any Person that by its terms or otherwise is (i) required to be redeemed prior
to the Maturity Date; (ii) redeemable at the option of the holder of such class
or series of Capital Stock at any time prior to the Maturity Date; or (iii)
convertible into or exchangeable for Capital Stock referred to in clause (i) or
(ii) above or Indebtedness having a scheduled maturity prior to the Maturity
Date.

         "Dollars" and "US$" shall mean lawful money of the United States of
America.

         "Documentation Agent" shall mean Standard Chartered Bank.

         "Domestic Lending Office" shall mean, with respect to any Bank,
initially, the office of such Bank designated as such in Schedule 1.1(b);
thereafter, such other office of such Bank registered with Hacienda or organized
and licensed under the laws of Mexico, if any, which shall be making or
maintaining Term Loans in accordance with the provisions of this Agreement.

         "Effective Date" shall mean the date on which all of the conditions set
forth in Section 3.1 hereof have been fulfilled.

         "Environmental Laws" shall mean any and all federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
regulating, relating to or imposing liability or standards of conduct concerning
protection of human health or the environment, as now or may at any time
hereafter be in effect.

         "Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of

                                      -7-

<PAGE>

the Borrower or any Subsidiary directly or indirectly resulting from or based
upon (a) violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.

         "Eurocurrency Liabilities" shall mean, with respect to any Bank, the
full reserve requirement percentage imposed in respect of "Eurocurrency
Liabilities", as such term is defined in Regulation D (or any successor
provision) (including any marginal, emergency, supplemental, special or other
reserves) of the Board of Governors of the Federal Reserve System, that such
Bank in its sole discretion determines to be applicable to such Bank for each
day during an Interest Period.

         "Event of Default" shall have the meaning assigned to that term in
Section 7.1.

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

         "Existing CP Facility" shall mean the $293,000,000 commercial paper
program under the Credit Facility, dated September 19, 2000, by and among the
Borrower, Westdeutsche Landesbank Girozentrale, New York Branch, as issuing
bank, J.P. Morgan Securities Inc., as lead arranger, Banc of America Securities
LLC and Westdeutsche Landesbank Girozentrale, New York Branch, as
co-documentation agents and arrangers, JPMorgan Chase Bank, as administrative
agent and the banks party thereto.

         "Existing Holders" shall mean KCSI and Grupo TMM.

         "Facility Expenses" shall have the meaning assigned to that term in
Section 10.3.

         "fair market value" means the price that would be paid in an
arm's-length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to buy,
as determined in good faith by the Board of Directors, whose determination shall
be conclusive if evidenced by a Board Resolution.

         "Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.

         "Fee Letters" shall mean, collectively, the Administration Fee Letter
and the Arrangement Fee Letter.

         "Fees" shall mean the collective reference to the Administration Fees,
the Arrangement Fees and the Up-Front Fees.

                                      -8-

<PAGE>

         "Governmental Authority" shall mean any nation or government, any state
or other political or administrative subdivision thereof, any central bank (or
similar monetary or regulatory authority) and any entity exercising executive,
legislative, judicial, regulatory or administrative authority of or pertaining
to government.

         "Grupo TFM" shall mean Grupo Transportacion Ferroviaria Mexicana, S.A.
de C.V., a limited liability company with variable capital (sociedad anonima de
capital variable) organized under the laws of Mexico.

         "Grupo TMM" means Grupo TMM, S.A. de C.V., a limited liability company
with variable capital (sociedad anonima de capital variable) organized under the
laws of Mexico, and its successors.

         "Guarantee" shall mean any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing (whether pursuant to a guaranty, a
fianza, an aval or otherwise) any Indebtedness of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (1) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness of such other
Person (whether arising by virtue of partnership arrangements, or by agreements
to keep-well, to purchase assets, goods, securities or services (unless such
purchase arrangements are on arm's length terms and are entered into in the
ordinary course of business), to take-or-pay, or to maintain financial statement
conditions or otherwise) or (2) entered into for purposes of assuring in any
other manner the obligee of such Indebtedness of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or in part);
provided that the term "Guarantee" shall not include endorsements for collection
or deposit in the ordinary course of business or obligations arising, in the
ordinary course of business, from contracting for interline railroad services.
The term "Guarantee" used as a verb has a corresponding meaning.

         "Guaranteed Indebtedness" shall have the meaning assigned to that term
in Section 6.6(a).

         "Hacienda" shall mean the Secretaria de Hacienda y Credito Publico
(Ministry of Finance and Public Credit) of Mexico.

         "Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.

         "IAS" shall mean the accounting principles issued by the International
Accounting Standards Committee, as in effect from time to time.

         "Incur" shall mean, with respect to any Indebtedness, to incur, create,
issue, assume, Guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, such
Indebtedness,; provided that neither the accrual of interest nor the accretion
of original issue discount shall be considered an Incurrence of Indebtedness.

                                      -9-

<PAGE>

         "Indebtedness" shall mean, with respect to any Person at any date of
determination (without duplication):

         (a)     all indebtedness of such Person for borrowed money;

         (b)     all obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments;

         (c)     all obligations of such Person in respect of letters of credit
or other similar instruments (including reimbursement obligations with respect
thereto, but excluding obligations with respect to letters of credit (including
trade letters of credit) securing obligations (other than obligations described
in clauses (a) or (b) above or (e), (f) or (g) below) entered into in the
ordinary course of business of such Person to the extent such letters of credit
are not drawn upon or, if drawn upon, to the extent such drawing is reimbursed
no later than the third Business Day following receipt by such Person of a
demand for reimbursement);

         (d)     all obligations of such Person to pay the deferred and unpaid
purchase price of property or services, which purchase price is due more than
six months after the date of placing such property in service or taking delivery
and title thereto or the completion of such services, except Trade Payables;

         (e)     all obligations of such Person as lessee under Capitalized
Leases (but not operating leases);

         (f)     all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such
Person; provided that the amount of such Indebtedness shall be the lesser of (A)
the fair market value of such asset at such date of determination and (B) the
amount of such Indebtedness;

         (g)     all Indebtedness of other Persons Guaranteed by such Person to
the extent such Indebtedness is Guaranteed by such Person; and

         (h)     to the extent not otherwise included in this definition,
obligations to make payments under Swap Agreements.

         The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and, with respect to contingent obligations, the maximum liability upon
the occurrence of the contingency giving rise to the obligation, provided (A)
that the amount outstanding at any time of any Indebtedness issued with original
issue discount is the face amount of such Indebtedness less the unamortized
portion of the original issue discount of such Indebtedness at the time of its
issuance as determined in conformity with IAS, (B) that money borrowed and set
aside at the time of the Incurrence of any Indebtedness in order to prefund the
payment of interest on such Indebtedness shall be deemed not to be
"Indebtedness" and (C) that Indebtedness shall not include any liability for
federal, state, local or other taxes of any jurisdiction.

         "Interest Payment Date" shall mean (a) as to any Term Loan having an
Interest Period of three months or less, the last day of such Interest Period,
(b) as to any Term Loan

                                      -10-

<PAGE>

having an Interest Period longer than three months, each day that is three
months, or a whole multiple thereof, after the first day of such Interest Period
and the last day of such Interest Period, and (c) the date of any repayment or
prepayment made in respect of any Term Loan.

         "Interest Period" shall mean, initially the period commencing on the
Disbursement Date and ending on the numerically corresponding day in the
calendar month three or six months thereafter, as selected by the Borrower in
its Notice of Borrowing as provided in Section 2.2 and, thereafter, each period
commencing on the last day of the next preceding Interest Period and ending
three or six months thereafter, as selected by the Borrower by irrevocable
notice to the Administrative Agent not later than 11:00 a.m. New York City time,
on the date that is three Business Days prior to the last day of the then
current Interest Period with respect thereto; provided that, (i) if any Interest
Period would otherwise end on a day which is not a Business Day, that Interest
Period shall be extended to the immediately succeeding Business Day unless the
result of such extension would be to carry such Interest Period into another
calendar month in which event such Interest Period shall end on the immediately
preceding Business Day, (ii) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of a calendar month and (iii) if any Interest
Period would otherwise (but for this clause (iii)) extend beyond the Maturity
Date, then such Interest Period shall end on the Maturity Date.

         "Investment" in any Person means any direct or indirect advance, loan
or other extension of credit (including, without limitation, by way of Guarantee
or similar arrangement; but excluding advances to customers in the ordinary
course of business that are, in conformity with IAS, recorded as accounts
receivable on the balance sheet of the Borrower or that of its Subsidiaries) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, bonds, notes,
debentures or other similar instruments issued by, such Person.

         "Joint Lead Arrangers" shall mean the joint lead arrangers appointed
by the Borrower pursuant to a mandate letter and Section 9.1 hereof, initially,
J.P. Morgan Securities Inc., Salomon Smith Barney, Inc. and each of their
successors in such capacity.

         "JPMCB" shall mean JPMorgan Chase Bank.

         "KCSI" means Kansas City Southern Industries, Inc., a Delaware
corporation, and its successors.

         "Lending Office" shall mean, with respect to any Bank, initially, the
office of such Bank designated as such in Schedule 1.1(b); thereafter, such
other office of such Bank registered with Hacienda or organized and licensed
under the laws of Mexico, if any, which shall be making or maintaining Term
Loans in accordance with the provisions of this Agreement.

         "LIBOR" shall mean, with respect to the applicable Interest Period,
the rate for deposits in Dollars for a period equal to such Interest Period
quoted on the second Business Day prior to the first day of such Interest
Period, as such rate appears on Page 3750 of the Dow Jones

                                      -11-

<PAGE>

Market Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to Dollar deposits in the
London interbank market) as of 11:00 a.m. (London time) on such date; in each
case as determined by the Administrative Agent and notified to the Banks and the
Borrower on such second prior Business Day. If LIBOR cannot be determined based
on Page 3750 of the Dow Jones Market Service, LIBOR means the average of the
rates per annum, as supplied to the Administrative Agent, quoted by the
respective London Branches of JPMCB and Citibank, N.A. to prime banks in the
London interbank market for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
in an amount approximately equal to the principal amount of the Term Loans to
which such Interest Period is to apply and for a period of time comparable to
such Interest Period.

         "Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any other contractual or statutory arrangement or provision having
substantially the same economic, financial or operational effect as any of the
foregoing); including, without limitation, any device, including without
limitation, a foreign, including Mexican, trust or joint venture, for the
purpose of setting aside funds for facilitating payments to any person or group
of persons.

         "Majority Banks" shall mean at a particular time, Banks the sum of
whose Commitments represents at least 662/3% of the aggregate Commitments (or,
after all of the Commitments have terminated, the Banks, the sum of whose Term
Loans represent at least 662/3% of the Term Loans of all the Banks).

         "Management Fees" shall mean the management fees payable to KCSI and
Grupo TMM, and their respective Affiliates, shareholders, partners, directors or
other persons, pursuant to (a) the Management Services agreement, dated May 9,
1997, between KCS Transportation Company and the Borrower and (b) the Management
Services agreement, dated May 9, 1997, between Grupo TMM and the Borrower;
provided that in no event shall such management fees incurred (whether or not
paid) in any fiscal year exceed $2,500,000 (which may be adjusted upward based
on the U.S. Consumer Price Index).

         "Material Adverse Effect" shall mean a material adverse effect on (a)
the business, operations, property, condition (financial or otherwise) or
prospects of the Borrower and its subsidiaries taken as a whole or (b) the
validity or enforceability of this Agreement or of the Notes or the rights or
remedies of the Administrative Agent or the Banks hereunder or thereunder.

         "Maturity Date" shall mean the fourth anniversary of the Effective
Date, which date is __________ __, 2006.

         "Mexican Note" shall have the meaning assigned to that term in Section
2.1(c).

                                      -12-

<PAGE>

         "Mexico" shall mean the Estados Unidos Mexicanos (the United Mexican
States).

         "Mexrail" shall mean Mexrail, Inc., a Delaware corporation, and its
successors.

         "Moody's" shall mean Moody's Investors Service, Inc. and its
successors.

         "Net Cash Proceeds" shall mean (a) with respect to any Asset Sale, the
proceeds of such Asset Sale in the form of cash or cash equivalents, including
payments in respect of deferred payment obligations (to the extent corresponding
to the principal, but not interest, component thereof) when received in the form
of cash or cash equivalents (except to the extent such obligations are financed
or sold with recourse to the Borrower or any of its Subsidiaries) and proceeds
from the conversion of other property received when converted to cash or cash
equivalents, net of (i) brokerage commissions and other fees and expenses
(including fees and expenses of counsel and investment bankers) related to such
Asset Sale, (ii) provisions for all taxes (whether or not such taxes will
actually be paid or are payable) as a result of such Asset Sale without regard
to the consolidated results of operations of the Borrower and its Subsidiaries,
taken as a whole, (iii) payments made to repay Indebtedness or any other
obligation outstanding at the time of such Asset Sale that either (A) is secured
by a Lien on the property or assets sold or (B) is required to be paid as a
result of such sale and (iv) appropriate amounts to be provided by the Borrower
or any of its Subsidiaries as a reserve against any liabilities associated with
such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale, all as determined in conformity with IAS; and (b) with respect
to any issuance or sale of Capital Stock, the proceeds of such issuance or sale
in the form of cash or cash equivalents, including payments in respect of
deferred payment obligations (to the extent corresponding to the principal, but
not interest, component thereof) when received in the form of cash or cash
equivalents (except to the extent such obligations are financed or sold with
recourse to the Borrower or any of its Subsidiaries) and proceeds from the
conversion of other property received when converted to cash or cash
equivalents, net of attorneys' fees, accountants' fees, underwriters' or
discounts or commissions and brokerage, consultant and other fees incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.

         "Northeast Rail Lines" shall mean that portion of the Mexican railroad
system that is the subject of the Concession Title.

         "Notes" shall have the meaning assigned to that term in Section 2.1.

         "Notice of Borrowing" shall have the meaning assigned to that term in
Section 2.2 and shall be substantially in the form of Exhibit D.

         "Obligations" shall mean all of the obligations and liabilities of the
Borrower to the Banks, the Joint Lead Arrangers, the Arrangers, the
Documentation Agent and/or the Administrative Agent now or in the future
existing under or in connection with this Agreement and the Notes (as any of the
foregoing may from time to time be respectively amended, modified, substituted,
extended or renewed), direct or indirect, absolute or contingent, due or to
become due, now or hereafter existing.

         "Participant" shall have the meaning assigned to that term in Section
10.11.

                                      -13-

<PAGE>

         "Participation Agreement" shall have the meaning assigned to that term
in Section 10.11.

         "Permitted Investment" shall mean (i) an Investment in the Borrower or
any of its Subsidiaries or a Person which will, upon the making of such
Investment, become a Subsidiary or be merged or consolidated with or into or
transfer or convey all or substantially all of its assets to the Borrower or one
of its Subsidiaries; provided that (a) such Person's primary business is
related, ancillary or complementary to the businesses of the Borrower and its
Subsidiaries on the date of such Investment and (b) the Borrower is in
compliance on a pro forma basis with the covenants set forth in Section 6.1
after giving effect to such Investment as if such Investment had been made on
the first day of the four fiscal quarter period most recently ended; (ii)
Temporary Cash Investments; (iii) payroll, travel and similar advances to cover
matters that are expected at the time of such advances ultimately to be treated
as expenses in accordance with IAS; and (iv) stock, obligations or securities
received in satisfaction of judgments.

         "Permitted Liens" shall mean:

         (a)      Liens for taxes, assessments, governmental charges or claims
that are being contested in good faith by appropriate legal proceedings promptly
instituted and diligently conducted and for which a reserve or other appropriate
provision, if any, as shall be required in conformity with IAS shall have been
made;

         (b)      statutory and common law Liens of landlords and carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other similar
Liens arising in the ordinary course of business and with respect to amounts not
yet delinquent or being contested in good faith by appropriate legal proceedings
promptly instituted and diligently conducted and for which a reserve or other
appropriate provision, if any, as shall be required in conformity with IAS shall
have been made;

         (c)      Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other types of social security;

         (d)      Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligations, bankers'
acceptances, surety and appeal bonds, government contracts, performance and
return-of-money bonds and other obligations of a similar nature incurred in the
ordinary course of business (exclusive of obligations for the payment of
borrowed money);

         (e)      easements, rights-of-way, municipal and zoning ordinances and
similar charges, encumbrances, title defects or other irregularities that do not
materially interfere with the ordinary course of the business of the Borrower or
any of its Subsidiaries;

         (f)      Liens (including extensions and renewals thereof) upon real or
personal property acquired after the Effective Date; provided that (i) such
Liens are created solely for the purpose of securing Indebtedness not in excess
of $10,000,000 in the aggregate at any time outstanding which is Incurred to
finance the cost (including the cost of improvement, lease or construction) of
the item of property or assets subject thereto and such Lien is created prior
to, at

                                      -14-

<PAGE>

the time of or within 180 days after the later of the acquisition, the
completion of construction or the commencement of full operation or the lease of
such property, (ii) the principal amount of the Indebtedness secured by such
Lien does not exceed 100.0% of such cost and (iii) any such Lien shall not
extend to or cover any property or assets other than such item of property or
assets and any improvements on such item;

         (g)      licenses, leases or subleases granted to others that do not
materially interfere with the ordinary course of the business of the Borrower
and its Subsidiaries, taken as a whole;

         (h)      Liens encumbering property or assets under construction
arising from progress or partial payments by one of the customers of the
Borrower or its Subsidiaries relating to such property or assets the amount of
such payments secured by such Liens not to exceed $10,000,000 in the aggregate
at any time outstanding;

         (i)      any interest or title of a lessor or licensor in the property
subject to any Capitalized Lease, operating lease or license agreement, provided
that the aggregate amount of such Capitalized Leases, operating leases and
licensing agreements does not exceed $10,000,000 in the aggregate at any time
outstanding;

         (j)      Liens arising from filing Uniform Commercial Code or similar
financing statements regarding leases;

         (k)      Liens on property of, or on shares of stock or Indebtedness
of, any Person existing at the time such Person becomes, or becomes a part of,
any Subsidiary; provided that such Liens do not extend to or cover any property
or assets of the Borrower or any Subsidiary other than the property or assets
acquired;

         (l)      Liens arising from the rendering of a final judgment or order
against the Borrower or any of its Subsidiaries that does not give rise to an
Event of Default;

         (m)      Liens securing reimbursement obligations with respect to
letters of credit that encumber documents and other property relating to such
letters of credit and the products and proceeds thereof;

         (n)      Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;

         (o)      Liens encumbering customary initial deposits and margin
deposits, and other customary Liens on cash and cash deposits, in each case,
securing Indebtedness under Swap Agreements designed solely to protect the
Borrower or any of its Subsidiaries from fluctuations in interest rates,
currencies or the price of commodities;

         (p)      Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by the
Borrower or any of its Subsidiaries in the ordinary course of business;

                                      -15-

<PAGE>

         (q)      Liens on existing accounts receivable in an amount not to
exceed $25,000,000 in the aggregate at any time outstanding (but not receivables
to be generated in the future) of the Borrower or any of its Subsidiaries; and

         (r)      Liens on any assets acquired by the Borrower or any of its
Subsidiaries after the Effective Date, which Liens were in existence prior to
the acquisition of such assets (to the extent that such Liens were not created
in contemplation of or in connection with such acquisition), provided that such
Liens are limited to the assets so acquired and the proceeds thereof.

