** **

**Exhibit 2(b)(8)**

 

 

US$21,500,000

 

LOAN AGREEMENT

 

Dated as of October 16,2009

 

by and between

 

GRUMA, S.A.B. deC.V.,as the Borrower,

 

and

 

BARCLAYS BANK PLC,as Lender

 

 

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**TABLE OF CONTENTS**

 
| ** **  | ** **                                                                                | **Page** |
|-------------|-------------------------------------------------------------------------------------------|----------|
|        |                                                                                      |     |
| ARTICLE I   | DEFINITIONS                                                                               | 1        |
|        |                                                                                      |     |
| 1.01.       | Certain Defined Terms                                                                     | 1        |
| 1.02.       | Other Interpretive  Provisions                                                            | 31       |
| 1.03.       | Accounting Principles                                                                     | 32       |
|        |                                                                                      |     |
| ARTICLE II  | THE  LOAN                                                                                 | 32       |
|        |                                                                                      |     |
| 2.01.       | The Loan                                                                                  | 32       |
| 2.02.       | Evidence of  Indebtedness                                                                 | 32       |
| 2.03.       | Procedure for Making of  Loan                                                             | 33       |
| 2.04.       | Voluntary Prepayments                                                                     | 33       |
| 2.05.       | Mandatory Prepayments                                                                     | 33       |
| 2.06.       | Repayment of the Loan                                                                     | 36       |
| 2.07.       | Interest                                                                                  | 37       |
| 2.08.       | Computation of Interest  and Fees                                                         | 37       |
| 2.09.       | Payments by the Company                                                                   | 38       |
| 2.10.       | Promise to Pay                                                                            | 38       |
|        |                                                                                      |     |
| ARTICLE III | TAXES,  YIELD PROTECTION AND ILLEGALITY                                                   | 38       |
|        |                                                                                      |     |
| 3.01.       | Taxes                                                                                     | 38       |
| 3.02.       | Illegality                                                                                | 40       |
| 3.03.       | Inability to Determine  Rates                                                             | 41       |
| 3.04.       | Increased Costs and  Reduction of Return                                                  | 41       |
| 3.05.       | Funding Losses                                                                            | 41       |
| 3.06.       | Reserves on Loan                                                                          | 42       |
| 3.07.       | Certificates of the  Lender                                                               | 42       |
| 3.08.       | Change of Lending  Office                                                                 | 43       |
| 3.09.       | Substitution of Lender                                                                    | 43       |
| 3.10.       | Survival                                                                                  | 43       |
|        |                                                                                      |     |
| ARTICLE IV  | CONDITIONS  PRECEDENT                                                                     | 43       |
|        |                                                                                      |     |
| 4.01.       | Conditions to Closing  Date                                                               | 43       |
|        |                                                                                      |     |
| ARTICLE V   | REPRESENTATIONS  AND WARRANTIES                                                           | 48       |
|        |                                                                                      |     |
| 5.01.       | Corporate Existence and  Power                                                            | 48       |
| 5.02.       | Corporate  Authorization; No Contravention                                                | 48       |
| 5.03.       | No Additional  Authorizations                                                             | 49       |
| 5.04.       | Binding Effect                                                                            | 49       |
| 5.05.       | Litigation                                                                                | 49       |
| 5.06.       | Financial Information;  No Material Adverse Effect; No Default; No Contingent Liabilities | 49       |
| 5.07.       | Pari Passu                                                                                | 50       |
| 5.08.       | Taxes                                                                                     | 50       |
| 5.09.       | Environmental Matters                                                                     | 50       |

 

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**TABLE OF CONTENTS**

(continued)

 
| ** **  | ** **                                                                                    | **Page** |
|-------------|-----------------------------------------------------------------------------------------------|----------|
|        |                                                                                          |     |
| 5.10.       | Compliance with Social  Security Legislation, Etc                                             | 51       |
| 5.11.       | Assets; Patents;  Licenses; Insurance; Etc                                                    | 51       |
| 5.12.       | Subsidiaries                                                                                  | 52       |
| 5.13.       | Commercial Acts                                                                               | 52       |
| 5.14.       | Proper Legal Form                                                                             | 52       |
| 5.15.       | Full Disclosure                                                                               | 53       |
| 5.16.       | Investment Company Act                                                                        | 53       |
| 5.17.       | Margin Regulations                                                                            | 53       |
| 5.18.       | ERISA Compliance; Labor  Matters                                                              | 54       |
| 5.19.       | Anti-Terrorism Laws                                                                           | 55       |
| 5.20.       | Existing Indebtedness  and Reporto Contracts                                                  | 56       |
| 5.21.       | Hedging Policy                                                                                | 57       |
| 5.22.       | Collateral and  Guaranties Relating to Company Indebtedness                                   | 57       |
|        |                                                                                          |     |
| ARTICLE VI  | AFFIRMATIVE  COVENANTS                                                                        | 57       |
|        |                                                                                          |     |
| 6.01.       | Financial Statements  and Other Information                                                   | 57       |
| 6.02.       | Notice of Other Events                                                                        | 61       |
| 6.03.       | Maintenance of  Existence; Conduct of Business                                                | 62       |
| 6.04.       | Insurance                                                                                     | 62       |
| 6.05.       | Maintenance of  Governmental Approvals                                                        | 62       |
| 6.06.       | Use of Proceeds                                                                               | 62       |
| 6.07.       | Payment of Obligations                                                                        | 63       |
| 6.08.       | Ranking; Priority                                                                             | 63       |
| 6.09.       | Compliance with Laws                                                                          | 63       |
| 6.10.       | Maintenance of Books  and Records                                                             | 64       |
| 6.11.       | Intercompany Indebtedness                                                                     | 64       |
| 6.12.       | Further Assurances                                                                            | 65       |
|        |                                                                                          |     |
| ARTICLE VII | NEGATIVE  COVENANTS                                                                           | 65       |
|        |                                                                                          |     |
| 7.01.       | Negative Pledge                                                                               | 65       |
| 7.02.       | Investments                                                                                   | 67       |
| 7.03.       | Mergers,  Consolidations, Sales and Leases                                                    | 69       |
| 7.04.       | Restricted Payments                                                                           | 70       |
| 7.05.       | Other Agreements                                                                              | 70       |
| 7.06.       | Burdensome Agreements                                                                         | 70       |
| 7.07.       | Transactions with  Affiliates; Arm’s Length Transactions                                 | 71       |
| 7.08.       | No Subsidiary  Guarantees of Certain Indebtedness                                             | 71       |
| 7.09.       | Interest Coverage Ratio                                                                       | 71       |
| 7.10.       | Leverage Ratio                                                                                | 71       |
| 7.11.       | Limitations on Changes  to Constituent Documents, Indebtedness, Corporate Existence, Business | 72       |
| 7.12.       | Fundamental Changes, Limitations on Asset Sales,  Asset Exchanges and Acquisitions            | 72       |

 

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**TABLE OF CONTENTS**

(continued)

 
|         |                                                  | **Page** |
|--------------|-------------------------------------------------------|----------|
|         |                                                  |     |
| 7.13.        | Limitations on Sale  Lease-Back Transactions          | 74       |
| 7.14.        | Limitations on Capital  Expenditures                  | 74       |
| 7.15.        | Limitations on  Voluntary Prepayments of Indebtedness | 75       |
| 7.16.        | Limitations on  Incurrence of Additional Indebtedness | 75       |
| 7.17.        | Limitations on ERISA  Deficiencies                    | 77       |
| 7.18.        | Limitations on Hedging                                | 77       |
| 7.19.        | Intercompany  Indebtedness                            | 78       |
| 7.20.        | Material Subsidiaries                                 | 79       |
| 7.21.        | Reporto Contracts                                     | 79       |
| 7.22.        | Equity Issuances                                      | 79       |
|         |                                                  |     |
| ARTICLE VIII | EVENTS  OF DEFAULT                                    | 80       |
|         |                                                  |     |
| 8.01.        | Events of Default                                     | 80       |
| 8.02.        | Remedies                                              | 82       |
| 8.03.        | Rights Not Exclusive                                  | 83       |
|         |                                                  |     |
| ARTICLE IX   | MISCELLANEOUS                                         | 83       |
|         |                                                  |     |
| 9.01.        | Amendments and Waivers                                | 83       |
| 9.02.        | Notices                                               | 83       |
| 9.03.        | No Waiver; Cumulative  Remedies                       | 84       |
| 9.04.        | Costs and Expenses                                    | 84       |
| 9.05.        | Indemnification by the  Company                       | 85       |
| 9.06.        | Payments Set Aside                                    | 85       |
| 9.07.        | Successors and Assigns                                | 86       |
| 9.08.        | Assignments,  Participations, Etc                     | 86       |
| 9.09.        | Confidentiality                                       | 88       |
| 9.10.        | Set-off                                               | 88       |
| 9.11.        | Notification of  Addresses, Lending Offices, Etc      | 89       |
| 9.12.        | Counterparts                                          | 89       |
| 9.13.        | Severability                                          | 89       |
| 9.14.        | Governing Law                                         | 89       |
| 9.15.        | Consent to Jurisdiction;  Waiver of Jury Trial        | 89       |
| 9.16.        | Waiver of Immunity                                    | 90       |
| 9.17.        | Payment in US Dollars;  Judgment Currency             | 90       |
| 9.18.        | Change to IFRS                                        | 91       |

 

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| Schedule 1.01(b) | -      | Existing Material  Subsidiaries                                                       |
|------------------|--------|---------------------------------------------------------------------------------------|
| Schedule 1.01(c) | -      | Intercompany Revolving  Facilities                                                    |
| Schedule 5.05    | -      | Pending Litigation                                                                    |
| Schedule 5.06(c) | -      | Existing Material  Adverse Effects                                                    |
| Schedule 5.06(e) | -      | Material Contingent  Liabilities, Forward or Long-Term Commitments, Unrealized Losses |
| Schedule 5.09    | -      | Environmental Matters                                                                 |
| Schedule 5.11(d) | -      | Existing Sale  Lease-Back Transactions                                                |
| Schedule 5.12(a) | -      | Subsidiaries                                                                          |
| Schedule 5.12(b) | -      | Restrictive Subsidiary  Agreements                                                    |
| Schedule 5.20(a) | -      | Existing Indebtedness                                                                 |
| Schedule 5.20(b) | -      | Existing Intercompany  Indebtedness                                                   |
| Schedule 5.20(c) | -      | Existing Hedging  Agreements                                                          |
| Schedule 5.20(d) | -      | Existing Reporto  Contracts                                                           |
| Schedule 7.01    | -      | Existing Liens                                                                        |
| Schedule 7.02    | -      | Existing Investments                                                                  |
| Schedule 9.02    | -      | Notices                                                                               |
|             |   |                                                                                  |
| Exhibit A   | -      | Form of Promissory  Note                                                         |
| Exhibit B-1 | -      | Form of Quarterly  Compliance Certificate                                        |
| Exhibit B-2 | -      | Form of Annual  Compliance Certificate                                           |
| Exhibit C   | -      | Form of Assignment  and Acceptance                                               |
| Exhibit D   | -      | Form of Opinion of  Special Mexican Counsel to the Company                       |
| Exhibit E-1 | -      | Form of Opinion of  Special US Counsel to the Company                            |
| Exhibit E-2 | -      | Form of Opinion of  General Counsel to the Company                               |
| Exhibit F   |   | Form of  Intercompany Trust Agreement                                            |
| Exhibit G   | -      | Form of Notice of  Borrowing                                                     |
| Exhibit H   | -      | Form of Hedging  Policy                                                          |
| Exhibit I   |   | Form of  Intercompany Subordination Agreement                                    |

 

iv

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LOAN AGREEMENT

 

This LOAN AGREEMENT is entered into as of October 16, 2009, by andbetween GRUMA, S.A.B. de C.V., a *sociedadanónima bursátil de capital variable* organized under the laws ofMexico (together with its successors, the “Company”), and BARCLAYS BANKPLC, a public limited company with registered number 1026167 organized underthe laws of England and Wales (together with its successors and assigns, the “Lender”).  All capitalized terms used but not otherwisedefined have the meaning given to them in Section 1.01 (*Definitions*).

 

WHEREAS, the Company has requested that the Lender make or extendcredit to the Company in the form of the Loan to satisfy the TerminatedDerivative Obligation in an aggregate principal amount of US$21,500,000; and

 

WHEREAS, the Lender is prepared, on the terms and subject to theconditions hereinafter set forth (including Article IV), to make or extendsuch credit in the form of the Loan to the Company;

 

NOW, THEREFORE, in consideration of the mutual agreements, provisionsand covenants contained herein, the parties hereto agree as follows:

 

ARTICLEIDEFINITIONS

 

1.01.        CertainDefined Terms.  As used in this Agreement and in anySchedules and Exhibits to this Agreement, the following capitalized terms havethe following meanings:

 

“Acquisition Pro Forma” has the meaning set forth in Section 7.12(b)(vii)(B)(1) (*Fundamental Changes, Limitations on Asset Sales,Asset Exchanges and Acquisitions*).

 

“Administrative Questionnaire” means an administrative detailsform completed by the Lender.

 

“Advisor Fee Letters” means the (a) the Fee ReimbursementLetter, dated July 30, 2009, between the Company and CGSH, and (c) theFee Reimbursement Letter, dated September 14, 2009, between the Companyand White & Case S.C, in each case pursuant to which the Companyagreed to pay each Advisor for professional services and to reimburse suchAdvisor’s expenses as provided in each such Advisor Fee Letter.

 

“Advisors” means each of CGSH and White & Case S.C.

 

“Affected Lender” has the meaning specified in Section 3.02(a) (*Illegality*).

 

“Affiliate” means, as to any Person, any other Person that,directly or indirectly, is in control of, is controlled by or is under commoncontrol with such Person or is a director or Officer of such Person**.**

 

“Agreement” means this Loan Agreement, as from time to timeamended, supplemented, restated or otherwise modified.

 

1

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“Agreement Value” means, for each Hedging Agreement, on any dateof determination, the amount, if any, that would be payable by the Company orany of its Subsidiaries to the counterparty in such Hedging Agreement inaccordance with the terms of such Hedging Agreement, after taking into accountthe effect of any legally enforceable netting agreement relating to suchHedging Agreement (which, for the avoidance of doubt, shall net any amountsowed to the counterparty against any collateral consisting of cash or CashEquivalent Investments that was posted for the benefit of the counterparty inaccordance with such Hedging Agreement), as if (i) such Hedging Agreementwas being terminated early on such date of determination, (ii) both theCompany or Subsidiary and the counterparty were the “Affected Parties” and (iii) thehedge counterparty was the sole party determining such payment amount.  Any Agreement Value with respect to a HedgingAgreement shall be determined by the counterparty in such Hedging Agreement andprovided by such counterparty to the Company, or, if such counterparty does notdetermine the Agreement Value, the Agreement Value shall be calculated by theCompany and certified to such counterparty and the Lender.

 

“Alternate Base Rate” means, for any day, a fluctuating rate ofinterest per annum equal to the higher of (a) the rate of interest mostrecently announced by the Lender as its “prime rate” and (b) the FederalFunds Rate most recently determined by the Lender plus one half of one percent(0.50%).  The “prime rate” is a rate setby the Lender based upon various factors, including the Lender’s costs anddesired return, general economic conditions and other factors, and is used as areference point for pricing some loans, which may be priced at, above, or belowsuch announced rate.  Any change in suchrate announced by the Lender shall take effect at the opening of business onthe day specified in the public announcement of such change.

 

“Alternate Process Agent” has the meaning specified in Section 9.15(d) (*Consent to Jurisdiction; Waiver of Jury Trial*).

 

“Annual Compliance Certificate” means a certificatesubstantially in the form of Exhibit B-2.

 

“Anti-Terrorism Laws” has the meaning specified in Section 5.19(a) (*Anti-Terrorism Laws*).

 

“Applicable Margin” means from (and including) the date hereof,through the date on which all outstanding amounts hereof are paid, a percentageper annum equal to 2.875%.

 

“Asset Sale” shall have the meaning ascribed to such term in theMajor Derivative Counterparty Loan, as of the date hereof.

 

“Assignee” has the meaning specified in Section 9.08(a) (*Assignments, Participations, Etc.*).

 

“Assignment and Acceptance” has the meaning specified in Section 9.08(a) (*Assignments, Participations, Etc.*).

 

“Attorney Costs” means and includes all reasonable and documentedfees and disbursements of any law firm or other external counsel, and, without duplication, the****reasonable 

 

2

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allocated cost of internallegal services and all reasonable and documented disbursements of internalcounsel.

 

“Attributable Debt” means, withrespect to a Sale Lease-Back Transaction, as of the date of determination, thegreater of (a) the fair market value of the Property being sold ortransferred and (b) the present value (discounted at the interest rateimplicit in the terms of the lease, compounded annually) of the totalobligations of the lessee for rental payments during the remaining term of thelease included in such transaction (including any period for which such leasehas been extended).

 

“Available Excess Cash Amount” means,with respect to any Excess Cash Year, the amount of Excess Cash (if any) fromsuch Excess Cash Year that is not required to be applied to the mandatoryrepayment of Mandatory Prepayment Indebtedness thereunder.

 

“Bancomext Loan” means the loan provided pursuant to the *Contrato de Apertura de Crédito Simple*,dated on or prior to the date hereof, as amended from time to time inaccordance with the provisions of this Agreement, between the Company and BancoNacional de Comercio Exterior, S.N.C.

 

“Bancomext-Gimsa Loan” means the US$30,000,000 loan providedpursuant to the Contrato de Aperatura de Crédito Simple dated as of April 3,2009, between Gimsa and Banco Nacional de Comercio Exterior, S.N.C.

 

“Bank of America Facility” means the Credit Agreement, dated asof October 30, 2006, by and among Bank of America N.A., as AdministrativeAgent, the Documentation Agent and L/C Issuer party thereto, the other lendersparty thereto and Gruma Corp.

 

“Banorte Shares” means the shares of capital stock of GrupoFinanciero Banorte S.A.B. de C.V. owned by the Company and its Subsidiaries.

 

“BBVA Loan” means the loans provided pursuant to theUS$197,000,000 Loan Agreement, dated on or about the date hereof, as amendedfrom time to time, by and among the Company, BBVA Securities Inc., BBVABancomer S.A., Institución de Banca Múltiple, Grupo Financiero BBVA Bancomer,and the several lenders party thereto.

 

“Breakage Event” has the meaning specified in Section 3.05(a) (*Funding Losses*).

 

“Business Day” means any day other than a Saturday, Sunday orday on which commercial banks in New York City, New York, London, England orMexico City, Mexico are authorized or required by law to close; provided,however, with respect only to any determination of LIBOR, the term “BusinessDay” shall also exclude any day on which banks are not open for dealings in USDollar deposits in the London interbank market.

 

“CapEx Report” has the meaning specified in Section 6.01(c)(iv) (*Financial Statements and Other Information*).

 

“Capital Adequacy Regulation” means any general guideline,request or directive of any central bank or other Governmental Authority, orany other law rule or regulation, whether or not 

 

3

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having the force of law, in each case, regardingcapital adequacy of any bank or of any corporation controlling a bank.

 

“Capital Expenditures”means, for any period, without duplication, anyexpenditures or written commitments of the Company and its Subsidiaries (otherthan Subsidiaries that are part of the Venezuelan Division) (a) for fixed or capital assets (including renewals, improvements, replacements,repairs and maintenance)that, in accordance with Mexican GAAP, are (or should be) classified as capitalexpendituresand that are (or should be) set forth ina consolidated statement of cash flows of the Company for such period preparedin accordance with Mexican GAAP and (b) pursuant to Capital LeaseObligations of the Company and its Consolidated Subsidiaries during suchperiod; provided that the term “Capital Expenditures” shall not includeany expenditures made with (i) the portion of Net Cash Proceeds of anAsset Sale that is invested in the Company’s Core Business in accordance withand as permitted by Section 2.05(a) (*MandatoryPrepayments*) or (ii) that portion of the Net Cash Proceeds of aCasualty Event that are used to Restore the affected Properties during theReinvestment Period in accordance with and as permitted by Section 2.05(b) (*Mandatory Prepayments*).

 

“CapitalLease Obligations” of any Person means the obligations of suchPerson to pay rent or other amounts under any lease of (or other arrangementconveying the right to use) real or personal property, or a combinationthereof, which obligations are required to be classified and accounted for ascapital leases on a balance sheet of such Person under Mexican GAAP (or, in thecase of Persons organized under laws of any other jurisdiction, the applicableGAAP therein), and the amount of such obligations shall be the capitalizedamount thereof determined in accordance with Mexican GAAP (or, in the case ofPersons organized under laws of any other jurisdiction, the applicable GAAPtherein).

 

“Cash Equivalent Investment” means, at any time:

 

(a)           any direct obligation of (orunconditionally guaranteed by) the United States of America or a state thereof,any OECD country or other foreign government in a jurisdiction in which theCompany or any of its Subsidiaries currently has or could have operations (orany agency or political subdivision thereof, to the extent such obligations aresupported by the full faith and credit of the United States of America or a state thereof, any OECD country orother foreign government in a jurisdiction in which the Company or any of itsSubsidiaries currently has or could have operations) maturing not more than oneyear after such time; and

 

(b)           any insured certificate of deposit, time deposit or bankers acceptance,maturing not more than one year after its date of issuance, which is issued byany commercial bank that is a lender or a member of the US Federal Revenue System, is organized under the laws of theUnited States or any State (or the District of Columbia) thereof and has (x) acredit rating of A2 or higher from Moody’s or A or higher from S&P and (y) acombined capital and surplus greater than US$500,000,000.

 

“Casualty Certificate” means, with respect to a Casualty Event,a certificate signed by a Senior Officer of the Company stating that within theReinvestment Period, all or a portion of any Net Cash Proceeds received as aresult of such Casualty Event (but in no event more than (i) US$10,000,000(or the US Dollar Equivalent thereof) without the consent of the holders ofmore 

 

4

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than 50% of the then aggregate oustanting principalamount of the Major Derivative Counterparty Loan and (ii) US$55,000,000(or the US Dollar Equivalent thereof)) shall be used to Restore any Propertiesin respect of which such Net Cash Proceeds were paid (which certificate shallset forth in reasonable detail an estimate of the Net Cash Proceeds to be soexpended).

 

“Casualty Event” shall have the meaning ascribed to such term inthe Major Derivative Counterparty Loan, as of the date hereof.

 

“Central America Division” means Gruma Centroamerica LLC andGruma de Guatemala S.A. together with each of their respective direct andindirect Subsidiaries.

 

“CGSH” means Cleary Gottlieb Steen and Hamilton LLP, special NewYork counsel to the Initial Lender.

 

“Change in Control” means the occurrence of anyof the following: (a) Mr. Roberto Gonzalez Barrera, his familymembers (including his former spouse, his siblings and other linealdescendants, estates and heirs, or any trust or other investment vehicle forthe primary benefit of any such Person or their respective family members orheirs) (collectively the “Controlling Stockholder”) shall fail to own,directly or indirectly, beneficially and of record, shares (or AmericanDepositary Receipts representing shares) representing at least 35% of theaggregate ordinary voting power and economic rights represented by the issuedand outstanding capital stock of the Company; (b) the ControllingStockholder shall cease to have the unconditional right (including the rightwithout the consent or approval of any other Person), or shall fail, tonominate a majority of the board of directors of the Company and the chairmanof the board of directors of the Company; or (c) any change in control (orsimilar event, however denominated) with respect to the Company shall occurunder and as defined in any indenture or agreement in respect of Indebtednessto which the Company or any of its Subsidiaries is a party.

 

“Closing Date” means the date on which all conditions precedentset forth in Article IV (*ConditionsPrecedent*) are satisfied or waived in writing by the Lender.

 

“Code” means the Internal Revenue Code of 1986, as amended fromtime to time.

 

“Collateral Agency and Intercreditor Agreement” means theCollateral Agency and Intercreditor Agreement, dated as of the Closing Date, byand among the Collateral Agent, Deutsche Bank Trust Company Americas in itscapacity as administrative agent for the Major Derivative Counterparties, BBVABancomer, S.A., Institución de Banca Múltiple, Grupo Financiero BBVA Bancomerin its capacity as administrative agent for the lenders under the BBVA Loan,and solely with respect to certain sections thereof, the Company.

 

“Collateral Agent” has the meaning specified in the CollateralAgency and Intercreditor Agreement.

 

“Company” has the meaning specified in the introductory clausehereto.

 

“Company Refinancing Indebtedness”means Indebtedness incurred to Refinance the Other Prepayment Indebtedness orthe Bancomext Loan.

 

5

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“Confirmation” means the termination transaction entered into onJune 26, 2009 between the Company and the Initial Lender pursuant to whichthe Terminated Derivative Obligation between the Company and the Initial Lenderarose.

 

“Consolidated EBITDA” means, for anyMeasurement Period, for the Company and its Consolidated Subsidiaries, anamount equal to (a) the sum, without duplication, of (i) consolidatedoperating income (determined in accordance with Mexican GAAP) for suchMeasurement Period, (ii) the amount of depreciation and amortizationexpense deducted during such Measurement Period in determining suchconsolidated operating income, (iii) any other non-cash expenses deductedduring such Measurement Period in determining such consolidated operating incomeof the Company and its Consolidated Subsidiaries for such Measurement Period , (iv) anycash dividends or other cash distributions or payments received from GrupoFinanciero Banorte S.A.B. de C.V. during such Measurement Period, and (v) anycash dividends or other cash distributions or payments received (directly orindirectly) from the Venezuelan Subsidiaries during such Measurement Period *minus* (b) the sum, withoutduplication, of (i) Venezuelan EBITDA for such Measurement Period, (ii) anyother non-cash income included in the calculation of consolidated operatingincome of the Company and its Consolidated Subsidiaries for such MeasurementPeriod, and (iii) any cash payments made to any Subsidiary that is part ofthe Venezuelan Division during such Measurement Period; provided that in making the foregoing calculations (otherthan in respect of the calculation of Excess Cash), pro forma effect will begiven to the acquisition or Disposition of Persons, divisions or lines ofbusinesses by the Companyor any Subsidiary (other than any Subsidiary that is part of the VenezuelanDivision) of the Company that have occurred since the beginning of such Measurement Period as if suchevents had occurred, and, in the case of any Disposition, the proceeds thereofapplied, in each case including any incurrence or assumption of Indebtedness inconnection therewith, on the first day of such Measurement Period.

 

“Consolidated Interest Charges” means, for any MeasurementPeriod, the Interest Charges of the Company and its Consolidated Subsidiariesdetermined on a consolidated basis; provided that Consolidated InterestCharges shall not include any Interest Charges incurred by the VenezuelanDivision with respect to Venezuelan Non-Recourse Indebtedness.

 

“Consolidated Subsidiary” means (i) with respect to theCompany, any Subsidiary or other entity the accounts of which would, underMexican GAAP, be consolidated with those of the Company in the consolidatedfinancial statements of the Company, and (ii) at any date with respect toany other Person, any Subsidiary or other entity the accounts of which would beconsolidated with those of such Person in the consolidated financial statementsof such Person as of such date.

 

“Contractual Obligation” means, as to any Person, any provisionof any security issued by such Person or of any agreement, undertaking,contract, indenture, mortgage, deed of trust or other instrument, document oragreement to which such Person is a party or by which it or any of its Propertyis bound.

 

“Control” means the possession, directly or indirectly, of thepower to direct or cause the direction of the management or policies of aPerson, whether through the ability to exercise 

 

6

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voting power, by contract or otherwise.  “Controlling” and “Controlled”have meanings correlative thereto.

 

“Control Agreement” means the Control Agreement, dated on orabout the date hereof, by and between Gruma and the Initial Lender.

 

“Conversion Rate” means, as of anydate, the Peso/US Dollar exchange rate published by Banco de México in theFederal Official Gazette of Mexico (*DiarioOficial de la Federación*) as the rate “*para solventar obligaciones denominadas en moneda extranjera pagaderasen la República Mexicana*” as of such date (which rate is availableprior to 12:00 p.m. Mexico City time at http://www.banxico.org.mx/indicadores/fix.html (or any successor website thereto)); providedthat, if Banco de México ceases to publish such exchange rate, the ConversionRate shall equal the average of the Peso/ US Dollar exchange rates published byeither Bloomberg or Reuters (or the main offices of their subsidiaries locatedin Mexico, if not published by those institutions) on the relevant calculationdate.

 

“Core Business” means, with respect tothe Company and its Subsidiaries, (i) the production and distribution ofcorn flour, the production and distribution of tortillas and other relatedproducts, the production and distribution of wheat flour and any other food(including snacks) related business in which the Company and its Subsidiariesare engaged in, or may engage in, from time to time (for the purposes of thisdefinition, the “Food Business”) and (ii) businesses reasonablyancillary thereto, but only to the extent that such ancillary businesses are ofa nature, and of a size no greater than, reasonably necessary to serve orsupply the Food Business.

 

“Default” means any event or circumstance that, alone or with the giving of notice, the lapse of time, themaking of a determination, or any combination thereof, would (if not cured,waived or otherwise remedied during such time) constitute an Event of Default.

 

“Disposition” and correspondingly to “Dispose” means thesale, issuance, exchange, conveyance, assignment, license, other disposition(including any Sale Lease-Back Transaction) or other transfer (including by way of a merger or consolidation) ofany Property by any Person, including (i) any sale, issuance, exchange,conveyance, assignment, other disposition or other transfer of capital stock of any Person that was issuedand outstanding on the date of such sale, issuance, exchange, conveyance,assignment, other disposition or othertransfer and (ii) any sale, issuance, exchange, conveyance,assignment, license, other disposition orother transfer (including by way of a merger or consolidation) with orwithout recourse, of any notes or accounts receivable or any rights and claimsassociated therewith.

 

“Dollar Amount” means, at any date, with respect to anyMandatory Prepayment Indebtedness or Other Prepayment Indebtedness (i) denominatedin US Dollars, the outstanding principal amount of such Mandatory PrepaymentIndebtedness or Other Prepayment Indebtedness on such date, and (ii) denominatedin Pesos, the amount of US Dollars that would result from the conversion of thethen-outstanding principal amount of such Mandatory Prepayment Indebtedness orOther Prepayment Indebtedness into US Dollars at the Conversion Rate as of suchdate.

 

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“EBITDA” means for any period of four (4) consecutivefiscal quarters, with respect to any Person, an amount equal to (a) thesum, without duplication, of (i) operating income (determined inaccordance with the applicable GAAP) for such period, (ii) the amount ofdepreciation and amortization expense deducted during such period indetermining such operating income, (iii) any other non-cash expensesdeducted in determining such operating income during such period minus (b) anyother non-cash income included in determining such operating income during suchperiod.

 

“Environmental Laws” means all federal, national, state,provincial, departmental, municipal, local and foreign laws, including commonlaw, statutes, rules, regulations, treaties, ordinances,*normas técnicas* (technicalstandards) and codes, together with all orders, decrees, judgments, directives, orders (including consent orders) or injunctions issued, promulgated,approved or entered thereunder by any Governmental Authority having jurisdictionover the Company, any of its Subsidiaries or their respective properties, ineach case relating to environmental or health and safety matters.

 

“Equity Issuance” means any issuanceof capital stock of the Company or any Subsidiary in a primary offering by theCompany or such Subsidiary.

 

“ERISA” means the Employee Retirement Income Security Act of1974 as amended, and any successor statute thereto, as interpreted by therules, and regulations thereunder, all as the same may be in effect from timeto time.  References to sections of ERISAshall be construed also to refer to any successor sections.

 

“ERISA Affiliate” means any trade or business (whether or notincorporated) under common control with the Company within the meaning of Section 4001(a)(14)of ERISA, or any member of a group that includes the Company and that istreated as a single employer under Section 414(b) or (c) of theCode (and Sections 414(m) and (o) of the Code for purposes ofprovisions relating to Section 412 of the Code).

