** **

**Exhibit 2(b)(9)**
|   |
|--------|

 

US$13,900,000

 

LOAN AGREEMENT

 

Dated as of October 16,2009

 

by and between

 

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

 

and

 

ABN AMRO BANKN.V.,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                                                                 |       | 33       |
| 2.03.       | Procedure for Making of  Loan                                                             |       | 33       |
| 2.04.       | Voluntary Prepayments                                                                     |       | 33       |
| 2.05.       | Mandatory Prepayments                                                                     |       | 34       |
| 2.06.       | Repayment of the Loan                                                                     |       | 36       |
| 2.07.       | Interest                                                                                  |       | 37       |
| 2.08.       | Computation of Interest  and Fees                                                         |       | 38       |
| 2.09.       | Payments by the Company                                                                   |       | 38       |
| 2.10.       | Promise to Pay                                                                            |       | 38       |
|        |                                                                                      |       |     |
| ARTICLE III | TAXES, YIELD PROTECTION  AND ILLEGALITY                                                   |       | 39       |
|        |                                                                                      |       |     |
| 3.01.       | Taxes                                                                                     |       | 39       |
| 3.02.       | Illegality                                                                                |       | 40       |
| 3.03.       | Inability to Determine  Rates                                                             |       | 41       |
| 3.04.       | Increased Costs and  Reduction of Return                                                  |       | 41       |
| 3.05.       | Funding Losses                                                                            |       | 42       |
| 3.06.       | Reserves on Loan                                                                          |       | 42       |
| 3.07.       | Certificates of the  Lender                                                               |       | 43       |
| 3.08.       | Change of Lending  Office                                                                 |       | 43       |
| 3.09.       | Substitution of Lender                                                                    |       | 43       |
| 3.10.       | Survival                                                                                  |       | 44       |
|        |                                                                                      |       |     |
| ARTICLE IV  | CONDITIONS PRECEDENT                                                                      |       | 44       |
|        |                                                                                      |       |     |
| 4.01.       | Conditions to Closing  Date                                                               |       | 44       |
|        |                                                                                      |       |     |
| ARTICLE V   | REPRESENTATIONS AND  WARRANTIES                                                           |       | 48       |
|        |                                                                                      |       |     |
| 5.01.       | Corporate Existence and  Power                                                            |       | 48       |
| 5.02.       | Corporate Authorization;  No Contravention                                                |       | 49       |
| 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 |       | 50       |
| 5.07.       | Pari Passu                                                                                |       | 50       |
| 5.08.       | Taxes                                                                                     |       | 50       |
| 5.09.       | Environmental Matters                                                                     |       | 51       |

 

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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.                                                   |       | 52       |
| 5.12.       | Subsidiaries                                                                                  |       | 52       |
| 5.13.       | Commercial Acts                                                                               |       | 52       |
| 5.14.       | Proper Legal Form                                                                             |       | 53       |
| 5.15.       | Full Disclosure                                                                               |       | 53       |
| 5.16.       | Investment Company Act                                                                        |       | 53       |
| 5.17.       | Margin Regulations                                                                            |       | 54       |
| 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                                                                               |       | 63       |
| 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                                                                         |       | 71       |
| 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                                                                                |       | 72       |
| 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            |       | 73       |

 

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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       |

 

iii

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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 ABN AMRO BANKN.V., a public limited liability company organized under the laws of theNetherlands (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, pursuant to that certain Unwind Agreement letter dated July 6,2009, by and between the Company and The Royal Bank of Scotland PLC (“RBS”)(i) the Confirmation was entered into between the Company and RBS,pursuant to which the Company incurred the Terminated Derivative Obligation toRBS, and (ii) the Initial Lender which is an affiliate of RBS, entirelyassumed all of the rights, interests and obligations of RBS in the TerminatedDerivative Obligation arising out of the Confirmation;

 

WHEREAS the Company is obligated to pay the Terminated DerivativeObligation to the Initial Lender as evidenced by that certain IndicativeFinancing Terms for Restructuring of Gruma’s Indebtedness term sheet dated July 6,2009, by and between the Company and Initial Lender;

 

WHEREAS, the Company has requested that the Initial Lender make orextend credit to the Company in the form of the Loan to satisfy the TerminatedDerivative Obligation in an aggregate principal amount of US$13,900,000; 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:

 

ARTICLEI

DEFINITIONS

 

1.01.        CertainDefined Terms.  As used in thisAgreement and in any Schedules and Exhibits to this Agreement, the followingcapitalized terms have the 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

 

1

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Company agreed to pay each Advisor for professionalservices and to reimburse such Advisor’s expenses as provided in each suchAdvisor 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.

 

“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 the Companyand 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*).

 

2

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“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 anddocumented fees and disbursements of any law firm or other external counsel, and, without duplication, the reasonableallocated cost of internal legalservices and all reasonable and documented disbursements of internal counsel.

 

“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) from suchExcess Cash Year that is not required to be applied to the mandatory repaymentof 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.

 

3

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“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 having the force of law,in each case, regarding capital adequacy of any bank or of any corporationcontrolling 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 directobligation of (or unconditionally guaranteed by) the United States of Americaor a state thereof, any OECD country or other foreign government in ajurisdiction in which the Company or any of its Subsidiaries currently has orcould have operations (or any agency or political subdivision thereof, to theextent such obligations are supported by the full faith and credit of theUnited States of America or a statethereof, any OECD country or other 

 

4

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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 than 50% of the then aggregate oustanting principal amount of the MajorDerivative Counterparty Loan and (ii) US$55,000,000 (or the US DollarEquivalent thereof)) shall be used to Restore any Properties in respect ofwhich such Net Cash Proceeds were paid (which certificate shall set forth inreasonable detail an estimate of the Net Cash Proceeds to be so expended).

 

“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 family members(including his former spouse, his siblings and other lineal descendants,estates and heirs, or any trust or other investment vehicle for the primarybenefit of any such Person or their respective family members or heirs)(collectively the “Controlling Stockholder”) shall fail to own, directlyor indirectly, beneficially and of record, shares (or American DepositaryReceipts representing shares) representing at least 35% of the aggregateordinary voting power and economic rights represented by the issued andoutstanding capital stock of the Company; (b) the Controlling Stockholdershall cease to have the unconditional right (including the right without theconsent or approval of any other Person), or shall fail, to nominate a majorityof the board of directors of the Company and the chairman of the board ofdirectors of the Company; or (c) any change in control (or similar event,however denominated) with respect to the Company shall occur under and asdefined in any indenture or agreement in respect of Indebtedness to which theCompany 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.