         "Person" shall mean any corporation, partnership, joint venture, trust,
limited liability company, individual or other person or entity of any kind.

         "Preferred Stock" shall mean, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's preferred or preference equity,
whether now outstanding or issued after the Effective Date, including, without
limitation, all series and classes of such preferred stock or preference stock.

         "Public Equity Offering" shall mean an underwritten primary public
offering of Capital Stock of the Borrower pursuant to an effective registration
statement under the Securities Act of 1933, as amended.

         "Rate of Exchange" shall have the meaning assigned to that term in
Section 10.14.

         "Reinvestment Deferred Amount" shall mean, with respect to any
Reinvestment Event, the aggregate Net Cash Proceeds received by the Borrower or
one of its Subsidiaries in connection therewith that are not applied to prepay
the Term Loans or reduce the Commitments pursuant to Section 2.4(b) as a result
of the delivery of a Reinvestment Notice.

         "Reinvestment Event" shall mean any Asset Sale or issuance of Capital
Stock under Section 6.5(d) in respect of which the Borrower has delivered a
Reinvestment Notice.

         "Reinvestment Notice" shall mean a written notice executed by a
Responsible Officer stating that no Event of Default has occurred and is
continuing and that the Borrower (directly or indirectly through a Subsidiary)
intends and expects to use all or a specified portion of the Net Cash Proceeds
of an Asset Sale or issuance of Capital Stock to acquire or repair assets useful
in its business.

         "Reinvestment Prepayment Amount" shall mean with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any
amount expended prior to the relevant Reinvestment Prepayment Date to acquire or
repair assets useful in the Borrower's business.

         "Reinvestment Prepayment Date" shall mean with respect to any
Reinvestment Event, the earlier of (a) the date occurring 180 days after such
Reinvestment Event and (b) the date on which the Borrower shall have determined
not to, or shall have otherwise ceased to,

                                      -16-

<PAGE>

acquire or repair assets useful in the Borrower's business with all or any
portion of the relevant Reinvestment Deferred Amount.

         "Related Parties" shall mean, with respect to any specified Person,
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.

         "Requirement of Law" shall mean, as to any Person, any law, treaty,
rule or regulation or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject.

         "Responsible Officer" of a Person shall mean the Chairman, Chief
Executive Officer, President, any Executive Director, Director, Vice President,
Treasurer or Assistant Treasurer of that Person, in each case authorized to the
extent required by a board resolution or shareholder meeting; provided that such
officer is then authorized to bind such Person.

         "Restricted Payments" shall have the meaning assigned to that term in
Section 6.3(a).

         "S&P" shall mean Standard & Poor's Ratings Group and its successors.

         "Senior Discount Debentures" shall mean the Borrower's 11 3/4% Senior
Discount Debentures due 2009 issued pursuant to the Senior Discount Debentures
Indenture and any notes issued by the Borrower in exchange for, and as
contemplated by, the Senior Discount Debentures with substantially identical
terms as the Senior Discount Debentures.

         "Senior Discount Debentures Indenture" shall mean the indenture, dated
as of June 16, 1997, among Grupo TFM, the Borrower and The Bank of New York, as
amended, supplemented or otherwise modified from time to time.

         "Senior Notes" shall mean, collectively, the Senior Unsecured Notes I
and II and the Senior Discount Debentures.

         "Senior Notes Indentures" shall mean, together, the Senior Discount
Debentures Indenture and the Senior Unsecured Notes Indentures I and II.

         "Senior Unsecured Notes I" shall mean the Borrower's 10 1/4% Senior
Notes due 2007 issued pursuant to the Senior Unsecured Notes Indenture I and any
notes issued by the Borrower in exchange for, and as contemplated by, the Senior
Unsecured Notes I with substantially identical terms as the Senior Unsecured
Notes I.

         "Senior Unsecured Notes II" shall mean the Borrower's 12 1/2% Senior
Notes due 2012 issued pursuant to the Senior Unsecured Notes Indenture II and
any notes issued by the Borrower in exchange for, and as contemplated by, the
Senior Unsecured Notes II with substantially identical terms as the Senior
Unsecured Notes II.

                                      -17-

<PAGE>

         "Senior Unsecured Notes Indenture I" shall mean the indenture, dated as
of June 16, 1997, among Grupo TFM, the Borrower and The Bank of New York, as
amended, supplemented or otherwise modified from time to time.

         "Senior Unsecured Notes Indenture II" shall mean the indenture, dated
as of June 13, 2002, among Grupo TFM, the Borrower and The Bank of New York, as
amended, supplemented or otherwise modified from time to time.

         "Simple Note" shall have the meaning assigned to that term in Section
2.1(b).

         "Subsidiary" shall mean, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
or by such Person and one or more other Subsidiaries of such Person.

         "Swap Agreement" means any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
the Borrower or the Subsidiaries shall be a Swap Agreement.

         "Taxes" shall mean any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.

         "Temporary Cash Investment" shall mean any of the following: (i) direct
obligations of the United States of America or any agency thereof or obligations
fully and unconditionally guaranteed by the United States of America or any
agency thereof; (ii) time deposit accounts, certificates of deposit and money
market deposits denominated and payable in U.S. Dollars maturing within 180 days
of the date of acquisition thereof issued by a bank or trust company which is
organized under the laws of the United States of America, any state thereof or
any foreign country recognized by the United States of America, and which bank
or trust company has capital, surplus and undivided profits aggregating in
excess of $200,000,000 (or the foreign currency equivalent thereof) and has
outstanding debt which is rated "A" (or such similar equivalent rating) or
higher by S&P or Moody's or any money-market fund denominated and payable in
U.S. dollars sponsored by a registered broker dealer or mutual fund distributor;
(iii) repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clause (i) above entered into with a bank
meeting the qualifications described in clause (ii) above; (iv) commercial paper
denominated and payable in U.S. Dollars, maturing not more than 90 days after
the date of acquisition, issued by a corporation (other than an Affiliate of the
Borrower) organized and in existence under the laws of the United States of
America or any state thereof with a rating at the time as of which any
investment therein is made of "P-1" (or higher) according to Moody's or "A-1"
(or higher) according to S&P; (v) securities with maturities of six months or
less from the date of acquisition issued or fully and unconditionally guaranteed
by any state, commonwealth or territory of the United States of America, or by
any

                                      -18-

<PAGE>

political subdivision or taxing authority thereof, and rated at least "A" by S&P
or Moody's; (vi) Certificados de la Tesoreria de la Federacion (Cetes) or Bonos
de Desarrollo del Gobierno Federal (Bondes) issued by the Mexican government and
maturing not more than 180 days after the acquisition thereof, (vii) Investments
in money market funds substantially all of whose assets are comprised of
securities of the types described in clauses (i) through (vi) above; (viii)
demand deposit accounts with U.S. banks (or Mexican banks specified in clause
(ix) of this definition) maintained in the ordinary course of business; and (ix)
certificates of deposit, bank promissory notes and bankers' acceptances
denominated in Mexican pesos, maturing not more than 180 days after the
acquisition thereof and issued or guaranteed by any one of the five largest
banks (based on assets as of the immediately preceding December 31) organized
under the laws of Mexico and which are not under intervention or controlled by
the Fondo Bancario de Proteccion al Ahorro or any successor thereto.

         "Term Loans" shall have the meaning specified in Section 2.1(a).

         "Texas Mexican Railway Company" means the Texas Mexican Railway
Company, a Texas corporation, and its successors.

         "Trade Payables" shall mean, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary course of business in connection with the acquisition of goods
or services.

         "Tranche" shall mean all outstanding Term Loans having the same
Interest Period.

         "Transaction Date" shall mean, with respect to any Restricted Payment,
the date such Restricted Payment is to be made.

         "Up-Front Fees" shall have the meaning assigned to that term in Section
2.9(c).

         "VAT Refund" shall mean the amount of value added taxes paid or payable
to the Borrower by Mexico as a result of matters pending on June 16, 1997 with
respect to such value added taxes.

         "Voting Stock" means with respect to any Person, capital stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person,
excluding, however, Class III Series A shares and Class III Series B shares of
the Borrower owned by Mexico as of June 23, 1997 and any class or kind of
capital stock which has limited or restricted voting rights (i.e., having the
power to vote for the election of a minority of the directors, managers or other
voting members of the governing body of each class) under the By-laws of such
Person or under Mexican law.

         "Wholly Owned" shall mean, with respect to any Subsidiary of any
Person, the ownership of all of the outstanding Capital Stock of such Subsidiary
(other than any director's qualifying shares, Investments by foreign nationals
mandated by applicable law or any minimum statutorily required shares under
Mexican law) by such Person or one or more Wholly Owned Subsidiaries of such
Person.

                                      -19-

<PAGE>

         SECTION 1.2.      Other Definitional Provisions.

         (a)      Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes or any
certificate or other document made or delivered pursuant hereto.

         (b)      As used herein and in the Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms not defined herein
shall have the meanings customarily given in accordance with IAS as in effect on
the Effective Date. All ratios and computations shall be computed in conformity
with IAS applied on a consistent basis in U.S. Dollars.

         (c)      The term "including" is not limiting and means "including
without limitation".

         (d)      The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.

         (e)      The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

         (f)      In this Agreement, in the computation of periods of time from
a specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each mean "to but excluding". Periods
of days referred to in this Agreement shall be counted in calendar days unless
Business Days are expressly prescribed.

                                   ARTICLE II

                        AMOUNTS AND TERMS OF COMMITMENTS

         SECTION 2.1.      Commitments; Notes. (a) Subject to the terms and
conditions hereof, each Bank severally agrees to make a term loan (individually,
a "Term Loan" and, collectively, "Term Loans") to the Borrower on any Business
Day during the five Business Days following the Effective Date (the
"Disbursement Date") in an amount not to exceed the amount of the Commitment of
such Bank.

         (b)     The Term Loans made by each Bank shall, subject to the
provisions of Section 2.1(c) below, be evidenced by a promissory note of the
Borrower in substantially the form of Exhibit A-1 appropriately completed (each,
a "Simple Note"; and, collectively and together with any Mexican Notes issued
pursuant to Section 2.1(c) below, the "Notes"), in the principal amount of such
Bank's Commitment representing the obligation of the Borrower to pay to such
Bank the unpaid principal amount of all such Term Loans made by such Bank
pursuant to Section 2.1(a), plus interest thereon as provided in Sections 2.5
and 2.6. The date and principal amount of each Term Loan made by such Bank, and
the date and amount of each payment or prepayment of the principal amount of
each such Term Loan, shall be recorded by such Bank on the Schedules annexed to
its Simple Note and such Schedules shall constitute prima facie

                                      -20-

<PAGE>

evidence of the accuracy of the information so recorded, provided, however, that
the failure of any Bank to make such recordation (or any error in such
recordation) shall not affect the obligations of the Borrower hereunder or under
the Simple Notes.

         (c)     The Borrower agrees that whenever a Term Loan is made
hereunder, or at any time while a Term Loan made hereunder is outstanding, upon
the request of any Bank holding a Simple Note in respect of any portion of such
Term Loan, the Borrower shall issue to such Bank, against delivery to the
Borrower, for cancellation, of such Simple Note, a new promissory note in the
form of Exhibit A-2 hereto appropriately completed (a "Mexican Note"), in the
principal amount of the outstanding Term Loan that is evidenced by the Simple
Note.  Each Bank acknowledges and agrees that if it requests a Mexican Note in
respect of its portion of any Term Loan hereunder, then it shall be obligated to
accept a Mexican Note in respect of its portion of all Term Loans hereunder, and
that the Borrower shall have no further obligation to issue to it any Simple
Notes.

         SECTION 2.2.      Procedure for Borrowing. The Borrower shall give the
Administrative Agent irrevocable notice, substantially in the form of Exhibit D
(which notice must be received by the Administrative Agent prior to 10:00 a.m.,
New York City time, at least three Business Days prior to the Disbursement Date)
requesting that the Banks make the Term Loans on the Disbursement Date and
specifying the amount thereof and the initial Interest Period therefor (the
"Notice of Borrowing"). Upon receipt of such notice the Administrative Agent
shall promptly notify each Bank thereof. Not later than 12:00 Noon, New York
City time, on the Disbursement Date each Bank shall make available to the
Administrative Agent at the Administrative Agent's office set forth in Section
10.7 an amount in immediately available funds equal to the Term Loan to be made
by such Bank. The Administrative Agent shall credit the account of the Borrower
on the books of such office of the Administrative Agent with the aggregate of
the amounts made available to the Administrative Agent by the Banks in
immediately available funds.

         SECTION 2.3.      Repayment. The Term Loan of each Bank shall be
payable in seven consecutive semi-annual installments, each of which shall be in
an amount equal to such Bank's Commitment Percentage multiplied by the amount
set forth below opposite such installment:

<TABLE>
<CAPTION>
Installment             Principal Amount
-----------             ----------------
<S>                     <C>
September __, 2003         $21,428,571
    March __, 2004         $21,428,571
September __, 2004         $21,428,571
    March __, 2005         $21,428,571
September __, 2005         $21,428,571
    March __, 2006         $21,428,571
September __, 2006         $21,428,571
</TABLE>

         SECTION 2.4.      Prepayments.

         (a)     Optional Prepayments.

                                      -21-

<PAGE>

                  (i)     The Borrower may, without penalty or premium but
         subject to the indemnity provisions of Section 2.14, prepay the Term
         Loans upon at least five Business Days' irrevocable notice to the
         Administrative Agent, specifying the date and amount of prepayment.
         Each such optional prepayment shall be made ratably among the Banks
         based on the Commitment Percentages and shall be applied to prepay
         the installments of the Term Loans in inverse order of maturity.

                  (ii)    Upon receipt of a notice of prepayment, the
         Administrative Agent shall promptly notify each Bank thereof. If such
         notice is given, the Borrower shall make such prepayment and the
         payment amount specified in such notice shall be due and payable on
         the date specified therein, together with accrued interest to, and
         any other amounts then due on, each such date on the amount prepaid.
         Prepayments of the Term Loans shall be in a minimum amount equal to
         US$5,000,000 and in multiples of US$1,000,000 in excess thereof, or,
         if less, the aggregate principal amount of the Term Loans then
         outstanding. Amounts prepaid may not be reborrowed.

         (b)      Mandatory Prepayments.

                  (i)     If on any date the Borrower or any its Subsidiaries
         shall receive Net Cash Proceeds from any Asset Sale permitted under
         Section 6.10 or from any issuance of Capital Stock under Section
         6.5(d), then, unless a Reinvestment Notice shall be delivered in
         respect thereof, such Net Cash Proceeds shall be applied in
         accordance with clause (ii) of this Section 2.4(b), on such date
         toward the prepayment of the Term Loans; provided, that,
         notwithstanding the foregoing, (i) aggregate Net Cash Proceeds of
         Asset Sales and issuances of Capital Stock of Subsidiaries not to
         exceed $10,000,000 in any fiscal year of the Borrower or $20,000,000
         prior to the Maturity Date shall be excluded and (ii) on each
         Reinvestment Prepayment Date, an amount equal to the Reinvestment
         Prepayment Amount with respect to the relevant Reinvestment Event
         shall be applied in accordance with clause (ii) of this Section
         2.4(b), toward the prepayment of the Term Loans until such
         outstanding Term Loans are repaid in full.

                  (ii)    Amounts to be applied in connection with prepayments
         made pursuant to clause (i) of this Section 2.4(b) shall be applied
         to the Term Loans.  Prepayments of the Term Loans shall be made
         ratably among the Banks based on the Commitment Percentages and shall
         be applied to installments thereof in the inverse order of maturity.

                  (iii)   Each prepayment of the Term Loans under this
         Section 2.4(b) shall be accompanied by accrued interest to the date
         of such prepayment on the amount prepaid. Any prepayment of the Term
         Loans pursuant to this Section shall be subject to the provisions of
         Section 2.14. Amounts prepaid may not be reborrowed.

         SECTION 2.5.      Interest Rates and Payment Dates.

                                      -22-

<PAGE>

         (a)      The Term Loans comprising each Tranche shall bear interest for
each day during the Interest Period for such Tranche on the unpaid principal
amount thereof at a rate per annum equal to LIBOR determined for such Interest
Period plus the Applicable Margin.

         (b)      If all or a portion of (i) the principal amount of the Term
Loans, (ii) any interest payable on the principal amount of the Term Loans or
(iii) any fee or other amount payable hereunder shall not be paid when due
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall bear interest at a rate per annum equal to LIBOR plus the
Applicable Margin plus 2.0% from the date of such non-payment until paid in full
(both after and before judgment) and shall be payable on demand.

         (c)      Except as otherwise provided in paragraph (b) of this Section
2.5, interest shall be payable in arrears on each Interest Payment Date and on
the Maturity Date.

         SECTION 2.6.      Computation of Interest.

         (a)      Interest in respect of the Term Loans shall be calculated on
the basis of a 360 day year for the actual days elapsed. The Administrative
Agent shall, as soon as practicable, notify the Borrower and the Banks of each
determination of LIBOR; provided, however, that any failure to do so shall not
relieve the Borrower of any liability hereunder.

         (b)      Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Banks in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower or any Bank, deliver
to the Borrower or such Bank, as the case may be, a statement showing the
quotations used by the Administrative Agent in determining any interest rate
pursuant to Section 2.5(a).