 

“ERISA Event” means any of the following: (a) a ReportableEvent with respect to a Pension Plan; (b) a withdrawal by the Company orany ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISAduring a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) ofERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) ofERISA; (c) a complete or partial withdrawal by the Company or any ERISAAffiliate from a Multiemployer Plan or notification that a Multiemployer Planis in reorganization; (d) the filing of a notice of intent to terminate aPlan under Section 4041 or 4041A of ERISA, or the commencement ofproceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) anevent or condition which might reasonably be expected to constitute groundsunder Section 4042 of ERISA for the termination of, or the appointment of,a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) theimposition of any liability under Title IV of ERISA (including as a result ofthe operation of Section 4069 or Section 4212 of ERISA), other thanPBGC premiums due but not delinquent under Section 4007 of ERISA, upon theCompany or any ERISA Affiliate.

 

“Eurocurrency Liabilities” has the meaning specified in Section 3.06(*Reserves on Loan*).

 

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“Event of Default” has the meaning specified in Section 8.01(*Events of Default*).

 

“Excess Cash” shall have the meaning ascribed to such term inthe Major Derivative Counterparty Loan, as of the date hereof.

 

“Excess Cash Year” means any Fiscal Year during which there isan amount of Excess Cash greater than zero.

 

“Excluded Taxes” means income, real property, franchise orsimilar taxes imposed on the Lender by a jurisdiction as a result of the Lenderbeing organized under the laws of such jurisdiction or being a resident of suchjurisdiction to which income under this Agreement is attributable or having apermanent establishment in such jurisdiction or its Lending Office beinglocated in such jurisdiction.

 

“Executive Order” has the meaning specified in Section 5.19(a) (*Anti-Terrorism Laws*).

 

“ExistingIndebtedness” means Indebtedness of the Company and its Subsidiaries thatwas outstanding on the date hereof and listed on Schedule 5.20(a) (*Existing Indebtedness*); providedthat Existing Indebtedness shall include the amount of any undrawn commitmentsunder the Bank of America Facility.

 

“ExistingIntercompany Indebtedness” means Intercompany Indebtedness that wasoutstanding as of September 30, 2009.

 

“ExistingOther Indebtedness” has the meaning specified in Section 5.20(a) (*Existing Indebtedness and Reporto Contracts*).

 

“ExistingVenezuelan Sale” means the sale of a 40% stake in Valores Mundiales, S.L.on the terms and subject to the conditions of the Purchase Agreement betweenRotch Energy Holdings N.V. and the Company, dated as of April 6, 2006,pursuant to which Rotch Energy Holdings N.V. agreed to pay the CompanyUS$39,600,000 through but excluding the Closing Date, and US$26,000,000thereafter.

 

“ExistingWorking Capital Indebtedness” has the meaning specified in Section 5.20(a) (*Existing Indebtedness**and Reporto Contracts*).

 

“ExistingSale Lease-Back Transactions” has the meaning specified in Section 5.11(d) (*Assets; Patents; Licenses; Insurance; Etc.*).

 

“Expropriate”means, with respect to any Property, to nationalize, seize or expropriate such Property, or,if such Property is a business, to assume control of the business andoperations of such Property by nationalization, seizure or expropriation.

 

“FederalFunds Rate” means, for any day, the rate per annum equal to the weightedaverage of the rates on overnight Federal funds transactions with members ofthe Federal Reserve System arranged by Federal funds brokers on such day, aspublished by the Federal Reserve Bank on the Business Day next succeeding suchday; provided that (a) if such day is not a Business Day, theFederal Funds Rate for such day shall be such rate on such transactions on 

 

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the next preceding Business Day as so published on the next succeedingBusiness Day, and (b) if no such rate is so published on such nextsucceeding Business Day, the Federal Funds Rate for such day shall be the averagerate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) chargedto the Lender on such day on such transactions as determined by the Lender.

 

“Fiscal Quarter” means a period of three (3) consecutivecalendar months ending on March 31, June 30, September 30 or December 31.

 

“Fiscal Year” means any period of twelve (12) consecutivecalendar months ending on December 31.

 

“Foreign Financial Institution” means a bank or financialinstitution (i) registered in BookI (*Libro I*), Section 1 (*Sección 1*) of the Foreign Banks, FinancialEntities, Pension and Retirement Funds and Investment Funds Registry (*Registro de Bancos, Entidades de Financiamiento,Fondos de Pensiones y Jubilaciones y Fondos de Inversión del Extranjero*)maintained by Hacienda for purposes of Rule II.3.13.1 of the *ResoluciónMiscelánea Fiscal* for the year 2009 and Article 195-I ofthe *Ley delImpuesto Sobre la Renta* (or any successor provisions thereof), (ii) which is a resident (or, if such entity islending through a branch or agency, the principal office of which is aresident) for tax purposes in ajurisdiction with which Mexico has entered into a treaty for theavoidance of double-taxation which is in effect, and (iii) which is the effective beneficiary (*beneficiario efectivo*) of any interestpaid hereunder or under the Note.

 

“ForeignPension Plan” means any benefit plan, other than a Pension Plan orMultiemployer Plan, that under any Requirement of Law is required to be fundedthrough a trust or other funding vehicle other than a trust or funding vehiclemaintained exclusively by a Governmental Authority.

 

“Funding Losses” has the meaning specified in Section 3.05(a) (*Funding Losses*).

 

“GAAP” means generally accepted accounting practices.

 

“Gimsa” means Grupo Industrial Maseca, S.A.B. de C.V., a *sociedad anónima bursátil de capital variable*organized under the laws of Mexico.

 

“Gimsa Division” means Gimsa together with its direct andindirect Subsidiaries.

 

“Governmental Authority” means, with respect to any Person, anynation or government, any state, municipality, province or other political oradministrative subdivision thereof, any central bank (or similar monetary orregulatory authority) thereof, any entity or branch of power exercisingexecutive, legislative, judicial, regulatory or administrative functions of orpertaining to government, and any corporation or other entity exercising suchfunctions and owned or controlled, through stock or capital ownership orotherwiseby any of the foregoing, any arbitral bodies, or any self-regulatory organization,asserting jurisdictionover such Person.

 

“Gruma Corp.” means Gruma Corporation, a corporation organizedunder the laws of Nevada.

 

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“Gruma Corp. Division” means Gruma Corp. together with itsdirect and indirect Subsidiaries.

 

“Guaranty Obligation” means, as to any Person: (a) anyobligation, contingent or otherwise, of such Person guarantying or having theeconomic effect of guarantying any Indebtedness or other obligation payable orperformable by another Person (the “primary obligor”) in any manner, whetherdirectly or indirectly, and including an *aval*and any obligation of such Person, direct or indirect, (i) to purchase orpay (or advance or supply funds for the purchase or payment of) suchIndebtedness or other obligation, (ii) to purchase or lease property,securities or services for the purpose of assuring the obligee in respect ofsuch Indebtedness or other obligation of the payment or performance of suchIndebtedness or other obligation, (iii) to maintain working capital,equity capital or any other financial statement condition or liquidity of theprimary obligor so as to enable the primary obligor to pay such Indebtedness orother obligation, or (iv) entered into for the purpose of assuring in anyother manner the obligees in respect of such Indebtedness or other obligationof the payment or performance thereof or to protect such obligees against lossin respect thereof (in whole or in part); or (b) any Lien on any Propertyof such Person securing any Indebtedness or other obligation of any otherPerson, whether or not such Indebtedness or other obligation is assumed by suchPerson; provided that the term “Guaranty Obligation” shall not includeendorsements of instruments for deposit or collection in the Ordinary Course ofBusiness.  The amount of any GuarantyObligation shall be deemed to be an amount equal to the stated or determinableamount of the related primary obligation, or portion thereof, in respect ofwhich such Guaranty Obligation is made or, if not stated or determinable, themaximum reasonably anticipated liability in respect thereof as determined bythe guarantying Person in good faith.

 

“Hedging Agreements” means any agreements or instruments inrespect of interest rate or currency swap, exchange or hedging transactions orother financial derivatives transactions.

 

“Hedging Policy” means the policy of the Company and itsSubsidiaries with respect to Hedging Agreements, a copy of which is attached asExhibit H, as amended from time to time with the approval of theBoard of Directors of the Company (or of a committee duly delegated by suchBoard of Directors comprised of two or more members thereof) in accordance withSection 7.18(b)(iii) (*Limitationson Hedging*).

 

“IFRS” means International Financial Reporting Standards asadopted by the International Accounting Standards Board.

 

“IFRS Amendments” has the meaning specified in Section 9.18 (*Change to IFRS*).

 

“IMSS” means the *Instituto Mexicano del Seguro Social*ofMexico.

 

“Indebtedness” of any Person means at any date, withoutduplication:

 

(a)           any obligation of such Person in respectof borrowed money or with respect to deposits of any kind (if any) and anyobligation of such Person evidenced by bonds, notes, debentures or similarinstruments;

 

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(b)           any obligation of such Person in respectof a lease, including Capital Lease Obligations, or hire purchase contract, ineach case, that would, under Mexican GAAP (or, in the case of Persons organizedunder laws of any other jurisdiction, the applicable GAAP therein), be treatedas a financial or capital lease,including all Attributable Debt of such Person in respect of Sale Lease-BackTransactions of such Person;

 

(c)           any obligation of others secured by (orfor which the holder of such obligation has an existing right, contingent orotherwise to be secured by) a Lien on any Property of such Person, whether ornot such obligation is assumed by such Person;

 

(d)           any obligations of such Person to pay thedeferred purchase price of Property or services if such deferral extends for aperiod in excess of sixty (60) days;

 

(e)           any Guaranty Obligations of such Personwhich could require such Person to make a payment;

 

(f)            the Agreement Value of any HedgingAgreements;

 

(g)           any obligations of such Person upon whichinterest charges are paid or accrued or are customarily paid or accrued;

 

(h)           any obligations of such Person underconditional sale or other title retention agreements relating to Propertypurchased by such Person;

 

(i)            any obligations of such Person topurchase, redeem, retire, defease or otherwise make any payment (other thandividend payments by Subsidiaries of the Company made pursuant to Section 7.04(a) (*Restricted Payments*)) in respect of anycapital stock of such Person or any other Person or any warrants, rights oroptions to acquire such equity interests, valued, in the case of redeemablepreferred interests, at the greater of its voluntary or involuntary liquidationpreference plus accrued and unpaid dividends;

 

(j)            any obligations of such Person as anaccount party in respect of letters of credit;

 

(k)           any obligations of such Person in respectof bankers’ acceptances, bank guaranties, surety bonds and similar instruments;and

 

(l)            any Probable Bonds for or in connectionwith liabilities arising from Proceedings in which such Person is involved;

 

provided, however, that the followingliabilities shall be explicitly excluded from the definition of the term “Indebtedness”:

 

(i)            trade accounts payable that are (x) less thansixty (60) days overdue or (y) being contested in good faith byappropriate proceedings and for which adequate reserves have been provided inaccordance with Mexican GAAP (or, in the case of Persons organized under lawsof any other jurisdiction, the applicable GAAP therein), in each case includingany obligations in respect of letters of credit (and any other similar guarantyinstruments) that have been issued in support of such trade accounts payable;

 

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(ii)           operating expenses that accrue and become payable inthe Ordinary Course of Business;

 

(iii)          customer advance payments and customer depositsreceived in the Ordinary Course of Business;

 

(iv)          obligations for ad valorem taxes, value added taxes,or any other taxes or governmental charges; and

 

(v)           Reporto Contracts that are entered into in accordancewith Section 7.21 (*Reporto Contracts*)and any Guaranty Obligations in respect thereof.

 

“Indemnified Liabilities” has the meaning specified in Section 9.05(*Indemnification by the Company*).

 

“Indemnified Taxes” means Taxes imposed on or incurred by theLender with respect to any payment under any Loan Document other than ExcludedTaxes.

 

“Indemnitees” has the meaning specified in Section 9.05 (*Indemnification by the Company*).

 

“INFONAVIT” means *InstitutoNacional del Fondo de la Vivienda para los Trabajadores*of Mexico.

 

“Information” has the meaning specified in Section 9.09(a) (*Confidentiality*).

 

“Initial Lender” means Barclays Bank PLC.

 

“Intercompany Indebtedness” means any present or futureIndebtedness of the Company or any of its present or future Subsidiaries issuedto the Company or any of its other present or future Subsidiaries.

 

“Intercompany Indebtedness Capitalization”means any amount owed to any Intercompany Lender pursuant to an IntercompanyRevolving Facility being satisfied in any manner other than by payment of suchamount to such Intercompany Lender in immediately available funds pursuant tothe terms of such Intercompany Revolving Facility.

 

“Intercompany Lenders” means theCompany and any of its Subsidiaries that are lenders under the IntercompanyRevolving Facilities.

 

“Intercompany Revolving Facilities”means, as amended from time to time in accordance with this Agreement, theintercompany revolving facilities listed on Schedule 1.01(c) (*Intercompany Revolving Facilities*).

 

“Intercompany Subordination Agreement” means the SubordinationAgreement, dated on or about the date hereof, by and among the Company and theIntercompany Lenders attached hereto as Exhibit I.

 

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“Intercompany Trust Agreement” meansthe Irrevocable Administration Trust Agreement (*Contrato de Fideicomiso Irrevocable de Administración con Derechos deReversión*), substantially in the form of Exhibit F,pursuant to which all Intercompany Lenders’ (other than Subsidiaries in theGimsa Division) rights, title and interest in, to and under the IntercompanyRevolving Facilities (as amended), dated on or about the date hereof, aretransferred to the Trustee, as trustee, with The Bank of New York Mellon, asbeneficiary in the first place (*fideicomisarioen primer lugar).*

 

“Interest Charges” means, with respect to any Person or Persons,and during any Measurement Period, the sum of (a) all interest, premiumpayments, debt discount, fees, charges and related expenses of such Person orPersons during such Measurement Period, in each case to the extent treated asinterest in accordance with Mexican GAAP, (b) any interest, premiumpayments, debt discount, fees, charges and related expenses in respect ofIndebtedness of such Person or Persons accruedor capitalized (whether or not actually paid during such MeasurementPeriod) plus the net amount payable (orminus the net amount receivable) under Hedging Agreements relating to suchinterest during such Measurement Period (whether or not actually paid orreceived during such Measurement Period), (c) the portion of rent expense of such Person or Personswith respect to such Measurement Periodunder capital or financial leases that is treated as interest inaccordance with Mexican GAAP, and (d) alldirect or indirect dividends or other distributions paid during such MeasurementPeriod on account of any shares of anypreferred stock of such Person, now or hereinafter outstanding.

 

“Interest Coverage Ratio” means, as of the last day of anyFiscal Quarter, the ratio of (a) Consolidated EBITDA to (b) Consolidated Interest Charges, in each case determined for the relevant Measurement Period; provided that for the purposes ofcalculating the Interest Coverage Ratio, Consolidated EBITDA shall not includeany payments received by the Company from Subsidiaries in the VenezuelanDivision in respect of the sale of shares of capital stock of Subsidiaries inthe Venezuelan Division, Dispositions of Property by Subsidiaries in theVenezuelan Division and other nonrecurring extraordinary payments bySubsidiaries in the Venezuelan Division.

 

“Interest Payment Date” means the last day of each InterestPeriod.

 

“Interest Period” means the period commencing on the last day ofthe preceding Interest Period (or in the case of the first Interest Period, thedate on which the Loan is made) and ending on the numerically correspondingdate one (1) month thereafter; provided, however, that:

 

(a)           the first (1st)Interest Period shall be the period commencing on the date the Loan is made andending on November 21, 2009.

 

(b)           if any Interest Period would otherwise endon a day that is not a Business Day, that Interest Period shall be extended tothe following Business Day unless the result of such extension would be tocarry such Interest Period into another calendar month, in which event suchInterest Period shall end on the next preceding Business Day;

 

(c)           any Interest Period that begins on thelast Business Day of a calendar month (or on a day for which there is nonumerically corresponding day in the calendar month in which 

 

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such Interest Period is to end) shall end on the lastBusiness Day of the calendar month in which such Interest Period is to end; and

 

(d)           no Interest Period shall extend beyondthe Maturity Date.

 

“Investment” means, as to any Person, any acquisition orinvestment (whether for cash Property,services, securities or otherwise) by such Person, whether by means of (a) thepurchase or other acquisition of capital stock, bonds, debentures or othersecurities of another Person, includingthe receipt of any of the foregoing as consideration for the Disposition of Propertyor rendering services,(b) the making of a deposit with, or any direct or indirect loan, advance, extension of credit or capital contribution to,guaranty of or other contingent obligation with respect to debt or any otherliability or obligations of, or purchase or other acquisition of any other debtor equity participation or ownership or other interest in, another Person,including any partnership or joint venture interest in such other Person, and the purchase of Property from anotherPerson subject to an understanding or agreement, contingent or otherwise, toresell such Property to such Person, (c) the purchase or otheracquisition (in one transaction or a series of transactions) of all or a substantial portion of the business or Property or other beneficial ownership of any other Person or (d) entering into aHedging Agreement.  For purposes ofcovenant compliance, the amount of any Investment shall be the amount actuallyinvested, without adjustment for subsequent increases or decreases in the valueof such Investment.

 

“IRS” meansthe United States Internal Revenue Service.

 

“IT Operating Lease” means an operating lease for informationtechnology equipment.

 

“Joint Venture Partner” means each of (i) Archer-Daniels-Midland, Inc.and its Affiliates,  (ii) RFBHoldings de México, S.A. de C.V. and its Affiliates and (iii) Rotch EnergyHoldings, N.V. and its Affiliates.

 

“Latin American Divisions” means each of the Molinera Division,the Gimsa Division and the Central America Division.  For the avoidance of doubt, the LatinAmerican Divisions shall not include any Venezuelan Subsidiary.

 

“Lender” has the meaning specified in the introductory clausehereto, and includes each Substitute Lender and each Assignee that becomes aLender pursuant to Section 9.08 (*Assignments,Participations, Etc*.).

 

“Lender’s Payment Office” means the address for payments setforth on the signature pages hereto, or such other address as the Lendermay from time to time specify to the other parties hereto.

 

“Lending Office” means, as to any Lender, the office or officesof such Lender specified as its “Lending Office” in the AdministrativeQuestionnaire, as from time to time amended, or such other office or offices assuch Lender may from time to time notify the Company.

 

“Leverage Ratio” means, on any date, the ratio of (a) TotalIndebtedness of the Company and its Consolidated Subsidiaries on such date to (b) ConsolidatedEBITDA of the Company and its Consolidated Subsidiaries determined for theMeasurement Period ended on such date (or, if

 

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such date is not the last day of a Fiscal Quarter, thelast day of the most recent Fiscal Quarter ended prior to such date); provided that for the purposes ofcalculating the Leverage Ratio, Consolidated EBITDA shall not include anypayments received by the Company from the Subsidiaries in the VenezuelanDivision in respect of the sale of shares of capital stock of the Subsidiariesin the Venezuelan Division, Dispositions of Property by Subsidiaries in theVenezuelan Division and other nonrecurring extraordinary payments bySubsidiaries in the Venezuelan Division.

 

“LIBOR” means for any Interest Period with respect to any LIBORLoan:

 

(a)                                  the rate per annum (rounded to thenearest 1/100th of1%) equal to the rate determined by the Lender as the London interbank offeredrate on any page or other service that displays an average British BankersAssociation bbalibor for deposits in US Dollars with a term of or comparable toone month, determined as of approximately 11:00 a.m., London time, two (2) BusinessDays prior to the first day of such Interest Period (with respect to anyInterest Period, the “Determination Date”); or

 

(b)                                 if the rate referenced in the precedingclause (a) is not available, the rate per annum (rounded to the nearest1/100th of1%) determined by the Lender as the rate per annum that deposits in US Dollarsfor delivery on the first day of such Interest Period quoted by the Lender toprime banks in the London interbank market for deposits in US Dollars atapproximately 11:00 a.m. (London time) on the relevant Determination Datein an amount approximately equal to the principal amount of the Loan to whichsuch Interest Period is to apply and for a term of or comparable to one month.

 

“Lien” means with respect to any Property, (a) any securityinterest, mortgage, deed of trust, *fideicomiso*,pledge, usufruct, fiduciary transfer, charge or deposit arrangement,encumbrance, lien (statutory or other) or preferential arrangement (including asecuritization) of any kind or nature whatsoever in respect of any Propertythat has the practical effect of creating a security interest, (b) theinterest of a vendor or a lessor under any conditional sale agreement, capitallease or title retention agreement (or any financing lease having substantiallythe same economic effect as any of the foregoing) relating to such Property and(c) in addition, in the case of securities, any purchase option, call orsimilar right of a third party with respect to such securities.

 

“Loan” has the meaning specified in Section 2.01(a) (*The Loan*).

 

“Loan Documents” means this Agreement, the Note, theIntercompany Trust Agreement, the Intercompany Subordination Agreement and allother related agreements and documents issued or delivered hereunder orthereunder or pursuant hereto or thereto or in connection herewith ortherewith, in each case as such Loan Document may be amended, supplemented orotherwise modified from time to time.

 

“Major Derivative Counterparties” means each of (i) CreditSuisse, Cayman Islands Branch, (ii) Deutsche Bank AG, London Branch, (iii) JPMorganChase Bank N.A. and any of their respective successors and assigns and includeseach “Substitute Lender” and each 

 

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“Assignee” that becomes a “Lender” (as such terms areused in the Major Derivative Counterparty Loan) pursuant to the MajorDerivative Counterparty Loan.

 

“Major Derivative Counterparty Loan” means the loan provided tothe Company pursuant to the US$668,282,700 Senior Secured Loan Agreement, datedon or about the date hereof, as amended from time to time, by and among theCompany, Deutsche Bank Trust Company Americas, as Administrative Agent, TheBank of New York Mellon, as Collateral Agent, and the lenders party theretofrom time to time.

 

“Mandatory Prepayment Indebtedness” means the Major DerivativeCounterparty Loan and the BBVA Loan.

 

“Material Adverse Effect” means any event, change, circumstance,condition, occurrence, effect, development or state of fact that, individuallyor together with any other event, change, circumstance, condition, occurrence,effect, development or state of fact, has had: (a) a material adversechange in, or a material adverse effect upon the operations, business, assets,liabilities (actual or contingent), obligations, rights, Property, condition(financial or otherwise) or operating results of the Company and itsSubsidiaries taken as a whole; (b) a material impairment of the ability ofthe Company to perform its obligations under any Loan Document to which it isor will be a party; (c) a material adverse effect upon the legality,validity, binding effect or enforceability against the Company of any LoanDocument to which it is or will be a party; or (d) a material impairmentof the rights and remedies of or benefits available to the Lender under anyLoan Document to which it is or will be a party.

 

“Material Operating Subsidiary” means each of Gimsa, Gruma Corp.and Molinera.

 

“Material Subsidiary” means:

 

(a)                                  the Material Operating Subsidiaries;

 

(b)                                 the Subsidiaries listed on Schedule 1.01(b) (*Existing Material Subsidiaries*);

 

(c)                                  at any time, any Subsidiary of theCompany that meets any of the following conditions:

 

(i)                                     the Company’s and its Subsidiaries’investments in or advances to such Subsidiary exceed 5% of the totalassets of the Company and its Consolidated Subsidiaries as of the end of theCompany’s most recently completed Fiscal Year;

 

(ii)                                  the Company’s and its Subsidiaries’proportionate share of the total assets (after intercompany eliminations) ofsuch Subsidiary exceeds 5% of the total assets of the Company and itsConsolidated Subsidiaries as of the end of the Company’s most recentlycompleted Fiscal Year; or

 

(iii)                               the Company’s and its Subsidiaries’proportionate share of the earnings before income tax and employee statutoryprofit sharing of such Subsidiary exceeds 5% of such earnings of theCompany and its Consolidated Subsidiaries as of the end of the Company’s mostrecently completed Fiscal Year;

 

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in each case as calculated by reference to the last audited orunaudited balance sheet or income statement prepared for such Subsidiary andthe then latest audited or unaudited consolidated balance sheet or incomestatement of the Company and its Subsidiaries;

 

(d)                                 any Subsidiary that the Company adds toSchedule 1.01(b) (*Existing MaterialSubsidiaries*) for purposes of compliance with Section 7.20 (*Material Subsidiaries*); and

 

(e)                                  in the case of clauses (a), (b) and (c) above,the direct and indirect Subsidiaries of such Subsidiaries.

 

“Maturity Date” means July 21, 2012, or if such day is nota Business Day, the next succeeding Business Day.

 

“Measurement Period” means any period of four (4) consecutiveFiscal Quarters of the Company, ending with the most recently completed FiscalQuarter, taken as one accounting period.

 

“Mexican GAAP” means, as applicable, (i) MexicanGenerally Accepted Accounting Principles (*Principios de ContabilidadGeneralmente Aceptados*) issued by the Mexican Accounting PrinciplesCommission of the Mexican Institute of Public Accountants effective until December 31,2005, (ii) the Mexican Financial Information Standards (*Normas de Información Financiera*) issued by the MexicanCouncil for the Research and Development of Financial Information Standards,effective from January 1, 2006, as amended from time to time, or (iii) IFRS as in effect as of January 1, 2012 or earlier should theCompany elect to apply them earlier than that date pursuant to Transitory Article Thirdof the January 27, 2009 amendments to the *Disposicionesde Carácter General Aplicables a las Emisoras de Valores y a OtrosParticipantes del Mercado de Valores* in effect from time to time inMexico.

 

“Mexican Pesos”, “Pesos” and “MXP$” means lawfulcurrency of Mexico.

 

“Mexico” means the United Mexican States.

 

“Ministry of Finance” means the Ministry of Finance and PublicCredit (*Secretaría de Hacienda y CréditoPúblico*) of Mexico.

 

“Minor Derivative Counterparties” means the Lender and the OtherMinor Derivative Counterparties, and includes each “Substitute Lender” and each“Assignee” that becomes a “Lender” pursuant to the Minor DerivativeCounterparty Loans.

 

“Minor Derivative Counterparty Loans” means the Loan and theOther Minor Derivative Counterparty Loans.

 

“Molinera” means Molinera de Mexico, S.A. de C.V., a *sociedad anónima de capital variable*organized under the laws of Mexico.

 

“Molinera Division” means Molinera together with its direct andindirect Subsidiaries.

 

“Moody’s” means Moody’s Investors Service, Inc. and itssuccessors.

 

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“Multiemployer Plan” means any employee benefit plan of the typedescribed in Section 4001(a)(3) of ERISA, to which the Company or anyERISA Affiliate makes or is obligated to make contributions, or during thepreceding three calendar years, has made or been obligated to makecontributions.

 

“Net Cash Proceeds” means, with respect to any event:

 

(a) the cash proceeds received in respect of such event, including(i) any cash and cash equivalents received by way of deferred paymentpursuant to, or by monetization of, a note receivable or otherwise, and (ii) inthe case of a Casualty Event, insurance awards;

 

*minus*

 

(b) the sum, as applicable and without duplication, of (i) allreasonable and customary fees, underwriting discounts, commissions, premiumsand out-of-pocket expenses paid by the Company and its Subsidiaries to thirdparties (other than Affiliates) in connection with such event, (ii) in thecase of a Disposition of Property, the amount of all payments required to bemade by the Company and its Subsidiaries as a result of such event to repayIndebtedness (other than the Loan) secured by such Property or otherwise thatis required by the terms of such Indebtedness to be repaid as a result of suchDisposition, (iii) in the case of a Casualty Event, the aggregate amountof proceeds of business interruption insurance, and (iv) the amount of alltaxes required to be paid and reasonably expected to be paid in accordance withpast practice by the Company and its Subsidiaries in connection with suchevent, including, for the avoidance of doubt, any taxes required to be paid andreasonably expected to be paid in accordance with past practice by the Companyand its Subsidiaries in connection with the distribution of such cash proceedsfrom the Subsidiary that received such cash proceeds to the Company.

 

“Note” means a promissory note (*pagaré*)of the Company payable to a Lender, substantially in the form of Exhibit A(as such promissory note may be replaced from time to time), evidencing theIndebtedness of the Company to such Lender resulting from such Lender’s Loan,and also means all other promissory notes accepted from time to time insubstitution therefor.

 

“Notice of Borrowing” means a notice containing the informationspecified in Section 2.03(a) (*Procedurefor Making of Loan*) substantially in the form of Exhibit G.

 

“Obligations” means all advances, debts, liabilities,obligations, covenants and duties arising under any Loan Document owing by theCompany to the Lenderor any indemnified person, whether director indirect (including those acquired by assignment), absolute or contingent,due or to become due, now existing or hereafter arising.

 

“OECD” means the Organization for Economic Cooperation andDevelopment.

 

“OFAC” has the meaning specified in Section 5.19(b)(v) (*Anti-Terrorism Laws*).

 

“Officer” means, with respect to the Company, a president,senior vice president, managing director, chief marketing officer, chiefadministrative officer, chief technology officer, chief corporate officer,director of corporate communications, chief procurement officer, 

 

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secretary of the board, treasurer or principalfinancial officer, comptroller or principal accounting officer of such Person,and any officer having substantially the same authority and responsibility asany of the foregoing.  For the avoidanceof doubt, the term “Officer” shall include all persons listed as officers ofthe Company in the Company’s most recent annual report filed on Form 20-Fwith the US Securities and Exchange Commission.

 

“Ordinary Course of Business” means, with respect to a Person,the ordinary course of business consistent with past practice of such Person.

 

“Organizational Documents” means, with respect to a Person, eachof the organizational and/or constituent documents of such Person, in each caseincluding all amendments thereto, including the articles or certificateof incorporation or *acta constitutiva*and the by-laws or *estatutos sociales*,or equivalent documents,of such Person.

 

“Other Currency” has the meaning specified in Section 9.17(b) (*Payment in US Dollars; Judgment Currency*).

 

“Other Indebtedness” means Indebtedness of the Company and itsSubsidiaries other than Working Capital Indebtedness and IntercompanyIndebtedness.

 

“Other Minor Derivative Counterparties” means each of ABN AMROBank N.V., Standard Chartered Bank and BNP Paribas.

 

“Other Minor Derivative Counterparty Loans” means the loansprovided to the Company by each of the Other Minor Derivative Counterpartiespursuant to the loan agreements, dated on or about the date hereof, as amended,modified or supplemented from time to time.

 

“Other Prepayment Indebtedness” means the Minor DerivativeCounterparty Loans, the Major Derivative Counterparty Loan and the BBVA Loan.

 

“Other Prepayment Pro Rata Amount” means, as of any date, withrespect to any Other Prepayment Indebtedness, a fraction (expressed as adecimal, rounded to the second decimal place), the numerator of which is theaggregate Dollar Amount of such Other Prepayment Indebtedness as of such date,and the denominator of which is the sum of the aggregate Dollar Amount of allOther Prepayment Indebtedness on such date.

 

“Other Restructured Indebtedness” means the Major DerivativeCounterparty Loan, the Other Minor Derivative Counterparty Loans, the BBVA Loanand the Bancomext Loan.

 

“Other Taxes” means, with respect to any Person, any present orfuture stamp, court or documentary taxes or any other excise or property taxes,or charges, imposts, duties, fees or similar levies which arise from anypayment made hereunder or any other Loan Document or from the execution,delivery or registration of, or otherwise with respect to, this Agreement or anyother Loan Document and which are actually imposed, levied, collected orwithheld by any Governmental Authority.

 

“Participation” has the meaning specified in Section 9.08(e) (*Assignments, Participations, Etc*.).

 

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“Participant” has the meaning specified in Section 9.08(e) (*Assignments, Participations, Etc*.).

 

“Patriot Act” has the meaning specified in Section 5.19(a) (*Anti-Terrorism Laws*).

 

“PBGC” means the Pension Benefit Guaranty Corporation referredto and defined in ERISA and any successor entity performing similar functions.