 

5

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“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.

 

“Confirmation” means the termination transaction entered into onJuly 6, 2009 between the Company and RBS pursuant to which the TerminatedDerivative Obligation between the Company and the Initial Lender arose.

 

“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 operatingincome of the Company and its Consolidated Subsidiaries for such MeasurementPeriod , (iv) any cash dividends or other cash distributions or paymentsreceived from Grupo Financiero Banorte S.A.B. de C.V. during such MeasurementPeriod, and (v) any cash dividends or other cash distributions or paymentsreceived (directly or indirectly) from the Venezuelan Subsidiaries during suchMeasurement Period *minus* (b) thesum, without duplication, of (i) Venezuelan EBITDA for such MeasurementPeriod, (ii) any other non-cash income included in the calculation ofconsolidated operating income of the Company and its Consolidated Subsidiariesfor such Measurement Period, and (iii) any cash payments made to anySubsidiary that is part of the Venezuelan Division during such MeasurementPeriod; provided that in making theforegoing calculations (other than in respect of the calculation of ExcessCash), pro forma effect will be given to the acquisition or Disposition ofPersons, divisions or lines of businesses by the Company or any Subsidiary (other than any Subsidiarythat is part of the Venezuelan Division) of the Company that haveoccurred since the beginning of such Measurement Period as if such events hadoccurred, and, in the case of any Disposition, the proceeds thereof applied, ineach case including any incurrence or assumption of Indebtedness in connectiontherewith, 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.

 

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“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 voting power, by contract orotherwise.  “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 

 

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transfer of capital stock of any Person that wasissued and outstanding on the date of such sale, issuance, exchange,conveyance, assignment, other disposition or other transfer and (ii) any sale, issuance, exchange,conveyance, assignment, license, other disposition or other transfer (including by way of a merger or consolidation)with or without recourse, of any notes or accounts receivable or any rights andclaims associated 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.

 

“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 havingjurisdiction over the Company, any of its Subsidiaries or their respectiveproperties, in each case relating to environmental or health and safetymatters.

 

“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 

 

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defined in Section 4001(a)(2) of ERISA) or acessation 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 of proceedingsby 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*).

 

“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 Company US$39,600,000through but excluding the Closing Date, and US$26,000,000 thereafter.

 

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

 

“Fiscal Quarter” means a period of three (3) consecutive calendarmonths 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.

 

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“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 and indirectSubsidiaries.

 

“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.

 

“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 

 

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by such Board of Directors comprised of two or moremembers thereof) in accordance with Section 7.18(b)(iii) (*Limitations on 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 *InstitutoMexicano del Seguro Social*of Mexico.

 

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

 

(a)           any obligation ofsuch Person in respect of borrowed money or with respect to deposits of anykind (if any) and any obligation of such Person evidenced by bonds, notes,debentures or similar instruments;

 

(b)           any obligation ofsuch Person in respect of a lease, including Capital Lease Obligations, or hirepurchase contract, in each case, that would, under Mexican GAAP (or, in thecase of Persons organized under laws of any other jurisdiction, the applicableGAAP therein), be treated as a financial or capital lease, including all Attributable Debt of suchPerson in respect of Sale Lease-Back Transactions of such Person;

 

(c)           any obligation ofothers secured by (or for which the holder of such obligation has an existingright, contingent or otherwise to be secured by) a Lien on any Property of suchPerson, whether or not such obligation is assumed by such Person;

 

(d)           any obligations ofsuch Person to pay the deferred purchase price of Property or services if suchdeferral extends for a period in excess of sixty (60) days;

 

(e)           any GuarantyObligations of such Person which could require such Person to make a payment;

 

(f)            the Agreement Valueof any Hedging Agreements;

 

(g)           any obligations ofsuch Person upon which interest charges are paid or accrued or are customarilypaid or accrued;

 

(h)           any obligations ofsuch Person under conditional sale or other title retention agreements relatingto Property purchased by such Person;

 

(i)            any obligations ofsuch Person to purchase, redeem, retire, defease or otherwise make any payment(other than dividend 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 ofsuch Person as an account party in respect of letters of credit;

 

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(k)           any obligations ofsuch Person in respect of bankers’ acceptances, bank guaranties, surety bondsand similar instruments; and

 

(l)            any Probable Bondsfor or in connection with liabilities arising from Proceedings in which suchPerson 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) lessthan sixty (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;

 

(ii)           operating expenses that accrue andbecome payable in the Ordinary Course of Business;

 

(iii)          customer advance payments and customerdeposits received 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 enteredinto in accordance with Section 7.21 (*ReportoContracts*) 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 *Instituto Nacional del Fondo de la Vivienda para losTrabajadores*of Mexico.

 

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

 

“Initial Lender” means ABN AMRO BANK N.V.

 

“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.

 

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“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.

 

“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.

 

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“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 onthe date the Loan is made and ending on November 21, 2009.

 

(b)           if any InterestPeriod would otherwise end on a day that is not a Business Day, that InterestPeriod shall be extended to the following Business Day unless the result ofsuch extension would be to carry such Interest Period into another calendarmonth, in which event such Interest Period shall end on the next precedingBusiness Day;

 

(c)           any Interest Periodthat begins on the last Business Day of a calendar month (or on a day for whichthere is no numerically corresponding day in the calendar month in which suchInterest Period is to end) shall end on the last Business Day of the calendarmonth in which such Interest Period is to end; and

 

(d)           no Interest Periodshall extend beyond the 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, guarantyof or other contingent obligation with respect to debt or any other liabilityor obligations of, or purchase or other acquisition of any other debt or equityparticipation or ownership or other interest in, another Person, including anypartnership 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.

 

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“Lender” has the meaning specified in theintroductory clause hereto, and includes each Substitute Lender and eachAssignee that becomes a Lender pursuant to Section 9.08 (*Assignments, Participations, Etc*.).

 

“Lender’s Payment Office” means the address forpayments set forth on the signature pages hereto, or such other address asthe Lender may from time to time specify to the other parties hereto.

 

“Lending Office” means, as to any Lender, theoffice or offices of such Lender specified as its “Lending Office” in theAdministrative Questionnaire, as from time to time amended, or such otheroffice or offices as such Lender may from time to time notify the Company.