         SECTION 2.7.      Inability to Determine Interest Rate. In the event
that the Administrative Agent shall have reasonably determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the interbank eurodollar market, adequate means do
not exist for ascertaining LIBOR applicable pursuant to Section 2.5(a) for any
requested Interest Period, the Administrative Agent shall forthwith give notice
by facsimile of such determination to the Borrower and each Bank at least one
day prior to the last day of the current Interest Period. During the 30 days
following such notice, the Borrower and the Administrative Agent shall negotiate
a mutually satisfactory interest rate to be substituted for the interest rate
calculated in accordance with Section 2.5(a). If a substituted interest rate is
agreed upon, it shall be effective from the first day of such Interest Period.
If the Borrower and the Administrative Agent fail to agree upon a substituted
interest rate, the unpaid principal amount of the Term Loans shall bear interest
from the first day of such Interest Period at the rate per annum equal to the
rate determined by the Required Lenders to be the cost to maintain such unpaid
principal amount outstanding during such period plus the Applicable Margin.

         SECTION 2.8.     Maximum Interest Rate. Anything in this Agreement or
any Notes to the contrary notwithstanding, the interest rate on the Term Loans
shall in no event be in excess of the maximum permitted by applicable law.

                                      -23-

<PAGE>

         SECTION 2.9.      Fees.

         (a)      Administration Fee. The Borrower will pay to the
Administrative Agent, for the sole account of the Administrative Agent, an
administration fee (the "Administration Fees") in the amount and at the times
agreed to by the Administrative Agent and the Borrower in a separate fee letter
(the "Administration Fee Letter").

         (b)      Arrangement Fees. The Borrower will pay to the Joint Lead
Arrangers, for the account of the Joint Lead Arrangers, the arrangement fees
(the "Arrangement Fees") in the amounts and at the times agreed to by the Joint
Lead Arrangers and the Borrower in a separate fee letter (the "Arrangement Fee
Letter").

         (c)      Up-Front Fees. The Borrower will pay to the Administrative
Agent, for the account of the Banks, an up-front fee (collectively, the
"Up-Front Fees") payable in accordance with the terms outlined on page 36 of the
TFM Lenders Meeting Presentation dated July 31, 2002.

         SECTION 2.10.     Pro Rata Treatment and Payments.

         (a)      The Term Loans shall be made by the Banks pro rata according
to their respective Commitments.

         (b)      Except as otherwise provided in Sections 2.11, 2.12, 2.13
and/or 2.14, each payment (including each prepayment) by the Borrower on account
of principal of and interest on the Term Loans shall be made pro rata according
to the respective outstanding principal amounts of the Term Loans held by each
Bank. All payments (including prepayments) to be made by the Borrower on account
of principal, interest, Fees and other amounts due and payable hereunder shall
be made without set-off or counterclaim and (except as otherwise provided in
Sections 2.13, 2.14, 2.15 and 2.16) shall be made prior to 12:00 Noon, New York
City time, on the due date thereof to the Administrative Agent, for the account
of the Banks, at the Administrative Agent's office set forth in Section 10.7,
which shall be maintained in New York, New York, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Banks promptly upon receipt in like funds as received. The Borrower shall have
no liability to any Bank with respect to any amount for which the Borrower has
made payment to the Administrative Agent, for the account of such Bank. If any
payment on a Term Loan becomes due and payable on a day other than a Business
Day, the maturity thereof shall be extended to the next succeeding Business Day
unless the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the immediately
preceding Business Day. In the case of any extension of any payment of principal
pursuant to the preceding sentence, interest thereon shall be payable at the
then applicable rate during such extension.

         (c)      Unless the Administrative Agent shall have been notified in
writing by any Bank prior to a borrowing that such Bank will not make the amount
that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Bank is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a

                                      -24-

<PAGE>

corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Disbursement Date, such Bank shall pay to the
Administrative Agent, on demand, such amount with interest thereon, at a rate
equal to the greater of (i) the Federal Funds Effective Rate and (ii) a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation, for the period until such Bank makes such amount
immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Bank with respect to any amounts owing
under this paragraph shall be conclusive in the absence of manifest error. If
such Bank's share of such borrowing is not made available to the Administrative
Agent by such Bank within three Business Days after such Disbursement Date, the
Administrative Agent shall also be entitled to recover such amount with interest
thereon at the rate per annum applicable to the Term Loans, on demand, from the
Borrower.

         (d)      Unless the Administrative Agent shall have been notified in
writing by the Borrower prior to the date of any payment due to be made by the
Borrower hereunder that the Borrower will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such payment, and the Administrative Agent may, but shall not be required
to, in reliance upon such assumption, make available to the Banks their
respective pro rata shares of a corresponding amount. If such payment is not
made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each Bank to which any amount which was made available pursuant to
the preceding sentence, such amount with interest thereon at the rate per annum
equal to the daily average Federal Funds Effective Rate. Nothing herein shall be
deemed to limit the rights of the Administrative Agent or any Bank against the
Borrower.

         SECTION 2.11.     Taxes.

         (a)      All payments made by the Borrower under this Agreement and any
Notes shall be made free and clear of, and without deduction for or on account
of, any present or future income, stamp, sales or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, imposed, levied, collected,
withheld or assessed by any Governmental Authority of Mexico or any other
jurisdiction from which payment is made or is deemed to be made (excluding the
following "Excluded Taxes": net income taxes or franchise taxes imposed on any
recipient of such payment (each a "Payee") as a result of a present or former
connection between the jurisdiction of the Governmental Authority imposing such
tax and the Payee (other than any such connection arising solely from the Payee
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement) and withholding taxes to the extent imposed
by reason of any Payee or its assignees or participants, if any, failing to make
reasonable commercial efforts to maintain its registration with Hacienda). If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from any
amounts payable to any Payee hereunder, (subject to the right of the Borrower to
contest any such requirement in good faith, so long as proper reserves are
maintained and each Payee hereunder is paid the full amounts payable hereunder
including any gross-up payable) the Borrower shall pay such Non-Excluded Taxes
to the appropriate taxing authority, and the amounts payable to each such Payee
shall be increased by such additional amounts (the "Additional Amounts")
necessary to yield to such

                                      -25-

<PAGE>

Payee (after payment of all Non-Excluded Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement. Whenever any Non-Excluded Tax is payable by the Borrower, as promptly
as possible thereafter, the Borrower shall send to the Administrative Agent, for
the account of such Payee, a certified copy by a Responsible Officer of the
Borrower of a stamped filed receipt showing payment thereof. If the Borrower
fails to pay any Non-Excluded Taxes when due to the appropriate taxing authority
or fails to remit to the Administrative Agent the required receipts or other
required documentary evidence, the Borrower shall indemnify the affected Payees
for any incremental taxes, interest or penalties that may become payable by any
such Payee as a result of any such failure. This indemnity and agreement shall
survive termination of the Agreement and payment of the Term Loans.

         (b)     Each Payee shall, from time to time at the request of the
Borrower or the Administrative Agent, furnish to the Borrower or the
Administrative Agent, as the case may be, such documentation as may be required
to establish any available exemption from, or reduction in the amount of,
otherwise applicable Non-Excluded Taxes. The Borrower and the Administrative
Agent shall be entitled to rely upon the accuracy of any such documentation
furnished to it by any Payee and shall have no obligation to indemnify such
Payee for any incremental taxes, interest or penalties that may become payable
by such Payee solely as a result of any inaccuracy contained therein or the
Payee's failure to furnish such documentation.

         SECTION 2.12.     Illegality. Notwithstanding any other provisions
herein, if any Requirement of Law or any change therein or in the interpretation
or application thereof shall make it unlawful for any Bank to make or maintain a
Term Loan as contemplated by this Agreement, then such Bank may give notice
thereof to each of the Borrower and the Administrative Agent and, upon the
giving of such notice (a) the Commitment of such Bank hereunder to make a Term
Loan shall forthwith be canceled and (b) such Bank's Term Loans then outstanding
shall bear interest, from the last day of the then current Interest Period or
earlier if required by law, at the Base Rate plus the Applicable Margin then in
effect less 1.0% per annum. If any such conversion of Term Loans is made on a
day which is not the last day of the Interest Period therefor, the Borrower
shall pay to such Bank such amounts, if any, as may be required pursuant to
Section 2.14. For purposes of this Section 2.12, "Base Rate" shall mean, for any
day, the higher of (i) the rate of interest publicly announced by JPMCB from
time to time as its prime rate in New York City, the prime rate to change as and
when such designated rate changes or (ii) the effective Federal Funds Effective
Rate plus one-half of one percent (1/2 of 1.0%), in each case as in effect for
such day.

         SECTION 2.13.     Requirements of Law.

         (a)     If, after the Effective Date, and as a result of the adoption
of any law, regulation, treaty or official directive or request (whether or not
having the force of law) or any change therein or any introduction thereof
(which such change or introduction is publicly announced through official
governmental, regulatory or other customary means after the Effective Date) or
compliance therewith by the Borrower, the Administrative Agent or any Bank (or
any corporation controlling such Bank) including those relating to taxation,
reserves, special deposit, cash ratio, liquidity, capital adequacy or
Eurocurrency Liabilities or other requirement or

                                      -26-

<PAGE>

any other form of banking or monetary requirements or controls, any of the
following shall occur:

                  (i)      the cost to any Bank of maintaining its Term Loan is
         increased by an amount determined by such Bank to be material; or

                  (ii)     any amount receivable by any Bank is reduced by an
         amount determined by such Bank to be material as a result of
         maintaining its Term Loan; or

                  (iii)    the rate of return on such Bank's (or its controlling
         corporation's) capital is reduced as a consequence of its obligations
         hereunder below that which such Bank could have achieved but for such
         adoption, change or introduction (taking into consideration such
         Bank's or such corporation's policies with respect to capital
         adequacy) by an amount deemed by such Bank to be material;

in the case of each of clauses (i), (ii) and (iii) other than any increase in or
incurrence of cost, reduction in yield or other return or additional payment
resulting from Excluded Taxes, then and in each such case:

              (A) such Bank or the Administrative Agent on its own behalf
     (each of the foregoing, an "Affected Bank") shall notify the Borrower
     through the Administrative Agent in writing of such event promptly upon
     its becoming aware of the event entitling it to make a claim; and

              (B) upon demand from time to time by such Affected Bank through
     the Administrative Agent, the Borrower shall pay to the Administrative
     Agent for the account of such Affected Bank such amount as shall
     compensate such Affected Bank for such increased cost, reduced amount
     receivable or reduction in rate of return. The certificate of such
     Affected Bank specifying the amount of such compensation shall be
     conclusive save in the case of manifest error.

         (b)      If an Affected Bank shall request compensation under this
Section 2.13, such Bank shall furnish to the Borrower a statement setting forth
the basis for requesting such compensation.

         (c)      The covenants and agreements set forth in this Section 2.13
shall survive the termination of this Agreement and the payment of the
outstanding Term Loans. Failure or delay on the part of any Bank to demand
compensation pursuant to this Section 2.13 shall not constitute a waiver of such
Bank's right to demand compensation; provided that the Borrower shall not be
required to compensate a Bank, as applicable, pursuant to this Section 2.13 for
any increased costs or reductions incurred more than 180 days prior to the date
that such Bank notifies the Borrower of the event giving rise to such increased
costs or reductions and of such Bank's intention to claim compensation therefor;
and provided further that, if the event giving rise to such increased costs or
reduction is retroactive, then the 180 day period referred to above shall be
extended to include the period of retroactive effect thereof.

                                      -27-

<PAGE>

         SECTION 2.14.     Funding Indemnity. The Borrower agrees to indemnify
each Bank and to hold such Bank harmless from any actual loss or expense
(excluding loss of profit) which such Bank may sustain or incur as a consequence
of (a) default by the Borrower in payment when due (by acceleration or
otherwise) of the principal amount of or interest on the Term Loan of such Bank,
(b) default by the Borrower in making a borrowing of Term Loans or any
prepayment after the Borrower has given a notice in accordance with Section 2.2
or 2.4(a), respectively, and (c) the making by the Borrower of a prepayment of
the Term Loans on a day which is not the last day of the Interest Period with
respect thereto (whether or not the Administrative Agent or such Bank has
previously consented to such prepayment), including any such loss or expense
arising from interest or fees payable by such Bank to lenders of funds obtained
by it in order to maintain its Term Loan hereunder as set forth in a certificate
of such Bank delivered to the Borrower through the Administrative Agent. This
covenant shall survive termination of this Agreement and payment of the Term
Loans.

         SECTION 2.15.     Sharing of Payments, Etc.

         (a)     If, other than as expressly provided elsewhere herein, any
Bank shall obtain on account of the Obligations owing to it hereunder or in
respect of its Term Loan any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) in excess of its Commitment
Percentage of payments on account of the Obligations obtained by all the Banks,
such Bank shall forthwith (i) notify the Administrative Agent of such fact, and
(ii) purchase from the other Banks such participations in such amounts made by
them as shall be necessary to cause such purchasing Bank to share the excess
payment ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from the purchasing Bank, such
purchase shall to that extent be rescinded and each other Bank shall repay to
the purchasing Bank the purchase price paid therefor, together with an amount
equal to such paying Bank's Commitment Percentage (determined for this purpose
according to the proportion of (A) the amount of such paying Bank's required
repayment to (B) the total amount so recovered from the purchasing Bank) of any
interest or other amount paid or payable by the purchasing Bank in respect of
the total amount so recovered. The Administrative Agent will keep records (which
shall be conclusive and binding in the absence of manifest error) of
participations purchased pursuant to this Section 2.15 and will in each case
notify the Banks and the Borrower following any such purchases.

         (b)     The Borrower agrees that any Bank so purchasing a participation
from another Bank pursuant to this Section 2.15 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 10.12) with respect to such participation as
fully as if such Bank were the direct creditor of the Borrower in the amount of
such participation.

         SECTION 2.16.     Change of Lending Office.

         (a)     Each Bank agrees that, upon the occurrence of any event giving
rise to the operation of Section 2.11, 2.12 or 2.13(a) as to it, it will use its
reasonable best efforts to avoid or minimize the consequences of such event;
provided, however, that such action shall not, in the judgment of such Bank, as
the case may be, be illegal or economically or otherwise disadvantageous to it.
If such Bank is entitled to compensation for the events specified under

                                      -28-

<PAGE>

Section 2.11 or 2.13(a), or is required to make a prepayment as a
result of the operation of Section 2.12, it shall endeavor for a period of 30
days to designate a different office for any Obligation affected by such event
if such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole opinion of such Bank, result in any
economic, legal or regulatory or other disadvantage to such Bank or any of its
affiliates.

         SECTION 2.17.     Replacement of Banks. The Borrower shall be permitted
to replace any Bank that (a) requests reimbursement for amounts owing pursuant
to Section 2.11 or 2.13(a), (b) is required to make a prepayment as a result of
the operation of Section 2.12 or (c) defaults in its obligation to make its Term
Loan hereunder, with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Event of
Default shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Bank shall have taken no action under
Section 2.16 so as to eliminate the continued need for payment of amounts owing
pursuant to Section 2.11 or 2.13(a) or the operation of Section 2.12, (iv) the
replacement financial institution shall purchase, at par, the Term Loan and
other amounts owing to such replaced Bank on or prior to the date of
replacement, (v) the Borrower shall be liable to such replaced Bank under
Section 2.12 if the Term Loan owing to such replaced Bank shall be purchased
other than on the last day of an Interest Period relating thereto, (vi) the
replacement financial institution, if not already a Bank, shall be reasonably
satisfactory to the Administrative Agent, (vii) the replaced Bank shall be
obligated to make such replacement in accordance with the provisions of Section
10.10 (provided that the Borrower shall be obligated to pay the registration and
processing fee referred to therein), (viii) until such time as such replacement
shall be consummated, the Borrower shall pay all additional amounts (if any)
required pursuant to Section 2.11 or 2.13(a), as the case may be, and (ix) any
such replacement shall not be deemed to be a waiver of any rights that the
Borrower, the Administrative Agent or any other Bank shall have against the
replaced Bank.

                                  ARTICLE III
                             CONDITIONS PRECEDENT

         SECTION 3.1.      Conditions to Effective Date. This Agreement shall
become effective on the date that the following conditions and the conditions
precedent set forth in Section 3.2 have been fulfilled:

         (a)     Agreement. The Administrative Agent shall have received
counterparts of this Agreement, duly executed by each party hereto.

         (b)     Notes. All the Notes shall have been duly executed and
delivered by the Borrower to the Administrative Agent.

         (c)     Opinion of Borrower's Counsel. The Administrative Agent shall
have received an opinion, dated the Effective Date, of Haynes and Boone LLP and
Haynes and Boone, S.C., special U.S. counsel and special Mexican counsel,
respectively, to the Borrower, in substantially the form of Exhibit B. The
opinion of Borrower's counsel shall be addressed to the Administrative Agent,
the Documentation Agent, the Joint Lead Arrangers and the Banks.

                                      -29-

<PAGE>

         (d)     Opinion of Counsel to the Administrative Agent. The
Administrative Agent shall have received the opinion of Mexican counsel to the
Administrative Agent, dated the Effective Date and in form and substance
satisfactory to the Administrative Agent.

         (e)     Governmental Approvals. All necessary orders, consents,
approvals (including authorizations from any central bank), licenses,
permissions, registrations and validations of, or notices to or filings with,
and exemptions by, any Mexican Governmental Authority required for the
execution, delivery, performance or carrying out by the Borrower of the
provisions of this Agreement and the Notes for the validity or enforceability of
the obligations incurred hereunder or thereunder shall have been obtained and
shall be in full force and effect and copies thereof certified by appropriate
officers of the Borrower to such effect shall have been delivered to the
Administrative Agent.

         (f)     Organizational Documents. There shall have been delivered to
the Administrative Agent the following organizational documents: (i) a duly
certified copy by Mexican Public Notary, in Spanish, of the estatutos of the
Borrower as adopted as of the Effective Date; (ii) an incumbency certificate
designating the officers of the Borrower (together with their specimen
signatures) authorized to execute any document in connection with the
transactions contemplated by this Agreement; and (iii) copies authorized by
Mexican Public Notary of resolutions of the Board of Directors of the Borrower
certified by the Secretary of the Board of Directors of the Borrower or a
Responsible Officer of the Borrower and dated as of the Effective Date,
authorizing the execution, delivery and performance of this Agreement, each Fee
Letter and the Notes and the designation of CT Corporation as the Borrower's
agent for service of process. Such certificates shall state that the resolutions
set forth therein have not been amended, modified, revoked or rescinded as of
the date of such certificates.