 

“Pension Plan” means any “employee pension benefit plan” (assuch term is defined in Section 3(2) of ERISA), other than aMultiemployer Plan, that is subject to Title IV of ERISA and is sponsored ormaintained by the Company or any ERISA Affiliate or to which the Company or anyERISA Affiliate contributes or has an obligation to contribute, or in the caseof a multiple employer plan (as described in Section 4064(a) ofERISA) has made contributions at any time during the immediately preceding fiveplan years.

 

“Permitted Acquisition” has themeaning specified in Section 7.12(b) (*Fundamental Changes, Limitations on Asset Sales, Asset Exchanges andAcquisitions*).

 

“Permitted Bancomext Guaranty” means theGuaranty Obligation of the Company in respect of the Bancomext-Gimsa Loan.

 

“Permitted Capital Expenditures Amount” meansan amount of Capital Expenditures on a consolidated basis that shall not exceedthe following amounts for each Fiscal Year specified:

 
| **Fiscal Year ending December 31,** | ** ** | **Permitted Capital Expenditures  Amount** |
|------------------------------------------|------------|--------------------------------------------|
| 2009                                     |       | US$                                        | 80,000,000 |
| 2010                                     |       | US$                                        | 80,000,000 |
| 2011                                     |       | US$                                        | 120,000,000 |
| 2012                                     |       | US$                                        | 140,000,000 |

 

“Permitted Company Equity Issuance” has the meaning specified inSection 7.22(b) (*Equity Issuances*).

 

“Permitted Lien” has the meaning specified in Section 7.01(*Negative Pledge*).

 

“Permitted New Capital Obligations” has the meaning specified inSection 7.16(g)(ii) (*Limitationson Incurrence of Additional Indebtedness*).

 

“Permitted New Indebtedness” has the meaning specified in Section 7.16(g) (*Limitations on Incurrence of Additional Indebtedness*).

 

“Permitted New Investment Amount” means, withrespect to any Fiscal Year following an Excess Cash Year, the lesser of (i) theAvailable Excess Cash Amount for such Excess Cash Year and (ii) US$50,000,000(or the US Dollar Equivalent thereof) in each of 2009, 2010 and 2011, andUS$100,000,000 (or the US Dollar Equivalent thereof) in 2012.

 

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“Permitted New Working Capital Indebtedness” has the meaningspecified in Section 7.16(g)(ii) (*Limitationson Incurrence of Additional Indebtedness*).

 

“Permitted Prepayment Asset Sale” means any Asset Sale otherthan (a) the Existing Venezuelan Sale, (b) Asset Sales by anySubsidiary that is part of the Venezuelan Division, to the extent suchSubsidiary is prohibited by Venezuelan laws or regulations from transferring orpaying such Net Cash Proceeds out of Venezuela, and (c) ProhibitedCollateral Sales.

 

“Permitted Refinancing Indebtedness” means Indebtedness incurredby the Company or its Subsidiaries to Refinance (i) the Other PrepaymentIndebtedness, (ii) the Bancomext Loan or (iii) Indebtedness ofSubsidiaries of the Company; provided that:

 

(a)                                  in the case of Company RefinancingIndebtedness:

 

(i)                                     the aggregate principal amountof such Company Refinancing Indebtednessas of the date that such Refinancing is consummated does not exceed theaggregate principal amount outstanding of the Indebtedness being Refinanced (plus the amountof any premium required to be paid under the terms of the instrument governingsuch Indebtedness being Refinanced);

 

(ii)                                  such Company Refinancing Indebtednesshas:

 

(A)                              a weighted average maturity that is equalto or greater than the weighted average maturity of (x) the Indebtednessbeing Refinanced and (y) the Loan, and

 

(B)                                a final maturity that is equal to orgreater than the final maturity of (x) the Indebtedness being Refinancedand (y) the Loan;

 

(iii)                               such Company Refinancing Indebtednessis Indebtedness of the Company;

 

(iv)                              if theIndebtedness being Refinanced is Subordinated Indebtedness, then such Company Refinancing Indebtednessshall be subordinate to the Loan and any other senior Indebtedness at least tothe same extent and in the same manner as the Indebtedness being Refinanced;

 

(v)                                 such Company Refinancing Indebtedness isincurred pursuant to (i) terms and pricing that reflect market terms andpricing for the Company and (ii) terms that are no less favorable to theCompany than the terms and conditions contained hereunder;

 

(vi)                              such Company Refinancing Indebtedness issecured, if at all, by the same collateral as, and to an extent no greaterthan, the Indebtedness being Refinanced, and if such Company RefinancingIndebtedness is incurred to Refinance the Mandatory Prepayment Indebtedness,such Company Refinancing Indebtedness is secured, if at all, on a *pari passu* basis with such RefinancedMandatory 

 

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PrepaymentIndebtedness, and pursuant to an amendment to the Collateral Agency andIntercreditor Agreement;

 

(vii)                           such Company Refinancing Indebtedness is not guaranteed by any of the Company’sSubsidiaries;

 

(viii)                        all of the Net Cash Proceeds of suchCompany Refinancing Indebtedness are used to prepay the Indebtedness beingRefinanced (plus the amount of any premium required to be paidunder the terms of the instrument governing such Indebtedness being Refinanced) and any other Indebtedness that isrequired to be prepaid pursuant to Section 2.05(d) (*Mandatory Prepayments*) (and any breakagecosts in connection therewith) within five (5) Business Days of theincurrence of such Company Refinancing Indebtedness;

 

(ix) in thecase of Company Refinancing Indebtedness incurred to Refinance the MinorDerivative Counterparty Loans, such Company Refinancing Indebtedness consistsonly of unsecured Indebtedness raised in the debt capital markets;

 

(x)                                   in the case of Company RefinancingIndebtedness incurred to Refinance the Bancomext Loan:

 

(A)                              the aggregate amount of scheduledamortizations under such Company Refinancing Indebtedness on any date cannotexceed the aggregate amount of scheduled amortizations under the Bancomext Loanon such date;

 

(B)                                the interest rate for such CompanyRefinancing Indebtedness cannot be more than a rate equal to the sum of (i) the*Tasa de Interés Interbancaria de Equilibrioa 28 días* as published in the Diario Oficial de la Federación by theBanco de México, plus (ii) 5.00% per annum; and

 

(C)                                the tenor of such Company RefinancingIndebtedness cannot be less than the tenor of the Bancomext Loan; and

 

(b)                                 in the case of Indebtedness incurred toRefinance Indebtedness of a Subsidiary:

 

(i)                                     the aggregate principal amount (or initialaccreted value, if applicable) of such new Indebtedness as of the date that suchRefinancing is consummated does not exceed the aggregate principal amountoutstanding (or initial accreted value, if applicable) of the Indebtedness being Refinanced (plus the amountof any premium required to be paid under the terms of the instrument governingsuch Indebtedness being Refinanced);

 

(ii)                                  such new Indebtedness has:

 

(A)                              a weighted average maturity that is equalto or greater than the weighted average maturity of the Indebtedness beingRefinanced, and

 

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(B)                                a final maturity that is equal to orgreater than the final maturity of the Indebtedness being Refinanced;

 

(iii)                               such newIndebtedness is Indebtedness of such Subsidiary;

 

(iv)                              if theIndebtedness being Refinanced is Subordinated Indebtedness, then such newIndebtedness shall be subordinate to any senior Indebtedness at least to thesame extent and in the same manner as the Indebtedness being Refinanced;

 

(v)                                 such new Indebtedness is incurredpursuant to (i) terms and pricing that reflect market terms and pricingfor such Subsidiary and (ii) terms that are no less favorable to theSubsidiary than the terms and conditions hereunder;

 

(vi)                              such new Indebtedness is secured usingthe same collateral as, and to an extent no greater than, the Indebtednessbeing Refinanced;

 

(vii)                           such new Indebtedness, if guaranteed bythe Company or any Subsidiary, is guaranteed by the same Persons as, and to anextent no greater than, the Indebtedness being Refinanced; provided thatthe Permitted Bancomext Guaranty may not be extended or renewed; and

 

(viii)                        all of the Net Cash Proceeds of such newIndebtedness are used to prepay the Indebtedness being Refinanced (plus the amountof any premium required to be paid under the terms of the instrument governingsuch Indebtedness being Refinanced) within five (5) Business Days of the incurrenceof such new Indebtedness.

 

“Permitted Venezuelan Recourse Indebtedness” has the meaningspecified in Section 7.16(e) (*Limitationson Incurrence of Additional Indebtedness*).

 

“Perpetual Bonds” means the 7.75% Perpetual Bonds issued by theCompany.

 

“Person” means any natural person, partnership, limitedliability company, corporation, business trust, joint stock company, trust,unincorporated association, joint venture or Governmental Authority or otherentity.

 

“Plan” means any “employee benefit plan” (as such term isdefined in Section 3(3) of ERISA) established by the Company or anyERISA Affiliate.

 

“Pledged Entity Asset Sale” means any Asset Sale by anySubsidiary in the Gimsa Division, the Gruma Corp. Division or the MolineraDivision.

 

“Pledged Entity Casualty Event” meansany Casualty Event affecting any Subsidiary in the Gimsa Division, the GrumaCorp. Division or the Molinera Division.

 

“Post-Default Rate” means a rate perannum equal to (x) the Alternate Base Rate plus the Applicable Margin or (y) LIBORplus the Applicable Margin, as notified to the Company by the Lender, in eachcase plus two percent (2%).  Unless and until the Lendernotifies the Company 

 

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otherwise, the Post-Default Rate applicable to theLoan shall be LIBOR plus the Applicable Margin plus two percent (2%)

 

“Probable Bond” means a bond for or inconnection with a Proceeding for which the Company’s or its Subsidiaries’accountants have required reserves to be provided in accordance with applicableGAAP.

 

“Proceeding”means a litigation,claim, action or other proceeding before any Governmental Authority.

 

“Process Agent” has the meaning specified in Section 9.15(d) (*Consent to Jurisdiction; Waiver of Jury Trial*).

 

“Prohibited Collateral Sale” means any Disposition of the “Collateral”,as such term is used in the Major Derivative Counterparty Loan.

 

“Property” means any asset, revenue or any other property,whether tangible or intangible, including any right to receive income.

 

“Pro Rata Share” means, as of any date, with respect to eachMinor Derivative Counterparty, a fraction (expressed as a decimal, rounded tothe second decimal place) the numerator of which is the outstanding principalamount of the Loan of such Minor Derivative Counterparty and the denominator ofwhich is the aggregate principal amount of all Minor Derivative CounterpartyLoans.

 

“Qualified Accountant” means any of PriceWaterhouseCoopers,KPMG, Deloitte Touche Tohmatsu or Ernst and Young; provided that, at anytime, the auditor of the Company or any of its Subsidiaries shall not be aQualified Accountant.

 

“Qualified Counterparty” means afinancial institution (a) based in a country that is a member of the OECDand (b) that has a creditrating of A- or higher from S&P or A3 or higher from Moody’s, or, if suchfinancial institution is rated by both S&P and Moody’s, a credit rating ofA- or higher from S&P and A3 or higher from Moody’s.

 

“Quarterly Compliance Certificate”means a certificate substantially in the form of Exhibit B-1.

 

“Refinance” means, in respect of anyIndebtedness, to issue any Indebtedness in exchange for or to refinance,replace, defease or refund such Indebtedness in whole or in part.  “Refinanced” and “Refinancing”have the meanings correlative thereto.

 

“Register” has the meaning specified in Section 9.08(c) (*Assignments, Participations, Etc.*).

 

“Reinvestment Certificate” means, with respect to an Asset Sale,a certificate signed by a Senior Officer of the Company stating that within therelevant Reinvestment Period, up to 50% of the Net Cash Proceeds of such AssetSale shall be used to make Restricted Investments.

 

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“Reinvestment Period” means

 

(a)                                  with respect to any Casualty Event, theperiod of one hundred eighty (180) days following the date on which the NetCash Proceeds of such Casualty Event are received by the Company; and

 

(b)                                 with respect to any Asset Sale, theperiod of two hundred and seventy (270) days following the date on which suchAsset Sale was consummated.

 

“Reportable Event” means any of the events set forth in Section 4043(c) ofERISA, other than events for which the thirty (30)-day notice period has beenwaived.

 

“Reporting Entity” has meaning specified in Section 6.01(a)(i) (*Financial Statements and Other Information*).

 

“Reporting Indebtedness” means each of (a) the SecuredIndebtedness, (b) the Bancomext Loan, (c) the Minor DerivativeCounterparty Loans, and (d) any Indebtedness the proceeds of which areapplied to the Refinancing of the foregoing.

 

“Reporting Indebtedness Documentation” has the meaning specifiedin Section 4.01(m) (*Delivery ofReporting Indebtedness Documents*).

 

“Reporto Contract” means any Contractual Obligation providingfor (a) the sale to a third party counterparty by the Company or itsSubsidiaries of a negotiable warehouse receipt (*certificado de depósito*) or any similar instrumentrepresenting corn or wheat stored in a warehouse and (b) the subsequentrepurchase of such negotiable warehouse receipt (*certificado de depósito*) or similar instrument by theCompany or such Subsidiary from such third party counterparty for the sameprice plus a premium previously agreed to by the parties.

 

“Required Payment Period” means, with respect to an Asset Saleor a Casualty Event, the period of (i) five (5) Business Daysfollowing the receipt of the Net Cash Proceeds thereof (or, if applicable,following the last day of the relevant Reinvestment Period) if such Net CashProceeds are received by the Company, or (ii) ten (10) Business Daysfollowing the receipt of the Net Cash Proceeds thereof (or, if applicable,following the last day of the relevant Reinvestment Period) if such Net CashProceeds are received by a Subsidiary of the Company.

 

“Required Repayment Date” means, with respect to an Asset Saleor Casualty Event, the last day of the relevant Required Payment Period.

 

“Requirement of Law” means, as to any Person, any law (statutoryor common), treaty, rule or regulation or order, injunction, writ, decreeor other determination of an arbitrator or a court or other GovernmentalAuthority, including any Environmental Law, in each case applicable to orbinding upon such Person or any of its property or to which the Person or anyof its property is subject.

 

“Restore” means, with respect to any Property affected by aCasualty Event, to rebuild, repair, restore or replace such affected Property.

 

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“Restricted Investments” means:

 

(a)                                  Investments consisting of the purchase ofthe capital stock of Gimsa;

 

(b)                                 subject to andin accordance with Section 7.12(b) (*FundamentalChanges, Limitations on Asset Sales, Asset Exchanges and Acquisitions*),Investments relatingto the Company’s Core Business (other than Investments in the VenezuelanDivision);

 

(c)                                  Investments by the Company in anyMaterial Subsidiary (other than any Subsidiary that is part of the VenezuelanDivision) or by any Material Subsidiary in the Company or in any MaterialSubsidiary (other than any Subsidiary that is part of the Venezuelan Division);and

 

(d)                                 Investments consisting of CapitalExpenditures in excess of the Capital Expenditures permitted by Sections 7.14(a) and7.14(b) (*Limitations on CapitalExpenditures*) for such Fiscal Year; provided that the Companycomplies with Section 7.14(c) (*Limitationson Capital Expenditures*) with respect to such Capital Expenditures;

 

provided, however,that notwithstanding any of the foregoing, the Company and its Subsidiaries(other than any Subsidiary that is part of the Venezuelan Division) shall notmake any Investments in the Venezuelan Division.

 

“Restricted Payment” means, with respect to any Person:

 

(a)                                  any direct orindirect dividend or other distribution (whether in cash, securities or otherProperty) on account of any shares of any class of capital stock of,partnership interest of or other ownership interest of, such Person, now orhereinafter outstanding;

 

(b)                                 any payment,sinking fund or similar deposit, purchase, redemption, retirement, acquisition,cancellation or termination of any such shares of capital stock, partnershipinterest or other ownership interest in, or of any option, warrant or otherright to acquire any such shares of capital stock, partnership interest orother interest in, of such Person; and

 

(c)                                  any payment orprepayment of principal of, premium, if any, or fees or other charges on orwith respect to, and any redemption, purchase, retirement, defeasance, sinkingfund or similar payment and any claim for rescission with respect to, anyIndebtedness which is subordinated to the Obligations (other than IntercompanyIndebtedness), including Subordinated Indebtedness.

 

“S&P” means Standard & Poor’sRatings Service, presently a division of The McGraw-Hill Companies, Inc.and its successors.

 

“Sale Lease-Back Transaction” means any arrangement pursuant towhich a Person sells or transfers, directly or indirectly, any Property used oruseful in its business, and thereafter such Person or an Affiliate of suchPerson rents or leases such Property or other Property from the purchaser ortransferee (or their Affiliate) for the same or similar use in its business, orany similar transaction or arrangement.

 

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“SAR” means the *Sistema deAhorro para el Retiro*of Mexico.

 

“Secured Indebtedness” means the Major Derivative CounterpartyLoan, the BBVA Loan and the Perpetual Bonds.

 

“Senior Officer” means, with respect to any Person, the chiefexecutive officer, the president, the general manager or the chief financialofficer of such Person, or, in each case, any other officer of such Personhaving substantially the same authority and responsibility.

 

“Shared Casualty Events Proceeds” means Net Cash Proceeds ofCasualty Events (other than Net Cash Proceeds from a Casualty Event received byany Subsidiary that is part of the Venezuelan Division, to the extent suchSubsidiary is prohibited by Venezuelan laws or regulations from transferring orpaying such Net Cash Proceeds out of Venezuela).

 

“Shared Permitted Prepayment Asset Sale Proceeds” means the NetCash Proceeds of any Permitted Prepayment Asset Sale.

 

“Shared Proceeds” means the (a) the Shared PermittedPrepayment Asset Sale Proceeds and (b) Shared Casualty Events Proceeds.

 

“Shared Proceeds Trigger” has the meaning specified in Section 2.05(a)(ii) (*Mandatory Prepayments*).

 

“Solvent” means, with respect to any Person on a particulardate, that on such date, (a) the present fair value of the property ofsuch Person is greater than the total amount of debts and liabilities,subordinated, contingent or otherwise, of such Person, (b) such Personwill be able to pay its debts and liabilities, subordinated, contingent orotherwise, as such debts and liabilities become absolute and matured, (c) suchPerson will not have unreasonably small capital with which to conduct thebusiness in which it is engaged as such business is now conducted and proposedto be conducted after such date, (d) such Person is notin a generalized default of its payment obligations *(**incumplimiento generalizado en elpago de sus obligaciones**)* within the meaning of Section Ior II of Article 10 of the Mexican *Leyde Concursos Mercantiles*, and (e) none of the events enumeratedin Sections I through VII of Article 11 of the Mexican *Ley de Concursos Mercantiles*shall be in effect with respect to suchPerson.  The amount of contingent liabilities at anytime shall be computed as the amount that, in the light of all the facts andcircumstances existing at such time, represents the amount that couldreasonably be expected to become an actual or matured liability.

 

“Specified Court” has the meaning specified in Section 9.15(a) (*Consent to Jurisdiction; Waiver of Jury Tria*l).

 

“Subordinated Indebtedness” means,with respect to the Company or any of its Subsidiaries, any Indebtedness of theCompany or such Subsidiary, as the case may be, which is pursuant to its termsexpressly subordinated in right of payment to any senior Indebtedness.

 

“Subsidiary” of a Person means any corporation, partnership,joint venture, limited liability company, trust, estate or other entity (a) of which more than 50% of the voting stock or otherequity interests (in the case of Persons other than corporations), is owned orControlled 

 

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directly or indirectly by such Person, or one or moreof the Subsidiaries of such Person, or a combination thereof, or (b) that is, at the time anydetermination is made, otherwise Controlled, by such Person or one or more Subsidiariesof such Person.  Unless the context otherwise clearlyrequires, references herein to a “Subsidiary” refer to a direct or indirectSubsidiary of the Company.

 

“Substitute Lender” means (a) a Foreign FinancialInstitution (including a bank that is already a Lender hereunder) or (b) amultiple banking institution (*institución debanca múltiple*) that is organized as a *sociedad anónima*under Mexican law and is authorized toengage in the business of banking by the Ministry of Finance, in each case thatis acceptable to the Lender, whose consent will not be unreasonably withheld.

 

“Target” has the meaning specified in Section 7.12(b) (*Fundamental Changes, Limitations on Asset Sales,Asset Exchanges and Acquisitions*).

 

“Taxes” means any and all present or future taxes, duties,levies, assessments, imposts, deductions, withholdings or similar charges, andall liabilities with respect thereto, including any related interest orpenalties, imposed by Mexico or any political subdivision or taxing authoritythereof or therein or by any jurisdiction from which the Company shall make anypayment (or from which any payment shall be made) hereunder or under any LoanDocument.

 

“Temporary Accounts” means the Temporary Loan Account and eachaccount established for similar purpose by the Other Minor DerivativeCounterparties and the Major Derivative Counterparties in the name of theCompany pursuant to the Other Minor Derivative Counterparty Loans and the MajorDerivative Counterparty Loan.

 

“Temporary Loan Account” has the meaning specified in Section 2.03(b) (*Procedure for Making of Loan*).

 

“Terminated Derivative Obligation” means the $21,500,000obligation (other than in respect of interest) of the Company to the InitialLender arising out of the Confirmation.

 

“Total Indebtedness” means, on any date, the outstandingprincipal balance of all Indebtedness of the Company and its ConsolidatedSubsidiaries (excluding Venezuelan Non-Recourse Indebtedness).

 

“Trustee”means Banco Nacional de México S.A., Integrante del Grupo Financiero Banamex,División Fiduciaria as the trustee (*fiduciario*)pursuant to the Intercompany Trust Agreement.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’sbenefit liabilities under Section 4001(a)(16) of ERISA, over the currentvalue of that Pension Plan’s assets, determined in accordance with theassumptions used for funding the Pension Plan pursuant to Section 412 ofthe Code for the applicable plan year.

 

“United States” and “US” each means the United States ofAmerica.

 

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“Unused CapEx” means, in respect of any Fiscal Year, thePermitted Capital Expenditures Amount (without giving effect to any carry-overfrom any prior year) for such Fiscal Year less all Capital Expenditures madeduring such Fiscal Year.

 

“US Dollars”, “Dollars” and “US$” each meanslawful currency of the United States.

 

“US Dollar Equivalent” means, with respect to any non-USDollar-denominated amount on any date, the amount of US Dollars obtained byconverting such non-US Dollar-denominated amount into US Dollars using theConversion Rate on such date.

 

“US GAAP” means (i) generally accepted accountingprinciples in the United States or (ii) theinternational financial reporting standards set by the International AccountingStandards Board or any successor thereto, to the extent that a Person organized under the lawsof a jurisdiction of the United States would be permitted under the applicableRequirements of Law to use such standards in financial statements filed inreports with the Securities and Exchange Commission.

 

“Venezuelan Division” means each of theVenezuelan Subsidiaries together with their respective direct and indirectSubsidiaries.

 

“Venezuelan EBITDA” means, with respect to theVenezuelan Division, for any period (a) the sum of (i) consolidatedoperating income (determined in accordance with Mexican GAAP) for such period, (ii) theamount of depreciation and amortization expense deducted during such period indetermining such consolidated operating income for such period and (iii) anyother non-cash expenses deducted during such period in determining suchconsolidated operating income of the Venezuelan Division for such period *minus* (b) any other non-cash incomeincluded in the calculation of consolidated operating income of theSubsidiaries that are part of the Venezuelan Division for such period.

 

“Venezuelan Non-Recourse Indebtedness” meansany Indebtedness incurred by any Subsidiary that is part of the VenezuelanDivision that is not directly or indirectly guaranteed or otherwise withrecourse to the Company or any Subsidiary of the Company other than anySubsidiary that is part of the Venezuelan Division.

 

“Venezuelan Recourse Indebtedness” means anyIndebtedness incurred by any Subsidiary that is part of the Venezuelan Divisionthat is not Venezuelan Non-Recourse Indebtedness.

 

“Venezuelan Subsidiaries” means (i) eachof Derivados de Maíz Seleccionado, S.A. and Molinos Nacionales, C.A. and (ii) anySubsidiary of the Company that is organized under the laws of Venezuela afterthe date of this Agreement, provided that (x) such new Subsidiaryis duly organized under the laws of Venezuela and (y) the OrganizationalDocuments of such new Subsidiary do not violate the terms of this Agreement.

 

“Withdrawal Liability” has the meaning given such term under Part Iof Subtitle E of Title IV of ERISA.

 

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“Working Capital Indebtedness” means (i) Indebtedness(other than Venezuelan Non-Recourse Indebtedness) incurred or held by theCompany or any of its Subsidiaries, that matures no later than three hundredsixty-five (365) days after the date of its incurrence and (ii) the Bankof America Facility.

 

1.02.                        Other Interpretive Provisions.

 

(a)                                  The meanings of defined terms are equallyapplicable to the singular and plural forms of the defined terms.

 

(b)                                 The words “hereof”, “herein”, “hereunder”and similar words refer to this Agreement as a whole and not to any particularprovision of this Agreement; and Section, clause, Schedule and Exhibit referencesare to this Agreement unless otherwise specified.

 

(c)                                  The terms “including” and “include” arenot limiting and mean “including without limitation” and “include withoutlimitation”.

 

(d)                                 In the computation of periods of timefrom a specified date to a later specified date, the word “from” means “fromand including”; the words “to” and “until” each means “to but excluding”, andthe word “through” means “to and including”.

 

(e)                                  Any definition of or reference to anyagreement, instrument or other document herein shall be construed as referringto such agreement, instrument or other document as from time to time amended,supplemented or otherwise modified (subject to any restrictions on suchamendments, supplements or modifications set forth herein).

 

(f)                                    Any reference herein to any Person shallbe construed to include such Person’s successors and assigns.

 

(g)                                 Any reference herein to “year”, “month”or “day” shall mean a calendar year, month, or day unless otherwise specified.

 

(h)                                 The captions and headings of thisAgreement are for convenience of reference only and shall not affect theinterpretation of this Agreement.

 

(i)                                     The amounts of Consolidated EBITDA,Consolidated Interest Charges and Total Indebtedness shall be expressed inMexican Pesos in accordance with Mexican GAAP, consistently applied.

 

(j)                                     The calculation of the US DollarEquivalent of any amount shall be the US Dollar Equivalent thereof:

 

(i)                                                             if such amount is being created, incurredor assumed by the Company, as of the date of such creation, incurrence orassumption; and

 

(ii)                                                          if such amount is being paid (includingany mandatory prepayment required by Section 2.05 (*Mandatory Prepayments*) or Disposed of bythe Company, as of the date of such payment or Disposition.

 

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1.03.                        Accounting Principles.

 

(a)                                  Unless the context otherwise clearlyrequires, all accounting terms not expressly defined herein shall be construed,and all financial computations required under this Agreement shall be made, inaccordance with Mexican GAAP, consistently applied.

 

(b)                                 References herein to “Fiscal Year” and “FiscalQuarter” refer to such fiscal periods of the Company.

 

ARTICLEII

THELOAN

 

2.01.                        The Loan.

 

(a)                                  The Initial Lender agrees, on the termsand subject to the conditions set forth herein, and relying on the representations and warranties set forth herein, to make a single term loan in US Dollarsin a single disbursement to the Company on the Closing Date in a principalamount equal to the Initial Lender’s TerminatedDerivative Obligation (the “Loan”).

 

(b)                                 No amounts prepaid or repaid with respectto the Loan may be reborrowed.

 

(c)                                  In the event that each of (x) theClosing Date and (y) the disbursement of the Loan in accordance withclause (a) above do not occur on or before the date that is ten (10) calendardays following the date of this Agreement, then this Agreement and thecommitments hereunder shall automatically terminate, and the TerminatedDerivative Obligation shall continue to be governed by the Confirmation;provided that notwithstanding the foregoing, the agreements contained inSections 3.01 (*Taxes*), 3.05 (*Funding Losses*), 9.04 (*Costs and Expenses*), 9.05 (*Indemnification by the Company*), 9.13 (*Severability*), 9.14 (*Governing Law*), 9.15 (*Consent to Jurisdiction, Waiver of Jury Trial*),9.16 (*Waiver of Immunity*) and9.17 (*Payment in US Dollars; JudgmentCurrency*) shall survive any termination pursuant to this Section 2.01(c).

 

2.02.                        Evidence of Indebtedness.

 

(a)                                  The Lender’s Loan shall be evidenced by aNote payable to the order of the Lender in a principal amount equal to theLender’s Loan, maturing on the Maturity Date.

 

(b)                                 It is the intent of the Company and theLender that the Note qualifies as a *pagaré*underMexican law.

 

(c)                                  In the eventthat any conflict arises between the provisions of this Agreement and the termsof any Note, the provisions of this Agreement shall prevail.  In addition, the Company hereby agrees andcovenants that it will execute and deliver any and all endorsements to theNote, or replace (in exchange for) the Note, and take all further action thatthe Lender may reasonably request from time to time in order to ensure that theNote duly reflects the terms of this Agreement.

 

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2.03.                        Procedure for Making of Loan.

 

(a)                                  Disbursement of the Loan shall be madeupon the Company’s irrevocable written notice delivered to the Initial Lenderin the form of a Notice of Borrowing (which notice must be received by theInitial Lender prior to 11:00 a.m. (New York City time) two (2) BusinessDays prior to the Closing Date) (i) specifying the proposed Closing Date,which shall be a Business Day, and (ii) instructing the Initial Lender toapply the proceeds of the Initial Lender’s Loan to repay the TerminatedDerivative Obligation of the Initial Lender.

 

(b)                                 The Initial Lender shall disburse the full amountof its Loan not later than 11:00 a.m. (New York City time) on the Closing Date by wiretransfer of immediately available funds to an account established in the nameof the Company at the Initial Lender or the Initial Lender’s nominee (the “TemporaryLoan Account”), which account shall be governed by the Control Agreementwith such Initial Lender.

 

(c)                                  Upon receipt of the proceeds of theInitial Lender’s Loan in the Temporary Loan Account established in the name ofthe Company at the Initial Lender, the Initial Lender shall, pursuant to theinstructions contained in the Notice of Borrowing delivered by the Company tothe Initial Lender, apply such proceeds to repay the Terminated DerivativeObligation of the Initial Lender.  TheCompany hereby irrevocably instructs the Initial Lender (or the Initial Lender’snominee) to apply the proceeds of the Loan to the Terminated DerivativeObligation as specified above.

 

2.04.                        Voluntary Prepayments.

 

(a)                                  Subject to Section 3.05 (*Funding Losses*) and Section 2.09 (*Payments by the Company*), the Company may,at any time or from time to time, upon not less than three (3) BusinessDays’ irrevocable written notice to the Lender, voluntarily prepay the MinorDerivative Counterparty Loans on a prorata basis in accordancewith clause (c) below, in whole or in part, in minimum amounts ofUS$3,000,000 or any multiple of US$1,000,000 in excess thereof.  The notice of prepayment shall specify thedate and amount of such prepayment (and, upon the date specified in any suchnotice, the amount to be prepaid shall become due and payable hereunder).

 

(b)                                 Any optionalprepayment of the Loan under this Section 2.04 shall (i) beaccompanied by any accrued and unpaid interest with respect to the principalamount of the Loan being repaid through the date of repayment together withadditional amounts due, if any, and (ii) if such prepayment shall be madeon a day other than the last day of the Interest Period, be accompanied by anyand all amounts payable in connection therewith pursuant to Section 3.05 (*Funding Losses*).

 

(c)                                  The aggregate amount of any such prepayment of the Loan by the Companyshall be (i) paid in US Dollars and (ii) applied to (x) allMinor Derivative Counterparty Loans on a prorata basis accordingto each Minor Derivative Counterparty’s Pro Rata Share and (y) reduce prorata the amountof each of the last six (6) (or, if at the time of such repayment six (6) orless are remaining, all remaining) installments of principal, and thereafter to theremaining installments of principal in the inverse order of maturity set forth in Section 2.06 (*Repayment of the Loan*).