 

“Leverage Ratio” means, on any date, the ratioof (a) Total Indebtedness of the Company and its Consolidated Subsidiarieson such date to (b) Consolidated EBITDA of the Company and itsConsolidated Subsidiaries determined for the Measurement Period ended on suchdate (or, if such date is not the last day of a Fiscal Quarter, the last day ofthe most recent Fiscal Quarter ended prior to such date)**;**providedthat for the purposes of calculating the Leverage Ratio, Consolidated EBITDAshall not include any payments received by the Company from the Subsidiaries inthe Venezuelan Division in respect of the sale of shares of capital stock ofthe Subsidiaries in the Venezuelan Division, Dispositions of Property bySubsidiaries in the Venezuelan Division and other nonrecurring extraordinarypayments by Subsidiaries in the Venezuelan Division.

 

“LIBOR” means for any Interest Period withrespect to any LIBOR Loan:

 

(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 any InterestPeriod, 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) anysecurity interest, 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 

 

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of securities, anypurchase option, call or similar right of a third party with respect to suchsecurities.

 

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

 

“Loan Documents” means this Agreement, theNote, the Intercompany Trust Agreement, the Intercompany SubordinationAgreement and all other related agreements and documents issued or deliveredhereunder or thereunder or pursuant hereto or thereto or in connection herewithor therewith, in each case as such Loan Document may be amended, supplementedor otherwise modified from time to time.

 

“Major Derivative Counterparties” means each of(i) Credit Suisse, Cayman Islands Branch, (ii) Deutsche Bank AG,London Branch, (iii) JPMorgan Chase Bank N.A. and any of their respectivesuccessors and assigns and includes each “Substitute Lender” and each “Assignee”that becomes a “Lender” (as such terms are used in the Major DerivativeCounterparty Loan) pursuant to the Major Derivative Counterparty Loan.

 

“Major Derivative Counterparty Loan” means theloan provided to the Company pursuant to the US$668,282,700 Senior Secured LoanAgreement, dated on or about the date hereof, as amended from time to time, byand among the Company, Deutsche Bank Trust Company Americas, as AdministrativeAgent, The Bank of New York Mellon, as Collateral Agent, and the lenders partythereto from time to time.

 

“Mandatory Prepayment Indebtedness” means theMajor Derivative Counterparty Loan and the BBVA Loan.

 

“Material Adverse Effect” means any event,change, circumstance, condition, occurrence, effect, development or state offact that, individually or together with any other event, change, circumstance,condition, occurrence, effect, development or state of fact, has had: (a) amaterial adverse change 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 theCompany and its Subsidiaries taken as a whole; (b) a material impairmentof the ability of the Company to perform its obligations under any LoanDocument to which it is or will be a party; (c) a material adverse effectupon the legality, validity, binding effect or enforceability against theCompany of any Loan Document to which it is or will be a party; or (d) amaterial impairment of the rights and remedies of or benefits available to theLender under any Loan Document to which it is or will be a party.

 

“Material Operating Subsidiary” means each ofGimsa, 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:

 

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(i)            the Company’s and its Subsidiaries’ investments in oradvances to such Subsidiary exceed 5% of the total assets of the Companyand its Consolidated Subsidiaries as of the end of the Company’s most recentlycompleted Fiscal Year;

 

(ii)           the Company’s and its Subsidiaries’ proportionateshare of the total assets (after intercompany eliminations) of such Subsidiaryexceeds 5% of the total assets of the Company and its ConsolidatedSubsidiaries as of the end of the Company’s most recently completed FiscalYear; or

 

(iii)          the Company’s and its Subsidiaries’ proportionateshare of the earnings before income tax and employee statutory profit sharingof such Subsidiary exceeds 5% of such earnings of the Company and itsConsolidated Subsidiaries as of the end of the Company’s most recentlycompleted Fiscal Year;

 

in each case as calculated by reference to the lastaudited or unaudited balance sheet or income statement prepared for suchSubsidiary and the then latest audited or unaudited consolidated balance sheetor income statement 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 ifsuch day is not a 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) Mexican Generally Accepted Accounting Principles (*Principios de Contabilidad Generalmente Aceptados*) issued bythe Mexican Accounting Principles Commission of the Mexican Institute of PublicAccountants effective until December 31, 2005, (ii) the MexicanFinancial Information Standards (*Normas de InformaciónFinanciera*) issued by the Mexican Council for the Research andDevelopment 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 lawful currency of Mexico.

 

“Mexico” means the United Mexican States.

 

“Ministry of Finance” means the Ministry ofFinance and Public Credit (*Secretaría deHacienda y Crédito Público*) of Mexico.

 

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“Minor Derivative Counterparties” means theLender and the Other Minor Derivative Counterparties, and includes each “SubstituteLender” and each “Assignee” that becomes a “Lender” pursuant to the MinorDerivative Counterparty Loans.

 

“Minor Derivative Counterparty Loans” means theLoan and the Other Minor Derivative Counterparty Loans.

 

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

 

“Molinera Division” means Molinera togetherwith its direct and indirect Subsidiaries.

 

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

 

“Multiemployer Plan” means any employee benefitplan of the type described in Section 4001(a)(3) of ERISA, to whichthe Company or any ERISA Affiliate makes or is obligated to make contributions,or during the preceding three calendar years, has made or been obligated tomake contributions.

 

“Net Cash Proceeds” means, with respect to anyevent:

 

(a) the cash proceeds received in respect of suchevent, including (i) any cash and cash equivalents received by way ofdeferred payment pursuant to, or by monetization of, a note receivable orotherwise, and (ii) in the case of a Casualty Event, insurance awards;

 

*minus*

 

(b) the sum, as applicable and withoutduplication, of (i) all reasonable and customary fees, underwritingdiscounts, commissions, premiums and out-of-pocket expenses paid by the Companyand its Subsidiaries to third parties (other than Affiliates) in connectionwith such event, (ii) in the case of a Disposition of Property, the amountof all payments required to be made by the Company and its Subsidiaries as aresult of such event to repay Indebtedness (other than the Loan) secured bysuch Property or otherwise that is required by the terms of such Indebtednessto be repaid as a result of such Disposition, (iii) in the case of aCasualty Event, the aggregate amount of proceeds of business interruptioninsurance, and (iv) the amount of all taxes required to be paid andreasonably expected to be paid in accordance with past practice by the Companyand its Subsidiaries in connection with such event, including, for theavoidance of doubt, any taxes required to be paid and reasonably expected to bepaid in accordance with past practice by the Company and its Subsidiaries inconnection with the distribution of such cash proceeds from the Subsidiary thatreceived such cash proceeds to the Company.