         (g)     Change of Conditions. No introduction of or any change in the
interpretation of any law or regulation that would make it unlawful or
impracticable for the Banks or the Administrative Agent to undertake the
transactions contemplated by this Agreement shall have occurred and be
continuing.

         (h)     Payment of Fees and Expenses. The Borrower shall have paid: (A)
to the Administrative Agent, the Administration Fees due on the Date of
Issuance; (B) to the Joint Lead Arrangers, the Arrangement Fees due on the Date
of Issuance; and (C) to the Administrative Agent for the account of the Banks,
the Up-Front Fees.

         (i)     Agent for Service of Process. The Administrative Agent shall
have received a certified copy of the applicable notarial deed by which the
Borrower has appointed and granted a power of attorney to the agent for service
of process in New York, New York pursuant to Section 10.13, and that the agent
has accepted such appointment.

         (j)     Governmental Concessions The Administrative Agent shall have
received copies of the Concession Title together with a certificate of the
Secretary of the Board of Directors of the Borrower or any Responsible Officer
of the Borrower stating that such Concession Title is in full force and effect
and further that the Borrower is in material compliance with all terms and
conditions applicable thereunder or pursuant to applicable law.

                                      -30-

<PAGE>

         (k)     Financial Statements. The Administrative Agent shall have
received (i) audited consolidated financial statements of the Borrower for the
1999, 2000 and 2001 fiscal years and (ii) unaudited interim consolidated
financial statements of the Borrower for each fiscal quarter ended after the
date of the latest applicable financial statements delivered pursuant to clause
(i) of this paragraph through June 30, 2002 and such financial statements shall
be in form and substance satisfactory to the Administrative Agent.

         (l)     Projections. The Administrative Agent shall have received
financial projections of the Borrower through fiscal year 2006, in form and
substance satisfactory to the Administrative Agent.

         (m)     Termination of Existing CP Facility. The Administrative Agent
shall have received a termination letter, in form and substance satisfactory to
the Administrative Agent, dated the Effective Date, confirming that all
obligations of the Borrower under the Existing CP Facility shall have been
satisfied in full or will be satisfied concurrently with the effectiveness of
this Agreement and that the Existing CP Facility shall have been terminated or
will be terminated concurrently with the effectiveness of this Agreement.

         (n)     CP Facility. The conditions set forth in Article V of the CP
Facility shall have been satisfied.

         In connection with this Section 3.1, the Borrower shall deliver to the
Administrative Agent sufficient copies (executed originals and certified English
translations where applicable) of all documents for each of the Banks.

         SECTION 3.2.      Conditions to Term Loan.  The agreement of each Bank
to make a Term Loan on any date is subject to the satisfaction of the following
conditions precedent:

         (a)      Representations and Warranties. The representations and
warranties of the Borrower contained herein (other than any such representation
or warranty which, by its term, speaks as of a particular date) are true and
correct in all material respects on and as of the date of the making of such
Term Loan by the Banks with the same effect as if made on and as of such date.

         (b)     No Event of Default. No Default or Event of Default shall have
occurred and be continuing on such date or shall come into existence as a result
thereof or the use of the proceeds thereof.

The borrowing of the Term Loans by the Borrower hereunder shall constitute a
representation and warranty by the Borrower as of the date of such borrowing
that the conditions contained in this Section 3.2 have been satisfied.

                                      -31-

<PAGE>

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

         In order to induce the Banks, the Joint Lead Arrangers, the Arrangers,
the Documentation Agent and the Administrative Agent to enter into this
Agreement and to induce the Banks to make the Term Loans provided for herein,
the Borrower makes the following representations and warranties to the Banks,
the Joint Lead Arrangers, the Arrangers, the Documentation Agent and the
Administrative Agent, all of which shall survive the execution and delivery of
this Agreement:

         SECTION 4.1.      Status and Licensing. The Borrower is a limited
liability variable capital corporation (sociedad anonima de capital variable)
duly organized and validly existing under the laws of Mexico. The Borrower has
the power and authority to own its property and to transact the business in
which it is engaged or presently proposes to engage and is duly qualified or
licensed as a foreign corporation in each jurisdiction in which such
qualification is required, unless failure so to qualify could not reasonably be
expected to have a Material Adverse Effect.

         SECTION 4.2.      Corporate Power and Authority; Enforceable
Obligations. (a) The Borrower has the corporate power to execute, deliver and
perform the terms and provisions of this Agreement, the Notes and the Fee
Letters, and has taken all necessary corporate action required by the estatutos
of the Borrower to authorize the execution, delivery and performance of this
Agreement, the Notes and the Fee Letters.

         (b)     This Agreement, the Notes and the Fee Letters have been
duly authorized, executed and delivered by the Borrower.

         (c)     Each of this Agreement and the Fee Letters constitutes,and each
Note when executed by the Borrower and delivered for value received will
constitute, legal, valid and binding obligations of the Borrower enforceable in
accordance with their respective terms except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, concurso
mercantil, insolvency, reorganization, moratorium or other similar laws
generally affecting creditors' rights and by equitable principles (regardless of
whether enforcement is sought in equity or at law).

         SECTION 4.3.      Compliance with Law and Other Instruments.  Neither
the execution, delivery or performance of this Agreement or the Notes in
accordance with their respective terms, nor the consummation of the transactions
herein or therein contemplated, nor compliance with the terms and provisions
hereof or thereof, will contravene the charter or bylaws (estatutos) (or other
equivalent organizational documents) of the Borrower or contravene any
Requirement of Law to which the Borrower is subject or any judgment, decree,
order or permit applicable to the Borrower, or will conflict with or will result
in any breach of, any of the terms, covenants, conditions or provisions of, or
constitute a default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien upon any of the property or assets of
the Borrower pursuant to the terms of any indenture, mortgage, deed of trust,
agreement or other instrument (other than those permitted or required by this
Agreement and the Notes, including, without limitation, Permitted Liens) to
which the Borrower is a party or

                                      -32-

<PAGE>

bound or to which it may be subject or violate any provision of the estatutos of
the Borrower, except in each case where such conflict, breach, default or
violation would not have a Material Adverse Effect.

         SECTION 4.4.      Litigation and Environmental Matters. There are no
actions, suits or proceedings pending or, to the best of the Borrower's
knowledge, threatened against or affecting the Borrower before any court,
tribunal or other Governmental Authority: (a) with respect to this Agreement,
the Notes or the transactions contemplated hereby or thereby or (b) which
individually or in the aggregate could be reasonably expected to have a
Material Adverse Effect. Except with respect to any matters that, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, the Borrower (i) has not failed to comply with any Environmental
Law or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has not become subject to any
Environmental Liability, (iii) has not received notice of any claim with respect
to any Environmental Liability or (iv) knows of no basis for any Environmental
Liability. The Borrower is not in default with respect to any applicable
statute, rule, writ, injunction, decree, order or regulation of any Governmental
Authority having jurisdiction over the Borrower which could reasonably be
expected to have a Material Adverse Effect.

         SECTION 4.5.      Governmental Approvals. No order, permission,
consent, approval, license, authorization, registration or validation of, or
notice to or filing with, or exemption by, any Governmental Authority is
required by the Borrower to authorize, or is required in connection with, the
execution, delivery and performance by the Borrower of this Agreement and the
Notes or the taking of any action by the Borrower hereby or thereby
contemplated, or, if any of the foregoing are required, they have been obtained
and are in full force and effect.

         SECTION 4.6.      Financial Information.

         (a)     The audited financial statements of the Borrower dated
December 31, 1999, 2000 and 2001, and unaudited financial statements as of June
30, 2002 (the "Financial Statements"), including in each case the related
schedules and notes, fairly present the financial condition of the Borrower as
of the dates of such statements and the results of their operations for the
periods therein stated and have been prepared in accordance IAS, consistently
applied throughout the periods involved (unless and to the extent otherwise
stated therein).

         (b)     Except as fully disclosed in the Financial Statements,
there are no liabilities or obligations with respect to the Borrower and its
Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due) and the Borrower knows of no basis for the
assertion against it or its Subsidiaries of any liability or obligation of any
nature that is not fully disclosed in the Financial Statements which, in either
case, either individually or in the aggregate, would be reasonably expected to
have a Material Adverse Effect.

         (c)     Since December 31, 2001, there has been no development or event
which has had or could reasonably be expected to have a Material Adverse Effect.

                                      -33-

<PAGE>

         SECTION 4.7.      Taxes, Assessments and Fees. The Borrower has paid
all taxes due except such taxes as are being contested in good faith for which
adequate (in the good faith judgment of the Borrower) reserves have been made
(in accordance with IAS) or such taxes the failure of which to pay could not
reasonably be expected to have a Material Adverse Effect.

         SECTION 4.8.      Investment Company Act. The Borrower is not an
"investment company" required to be registered under the Investment Company Act
of 1940, as amended.

         SECTION 4.9.      Accuracy of Information. All written
information supplied by the Borrower to the Administrative Agent, the
Documentation Agent, the Joint Lead Arrangers, the Arrangers and the Banks
relating to the Borrower, viewed in the aggregate, was true and accurate in all
material respects as of the date supplied, and did not as of such date, and does
not, in each case viewed in the aggregate, omit to state any material
information necessary to make the information therein contained, in light of the
circumstances under which such information was supplied, not misleading.

         SECTION 4.10.     Absence of Default. No Default or Event of Default
has occurred and is continuing.

         SECTION 4.11.     Obligations Pari Passu; Recourse; Liens. The
Obligations of the Borrower under this Agreement and the Notes rank at least
pari passu in right of payment with all its other senior unsecured Indebtedness,
except for obligations accorded preference by mandatory provisions of law. There
is no Lien upon or with respect to any of the present or future properties or
Indebtedness of the Borrower or its Subsidiaries other than liens permitted or
required by this Agreement or the Notes, including, without limitation,
Permitted Liens.

         SECTION 4.12.     Withholding Tax. As of the Effective Date,
there is no tax, levy, impost, deduction, charge or withholding imposed, levied
or made by or in Mexico or any political subdivision or taxing authority thereof
or therein either (i) on or by virtue of the execution or delivery of this
Agreement or the Notes or the Fee Letters or (ii) on any payment to be made by
the Borrower pursuant to this Agreement or the Notes or any of the Fee Letters
to any Person, except that payments of interest under this Agreement and fees
payable hereunder and under any Fee Letter will be subject to a Mexican
withholding tax at a rate of 4.9% so long as the payee is a commercial bank or
other financial institution registered with Hacienda and, if applicable, the
Borrower complies with general rules issued by Hacienda. As of the Effective
Date, the Borrower is permitted under applicable law, to make all payments
pursuant to this Agreement, the Notes or the Fee Letters free and clear of all
taxes, levies, imposts, deductions, charges or withholdings imposed, levied or
made by or in Mexico or any political subdivision or taxing authority thereof,
as provided in this Agreement or in the Notes, without any liability to be borne
by the payee in connection with such Mexican withholding tax to the extent that
the Borrower has complied with its obligations in Section 2.11 of this Agreement
to pay to the appropriate Mexican authorities applicable withholding taxes
required to be paid by the Borrower.

         SECTION 4.13.     Proper Form; No Filing. This Agreement is (or, in the
case of any Note, will be, upon the issuance thereof in accordance herewith) in
proper legal form for the enforcement thereof in Mexico against the Borrower;
provided, however, that if any legal

                                      -34-

<PAGE>

proceedings are brought in a court of Mexico for the enforcement against the
Borrower, of this Agreement and the Notes, a Spanish translation of such
documents prepared by a translator approved by the Mexican court would have to
be approved by such court after the Borrower has been given the opportunity to
be heard with respect to the accuracy of the translation, and proceedings would
thereafter be based on the translated documents. To ensure the legality,
validity, enforceability or admissibility in evidence of this Agreement and the
Notes in Mexico it is not necessary that this Agreement or any other document be
filed or recorded with any Governmental Authority in Mexico or be notarized, or
that any stamp or similar tax be paid on or in respect of this Agreement or any
of the Notes.

         SECTION 4.14.     Choice of Law. In any action or proceeding involving
the Borrower arising out of or relating to this Agreement in any court of
Mexico, a Bank, the Joint Lead Arrangers, the Arrangers, the Documentation Agent
and the Administrative Agent would be entitled to the recognition and
effectiveness of the choice of law provisions of Section 10.5.

         SECTION 4.15.     Immunity. The Borrower is subject to suit in Mexico
and neither it nor its property has any right of immunity, on the grounds of
sovereignty or otherwise, from any legal action, suit or proceeding, set-off or
counterclaim, the jurisdiction of any competent court and service of process,
attachment or execution in Mexico with respect to its obligations, liabilities,
or any other matter under or arising out of or in connection with this Agreement
or any Notes, and to the extent that the Borrower or its property may have or
may hereafter become entitled to any such right of immunity it has effectively
waived such right under Section 10.16; provided, that the Concession Title may
not be transferred to any Person without the prior consent of Mexico.  The
waiver by the Borrower described in the immediately preceding sentence is a
legal, valid and binding obligation thereof.  The foregoing waiver is intended
to be effective to the fullest extent now or hereafter permitted by the
applicable law of any jurisdiction in which any suit, action or proceeding with
respect to this Agreement may be commenced. The performance of this Agreement
and the Notes by the Borrower constitutes private and commercial acts rather
than governmental or public acts.

         SECTION 4.16.     Status of Concession. The Concession Title is in
full force and effect and no investigation or proceeding seeking the termination
or revocation of the Concession Title has been initiated or attempted.

         SECTION 4.17.     Properties. (a) The Borrower has good title to, or
valid leasehold interests in, all its real and personal property material to its
business, except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes.

         (b)     The Borrower owns, or is licensed to use, all trademarks,
tradenames, copyrights, patents and other intellectual property material to its
business, and the use thereof by the Borrower does not infringe upon the rights
of any other Person, except for any such infringements that, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

         SECTION 4.18.     Subsidiaries. The Subsidiaries listed on Schedule
4.18 hereto constitute the only Subsidiaries of the Borrower as at the date
hereof.

                                      -35-

<PAGE>

         SECTION 4.19.     Federal Regulations. No part of the proceeds of any
Term Loan will be used for "buying" or "carrying" any "margin stock" within the
respective meanings of each of the quoted terms under Regulation U as now and
from time to time hereafter in effect or for any purpose that violates the
provisions of the Regulations of the Board.  If requested by any Bank or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Bank a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in
Regulation U.

         SECTION 4.20.     Labor Matters. Except as, in the aggregate, could
not reasonably be expected to have a Material Adverse Effect: (a) there are no
strikes or other labor disputes against the Borrower pending or, to the
knowledge of the Borrower, threatened; (b) hours worked by and payment made to
employees of the Borrower have not been in violation of any applicable
Requirement of Law dealing with such matters; and (c) all payments due from the
Borrower on account of employee health and welfare insurance have been paid or
accrued as a liability on the financial statements of the Borrower.

                                    ARTICLE V

                              AFFIRMATIVE COVENANTS

         The Borrower covenants and agrees that for so long as this Agreement
is in effect and until all of the Obligations are paid in full, the Borrower
will:

         SECTION 5.1.      Senior Obligations. Ensure that its obligations under
this Agreement and the Notes shall at all times rank at least pari passu with
all its other present and future direct, indirect, unsecured and unsubordinated
Indebtedness, except for obligations accorded preference by mandatory provisions
of law.

         SECTION 5.2.      Financial Statements.

         (a)     Deliver to the Administrative Agent as soon as available, and
in any case within 120 days of the end of each fiscal year of the Borrower,
originals and English translations of the consolidated annual financial
statements of the Borrower and its Subsidiaries audited and reported on in
accordance with IAS, consistently applied (except as otherwise discussed in the
notes to such financial statements) by independent auditors of recognized
standing, which financial statements shall present fairly in accordance with IAS
the financial condition of the Borrower as at the end of the relevant fiscal
year and the results of the operations of the Borrower for such fiscal year;

         (b)     Deliver to the Administrative Agent as soon as available, and
in any case within 45 days of the end of each fiscal quarter, originals and
English translations of the unaudited consolidated financial statements of the
Borrower and its Subsidiaries in respect of such fiscal quarter prepared in
accordance with IAS, consistently applied (except as otherwise discussed in the
notes to such financial statements), which financial statements shall present
fairly in accordance with IAS, the financial condition of the Borrower as at the
end of the relevant fiscal quarter of each fiscal year and the results of the
operations of the Borrower for such fiscal quarter;

                                      -36-

<PAGE>

         (c)     Concurrently, with the delivery of the financial statements
pursuant to paragraphs (a) and (b) above, deliver to the Administrative Agent a
certificate of a Responsible Officer of the Borrower stating that (i) to the
best of such Responsible Officer's knowledge, the Borrower during such period
has observed or performed all of its covenants and other agreements, and
satisfied every condition contained in this Agreement and other related
agreements and that such Responsible Officer has obtained no knowledge of any
Default or Event of Default except as specified in such certificate and (ii) a
compliance certificate by the Borrower containing all information and
calculations necessary for determining compliance by the Borrower with the
covenants contained in Section 6.1;

         (d)     Deliver to the Administrative Agent sufficient copies of the
statements referred to in paragraphs (a) and (b) for all the Banks and other
parties to this Agreement; and

         (e)     Furnish to the Administrative Agent copies of such other
financial reports filed by the Borrower with any Governmental Authority or with
any Mexican or other securities exchange and which are publicly available which
the Administrative Agent (or any Bank through the Administrative Agent) may from
time to time reasonably request; provided that the information will be furnished
in Spanish unless information is provided publicly in English.

         SECTION 5.3.      Notice of Default; Litigation and Material Adverse
Effect.  Furnish to the Administrative Agent, not later than five Business Days
after a Responsible Officer of the Borrower obtains knowledge thereof (and the
Administrative Agent will notify each Bank thereof):

         (a)      written notice of any Default or Event of Default, signed
by a Responsible Officer of the Borrower, describing such Default or Event of
Default and the steps that the Borrower proposes to take in connection
therewith;

         (b)     written notice of any litigation, action or proceeding pending
or threatened in writing against the Borrower before any Governmental Authority,
which, individually or in the aggregate, could be reasonably expected to have a
Material Adverse Effect; and

         (c)     a certificate of a Responsible Officer of the Borrower setting
forth details of any event that may have a Material Adverse Effect on the
Borrower and the actions the Borrower proposes to take with respect thereto.