 

2.05.                        Mandatory Prepayments.

 

(a)                                  In each Fiscal Year:

 

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(i)                                                             the Company shall, and shall cause eachof its Subsidiaries to, prepay 100% of Shared Permitted Prepayment Asset SaleProceeds to the Mandatory Prepayment Indebtedness within the applicableRequired Payment Period until such time that the amount of Shared Proceeds paidto the Mandatory Prepayment Indebtedness pursuant to this Section 2.05exceeds US$50,000,000 (or the US Dollar equivalent thereof) in such FiscalYear; and

 

(ii)                                                          if, at any time during such Fiscal Year,the amount of Shared Proceeds received in such Fiscal Year by the Company andits Subsidaries and paid to theMandatory Prepayment Indebtedness pursuant to this Section 2.05 exceedsUS$50,000,000 (or the US Dollar equivalent thereof) (the “Shared ProceedsTrigger” for such Fiscal Year), then after the Shared Proceeds Trigger anduntil the last day of such Fiscal Year, the Company shall, and shall cause eachof its Subsidiaries to, prepay 100% of Shared Permitted Prepayment Asset SaleProceeds of any Permitted Prepayment Asset Sales received by the Company aftersuch Shared Proceeds Trigger to the Other Prepayment Indebtedness within theapplicable Required Payment Period; provided that, notwithstanding theforegoing, if and for so long as any “Default” or “Event of Default” iscontinuing under, and as defined in, the Major Derivative Counterparty Loan orthe BBVA Loan, the Company shall and shall cause each of its Subsidiaries toprepay 100% of the Net Cash Proceeds of any Pledged Entity Asset Sales to theMandatory Prepayment Indebtedness within the applicable Required PaymentPeriod;

 

provided that, in the case of clauses (i) and (ii) above,if and for so long as no Default or Event of Default is continuing hereunderand the Company has delivered a Reinvestment Certificate within the applicableRequired Payment Period for such Permitted Prepayment Asset Sale, up to 50% ofthe Shared Permitted Prepayment Asset Sale Proceeds (other than the Dispositionof any of the Banorte Shares) may be used for Investments in long-termproductive assets used in the Company’s Core Business during the ReinvestmentPeriod for such Permitted Prepayment Asset Sale; provided, further,that any such amount of Shared Permitted Prepayment Asset Sale Proceeds usedfor Investments in long-term productive assets used in the Company’s CoreBusiness shall not be counted against the thresholds in clauses (i) and (ii) above;provided, further, that if all or any portion of such SharedPermitted Prepayment Asset Sale Proceeds is not ultimately applied to suchInvestments within the Reinvestment Period pursuant to the preceding proviso,any remaining portion of such Shared Permitted Prepayment Asset Sale Proceedsshall be applied to prepay the Mandatory Prepayment Indebtedness or the OtherPrepayment Indebtedness, as applicable pursuant to the thresholds in clauses (i) and(ii) above, on the Required Repayment Date.  Notwithstanding anything herein to thecontrary, 100% of the Net Cash Proceeds of any Disposition of any of theBanorte Shares shall be applied to the prepayment of the Mandatory PrepaymentIndebtedness or the Other Prepayment Indebtedness, as applicable pursuant tothe thresholds in clauses (i) and (ii) above, within the applicableRequired Payment Period, and none of the Net Cash Proceeds thereof may be usedfor Investments in long-term productive assets in the Company’s Core Businessor any purpose other than prepayment of the Mandatory Prepayment Indebtednessor Other Prepayment Indebtedness, as applicable.

 

(b)                                 In each Fiscal Year:

 

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(i)                                                             the Company shall, and shall cause eachof its Subsidiaries to, prepay 100% of Shared Casualty Event Proceeds to theMandatory Prepayment Indebtedness within the applicable Required Payment Perioduntil such time that the amount of Shared Proceeds received by the Company andits Subsidiaries exceeds US$50,000,000 (or the US Dollar equivalent thereof) insuch Fiscal Year; and

 

(ii)                                                          if, at any time during such Fiscal Year,a Shared Proceeds Trigger occurs, then after such Shared Proceeds Trigger anduntil the last day of such Fiscal Year, the Company shall, and shall cause eachof its Subsidiaries to, prepay 100% of such Shared Casualty Event Proceedsreceived by the Company after such Shared Proceeds Trigger to the OtherPrepayment Indebtedness within the applicable Required Payment Period;  provided that, notwithstanding theforegoing, if and for so long as any “Default” or “Event of Default” iscontinuing under, and as defined in, the Major Derivative Counterparty Loan orthe BBVA Loan, the Company shall and shall cause each of its Subsidiaries toprepay 100% of the Net Cash Proceeds of any Pledged Entity Casualty Event tothe Mandatory Prepayment Indebtedness within the applicable Required PaymentPeriod;

 

provided that, if and for so long as no Default or Event ofDefault is continuing hereunder, and (i) the Shared Casualty EventsProceeds of any Casualty Event do not exceed (A) US$10,000,000 (or the USDollar Equivalent thereof) without the written consent of the holders of morethan 50% of the then aggregate outstanding principal amount of the MajorDerivative Counterparty Loan (such consent not to be subject to a fee or to beunreasonably withheld) or (B) US$55,000,000 (or the US Dollar Equivalentthereof) in any event and (ii) the Company has (A) filed a claim inrespect of such Casualty Event within five (5) Business Days thereof and (B) delivereda Casualty Certificate within ten (10) Business Days following the filingof such claim, all (but no more than US$10,000,000 (or the US Dollar Equivalentthereof) without the written consent of the holders of more than 50% of thethen aggregate outstanding principal amount of the Major DerivativeCounteryparty Loan or US$55,000,000 (or the US Dollar Equivalent thereof) inany event) of such Shared Casualty Events Proceeds from such Casualty Event maybe used to Restore any such affected Properties during the Reinvestment Period;provided, further, that any such amount of Shared Casualty Events Proceeds fromsuch Casualty Event used to Restore any such affected Properties shall not becounted against the thresholds in clauses (i) and (ii) above; provided,further, that if all or any portion of such Shared Casualty Events Proceedsfrom such Casualty Event is not ultimately applied to Restore any affectedProperties within the Reinvestment Period pursuant to the preceding proviso,any remaining portion of such Shared Casualty Events Proceeds from suchCasualty Event shall be applied to prepay the Mandatory Prepayment Indebtednessor the Other Prepayment Indebtedness, as applicable pursuant to the thresholdsin clauses (i) and (ii) above, on the Required Repayment Date.

 

(c)                                  The Company shall, and shall cause eachof its Subsidiaries to, apply 100% of the Net Cash Proceeds of the issuance ofany Indebtedness of the Company or any of its Subsidiaries (other than theissuance of Indebtedness permitted by Section 7.16 *(Limitations on Incurrence of Additional Indebtedness*))to prepayment of the Other Prepayment Indebtedness within five (5) BusinessDays following the receipt thereof.

 

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(d)           If the Company incurs any Permitted Refinancing Indebtednesswith respect to any Other PrepaymentIndebtedness (including any partial Refinancings thereof), and such PermittedRefinancing Indebtedness consists of:

 

(i)                    Permitted Refinancing Indebtedness raisedin the debt capital markets, the Company shall apply 100% of the Net CashProceeds of such Permitted Refinancing Indebtedness to prepayment of the OtherPrepayment Indebtedness within five (5) Business Days following thereceipt thereof; or

 

(ii)                   any other Permitted RefinancingIndebtedness, the Company shall apply 100% of the Net Cash Proceeds of suchPermitted Refinancing Indebtedness to the prepayment of Mandatory PrepaymentIndebtedness within five (5) Business Days following the receipt thereof.

 

(e)           Any mandatory prepayment of Other PrepaymentIndebtedness shall be made on a prorata basis according to theOther Prepayment Pro Rata Amounts for such Other Prepayment Indebtedness.

 

(f)            Any mandatory prepayment of the Loans shall be paid inUS Dollars and applied to all Minor Derivative Counterparty Loans on a prorata basis according to each Minor Derivative Counterparty’s Pro RataShare.

 

2.06.        Repayment of the Loan.

 

The Company shall repay the principal amount of theLoan on the following dates inaccordance with the following amortization schedule:

 
| **Repayment Date**      | ** ** | **Amount** |
|-------------------------|------------|------------|
| August 21, 2010    |       | US$        | 895,833.33 |
| September 21, 2010 |       | US$        | 895,833.33 |
| October 21, 2010   |       | US$        | 895,833.33 |
| November 21, 2010  |       | US$        | 895,833.33 |
| December 21, 2010  |       | US$        | 895,833.33 |
| January 21, 2011   |       | US$        | 895,833.33 |
| February 21, 2011  |       | US$        | 895,833.33 |
| March 21, 2011     |       | US$        | 895,833.33 |
| April 21, 2011     |       | US$        | 895,833.33 |
| May 21, 2011       |       | US$        | 895,833.33 |
| June 21, 2011      |       | US$        | 895,833.33 |
| July 21, 2011      |       | US$        | 895,833.33 |
| August 21, 2011    |       | US$        | 895,833.33 |

 

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| September 21, 2011 |   | US$ | 895,833.33 |
|-------------------------|--------|-----|------------|
| October 21, 2011   |   | US$ | 895,833.33 |
| November 21, 2011  |   | US$ | 895,833.33 |
| December 21, 2011  |   | US$ | 895,833.33 |
| January 21, 2012   |   | US$ | 895,833.33 |
| February 21, 2012  |   | US$ | 895,833.33 |
| March 21, 2012     |   | US$ | 895,833.33 |
| April 21, 2012     |   | US$ | 895,833.33 |
| May 21, 2012       |   | US$ | 895,833.33 |
| June 21, 2012      |   | US$ | 895,833.33 |
| July 21, 2012      |   | US$ | 895,833.33 |

 

provided that the final installment payable by the Company on the Maturity Dateshall be in an amount, if such amount is different from that specified above,sufficient to repay the aggregate principal amount of the Loan outstanding onthe Maturity Date.

 

2.07.        Interest.

 

(a)           Subject to the provisions of clause (c) below, the Loan shall bear interest on the outstanding principalamount thereof for each Interest Period at a rate per annum equal to LIBOR plus the Applicable Margin.

 

(b)           Interest on the Loan shall be paid in arrears on eachInterest Payment Date.  Interest shallalso be paid on the date of any prepayment of the Loan under Section 2.04(*Voluntary Prepayments)* and Section 2.05(*Mandatory Prepayments*) withrespect to the portion of the Loan so prepaid, and upon payment (includingprepayment) in full of the Loan.  Duringthe existence of any Event of Default, interest shall be payable on demand.

 

(c)           Upon the occurrence and during the continuation of anEvent of Default, any amounts outstanding under the Loan (including any overdueprincipal and, to the extent permitted by applicable law, overdue interest orother amount payable hereunder) shall bear interest payable on demand, for eachday from the date payment thereof was due to the date of actual payment, at arate per annum equal to the Post-Default Rate.

 

2.08.        Computation of Interest and Fees.

 

(a)           Computation of the Alternate Base Rate, when theAlternate Base Rate is determined based on the Lender’s prime rate, shall becalculated on the basis of a year of three hundred sixty-five (365) or threehundred sixty-six (366) days, as the case may be, and the actual number of dayselapsed (including the first day but excluding the last day).  All other computations of interest and feeswhich are computed on a per annum basis shall be calculated 

 

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on the basis of a year of three hundred sixty (360)days and the actual number of days elapsed (including the first day butexcluding the last day).

 

(b)           Each determination of LIBOR and the Alternate BaseRate by the Lender shall be conclusive and binding on the Company and theLender in the absence of manifest error.

 

2.09.        Payments by the Company.

 

(a)           Subject to Section 3.01 (*Taxes*), all payments to be made by theCompany shall be made without condition or deduction for any set-off, counterclaimor other defense.  Except as otherwiseexpressly provided herein, all payments by the Company shall be made to theLender at the Lender’s Payment Office, and shall be made in US Dollars inimmediately available funds, no later than 11:00 A.M. (New York City time)on the date specified herein.  Anypayment received by the Lender later than 11:00 A.M. (New York City time)may be deemed, at the election of the Lender to have been received on thefollowing Business Day and any applicable interest or fee shall continue toaccrue.

 

(b)           Subject to the provisions set forth in the definitionof “Interest Period” herein, whenever any payment is due on a day other than aBusiness Day, such payment shall be made on the following Business Day, andsuch extension of time shall in such case be included in the computation ofinterest.

 

2.10.        Promise to Pay.  The Companyagrees to pay the principal amount of the Loan in installments on the dates andin the amounts set forth in Section 2.06 (*Repaymentof the Loans*) with a final installment on the Maturity Date, andfurther agrees to pay all unpaid interest accrued thereon, in accordance withthe terms of this Agreement and the Note.

 

ARTICLE IIITAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01.        Taxes.

 

(a)           Any and all payments by the Company to or for theaccount of the Lender pursuant to this Agreement and any other Loan Documentshall be made free and clear of, and without deduction or withholding for, anyIndemnified Taxes or Other Taxes except to the extent such deduction orwithholding is required by applicable law.

 

(b)           In addition, the Company shall pay all Other Taxes tothe relevant Governmental Authority in accordance with applicable law.

 

(c)           If the Company shall be required by law to deduct orwithhold any Indemnified Taxes or Other Taxes from or in respect of any sumpayable hereunder or under any other Loan Document to the Lender, then:

 

(i)                    the sum payable shall be increased asnecessary so that, after making all required deductions and withholdings(including deductions and withholdings applicable to additional sums payableunder this Section 3.01), the Lender receives and 

 

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retains an amount equal to the sum it would have received and retainedhad no such deductions or withholdings been made;

 

(ii)                   the Company shall make such deductionsand withholdings;

 

(iii)                  the Company shall pay the full amount deducted or withheld to therelevant Governmental Authority in accordance with applicable law; and

 

(iv)                  in the event of an increase, after thedate of this Agreement, in the Mexican withholding tax rate to a rate in excessof the rate applicable to the Lender party hereto on the date hereof, theCompany shall also pay to the Lender, at the time interest is paid, all additionalamounts that the Lender specifies as necessary to preserve the after-tax yieldthe Lender would have received if such Indemnified Taxes or Other Taxes had notbeen imposed;

 

provided, however, that the Company shall not berequired, except during an Event of Default (including with respect to paymentsused to cure an Event of Default), to increase any such amounts payable to anyLender with respect to withholding tax in excess of the rate applicable to aLender that is a Foreign Financial Institution.

 

(d)           Subject to the proviso contained in the last paragraphof Section 3.01(c) above, the Company agrees to indemnify and holdharmless the Lender for the full amount of (i) Indemnified Taxes and (ii) OtherTaxes (including deductions and withholdings applicable to additional sumspayable under this Section 3.01) in the amount that the Lender specifiesas necessary to preserve the after-tax yield the Lender would have received ifsuch Indemnified Taxes or Other Taxes had not been imposed, and any liability(including penalties, interest, additions to tax and expenses) arisingtherefrom or with respect thereto, whether or not such Indemnified Taxes orOther Taxes were correctly or legally asserted.

 

(e)           Within thirty (30) days after the date of any paymentby the Company of Indemnified Taxes or Other Taxes, the Company shall furnishto the Lender the original or a certified copy of a receipt evidencing paymentthereof or other evidence satisfactory to the Lender.

 

(f)            The Lender shall, at or before the time it becomes aLender hereunder and otherwise, if reasonably requested by the Company,promptly furnish to the Company such forms, documents or other information asmay be required by the Mexican tax law applicable at such time and which suchLender is eligible to provide under applicable law, in order to allow theCompany to make the corresponding gross up payments to such Lender and toestablish any available exemption from, or reduction in the amount of,applicable tax rates that the company may be required to withhold in accordancewith Mexican tax law; provided, however, that compliancewith requirements under this clause (f) shall not require registration ofa Lender as a Foreign Financial Institution or require a Lender to discloseinformation regarding the Lender’s tax affairs or computations or owners thatthe Lender in good faith considers to be confidential or otherwisedisadvantageous to disclose (including, in the case of a Lender that is a taxtransparent entity, any documentation from its owners) or would expose theLender to any unindemnified cost, risk or expense, or to provide any documents,forms, or other evidence that it is not legally 

 

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entitled to provide. The Lender agrees that, for the avoidance of doubt, the provision ofdocuments or other information relating solely to identity, nationality,residence or other similar information regarding the Lender (but not itsowners) would not, absent extraordinary circumstances, be confidential orotherwise disadvantageous to the Lender.

 

(g)           Should the Lender become subject to Taxes and not beentitled to indemnification under Section 3.01(c) or Section 3.01(d) withrespect to Taxes imposed by the relevant Governmental Authority, the Companyshall take such steps as the Lender shall reasonably request at the expense ofthe Lender to assist the Lender to recover such Taxes.

 

3.02.        Illegality.

 

(a)           If the Lender determines that any Requirement of Lawhas made it unlawful, or that any Governmental Authority has asserted that itis unlawful, for the Lender or its applicable Lending Office to make ormaintain its Loan contemplated by this Agreement (and, in the reasonableopinion of the Lender, the designation of a different applicable Lending Officewould either not avoid such unlawfulness or would be disadvantageous to theLender), then, on notice thereof by the Lender to the Company, the Lender shallbe an “Affected Lender” and by written notice to the Company:

 

(i)                    any obligation of such Affected Lender tomake or continue a Loan of that type shall be suspended until the circumstancesgiving rise to such determination no longer exist; and

 

(ii)                   subject to Section 3.09 (*Substitution of Lender*), the Lender’s Loanshall be prepaid by the Company, together with accrued and unpaid interestthereon and all other amounts payable to the Lender by the Company under theLoan Documents, on or before such date as shall be mandated by such Requirementof Law.

 

(b)           If the Lender determines that any Requirement of Lawhas made it unlawful, or that any Governmental Authority has asserted that itis unlawful or restricts the authority of the Lender to purchase or sell, or totake deposits of, US Dollars in the London interbank market, or to determine orcharge interest rates based upon LIBOR (and, in the reasonable opinion of theLender, the designation of a different applicable Lending Office would eithernot avoid such unlawfulness or would be disadvantageous to the Lender), then,on notice thereof by the Lender to the Company, the Lender shall be an AffectedLender and by written notice to the Company:

 

(i)                    the obligation of the Lender to make orcontinue a Loan bearing interest rates based on LIBOR shall be suspended untilthe circumstances giving rise to such determination no longer exist; and

 

(ii)                   subject to Section 3.09 (*Substitution of Lender*), the Loan of theAffected Lender shall bear interest at the Alternate Base Rate plus the Applicable Margin then in effect until the circumstancesgiving rise to such determination no longer exist.

 

(c)           For purposes of this Section 3.02, a notice tothe Company by the Lender shall be effective, if lawful, on the last day of theInterest Period currently applicable to the Loan; in all other cases suchnotice shall be effective on the date of receipt by the Company.

 

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3.03.        Inability to Determine Rates. If the Lender determines (which determination will be conclusive absentmanifest error) that (a) US Dollar deposits are not being offered to banksin the London interbank market for the applicable amount and Interest Period ofthe Loan, (b) adequate and reasonable means do not exist for determiningLIBOR applicable to such Interest Period, or (c) LIBOR for the Loan doesnot adequately and fairly reflect the cost to the Lender of making ormaintaining the Loan, the Lender will promptly notify the Company.  Thereafter, until the Lender revokes suchnotice, the Loan shall bear interest at the Alternate Base Rate plus the Applicable Margin then in effect.

 

3.04.        Increased Costs and Reduction of Return.

 

(a)           If the Lender reasonably determines that, due toeither (i) the introduction of, or any change in, or any change in theinterpretation or application of, any Requirement of Law or (ii) thecompliance by the Lender with any guideline, directive or request from anycentral bank or other Governmental Authority (whether or not having the forceof law), there shall be any increase in the cost to the Lender of agreeing tomake or making, funding or maintaining its Loan to the Company or to reduce anyamount receivable hereunder (in either case other than payment on account ofany Taxes referred to in Section 3.01 (*Taxes*)or any Excluded Taxes), then the Company shall be liable for, and shall fromtime to time, upon demand, promptly pay to the Lender additional amounts as aresufficient to compensate the Lender for such increased costs or reduced amountreceivable.

 

(b)           If the Lender reasonably determines that (i) theintroduction of any Capital Adequacy Regulation, (ii) any change in anyCapital Adequacy Regulation, (iii) any change in the interpretation oradministration of any Capital Adequacy Regulation by any central bank or otherGovernmental Authority charged with the interpretation or administrationthereof, or (iv) compliance by the Lender (or its Lending Office) with anyCapital Adequacy Regulation affects or would affect the amount of capitalrequired or expected to be maintained by the Lender or any corporationControlling the Lender and determines that the amount of such capital isincreased as a consequence of its Loan or obligations under this Agreement,then, upon demand of the Lender to the Company, the Company shall pay to theLender, from time to time as specified by the Lender, additional amountssufficient to compensate the Lender for such increase.

 

3.05.        Funding Losses.

 

(a)           The Company shall reimburse the Lender and hold theLender harmless from (in each case by prompt payment of any relevant amounts tothe Lender) any loss, cost or expense that the Lender may sustain or incur,including any loss incurred in obtaining, liquidating or redeploying depositsbearing interest by reference to LIBOR from third parties (“Funding Losses”)as a consequence of any of the following events (each a “Breakage Event”):

 

(i)                    the failure of the Company to make on atimely basis any scheduled payment of principal of the Loan;

 

(ii)                   the failure of the Company to borrow the Loan on the Closing Dateproposed in the Notice of Borrowing;

 

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(iii)                  the failure of the Company to make any voluntary prepayment inaccordance with any notice delivered under Section 2.04 (*Voluntary Prepayments*) or mandatoryprepayment in accordance with Section 2.05 (*Mandatory Prepayments*); or

 

(iv)                  the prepayment or repayment (includingpursuant to Section 2.04 (*VoluntaryPrepayments*), Section 2.05 (*MandatoryPrepayments)* or Section 2.06 (*Repaymentof the Loan*), but not including any mandatory prepayments pursuantto Section 2.05(b)) or other payment (including after accelerationthereof) of the Loan on a day that is not the last day of the relevant InterestPeriod therefor (including as a result of the replacement of the Lender with aSubstitute Lender pursuant to Section 3.09 (*Substitution of Lender*);

 

including in each case (x) any such loss orexpense arising from the liquidation or reemployment of funds obtained by theLender to maintain the Loan or from fees payable to terminate the deposits fromwhich such funds were obtained and (y) any customary and reasonableadministrative fees charged by the Lender in connection therewith.

 

(b)           The Funding Losses to the Lender shall be deemed toinclude an amount determined by the Lender to be the excess, if any, of (i) theamount of interest that would have accrued on the principal amount of the Loanhad such event not occurred, at an amount equal to LIBORfor the Interest Period during which such Breakage Event occurs, forthe period from the date of such Breakage Event to the end of the then currentInterest Period therefor, over (ii) the amount of interest that wouldaccrue on such principal amount for such period at the interest rate which theLender determines in good faith would bid were it to bid, at the beginning ofsuch period, for US Dollar deposits of a comparable amount and period fromother banks in the Eurodollar market.

 

3.06.        Reserves on Loan.  The Companyshall pay to the Lender, as long as the Lender shall be required to maintainreserves with respect to liabilities or assets consisting of or includingEurocurrency funds or deposits (currently known as “Eurocurrency Liabilities”),additional interest on the unpaid principal amount of the Loan equal to theactual costs of such reserves allocated to the Loan by the Lender (asdetermined by the Lender in good faith, which determination shall beconclusive, absent manifest error), payable on each date on which interest ispayable on the Loan, provided that the Company shall have received atleast fifteen (15) days’ prior written notice of such additional interest fromthe Lender.  If the Lender fails to givenotice fifteen (15) days prior to the relevant Interest Payment Date, suchadditional interest shall be payable fifteen (15) days from receipt of suchnotice.

 

3.07.        Certificates of the Lender.

 

(a)           Except as otherwise specified herein, the Lenderclaiming reimbursement or compensation under this Article III shalldeliver to the Company a certificate setting forth in reasonable detail theamount payable to the Lender hereunder and the reasons for such claim and suchcertificate shall be conclusive and binding on the Company in the absence ofmanifest error.  The Company shallpromptly pay the amount shown as due on any such certificate to the Lender, butin no case later than fifteen (15) days after receipt thereof.

 

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(b)           The Lender agrees to notify the Company of any claimfor reimbursement pursuant to Section 3.04 (*Increased Costs and Reduction of Return*) or 3.06 (*Reserves on Loan*) not later than onehundred eighty (180) days after any officer of the Lender responsible for theadministration of this Agreement receives actual knowledge of the event givingrise to such claim.  If the Lender failsto give such notice, the Company shall only be required to reimburse orcompensate the Lender, retroactively, for claims pertaining to the period ofone hundred eighty (180) days immediately preceding the date the claim wasmade.  However, if the change in aRequirement of Law (including any Capital Adequacy Regulation) giving rise tosuch increased cost or reduction is retroactive, then the one hundred eighty(180)-day period referred to above will be extended to include the period ofretroactive effect thereof.

 

3.08.        Change of Lending Office. The Lender agrees that, upon the occurrence of any event giving rise toan obligation of the Company under Section 3.01 (*Taxes*), Section 3.02 (*Illegality*), Section 3.04 (*Increased Costs and Reduction of Return*)or Section 3.06 (*Reserves on Loan*)with respect to the Lender, it will, if requested by the Company, usereasonable efforts (subject to overall policy considerations of the Lender) todesignate another Lending Office for the Loan affected by such event or takeother action; provided that the Lender and its Lending Office suffer noeconomic, legal or regulatory disadvantage, with the object of avoiding theconsequence of the event giving rise to the obligation under any suchSection.  Nothing in this Section shallaffect or postpone any of the Obligations of the Company or the rights of theLender provided in Section 3.01 (*Taxes*),Section 3.02 (*Illegality*), Section 3.04(*Increased Costs and Reduction of Return*)or Section 3.06 (*Reserves on Loan*).

 

3.09.        Substitution of Lender.  Upon the receiptby the Company from the Lender of a claim for compensation under Section 3.04(*Increased Costs and Reduction of Return*)or Section 3.06 (*Reserves on Loan*),or giving rise to the operation of Section 3.02 (*Illegality*), the Company may, at itsoption, (i) request the Lender to use its best efforts to seek aSubstitute Lender willing to assume the Lender’s Loan or (ii) replace theLender with a Substitute Lender or Substitute Lenders that shall succeed to therights and obligations of the Lender under this Agreement upon execution of anAssignment and Acceptance; provided, however, that the Lendershall not be replaced or removed hereunder until the Lender has been repaid infull all amounts owed to it pursuant to this Agreement and the other LoanDocuments (including Section 2.08 (*Computationof Interest and Fees*), Section 3.01 (*Taxes*), Section 3.04 (*IncreasedCosts and Reduction of Return*), Section 3.05 (*Funding Losses*) and Section 3.06 (*Reserves on Loan*)) unless any such amountis being contested by the Company in good faith.

 

3.10.        Survival.  Theagreements and obligations of the Company in this Article III shallsurvive the payment of all the Obligations.

 

ARTICLE IVCONDITIONS PRECEDENT

 

4.01.        Conditions to Closing Date. The obligation of the Initial Lender to make its Loan on the Closing Date is subject to the satisfaction (or waiverin writing by the Initial Lender in accordance with Section 9.01 (*Amendments and Waivers*)) of each of thefollowing conditions precedent:

 

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(a)           Loan Agreement and Note.  This Agreement, each other Loan Documentand the Intercompany Revolving Facilities shall have been duly executed by both of the parties hereto andthereto, the Note dated on the Closing Date shall have been duly executed bythe Company, and the Initial Lender shall have received from the Company acounterpart of this Agreement and each other Loan Document and IntercompanyRevolving Facility, the Initial Lender’s Note and all related documentationeach in form and substance satisfactory to the Initial Lender and signed by theCompany.

 

(b)           Organizational Documents; Resolutions; Incumbency. The Initial Lender shall have received copies of:

 

(i)                    the Organizational Documents of theCompany and Intercompany Lenders certified as of the Closing Date as true andcorrect and in full force and effect in their delivered form as of such date by(x) an appropriate Secretary or anAssistant Secretary ofthe Company or suchIntercompany Lender, as the case may be, as to effectiveness, and (y) in the case of the Company orIntercompany Lender organized under the laws of Mexico, a Mexican notary publicas to authenticity;

 

(ii)                   all applicable powers-of-attorney (*poderes*), designating the Personsauthorized to execute this Agreement, the other Loan Documents and theIntercompany Revolving Facilities on behalf of the Company and the IntercompanyLenders in each case (x) certified by a Mexican notary public (or a notarypublic in the jurisdiction under the laws of which such Person is organized), (y) certifiedas of the Closing Date by the Secretary or an Assistant Secretary of theCompany, or such Intercompany Lender, as the case may be, and (z) includingauthority for acts of administration and to subscribe, indorse and issue negotiableinstruments (*títulos de crédito*);and

 

(iii)                  a certificate of the Secretary or Assistant Secretary of the Company (x) certifyingthe names and true signatures of the Senior Officers of the Company authorizedto execute and deliver this Agreement, all other Loan Documents and theIntercompany Revolving Facilities to be delivered by the Company and theIntercompany Lenders hereunder and (y) attaching copies of all documentsevidencing all necessary corporate action (including any necessary resolutions of the Board of Directors or of theshareholders of the Company or Intercompany Lender) andgovernmental approvals, if any, with respect to the authorization for theexecution, delivery and performance of each such Loan Document and thetransactions contemplated hereby and thereby, which certificates shall statethat the resolutions or other information referred to in such certificates havenot been amended, modified, revoked or rescinded as of the date of suchcertificates.

 

(c)           Authorizations.  The InitialLender shall have received evidence satisfactory to it that all approvals,authorizations or consents of, or notices to, or filings or registrations with,any Governmental Authority (including exchange control approvals) or thirdparties, if any, required in connection with the execution, delivery andperformance by the Company of this Agreement or any other Loan Document (including withoutlimitation, with respect to the Intercompany Trust Agreement and theIntercompany Revolving Facilities) have been obtained and are in full force and effect.  If no such approvals, authorizations,consents, notices or registrations are 

 

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necessary, the Initial Lender shall have received acertificate executed by a Senior Officer of the Company so stating.

 

(d)           Process Agent.  The InitialLender shall have received (i) copies of irrevocable powers of attorneyfor lawsuits and collections (*poderirrevocable para pleitos y cobranzas*) granted by the Company,certified by a Mexican notary public, in form reasonably satisfactory to theInitial Lender, irrevocably appointing each of the Process Agent and theAlternate Process Agent to act as such on behalf of the Company under thisAgreement and each of the other Loan Documents and (ii) an acceptanceletter duly executed and delivered by the Process Agent and the AlternateProcess Agent dated on or prior to the date hereof pursuant to which each agentirrevocably consents to and accepts its appointment as ProcessAgent or Alternate Process Agent for the Company under and for the term of thisAgreement and each of the other Loan Documents that requires such anappointment in connection with any Proceeding relating to this Agreement or theNote or the transactions contemplated under anyof the Loan Documents.

 

(e)           Legal Opinions.   The InitialLender shall have received (i) an opinion of Mijares, Angoita, Cortés yFuentes, special Mexican counsel to the Company, substantially in the form of Exhibit D;(ii) an opinion of Milbank, Tweed, Hadley & McCloy LLP, specialNew York counsel to the Company, substantially in the form of Exhibit E-1;(iii) an opinion of Salvador Vargas Guajardo, General Counsel to theCompany, substantially in the form of Exhibit E-2; (iv) afavorable opinion of White & Case S.C., special Mexican counsel to theInitial Lender; and (v) a favorable opinion of CGSH, specialNew York counsel to the Initial Lender.