 

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

 

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“Notice of Borrowing” means a notice containingthe information specified in Section 2.03(a) (*Procedure for Making of Loan*)substantially in the form of Exhibit G.

 

“Obligations” means all advances, debts,liabilities, obligations, covenants and duties arising under any Loan Documentowing by the Company to the Lenderor anyindemnified person, whether direct or indirect (including those acquired byassignment), absolute or contingent, due or to become due, now existing orhereafter arising.

 

“OECD” means the Organization for EconomicCooperation and Development.

 

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

 

“Officer” means, with respect to the Company, apresident, senior vice president, managing director, chief marketing officer,chief administrative officer, chief technology officer, chief corporateofficer, director of corporate communications, chief procurement officer,secretary of the board, treasurer or principal financial officer, comptrolleror principal accounting officer of such Person, and any officer havingsubstantially the same authority and responsibility as any of theforegoing.  For the avoidance of doubt,the term “Officer” shall include all persons listed as officers of the Companyin the Company’s most recent annual report filed on Form 20-F with the USSecurities and Exchange Commission.

 

“Ordinary Course of Business” means, withrespect to a Person, the ordinary course of business consistent with pastpractice of such Person.

 

“Organizational Documents” means, with respectto a Person, each of the organizational and/or constituent documents of suchPerson, in each case including allamendments thereto,including the articles or certificate of incorporation or *acta constitutiva* and the by-laws or *estatutos sociales*, or equivalentdocuments,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 theCompany and its Subsidiaries other than Working Capital Indebtedness andIntercompany Indebtedness.

 

“Other Minor Derivative Counterparties” meanseach of Barclays Bank PLC, Standard Chartered Bank and BNP Paribas.

 

“Other Minor Derivative Counterparty Loans”means the loans provided to the Company by each of the Other Minor DerivativeCounterparties pursuant to the loan agreements, dated on or about the datehereof, as amended, modified or supplemented from time to time.

 

“Other Prepayment Indebtedness” means the MinorDerivative Counterparty Loans, the Major Derivative Counterparty Loan and theBBVA Loan.

 

“Other Prepayment Pro Rata Amount” means, as ofany date, with respect to any Other Prepayment Indebtedness, a fraction(expressed as a decimal, rounded to the second decimal place), the numerator ofwhich is the aggregate Dollar Amount of such Other Prepayment 

 

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Indebtedness as of such date, and the denominator ofwhich is the sum of the aggregate Dollar Amount of all Other PrepaymentIndebtedness on such date.

 

“Other Restructured Indebtedness” means theMajor Derivative Counterparty Loan, the Other Minor Derivative CounterpartyLoans, the BBVA Loan and the Bancomext Loan.

 

“Other Taxes” means, with respect to anyPerson, any present or future stamp, court or documentary taxes or any otherexcise or property taxes, or charges, imposts, duties, fees or similar levieswhich arise from any payment made hereunder or any other Loan Document or fromthe execution, delivery or registration of, or otherwise with respect to, thisAgreement or any other Loan Document and which are actually imposed, levied,collected or withheld by any Governmental Authority.

 

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

 

“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 GuarantyCorporation referred to and defined in ERISA and any successor entityperforming similar functions.

 

“Pension Plan” means any “employee pensionbenefit plan” (as such term is defined in Section 3(2) of ERISA),other than a Multiemployer Plan, that is subject to Title IV of ERISA and issponsored or maintained by the Company or any ERISA Affiliate or to which theCompany or any ERISA Affiliate contributes or has an obligation to contribute,or in the case of 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 the meaning specified in Section 7.12(b) (*Fundamental Changes, Limitations on Asset Sales,Asset Exchanges and Acquisitions*).

 

“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 |   |

 

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“Permitted Company Equity Issuance” has themeaning specified in Section 7.22(b) (*Equity Issuances*).

 

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

 

“Permitted New Capital Obligations” has themeaning specified in Section 7.16(g)(ii) (*Limitations on Incurrence of Additional Indebtedness*).

 

“Permitted New Indebtedness” has the meaningspecified in Section 7.16(g) (*Limitationson 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.

 

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

 

“Permitted Prepayment Asset Sale” means anyAsset Sale other than (a) the Existing Venezuelan Sale, (b) AssetSales by any Subsidiary that is part of the Venezuelan Division, to the extentsuch Subsidiary is prohibited by Venezuelan laws or regulations fromtransferring or paying such Net Cash Proceeds out of Venezuela, and (c) ProhibitedCollateral Sales.

 

“Permitted Refinancing Indebtedness” meansIndebtedness incurred by the Company or its Subsidiaries to Refinance (i) theOther Prepayment Indebtedness, (ii) the Bancomext Loan or (iii) Indebtednessof Subsidiaries 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 Indebtedness has:

 

(A)          a weighted average maturity that is equal to orgreater than the weighted average maturity of (x) the Indebtedness being Refinancedand (y) the Loan, and

 

(B)           a final maturity that is equal to or greater than thefinal maturity of (x) the Indebtedness being Refinanced and (y) theLoan;

 

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

 

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(iv)          if the Indebtedness beingRefinanced is Subordinated Indebtedness, then such Company Refinancing Indebtedness shall besubordinate to the Loan and any other senior Indebtedness at least to the sameextent and in the same manner as the Indebtedness being Refinanced;

 

(v)           such Company Refinancing Indebtedness is incurredpursuant to (i) terms and pricing that reflect market terms and pricingfor the Company and (ii) terms that are no less favorable to the Companythan the terms and conditions contained hereunder;

 

(vi)          such Company Refinancing Indebtedness is secured, ifat all, by the same collateral as, and to an extent no greater than, theIndebtedness being Refinanced, and if such Company Refinancing Indebtedness isincurred to Refinance the Mandatory Prepayment Indebtedness, such CompanyRefinancing Indebtedness is secured, if at all, on a *pari passu* basis with such Refinanced Mandatory 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 such CompanyRefinancing Indebtedness 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) and any other Indebtedness that is required to beprepaid pursuant to Section 2.05(d) (*MandatoryPrepayments*) (and any breakage costs in connection therewith) withinfive (5) Business Days of the incurrence of such Company RefinancingIndebtedness;

 

(ix) inthe case 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 Refinancing Indebtednessincurred to Refinance the Bancomext Loan:

 

(A)          the aggregate amount of scheduled amortizations undersuch Company Refinancing Indebtedness on any date cannot exceed the aggregateamount of scheduled amortizations under the Bancomext Loan on such date;

 

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

 

(C)           the tenor of such Company Refinancing Indebtednesscannot be less than the tenor of the Bancomext Loan; and