         SECTION 5.4.      Use of Proceeds. Use the proceeds of Term Loans
solely for general working capital purposes which shall include, without
limitation, the repayment of obligations of the Borrower under the Existing CP
Facility.

         SECTION 5.5.      Conduct of Business and Maintenance of Existence.

         (a)     Continue to engage in business of the same general type as now
conducted by it or authorized by its estatutos or by the Concession Title and
preserve, renew and keep in full force and effect its corporate existence,
subject to any merger or consolidation permitted under Section 6.11 and (b) take
all reasonable action to maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business (including, without
limitation, the Concession Title) and comply with all contractual obligations
(including the terms

                                      -37-

<PAGE>

of such Concession Title) binding on it or its property except for failure to
maintain any rights, privileges or franchises or to comply with contractual
obligations which, in the aggregate, would not have a Material Adverse Effect.

         SECTION 5.6.      Maintenance of Government Approvals. Maintain in full
force and effect all material governmental approvals (including any exchange
control approvals), consents, licenses and authorizations which may be necessary
or appropriate under any applicable law or regulation for the conduct of its
business, for the execution, delivery and performance of this Agreement and the
Notes by the Borrower and for the validity or enforceability against it hereof
and thereof and take all necessary governmental and administrative action in
Mexico to make all payments to be made by it hereunder and thereunder.  The
Borrower will file all applications necessary for, and shall use its best
efforts to obtain, any additional authorization as soon as possible after
determination that such authorization or approval is required for the Borrower
to perform its obligations hereunder or under this Agreement and the Notes,
including, but not limited to, any filings necessary to obtain payment in US
Dollars in respect of this Agreement, the Notes or the Term Loans.

         SECTION 5.7.      Compliance with Laws and Other Instruments.
Comply in all material respects with (a) all applicable Requirements of Law
(including, without limitation, all applicable Mexican railroad regulations
(including the filing of documents, the fulfillment of investment requirements
and the performance of services as required in the Concession Title and the
applicable laws and regulations)), and (b) any of the terms, covenants,
conditions or provisions of any indenture, mortgage, deed of trust, agreement or
other instrument to which the Borrower is a party or bound or to which it may be
subject, except in each case where the necessity of compliance therewith is
contested in good faith by appropriate proceedings or where failure to comply
could not reasonably be expected to have a Material Adverse Effect.

         SECTION 5.8.      Maintenance of Properties; Insurance. The Borrower
will, and will cause each of its Subsidiaries to, (a) keep and maintain all
property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) maintain insurance with
financially sound, responsible and reputable insurance companies in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning and/or operating properties similar to those owned and/or
operated by the Borrower or such Subsidiary, as the case may be, in the same
general areas in which the Borrower or such Subsidiary owns and/or operates its
properties.

         SECTION 5.9.      Maintenance of Books and Records and Inspection
Rights. The Borrower will, and will cause each of its Subsidiaries to, maintain
books, accounts and records in accordance with IAS. The Borrower will, and will
cause each of its Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Bank, upon reasonable prior written notice, to visit
and inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all during business hours of the Borrower or such
Subsidiary and as often as reasonably requested.

         SECTION 5.10.     Payment of Obligations. The Borrower will, and will
cause each of its Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, could

                                      -38-

<PAGE>

result in a Material Adverse Effect before the same shall become delinquent or
in default, except where (a) the validity or amount thereof is being contested
in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary
has set aside on its books adequate reserves with respect thereto in accordance
with IAS and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect.

         SECTION 5.11.     Environmental Laws. (a) Comply in all material
respects with, and ensure compliance in all material respects by all tenants and
subtenants, if any, with, all applicable Environmental Laws, and obtain and
comply in all material respects with and maintain, and ensure that all tenants
and subtenants obtain and comply in all material respects with and maintain, any
and all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, and (b) conduct and complete all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material respects
with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws, except in each case where the necessity of compliance
therewith is contested in good faith by appropriate proceedings or where failure
to comply could not reasonably be expected to have a Material Adverse Effect.

                                   ARTICLE VI

                               NEGATIVE COVENANTS

         The Borrower covenants and agrees that for so long as this Agreement
is in effect and until all of the Obligations are paid in full, the Borrower
shall not, and shall not permit any of its Subsidiaries to:

         SECTION 6.1.      Financial Covenants.

         (a)     Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio as of the last day of any fiscal quarter, to be less
than the ratio set forth below corresponding to such fiscal quarter, for the
period of four consecutive fiscal quarters ending on such date:

<TABLE>
<CAPTION>
----------------------------------
      Period               Ratio
----------------------------------
<S>                        <C>
07/01/02 - 12/31/02        2.00x
----------------------------------
01/01/03 - 09/30/03        2.25x
----------------------------------
10/01/03 - 09/30/04        2.50x
----------------------------------
10/01/04 - 09/30/05        3.00x
----------------------------------
10/01/05 - 09/30/06        3.25x
----------------------------------
</TABLE>

         (b)     Consolidated Fixed Charge Coverage Ratio. Permit the
Consolidated Fixed Charge Coverage Ratio as of the last day of any fiscal
quarter, to be less than the ratio set forth below corresponding to such fiscal
quarter, for the period of four consecutive fiscal quarters ending on such date:

                                      -39-

<PAGE>

<TABLE>
<CAPTION>
-----------------------------------
       Period               Ratio
-----------------------------------
<S>                         <C>
07/01/02 - 09/30/0          0.85x
-----------------------------------
10/01/03 - 09/30/06         1.00x
-----------------------------------
</TABLE>

         (c)     Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio as of the last day of any fiscal quarter, to be greater than the ratio set
forth below corresponding to such fiscal quarter, for the period of four
consecutive fiscal quarters ending on such date:

<TABLE>
<CAPTION>
-------------------------------
       Period           Ratio
-------------------------------
<S>                     <C>
07/01/02 - 12/31/02     4.50x
-------------------------------
01/01/03 - 09/30/03     4.00x
-------------------------------
10/01/03 - 09/30/04     3.50x
-------------------------------
10/01/04 - 09/30/05     3.00x
-------------------------------
10/01/05 - 09/30/06     2.75x
-------------------------------
</TABLE>

         SECTION 6.2.      Margin Regulations. Use any part of the proceeds
from the Term Loans for any purpose which would result in any violation of
Regulations T, U or X of the Board of Governors of the Federal Reserve System or
to extend credit to others for any such purpose.  The Borrower will not engage
in, or maintain as one of its important activities, the business of extending
credit for the purpose of purchasing or carrying any margin stock.

         SECTION 6.3.     Limitation on Restricted Payments

         (a) (i) Declare or pay any dividend or make any distribution on or with
respect to the Capital Stock of the Borrower or any of its Subsidiaries (other
than (x) dividends or distributions payable solely in shares of the Borrower's
or such Subsidiary's Capital Stock (other than Disqualified Stock) or in
options, warrants or other rights to acquire shares of such Capital Stock and
(y) pro rata dividends or distributions on Common Stock of Subsidiaries held by
minority stockholders, provided that such dividends do not in the aggregate
exceed the minority stockholders' pro rata share of such Subsidiaries' net
income from the first day of the fiscal quarter beginning immediately following
the Effective Date) held by Persons other than the Borrower or any of its
Subsidiaries;

                 (ii)    purchase, redeem, retire or otherwise acquire for value
         any shares of Capital Stock of (x) the Borrower (including options,
         warrants or other rights to acquire such shares of Capital Stock) held
         by any Person or (y) a Subsidiary of the Borrower (including options,
         warrants or other rights to acquire such shares of Capital Stock) held
         by any Affiliate of the Borrower (other than a Wholly Owned
         Subsidiary) or any holder (or any Affiliate of such holder) of 5.0% or
         more of the Borrower's Capital Stock;

                                      -40-

<PAGE>

                 (iii)   make any voluntary or optional principal payment, or
         voluntary or optional redemption, repurchase, defeasance, or other
         acquisition or retirement for value, of Indebtedness of the Borrower
         that is subordinated in right of payment to any of the Obligations; or

                 (iv)    make any Investment, other than a Permitted Investment,
         in any Person (such payments or any other actions described in clauses
         (a)(i) through (iv) above being collectively "Restricted Payments")
         if, at the time of, and after giving effect to, the proposed
         Restricted Payment:

                 (A) a Default or Event of Default shall have occurred and be
         continuing;

                 (B) the Borrower could not Incur at least $1.00 of Indebtedness
         without violating the financial ratios then in effect under Section
         6.1; or

                 (C) the aggregate amount of all Restricted Payments (the
         amount, if other than in cash, to be determined in good faith by the
         Board of Directors of the Borrower, whose determination shall be
         conclusive and evidenced by a resolution) made on or after April 1,
         2002 shall exceed the sum of

                         (1)    50.0% of the aggregate amount of the Adjusted
                 Consolidated Net Income (or, if the Adjusted Consolidated Net
                 Income is a loss, minus 100.0% of the amount of such loss)
                 accrued on a cumulative basis during the period (taken as one
                 accounting period) beginning on April 1, 2002 and ending on
                 the last day of the last fiscal quarter preceding the
                 Transaction Date for which financial statements have been
                 delivered to the Administrative Agent pursuant to Section
                 5.2, plus

                         (2)    the aggregate Net Cash Proceeds received by the
                 Borrower on or after April 1, 2002 from a capital contribution
                 or the issuance and sale permitted by this Agreement of
                 Capital Stock (other than Disqualified Stock) of the Borrower
                 to a Person who is not a Subsidiary of the Borrower,
                 including an issuance or sale permitted by this Agreement of
                 Indebtedness for cash subsequent to the Effective Date upon
                 the conversion of such Indebtedness into Capital Stock of the
                 Borrower (other than Disqualified Stock), or from the
                 issuance to a Person who is not a Subsidiary of the Borrower
                 of any options, warrants or other rights to acquire Capital
                 Stock of the Borrower (in each case, exclusive of any
                 Disqualified Stock or any options, warrants or other rights
                 that are redeemable at the option of the holder, or are
                 required to be redeemed, prior to the Maturity Date), plus

                         (3)    an amount equal to the net reduction in
                 Investments (other than reductions in Permitted Investments)
                 in any Person on or after April 1, 2002 resulting from
                 payments of interest on Indebtedness, dividends, repayments
                 of loans or advances, or other transfers of assets, in each
                 case to the Borrower or any of its Subsidiaries or from the
                 Net Cash Proceeds

                                      -41-

<PAGE>

                 from the sale of any such Investment (except, in each case,
                 to the extent any such payment or proceeds are included in
                 the calculation of Adjusted Consolidated Net Income), not to
                 exceed, in each case, the amount of Investments previously
                 made by the Borrower or any of its Subsidiaries in such
                 Person.

         (b)     The provisions of paragraph (a) of this Section 6.3 shall not
be violated by reason of:

                 (i)     the payment of any dividend within 60 days after the
         date of declaration thereof if, at said date of declaration, such
         payment would comply with the foregoing paragraph;

                 (ii)    the redemption, repurchase, retirement, defeasance or
         other acquisition for value of Indebtedness of the Borrower that is
         subordinated in right of payment to the Obligations, including
         premium, if any, and accrued and unpaid interest, with the proceeds
         of, or in exchange for, Indebtedness that (x) is expressly
         subordinate in right of payment to the Obligations at least to the
         extent that the Indebtedness being refinanced is subordinated
         thereto, (y) does not mature prior to the Maturity Date and (z) has
         an Average Life at least equal to that of the Indebtedness being
         refinanced;

                 (iii)   the repurchase, redemption or other acquisition of
         Capital Stock of the Borrower (or options, warrants or other rights
         to acquire such Capital Stock) in exchange for, or out of the
         proceeds of a substantially concurrent offering of, shares of Capital
         Stock of the Borrower (other than Disqualified Stock) (or options,
         warrants or other rights to acquire such Capital Stock);

                 (iv)    the making of any principal payment or the repurchase,
         redemption, retirement, defeasance or other acquisition for value of
         Indebtedness of the Borrower which is subordinated in right of payment
         to the Obligations, in exchange for, or out of the proceeds of, a
         substantially concurrent offering of, shares of Capital Stock of the
         Borrower (other than Disqualified Stock) (or options, warrants or other
         rights to acquire such Capital Stock);

                 (v)     payments or distributions to dissenting stockholders
         pursuant to applicable law or pursuant to or in connection with a
         consolidation, merger or transfer of assets that complies with the
         provisions of Section 6.11;

                 (vi)    Investments acquired as a capital contribution or in
         exchange for Capital Stock of the Borrower (other than Disqualified
         Stock);

                 (vii)   (x) the payment by the Borrower (made on behalf of
         Grupo TFM) for the repurchase from Mexico of Capital Stock of the
         Borrower, provided that (1) after giving effect to such repurchase
         and any Indebtedness Incurred to fund such repurchase, the
         Consolidated Interest Coverage Ratio would be greater than 4.0:1.0 or
         (2)(A) no Indebtdedness or any other obligation of the Borrower or any
         Subsidiary is Incurred or otherwise created in connection with such
         repurchase

                                      -42-

<PAGE>

         and (B) the consideration paid to Mexico for such repurchase shall not
         exceed the VAT Refund refunded, paid or otherwise credited to the
         Borrower; provided that, in the case of this clause (2)(b), if such
         consideration is paid in cash by the Borrower, payment of the VAT
         Refund shall be made in cash by Mexico prior to or simultaneously
         with such repurchase; and

                         (y) the declaration and payment of dividends in order
                 to effect this clause (vii);

                 (viii)  the declaration or payment of dividends on Capital
         Stock of the Borrower following a Public Equity Offering of such
         Capital Stock, of up to 6.0% per annum of the Net Cash Proceeds
         received by the Borrower in such Public Equity Offering; provided that
         any such amount of Net Cash Proceeds to be so paid as dividends shall
         be placed into an escrow account to be opened and maintained with the
         Administrative Agent promptly upon receipt of such Net Cash Proceeds
         until distribution or payment of such dividends is made; or

                 (ix)    the declaration and payment of dividends to Grupo TFM
         by the Borrower in an amount not to exceed Grupo TFM's operating
         expenses, corporate overhead costs and expenses and taxes; provided
         that the amount so dividended is actually used for such purpose; and
         the declaration and payment of pro rata dividends or distributions on
         Common Stock of the Borrower held by minority stockholders paid in
         connection with dividends to Grupo TFM permitted by this clause (ix),
         provided that such dividends do not in the aggregate exceed the
         minority stockholders' pro rata share of the Borrower's net income
         from July 1, 1997, and provided further that (A) such dividends made
         pursuant to this clause (ix) with respect to operating and corporate
         overhead costs and expenses do not in the aggregate exceed $1,000,000
         for any fiscal year of the Borrower and (B) such dividends made
         pursuant to this clause (ix) with respect to taxes do not in the
         aggregate exceed $5,000,000 for any fiscal year of the Borrower;

provided that, except in the case of clauses (i) and (iii) above, no Default or
Event of Default shall have occurred and be continuing or shall occur as a
consequence of the actions or payments set forth herein.

         (c)     Each Restricted Payment permitted pursuant to the preceding
paragraph (other than the Restricted Payment referred to in clause (ii) thereof,
an exchange of Capital Stock for Capital Stock or Indebtedness referred to in
clause (iii) or (iv) thereof, an Investment referred to in clause (vi) thereof,
a repurchase of Capital Stock referred to in clause (vii) (y) thereof and the
dividends referred to in clauses (vii) thereof), and the Net Cash Proceeds from
any issuance of Capital Stock referred to in clauses (ii) and (iii), shall be
included in calculating whether the conditions of clause (a)(iv)(C) of this
Section 6.3 have been met with respect to any subsequent Restricted Payments. In
the event the proceeds of an issuance of Capital Stock of the Borrower are used
for the redemption, repurchase or other acquisition of the Obligations or
Indebtedness that is pari passu with the Obligations, then the Net Cash Proceeds
of such issuance shall be included in clause (a)(iv)(C) of this Section 6.3 only
to the extent such proceeds are not used for such redemption, repurchase or
other acquisition of Indebtedness.

                                      -43-

<PAGE>

         (d)     Notwithstanding anything to the contrary in the foregoing
provisions or herein, under no circumstances shall the Borrower assume the
obligation of Grupo TFM, KCSI or Grupo TMM under the agreement dated as of June
9, 1997 celebrated by The Federal Government of the United States of Mexico,
Grupo TFM, Grupo TMM, and KCSI to repurchase the Capital Stock of the Borrower;
provided that the Borrower shall be permitted to pay the repurchase price
thereof on behalf of Grupo TFM or Grupo TMM in accordance with the terms of
Section 6.3(b)(vii).

         SECTION 6.4.      Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries.

         (a)     Create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Subsidiary to (i) pay dividends or make any other distributions permitted
by applicable law on any Capital Stock of such Subsidiary owned by the Borrower
or any other Subsidiary; (ii) pay any Indebtedness owed to the Borrower or any
other Subsidiary; (iii) make loans or advances to the Borrower or any other
Subsidiary; or (iv) transfer any of its property or assets to the Borrower or
any other Subsidiary.

         (b)     The foregoing provisions shall not restrict any encumbrances
or restrictions:

                 (i)    existing on the Effective Date and set forth on
         Schedule 6.4(b)(i);

                 (ii)   existing in the Senior Note Indentures and the Senior
         Discount Debenture Indentures, and any extensions, refinancings,
         renewals or replacements thereof; provided that the encumbrances and
         restrictions in any such extensions, refinancings, renewals or
         replacements are no less favorable in any material respect to the
         Banks than those encumbrances or restrictions that are then in effect
         and that are being extended, refinanced, renewed or replaced;

                 (iii)  existing under or by reason of applicable law;

                 (iv)   existing with respect to any Person or the property or
         assets of such Person acquired by the Borrower or any of its
         Subsidiaries, existing at the time of such acquisition and not
         incurred in contemplation thereof, which encumbrances or restrictions
         are not applicable to any Person or the property or assets of any
         Person other than such Person or the property or assets of such
         Person so acquired;

                 (v)    in the case of transfers of any property or assets of a
         Subsidiary to the Borrower or any other Subsidiary

                        (x) that restrict in a customary manner the subletting,
                  assignment or transfer of any property or asset that is a
                  lease, license, conveyance or contract or similar property or
                  asset,

                                      -44-

<PAGE>

                        (y) existing by virtue of any transfer of, agreement to
                  transfer, option or right with respect to, or Lien on, any of
                  the property or assets of the Borrower or any of its
                  Subsidiaries not otherwise prohibited by this Agreement, or

                        (z) arising or agreed to in the ordinary course of
                  business, not relating to any Indebtedness, and that do not,
                  individually or in the aggregate, detract from the value of
                  the property or assets of the Borrower or any of its
                  Subsidiaries in any manner material to the Borrower or to
                  any of its Subsidiaries,

                  (vi)    with respect to a Subsidiary and imposed pursuant to
         an agreement that has been entered into for the sale or disposition of
         all or substantially all of the Capital Stock of, or property and
         assets of, such Subsidiary; or

                  (vii)   for the benefit of any holder of a Lien permitted
         under Section 6.8.