 

(f)            Payment of Fees.   The InitialLender shall have received evidence of payment of the fees and expenses thendue and payable under each of the Advisor Fee Letters and under this Agreement or theother Loan Documents, including trustees’ and advisors’ fees and AttorneyCosts, plus such additional amounts of Attorney Costs as shall constitute itsreasonable estimate of Attorney Costs incurred or to be incurred through theclosing proceedings, and anyother fees required to be paid on or prior to the Closing Date.

 

(g)           Changes in Condition.

 

(i)                    The representations and warranties of theCompany contained in this Agreement or in any other Loan Document shall be trueand correct as of the Closing Date, except to the extent that suchrepresentations and warranties specifically refer to an earlier date, in whichcase they shall be true and correct as of such earlier date.

 

(ii)                   The Company shall be in compliance withall of its covenants and agreements contained in the Loan Documents and the IntercompanyRevolving Facilities.

 

(iii)                  There shall not have occurred since the date of the audited financialstatements of the Company and its Consolidated Subsidiaries described in clause(o) below, a Material Adverse Effect, except as otherwise disclosed in theCompany’s public filings with the US Securities and Exchange Commission or theComisión Nacional Bancaria y de Valores prior to the date hereof and listed on Schedule5.06(c) (*Existing Material AdverseEffects*).

 

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(iv)                  No Default or Event of Default shall haveoccurred and be continuing either prior to or after giving effect to thetransactions (including any transactions with respect to the Other RestructuredIndebtedness) contemplated on the Closing Date.

 

(v)                   There shall have occurred no circumstance and/or event of a financial,political or economic nature in Mexico or in the international financial,banking or capital markets that has a reasonable likelihood of having aMaterial Adverse Effect on the Company and its Subsidiaries.

 

(vi)                  No default shall have occurred and be continuing on any materialIndebtedness of the Company or any of its Subsidiaries (including the Bank ofAmerica Facility and the Bancomext-Gimsa Loan).

 

(vii)                 The Initial Lender shall have received a certificate signed by thechief financial officer and one additional Senior Officer of the Company, datedas of the Closing Date, to the effect that, both before and after giving effectto the transactions contemplated by the Loan Documents and the Intercompany RevolvingFacilities, each of the conditions precedent in clauses (i) through(vi) above are true and correct

 

(h)           Payment of Interest under Confirmation. All interest payable in respect of the Terminated Derivative Obligationpursuant to the Confirmation shall have been paid in US Dollars and inimmediately available funds no later than 11:00 a.m. (New York City time)on the Closing Date.  For the avoidanceof doubt, such interest shall have been payable at a rate equal to the sum ofLIBOR plus (i) 1.00% per annum, from and including the date ofConfirmation to, but excluding, August 10, 2009, (ii) 2.875% perannum, from and including August 10, 2009 to, but excluding, September 21,2009, (iii) 4.875% per annum, from and including September 21, 2009to, but excluding, 5:00 p.m. (New York time) on October 13, 2009, and(iv) 5.875% per annum, from and including 5:00 p.m. (New York time)on October 13, 2009 to, but excluding, the Closing Date.

 

(i)            Control Agreement.  The Companyshall have entered into the Control Agreement with the Initial Lender and thebank where the Temporary Loan Account for the Initial Lender is located, onterms and conditions satisfactory to the Initial Lender.

 

(j)            Intercompany Trust Agreement.

 

(i)                            The Intercompany Trust Agreement shallhave been duly executed by the parties thereto in form and substancesatisfactory to the Lender, and shall be in full force and effect and theCollateral Agent (or its counsel) shall have received from the Company acounterpart of such Intercompany Trust Agreement signed on behalf of suchparty.

 

(ii)                           The Collateral Agent shall have receivedsatisfactory evidence of notice and acknowledgment being delivered to theborrowers under the Intercompany Revolving Facilities regarding the transfer ofthe rights of the Intercompany Lenders (other than Subsidiaries in the GimsaDivision) to the Intercompany Trust Agreement.

 

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(k)           Legal Matters.  NoRequirement of Law, shall in the reasonable judgment of the Initial Lender,restrain, prevent, or impose materially adverse conditions upon the execution and delivery of,and performance under, the Loan Documents or the Intercompany RevolvingFacilities or the transactions contemplated hereby and under the otherLoan Documents andthe Intercompany Revolving Facilities andall corporate and other proceedings and all documents and other legal mattersin connection with the transactions contemplated hereby and under the LoanDocuments and theIntercompany Revolving Facilities.

 

(l)            Restructured or Refinanced Indebtedness. The Other Restructured Indebtedness shall have been executed anddelivered by the Company, and shall have been funded or settled by thecounterparties thereto.

 

(m)          Delivery of Reporting Indebtedness Documents. The Company shall have provided the Initial Lender with copies of allContractual Obligations for all of the Reporting Indebtedness (such ContractualObligations, the “Reporting Indebtedness Documentation”).

 

(n)           No Litigation.  There shallbe no pending or, to the best knowledge of the Company, threatened Proceeding(including a bankruptcy, *concurso*or other insolvency proceeding) with respect to this Agreement or the otherLoan Documents andthe Intercompany Revolving Facilities or the transactions contemplatedhereby or thereby, or that could reasonably be expected to have a MaterialAdverse Effect.

 

(o)           Delivery of Financial Statements. The Initial Lender shall have received (i) the audited financialstatements described in Section 6.01(a) (*Financial Statements and Other Information*) for the FiscalYear ending on December 31, 2008, provided that such auditedfinancial statements may contain the “going concern” qualification disclosed inthe financial statements contained in Item 18 of the Company’s annual report onForm 20-F filed with the US Securities and Exchange Commission on June 30,2009; and (ii) the unaudited financial statements described in Section 6.01(b) (*Financial Statements and Other Information*)for the Fiscal Quarters ending on March 31, 2009 and June 30, 2009 (or, with respect to GrumaCorp., on June 27, 2009).

 

(p)           Patriot Act. The Initial Lender shall have received (for itselfand as requested by the Initial Lender) any documents or information reasonablyrequired to obtain, verify and record information that identifies the Companyand its Subsidiaries, which information may include (but shall not be limitedto) the name and address of the Company and its Subsidiaries and any otherinformation that will allow such the Initial Lender to identify the Company andits Subsidiaries in accordance with the Patriot Act.

 

(q)           Delivery of Notice of Borrowing. The Initial Lender shall have received a Notice of Borrowing from theCompany signed by a Senior Officer of the Company.

 

(r)            Solvency.  The Company and eachMaterial Operating Subsidiary, after giving effect to the transactionscontemplated hereby and by the other Loan Documents and the IntercompanyRevolving Facilities, shall be Solvent and the Initial Lender shall havereceived a certificate from the chief financial officer of the Company to sucheffect.

 

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(s)           Intercompany Revolving Facilities.  The Intercompany Revolving Facilities and theIntercompany Trust Agreement shall be in full force and effect and the Lenderand the Collateral Agent shall have copies of all definitive documentation (andany amendments thereto) and Contractual Obligations with respect to theIntercompany Revolving Facilities and the Intercompany Trust Agreement.

 

(t)            Other Documents.  The InitialLender shall have received such other certificates, powers of attorney,approvals, opinions, documents or materials as the Initial Lender mayreasonably request.

 

ARTICLE VREPRESENTATIONS AND WARRANTIES

 

The Company represents and warrants to the Lenderthat:

 

5.01.        Corporate Existence and Power. The Company and each of its Subsidiaries:

 

(a)           is a corporation duly organized and validly existingunder the laws of the jurisdiction of its organization and, to the extentapplicable under the laws of its jurisdiction of organization, is in goodstanding;

 

(b)           is qualified to do business in every jurisdictionwhere such qualification is required, except where the failure to be qualifiedhas not had and could not reasonably be expected to have a Material AdverseEffect;

 

(c)           has all requisite corporate power and authority andall requisite governmental licenses, authorizations, consents and approvals to (i) conductits business as now conducted and as proposed to be conducted and to own itsProperties, except to the extent that the failure to obtain any suchgovernmental license, authorization, consent or approval has not had and couldnot reasonably be expected to have a Material Adverse Effect, and (ii) execute,deliver and perform all of its obligations under each of the Loan Documents and the IntercompanyRevolving Facilities and eachother agreement or instrument contemplated thereby to which it is or will be aparty and receive the Loan hereunder; and

 

(d)           is in compliance with all Requirements of Law, exceptto the extent that the failure to comply therewith has not had and could notreasonably be expected to have a Material Adverse Effect.

 

5.02.        Corporate Authorization; No Contravention. The execution and delivery of, and performance by the Company under,this Agreement and each other Loan Document to which it is a party have beenduly authorized by all necessary corporate and, if required, stockholder action and do not and will not:

 

(a)           contravene the terms of the Company’s or any of itsSubsidiaries’ Organizational Documents; or

 

(b)           conflict or be inconsistent with or result in anybreach, violation or contravention of (alone or with notice or the lapse oftime or both), or the creation of any Lien under, or give

 

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rise to any right to accelerate or to require the prepayment, repurchaseor redemption of any obligation under or constitute a default in respect of (i) any document evidencing anyContractual Obligation to which the Company or any of its Subsidiaries is aparty or (ii) any Requirement of Law to which the Company or any of itsSubsidiaries or their respective Property is subject.

 

5.03.        No Additional Authorizations. No approval (including exchange control approval), consent, exemption,authorization, registration or other action by, or notice to, or filing with,any Governmental Authority or other third party is necessary or required inconnection with the execution, delivery or performance by, or enforcementagainst, the Company of this Agreement or any other Loan Document other than ashave been obtained pursuant to Section 4.01(c) (*Authorizations*).

 

5.04.        Binding Effect.  ThisAgreement has been, and each other Loan Document, when delivered hereunder,will have been, duly executed and delivered by the Company.  This Agreement constitutes, and each otherLoan Document when so delivered will constitute, a legal, valid and bindingobligation of the Company, enforceable against the Company in accordance withits terms, except as enforceability may be limited by applicable bankruptcy,insolvency, *concurso mercantil*, *quiebra*, or similar laws affecting theenforcement of creditors’ rights generally or by equitable principles relatingto enforceability (regardless of whether enforcement thereof is sought in aProceeding at law or in equity).

 

5.05.        Litigation.  Except asdisclosed in Schedule 5.05 (*PendingLitigation*), there are no Proceedings pending, or to the bestknowledge of the Company, threatened or contemplated, at law, in equity, inarbitration or before any Governmental Authority, by or against the Company orany of its Subsidiaries, which:

 

(a)           could reasonably be expected to affect the legality,validity or enforceability of this Agreement or any other Loan Document, or anyof the transactions contemplated hereby or thereby; or

 

(b)           could reasonably be expected to have a materialadverse effect on the ability of the Company to perform its obligations underany Loan Document; or

 

(c)           that, in the aggregate, could reasonably be expectedto have a Material Adverse Effect

 

5.06.        Financial Information; No Material Adverse Effect; NoDefault; No Contingent Liabilities.

 

(a)           The Company’s audited consolidated financialstatements for the Fiscal Year ended December 31, 2008 (copies of whichhave been furnished to the Lender) (i) are complete and correct in allmaterial respects, (ii) have been prepared in accordance with Mexican GAAPapplied on a consistent basis and fairly present in accordance with MexicanGAAP the financial condition of the Company and its Consolidated Subsidiariesas of such date and the results of their operations for the Fiscal Year ended December 31,2008, and (iii) have been audited and certified by independent certifiedpublic accountants of international standing.

 

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(b)           The Company’s unaudited financial statements for eachof the Fiscal Quarters ended March 31, 2009 and June 30, 2009 (copiesof which have been furnished to the Lender) (i) are complete and correctin all material respects and (ii) have been prepared in accordance withMexican GAAP applied on a consistent basis and fairly present in accordancewith Mexican GAAP the financial condition of the Company and its ConsolidatedSubsidiaries as of such date and the results of their operations for the periodcovered thereby, subject to the absence of footnotes and to normal year-endaudit adjustments.

 

(c)           Since the date of the most recent audited financialstatements, there has occurred no development, event or circumstance which hashad or could reasonably be expected to have a Material Adverse Effect, exceptas otherwise disclosed in the Company’s public filings with the US Securitiesand Exchange Commission or the Comisión Nacional Bancaria y de Valores**and listed on Schedule 5.06(c) *(Existing Material Adverse Effects)*.

 

(d)           As of the Closing Date, neither the Company nor any ofits Subsidiaries is in default under or with respect to any ContractualObligation in any respect which has had or could reasonably be expected to havea Material Adverse Effect, or that would, if such default had occurred afterthe Closing Date, create an Event of Default under Section 8.01(e) (*Cross-Default*).

 

(e)           Except as set forth on Schedule 5.06(e) (*Material Contingent Liabilities, Forward or Long-TermCommitments, Unrealized Losses*), none of the Company or itsConsolidated Subsidiaries has any material contingent liabilities, materialforward or long-term commitments or unrealized losses except as disclosed inthe financial statements described in clauses (a) or (b) above.

 

5.07.        Pari Passu.  TheObligations constitute direct, unconditional and general obligations of theCompany and rank at least *pari passu*inall respects with all other unsecured and unsubordinated Indebtedness of theCompany, except such Indebtedness ranking senior by operation of law (and notby contract or agreement), which, in any event, is not material to the Company.

 

5.08.        Taxes.  The Companyand each of its Subsidiaries have timely filed all federal (Mexican), state,provincial, local and foreign (non-Mexican) tax returns and reports required tobe filed, and have timely paid all taxes, assessments, fees and othergovernmental charges levied or imposed upon them or their Properties, includingrelated interest and penalties, otherwise due and payable, except (a) thosewhich are being contested in good faith by appropriate proceedings and forwhich adequate reserves have been provided in accordance with Mexican GAAP (or,in the case of Persons organized under laws of any other jurisdiction, theapplicable GAAP therein) and (b) those tax returns or taxes for which suchfailure to timely file or timely pay (as the case may be) could not reasonablybe expected to have a material adverse effect on the business, financialcondition or operations of the Company or such Subsidiary.

 

5.09.        Environmental Matters.

 

(a)           The on-going operations of the Company and each of itsSubsidiaries are, and during the past five (5) years have been, incompliance in all material respects with all applicable

 

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Environmental Laws except as set forth on Schedule5.09 (*Environmental Matters*) orexcept to the extent that the failure to comply therewith has not had and couldnot reasonably be expected to have a Material Adverse Effect;

 

(b)           The Company and each of its Subsidiaries have obtainedall material environmental, health and safety permits necessary or required forits operations, all such permits are in good standing, and the Company and eachof its Subsidiaries is and has been in compliance in all material respects withall applicable terms and conditions of such permits, except as set forth onSchedule 5.09 (*Environmental Matters*)or except to the extent that the failure to obtain, and maintain in full forceand effect, any such permit, or to the extent that failure to comply with thematerial terms thereof, has not had and could not reasonably be expected tohave a Material Adverse Effect;

 

(c)           Neither the Company nor any of its Subsidiaries isconducting, or to the best knowledge of the Company after reasonableinvestigation, is required to conduct, any investigations or remediation ofhazardous substances under any applicable Environmental Law at any propertycurrently or formerly owned or operated by the Company or any Subsidiary(including soils, groundwater, surface water, buildings or other structures)except as set forth on Schedule 5.09 (*EnvironmentalMatters*) or except as has not had and could not reasonably beexpected to have a Material Adverse Effect; and

 

(d)           Neither the Company nor any of its Subsidiaries hasreceived any notice, demand, letter, claim or request for informationindicating that it may be in violation of or subject to liability under anyEnvironmental Law, including any liability for any release of any hazardoussubstance on any third party property, or is subject to any order, decree,injunction or other arrangement with any Governmental Authority relating to anyEnvironmental Law, except as set forth on Schedule 5.09 (*Environmental Matters*) or except as hasnot had and could not reasonably be expected to have a Material Adverse Effect.

 

5.10.        Compliance with Social Security Legislation, Etc. The Company and each of its Subsidiaries is in compliance with allRequirements of Law relating to social security legislation, including all rules andregulations of INFONAVIT, IMSS and SAR except to the extent that non­compliancetherewith has not had during the preceding five (5) calendar years, andcould not be reasonably expected to have, a Material Adverse Effect.

 

5.11.        Assets; Patents; Licenses; Insurance; Etc.

 

(a)           The Company and each of its Material Subsidiaries hasgood and marketable title to, or valid leasehold interests in, all Propertythat is reasonably necessary to, or used in the ordinary conduct of, or isotherwise material to its business, and has no knowledge of any pending orcontemplated condemnation proceeding, or Disposition in lieu of suchproceedings, with respect to such Property except as the foregoing may notreasonably be expected to have a Material Adverse Effect.

 

(b)           The Company and each of its Material Subsidiaries ownor are licensed or otherwise have the right to use all of the materialtrademarks, trade names, copyrights, patents, contractual franchises, licenses,authorizations, other intellectual property and other rights that

 

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are reasonably necessary for the operation of theirrespective business, without conflict with the rights of any other Personexcept as the foregoing may not reasonably be expected to have a MaterialAdverse Effect.

 

(c)           None of the Property of the Company or any of itsSubsidiaries is subject to any Liens except as permitted by Section 7.01 (*Negative Pledge*).

 

(d)           Neither the Company nor any of its Subsidiaries areparty to any Sale Lease-Back Transactions except as set forth in Schedule 5.11(d) (*Existing Sale Lease-Back Transactions*)(the “Existing Sale Lease-Back Transactions”).

 

(e)           The Company and each of its Material Subsidiaries haveinsurance with financially sound, responsible and reputable insurance companiesin such amounts and covering such risks as are usually carried by companies ofgood repute engaged in similar businesses and owning and/or operatingproperties similar to those owned and/or operated by the Company or suchSubsidiary, as the case may be, in the same general areas in which the Companyor such Subsidiary owns and/or operates its properties, in accordance withnormal industry practice.

 

5.12.        Subsidiaries.

 

(a)           A complete and correct list of all Subsidiaries of theCompany, showing the correct name thereof, the jurisdiction of itsincorporation and the percentage of shares of each class of capital stockoutstanding owned by the Company and each Subsidiary of the Company is setforth in Schedule 5.12(a) (*Subsidiaries*).  All such shares of capital stock are fullypaid and non-assessable and are owned by the Company or one or more of itsSubsidiaries free and clear of all Liens (other than the Liens created under any of the security documents in respect ofthe Secured Indebtedness).  There are nooutstanding options, warrants, rights of conversion or similar rights withrespect to such capital stock.

 

(b)           A list of all agreements, which by their terms,expressly prohibit or limit the payment of dividends or other distributions tothe Company by a Subsidiary or the making of loans to the Company by aSubsidiary is set forth in Schedule 5.12(b) (*Restrictive Subsidiary Agreements*).

 

5.13.        Commercial Acts.  TheObligations of the Company under the Loan Documents are commercial in natureand are subject to civil and commercial law with respect thereto.  The execution and performance of the LoanDocuments by the Company constitute private and commercial acts and notgovernmental or public acts.  The Companyand its Property is subject to legal action in respect of its Obligations andis not entitled to immunity on the grounds of sovereignty or otherwise from thejurisdiction of any court or from any legal process (whether through service ornotice, attachment prior to judgment, attachment in aid of execution, executionor otherwise) in connection therewith. If the Company or any of its Property should become entitled to any suchright of immunity, the Company has effectively waived such right pursuant to Section 9.16(*Waiver of Immunity*).

 

5.14.        Proper Legal Form.  Each of theLoan Documents is (or if not yet executed, when executed and delivered, willbe) in proper legal form under any Requirements of Law for the enforcementthereof against the Company in accordance with their respective terms undersuch

 

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Requirements of Law. To ensure the legality, validity, enforceability or admissibility intoevidence of the Loan Documents, it is not necessary that any of such LoanDocuments or any other document be filed or recorded with any applicableGovernmental Authority or that any stamp or similar tax be paid on or in respectof any Loan Document.  Any judgmentagainst the Company of a state or United States federal court in the State ofNew York, United States arising from, related to or in connection with any LoanDocument is capable of being enforced in the courts of Mexico; providedthat in the event any legal Proceedings are brought in the courts of Mexico, aSpanish translation of the documents, including this Agreement, prepared by acourt-approved translator would be required in such Proceedings.  It is not necessary in order for the Lenderto enforce any rights or remedies under the Loan Documents, or solely by reasonof the execution, delivery and performance by the Company of the LoanDocuments, that the Lender be licensed or qualified with any Mexican GovernmentalAuthority or be entitled to carry on business in Mexico.

 

5.15.        Full Disclosure.  All writteninformation other than forward-looking information heretofore furnished by theCompany or its Subsidiaries, or their respective agents or representatives tothe Lender for purposes of or in connection with this Agreement or the otherLoan Documents or the Intercompany Revolving Facilities or thetransactions contemplated hereby or thereby, and all such information hereafter furnished by theCompany or its Subsidiaries, or their respective agents or representatives tothe Lender, is or will be true and accurate in all material respects on thedate as of which such information is stated or certified, and does not and willnot contain any material misstatement of fact or, taken as a whole, omit tostate any material fact necessary to make the statements therein, in light ofthe circumstances in which they were made, not misleading on the date on whichsuch information was furnished.  Allwritten forward-looking information heretofore furnished in writing to theLender has been prepared by the Company or its Subsidiaries in good faith basedupon assumptions the Company believes to be reasonable.  The Company has disclosed to the Lender inwriting any and all facts known to it that have or have had or it believescould reasonably be expected to have had or have a Material Adverse Effect.

 

5.16.        Investment Company Act.  Both immediately before andafter giving effect to this Agreement and the transactions contemplated herein,neither the Company nor any of its Subsidiaries is, or will be requiredto register as, an “investment company” or an “affiliated person” or “promoter” of, or “principalunderwriter” of or for, an “investment company”, as such terms are defined in the Investment Company Act of1940, as amended.

 

5.17.        Margin Regulations.  Neither the Company nor any of its Subsidiaries isgenerally engaged in the business of purchasing or selling “margin stock” (assuch term is defined in Regulations T, U or X of the Board of Governors of theFederal Reserve System of the United States) or extending credit for thepurpose of purchasing or carrying margin stock. No part of the proceeds of the Loan will be used, whether directly orindirectly, and whether immediately, incidentally or ultimately, for anypurpose that entails a violation of, or that is inconsistent with, theprovisions of Regulation T, U or X of the Board of Governors of the USFederal Reserve System,or that entails a violation by the Company of any other regulations of theBoard of Governors of the US Federal Reserve System.

 

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5.18.        ERISA Compliance; Labor Matters.

 

(a)           Each Plan is in compliance in all material respectswith the applicable provisions of ERISA, the Code and other federal or statelaws and the regulations and published interpretations thereunder.  Each Plan that is intended to qualify under Section 401(a) ofthe Code has received a favorable determination letter from the IRS or anapplication for such a letter is currently being processed by the IRS withrespect thereto and, to the best knowledge of the Company, nothing has occurredwhich would prevent, or cause the loss of, such qualification.  The Company and each ERISA Affiliate havemade all required contributions to each Plan subject to Section 412 of theCode, and no application for a funding waiver or an extension of anyamortization period pursuant to Section 412 of the Code has been made withrespect to any Plan.

 

(b)           There are no pending or, to the best knowledge of theCompany, threatened claims, actions or lawsuits, or action by any GovernmentalAuthority, with respect to any Plan that could be reasonably expected to have aMaterial Adverse Effect.  There has beenno prohibited transaction or violation of the fiduciary responsibility rules withrespect to any Plan that has resulted or could be reasonably expected to resultin a Material Adverse Effect.

 

(c)           (i) No ERISA Event has occurred, or to the bestknowledge of the Company, is reasonably expected to occur and no condition orevent currently exists or is reasonably expected to occur that could result inan ERISA Event; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neitherthe Company nor any ERISA Affiliate has incurred, or reasonably expects toincur, any liability under Title IV of ERISA with respect to any Pension Plan(other than premiums due and not delinquent under Section 4007 of ERISA; (iv) noevent, condition or amendment has occurred, is planned or is reasonablyexpected to occur which could require the Company or any ERISA Affiliate topost security with respect to any Plan and no such event, condition oramendment is planned or is reasonably expected to occur; (v) no PensionPlan has failed to satisfy the minimum funding standard, whether or not waived,under Section 302 of ERISA or Section 412 of the Code; (vi) theCompany and each ERISA Affiliate has made all contributions required to be madeby such person to each Plan as and when such contributions have become due; (vii) neitherthe Company nor any ERISA Affiliate is required to file with the PBGC theinformation required under Section 4010 of ERISA with respect to anyPension Plan; (viii) neither the Company nor any ERISA Affiliate hasincurred, or reasonably expects to incur, any liability (and no event hasoccurred which, with the giving of notice, under Section 4219 of ERISA,would result in such liability) under Section 4201 or 4243 of ERISA withrespect to a Multiemployer Plan; (ix) no Multiemployer Plan is in “endangered”or “critical” status within the meaning of Section 305 of ERISA; (x) neitherthe Company nor any ERISA Affiliate has incurred any unsatisfied, or isreasonably expect to incur any, Withdrawal Liability to any Multiemployer Plan;(xi) neither the Company nor any ERISA Affiliate has received any notificationthat any Multiemployer Plan is in reorganization or will terminate or has beenterminated, and, to the best knowledge of the Company, no Multiemployer Plan isreasonably expected to be in reorganization or to be terminated; (xii) if theCompany and all ERISA Affiliates were to completely withdraw from allMultiemployer Plans, neither the Company nor any ERISA Affiliate would incur,directly or indirectly, any Withdrawal Liability; and (xiii) neither theCompany nor any ERISA Affiliate has engaged in a transaction that could besubject to Sections 4069 or 4212(c) of ERISA, except, in each case, aswould not be expected to have a material adverse effect on the business,financial condition or operations of the Company or such Subsidiary.

 

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(d)           Each Foreign Pension Plan is in compliance in allmaterial respects with all requirements of law applicable thereto and therespective requirements of the governing documents for such plan. With respectto each Foreign Pension Plan, none of the Company or its Subsidiaries or any oftheir respective directors, officers, employees or agents has engaged in atransaction which would subject the Company or any Subsidiary, directly orindirectly, to a tax or civil penalty which could reasonably be expected toresult in a Material Adverse Effect. With respect to each Foreign Pension Plan,reserves have been established in the financial statements furnished to theLender to the extent required by Section 6.01 (*Financial Statements and Other Information*) in respect ofany unfunded liabilities in accordance with all Requirements of Law or, whererequired, in accordance with ordinary accounting practices in the jurisdictionin which such Foreign Pension Plan is maintained. The aggregate unfundedliabilities with respect to such Foreign Pension Plans could not reasonably beexpected to result in a Material Adverse Effect; the present value of theaggregate accumulated benefit liabilities of all such Foreign Pension Plans(based on those assumptions used to fund each such Foreign Pension Plan) didnot, as of the last annual valuation date applicable thereto, exceed by morethan US$20,000,000 the fair market value of the assets of all such ForeignPension Plans.

 

(e)           None of the Company or any of its Subsidiaries are aparty to any labor dispute that could reasonably be expected to have a MaterialAdverse Effect, and there are no strikes, walkouts, lockouts or slowdownsagainst the Company or its Subsidiaries pending or, to the best knowledge ofthe Company or its Subsidiaries, threatened, except as would not be expected tohave a material adverse effect on the business, financial condition oroperations of the Company or such Subsidiary. There is no unfair labor practice complaint pending against any of theCompany or its Subsidiaries or, to the best knowledge of any of the Company orits Subsidiaries, threatened against any of them that could reasonably be expectedto have a Material Adverse Effect.  Thereis no grievance or significant arbitration Proceeding arising out of or underany collective bargaining agreement pending against any of the Company or itsSubsidiaries or, to the best knowledge of any of the Company or itsSubsidiaries, threatened against any of them, in each case that couldreasonably be expected to have a Material Adverse Effect.

 

5.19.        Anti-Terrorism Laws.

 

(a)           Neither the Company nor any of its Affiliates is inviolation of any laws relating to terrorism or money laundering (“Anti-TerrorismLaws”), including Executive Order No.  13224 on Terrorist Financing,effective September 24, 2001 (the “Executive Order”), and theUniting and Strengthening America by Providing Appropriate Tools Required toIntercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (the “PatriotAct”).

 

(b)           Neither the Company nor any of its Affiliates actingor benefiting in any capacity in connection with the Loan is any of thefollowing:

 

(i)                    a Person or entity that is listed in theannex to, or is otherwise subject to the provisions of, the Executive Order;

 

(ii)                   a Person or entity owned or Controlledby, or acting for or on behalf of, any Person or entity that is listed in theannex to, or is otherwise subject to the provisions of, the Executive Order;

 

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(iii)                  a Person or entity with which the Lender is prohibited from dealing orotherwise engaging in any transaction by any Anti-Terrorism Law;

 

(iv)                  a Person or entity that commits,threatens or conspires to commit or supports “terrorism” as defined in theExecutive Order; or

 

(v)                   a Person or entity that is named as a “speciallydesignated national and blocked person” on the most current list published bythe US Treasury Department Office of Foreign Assets Control (“OFAC”) atits official website or any replacement website or other replacement officialpublication of such list.

 

(c)           Neither the Company nor any of the Company’sAffiliates acting in any capacity in connection with the Loan (i) conductsany business or engages in making or receiving any contribution of funds, goodsor services to or for the benefit of any Person described in clause (b)(ii) above,(ii) deals in, or otherwise engages in any transaction relating to, anyproperty or interests in property blocked pursuant to the Executive Order or (iii) engagesin or conspires to engage in any transaction that evades or avoids, or has thepurpose of evading or avoiding, or attempts to violate, any of the prohibitionsset forth in any Anti-Terrorism Law.

 

5.20.        Existing Indebtedness and Reporto Contracts.

 

(a)           Set forth on Schedule 5.20(a) (*Existing Indebtedness*) is a complete andaccurate list of all Existing Indebtedness that is (i) Working CapitalIndebtedness (the “Existing Working Capital Indebtedness”) and (ii) OtherIndebtedness (including all Guaranty Obligations) (the “Existing OtherIndebtedness”), in each case specifying the parties thereto, theoutstanding principal amounts thereof, any unborrowed amounts thereof and anyguarantors thereof.

 

(b)           Set forth on Schedule 5.20(b) (*Existing Intercompany Indebtedness*) is acomplete and accurate list of all Intercompany Indebtedness as of September 30,2009, specifying the parties thereto and outstanding principal amountsthereof.  All Existing IntercompanyIndebtedness (other than Intercompany Indebtedness owed to any Subsidiary inthe Gimsa Division by the Company and Guaranty Obligations by the Company thatare permitted by Section 7.16(e) or 7.16(h) (*Limitations on Incurrence of Additional Indebtedness*))has been issued or made pursuant to the Intercompany Revolving Facilities.

 

(c)           Set forth on Schedule 5.20(c) (*Existing Hedging Agreements*) is a completeand accurate list of the parties to which the Company has any liability underHedging Agreements and the notional amounts and the Agreement Values thereof,as of the Business Day prior to the date hereof (or such earlier date asmutually agreed prior to the Closing Date between the Company and the InitialLender), and theCompany has provided reasonable documentation supporting the Agreement Values setforth in respect thereof**.**

 

(d)           Set forth on Schedule 5.20(d) (*Existing Reporto Contracts*) is a completeand accurate list of any outstanding Reporto Contract entered into with theCompany or any of its Subsidiaries, and the aggregate principal amount thereof,as of the Business Day prior to the date hereof.

 

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(e)           Each of the Reporting Indebtedness Documentation is atrue and correct copy of such Contractual Obligation, and (i) the Companyhas not entered into any Contractual Obligations in respect of the ReportingIndebtedness otherthan the Reporting Indebtedness Documentation and (ii) the Company has notpaid any fees or made any other payment (and no fee or other payment ispayable) in respect of the Reporting Indebtedness other than as expresslyprovided in Reporting Indebtedness Documentation.