 

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(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 equal to orgreater than the weighted average maturity of the Indebtedness being Refinanced,and

 

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

 

(iii)          such new Indebtedness isIndebtedness of such Subsidiary;

 

(iv)          if the Indebtedness beingRefinanced is Subordinated Indebtedness, then such new Indebtedness shall besubordinate to any senior Indebtedness at least to the same extent and in thesame manner as the Indebtedness being Refinanced;

 

(v)           such new Indebtedness is incurred pursuant to (i) termsand pricing that reflect market terms and pricing for such Subsidiary and (ii) termsthat are no less favorable to the Subsidiary than the terms and conditionshereunder;

 

(vi)          such new Indebtedness is secured using the samecollateral as, and to an extent no greater than, the Indebtedness beingRefinanced;

 

(vii)         such new Indebtedness, if guaranteed by the Company orany Subsidiary, is guaranteed by the same Persons as, and to an extent nogreater than, the Indebtedness being Refinanced; provided that thePermitted Bancomext Guaranty may not be extended or renewed; and

 

(viii)        all of the Net Cash Proceeds of such new Indebtednessare 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 meaning specified in Section 7.16(e) (*Limitations on Incurrence of Additional Indebtedness*).

 

“Perpetual Bonds” means the 7.75% PerpetualBonds issued by the Company.

 

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“Person” means any natural person, partnership,limited liability company, corporation, business trust, joint stock company,trust, unincorporated association, joint venture or Governmental Authority orother entity.

 

“Plan” means any “employee benefit plan” (assuch term is defined in Section 3(3) of ERISA) established by theCompany or any ERISA Affiliate.

 

“Pledged Entity Asset Sale” means any AssetSale by any Subsidiary in the Gimsa Division, the Gruma Corp. Division or theMolinera Division.

 

“Pledged Entity CasualtyEvent” means any Casualty Event affecting any Subsidiary in the GimsaDivision, the Gruma Corp. Division or the Molinera Division.

 

“Post-Default Rate”means a rate per annum equal to (x) the Alternate Base Rate plus theApplicable Margin or (y) LIBOR plus the Applicable Margin, as notified tothe Company by the Lender, in each case plus two percent (2%). Unless and until the Lender notifies the Company otherwise, thePost-Default Rate applicable to the Loan shall be LIBOR plus the ApplicableMargin 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 beforeany Governmental Authority.

 

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

 

“Prohibited Collateral Sale” means anyDisposition of the “Collateral”, as such term is used in the Major DerivativeCounterparty Loan.

 

“Property” means any asset, revenue or anyother property, whether tangible or intangible, including any right to receiveincome.

 

“Pro Rata Share” means, as of any date, withrespect to each Minor Derivative Counterparty, a fraction (expressed as adecimal, rounded to the second decimal place) the numerator of which is theoutstanding principal amount of the Loan of such Minor Derivative Counterpartyand the denominator of which is the aggregate principal amount of all MinorDerivative Counterparty Loans.

 

“Qualified Accountant” means any ofPriceWaterhouseCoopers, KPMG, Deloitte Touche Tohmatsu or Ernst and Young; providedthat, at any time, the auditor of the Company or any of its Subsidiaries shallnot be a Qualified Accountant.

 

“Qualified Counterparty”means a financial institution (a) based in a country that is a member ofthe OECD and (b) that has a credit rating of A- or higher from S&P or A3 orhigher 

 

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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 ComplianceCertificate” means a certificate substantially in the form of Exhibit B-1.

 

“Refinance” means, inrespect of any Indebtedness, to issue any Indebtedness in exchange for or torefinance, replace, defease or refund such Indebtedness in whole or inpart.  “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 respectto an Asset Sale, a certificate signed by a Senior Officer of the Companystating that within the relevant Reinvestment Period, up to 50% of the Net CashProceeds of such Asset Sale shall be used to make Restricted Investments.

 

“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, the periodof two hundred and seventy (270) days following the date on which such AssetSale was consummated.

 

“Reportable Event” means any of the events setforth in Section 4043(c) of ERISA, other than events for which thethirty (30)-day notice period has been waived.

 

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

 

“Reporting Indebtedness” means each of (a) theSecured Indebtedness, (b) the Bancomext Loan, (c) the MinorDerivative Counterparty Loans, and (d) any Indebtedness the proceeds ofwhich are applied to the Refinancing of the foregoing.

 

“Reporting Indebtedness Documentation” has themeaning specified in Section 4.01(m) (*Delivery of Reporting Indebtedness Documents*).

 

“Reporto Contract” means any ContractualObligation providing for (a) the sale to a third party counterparty by theCompany or its Subsidiaries of a negotiable warehouse receipt (*certificado de depósito*) or any similarinstrument representing corn or wheat stored in a warehouse and (b) thesubsequent repurchase of such negotiable warehouse receipt (*certificado de depósito*) or similarinstrument by the Company or such Subsidiary from such third party counterpartyfor the same price plus a premium previously agreed to by the parties.

 

“Required Payment Period” means, with respectto an Asset Sale or a Casualty Event, the period of (i) five (5) BusinessDays following the receipt of the Net Cash Proceeds thereof (or, if 

 

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applicable, following thelast day of the relevant Reinvestment Period) if such Net Cash Proceeds arereceived by the Company, or (ii) ten (10) Business Days following thereceipt of the Net Cash Proceeds thereof (or, if applicable, following the lastday of the relevant Reinvestment Period) if such Net Cash Proceeds are receivedby a Subsidiary of the Company.

 

“Required Repayment Date” means, with respectto an Asset Sale or Casualty Event, the last day of the relevant RequiredPayment Period.

 

“Requirement of Law” means, as to any Person,any law (statutory or common), treaty, rule or regulation or order,injunction, writ, decree or other determination of an arbitrator or a court orother Governmental Authority, including any Environmental Law, in each caseapplicable to or binding upon such Person or any of its property or to whichthe Person or any of its property is subject.

 

“Restore” means, with respect to any Propertyaffected by a Casualty Event, to rebuild, repair, restore or replace suchaffected Property.

 

“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 anyPerson:

 

(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 

 

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other ownership interestin, or of any option, warrant or other right to acquire any such shares ofcapital stock, partnership interest or other 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 anyarrangement pursuant to which a Person sells or transfers, directly orindirectly, any Property used or useful in its business, and thereafter suchPerson or an Affiliate of such Person rents or leases such Property or otherProperty from the purchaser or transferee (or their Affiliate) for the same orsimilar use in its business, or any similar transaction or arrangement.