Nothing contained in this Section 6.4 shall prevent the Borrower or any of its
Subsidiaries from (1) creating, incurring, assuming or suffering to exist any
Liens otherwise permitted by Section 6.8 or (2) restricting the sale or other
disposition of property or assets of the Borrower or any of its Subsidiaries
that secure their respective Indebtedness.

         SECTION 6.5.      Limitation on the Issuance and Sale of Capital Stock
of Subsidiaries. Issue or sell, any shares of Capital Stock of a Subsidiary
(including options, warrants or other rights to purchase shares of such Capital
Stock) except:

         (a)     to the Borrower or a Wholly Owned Subsidiary;

         (b)     issuances of director's qualifying shares or sales to foreign
nationals of shares of Capital Stock of foreign Subsidiaries, to the extent
required by applicable law;

         (c)     if, immediately after giving effect to such issuance or sale,
such Subsidiary would no longer constitute a Subsidiary and any Investment in
such Person remaining after giving effect to such issuance or sale would have
been permitted to be made under Section 6.3 if made on the date of such issuance
or sale; or

         (d)     issuances of Common Stock that has no preference with respect
to dividends or upon liquidation, the Net Cash Proceeds of which are promptly
applied as provided in Section 2.4(b).

         SECTION 6.6.      Limitation on Issuances of Guarantees by
                           Subsidiaries.

         (a)     With respect to any Subsidiary, Guarantee any Indebtedness of
the Borrower which is pari passu with or subordinate in right of payment to the
Obligations ("Guaranteed Indebtedness"), unless:

                  (i)      such Subsidiary simultaneously executes and delivers
         a guarantee (a "Subsidiary Guarantee") of payment of the Obligations;
         and

                                      -45-

<PAGE>

                  (ii)     such Subsidiary waives and will not in any manner
          whatsoever claim or take the benefit or advantage of, any rights of
          reimbursement, indemnity or subrogation or any other rights against
          the Borrower or any other Subsidiary as a result of any payment by
          such Subsidiary under its Subsidiary Guarantee until the Term Loans
          have been paid in full, in U.S. dollars;

provided that this paragraph shall not be applicable to any Guarantee of any
Subsidiary that existed at the time such Person became a Subsidiary and was not
Incurred in connection with, or in contemplation of, such Person becoming a
Subsidiary.

         (b)      If the Guaranteed Indebtedness is (i) pari passu with the Term
Loans, then the Guarantee of such Guaranteed Indebtedness shall be pari passu
with, or subordinated to, the Subsidiary Guarantee or (ii) subordinated to the
Term Loans, then the Guarantee of such Guaranteed Indebtedness shall be
subordinated to the Subsidiary Guarantee at least to the extent that the
Guaranteed Indebtedness is subordinated to the Term Loans.

         (c)      Notwithstanding the foregoing, any Subsidiary Guarantee by a
Subsidiary shall provide by its terms that it shall be automatically and
unconditionally released and discharged upon:

                  (i)      any sale, exchange or transfer, to any Person not an
          Affiliate of the Borrower, of all of the Borrower's or any
          Subsidiary's Capital Stock in, or all or substantially all the assets
          of, such Subsidiary (which sale, exchange or transfer is not
          prohibited by this Agreement); or

                  (ii)     the release or discharge of the Guarantee which
          resulted in the creation of such Subsidiary Guarantee, except a
          discharge or release by or as a result of payment under such
          Guarantee.

         SECTION 6.7.      Limitation on Transactions with Stockholders and
Affiliates.

         (a)      Enter into, renew or extend any transaction (including,
without limitation, the purchase, sale, lease or exchange of property or assets,
or the rendering of any service) with any holder (or any Affiliate of such
holder) of 5.0% or more of any class of Capital Stock of Grupo TFM or the
Borrower or with any Affiliate of Grupo TFM or the Borrower or any Subsidiary,
except upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary than could be obtained, at the time of such transaction or, if such
transaction is pursuant to a written agreement, at the time of the execution of
the agreement providing therefor, in a comparable arm's-length transaction with
a Person that is not such a holder or an Affiliate.

         (b)      The limitation of paragraph (a) of this Section 6.7 does not
limit, and shall not apply to:

                  (i)      transactions for which the Borrower or a Subsidiary
          delivers to the Administrative Agent a written opinion of a United
          States nationally recognized investment banking firm (or their Mexican
          affiliate) stating that the transaction is fair to the Borrower or
          such Subsidiary from a financial point of view;

                                      -46-

<PAGE>

                  (ii)     payment of reasonable and customary regular fees and
          compensation to directors and officers of the Borrower and Grupo TFM
          consistent with past practices;

                  (iii)    payments or other transactions pursuant to any
          tax-sharing agreement between the Borrower and any Subsidiary of the
          Borrower with which the Borrower files a consolidated tax return or
          with which the Borrower is part of a consolidated group for tax
          purposes;

                  (iv)     payment of the Management Fees;

                  (v)      sales of equipment to a Wholly Owned Subsidiary
         pursuant to an arrangement under which such equipment will be leased
         back to the Borrower on terms that are no less favorable to the
         Borrower than the terms that would have been offered by an unrelated
         party; and

                  (vi)     other transactions in the aggregate in any calendar
         year involving consideration of no more than $2,000,000.

         SECTION 6.8.      Limitation on Liens. Create, incur, assume or suffer
to exist any Lien on any of the Borrower's or any Subsidiary's assets or
properties of any character, or on any shares of Capital Stock or Indebtedness
of any Subsidiary, except:

         (a)      Liens existing on the Effective Date and set forth on Schedule
6.8(a);

         (b)      Liens granted after the Effective Date on any of the assets or
Capital Stock of the Borrower or its Subsidiaries created in favor of the Banks
to secure the Obligations;

         (c)      Liens with respect to the assets of a Subsidiary granted by
such Subsidiary to the Borrower or a Wholly Owned Subsidiary to secure
Indebtedness owing to the Borrower or such other Subsidiary;

         (d)      Liens securing Indebtedness which is Incurred to refinance
secured Indebtedness; provided that such Liens do not extend to or cover any
property or assets of the Borrower or any Subsidiary other than the property or
assets securing the Indebtedness being refinanced;

         (e)      Liens securing Indebtedness outstanding at any time in an
aggregate principal amount not to exceed $50,000,000 that is Incurred solely for
the purpose of financing the cost of improvements or construction related to the
properties of Mexrail and the Texas Mexican Railway Company, the net proceeds of
which are applied to finance the cost of improvements or construction; or

         (f)      Permitted Liens and other Liens permitted or required by this
Agreement and the Notes.

         SECTION 6.9.      Limitation on Sale-Leaseback Transactions.

                                      -47-

<PAGE>

         (a)      Enter into any sale-leaseback transaction involving any of the
Borrower's or any of its Subsidiary's assets or properties whether now owned or
hereafter acquired, whereby the Borrower or a Subsidiary sells or transfers such
assets or properties and then or thereafter leases such assets or properties or
any part thereof or any other assets or properties which the Borrower or such
Subsidiary, as the case may be, intends to use for substantially the same
purpose or purposes as the assets or properties sold or transferred.

         (b)      The foregoing restriction does not apply to any sale-leaseback
transaction if:

                  (i)      the lease is for a period, including renewal rights,
          of not in excess of three years;

                  (ii)     the lease secures or relates to industrial revenue or
          pollution control bonds;

                  (iii)    the transaction is solely between the Borrower and
          any Wholly Owned Subsidiary or solely between Wholly Owned
          Subsidiaries; or

                  (iv)     the Borrower or such Subsidiary, within twelve months
          after the sale or transfer of any assets or properties is completed,
          applies an amount not less than the Net Cash Proceeds received from
          such sale to prepay the Term Loans in accordance with Section 2.4(b).

          SECTION 6.10.     Limitation on Asset Sales. Consummate any Asset
Sale, unless:

          (a)      the consideration received by the Borrower or such Subsidiary
is at least equal to the fair market value of the assets sold or disposed of;

          (b)      at least 80.0% of the consideration received (excluding any
amount of Released Indebtedness) consists of cash or Temporary Cash Investments;
and

          (c)      the Net Cash Proceeds of such Asset Sales are applied in
accordance with Section 2.4(b); provided, however, that in no event shall the
Borrower or any of its Subsidiaries enter into any Asset Sale with respect to
future accounts receivables to be generated by it.

For the purposes of this Section 6.10,"Released Indebtedness" shall mean, with
respect to any Asset Sale, Indebtedness (i) which is owed to the Borrower by any
of its Subsidiaries (the "Obligors") prior to such Asset Sale, (ii) which is
assumed by the purchaser or any affiliate thereof in connection with such Asset
Sale and (iii) with respect to which Obligors receive written unconditional
releases from each creditor no later than the closing date of such Asset Sale.

         SECTION 6.11.     Consolidation, Merger and Sale of Assets.

         Consolidate with, merge with or into, or sell, convey, transfer, lease
or otherwise dispose of all or substantially all of the property and assets of
the Borrower or any of its Subsidiaries (as an entirety or substantially an
entirety in one transaction or a series of related

                                      -48-

<PAGE>

transactions) to, any Person or permit any Person to merge with or into the
Borrower or any Subsidiary except that:

         (a)      any Subsidiary of the Borrower may be merged or consolidated
with or into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any Wholly Owned Subsidiary (provided
that the Wholly Owned Subsidiary shall be the continuing or surviving
corporation);

         (b)      any Subsidiary or the Borrower may dispose of any or all of
its assets (i) to the Borrower or any Wholly Owned Subsidiary (upon voluntary
liquidation or otherwise) or (ii) pursuant to a disposition permitted by Section
6.10; and

         (c)      any Investment expressly permitted by Section 6.3 may be
structured as a merger, consolidation or amalgamation; and

         (d)      the Borrower or such Subsidiary may merge or consolidate with
or into a Person (other than the Borrower or one of its Subsidiaries), or sell,
convey, transfer, lease or otherwise dispose of all or substantially all of the
property and assets of the Borrower or Subsidiaries to a Person (other than the
Borrower or one of its Subsidiaries) provided that:

                  (i)    the Borrower or such Subsidiary shall be the
         continuing Person, or the Person (if other than the Borrower) formed
         by such consolidation or into which the Borrower is merged or that
         acquired or leased such property and assets shall be a corporation
         organized and validly existing under the laws of Mexico, the United
         States of America or any jurisdiction of either such country and
         shall expressly assume in an agreement in form and substance
         satisfactory to the Administrative Agent, all of the obligations of
         the Borrower or such Subsidiary hereunder and under the Notes;

                  (ii)   immediately after giving effect to such transaction,
          no Default or Event of Default shall have occurred and be continuing;

                  (iii)  immediately after giving effect to such
          transaction on a pro forma basis, the Borrower or such Subsidiary, or
          any Person becoming the successor obligor hereunder and under the
          Notes shall have a Consolidated Net Worth equal to or greater than the
          Borrower's or such Subsidiary's (as applicable) Consolidated Net
          Worth, immediately prior to such transaction;

                  (iv)   immediately after giving effect to such transaction
          on a pro forma basis the Borrower or such Subsidiary, or any Person
          becoming the successor obligor hereunder and under the Notes could
          Incur at least $1.00 of Indebtedness without violating the covenants
          in Section 6.1 after giving pro forma effect to the proposed
          transaction; and

                  (v)    the Borrower delivers to the Administrative Agent a
          certificate of a Responsible Officer (attaching the arithmetic
          computations to demonstrate compliance with clauses (d)(iii) and
          (d)(iv)) stating that such consolidation,

                                      -49-

<PAGE>

          merger or transfer complies with this provision and that all
          conditions precedent provided for herein relating to such transaction
          have been complied with;

provided, however, with respect to this subsection (d), that only clause (i)
hereof shall apply for a merger or consolidation of the Borrower and Grupo TFM.

          SECTION 6.12.    Lines of Business. Enter into any business, either
directly or through any Subsidiary, except for those businesses in which the
Borrower and its Subsidiaries are engaged on the date of this Agreement or that
are reasonably related thereto.

          SECTION 6.13.    Additional Indebtedness. Create, incur, assume or
suffer to exist Indebtedness which provides for the amortization of principal
prior to the Maturity Date other than (a) Indebtedness existing on the Effective
Date and other Indebtedness subsequently created, incurred or assumed which, in
the aggregate, provides for the amortization of less than $10,000,000 in the
aggregate prior to the Maturity Date, (b) short-term revolving Indebtedness
secured by current receivables permitted by paragraph (q) of the definition of
"Permitted Liens," (c) Indebtedness under Swap Agreements (excluding equity
based Swap Agreements) entered into in the ordinary course of business; provided
that such Swap Agreements (i) are designed solely to protect the Borrower or its
Subsidiaries against the fluctuations in foreign currency exchange rates or
interest rates or rates in respect of fuel purchases or other acquisitions of
fuel in the ordinary course of business and (ii) do not increase the
Indebtedness of the obligor outstanding at any time other than as a result of
fluctuations in foreign currency exchange rates or interest rates or by reason
of fees, indemnities and compensation payable thereunder and (d) Indebtedness
owed to the Borrower by a Wholly Owned Subsidiary.

                             ARTICLE VII

                          EVENTS OF DEFAULT

         SECTION 7.1.      Events of Default. The following specified events
shall be "Events of Default" for the purposes of this Agreement:

         (a)      The Borrower shall fail to pay any principal of, or any
interest on, any Note or any Term Loan when due in accordance with the terms
thereof or hereof; or the Borrower shall fail to pay any other amount under this
Agreement within ten calendar days after any other amount becomes due in
accordance with the terms hereof; or

         (b)      Any representation or warranty made or deemed made by the
Borrower herein or in any Note or which is contained in any certificate,
document or financial or other statement furnished at any time pursuant to or in
connection with this Agreement shall prove to have been incorrect in any
material respect on or as of the date made or deemed made, or

         (c)      The Borrower shall default in the observance or performance of
any covenant contained in Sections 5.1, 5.3(a), 5.4, 5.5(a), 5.10 or Article VI
of this Agreement; or

         (d)      The Borrower shall default in the observance or performance of
any other covenant or agreement contained in this Agreement or any Note (other
than as provided in

                                      -50-

<PAGE>

Sections 7.1(a), 7.1(b) and 7.1(c), and such default shall continue unremedied
for a period of 30 days after written notice to the Borrower from the
Administrative Agent; or

         (e)      The Borrower or any of its Subsidiaries shall (i) default in
any payment of principal of or interest on any Indebtedness (other than the
Notes), including in the payment of any Guarantee, beyond the period of grace,
if any, provided in the instrument or agreement under which such Indebtedness
was created (except for any such defaults in respect of Indebtedness and
Guarantees in respect thereof in an aggregate then outstanding amount for all
such Indebtedness of less than US$10,000,000 or an amount in another currency
equivalent thereto); or (ii) default in the observance or performance of any
other agreement or condition relating to any such Indebtedness or Guarantee or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, in each case beyond
any applicable grace period or cure period, the effect of which default or other
event or condition is to cause, or to permit the holder or holders of such
Indebtedness, including the beneficiary or beneficiaries of any Guarantee (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity, including any Guarantee
to become payable (except for any such default or other event or condition in
respect of Indebtedness in an aggregate then outstanding amount for all such
Indebtedness of less than US$10,000,000 or an amount in another currency
equivalent thereto); or

         (f)      (i)     The Borrower or any of its Subsidiaries shall commence
any case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, concurso mercantil,
insolvency, reorganization or relief of debtors, seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, or (B) in any jurisdiction seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or the Borrower or any of its Subsidiaries shall
make a general assignment for the benefit of its creditors; or (ii) there shall
be commenced against the Borrower or any of its Subsidiaries in any jurisdiction
any case, proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such adjudication
or appointment or (B) to the extent applicable, remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any of its Subsidiaries in any jurisdiction
any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) the Borrower or
any of its Subsidiaries shall take any action in furtherance of, or indicating
its consent to, approval of, or acquiescence in, any of the acts set forth in
clause (i), (ii) or (iii) above; or (v) the Borrower or any of its Subsidiaries
shall admit in writing its inability to pay its debts as they become due; or

         (g)      One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries in any jurisdiction involving in the
aggregate a liability (not paid or fully covered by insurance) of US$10,000,000
(or an amount in another currency equivalent

                                      -51-

<PAGE>

thereto) or more, and all such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within 90 days from the
entry thereof; or

         (h)      Any Governmental Authority shall (i) condemn, nationalize,
seize or otherwise expropriate any substantial portion of the assets or the
capital stock of the Borrower and such action is not reversed within a period of
60 days or (ii) take any action that would prevent the Borrower from carrying
on, or would materially interfere with, any material part of its business or
operations, including, without limitation, any action that would result in the
Concession Title ceasing to grant the Borrower the rights originally provided
therein or the Concession Title being terminated or the rights originally
provided therein as exclusive to the Borrower becoming non-exclusive; or

         (i)      A Change of Control shall occur; or

         (j)      The validity of this Agreement or any Note shall be contested
by the Borrower or any Governmental Authority or the Borrower shall deny
liability hereunder or under any Note or this Agreement or any Note shall for
any reason be terminated or become invalid, ineffective or unenforceable;
provided, in the case of any contest by a Governmental Authority such contest is
not dismissed within a period of 60 days; or

         (k)      Any governmental or other consent, license, approval
(including any foreign exchange approval) or authorization which is now or may
in the future be necessary or appropriate under any applicable law or regulation
for the execution, delivery or performance by the Borrower of any material
obligation under this Agreement or any Note or to make this Agreement or any
Note legal, valid, enforceable and admissible in evidence shall not be obtained
or shall be withdrawn or shall cease to be in full force and effect or shall be
modified in a manner which has a reasonable likelihood of having a Material
Adverse Effect; or

         (l)      Any restriction or requirement not in effect on the date
hereof is imposed, whether by legislative enactment, decree, regulation, order
or otherwise, which limits the availability or the transfer of foreign exchange
by the Borrower and interferes with the Borrower's performance of any material
obligation under this Agreement or any Note to which it is a party; or

         (m)      There shall occur any circumstance and/or event of a
financial, political or economic nature in Mexico which, in the reasonable
judgment of the Majority Banks, is likely to have a material adverse effect on
the ability of the Borrower to perform its obligations under this Agreement or
any Note.