 

(f)            Since the date of the audited financial statements ofthe Company and its Consolidated Subsidiaries described in Section 4.01(o) (*Delivery of Financial Statements*), neitherthe Company nor its Subsidiaries have restructured or Refinanced anyIndebtedness, or unwound any other Hedging Agreements to which they are aparty, in each case other than the Indebtedness identified in Section 4.01(l) (*Restructured or Refinanced Indebtedness*)or the Terminated Derivative Obligation.

 

5.21.        Hedging Policy.  The HedgingPolicy hasbeen approved by the Board of Directors of the Company (or by a committee dulydelegated by such Board of Directors that is comprised of two or more membersthereof) and is currently in effect.

 

5.22.        Collateral and Guaranties Relating to CompanyIndebtedness.

 

(a)           No Indebtedness of the Company other than the SecuredIndebtedness is secured by a Lien on any Property of the Company or its Subsidiaries.

 

(b)           No Indebtedness of the Company is guaranteed by theCompany’s Subsidiaries.

 

ARTICLE VIAFFIRMATIVE COVENANTS

 

The Company covenants and agrees that for so long asthe Loan or any other Obligation (other than unasserted contingent indemnificationobligations as to which no claim is known) remains unpaid:

 

6.01.        Financial Statements and Other Information.

 

(a)           The Company will deliver to the Lender:

 

(i)                    as soon as available and in any casewithin one hundred twenty (120) days after the end of each Fiscal Year, (x) consolidatedfinancial statements of the Company and its Consolidated Subsidiaries for suchFiscal Year, (y) consolidated financial statements for each MaterialOperating Subsidiary for such Fiscal Year and (z) unconsolidated financialstatements for the Company for such Fiscal Year (each such entity a “ReportingEntity”), in each case audited by independent accountants of recognizedinternational standing (without a “going concern” or like qualification orexception and without any qualification or exception as to the scope of suchaudit, provided that the financial statements of the Company and itsConsolidated Subsidiaries may contain an exception that the independentaccountants did not audit the financial statements of Grupo Financiero BanorteS.A.B. de C.V.), including an annual audited consolidated balance sheet and therelated consolidated statements of income, changes in 

 

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equity and changes in financial position prepared in accordance withMexican GAAP (or US GAAP in the case of Gruma Corp.) consistently applied(except as otherwise discussed in the notes to such financial statements),which financial statements shall present fairly, in accordance with MexicanGAAP (or US GAAP in the case of Gruma Corp.), the financial condition of therelevant Reporting Entity as at the end of the relevant Fiscal Year and theresults of the operations of such Reporting Entity for such Fiscal Year; and

 

(ii)                   as soon as available and in any eventwithin one hundred twenty (120) days after the end of each Fiscal Year, anEnglish translation of the audited consolidated financial statements of theCompany and its Consolidated Subsidiaries for such Fiscal Year.

 

(b)           The Company will deliver to the Lender:

 

(i)                    as soon as available and in any casewithin forty-five (45) days after the end of each of the first three (3) FiscalQuarters, (x) consolidated financial statements of the Company and itsConsolidated Subsidiaries for such Fiscal Quarter (y) consolidatedfinancial statements for each Material Operating Subsidiary for such FiscalQuarter and (z) unconsolidated financial statements for the Company forsuch Fiscal Quarter, in each case including therein an unaudited consolidatedbalance sheet and the related consolidated statements of income prepared inaccordance with Mexican GAAP (or US GAAP in the case of Gruma Corp.),consistently applied (except as otherwise discussed in the notes to suchstatements), which financial statements shall present fairly, in accordancewith Mexican GAAP (or US GAAP in the case of Gruma Corp.), the financialcondition of the relevant Reporting Entity as at the end of the relevant FiscalQuarter and the results of the operations of the Reporting Entity for suchFiscal Quarter and for the portion of the Fiscal Year then ended except for theabsence of complete footnotes and except for normal, recurring year-endaccruals and subject to normal year-end adjustments; and

 

(ii)                   as soon as available and in any eventwithin forty-five (45) days after the end of each of the first three (3) FiscalQuarters an English translation of the consolidated financial statements of theCompany and its Consolidated Subsidiaries for such Fiscal Quarter.

 

(c)           The Company will deliver to the Lender:

 

(i)                    concurrently with the delivery of thefinancial statements pursuant to clauses (a)(i) and (b)(i) above, aQuarterly Compliance Certificate, substantially in the form of Exhibit B-1,signed by the chief financial officer and one additional Senior Officer of theCompany, which shall set forth in reasonable detail and in form and substancesatisfactory to the Lender, the calculations required to determine the LeverageRatio and the Interest Coverage Ratio as of the date of the financialstatements delivered concurrently with such Quarterly Compliance Certificate;

 

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(ii)                   concurrently with the delivery of thefinancial statements for a Fiscal Year pursuant to clause (a)(i) above, anAnnual Compliance Certificate, substantially in the form of Exhibit B-2, signed by the chief financial officer and oneadditional Senior Officer of the Company:

 

(A)                  setting forth in reasonable detail and ina form reasonably satisfactory to the Lender, the calculations required todetermine the amount of Excess Cash for such Fiscal Year;

 

(B)                   setting forth in reasonable detail the amount of Available Excess CashAmount used to finance Capital Expenditures pursuant to Section 7.14(c) (*Limitations on Capital Expenditures*) and otherRestricted Investments pursuant to Section 7.02(b) (*Investments*);

 

(C)                   listing all of the Asset Sales in whichthe Company or its Subsidiaries have engaged during the prior twenty-one(21)-month period ending on the last day of such Fiscal Year, including theamounts of Net Cash Proceeds thereof, any amount of Net Cash Proceeds thereofthat was prepaid to the Other Prepayment Indebtedness and any amount of NetCash Proceeds thereof that was invested in long term productive assets used inthe Company’s Core Business as well as reasonable detail with respect to suchInvestment;

 

(D)                  listing all of the Casualty Events withrespect to the Company or its Subsidiaries during the prior eighteen (18)-monthperiod ending on the last day of such Fiscal Year, including the amounts of NetCash Proceeds thereof, any amount of Net Cash Proceeds thereof that was prepaidto the Other Prepayment Indebtedness and any amount of Net Cash Proceedsthereof that was used to Restore such affected Properties; and

 

(E)                   listing all of the Subsidiaries of theCompany and the Company’s and each Subsidiaries’ respective ownershippercentages therein;

 

(iii)                  concurrently with the delivery of the financial statements for a FiscalYear pursuant to clause (a)(i) above, a certificate signed by theindependent accountants that have audited the financial statements described inclause (a)(i) above, stating whether during the course of theirexamination of such financial statements they obtained knowledge of any Defaultunder Section 7.09 (*Interest CoverageRatio*) or Section 7.10 (*LeverageRatio*) (which certificate may be limited to the extent required byaccounting rules or guidelines); and

 

(iv)                  concurrently with the delivery of thefinancial statements for a Fiscal Year pursuant to clause (a)(i) above, awritten notice signed by the chief financial officer and one additional SeniorOfficer of the Company (a “CapEx Report”) indicating:

 

(A)                  the amount of Capital Expenditures made during such Fiscal Year;

 

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(B)                   the portion of the Permitted CapitalExpenditures Amount to be carried forward from such Fiscal Year to the presentFiscal Year, if any; and

 

(C)                   the amount of Available Excess CashAmount used to finance Capital Expenditures in such Fiscal Year; pursuant to Section 7.14(c) (*Limitations on Capital Expenditures*).

 

(d)           To the extent not otherwise providedunder clause (a) or (b) above, the Company will furnish to theLender, promptly after they are publicly available, copies of all financialstatements and financial reports filed by the Company or any of itsSubsidiaries with (i) any Governmental Authority (if such statement orreports are required to be filed for the purpose of being publicly available)or (ii) with any Mexican or other securities exchange (including the BolsaMexicana de Valores, S.A.B. de C.V., the New York Stock Exchange and theLuxembourg Stock Exchange) and which are publicly available.

 

(e)           The Company will furnish to the Lender, within twenty (20) Business Daysafter the end of each month (or otherwise promptly if requested in writing bythe Lender), the Agreement Value of its Hedging Agreements as of the last dayof such month, together with reasonable supporting documentation of theAgreement Value of its Hedging Agreements for the end of such month and foreach date during such period on which there was a material change in theAgreement Value in respect thereof, including such documentation provided tothe Company by the counterparties to such Hedging Agreements after reasonablerequest.

 

(f)            The Company will deliver to the Lender, promptly afterthe furnishing thereof, copies of any statement, report, proposed amendment orrequest for waiver, or any other similar notice furnished to any holder ofReporting Indebtedness and not otherwise required to be furnished to the Lenderpursuant to this Section 6.01 or Section 6.02 (*Notice of Other Events*).

 

(g)           The Company will furnish to the Lender, promptly uponrequest of the Lender, such additional information regarding the business,financial or corporate affairs of the Company and its Subsidiaries as theLender may reasonably request including for know-your-customer and anti-moneylaundering rules and regulations, including the Patriot Act.

 

(h)           The Company will furnish to the Lender upon request acomplete copy of the annual report (Form 5500) of each Plan of the Companyor any ERISA Affiliate required to be filed with the Internal Revenue Service.

 

(i)            The Company will furnish to the Lenderthe definitive documentation for any Permitted Refinancing Indebtednessincurred to Refinance any Reporting Indebtedness within five (5) BusinessDays of the execution thereof.

 

(j)            The Company will furnish to the Lender as soon as available and in anycase within five (5) Business Days after the end of the preceding month, alisting of the Intercompany Indebtedness, specifying the parties thereto andoutstanding principal amounts thereof, current as of the last day of theimmediately preceding month.

 

(k)           TheCompany will furnish to the Lender as soon as available and in any case withinfive (5) Business Days after the end of the preceding month, the listingof the Reporto 

 

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Contracts,specifying the parties thereto and outstanding principal amounts thereof,current as of the last day of the immediately preceding month.

 

6.02.        Notice of Other Events.  The Companywill furnish to the Lender, no later than three (3) Business Days afterthe Company obtains knowledge thereof:

 

(a)           notice of any Default or Event of Default, signed by aSenior Officer of the Company, describing such Default or Event of Default andthe steps that the Company proposes to take in connection therewith;

 

(b)           notice of any litigation, claim, action or Proceedingpending or threatened in writing before any Governmental Authority (i) againstthe Company or any of its Subsidiaries, in which there is a probability ofsuccess by the plaintiff on the merits and which, if determined adversely tothe Company or such Subsidiary could be reasonably expected to have a MaterialAdverse Effect, (ii) which could reasonably be expected to result inliability of the Company and its Subsidiaries in an aggregate amount exceedingUS$20,000,000 (or the US Dollar Equivalent thereof)or (iii) relating tothis Agreement or any of the other Loan Documents or the Intercompany Revolving Facilitiesor the transactions contemplated hereby or thereby;

 

(c)           notice of the modification of any consent, license,approval or authorization referred to in Section 4.01(c) (*Authorizations*);

 

(d)           notice of the occurrence of any ERISA Event that,alone or together with any other ERISA Events that have occurred, couldreasonably be expected to result in liability of the Company and itsSubsidiaries in an aggregate amount exceeding US$5,000,000 (or the US DollarEquivalent thereof);

 

(e)           notice that an application has been made to theSecretary of the Treasury for a waiver or modification of the minimum fundingstandard (including any required installment payments) or an extension of anyamortization period under Section 412 of the Code with respect to aPension Plan;

 

(f)            notice that a material contribution required to bemade to a Pension Plan by the Company or any ERISA Affiliate has not beentimely made;

 

(g)           notice that a Pension Plan has failed to meet minimumfunding standards to a level sufficient to give rise to a lien under ERISA orthe Code;

 

(h)           notice that a proceeding has been instituted pursuantto Section 515 of ERISA to collect a material delinquent contribution to aMultiemployer Plan;

 

(i)            notice that the Company or any ERISA Affiliate isrequired to file with the PBGC the information required under Section 4010with respect to any Pension Plan; and

 

(j)            notice of any other event or development of which theCompany obtains knowledge that has had or could reasonably be expected to havea Material Adverse Effect.

 

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6.03.        Maintenance of Existence; Conduct of Business.

 

(a)           The Company will, and will cause each of itsSubsidiaries to: (i) maintain in effect its corporate existence and allregistrations necessary therefor; (ii) take all necessary actions tomaintain all rights, privileges, titles to property, franchises and the like,necessary or desirable in the normal conduct of its business (as now conductedand as proposed to be conducted), activities or operations; and (iii) maintainand preserve all of its Property and keep such Property in good working orderor condition; provided, however, that this covenant shall notprohibit any transaction by the Company or any of its Subsidiaries otherwisepermitted under Section 7.03 (*Mergers,Consolidations, Sales and Leases*), nor shall it require anySubsidiary (other than a Material Subsidiary) to maintain any such right,privilege, title to property or franchise or the Company to preserve thecorporate existence of any Subsidiary (other than a Material Subsidiary) if theCompany shall determine in good faith that the maintenance or preservationthereof is no longer desirable in the conduct of the business of the Company orits Subsidiaries and that the loss thereof could not reasonably be expected tohave a Material Adverse Effect.

 

(b)           The Company will, and will cause each of its MaterialSubsidiaries to, continue to engage only in the Company’s Core Business.

 

6.04.        Insurance.  The Companywill, and will cause each of its Subsidiaries to, maintain, and pay allpremiums with respect to, insurance with financially sound, responsible andreputable insurance companies in such amounts and covering such risks as areusually carried by companies of good repute engaged in similar businesses andowning and/or operating properties similar to those owned and/or operated bythe Company or such Subsidiary, as the case may be, in the same general areasin which the Company or such Subsidiary owns and/or operates its properties, inaccordance with normal industry practice; provided that the Company andits Subsidiaries shall not be required to maintain such insurance for damaged, obsolete or worn-out equipment orother Property that is no longer used in or useful to the business or ifthe failure to maintain such insurance could not reasonably be expected to havea Material Adverse Effect.

 

6.05.        Maintenance of Governmental Approvals. The Company will, and will cause each of its Material Subsidiaries to,maintain in full force and effect all governmental approvals (including anyexchange control approvals), consents, licenses and authorizations which may benecessary or appropriate under any Requirement of Law for the conduct of itsbusiness (except where the failure to maintain any such approval, consent,license or authorization could not reasonably be expected to have a MaterialAdverse Effect) or for the performance of any of the Loan Documents or the IntercompanyRevolving Facilities and for the validity or enforceability hereof.  The Company will, and, if applicable, willcause each of its Subsidiaries to, file all applications necessary for, andshall use its reasonable best efforts to obtain, any additional authorizationas soon as possible after determination that such authorization or approval isrequired for the Company or Subsidiary, as applicable, to perform itsobligations under this Agreement or any of the other Loan Documents or the IntercompanyRevolving Facilities.

 

6.06.        Use of Proceeds.  The Companywill use the proceeds of the Loan to repay the Terminated Derivative Obligationon the Closing Date.

 

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6.07.        Payment of Obligations.  The Companywill, and will cause each of its Subsidiaries to, pay all taxes, assessmentsand other governmental charges imposed upon it or any of its Property inrespect of any of its franchises, businesses, income or profits before anypenalty or interest accrues thereon, and pay promptly all Indebtedness andother obligations or claims (including claims for labor, services, materialsand supplies) for sums that have become due and payable in accordance withtheir terms and that by law have or might become a Lien upon its Property,except (a) if the failure to make such payment has not had and would notreasonably be expected to have a Material Adverse Effect or (b) if suchcharge or claim is being contested in good faith by appropriate provisionpromptly initiated and diligently conducted and if such reserves or otherappropriate provision, if any, as shall be required by Mexican GAAP (or, in thecase of Persons organized under laws of any other jurisdiction, the applicableGAAP therein) shall have been made therefor.

 

6.08.        Ranking; Priority.  The Companywill, and will cause each of its Subsidiaries to, promptly take all actions asmay be necessary to ensure that its obligations under the Loan Documents willat all times constitute direct, unconditional and general obligations thereofranking at least *pari passu* inall respects with all other future and present unsecured and unsubordinatedIndebtedness of the Company, except such Indebtedness ranking senior byoperation of law (and not by contract or agreement).

 

6.09.        Compliance with Laws.

 

(a)           The Company will, and will cause each of itsSubsidiaries to, comply in all respects with all applicable Requirements ofLaw, including all applicable Environmental Laws and all Requirements of Lawrelating to social security and ERISA, including INFONAVIT, IMSS and SAR,except (i) where the necessity of compliance therewith is contested ingood faith by appropriate proceedings promptly initiated and diligentlyconducted and if such reserves or other appropriate provision, if any, as shallbe required by Mexican GAAP (or, in the case of Persons organized under laws ofany other jurisdiction, the applicable GAAP therein) shall have been madetherefor or (ii) where any non-compliance could not reasonably be expectedto have a Material Adverse Effect.

 

(b)           Notwithstanding the foregoing, the Company will, and will cause each ofits Subsidiaries to, comply in all respects with Requirements of Law relatingto or arising from maintaining the registration of securities with the MexicanRegistro Nacional de Valores (or any substitute registry) and listing ofsecurities in the Bolsa Mexicana de Valores, S.A.B. de C.V. (or any substitutesecurities exchange), including filing all statements and reports (financial orotherwise) required from time to time under applicable laws and regulations inMexico; provided, however, that if at any time securities issued by theCompany cease to be so registered or listed for any reason, then the Companyshall furnish to the Lender (on a non-confidential basis) all such statementsand reports (financial or otherwise) that the Company would have been requiredto file or disclose from time to time under applicable laws and regulations inMexico, had such securities continued to be so registered or listed.

 

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6.10.        Maintenance of Books and Records.

 

(a)           The Company will, and will cause each of its MexicanSubsidiaries to, maintain books, accounts and other records in accordance withMexican GAAP, and the Company will cause its Subsidiaries organized under lawsof any other jurisdiction to maintain their books and records in accordanceeither with the GAAP of the applicable jurisdiction or Mexican GAAP.

 

(b)           The Company will, and will cause each of its MaterialSubsidiaries to, permit representatives of the Lender or its designee to visitand inspect any of their respective properties and to examine their respectivecorporate, financial and operating books and records, all at such reasonabletimes during normal business hours and as often as may be reasonably desiredupon reasonable advance notice to the Company or such Subsidiary, and one (1) suchvisit per year shall be at the expense of the Company; provided, however,that when a Default or Event of Default exists the Lender or its designee maydo any of the foregoing at any time during normal business hours and withoutadvance notice; and providedfurther that when an Event ofDefault exists, all of the foregoing shall be at the expense of the Company.

 

6.11.        Intercompany Indebtedness.

 

(a)           The Company will and will cause its Subsidiaries tocause all Intercompany Indebtedness (other than Intercompany Indebtedness owedto any Subsidiary in the Gimsa Division by the Company and Guaranty Obligationsby the Company that are permitted by Section 7.16(e) or 7.16(h) (*Limitations on Incurrence of Additional Indebtedness*))to be subordinated to the Loan pursuant to the Intercompany SubordinationAgreement and the Intercompany Trust Agreement and to be evidenced by and issued pursuant to theIntercompany Revolving Facilities.  Priorto the issuance of any Intercompany Indebtedness by any Subsidiary that is notan Intercompany Lender, such Subsidiary shall (i) provide to the Lendercertified copies of the Organizational Documents of such Subsidiary as are infull force and effect, and such applicable corporate documentation evidencingthe authority of such Subsidiary (and the signatories of such Subsidiary, asapplicable) to enter into and perform (x) the Intercompany RevolvingFacility and (y) in the case of any Subsidiary other than Subsidiaries inthe Gimsa Division, the Intercompany Trust Agreement and the IntercompanySubordination Agreement and (ii) become a party to (x) anIntercompany Revolving Facility and (y) in the case of any Subsidiaryother than Subsidiaries in the Gimsa Division, the Intercompany Trust Agreementand the Intercompany Subordination Agreement. The Company will treat the Obligations as senior in payment to anyobligations owed to any Subsidiary that is part of the Gimsa Division by theCompany in accordance with Section 7.19(c) (*Intercompany Indebtedness*) and will nottake any action that would result in the Obligations not being treated assenior in payment to any obligations owed to any Subsidiary that is part of theGimsa Division by the Company in accordance with Section 7.19(c) (*IntercompanyIndebtedness*).

 

(b)           During the pendency of any proceeding filed by oragainst the Company seeking relief as debtor, or seeking to adjudicate theCompany as bankrupt or insolvent, or seeking reorganization, arrangement,adjustment or composition of the Company or its debts under any law relating tobankruptcy, insolvency, reorganization, *concursomercantil*,*quiebra*, orrelief of debtors, or seeking appointment of a receiver, trustee, assignee,custodian, liquidator or *visitador*,*conciliador* or *sindico* or any other similar official forthe Company or for any substantial part of its property, the Company will causeeach Subsidiary to vote any claims that such Subsidiary 

 

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might have based on Intercompany Indebtedness in thesame manner as the majority of the third party creditors of the Company.

 

6.12.        Further Assurances.  The Company will,and will cause each of its Subsidiaries to, at the Company’s own cost andexpense, execute and deliver to the Lender all such other documents,instruments and agreements and do all such other acts and things as may bereasonably required in the opinion of the Lender or its counsel, to enable theLender to exercise and enforce its rights under, and to enable the Lender andthe Company to carry out the intent of this Agreement or the other LoanDocuments including in each case (i) making payments of fees and othercharges and (ii) publishing or otherwise delivering notice to thirdparties.

 

ARTICLE VIINEGATIVE COVENANTS

 

The Company covenants and agrees that for so long asthe Loan or any other Obligation (other than unasserted contingentindemnification obligations as to which no claim is known) remains unpaid:

 

7.01.        Negative Pledge.  The Companywill not, and will not cause or permit any of its Subsidiaries (other than anySubsidiary that is part of the Venezuelan Division) to, directly or indirectly,create, incur, assume or suffer to exist any Lien upon or with respect to anyof its present or future Property, except the following Liens (each a “PermittedLien”):

 

(a)           any Lien existing to secure the Secured Indebtedness(including any Lien created by an amendment thereto in connection with theincurrence of Permitted Refinancing Indebtedness in respect of the MandatoryPrepayment Indebtedness);

 

(b)           the Liens in favor of the Initial Lender, the OtherMinor Derivative Counterparties or the Major Derivative Counterparties on suchPerson’s Temporary Accounts; provided, however, that such Liensshall be terminated immediately upon payment of the Initial Lender’s TerminatedDerivative Obligation in accordance with Section 2.03(c) (*Procedure for Making Loan*) or such OtherMinor Derivative Counterparty’s or Major Derivative Counterparty’s (or itsAffiliate’s) “Terminated Derivative Obligation” (as such term is used in theOther Minor Derivative Counterparty Loans and the Major Derivative CounterpartyLoan) in accordance with the Other Minor Derivative Counterparty Loans and theMajor Derivate Counterparty Loan;

 

(c)           any Lien on any Property (or, in the case of a line ofcredit secured by inventory or accounts receivable, class of Property) existingon the date hereof and set forth in Schedule 7.01 (*Existing Liens*); provided that such Liens shallsecure only those obligations which they secure on the date hereof;

 

(d)           any Lien on any asset securing all or any part of thepurchase price of property or assets (excluding inventories) acquired or anyportion of the cost of construction, development, alteration or improvement ofany property, facility or asset or Indebtedness incurred or assumed solely forthe purpose of financing all or any part of the cost of acquiring orconstructing, developing, altering or improving such property, facility orasset; provided that (i) such Indebtedness is otherwise permittedby Section 7.16 (*Limitations onIncurrence of Additional Indebtedness*), (ii) such Indebtednessdoes not exceed the lesser of the cost and the fair market

 

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value of such property, facility or asset, and (iii) suchLien attaches solely to such property, facility or asset during the period thatsuch property, facility or asset is being constructed, developed, altered orimproved or concurrently with or within one hundred twenty (120) days after theacquisition, construction, development, alteration or improvement thereof;

 

(e)           Liens of a Subsidiary existing prior tothe time such Subsidiary became a Subsidiary of the Company which (i) donot secure Indebtedness exceeding the aggregate principal amount ofIndebtedness subject to such Lien prior to the time such Subsidiary became aSubsidiary of the Company, (ii) do not attach to any Property other thanthe Property attached pursuant to such Lien prior to the time such Subsidiarybecame a Subsidiary of the Company, and (iii) were not created incontemplation of such Subsidiary becoming a Subsidiary of the Company;

 

(f)            any Lien on any Property existing thereonat the time of the acquisition of such Property and not created in connectionwith or in contemplation of such acquisition;

 

(g)           any Lien on any Property (or, in the caseof a line of credit secured by inventory or accounts receivable, class ofProperty) securing an extension, renewal, refunding or replacement ofIndebtedness or a line of credit secured by a Lien referred to in clauses (c),(d), (e) or (f) above or this clause (g); provided that (A) theprior Lien was otherwise permitted pursuant to this Agreement at the time ofsuch extension, renewal, refunding or replacement; (B) such new Lien islimited to the Property (or, in the case of a line of credit secured byinventory or accounts receivable, class of Property) which was subject to theprior Lien immediately before such extension, renewal, refunding orreplacement; and (C) the principal amount of Indebtedness or the amount ofthe line of credit secured by the prior Lien is not increased immediatelybefore or in contemplation of or in connection with such extension, renewal,refunding or replacement;

 

(h)           any Lien securing taxes, assessments andother governmental charges, the payment of which is not yet due or the paymentof which is being contested in good faith by appropriate proceedings promptlyinitiated and diligently conducted and for which such reserves or otherappropriate provision, if any, as shall be required by Mexican GAAP or, in thecase of Subsidiaries organized under laws of any other jurisdiction, theapplicable GAAP therein, shall have been made;

 

(i)            Liens incurred or deposits made in theOrdinary Course of Business in connection with workers’ compensation,unemployment insurance, other types of social security and any Liens imposed byERISA;

 

(j)            statutory Liens of landlords and Liens ofcarriers, warehousemen, mechanics, materialmen, repairmen or the like arisingin the Ordinary Course of Business for sums not yet due or the payment of whichis being contested in good faith by appropriate proceedings promptly initiatedand diligently conducted and for which such reserves or other appropriateprovision, if any, as shall be required by Mexican GAAP or, in the case ofSubsidiaries organized under laws of any other jurisdiction, the applicableGAAP therein, shall have been made;

 

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(k)           any Lien created by attachment orjudgment (provided that such attachment or judgment does not constitutean Event of Default), unless the judgment it secures shall not, within sixty(60) days after the entry thereof, have been discharged or execution thereofstayed pending appeal;

 

(l)            any Lien on cash, Cash EquivalentInvestments or in the form of a letter of credit, in each case created inconnection with, and posted or granted as required by, a Hedging Agreemententered into in accordance with Section 7.18 (*Limitations on Hedging*) in an amount not in excess of US$35,000,000 (or the US Dollar Equivalentthereof) in the aggregate at any one time; and

 

(m)          Liens created to secure Permitted NewIndebtedness not in excess of US$250,000,000 (or the US Dollar Equivalentthereof) in the aggregate consisting of:

 

(i)                    Liens on real or personal property tosecure Permitted New Capital Obligations consisting of Capital LeaseObligations not in excess of US$50,000,000 (or the US Dollar Equivalentthereof); provided that any Lien on real or personal property to securea Permitted New Capital Obligation consisting of a Capital Lease Obligationshall be on the real or personal property leased pursuant to such Capital LeaseObligation; and

 

(ii)                   Liens on inventories or accountsreceivable created to secure Permitted New Working Capital Indebtedness, when taken together with Liens pursuant toclause (l)(i) of this Section 7.01, not in excess ofUS$250,000,000 (or the US Dollar Equivalent thereof), subject to therestrictions on such Indebtedness in Section 7.16(g) (*Limitations on Incurrence of Additional Indebtedness*).

 

7.02.        Investments. The Company will not, and will not cause or permit any of itsSubsidiaries (other than Subsidiaries that are part of the Venezuelan Division)to make, maintain or suffer to exist any Investment, except the following:

 

(a)           the Company and its Subsidiaries may make(or, in the case of clause (i) below, maintain) at any time:

 

(i)                    Any Investment existing on the datehereof (A) as set forth on Schedule 7.02 (*ExistingInvestments*) if in excess of US$1,000,000 (or the US DollarEquivalent thereof) and (B) if less than such amount, included in thefinancial statements of the Company and/or its Subsidiaries prior to the datehereof;

 

(ii)                   Cash Equivalent Investments;

 

(iii)                  Capital Expenditures not to exceed (A) thePermitted Capital Expenditures Amount and (B) any portion of the PermittedCapital Expenditures Amount carried over in accordance with Section 7.14(b) (*Limitations on Capital Expenditures*);

 

(iv)                  Investments consisting of extensions ofcredit of less than sixty (60) days in the nature of accounts receivable ornotes receivable arising from the sale or lease of goods or services in theOrdinary Course of Business;

 

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(v)                   Subject to Section 7.12(b) (*Fundamental Changes, Limitations on Asset Sales,Asset Exchanges and Acquisitions*), and as long as no Default orEvent of Default has occurred and is continuing, or will occur as a result ofsuch Investment,Investments in the Core Business (otherthan Investments in the Venezuelan Division) made from any Net CashProceeds of a Permitted Company Equity Issuance that is consummated inaccordance with Section 7.22(b) (*EquityIssuances*) that are not required to be applied to the mandatoryprepayment of Mandatory Prepayment Indebtedness;

 

(vi)                  Subject to Section 7.12(b) (*Fundamental Changes, Limitations on Asset Sales,Asset Exchanges and Acquisitions*), Investments in the long-term productive assets used in the Core Business (other than Investments in the VenezuelanDivision) made from 50% of the Net Cash Proceeds of an Asset Sale duringthe relevant Reinvestment Period for such Asset Sale; provided that (x) noDefault or Event of Default has occurred and is continuing, or will occur as aresult of such Investment, (y) a Reinvestment Certificate has beendelivered within the applicable Required Payment Period for such Asset Sale and(z) the Company has made any mandatory prepayments required pursuant to Section 2.05(a) (*Mandatory Prepayments*);

 

(vii)                 Investments to Restore Property affected by a CasualtyEvent made from the Net Cash Proceeds of such Casualty Event and made duringthe relevant Reinvestment Period for such Casualty Event; provided that (w) noDefault or Event of Default has occurred and is continuing, or will occur as aresult of such Investment, (x) the Company has (i) filed an insuranceclaim in respect of such Casualty Event within five (5) Business Daysthereof and (ii) delivered a Casualty Certificate within ten (10) BusinessDays following the filing of such claim, (y) the Company has made anymandatory prepayments required pursuant to Section 2.05(b) (*Mandatory Prepayments*) and (z) theaggregate value of Investments in respect of any Casualty Event do not exceed (i) US$10,000,000(or the US Dollar Equivalent thereof) unless the written consent of the holdersof more than 50% of the then aggregate outstanding principal amount of theMajor Derivative Counterparty Loan has been obtained or (ii) US$55,000,000(or the US Dollar Equivalent thereof) in any event;

 

(viii)                Hedging Agreements permittedby and entered into in accordance with Section 7.16(f) (*Limitations on Incurrence of Additional Indebtedness*)and Section 7.18 (*Limitations onHedging*);

 

(ix)                   Investments in IntercompanyIndebtedness permitted by and made in accordance with Sections 7.16(e), 7.16(h) or7.16(j) (*Limitations on Incurrence ofAdditional Indebtedness*); and

 

(x)                    Investments in Subsidiaries, other thanSubsidiaries in the Venezuelan Division, consisting of (x) IntercompanyIndebtedness Capitalization made prior to January 1, 2010 in an aggregateamount not to exceed an amount equal to the sum of (A) the amount ofExisting Intercompany Indebtedness set forth on Schedule 5.20(b) (*Existing Intercompany Indebtedness* and (B)US$30,000,000 (or the US Dollar Equivalent thereof) and (y) IntercompanyIndebtedness Capitalization in an aggregate 

 

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amount not toexceed US$30,000,000 (or the US Dollar Equivalent thereof) per annumthereafter; and

 

(b)           as long as noDefault or Event of Default has occurred and is continuing, or will occur as aresult of such Investment, in any Fiscal Year, if such Fiscal Year follows anExcess Cash Year, the Company and its Subsidiaries may make, solely from theAvailable Excess Cash Amount for such Fiscal Year, Restricted Investments(other than Investments in the Venezuelan Division, which shall be deemedexcluded from this Clause (b)) in an amount not to exceed in the aggregate forthe Company and its Subsidiaries the Permitted New Investment Amount

 

provided, however,that notwithstanding the foregoing clauses any of (a) and (b), the Companyand its Subsidiaries (other than Subsidiaries that are part of the VenezuelanDivision) shall not make any Investments in the Venezuelan Division.