 

“SAR” means the *Sistema de Ahorro para el Retiro*ofMexico.

 

“Secured Indebtedness” means the MajorDerivative Counterparty Loan, the BBVA Loan and the Perpetual Bonds.

 

“Senior Officer” means, with respect to anyPerson, the chief executive officer, the president, the general manager or thechief financial officer of such Person, or, in each case, any other officer ofsuch Person having substantially the same authority and responsibility.

 

“Shared Casualty Events Proceeds” means NetCash Proceeds of Casualty Events (other than Net Cash Proceeds from a CasualtyEvent received by any Subsidiary that is part of the Venezuelan Division, tothe extent such Subsidiary is prohibited by Venezuelan laws or regulations fromtransferring or paying such Net Cash Proceeds out of Venezuela).

 

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

 

“Shared Proceeds” means the (a) the SharedPermitted Prepayment Asset Sale Proceeds and (b) Shared Casualty EventsProceeds.

 

“Shared Proceeds Trigger” has the meaningspecified in Section 2.05(a)(ii) (*MandatoryPrepayments*).

 

“Solvent” means, with respect to any Person ona particular date, that on such date, (a) the present fair value of theproperty of such Person is greater than the total amount of debts andliabilities, subordinated, contingent or otherwise, of such Person, (b) suchPerson will be able to pay its debts and liabilities, subordinated, contingentor otherwise, 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 

 

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payment obligations *(incumplimiento generalizado en el pago de sus obligaciones)*within the meaning of Section I or II of Article 10 of the Mexican *Ley de Concursos Mercantiles*, and (e) none of theevents enumerated in Sections I through VII of Article 11 of the Mexican *Ley de Concursos Mercantiles* shall be in effect with respectto such Person.  The amount of contingentliabilities at any time shall be computed as the amount that, in the light ofall the facts and circumstances existing at such time, represents the amountthat could reasonably 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).

 

“SubordinatedIndebtedness” means, with respect to the Company or any of itsSubsidiaries, any Indebtedness of the Company or such Subsidiary, as the casemay be, which is pursuant to its terms expressly subordinated in right ofpayment to any senior Indebtedness.

 

“Subsidiary” of a Person means any corporation,partnership, joint venture, limited liability company, trust, estate or otherentity (a) of which more than 50% of the voting stock or otherequity interests (in the case of Persons other than corporations), is owned orControlled directly or indirectly by such Person, or one or more of theSubsidiaries 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 themeaning specified in Section 7.12(b) (*Fundamental Changes, Limitations on Asset Sales, Asset Exchanges andAcquisitions*).

 

“Taxes” means any and all present or futuretaxes, duties, levies, assessments, imposts, deductions, withholdings orsimilar charges, and all liabilities with respect thereto, including anyrelated interest or penalties, imposed by Mexico or any political subdivisionor taxing authority thereof or therein or by any jurisdiction from which theCompany shall make any payment (or from which any payment shall be made)hereunder or under any Loan Document.

 

“Temporary Accounts” means the Temporary LoanAccount and each account established for similar purpose by the Other MinorDerivative Counterparties and the Major Derivative Counterparties in the nameof the Company pursuant to the Other Minor Derivative Counterparty Loans andthe Major Derivative Counterparty Loan.

 

“Temporary Loan Account” has the meaningspecified in Section 2.03(b) (*Procedurefor Making of Loan*).

 

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“Terminated Derivative Obligation” means the$13,900,000 obligation (other than in respect of interest) of the Company toRBS arising out of the Confirmation, and as assumed by the Initial Lender.

 

“Total Indebtedness” means, on any date, theoutstanding principal balance of all Indebtedness of the Company and itsConsolidated Subsidiaries (excluding Venezuelan Non-Recourse Indebtedness).

 

“Trustee” means Banco Nacional deMéxico S.A., Integrante del Grupo Financiero Banamex, División Fiduciaria asthe trustee (*fiduciario*) pursuantto the Intercompany Trust Agreement.

 

“Unfunded Pension Liability” means the excessof a Pension Plan’s benefit liabilities under Section 4001(a)(16) ofERISA, over the current value of that Pension Plan’s assets, determined inaccordance with the assumptions used for funding the Pension Plan pursuant to Section 412of the Code for the applicable plan year.

 

“United States” and “US” each means theUnited States of America.

 

“Unused CapEx” means, in respect of any FiscalYear, the Permitted Capital Expenditures Amount (without giving effect to anycarry-over from any prior year) for such Fiscal Year less all CapitalExpenditures made during such Fiscal Year.

 

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

 

“US Dollar Equivalent” means, with respect toany non-US Dollar-denominated amount on any date, the amount of US Dollarsobtained by converting such non-US Dollar-denominated amount into US Dollarsusing the Conversion Rate on such date.

 

“US GAAP” means (i) generally acceptedaccounting principles in the United States or (ii) the international financial reporting standards set by the InternationalAccounting Standards Board or any successor thereto, to the extent that a Person organizedunder the laws of a jurisdiction of the United States would be permitted underthe applicable Requirements of Law to use such standards in financialstatements filed in reports 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.

 

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“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 givensuch term under Part I of Subtitle E of Title IV of ERISA.

 

“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.        OtherInterpretive 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.

 

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(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.

 

1.03.        AccountingPrinciples.

 

(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.

 

ARTICLEIITHE LOAN

 

2.01.        TheLoan.

 

(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*

 

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*Jurisdiction, Waiver of Jury Trial*), 9.16 (*Waiverof Immunity*) and 9.17 (*Payment inUS Dollars; Judgment Currency*) shall survive any terminationpursuant to this Section 2.01(c).

 

2.02.        Evidenceof 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 the Lender thatthe Note qualifies as a *pagaré*underMexican law.

 

(c)           In the event that anyconflict arises between the provisions of this Agreement and the terms of anyNote, 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.

 

2.03.        Procedurefor 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.        VoluntaryPrepayments.

 

(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 

 

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notice of prepaymentshall specify the date and amount of such prepayment (and, upon the datespecified in any such notice, the amount to be prepaid shall become due andpayable 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.        MandatoryPrepayments.