         SECTION 7.2.     Remedies. (a) If any Event of Default under
Section 7.1(f) has occurred and is continuing, automatically the Commitments
shall immediately terminate and the Term Loans, together with accrued interest
thereon and any fees and all other Obligations accrued hereunder and under the
Notes shall immediately become due and payable.

         (b)      If any Event of Default other than under Section 7.1(f) has
occurred and is continuing, the Administrative Agent shall, at the request of,
or may with the consent of, the Majority Banks, declare the principal amount of
the Term Loans to be forthwith due and

                                      -52-

<PAGE>

payable, whereupon such principal amount, together with accrued interest thereon
and any fees and all other Obligations accrued hereunder and under the Notes,
shall become immediately due and payable, without presentment, demand, protest
or other notice of any kind, all of which are hereby expressly waived.

                                 ARTICLE VIII

                           THE ADMINISTRATIVE AGENT

         SECTION 8.1.     Appointment. Each Bank hereby irrevocably designates
and appoints JPMCB, as the Administrative Agent of such Bank under this
Agreement, and each such Bank hereby irrevocably authorizes JPMCB, as the
Administrative Agent for such Bank, to take such action on its behalf under the
provisions of this Agreement and to exercise such powers and perform such duties
as are expressly delegated to the Administrative Agent by the terms of this
Agreement, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Bank, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent.

         SECTION 8.2.     Delegation of Duties. The Administrative Agent may
execute any of its duties under this Agreement by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties.

         SECTION 8.3.     Exculpatory Provisions. Neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or any such Person under or in connection with this Agreement
(except for its or such Person's own gross negligence or willful misconduct), or
(b) responsible in any manner to any of the Banks for any recitals, statements,
representations or warranties made by the Borrower or any officer thereof
contained in this Agreement or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative Agent
under or in connection with, this Agreement or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any Notes or for any failure of the Borrower to perform its obligations
hereunder or thereunder.  Except in respect of Section 3.1 or except as
otherwise expressly stated herein, the Administrative Agent shall not be under
any obligation to any Bank to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement, or to inspect the properties, books or records of the Borrower.

         SECTION 8.4.     Reliance by the Administrative Agent. The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any agreement (including this Agreement), note (including any
Note), writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram or teletype message, statement, order or other document or
facsimile transmission or telephone conversation reasonably believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including counsel to
the Borrower), independent

                                      -53-

<PAGE>

accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement unless it shall first receive such advice or
concurrence of the Majority Banks as it deems appropriate or it shall first be
indemnified to its satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Administrative Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement and the Notes in
accordance with a request of the Majority Banks, and such request and any action
taken or failure to act pursuant thereto shall be binding upon all the Banks and
all future holders of the Notes.

         SECTION 8.5.     Notice of Default. The Administrative Agent shall not
be deemed to have knowledge or notice of the occurrence of any Default or Event
of Default hereunder unless the Administrative Agent has received notice from a
Bank or the Borrower referring to this Agreement, describing such Default or
Event of Default. In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give prompt notice thereof to the Banks.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be directed by the Majority Banks; provided that,
unless and until the Administrative Agent shall have received such directions,
the Administrative Agent may (but shall not be obligated to) take such action,
in accordance with the terms hereof, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Banks.

         SECTION 8.6.     Non-Reliance on the Administrative Agent and Other
Banks. Each Bank expressly acknowledges that neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Bank. Each Bank represents to the Administrative
Agent that it has, independently and without reliance upon the Administrative
Agent or any other Bank, and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and made its own decision to make its loans
hereunder and enter into this Agreement. Each Bank also represents that it will,
independently and without reliance upon the Administrative Agent or any other
Bank, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement, and to make such
investigations as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrower. Except for notices, reports and other documents expressly required to
be furnished by the Borrower to the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Bank with any information concerning the business, operations, property,
financial and other condition or creditworthiness of the Borrower which may come
into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.

                                      -54-

<PAGE>

         SECTION 8.7.      Indemnification. The Banks agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective Commitment Percentages in effect on the
date on which indemnification is sought under this Section 8.7 (or, if
indemnification is sought after the date upon which all of the Commitments shall
have terminated and the Obligations shall have been paid in full, ratably in
accordance with their respective Commitment Percentages immediately prior to
such termination), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including at any
time following the payment of the Obligations or the Maturity Date) be imposed
on, incurred by or asserted against the Administrative Agent in any way relating
to or arising out of this Agreement, or any documents contemplated by or
referred to herein or the transactions contemplated hereby or any action taken
or omitted by the Administrative Agent under or in connection with any of the
foregoing; provided, however, that such indemnity shall not, as to the
Administrative Agent, be available to the extent that such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements are determined by a court of competent jurisdiction by
final and non-appealable judgment to have resulted from the Administrative
Agent's gross negligence or willful misconduct. The Agreements in this Section
8.7 shall survive the payment of the Obligations and the Maturity Date.

         SECTION 8.8.      The Administrative Agent in Its Individual Capacity.
JPMCB and its Affiliates may make loans to, accept deposits from and generally
engage in any kind of business with the Borrower as though JPMCB were not the
Administrative Agent hereunder.  With respect to Term Loans made by it and any
Note issued to it, JPMCB shall have the same rights and powers under this
Agreement as any Bank and may exercise the same as though it were not the
Administrative Agent, and the terms "Bank" and "Banks" shall include JPMCB and
such Affiliates in their individual capacities.

         SECTION 8.9.      Successor Administrative Agent. The Administrative
Agent may be removed at any time upon the written request of all of the Banks
(not including the Administrative Agent or its Affiliates) and the written
consent of the Borrower, such consent not to be unreasonably withheld, delivered
to the Administrative Agent and the Borrower. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Banks and the
Borrower. If the Administrative Agent shall resign or be removed as
Administrative Agent under this Agreement, then the Majority Banks shall appoint
from among the Banks a successor agent for the Banks which successor agent shall
be subject to approval by the Borrower, whereupon such successor agent shall
succeed to the rights, powers and duties of the Administrative Agent, and the
term "Administrative Agent" shall mean such successor agent effective upon its
appointment, and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Notes. After any retiring Administrative
Agent's resignation or removal hereunder as Administrative Agent, the provisions
of this Article VIII shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement. In the event the Administrative Agent resigns or is removed pursuant
to this Section 8.9, all fees paid to the resigning Administrative Agent but not
yet accrued shall be transferred to the successor Administrative Agent.

                                      -55-

<PAGE>

                                   ARTICLE IX

                      THE JOINT LEAD ARRANGERS, ARRANGERS,
                               DOCUMENTATION AGENT

         SECTION 9.1.     The Joint Lead Arrangers, etc. The Borrower hereby
confirms the appointment of and designates J.P. Morgan Securities Inc. and
Salomon Smith Barney Inc., as Joint Lead Arrangers, Bank of America, N.A.,
Comerica Bank and Landesbank Schleswig- Holstein Girozentrale, Kiel and Standard
Chartered Bank, as Arrangers (the Joint Lead Arrangers and the Arrangers for
purposes of this Article XII, individually, an "Arranger" and collectively, the
"Arrangers") and Standard Chartered Bank, as Documentation Agent (the
Documentation Agent for purposes of this Article IX, the "Agent") under this
Agreement. The Arrangers and the Agent assume no responsibility or obligation
hereunder for servicing, enforcement or collection of the Obligations, or any
duties as agent for the Banks. The title "Joint Lead Arranger", "Arranger" or
"Documentation Agent" implies no fiduciary responsibility on the part of such
Arranger or Agent to the Banks or any other party to this Agreement and the use
of such title does not impose on any Arranger or Agent any duties or obligations
under this Agreement except as may be expressly set forth herein.

         SECTION 9.2.     Exculpatory Provisions. No Arranger or Agent nor any
of its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by them under or in connection with this Agreement (except for its or for
such Person's own gross negligence or willful misconduct), or (b) responsible in
any manner to any of the Banks for any recitals, statements, representations or
warranties made by the Borrower or any officer thereof contained in this
Agreement or in any certificate, report, statement or other document referred to
or provided for in, or received by any Arranger or Agent under or in connection
with, this Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any Note or for any failure
of the Borrower to perform its obligations hereunder or thereunder. Except as
otherwise expressly stated herein, no Arranger or Agent shall be under any
obligation to any Bank to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement, or to inspect the properties, books or records of the Borrower.

         SECTION 9.3.     Arrangers and Agent. Bank of America, N.A., Comerica
Bank, Landesbank Schleswig-Holstein Girozentrale, Kiel and Standard Chartered
Bank and their respective affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower as though Bank of
America, N.A., Comerica Bank, Landesbank Schleswig-Holstein Girozentrale, Kiel
and Standard Chartered Bank. were not an Arranger or Agent hereunder.

         SECTION 9.4.     Non-Reliance on the Arrangers, Agent and Other Banks.
Each Bank expressly acknowledges that no Arranger or Agent nor any of its
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
any Arranger or Agent hereinafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any representation or warranty by
such Arranger or Agent to any Bank. Each Bank represents to the Arrangers and
the Agent that

                                      -56-

<PAGE>

it has, independently and without reliance upon any Arranger or Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Borrower and made its own decision to make its loans hereunder and enter into
this Agreement. Each Bank also represents that it will, independently and
without reliance upon any Arranger or Agent or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Agreement, and to make such investigations as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Borrower. No Arranger or Agent
shall have any duty or responsibility to provide any Bank with any information
concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrower which may come into the possession of such
Arranger or Agent or any of its respective officers, directors, employees,
agents, attorneys-in-fact or affiliates.

                                    ARTICLE X

                                  MISCELLANEOUS

         SECTION 10.1.    Transfers of Funds. All payments and other transfers
of funds under this Agreement shall be made in immediately available funds,
exclusively in U.S. Dollars, to accounts or payment offices maintained in New
York, New York, unless, in the case of payments by or on behalf of a party other
than the Borrower, otherwise specified herein or the recipient thereof shall
otherwise agree.

         SECTION 10.2.    Financial Data. Except as otherwise provided herein,
financial data required hereby shall be prepared both as to classification of
items and as to amount in accordance with IAS.

         SECTION 10.3.    Payment of Expenses, etc.

         (a)      The Borrower agrees, whether or not the transactions hereby
contemplated shall be consummated, upon demand to reimburse and hold the
Administrative Agent, the Joint Lead Arrangers and the Arrangers harmless from
liability for the payment of all reasonable and documented out-of-pocket costs
and expenses (the "Facility Expenses") arising in connection with the
preparation, execution and delivery of this Agreement and any other documents
relating to the transactions contemplated hereby, including (i) the reasonable
fees, travel expenses, courier charges, communication expenses, expenses
associated with the execution of this Agreement and all other out-of-pocket
expenses and (ii) all reasonable fees and disbursements of counsel for the
Administrative Agent, the Joint Lead Arrangers and the Arrangers.

         (b)      The Borrower further agrees, upon demand communicated through
the Administrative Agent, to reimburse and hold the Banks, the Administrative
Agent, the Joint Lead Arrangers and the Arrangers harmless from liability for
the payment of all of their out-of-pocket costs and expenses reasonably incurred
by any of them and arising in connection with any Default or Event of Default or
the enforcement of, or the amendment, modification, waiver and/or preservation
of any rights under, this Agreement, the Notes or otherwise in connection

                                      -57-

<PAGE>

with the transactions contemplated hereby, including all reasonable fees and
disbursements of counsel of each Bank, the Administrative Agent, the Joint Lead
Arrangers and the Arrangers, and all stamp taxes (including interest and
penalties, if any), recording taxes and fees and filing taxes and fees which may
be payable in respect thereof.

         SECTION 10.4.    Amendments and Waivers. No waiver, amendment,
supplement or modification hereto shall be effective unless in writing and
signed by the Borrower and such other parties as are required under this Section
10.4. With the written consent of the Majority Banks, the Administrative Agent
(on behalf of the Banks) and the Borrower may, from time to time, enter into
written amendments, supplements or modifications hereto for the purpose of
adding any provisions to this Agreement or the Notes or changing in any manner
the rights of the Banks, the Administrative Agent or of the Borrower hereunder
or thereunder, and with the consent of the Majority Banks, the Administrative
Agent (on behalf of the Banks) may execute and deliver to the Borrower a written
instrument waiving, on such terms and conditions as the Administrative Agent may
specify in such instrument, any of the requirements of this Agreement or the
Notes or any Default or Event of Default and its consequences; provided,
however, no such waiver and no such amendment, supplement or modification shall:

         (a)      (i)      extend the maturity of any of the Obligations, extend
the time of payment of interest thereon, or extend the Maturity Date;

                  (ii)     reduce the principal amount of the Obligations,
         reduce the rate of interest thereon, or reduce the amount or change the
         method of calculation of any Fees;

                  (iii)    amend, modify or waive any provision of this
         Section 10.4;

                  (iv)     reduce the percentage specified in the definition of
         Majority Banks;

                  (v)      amend, modify or waive any provision of Section 3.1;
         or

                  (vi)     consent to the assignment or transfer by the Borrower
         of any of its rights and obligations under this Agreement or the Notes;

in each case without the written consent of all the Banks;

         (b)      amend, modify or waive any provision of Article VIII without
the written consent of the Administrative Agent;

         (c)      increase the amount of any Bank's Commitment without the
written consent of such Bank; or

         (d)      amend, modify or waive any provision of Article IX without the
written consent of the Joint Lead Arrangers and the Arrangers and the
Documentation Agent.

                                      -58-

<PAGE>

         Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Banks and shall be binding upon the Borrower,
the Banks, the Administrative Agent, the Joint Lead Arrangers, the Arrangers,
the Documentation Agent and all future holders of the Notes. In the case of any
waiver, the Borrower, the Banks, the Joint Lead Arrangers, the Arrangers, the
Documentation Agent and the Administrative Agent shall be restored to their
former positions and rights hereunder and under the outstanding Notes, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.

         SECTION 10.5.     GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

         SECTION 10.6.     Indemnification.

         (a)     The Borrower agrees to indemnify the Administrative Agent, the
Joint Lead Arrangers, the Arrangers, the Banks and each Related Party of any of
the foregoing Persons (each such Person being called an "Indemnitee") from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever, including, without limitation, all reasonable fees, documented as to
the scope of services provided, and disbursements of counsel (including the
allocated cost of internal counsel) which may at any time (including at any time
following the payment of the Obligations or the Maturity Date) be imposed on or
incurred by any such Indemnitee in connection with the investigation of,
preparation for, participation in or outcome of any pending or threatened claim
or cause of action relating to or arising out of this Agreement or any documents
contemplated by or referred to herein or the transactions contemplated hereby or
thereby or any action taken or omitted by such Indemnitee under or in connection
with any of the foregoing and which would not have been incurred by or asserted
or awarded against such indemnified party but for such Indemnitee being involved
with the Agreement or any documents contemplated by or referred to herein or the
transactions contemplated hereby or any action taken or omitted by such
Indemnitee in connection with any of the foregoing; provided, however, that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements are determined by a court of competent
jurisdiction by final and non-appealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee.

         (b)     This Section 10.6 shall survive the termination of this
Agreement and the payment of the Obligations.

         SECTION 10.7.     Notices.

         (a)     Except as otherwise expressly provided herein, all notices,
requests, demands or other communications to or upon the respective parties
hereunder shall be in writing, sent by courier or express mail service or by
facsimile transmission and, unless otherwise expressly provided herein, shall be
effective upon receipt by the party to whom such

                                      -59-

<PAGE>

communications were sent, or, in the case of notice by facsimile, upon
confirmation by the sender of receipt, addressed to such party, at its address
shown in Schedule 1.1(b) (in the case of the Banks) or below (in all other
cases) or at such other address as such party may hereafter notify to the other.
Any communication with respect to a change of address shall be deemed to be
given or made when received by the party to whom such communication was sent.

         (b)     Notices and other communications to the Banks hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Article II unless otherwise agreed by the
Administrative Agent and the applicable Bank. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.

If to the Borrower:                     TFM, S.A. de C.V.
                                        Av. Periferico Sur No. 4829
                                        4(degree) Piso
                                        Parques del Pedregal, C.P. 14010
                                        Delagacion Tlalpan, Mexico, D.F. Mexico
                                        Attention: Chief Financial Officer
                                        Telephone: (011-52-555) 447-5870
                                        Facsimile: (011-52-555) 447-5755

If to the Administrative Agent:         JPMorgan Chase Bank
                                        1 Chase Manhattan Plaza
                                        8th Floor
                                        New York, New York 10081
                                        Attention: Lascelles D. Thompson
                                        Telephone: (212) 552-7242
                                        Facsimile: (212) 552-5646

If to the Joint Lead Arrangers:         J.P. Morgan Securities Inc.
                                        270 Park Avenue
                                        New York, New York, 10017
                                        Attention: Linda M. Meyer
                                        Telephone: (212) 552-6776
                                        Facsimile: (212) 552-8890

                                        and

                                        Salomon Smith Barney Inc.
                                        390 Greenwich Street
                                        1st Floor
                                        New York, New York 10013
                                        Attention: Nicolas Lipovsky
                                        Telephone: (212) 723-6771

                                      -60-

<PAGE>

                                        Facsimile: (212) 723-8543

If to the Arrangers and Documentation
Agent:                                  Bank of America, N.A.
                                        Reforma 265 PH
                                        Mexico, F.F. 06500
                                        Attention: Jorge Rodriguez Garcia
                                        Telephone: 52-55-5230-6400
                                        Facsimile: 52-55-5230-6393

                                        with a copy to:
                                        Bank of America, N.A.
                                        Reforma 265 PH
                                        Mexico, F.F. 06500
                                        Attention: Bernardo Llereas
                                        Telephone: 52-55-5230-6400
                                        Facsimile: 52-55-5230-6393

                                        Comerica Bank
                                        Andres Bello #10 Piso 17
                                        Mexico D.F. c.p. 11560
                                        Attention: Osvaldo Rance
                                        Telephone: 52-55-5279-7308
                                        Facsimile: 52-55-5279-7318

                                        Landesbank Schleswig-Holstein
                                        Girozentrale, Kiel
                                        Martensdamm 8
                                        D-24103 Kiel, Germany
                                        Attention: Michael Munting
                                        Telephone: 31-10-205-2465
                                        Facsimile: 31-10-205-2466

                                        Standard Chartered Bank
                                        Paseo de las Palmas
                                        239-401
                                        Lomas de Chapultepec
                                        Mexico, D.F. 11000
                                        Attention: Juan Carlos Tamariz
                                        Telephone: 52-55-5387-1304
                                        Telecopy: 52-55-5387-1399

                                        with a copy to:
                                        Standard Chartered Bank
                                        1 Evertrust Plaza
                                        Jersey City, NJ 07302
                                        Attention: Larry Fitzgerald
                                        Telephone: 201-633-3442

                                      -61-

<PAGE>

                                        Telecopy: 201-536-0948

         SECTION 10.8.    Table of Contents; Descriptive Headings; etc. The
table of contents and descriptive headings of the several sections of this
Agreement are inserted for convenience only and shall not be deemed to affect
the meaning or construction of any of the provisions hereof.