 

7.03.        Mergers, Consolidations, Sales and Leases. The Company will not, and will not permit or cause any of its MaterialSubsidiaries (other than any Subsidiary that is part of the VenezuelanDivision) to (x) dissolve or liquidate, (y) merge, amalgamate orconsolidate with or into, or (z) convey, transfer or lease all orsubstantially all of its Property (other than Property of any Subsidiary thatis part of the Venezuelan Division) (whether now owned or hereinafter acquired)to or in favor of any Person (in each case, whether in one transaction or aseries of transactions), unless (i) the Minor Derivative Counterpartiesholding more than 50% of the then aggregate outstanding principal amount of theMinor Derivative Counterparty Loans consent to any such dissolution,liquidation, merger, amalgamation, consolidation, conveyance, transfer or leaseand (ii) immediately after giving effect to any dissolution, liquidation,merger, amalgamation, consolidation, conveyance, transfer or lease:

 

(a)           no Default or Event of Default hasoccurred and is continuing; and

 

(b)           in the case of a merger, amalgamation,consolidation, or conveyance, transfer or lease of substantially all of theCompany’s Property, any corporation formed by any such merger or consolidationwith the Company or the Person which acquires by conveyance or transfer, orwhich leases, all or substantially all of the Company’s Property shallexpressly assume in writing the due and punctual payment of the principal of,and interest on all Obligations, according to their terms, and the due andpunctual performance of all of the covenants and obligations of the Companyunder this Agreement by an instrument in form and substance reasonablysatisfactory to the Lender and shall provide an opinion of counsel acceptableto the Lender, obtained at the Company’s expense, on which the Lender mayconclusively rely;

 

provided that the consent of the Minor DerivativeCounterparties shall not be required for any merger, consolidation, conveyance,transfer or lease in which a Material Subsidiary (other than a MaterialOperating Subsidiary or its Subsidiaries) merges with any other Subsidiary(other than a Material Operating Subsidiary or its Subsidiaries) where theMaterial Subsidiary is the surviving entity; and

 

provided further that, notwithstanding the foregoing, the Company willnot, and will not permit or cause any of the Material Operating Subsidiaries ortheir respective Subsidiaries to (x) dissolve or liquidate, or (y) merge,amalgamate or consolidate with or into, or (z) convey, 

 

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transfer or lease all or substantially all of itsProperty (whether now owned or hereinafter acquired) to or in favor of anyPerson (in each case, whether in one transaction or a series of transactions).

 

7.04.        RestrictedPayments.  The Company will not, and will not cause orpermit any of its Subsidiaries to, declare or make, directly or indirectly, anyRestricted Payment, or incur any obligation (contingent or otherwise) to do so.Notwithstanding the foregoing limitation,and if and to the extent permitted by this Agreement, the Company or anySubsidiary may declare or make the following Restricted Payments:

 

(a)           each Subsidiary may make RestrictedPayments:

 

(i)                    to the Company (and, in the case of suchRestricted Payment by a non-wholly-owned Subsidiary, to each other owner ofcapital stock of such Subsidiary on a prorata basis based ontheir relative ownership interests);

 

(ii)                   consisting of dividend payments or otherdistributions in respect of such Subsidiary’s capital stock, partnershipinterest or ownership interest to any other Subsidiary of the Company (and, inthe case of such Restricted Payment by a non-wholly-owned Subsidiary, to eachother owner of capital stock of such Subsidiary on a proratabasis based on their relative ownership interests); and

 

(iii)                  other than as permitted by clauses (i) or (ii) aboveas long as no Default or Event of Default has occurred and is continuing, towholly-owned Subsidiaries (other than any Subsidiary that is part of theVenezuelan Division) (and, in the case of such Restricted Payment by anon-wholly-owned Subsidiary, to the Company and any Subsidiary (other than anySubsidiary that is part of the Venezuelan Division) and to each other owner ofcapital stock of such Subsidiary on a prorata basis based ontheir relative ownership interests); provided that such RestrictedPayment would be otherwise permitted by 7.02(b) (*Investments*);

 

(b)           the Company and each Subsidiary maydeclare and make dividend payments or other distributions payable solely in thecommon stock of such Person; and

 

(c)           as long as noDefault or Event of Default has occurred and is continuing, or would occur as aresult of such Restricted Payment, Gimsa may purchase shares of the capital stock ofGimsa to the extent permitted pursuant to Section 7.02 (*Investments*).

 

7.05.        OtherAgreements.  The Companywill not, and will not cause or permit any of its Subsidiaries to enter into,renew, suffer or permit to exist or become effective, any agreement orarrangement with any other Person with respect to the incurrence of anyIndebtedness that contains any covenants (including but not limited to,affirmative, financial or negative covenants) mandatory prepayments or eventsof default that are more restrictive than those set forth herein other than asset forth in the Major Derivative Counterparty Loan and the BBVA Loan.

 

7.06.        BurdensomeAgreements.  The Company will not, and will not cause orpermit any of its Subsidiaries to, create, cause, incur, assume, enter into,renew, extend, suffer or permit

 

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to exist on or becomeeffective, any consensual encumbrance or restriction of any kind or agreement that: (a) expressly prohibits or restricts the payment ofdividends or other distributions to the Company or the making of loans to theCompany or the ability to transfer any of its property or assets to any of theforegoing, other than in connection with the maintenance, renewal or extensionof any agreement listed in Schedule 5.12(b) (*Restrictive Subsidiary Agreements*), provided that (i) therestrictions or prohibitions under such agreement are not increased as a resultof such renewal or extension, and (ii) in connection with any such renewalor extension of an agreement that does not already contain any suchprohibition, the Company will not, and will not permit its Subsidiaries to,agree to or accept the inclusion of such prohibition; (b) subordinates any Indebtedness (other thanIntercompany Indebtedness) owed to the Company or its Subsidiaries, or (c) inany way restricts or otherwise prevents the Company from performing itsobligations under any Loan Document, provided that any payment orDisposition of Property otherwise permitted by this Agreement shall not bedeemed to restrict or otherwise prevent the Company from performing itsobligations under any Loan Document.

 

7.07.        Transactionswith Affiliates; Arm’s Length Transactions.  The Companywill not, and will not cause or permit any of its Subsidiaries to, enter into,renew or extend or be a party to any transaction or series of relatedtransactions with (a) any Affiliate of the Company, (b) any JointVenture Partner, or (c) any director or officer of the Company, except ineach case if such transaction is entered into upon fair and reasonable terms noless favorable to the Company or such Subsidiary than are obtainable in acomparable arm’s length transaction with an independent unrelated third partythat is not one of the persons listed in (a), (b) or (c) above.  The Company will not, and will not cause orpermit any of its Subsidiaries to, enter into any transaction other than on anarm’s length basis.

 

7.08.        NoSubsidiary Guarantees of Certain Indebtedness.  The Companywill not cause or permit any of its Subsidiaries, directly or indirectly, toguarantee or otherwise become liable or responsible for, in any manner, anyIndebtedness of the Company.

 

7.09.        Interest Coverage Ratio. The Company will not permit its Interest Coverage Ratio as of the lastday of any Fiscal Quarter ending after the date of this Agreement to be lessthan the following ratios in the followingyears:

 

| **Fiscal Year ending December 31,** | ** ** | **Interest Coverage Ratio** |
|------------------------------------------|------------|-----------------------------|
| 2009                                     |       | 2.50 to 1.00                |
| 2010                                     |       | 2.50 to 1.00                |
| 2011                                     |       | 2.75 to 1.00                |
| 2012                                     |       | 2.75 to 1.00                |

 

7.10.        Leverage Ratio.  The Companywill not permit its Leverage Ratio on any date after the date of this Agreementto be greater than the following ratiosin the following years:

 

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| **Fiscal Year ending December 31,** | ** ** | **Leverage Ratio** |
|------------------------------------------|------------|--------------------|
| 2009                                     |       | 5.95 to 1.00       |
| 2010                                     |       | 5.60 to 1.00       |
| 2011                                     |       | 5.00 to 1.00       |
| 2012                                     |       | 4.50 to 1.00       |

 

7.11.        Limitationson Changes to Constituent Documents, Indebtedness, Corporate Existence,Business.  The Company will not, and will not cause orpermit any of its Subsidiaries to:

 

(a)           amend, modify or otherwise change any ofits Organizational Documents in any way that would adversely affect the Lender;provided  that any amendment,modification or change that would adversely affect the value of the Intercompany Indebtedness or theability of any Lender to exercise itsrights under the Intercompany Trust Agreement shall be deemed toadversely affect the Lender;

 

(b)           amend, modify or otherwise change theterms of any Reporting Indebtedness (including through an amendment ormodification to the Reporting Indebtedness Documentation or the entry into anyContractual Obligation in respect of the Reporting Indebtedness) in any waythat would (i) require additional mandatory prepayments of such ReportingIndebtedness, (ii) require the Company or its Subsidiaries to incur anyLiens, (iii) reduce the weighted average maturity of such ReportingIndebtedness, (iv) increase the interest rate or any other amount payable inrespect of such Reporting Indebtedness, (v) require the payment of anyfees to the holders of such Reporting Indebtedness (other than nominalamendment and waiver fees in amounts consistent with market practice at thetime such fees are paid), or (vi)  in any way that would otherwiseadversely affect (x) the economic rights of the Lender or (y) the economicobligations of the Company in a more onerous manner than the terms of suchReporting Indebtedness;

 

(c)           take any action or conduct its affairs ina manner that could reasonably be expected to result in its corporate existencebeing ignored by any court of competent jurisdiction or in its assets and/orliabilities being substantively consolidated with those of any other Person ina bankruptcy, reorganization or other insolvency proceeding; or

 

(d)           with respect to the Company, change itsaccounting policies or tax reporting practices (other than as permitted byMexican GAAP) or change the end of its Fiscal Year to a date other than December 31(regardless of whether such change is permitted by Mexican GAAP).

 

7.12.        FundamentalChanges, Limitations on Asset Sales, Asset Exchanges and Acquisitions.

 

(a)           The Company will not, and will not causeor permit any of its Subsidiaries to conduct any Asset Sales (other than AssetSales by any Subsidiary that is part of the Venezuelan Division) except AssetSales in respect of which (i) theconsideration for such Asset Sale is at

 

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least 80% cash and (ii) a mandatory prepayment is made inaccordance with Section 2.05(a) (*MandatoryPrepayments*), if applicable;

 

(b)           The Company andits Subsidiaries may acquire all or substantially all of the assets or capitalstock of any Person (the “Target”) (in each case, a “PermittedAcquisition”) subject to any other limitations under this Agreement and thesatisfaction of each of the following conditions:

 

(i)                    the Lendershall receive at least fifteen (15) days’ prior written notice of such proposedPermitted Acquisition, which notice shall include a reasonably detaileddescription of such proposed Permitted Acquisition;

 

(ii)                   such PermittedAcquisition shall only involve assets comprising a business, or those assets ofa business, engaged in the Core Business, and which would not subject theLender to regulatory or third party approvals in connection with the exerciseof its rights and remedies under this Agreement or any other Loan Documentsother than approvals applicable to the exercise of such rights and remedieswith respect to Company prior to such Permitted Acquisition;

 

(iii)                  no additionalIndebtedness or other liabilities other than Indebtedness permitted pursuant toSection 7.16 (*Limitations on Incurrenceof Additional Indebtedness*) shall be incurred, assumed or otherwisebe reflected on a consolidated balance sheet of Company and Target after givingeffect to such Permitted Acquisition, except ordinary course trade payables andaccrued expenses;

 

(iv)                  the sum of allamounts payable in connection with all Permitted Acquisitions (including,without duplication, all transaction costs and all Indebtedness and liabilities(other than customary indemnities provided by purchasers) incurred or assumedin connection therewith or otherwise reflected on a consolidated balance sheetof Company and Target) shall be permitted pursuant to Section 7.02 (*Investments*);

 

(v)                   at the time ofsuch Permitted Acquisition and after giving effect thereto, no Default or Eventof Default has occurred and is continuing;

 

(vi)                  the business and assetsacquired in such Permitted Acquisition shall be free and clear of all Liens(other than Liens permitted pursuant to Section 7.01 (*Negative Pledge*)); and

 

(vii)                 with respect toany Permitted Acquisition where the aggregate consideration (including anyassumption of Indebtedness) in connection therewith is equal to or greater thanUS$40,000,000 (or the US Dollar Equivalent thereof):

 

(A)                  Target shall have had aconsolidated EBITDA of greater than negative US$5,000,000 (or the US DollarEquivalent thereof), pro forma for adjustments reasonably satisfactory to theLender for the trailing twelve-month period preceding the date of the PermittedAcquisition, as determined based upon the Target’s financial statements for itsmost recently completed fiscal year and its 

 

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most recent interim financial period completed within sixty (60) daysprior to the date of consummation of such Permitted Acquisition; and

 

(B)                   Concurrently with deliveryof the notice referred to in clause (i) above, the Company shall havedelivered to the Lender:

 

1.               a pro forma consolidatedbalance sheet, income statement and cash flow statement of the Company and itsSubsidiaries (the “Acquisition Pro Forma”), based on recent financialstatements, which shall be complete and shall fairly present in all materialrespects the assets, liabilities, financial condition and results of operationsof the Company and its Subsidiaries in accordance with GAAP consistentlyapplied, but taking into account such Permitted Acquisition; and

 

2.               a certificateof the chief financial officer of the Company to the effect that:  (i) the Company will be Solvent upon theconsummation of the Permitted Acquisition; (ii) the Acquisition Pro Formafairly presents the financial condition of the Company and its Subsidiaries (ona consolidated basis) as of the date thereof after giving effect to thePermitted Acquisition; and (iii) the Company and its Subsidiaries havecompleted their due diligence investigation with respect to the Target and suchPermitted Acquisition, which investigation has produced results satisfactory tothe Company and its Subsidiaries.

 

7.13.        Limitationson Sale Lease-Back Transactions.  The Companywill not, and will not cause or permit any of its Subsidiaries (other thanSubsidiaries that are part of the Venezuelan Division) to, directly orindirectly, enter into any Sale Lease-Back Transactions other than PermittedNew Capital Obligations that are permitted by Section 7.16(g) (*Limitations on Incurrence of Additional Indebtedness*)consisting of Sale Lease-Back Transactions.

 

7.14.        Limitationson Capital Expenditures.

 

(a)           Subject to clauses (b) and (c) below,the Company will not, and will not cause or permit any of its Subsidiaries to,directly or indirectly, make (or be or become legally or contractuallyobligated to make) any Capital Expenditures (other than Capital Expenditures inVenezuela by Subsidiaries that are part of the Venezuelan Division) during anyFiscal Year that would cause theaggregate Capital Expenditures for such year to exceed the PermittedCapital Expenditures Amount for such Fiscal Year (which amount shall includeany Permitted New Capital Obligations consisting of Capital Lease Obligationsincurred in such Fiscal Year).

 

(b)           To the extent that the Company and itsSubsidiaries do not expend the full Permitted Capital Expenditures Amount inany given Fiscal Year the Company and its Subsidiaries will be permitted tocarry forward any Unused CapEx to the immediately following Fiscal Year (butnot to any subsequent Fiscal Year); provided that (i) the Companyhas delivered the CapEx Report in the present Fiscal Year and (ii) no Default or Event of Defaulthas occurred and is continuing or would occur after giving effect to suchtransaction.

 

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(c)           In addition to the foregoing, the Companymay, in its discretion, make additional Capital Expenditures to the extentpermitted by Section 7.02(b) (*Investments*);provided that (i) the Company has delivered the CapEx Report in thepresent Fiscal Year and (ii) no Default or Event of Default has occurredand is continuing or would occur after giving effect to such CapitalExpenditure.

 

7.15.        Limitationson Voluntary Prepayments of Indebtedness.  The Companywill not, and will not cause or permit any of its Subsidiaries to, directly orindirectly make any payment in violation of any subordination terms of anyIndebtedness, other than the payment of Venezuelan Non-Recourse Indebtedness byany Subsidiary that is part of the Venezuelan Division.

 

7.16.        Limitationson Incurrence of Additional Indebtedness.  The Companywill not, and will not cause or permit any of its Subsidiaries to, directly orindirectly, create, incur, assume or suffer to exist any Indebtedness; providedthat the Company and its Subsidiaries shall be permitted to incur, assume, orsuffer to exist, without duplication:

 

(a)           Indebtedness under the Loan Documents;

 

(b)           Existing Indebtedness listed on Schedule5.20(a) (*Existing Indebtedness*);

 

(c)           Permitted Refinancing Indebtedness (providedthat, if applicable, the Company makes any mandatory prepayment required by Section 2.05(d) (*Mandatory Prepayments*));

 

(d)           Venezuelan Non-Recourse Indebtedness;

 

(e)           Venezuelan Recourse Indebtedness inrespect of Indebtedness owed to Persons other than the Company or itsAffiliates in an amount not to exceed US$40,000,000 (or the US DollarEquivalent thereof) outstanding at anyone time to the extent such Venezuelan Recourse Indebtedness is Working CapitalIndebtedness, the proceeds of which are used solely for grain purchases(“Permitted Venezuelan Recourse Indebtedness”);

 

(f)            the Agreement Value of Hedging Agreementsexecuted in accordance with Section 7.18 (*Limitationson Hedging*);

 

(g)           As long as noDefault or Event of Default has occurred and is continuing or would occur aftergiving effect to such Indebtedness under this clause (g), additionalIndebtedness not otherwise permitted by this Section 7.16 in an aggregateamount for the Company and its Subsidiaries at any time outstanding not toexceed an amount equal to (x) US$250,000,000 (or the US Dollar Equivalent thereof) less (y) the aggregate principal amountof all Reporto Contracts outstanding at such time (such Indebtedness, “PermittedNew Indebtedness”), to the extent such Permitted New Indebtedness:

 

(i)                    is either unsecured or secured inaccordance with Section 7.01 (*NegativePledge*); and

 

(ii)                   consists of either: (x) WorkingCapital Indebtedness (excluding Venezuelan Recourse Indebtedness) (such WorkingCapital Indebtedness, “Permitted New Working Capital Indebtedness”) or (y) nomore than US$50,000,000 (or the US

 

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Dollar Equivalentthereof) of Capital Lease Obligations and/or Sale Lease-Back Transactionsrelated to the Company’s Core Business (collectively, “Permitted New CapitalObligations”);

 

(h)           any of the following Guaranty Obligationsin respect of Indebtedness owed to Persons other than the Company or itsAffiliates (provided that solely for the purposes of this Section 7.16(h),Grupo Financiero Banorte S.A.B. de. C.V. and its Subsidiaries shall not beconsidered Affiliates of the Company):

 

(i)                    Guaranty Obligations of a Subsidiary inrespect of obligations of its direct or indirect Subsidiaries that are relatedto the Core Business provided that, notwithstanding the foregoing, any Subsidiary that is not part ofthe Venezuelan Division may not incur Guaranty Obligations in respect ofobligations of any Subsidiary that is part of the Venezuelan Division;

 

(ii)                   the Permitted Bancomext Guaranty;

 

(iii)                  the Guaranty Obligation incurred by theCompany in respect of operating leases of Subsidiaries that are not part of theGruma Corp. Division, the Latin American Divisions or the Venezuelan Division; providedthat such Guaranty Obligation shall not exceed US$25,000,000 (or the US DollarEquivalent thereof);

 

(iv)                  Guaranty Obligations of the Company in respect of Indebtedness not toexceed US$60,000,000 (or the US Dollar Equivalent thereof) outstandingprincipal amount in the aggregate at any time, consisting of:

 

(A)                  Working Capital Indebtedness (other thanVenezuelan Recourse Indebtedness, and including Guaranty Obligations in respectof Existing Working Capital Indebtedness but excluding the Permitted BancomextGuaranty) or ITOperating Leases of Subsidiaries that are part of the Gimsa Division, in eachcase to the extent permitted under this clause (iv), which Working CapitalIndebtedness and IT Operating Leases shall not exceed US$60,000,000 (or the USDollar Equivalent thereof) of outstanding principal amount in the aggregate atany time;

 

(B)                   WorkingCapital Indebtedness of Subsidiaries that are part of the Central AmericaDivision  (including Guaranty Obligationsin respect of Existing Working Capital Indebtedness but excluding the PermittedBancomext Guaranty), to the extent permitted pursuant to this clause (iv),which Working Capital Indebtedness shall not exceed US$35,000,000 (or the USDollar Equivalent thereof) of outstanding principal amount in the aggregate atany time;

 

(C)                   Working Capital Indebtedness ofSubsidiaries that are part of the Molinera Division (including GuarantyObligations in respect of Existing Working Capital Indebtedness but excludingthe Permitted Bancomext Guaranty), to the extent permitted pursuant to this clause (iv), which WorkingCapital Indebtedness shall not exceed US$20,000,000 (or the US DollarEquivalent thereof) of outstanding principal amount in the aggregate at anytime;

 

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(i)            Other Restructured Indebtedness; and

 

(j)            Intercompany Indebtedness (i) evidencedby and issuedpursuant to the Intercompany Revolving Facilities in accordance with Section 6.11(*Intercompany Indebtedness*), (ii) subordinatedto the Loan pursuant to the Intercompany Subordination Agreement and theIntercompany Trust Agreement (other than, in each case, IntercompanyIndebtedness owed by the Company to a Subsidiary in the Gimsa Division) and (iii) whereall rights of such Intercompany Lender of such Intercompany Indebtedness (otherthan Intercompany Indebtedness owed by the Company to a Subsidiary in the GimsaDivision) have been assigned to the Trustee pursuant to the Intercompany TrustAgreement;

 

provided that, in addition to the foregoing restrictions, theCompany and its Subsidiaries will not, and will not cause, or permit any of itsSubsidiaries to, directly or indirectly, create, incur, assume or suffer toexist any Indebtedness otherwise permitted by this Section 7.16 (exceptPermitted Refinancing Indebtedness that is actually applied within five (5) BusinessDays to prepay Indebtedness being Refinanced (plus the amount of any premiumrequired to be paid under the terms of the instrument governing suchIndebtedness being Refinanced) and any other Indebtedness required to beprepaid pursuant to Section 2.05 (*MandatoryPrepayments*) (and any breakage costs in connection therewith)) ifthe creation, incurrence, assumption or existence of such Indebtedness wouldcause the Leverage Ratio to exceed the limits set in Section 7.10 (*Leverage Ratio*) or the Interest Coverage Ratio to be less thanthe minimum set forth in Section 7.09 (*InterestCoverage Ratio*) on a pro forma basis.

 

7.17.        Limitationson ERISA Deficiencies.  The Company shall not, andshall not cause or permit any of its Subsidiaries or any ERISA Affiliate to (i) permitany Pension Plan to incur any “funding deficiency,” whether or not waived,within the meaning of Section 302 of ERISA or Section 412 of the Codeor (ii) permit or cause the Unfunded Pension Liability of all PensionPlans to exceed, in the aggregate, US$10,000,000 (or the US Dollar Equivalentthereof).

 

7.18.        Limitationson Hedging.

 

(a)           The Company will not, and will not causeor permit any Subsidiary to, enter into (or become legally obligated to enterinto) any Hedging Agreement or transaction under any Hedging Agreement that:

 

(i)                    is for speculative purposes or is withthe aim of obtaining profits based on changing market values;

 

(ii)                   is based on or associated with theunderlying value of a product, interest rate or currency other than thoseproducts, interest rates or currencies that are used by the Company or suchSubsidiary in the Ordinary Course of Business;

 

(iii)                  has a notional value that exceeds:

 

(A)                  in the case of a commodity or product,150% of the volume of such commodity or product consumed by the Company or suchSubsidiary during the most recent Measurement Period; or

 

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(B)                   in the case of an interest rate orcurrency, the Company’s or such Subsidiary’s requirements for such interestrate or currency (pursuant to the Company’s or such Subsidiary’s ContractualObligations) for the eighteen (18) months immediately following the date ofsuch Hedging Agreement;

 

(iv)                  has a tenor of more than eighteen (18)months;

 

(v)                   would cause the aggregate notional amountof all Hedging Agreements with any single counterparty to exceed US$100,000,000(or the US Dollar Equivalent thereof);

 

(vi)                  is with a counterparty other than aQualified Counterparty; or

 

(vii)                 is in violation of, or otherwiseviolates, the Hedging Policy as in effect from time to time;

 

provided that the Company will be permitted to enter intonon-speculative Hedging Agreements for the purpose of hedging the full amountof the interest rate risk associated with the Loan or the Other RestructuredIndebtedness if such Hedging Agreements otherwise are in compliance with clauses(i), (ii), (v), (vi) and (vii) above.

 

(b)           The Company will not:

 

(i)                    permit or cause the effectiveness of theHedging Policy to lapse until the Loan has been repaid;

 

(ii)                   permit or cause the Hedging Policy topermit hedging for speculative purposes or with the aim of obtaining profits based onchanging market values;

 

(iii)                  amend or otherwise change the HedgingPolicy unless (x) such amendment or change has been approved by the Boardof Directors of the Company (or of a committee duly delegated by such Board ofDirectors comprised of two (2) or more members thereof) and (y) theLender is provided with written notice and copies of such amendment or changeto the Hedging Policy no later than five (5) Business Days after any suchamendment or change is approved as contemplated above.

 

7.19.        IntercompanyIndebtedness.

 

(a)           The Company will not, and will not cause or permit any Subsidiary to,enter into or maintain any Intercompany Indebtedness other than (i) GuarantyObligations permitted by Sections 7.16(e) and 7.16(h) (*Limitations on Incurrence of Additional Indebtedness*)and (ii) Intercompany Indebtedness entered into pursuant to Section 6.11(*Intercompany Indebtedness*) andthat is either (x) owed to any Subsidiary in the Gimsa Division by the Companyor (y) subordinated to the Loan pursuant to the Intercompany SubordinationAgreement and the Intercompany Trust Agreement, and where all rights of suchIntercompany Lender of such Intercompany Indebtedness (other than IntercompanyIndebtedness owed to any Subsidiary in the Gimsa Division by the Company) havebeen assigned to the Trustee pursuant to the Intercompany Trust Agreement.

 

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(b)           The Company will not, and will not cause or permit any Subsidiary to,amend or waive any part of the Intercompany Revolving Facilities in any waythat would result in (i) a violation of this Agreement or (ii) achange of any kind in the provisions of the Intercompany Revolving Facilitiesrelating to the subordination of the Intercompany Indebtedness.

 

(c)           Upon the occurrence and during thecontinuation of an Event of Default, the Company will not make any payment toany Subsidiary pursuant to the terms of any Intercompany Indebtedness and willnot take any action which could cause or result in such payment being made.

 

7.20.        MaterialSubsidiaries.  The Company will not, at any time, permit orcause the Company and its Material Subsidiaries to:

 

(a)           own less than 85% of the total assets ofthe Company and its Consolidated Subsidiaries as of the end of the Company’smost recently completed Fiscal Year; or

 

(b)           generate less than 85% of earnings beforeincome tax and employee statutory profit sharing of the Company and itsConsolidated Subsidiaries as of the end of the Company’s most recentlycompleted Fiscal Year;

 

provided that at any time, the Company may, by written noticeto the Lender, amend Schedule 1.01(b) (*ExistingMaterial Subsidiaries*) so as to (x) make any Subsidiary aMaterial Subsidiary or (y) remove any Subsidiary from Schedule 1.01(b) (*Existing Material Subsidiaries*)**if such Subsidiary (i) does notqualify as a Material Subsidiary pursuant to clauses (a), (b) or (d) ofthe definition thereof and (ii) is not required for the Company to meetthe conditions specified in clauses (a) and (b) above.

 

7.21.        ReportoContracts.  The aggregate principal amount of all of the Reporto Contracts at anytime when taken together with all Permitted New Indebtedness shall not exceedUS$250,000,000 (or the US Dollar Equivalent thereof).

 

7.22.        EquityIssuances.  The Company will not, and will not cause orpermit any Subsidiary to issue any capital stock of the Company or suchSubsidiary, except:

 

(a)           the Company may pay dividends in capitalstock of the Company and a Subsidiary of the Company may pay dividends incapital stock of such Subsidiary, in each case in accordance with Section 7.04(b) (*Restricted Payments*); and

 

(b)           the Company may issue capital stock ofthe Company in a primary offering (such issuance a “Permitted Company EquityIssuance”); provided that the Company makes any required mandatoryprepayment of the Mandatory Prepayment Indebtedness.

 

For the avoidance of doubt, the Company shall not cause or permit anySubsidiary to issue any capital stock (other than to the Company, but only tothe extent reasonably necessary in connection with an Intercompany IndebtednessCapitalization permitted under Section 7.02(a)(x) (*Investments*)).