 

(a)           In each Fiscal Year:

 

(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 

 

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Disposition of any of theBanorte Shares) may be used for Investments in long-term productive assets usedin the Company’s Core Business during the Reinvestment Period for suchPermitted Prepayment Asset Sale; provided, further, that any suchamount of Shared Permitted Prepayment Asset Sale Proceeds used for Investmentsin long-term productive assets used in the Company’s Core Business shall not becounted against the thresholds in clauses (i) and (ii) above; provided,further, that if all or any portion of such Shared Permitted PrepaymentAsset Sale Proceeds is not ultimately applied to such Investments within theReinvestment Period pursuant to the preceding proviso, any remaining portion ofsuch Shared Permitted Prepayment Asset Sale Proceeds shall be applied to prepaythe Mandatory Prepayment Indebtedness or the Other Prepayment Indebtedness, asapplicable pursuant to the thresholds in clauses (i) and (ii) above,on the Required Repayment Date. Notwithstanding anything herein to the contrary, 100% of the Net CashProceeds of any Disposition of any of the Banorte Shares shall be applied tothe prepayment of the Mandatory Prepayment Indebtedness or the Other PrepaymentIndebtedness, as applicable pursuant to the thresholds in clauses (i) and (ii) above,within the applicable Required Payment Period, and none of the Net CashProceeds thereof may be used for Investments in long-term productive assets inthe Company’s Core Business or any purpose other than prepayment of theMandatory Prepayment Indebtedness or Other Prepayment Indebtedness, asapplicable.

 

(b)           In each Fiscal Year:

 

(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, 

 

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all (but no more thanUS$10,000,000 (or the US Dollar Equivalent thereof) without the written consentof the holders of more than 50% of the then aggregate outstanding principalamount of the Major Derivative Counteryparty Loan or US$55,000,000 (or the USDollar Equivalent thereof) in any event) of such Shared Casualty EventsProceeds from such Casualty Event may be used to Restore any such affectedProperties during the Reinvestment Period; provided, further, that any suchamount of Shared Casualty Events Proceeds from such Casualty Event used toRestore any such affected Properties shall not be counted against thethresholds in clauses (i) and (ii) above; provided, further, that ifall or any portion of such Shared Casualty Events Proceeds from such CasualtyEvent is not ultimately applied to Restore any affected Properties within theReinvestment Period pursuant to the preceding proviso, any remaining portion ofsuch Shared Casualty Events Proceeds from such Casualty Event shall be appliedto prepay the Mandatory Prepayment Indebtedness or the Other PrepaymentIndebtedness, as applicable pursuant to the thresholds in 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.

 

(d)           If the Company incurs any PermittedRefinancing Indebtedness with respectto any Other Prepayment Indebtedness (including any partial Refinancingsthereof), and such Permitted Refinancing 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 OtherPrepayment Indebtedness shall be made on a prorata basisaccording to the Other Prepayment Pro Rata Amounts for such Other PrepaymentIndebtedness.

 

(f)            Any mandatory prepayment of the Loansshall be paid in US Dollars and applied to all Minor Derivative CounterpartyLoans on a prorata basis according to each Minor DerivativeCounterparty’s Pro Rata Share.

 

2.06.        Repaymentof the Loan.

 

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

 

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| **Repayment Date**      | ** ** | **Amount** | ** ** |
|-------------------------|------------|------------|------------|
| August 21, 2010    |       | US$        | 579,166.67 |   |
| September 21, 2010 |       | US$        | 579,166.67 |   |
| October 21, 2010   |       | US$        | 579,166.67 |   |
| November 21, 2010  |       | US$        | 579,166.67 |   |
| December 21, 2010  |       | US$        | 579,166.67 |   |
| January 21, 2011   |       | US$        | 579,166.67 |   |
| February 21, 2011  |       | US$        | 579,166.67 |   |
| March 21, 2011     |       | US$        | 579,166.67 |   |
| April 21, 2011     |       | US$        | 579,166.67 |   |
| May 21, 2011       |       | US$        | 579,166.67 |   |
| June 21, 2011      |       | US$        | 579,166.67 |   |
| July 21, 2011      |       | US$        | 579,166.67 |   |
| August 21, 2011    |       | US$        | 579,166.67 |   |
| September 21, 2011 |       | US$        | 579,166.67 |   |
| October 21, 2011   |       | US$        | 579,166.67 |   |
| November 21, 2011  |       | US$        | 579,166.67 |   |
| December 21, 2011  |       | US$        | 579,166.67 |   |
| January 21, 2012   |       | US$        | 579,166.67 |   |
| February 21, 2012  |       | US$        | 579,166.67 |   |
| March 21, 2012     |       | US$        | 579,166.67 |   |
| April 21, 2012     |       | US$        | 579,166.67 |   |
| May 21, 2012       |       | US$        | 579,166.67 |   |
| June 21, 2012      |       | US$        | 579,166.67 |   |
| July 21, 2012      |       | US$        | 579,166.67 |   |

 

provided that thefinal installment payable by the Company on the Maturity Date shall be in anamount, if such amount is different from that specified above, sufficient torepay the aggregate principal amount of the Loan outstanding on the MaturityDate.

 

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.

 

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(b)           Interest on the Loan shall be paid inarrears on each Interest Payment Date. Interest shall also be paid on the date of any prepayment of the Loanunder Section 2.04 (*VoluntaryPrepayments)* and Section 2.05 (*MandatoryPrepayments*) with respect to the portion of the Loan so prepaid, andupon payment (including prepayment) in full of the Loan.  During the existence of any Event of Default,interest shall be payable on demand.

 

(c)           Upon the occurrence and during thecontinuation of an Event of Default, any amounts outstanding under the Loan(including any overdue principal and, to the extent permitted by applicablelaw, overdue interest or other amount payable hereunder) shall bear interestpayable on demand, for each day from the date payment thereof was due to thedate of actual payment, at a rate per annum equal to the Post-Default Rate.

 

2.08.        Computationof Interest and Fees.

 

(a)           Computation of the Alternate Base Rate,when the Alternate Base Rate is determined based on the Lender’s prime rate,shall be calculated on the basis of a year of three hundred sixty-five (365) orthree hundred sixty-six (366) days, as the case may be, and the actual numberof days elapsed (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 on the basis of ayear of three hundred sixty (360) days and the actual number of days elapsed(including the first day but excluding the last day).

 

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

 

2.09.        Paymentsby 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,counterclaim or other defense.  Except asotherwise expressly provided herein, all payments by the Company shall be madeto the Lender at the Lender’s Payment Office, and shall be made in US Dollarsin immediately available funds, no later than 11:00 A.M. (New York Citytime) 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 inthe definition of “Interest Period” herein, whenever any payment is due on aday other than a Business Day, such payment shall be made on the followingBusiness Day, and such extension of time shall in such case be included in thecomputation of interest.