         SECTION 10.9.    Survival of Agreements and Representations. All
covenants, agreements, representations and warranties made herein, in the Notes,
or in any certificate delivered pursuant hereto or thereto shall survive the
execution and delivery hereof and the Term Loans made hereunder.

         SECTION 10.10.   Benefit of Agreement; Assignment. This Agreement
shall be binding upon the Borrower, its successors and assigns, and shall inure
to the benefit of the Joint Lead Arrangers, the Arrangers, the Documentation
Agent, the Administrative Agent and the Banks and their respective successors
and assigns except that (a) the Borrower may not transfer or assign any or all
of its rights or obligations hereunder except with the unanimous consent of all
the Banks; (b) an assignment by a Bank of its Commitment, its Note and its Term
Loans can only be made to a bank or financial institution organized and licensed
under the laws of Mexico or a financial institution registered with the
Hacienda; and (c) no Bank may assign its Commitment, its Note and the Term Loans
made by such Bank and no Bank may make or cause to be made its Term Loans
hereunder through any other Person, except pursuant to an instrument of
assignment in substantially the form of Exhibit C (an "Assignment and
Acceptance") and with the consent of the Administrative Agent and the Borrower
(which consent (x) in each case shall not be unreasonably withheld, (y) in the
case of the Borrower, shall not be required in the case of an assignment to a
Person party to this Agreement or a branch, agency or Subsidiary thereof (a
"Bank Affiliate") or after the occurrence and during the continuance of an Event
of Default and (z) in the case of the Administrative Agent shall not be required
in the case of an assignment to a Bank Affiliate); provided, however, that (i)
the Borrower shall not be required to pay any further amounts pursuant to
Sections 2.11, 2.13 and 2.14 than would have been required to be paid but for
the transfer of such Bank's interest to a Bank Affiliate or the making of Term
Loans through another office or Subsidiary of such Bank, except as provided in
Section 2.13, (ii) any such assignment shall be in a minimum amount of
US$1,000,000 and (iii) the Assignee shall pay a fee of US$3,500 to the
Administrative Agent prior to the consummation of such assignment (other than an
assignment to a Bank Affiliate). Nothing herein shall prohibit any Bank from
pledging or assigning any Note to any Federal Reserve Bank in accordance with
applicable law and without compliance with the foregoing provisions of this
Section 10.10; provided, however, that such pledge or assignment shall not
release such Bank from its obligations hereunder.

         SECTION 10.11.   Participation. Notwithstanding the provisions of
Section 10.10, each Bank shall have the right from time to time to create and
sell one or more participations in its rights under this Agreement, its Note and
the Term Loans made by it to a bank or financial institution organized and
licensed under the laws of Mexico or a financial institution registered with the
Hacienda. Each Bank agrees to notify the Borrower as promptly as practicable of
the consummation of the sale of a participation in its rights under this
Agreement, its Note and the Term Loans made by it. No agreement or other
arrangement governing any such creation and sale (a "Participation Agreement")
shall confer upon the purchaser of such interest

                                      -62-

<PAGE>

(a "Participant") any right to contact, negotiate with or seek information from
the Borrower under this Agreement or such Bank's Note or to enforce this
Agreement or such Bank's Note against the Borrower directly, except as provided
below. Any Participation Agreement shall (a) prohibit the assignment or sale by
the Participant of any subparticipation interest and (b) permit the Bank to
consent to waivers, amendments, modifications or supplements of this Agreement
without the consent of the Participant, except in the case of waivers,
amendments or modifications extending the maturity of any Term Loan or Note in
respect of which such Participation was granted, or reducing the rate or
extending the time for payment of any installment of interest thereon or
reducing the principal thereof, or reducing the amount or basis of calculation
of any Fees to accrue in respect thereof. Notwithstanding the foregoing, any
Participant shall be entitled to the benefits of Sections 2.11, 2.13 and 2.14
pursuant to its Participation Agreement as if such Participant were a Bank named
herein, provided, however, that the Borrower shall not be required to pay any
further amounts pursuant to such Sections than would have been required to be
paid but for the sale to such Participant of such Participant's participation
interest.

         SECTION 10.12.   Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, the Administrative Agent and the Banks are
hereby authorized at any time and from time to time, without notice to the
Borrower (any such notice being expressly waived by the Borrower) and to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final, in any currency) at
any time held and other indebtedness at any time owing by the Administrative
Agent or the Banks to or for the credit or the account of the Borrower against
any and all of the obligations of the Borrower now or hereafter existing under
this Agreement or the Notes, irrespective of whether or not the Administrative
Agent or the Banks shall have made any demand hereunder and although such
obligations may be unmatured. Each of the Banks and the Administrative Agent
agrees promptly to notify the Borrower no later than five Business Days after
any such setoff and application; provided, however, that the failure to give
such notice shall not affect the validity of such setoff and application.

         SECTION 10.13.   SUBMISSION TO JURISDICTION; VENUE; SERVICE; WAIVER OF
JURY TRIAL. EACH OF THE PARTIES HERETO (AND ITS SUCCESSORS AND ASSIGNS) (i)
AGREE THAT ANY CLAIM, SUIT, ACTION OR PROCEEDING BROUGHT BY ANY PARTY OR
SUCCESSOR THERETO ARISING OUT OF THIS AGREEMENT OR ANY NOTE SHALL BE SUBJECT TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK OR THE UNITED STATES
DISTRICT COURT IN EACH CASE LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK
CITY, TO THE JURISDICTION OF ANY COMPETENT COURT IN THE PLACE OF ITS CORPORATE
DOMICILE AND TO APPELLATE COURTS THEREFROM AND EACH OF THE PARTIES HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO SUCH
JURISDICTION FOR SUCH PURPOSE AND (ii) TO THE FULLEST EXTENT PERMITTED BY LAW,
(A) IRREVOCABLY WAIVES ANY OBJECTION IT MAY HAVE AT ANY TIME TO THE LAYING OF
VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER PRINCIPAL DOCUMENT BROUGHT IN ANY SUCH COURT, (B)
IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH SUIT, ACTION OR

                                      -63-

<PAGE>

PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM;
AND (C) IRREVOCABLY WAIVES THE RIGHT TO OBJECT, WITH RESPECT TO SUCH CLAIM,
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT, THAT SUCH COURT DOES NOT
HAVE JURISDICTION OVER IT. EACH OF THE PARTIES HERETO HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES ALL RIGHTS OF JURISDICTION IN ANY SUCH ACTION OR PROCEEDING,
WHICH IT MAY NOW OR HEREAFTER BE AFFORDED BY LAW, IN ANY OTHER FORUM. EACH OF
THE PARTIES HERETO FURTHER AGREES THAT A FINAL JUDGMENT IN ANY SUCH SUIT, ACTION
OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY MANNER PROVIDED BY LAW. TO THE FULLEST EXTENT
PERMITTED BY LAW, EACH OF THE PARTIES HERETO (AND THEIR RESPECTIVE SUCCESSORS
AND ASSIGNS) WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT. FOR THE PURPOSE OF PROCEEDINGS IN THE COURTS OF THE STATE OF NEW YORK
AND THE UNITED STATES COURTS FOR THE SOUTHERN DISTRICT OF NEW YORK, IN EACH CASE
SITTING IN THE BOROUGH OF MANHATTAN, THE BORROWER HEREBY IRREVOCABLY DESIGNATES
AS OF THE EFFECTIVE DATE CT CORPORATION SYSTEM WITH OFFICES CURRENTLY LOCATED AT
111 EIGHTH AVENUE, NEW YORK, NEW YORK 10011 AS ITS AGENT FOR SERVICE OF PROCESS.
IN THE EVENT THAT SUCH AGENT OR ANY SUCCESSOR SHALL CEASE TO BE LOCATED IN THE
BOROUGH OF MANHATTAN, THE BORROWER SHALL PROMPTLY AND IRREVOCABLY BEFORE THE
RELOCATION OF SUCH AGENT FOR SERVICE OF PROCESS, IF PRACTICABLE, OR PROMPTLY
THEREAFTER DESIGNATE A SUCCESSOR AGENT, WHICH SUCCESSOR AGENT SHALL BE LOCATED
IN THE BOROUGH OF MANHATTAN, AND NOTIFY THE ADMINISTRATIVE AGENT THEREOF, TO
ACCEPT ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS OR OTHER DOCUMENTS WHICH MAY
BE SERVED IN ANY ACTION OR PROCEEDING IN ANY OF SUCH COURTS AND FURTHER AGREES
THAT SERVICE UPON SUCH AGENT SHALL CONSTITUTE VALID AND EFFECTIVE SERVICE UPON
THE BORROWER AND THAT FAILURE OF ANY SUCH AGENT TO GIVE ANY NOTICE OF SUCH
SERVICE TO THE BORROWER SHALL NOT AFFECT THE VALIDITY OF SUCH SERVICE OR ANY
JUDGMENT RENDERED IN ANY ACTION OR PROCEEDING BASED THEREON. EXCEPTING THE
BORROWER, EACH OF THE PARTIES HERETO AGREES THAT SERVICE OF ANY AND ALL SUCH
PROCESS OR OTHER DOCUMENTS ON SUCH PERSON MAY ALSO BE EFFECTED BY REGISTERED
MAIL TO ITS ADDRESS AS SET FORTH IN SECTION 10.7 OR SCHEDULE 1.1(b). WITH
RESPECT TO THE BORROWER, SERVICE, OF ANY AND ALL SUCH PROCESS OR OTHER DOCUMENTS
TO CT CORPORATION OR SUCH OTHER AGENT FOR SERVICE OF PROCESS DESIGNATED BY THE
BORROWER IN ACCORDANCE WITH THIS AGREEMENT, SERVICE OF PROCESS SHALL CONSTITUTE
VALID AND EFFECTIVE SERVICE ONLY IF MADE IN PERSON.

                                      -64-

<PAGE>

         SECTION 10.14.    Judgment Currency. All payments made under this
Agreement and the Notes shall be made in New York, New York to such account as
may be directed by the payee from time to time in United States Dollars, and, if
for any reason any payment made hereunder is made in a currency (the "Other
Currency") other than United States Dollars, then to the extent that the payment
actually received by the Banks, the Joint Lead Arrangers, the Arrangers, the
Documentation Agent or the Administrative Agent, when converted into United
States Dollars at the Rate of Exchange (as defined below) on the date of payment
(or, if conversion on such date is not practicable, as soon thereafter as it is
practicable for the Banks, the Joint Lead Arrangers, the Arrangers, the
Documentation Agent or the Administrative Agent to purchase United States
Dollars) falls short of the amount due under the terms of this Agreement or any
Note, the Borrower, shall, as a separate and independent obligation of the
Borrower, indemnify the Banks, the Joint Lead Arrangers, the Arrangers, the
Documentation Agent and the Administrative Agent and hold the Banks, the Joint
Lead Arrangers, the Arrangers, the Documentation Agent and the Administrative
Agent harmless against the amount of such shortfall. As used in this Section
10.14, the term "Rate of Exchange" means the rate at which the Banks, the Joint
Lead Arrangers, the Arrangers, the Documentation Agent or the Administrative
Agent are able on the relevant date to purchase United States Dollars with the
Other Currency and shall include any premiums and costs of exchange payable in
connection with the purchase of or conversion into, United States Dollars.

         SECTION 10.15.    Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by the different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute one
and the same instrument.

         SECTION 10.16.    Waiver of Immunities. To the extent that the Borrower
has or hereafter may acquire any immunity from jurisdiction of any court or from
any legal process (whether through service or notice, attachment prior to
judgment, attachment in aid of execution, execution or otherwise) with respect
to itself or its property, the Borrower hereby irrevocably waives such immunity
in respect of its obligations under this Agreement and the Notes. The foregoing
waiver is intended to be effective to the fullest extent now or hereafter
permitted by applicable law.

          SECTION 10.17.   Severability. To the fullest extent permitted by law,
any provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction, and the remaining portion of such provision and all
other remaining provisions hereof will be construed to render them enforceable.

          SECTION 10.18.   Confidentiality. Each of the Joint Lead Arrangers,
the Arrangers, the Documentation Agent, the Administrative Agent and each of the
Banks agrees that it will not disclose without the prior consent of the Borrower
(other than to its affiliates, employees, auditors or counsel or to another
Bank) any information with respect to the Borrower which is furnished pursuant
to this Agreement or any Note except that any such Person may disclose any such
information (a) as has become generally available to the public other than by a
breach by such Person of this Section 10.18, (b) as may be requested or required
by any

                                      -65-

<PAGE>

Governmental Authority having or claiming to have jurisdiction over such Person
(provided that such Person does not object to such body's claim of jurisdiction
over it) or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or elsewhere)
or their successors, (c) as may be required in response to any summons or
subpoena or any law, order, governmental direction, regulation or ruling
applicable to such Person, or (d) to any prospective participant or assignee in
connection with any contemplated transfer pursuant to Section 10.10 or Section
10.11, provided that such prospective transferee shall have been made aware of
this Section 10.18 and shall have agreed to be bound by its provisions as if it
were a party to this Agreement.

          SECTION 10.19.   No Waiver; Remedies. No failure on the part of the
Administrative Agent, the Joint Lead Arrangers, any Arranger, the Documentation
Agent or any of the Banks to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.

          SECTION 10.20.   Prior Agreements Superseded. As of the Effective
Date, this Agreement shall completely and fully supersede all prior undertakings
or agreements, both written and oral, between or among the Borrower, the Joint
Lead Arrangers, the Arrangers, the Documentation Agent, the Administrative Agent
and/or the Banks, relating to the acquisition by the Banks of their Commitments,
including, but not limited to, those contained in any mandate letter between the
Borrower and the Joint Lead Arrangers executed in anticipation of the
acquisition by the Banks of their Commitments but excluding the Fee Letters
referred to herein.

  [The remainder of page left blank intentionally; Signature page to follow.]

                                      -66-

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized representatives as of the date first above
written.

                                        TFM, S.A. DE C.V.,
                                        as Borrower

                                        By: /s/ Leon Ortiz
                                            -----------------------------
                                            Name: Leon Ortiz
                                            Title:

                                        By: /s/ Jacinto Marina Cortes
                                            -----------------------------
                                            Name: Jacinto Marina Cortes
                                            Title:






                                      -67-

<PAGE>

                                          JPMORGAN CHASE BANK,
                                          as Administrative Agent and as a Bank


                                          By:    /s/ Linda M. Meyer
                                              ---------------------------------
                                              Name:  Linda M. Meyer
                                              Title: Vice President


                                      -68-

<PAGE>

                                           Arrangers:


                                           BANK OF AMERICA, N.A.


                                           By:    /s/ Jean-Louis Goinohard
                                               --------------------------------
                                               Name:  Jean-Louis Goinohard
                                               Title: Managing Director


                                      -69-

<PAGE>

                                           COMERICA BANK


                                           By:    /s/ Josef C. Koberl
                                               ---------------------------------
                                               Name:  Josef C. Koberl
                                               Title: Vice President


                                      -70-

<PAGE>
                                           LANDESBANK SCHLESWIG-HOLSTEIN
                                           GIROZENTRALE, KIEL


                                           By:     /s/ Michiel Munting
                                               --------------------------------
                                               Name:   Michiel Munting
                                               Title:  Senior Vice President



                                           By:     /s/ Berthold Reuter
                                               --------------------------------
                                               Name:   Berthold Reuter
                                               Title:  Senior Vice President




                                      -71-

















<PAGE>

                                 STANDARD CHARTERED BANK, as Arranger
                                 and Documentation Agent



                                 By:     /s/ Monica Molina
                                     ------------------------------------------
                                     Name:   Monica Molina A2385
                                     Title:  Assistant Vice President



                                 By:     /s/ Fernando London
                                     ------------------------------------------
                                     Name:   Fernando London A157
                                     Title:  Vice President




                                      -72-

<PAGE>

                                 Banks:


                                 BBVA BANCOMER S.A.


                                 By:    /s/ Manuel A. Tigunaga Gomez del Campo
                                     -----------------------------------------
                                     Name:  Manuel A. Tigunaga Gomez del Campo
                                     Title: Director Banco Corporativa Local 1



                                 By:    /s/ Gregorio Merino Rendon
                                     ------------------------------------------
                                     Name:  Gregorio Merino Rendon
                                     Title: Director Banco Corporativa Local 11



                                      -73-

<PAGE>

                                           CITIBANK, N.A.

                                           By:    /s/ Jose Maria Urquiza
                                               --------------------------------
                                               Name:  Jose Maria Urquiza
                                               Title: Vice President



                                      -74-

<PAGE>

                                          EXPORT DEVELOPMENT CANADA


                                          By:    /s/ Peter Johnston
                                              --------------------------------
                                              Name:  Peter Johnston
                                              Title: Financial Services Manager



                                          By:    /s/ Coleen Lalonde
                                              --------------------------------
                                              Name:  Coleen Lalonde
                                              Title: Financial Services Manager



                                      -75-

<PAGE>


                                           WESTLB AG, NEW YORK BRANCH


                                           By:    /s/ Martin Frame
                                               --------------------------------
                                               Name:  Martin Frame
                                               Title: AD



                                           By:    /s/ Salvatore Battinelli
                                               --------------------------------
                                               Name:  Salvatore Battinelli
                                               Title: Managing Director
                                                      Credit Department




                                      -76-