 

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ARTICLEVIII

EVENTSOF DEFAULT

 

8.01.        Eventsof Default.  Any of the following events shall constitutean “Event of Default”:

 

(a)           Non-Payment. The Company fails to pay (i) when and as required to be paidherein, any amount of principal of the Loan, (ii) within three (3) days after the same becomes due, any interest payablehereunder or under any other Loan Document or (iii) within five (5) days after thesame becomes due, any other amount payable hereunder (including any amount dueunder any other Loan Document), in each case whether at the due date thereof or at a date fixed formandatory prepayment thereof or by acceleration or otherwise; or

 

(b)           Representation or Warranty. Any representation or warranty by the Company made herein or in anyother Loan Document, or which is contained in any certificate, document orfinancial or other statement by the Company or any Senior Officer of theCompany, furnished at any time under this Agreement or any other Loan Document,is incorrect in any material respect on or as of the date made; or

 

(c)           Specific Defaults. The Company fails to perform or observe any term, covenant or agreementcontained in Sections 6.02(a) (*Notice ofOther Events*), 6.03(a) (*Maintenanceof Existence; Conduct of Business*) with respect to the corporateexistence of the Company and the Material Subsidiaries, 6.05 (*Maintenance of Government Approvals*), 6.08(*Ranking; Priority*) or fails toperform or observe any term, covenant or agreement contained in Article VII(*Negative Covenants*); or

 

(d)           Other Defaults. The Company fails to perform or observe any other term or covenantcontained in this Agreement or in any other Loan Document **(**other than as specified in clauses (a) and(c) above), and such default continues unremedied for a period of thirty(30) days after the earlier of (a) date upon which written notice thereof isgiven to the Company by the Lender or (b) the date on which the Company has knowledge thereof; or

 

(e)           Cross-Default. The Company or any of its Material Subsidiaries (i) fails to makeany payment in respect of any Indebtedness (other than Indebtedness hereunderand under the Note) having an aggregate principal amount (or its US DollarEquivalent) equal to US$20,000,000 (or the US Dollar Equivalent thereof) ormore when due (whether by scheduled maturity, required prepayment, acceleration,demand, or otherwise) and such failure continues after the applicable graceperiod, if any, specified in the agreement or instrument relating to suchIndebtedness; or (ii) fails to perform or observe any other condition orcovenant, or any other event shall occur or condition exist, under anyagreement or instrument relating to such Indebtedness, and such failurecontinues after the applicable grace or notice period, if any, specified in therelevant document on the date of such failure if the effect of such failure,event or condition is to cause, or to permit the holder or holders of suchIndebtedness to cause, such Indebtedness to be declared to be due and payableprior to its stated maturity; or

 

(f)            BBVA Default. There shall have occurred and be continuing an “Event of Default” underthe BBVA Loan (as defined therein); or

 

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(g)           Involuntary Proceedings.  (i) Adecree or order by a court having jurisdiction has been entered adjudging theCompany or any Material Subsidiary as bankrupt or insolvent, or approving asproperly filed a petition seeking reorganization, *concurso mercantil*, *quiebra*or bankruptcy of the Company or any Material Subsidiary and suchdecree or order shall have continued undischarged and unstayed for a period ofsixty (60) consecutive days; or (ii) a decree or order ofa court having jurisdiction for the appointment of a receiver or liquidator or *visitador*, *conciliador* or *síndico*or trustee or assignee in bankruptcy or insolvency or any other similarofficial of the Company or any Material Subsidiary or of any substantial partof the Property of the Company or any Material Subsidiary or for the winding upor liquidation of the affairs of the Company or any Material Subsidiary hasbeen entered, and such decree or order has continued undischarged and unstayedfor a period of sixty (60) consecutive days; or (iii) anywrit or warrant of execution or similar process is issued or levied against anysubstantial part of the Property of the Company or any Material Subsidiary; or

 

(h)           Voluntary Proceedings. The Company or any Subsidiary institutes proceedings to be adjudicatedbankrupt or consents to the filing of a bankruptcy proceeding against it, orfiles a petition or answer or consent in any proceeding seeking reorganization,*concurso mercantil*, *quiebra*or bankruptcy or consents to thefiling of any such petition, or consents to the appointment of a receiver orliquidator or trustee or *visitador*,*conciliador*or s*índico*or assignee in bankruptcy orinsolvency or any other similar official of it or any substantial part of itsProperty, or admits in writing that it is unable to pay its debts, or fails togenerally to pay its debts when they come due or makes a general assignment forthe benefit of creditors; or

 

(i)            Monetary Judgments. One or more judgments, orders, attachments or *embargos*, decrees or arbitration awards are entered againstthe Company or any of its Subsidiaries involving in the aggregate a liability(to the extent not covered by independent third-party insurance as to which theinsurer does not dispute coverage) as to any single or related series oftransactions, incidents or conditions, of an amount (or its US DollarEquivalent) equal to US$20,000,000 (or, if in another currency, the US DollarEquivalent thereof), and the same shall remain unsatisfied, unvacated orunstayed pending appeal for a period of sixty (60)consecutive days after the entry thereof; or

 

(j)            Unenforceability.  Any of the Loan Documents or the Intercompany Revolving Facilities at any time is suspended, revoked or terminated (byany Person other than the Lender) or for any reason ceases to be in full forceand effect in accordance with its respective terms or the binding effect orenforceability thereof, or of thetransactions contemplated thereby, is contested by the Company or its Subsidiaries, or the Company denies that it has any further liability or obligationhereunder or thereunder or in respect hereof or thereof, or performance by theCompany under any of the Loan Documents or the Intercompany Revolving Facilities shallbecome illegal, or the Company shall assert that any obligation under a LoanDocument orIntercompany Revolving Facility has become illegal; or

 

(k)           Expropriation. Any Governmental Authority Expropriates all or a substantial portion of (x) theProperty of the Company and its Subsidiaries taken as a whole or (y) thecommon stock of the Company; or

 

(l)            Change of Control. Any Change in Control has occurred; or

 

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(m)          Intercompany Trust Agreement.  At any time the assignment of rights pursuantto the Intercompany Trust Agreement (i) shall be or become unenforceable, (ii) shallbe contested or denied in writing by any Intercompany Lender or (iii) shallbe contested ordenied in writing by any Governmental Authority and such contest or denialshall continue unstayed for a period of sixty (60) consecutive days; or

 

(n)           Government Approval. Any approval, authorization, consent or registration of a GovernmentalAuthority that is at any time necessary to enable the Company to comply withany of its obligations under any of the Loan Documents is revoked, withdrawn,withheld or otherwise not in full force and effect and is not reinstated to thesatisfaction of the Lender within the earlier of (i) ten (10) daysafter such revocation, withdrawal, withholding or other loss of effectivenessor (ii) the third (3rd) BusinessDay before the day in which it shall be required to enable the Company to complywith its obligations under the Loan Documents; or

 

(o)           ERISA.  (i) AnERISA Event has occurred; (ii) the Company, any Subsidiary or any ERISAAffiliate has been notified by the sponsor of a Multiemployer Plan that it hasincurred Withdrawal Liability to such Multiemployer Plan or that suchMultiemployer Plan is in reorganization or is being terminated, partitioned orreorganized; (iii) the Company or an ERISA Affiliate fails to pay, whendue, after the expiration of any applicable grace period, any installmentpayment with respect to its Withdrawal Liability under Section 4201 ofERISA or (iv) the Company, any Subsidiary or any ERISA Affiliate hasincurred any liability in connection with a withdrawal from a Pension Plansubject to Section 4063 of ERISA, such that, in the case of any eventdescribed in (i), (ii), (iii) or (iv), the Company, any Subsidiary or anyERISA Affiliate has incurred, in the aggregate and aggregating liabilitiesresulting from all such events that have occurred, liability equal to US$20,000,000(or the US Dollar Equivalent thereof) or more; or

 

(p)           Lapse of Process Agent. The Company’s appointment of the Process Agent or the Alternate ProcessAgent shall have lapsed, whether because of nonpayment of fees or otherwise,and such lapse remains unremedied for a period of three (3) Business Daysafter the Company obtains knowledge or receives notice thereof.

 

8.02.        Remedies.  (a) If any Event of Default occurs, the Lender may take any or all of the followingactions:

 

(i)                    declare the unpaid principal amount of the Loan, all interest accrued and unpaid thereon, and allother Obligations owing or payable hereunder or under any other Loan Documentto be immediately due and payable, without presentment, demand, protest orother notice of any kind, all of which are hereby expressly waived by theCompany; and

 

(ii)                   exercise all rights and remediesavailable to the Lender under the Loan Documents or applicable law;

 

(b)           Notwithstanding the foregoing, upon theoccurrence of any event specified in Section 8.01(g) (*Involuntary Proceedings*) or 8.01(h) (*Voluntary Proceedings*), the unpaid 

 

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principal amount of the Loan andall interest and other Obligations shall automatically become due and payable withoutfurther act of the Lender.

 

(c)           After the exercise of remedies providedfor in this Section 8.02 (or after the Loan has automatically becomeimmediately due and payable), any amounts received on account of theObligations shall be applied by the Lender in the following order:

 

(i)                    first, to payment of that portion of theObligations constituting fees, indemnities and other amounts (other thanprincipal and interest) payable to the Lender (including Attorney Costs andamounts payable under Article III (*Taxes,Yield Protection and Illegality*));

 

(ii)                   second, to payment of that portion of the Obligationsconstituting accrued and unpaid interest on the Loan;

 

(iii)                  third, to payment of that portion of the Obligationsconstituting unpaid principal of the Loan; and

 

(iv)                  last, the balance, if any, after all of theObligations have been indefeasibly paid in full, to the Company or as otherwiserequired by law.

 

8.03.        RightsNot Exclusive.  The rights provided for in this Agreement andthe other Loan Documents are cumulative and are not exclusive of any otherrights, powers, privileges or remedies provided by law or in equity, or underany other instrument, document or agreement now existing or hereafter arising.

 

ARTICLEIX

MISCELLANEOUS

 

9.01.        Amendmentsand Waivers.  No amendment or waiver of any provision ofthis Agreement or any other Loan Document, and no consent to any departure bythe Company therefrom, shall be effective unless the same shall be in writingand signed by the Lender and the Company, and then any such waiver or consentshall be effective only in the specific instance and for the specific purposefor which given.

 

9.02.        Notices.

 

(a)           Except as otherwise expressly providedherein, all notices, requests, demands or other communications to or upon anyparty hereunder shall be in English and in writing (including facsimiletransmission and, subject to clause (c) below, a PDF attachment to anelectronic mail message) and shall be mailed by an internationally recognizedovernight courier service, transmitted by facsimile or electronic mail ordelivered by hand to such party: (i) in the case of the Company or theInitial Lender, at its address, facsimile number or electronic mail address setforth on Schedule 9.02 (*Notices*)hereof or at such other address, facsimile number or electronic mail address assuch party may designate by notice to the other parties hereto, and (ii) inthe case of any Lender other than the Initial Lender, at its address, facsimilenumber or electronic mail address set forth in the Administrative Questionnaireor at such other address, 

 

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facsimile number or electronic mail address as theLender may designate by notice to the Company.

 

(b)           Unless otherwise expressly provided forherein, each such notice, request, demand or other communication shall beeffective upon the earlier to occur of (i) actual receipt and (ii) (A) ifsent by overnight courier service or delivered by hand, when signed for by oron behalf of the party to whom such notice is directed, (B) if given byfacsimile, when transmitted to the facsimile number specified pursuant toclause (a) above and confirmation of receipt of a legible copy is receivedby telephone, return facsimile or electronic mail, or (C) if given by anyother means, when delivered at the address specified pursuant to clause (a) above;provided, however, that notices to the Lender under Article II(*The Loan*), Article III (*Taxes, Yield Protection and Illegality*)and this Article IX shall not be effective until received.  Delivery by the Lender by facsimiletransmission or electronic mail of an executed counterpart of any amendment orwaiver or any provision of this Agreement or the Note or any other Loan Documentto be executed and delivered hereunder shall be effective as delivery of amanually executed counterpart thereof.

 

(c)           Electronic mail and internet websites maybe used only to distribute routine communications, such as financialstatements, Casualty Certificates, Reinvestment Certificates, or anycertificate or document required by Article IV (*Conditions Precedent*) (except for the Initial Lender’sNote), Article VI (*AffirmativeCovenants*) or Article VII (*NegativeCovenants*) and other related information, and to distribute LoanDocuments for execution by the parties thereto, and may not be used for anyother purpose.

 

9.03.        NoWaiver; Cumulative Remedies.  No failure toexercise and no delay in exercising, on the part of the Lender, any right,remedy, power or privilege hereunder or under any Loan Document, shall operateas a waiver thereof; nor shall any single or partial exercise of any right,remedy, power or privilege hereunder or thereunder preclude any other orfurther exercise thereof or the exercise of any other right, remedy, power orprivilege.  The rights and remediesherein provided are cumulative and not exclusive of any rights or remediesprovided by law.

 

9.04.        Costsand Expenses.  The Company agrees:

 

(a)           to pay or reimburse the Initial Lender (i) upondemand for all reasonable and documented costs and expenses (including AttorneyCosts) incurred by the Initial Lender in connection with the TerminatedDerivative Obligation and the preparation, negotiation, administration andexecution of the Loan Documents (whether or not consummated) and (ii) withinfive (5) Business Days after demand for all reasonable and documentedcosts and expenses incurred by the Lender in connection with any amendment,supplement, waiver or modification requested by the Company (in each case,whether or not consummated) to this Agreement or any other Loan Document,including Attorney Costs incurred by the Lender with respect thereto; providedthat the obligation of the Company with respect to the reimbursement ofAttorney Costs shall in any event be limited to one (1) US counsel and one(1) local Mexican counsel; and

 

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(b)           to pay or reimburse the Lender withinfive (5) Business Days after demand for all reasonable costs and expenses(including Attorney Costs) incurred by them in connection with the enforcement,attempted enforcement, or preservation of any rights or remedies under thisAgreement or any other Loan Document during the existence of an Event ofDefault or after acceleration of the Loan (including in connection with any “workout”or restructuring regarding the Loan, and including in any insolvency orbankruptcy proceeding involving the Company).

 

9.05.        Indemnificationby the Company.  Whether or not the transactions contemplatedhereby are consummated, the Company agrees to indemnify and hold harmless theLender and its respective Affiliates, directors, officers, employees, counsel,agents and attorneys-in-fact (collectively the “Indemnitees”) from andagainst: (a) any and all direct, punitive and consequential damages,claims, demands, actions or causes of action that are asserted against anyIndemnitee by any Person relating, directly or indirectly, to a claim, demand,action or cause of action that such Person asserts or may assert against the Companyor any of its respective officers or directors, (b) any and all claims,demands, expenses (including Attorney Costs) actions or causes of action thatmay at any time (including at any time following repayment of the Obligationsand the replacement of the Lender) be asserted or imposed against anyIndemnitee, arising out of or relating to, the Loan Documents (including thepreparation, negotiation, execution and administration thereof), or the use orcontemplated use of the proceeds of the Loan, (c) any administrative orinvestigative proceeding by any Governmental Authority arising out of orrelated to a claim, demand, action or cause of action described in (a) or (b) above,and (d) any and all liabilities (including liabilities under indemnities),losses, costs or expenses (including Attorney Costs) that any Indemniteesuffers or incurs as a result of the assertion of any foregoing claim, demand,action, cause of action or proceeding, or as a result of the preparation of anydefense in connection with any foregoing claim, demand, action, cause of actionor proceeding, in all cases, whether or not an Indemnitee is a party to suchclaim, demand, action, cause of action or proceeding (all the foregoing,collectively, the “Indemnified Liabilities”), in all cases, whether ornot caused by or arising, in whole or in part, out of the negligence of theIndemnitee; provided that no Indemnitee shall be entitled toindemnification for any claim caused by its own gross negligence or willfulmisconduct or for any loss asserted against it by another Indemnitee determinedin a final, nonappealable judgment by a court of competent jurisdiction.  No Indemnitees shall be liable for anydamages arising from the use by others of any information or other materialsobtained through any information transmission systems in connection with thisAgreement, nor shall any Indemnitee have any liability for any indirect orconsequential damages relating to this Agreement or any other Loan Document orarising out of its activities in connection herewith or therewith (whetherbefore or after the Closing Date).  Allamounts due under this Section 9.05 shall be payable within ten (10) BusinessDays after demand therefor.  Theagreements in this Section 9.05 shall survive the repayment of allObligations.

 

9.06.        PaymentsSet Aside.  To the extent that the Company makes apayment to the Lender or the Lender exercises its right of set-off, and suchpayment or the proceeds of such set-off or any part thereof are subsequentlyinvalidated, declared to be fraudulent or preferential, set aside or required(including pursuant to any settlement entered into by the Lender in itsdiscretion) to be repaid to a trustee, receiver or any other party, inconnection with any insolvency, “*concursomercantil*” or bankruptcy proceeding involving the Company orotherwise, then to the extent of such recovery, the obligation or part thereoforiginally intended

 

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to be satisfied shall be revived and continued in fullforce and effect as if such payment had not been made or such set-off had notoccurred.

 

9.07.        Successorsand Assigns.  The provisions of thisAgreement shall be binding upon and inure to the benefit of the parties heretoand their respective successors and assigns, except that the Company may notassign or transfer any of its rights or obligations under this Agreementwithout the prior written consent of the Lender (and any attempted assignmentor transfer by the Company without such consent shall be null and void).  Nothing in this Agreement, expressed orimplied, shall be construed to confer upon any Person (other than the partieshereto, their respective successors and assigns permitted hereby and, to theextent expressly contemplated hereby, the Indemnitees) any legal or equitableright, remedy or claim under or by reason of this Agreement.

 

9.08.        Assignments,Participations, Etc.

 

(a)           TheLender may, at any time, assign to one or more assignees other than the Companyor any of its Affiliates or Subsidiaries (each an “Assignee”) all or anypart of its Loan and the other rights and obligations of the Lender hereunder,in a minimum amount of US$3,000,000.  The Company may continue to deal solely and directlywith the Lender in connection with the interest so assigned to an Assignee andthe assignment will not be effective until: (i) written notice of suchassignment, together with payment instructions, addresses and relatedinformation with respect to the Assignee, shall have been given to the Companyby the assigning Lender and the Assignee; and (ii) the assigning Lenderand its Assignee shall have delivered to the Company an Assignment andAcceptance substantially in the form of Exhibit C (an “Assignmentand Acceptance”), together with the Note subject to such assignment.

 

(b)           Fromand after the date that the assigning Lender and its Assignee shall havedelivered to the Company a duly executed Assignment and Acceptance, (i) theAssignee thereunder shall be a party hereto and, to the extent that rights andobligations hereunder have been assigned to it pursuant to such Assignment andAcceptance, shall have the rights and obligations of the assigning Lender underthe Loan Documents, and (ii) the assigning Lender shall, to the extentthat rights and obligations hereunder and under the other Loan Documents havebeen assigned by it pursuant to such Assignment and Acceptance, relinquish itsrights and be released from its obligations under the Loan Documents.

 

(c)           TheCompany shall maintain a copy of each Assignment and Acceptance delivered to itand a register for the recordation of the names and addresses of the Lender andthe principal amount of the Loan owing to the Lender pursuant to the termshereof from time to time (the “Register”).  The entries in the Register shall beconclusive, absent manifest error, and the Company and the Lender may treateach Person whose name is recorded in the Register pursuant to the terms hereofas the Lender hereunder for all purposes of this Agreement, notwithstandingnotice to the contrary.  The Registershall be available for inspection by the Lender at any reasonable time and fromtime to time upon reasonable prior notice.

 

(d)           Withinten (10) Business Days after receipt of an executed Assignment andAcceptance, the Company shall execute and deliver to the Assignee a new Note orNotes in the amount of such Assignee’s assigned Loan and, if the assigningLender has retained a portion of 

 

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its Loan, a replacement Note for the assignor Lender(such Note to be in exchange for, but not in payment of, the Note held by theassigning Lender).  Immediately upon theassigning Lender and its Assignee having delivered to the Company a dulyexecuted Assignment and Acceptance, this Agreement shall be deemed to beamended to the extent, but only to the extent, necessary to reflect theaddition of the Assignee and the resulting adjustment of the Loanarising therefrom.

 

(e)           TheLender (the “originating Lender”) may at any time sell to one or morecommercial banks or other Persons other than the Company or any of itsAffiliates or Subsidiaries (a “Participant”) participating interests inall or any part of its Loan (each a “Participation”); provided, however,that (i) the originating Lender’s obligations under this Agreement shallremain unchanged, (ii) the originating Lender shall remain solely responsiblefor the performance of such obligations, (iii) the Company shall continueto deal solely and directly with the originating Lender in connection with theoriginating Lender’s rights and obligations under this Agreement and the otherLoan Documents and (iv) the Lender shall not transfer or grant anyparticipating interest under which the Participant has rights to approve anyamendment to, or any consent or waiver with respect to, this Agreement or anyother Loan Document.  In the case of anysuch participation, the Lender selling such participation shall be entitled toagree to pay over to the Participant any amounts paid to the Lender pursuant toSection 3.01 (*Taxes*), Section 3.04(*Increased Costs and Reduction of Return*)and Section 3.05 (*Funding Losses*)and if amounts outstanding under this Agreement are due and unpaid, or shallhave been declared or shall have become due and payable upon the occurrence ofan Event of Default, each Participant shall be deemed to have the right ofset-off in respect of its participating interest in amounts owing under thisAgreement to the same extent as if the amount of its participating interestwere owing directly to it as the Lender under this Agreement; providedthat such agreement or instrument may provide that the Lender will not, withoutthe consent of the Participant, agree to any amendment, waiver or othermodification that would (i) postpone any date upon which any payment of moneyis scheduled to be paid to such Participant or (ii) reduce the principal,interest, fees or other amounts payable to such Participant.  Subject to clause (f) of this Section 9.08,the Company agrees that each Participant shall be entitled to the benefits of Section 3.01(*Taxes*), Section 3.04 (*Increased Costs and Reduction of Return*)and Section 3.05 (*Funding Losses*)to the same extent as if it were the Lender and had acquired its interest byassignment pursuant to clause (a) of this Section 9.08.  To the fullest extent permitted by law, eachParticipant also shall be entitled to the benefits of Section 9.10 (*Set-off*) as though it were the Lender.

 

(f)            Exceptif an Event of Default has occurred and is continuing, no Assignee orParticipant shall be entitled to receive any greater payment under Section 3.01(*Taxes*), Section 3.04 (*Increased Costs and Reduction of Return*), Section 3.05(*Funding Losses*) or Section 3.06(*Reserves on Loan*) than theLender would have been entitled to receive with respect to the rightstransferred or participated, unless such transfer or participation is made withthe Company’s prior written consent or at a time when the circumstances givingrise to such greater payment did not exist.

 

(g)           TheLender may at any time pledge or assign a security interest in all or anyportion of its rights under this Agreement to secure obligations of the Lender,including any pledge or assignment to secure obligations to a Federal ReserveBank; provided that no such 

 

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pledge or assignment shall release the Lender from anyof its obligations hereunder or substitute any such pledgee or assignee for theLender as a party hereto.

 

9.09.        Confidentiality.

 

TheLender agrees to maintain the confidentiality of the Information (as definedbelow), except that Information may be disclosed (i) to its and its Affiliates’,directors, officers, employees and agents, including accountants, legal counseland other advisors (it being understood that the Persons to whom suchdisclosure is made will be informed of the confidential nature of suchInformation and instructed to keep such Information confidential); (ii) tothe extent requested by any regulatory or self-regulatory authority includingany securities exchange; (iii) to the extent required by applicable lawsor regulations or by any subpoena or similar legal process; (iv) to any director indirect credit insurance provider, insurer, insurance broker or ratingagencies relating to the Company and the Obligations (v) to any otherparty to this Agreement; (vi) in connection with the exercise of anyremedies hereunder or any suit, action or proceeding relating to this Agreementor the enforcement of rights hereunder; (vii) subject to an agreementcontaining provisions substantially the same as those of this Section 9.09,to (1) any Assignee of or Participant in, or any prospective Assignee ofor Participant in, any of its rights or obligations under this Agreement or (2) anydirect or indirect contractual counterparty or prospective counterparty (orsuch contractual counterparty’s or prospective counterparty’s professionaladvisor) to any derivative or hedging transaction relating to obligations ofthe Company; (viii) with the consent of the Company; (ix) upon theoccurrence of any Event of Default; or (ix) to the extent such Information(1) becomes publicly available other than as a result of a breach of this Section or(2) becomes available to the Lender on a nonconfidential basis from a sourceother than the Company.  In addition, theLender may disclose the existence of this Agreement and information about thisAgreement to market data collectors, similar service providers to the lending industry,and service providers to the Lender in connection with the administration andmanagement of this Agreement, the other Loan Documents, the Participations, andthe Loan.  For purposes of this Section, “Information”means all information received from the Company relating to the Company and/orits business, other than any such information that is available to the Lenderon a nonconfidential basis prior to disclosure by the Company; providedthat, in the case of information received from the Company after the datehereof, such information shall be deemed not to be confidential unless it isclearly identified in writing at the time of delivery as confidential or it isapparent on its face that such information is confidential.  Any Person required to maintain theconfidentiality of Information as provided in this Section shall beconsidered to have complied with its obligation to do so if such Person hasexercised the same degree of care to maintain the confidentiality of suchInformation as such Person would accord to its own confidentialinformation.  This Section 9.09shall supersede any prior confidentiality agreements entered into between theCompany and the Initial Lender, and all Information provided prior to the datehereof shall be subject to this Section 9.09.

 

9.10.        Set-off.  In addition to any rights and remedies of theLender provided by law, if an Event of Default exists or the Loan has beenaccelerated, the Lender is authorized at any time and from time to time,without prior notice to the Company, any such notice being waived by theCompany to the fullest extent permitted by law, to set off and apply any andall deposits (general or special, time or demand, provisional or final in anycurrency, matured or unmatured) at any time held by, and other Indebtedness atany time owing by, the Lender to or for the credit or the 

 

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account of the Company against any and all Obligationsowing to the Lender, now or hereafter existing, irrespective of whether or notthe Lender shall have made demand under this Agreement or any Loan Document andalthough such Obligations may be contingent or unmatured.  The Lender agrees promptly to notify theCompany after any such set-off and application made by the Lender; provided,however, that the failure to give such notice shall not affect thevalidity of such set-off and application.

 

9.11.        Notificationof Addresses, Lending Offices, Etc. The Lender shall notify the Company in writing of any changes in theaddress to which notices to the Lender should be directed, of addresses of itsLending Office, of payment instructions in respect of all payments to be madeto it hereunder and of such other administrative information as the Companyshall reasonably request.

 

9.12.        Counterparts.  This Agreement may be executed in any numberof separate counterparts, each of which, when so executed, shall be deemed anoriginal, and all of said counterparts taken together shall be deemed toconstitute but one and the same instrument.  Delivery of an executed counterpart of asignature page to this Agreement by facsimile or electronic mail shall beeffective as delivery of a manually executed counterpart of this Agreement.

 

9.13.        Severability.  The illegality or unenforceability of any provisionof this Agreement or any instrument or agreement required hereunder shall notin any way affect or impair the legality or enforceability of the remainingprovisions of this Agreement or any instrument or agreement required hereunder.

 

9.14.        GoverningLaw.  THIS AGREEMENT SHALL BEGOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEWYORK.

 

9.15.        Consentto Jurisdiction; Waiver of Jury Trial.

 

(a)           Eachof the parties hereto hereby irrevocably and unconditionally submits, in anyaction or proceeding arising out of or relating to this Agreement, any otherLoan Document or the transactions contemplated hereby, to the exclusivejurisdiction of any New York State or federal court sitting in New York Cityand any appellate court thereof (a “Specified Court”).

 

(b)           Eachof the parties hereto hereby irrevocably waives, to the fullest extent it mayeffectively do so, the defense of an inconvenient forum to the maintenance ofsuch action or proceeding, the right to object that any Specified Court doesnot have any jurisdiction over such party, and any right of jurisdiction insuch action or proceeding to which it may otherwise be entitled.

 

(c)           EACHOF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY RIGHTS IT MAY HAVE TOA TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED UPON, OR ARISING OUT OF,THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OFDEALING, STATEMENT OR ACTIONS OF THE LENDER OR THE COMPANY RELATING THERETO.

 

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(d)           TheCompany hereby irrevocably appoints CT Corporation (the “Process Agent”),with an office on the date hereof at, 111 EighthAvenue, New York, New York 10011 or, if service cannot be effectuated on the ProcessAgent, Gruma Corporation (the “Alternate Process Agent”), with an officeon the date hereof at 1159 Cottonwood Ln., Irving, TX 75038, Attention: VicePresident of Legal Services, as its agent to receive on behalf of the Companyservice of the summons and complaint and any other process which may be servedin any action or proceeding brought in any New York state or federal courtsitting in New York City.  Such servicemay be made by mailing or delivering a copy of such process to the Company, in careof the Process Agent or the Alternate Process Agent, as applicable, at theaddress specified above for the Process Agent or the Alternate Process Agent,as applicable, and the Company hereby irrevocably authorizes and directs theProcess Agent and the Alternate Process Agent, as applicable, to accept suchservice on its behalf.  Such appointmentshall be contained in a notarial instrument that complies with the 1940Protocol on Uniformity of Powers of Attorney to be utilized abroad as ratifiedby the United States and Mexico.

 

(e)           Finaljudgment in any such action or proceeding shall be conclusive and may beenforced in other jurisdictions by suit on the judgment or in any other mannerprovided by law.

 

9.16.        Waiverof Immunity.  The Companyacknowledges that the execution and performance of this Agreement and eachother Loan Document is a commercial activity and to the extent that the Companyhas or hereafter may acquire any immunity from any legal action, suit orproceedings, from jurisdiction of any court or from set-off or any legal process(whether service or notice, attachment prior to judgment, attachment in aid ofexecution of judgment, execution of judgment or otherwise) with respect toitself or any of its Property, whether or not held for its own account, theCompany, to the fullest extent permitted by applicable law, hereby irrevocablyand unconditionally waives and agrees not to plead or claim such immunity inrespect of its obligations under this Agreement or any other Loan Document.

 

9.17.        Paymentin US Dollars; Judgment Currency.

 

(a)           Allpayments by the Company to the Lender hereunder shall be made in US Dollars andin immediately available funds and in such funds as are customary at the timefor the settlement of international transactions.

 

(b)           Iffor purposes of obtaining judgment against the Company with respect to itsobligations under this Agreement or the Note in any court it is necessary toconvert a sum due under this Agreement in US Dollars into another currency (the“Other Currency”), the Company agrees, to the fullest extent permittedby applicable law, that the rate of exchange used shall be that at which inaccordance with normal banking procedures the Lender could purchase US Dollarswith the Other Currency on the Business Day preceding that on which finaljudgment is given.

 

(c)           Theobligation of the Company in respect of any sum due under this Agreement or theNote shall, notwithstanding any judgment in any Other Currency, be dischargedonly to the extent that on the Business Day following receipt by the Lender ofany sum adjudged to be so due in the Other Currency the Lender may inaccordance with normal banking procedures purchase US Dollars with the OtherCurrency; if the amount of US Dollars so purchased is less 

 

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than the sum originally due to the Lender in USDollars, the Company hereby agrees, as a separate obligation andnotwithstanding any such judgment, to indemnify the Lender against such loss.

 

9.18.        Change to IFRS.  If the Company intends or is required toadopt IFRS, the Company and the Lender shall, at least one hundred and twenty(120) days prior to such adoption, commence to negotiate in good faith with aview to agreeing such written amendments to the financial covenants in Sections7.09 (*Interest Coverage Ratio*)and 7.10 (*Leverage Ratio*) and, ineach case, the definitions used therein and the equivalent definitions in thesecurity documents in respect of the Secured Indebtedness, as may be necessaryto ensure that the criteria for evaluating the Company’s financial condition (i) notprejudice the Company in terms of its compliance with the terms of thisAgreement more than, and (ii) grant to the Lender protection equivalent tothat which would have been enjoyed, in each case, had the Company not adoptedIFRS (such amendments, the “IFRS Amendments”).  If no written agreement with respect to anyof the IFRS Amendments is reached within sixty (60) days prior to the Company’sadoption of IFRS, then the Company and the Lender shall submit their differingpositions with respect to the IFRS Amendments to a Qualified Accountantselected by the mutual agreement of the parties, which in any event shall bethe same Qualified Accountant selected in this respect for the MandatoryPrepayment Indebtedness.  The QualifiedAccountant shall consider only the IFRS Amendments and shall only make adecision with respect thereto that is within the bounds set by the differingpositions of the Lender and the Company. The Qualified Accountant’s decision with respect thereto shall be finaland binding on the parties hereto and shall be made in writing and notified tothe parties hereto at least five (5) Business Days prior to the adoptionof IFRS by the Company.  Any IFRSAmendments agreed between the Company and the Lender or determined by theQualified Accountant shall take effect as of the date of the Company’s adoptionof IFRS.  The parties agree that noamendment fee shall be payable by the Company to the Lender in respect of anyIFRS Amendments other than payments or reimbursements in accordance with Section 9.04(a) (*Costs and Expenses*) of reasonable anddocumented costs (including Attorney Costs and the fees of the QualifiedAccountant) incurred by the Lender in connection with such IFRS Amendments.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to beduly executed and delivered by their proper and duly authorized officers as ofthe day and year first above written.

 
|   | GRUMA, S.A.B. de C.V. |
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|   | By:                   |   |
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*Signature Page to*

*Loan Agreement*

 

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THIS PAGE IS A SIGNATURE PAGE FOR THE LOAN AGREEMENT, AS OF THE DATEFIRST WRITTEN ABOVE,AMONG GRUMA, S.A.B. DE C.V., AS THE BORROWER, AND THE LENDER

 
|   | BARCLAYS BANK PLC, |
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|   | as Lender          |
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