 

2.10.        Promiseto Pay.  The Company agrees to pay the principalamount of the Loan in installments on the dates and in the amounts set forth inSection 2.06 (*Repayment of the Loans*)with a final installment on the Maturity Date, and further agrees to pay allunpaid interest accrued thereon, in accordance with the terms of this Agreementand the Note.

 

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ARTICLEIIITAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01.        Taxes.

 

(a)           Any and all payments by the Company to orfor the account of the Lender pursuant to this Agreement and any other LoanDocument shall be made free and clear of, and without deduction or withholdingfor, any Indemnified Taxes or Other Taxes except to the extent such deductionor withholding is required by applicable law.

 

(b)           In addition, the Company shall pay allOther Taxes to the relevant Governmental Authority in accordance withapplicable law.

 

(c)           If the Company shall be required by lawto deduct or withhold any Indemnified Taxes or Other Taxes from or in respectof any sum payable 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 retains an amount equalto the sum it would have received and retained had no such deductions orwithholdings been made;

 

(ii)                   the Company shall make such deductionsand withholdings;

 

(iii)                  the Company shall pay the full amountdeducted or withheld to the relevant Governmental Authority in accordance withapplicable 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, alladditional amounts that the Lender specifies as necessary to preserve theafter-tax yield the Lender would have received if such Indemnified Taxes orOther Taxes had not been 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 thelast paragraph of Section 3.01(c) above, the Company agrees toindemnify and hold harmless the Lender for the full amount of (i) IndemnifiedTaxes and (ii) Other Taxes (including deductions and withholdingsapplicable to additional sums payable under this Section 3.01) in theamount 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, and any liability (including penalties, interest, additions totax and expenses) arising therefrom or with respect thereto, whether or notsuch Indemnified Taxes or Other Taxes were correctly or legally asserted.

 

(e)           Within thirty (30) days after the date ofany payment by the Company of Indemnified Taxes or Other Taxes, the Companyshall furnish to the Lender the original or a

 

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certified copy of a receipt evidencing payment thereofor other evidence satisfactory to the Lender.

 

(f)                                    The Lender shall, at or before the timeit becomes a Lender hereunder and otherwise, if reasonably requested by theCompany, promptly furnish to the Company such forms, documents or otherinformation as may be required by the Mexican tax law applicable at such timeand which such Lender is eligible to provide under applicable law, in order toallow the Company to make the corresponding gross up payments to such Lenderand to establish 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 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 Taxesand not be entitled 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 anyRequirement of Law has made it unlawful, or that any Governmental Authority hasasserted that it is unlawful, for the Lender or its applicable Lending Officeto make or maintain 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 anyRequirement of Law has made it unlawful, or that any Governmental Authority hasasserted that it is unlawful or restricts the authority of the 

 

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Lender to purchase or sell, or to take deposits of, USDollars in the London interbank market, or to determine or charge interestrates based upon LIBOR (and, in the reasonable opinion of the Lender, thedesignation of a different applicable Lending Office would either not avoidsuch unlawfulness or would be disadvantageous to the Lender), then, on noticethereof by the Lender to the Company, the Lender shall be an Affected Lenderand 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, anotice to the Company by the Lender shall be effective, if lawful, on the lastday of the Interest Period currently applicable to the Loan; in all other casessuch notice shall be effective on the date of receipt by the Company.

 

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 does notadequately and fairly reflect the cost to the Lender of making or maintainingthe 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 to either (i) the introduction of, or any change in, or any change inthe interpretation 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 

 

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a consequence of its Loan or obligations under thisAgreement, then, upon demand of the Lender to the Company, the Company shallpay to the Lender, from time to time as specified by the Lender, additionalamounts sufficient to compensate the Lender for such increase.

 

3.05.                        Funding Losses.

 

(a)                                  The Company shall reimburse the Lenderand hold the Lender harmless from (in each case by prompt payment of anyrelevant amounts to the Lender) any loss, cost or expense that the Lender maysustain or incur, including any loss incurred in obtaining, liquidating orredeploying deposits bearing interest by reference to LIBOR from third parties(“Funding Losses”) as a consequence of any of the following events (eacha “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;

 

(iii)                                                       the failure of the Company to make anyvoluntary prepayment in accordance with any notice delivered under Section 2.04(*Voluntary Prepayments*) ormandatory prepayment 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 bedeemed to include an amount determined by the Lender to be the excess, if any,of (i) the amount of interest that would have accrued on the principalamount of the Loan had 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”),

 

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additional interest on the unpaid principal amount ofthe Loan equal to the actual costs of such reserves allocated to the Loan bythe Lender (as determined by the Lender in good faith, which determinationshall be conclusive, absent manifest error), payable on each date on whichinterest is payable on the Loan, provided that the Company shall havereceived at least fifteen (15) days’ prior written notice of such additionalinterest from the Lender.  If the Lenderfails to give notice fifteen (15) days prior to the relevant Interest PaymentDate, such additional interest shall be payable fifteen (15) days from receiptof such notice.

 

3.07.                        Certificates of the Lender.

 

(a)                                  Except as otherwise specified herein, theLender claiming 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.

 

(b)                                 The Lender agrees to notify the Companyof any claim for reimbursement pursuant to Section 3.04 (*Increased Costs and Reduction of Return*)or 3.06 (*Reserves on Loan*) notlater than one hundred eighty (180) days after any officer of the Lenderresponsible for the administration of this Agreement receives actual knowledgeof the event giving rise to such claim. If the Lender fails to give such notice, the Company shall only berequired to reimburse or compensate the Lender, retroactively, for claimspertaining to the period of one hundred eighty (180) days immediately precedingthe date the claim was made.  However, ifthe change in a Requirement of Law (including any Capital Adequacy Regulation)giving rise to such increased cost or reduction is retroactive, then the onehundred eighty (180)-day period referred to above will be extended to includethe period of retroactive 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 thereceipt by 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 

 

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replaced or removed hereunder until the Lender hasbeen repaid in full all amounts owed to it pursuant to this Agreement and theother Loan Documents (including Section 2.08 (*Computation of Interest and Fees*), Section 3.01 (*Taxes*), Section 3.04 (*Increased Costs and Reduction of Return*), Section 3.05(*Funding Losses*) and Section 3.06(*Reserves on Loan*)) unless anysuch amount is 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.

 

ARTICLEIVCONDITIONS 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:

 

(a)                                  Loan Agreement and Note. This Agreement,each other Loan Document and the Intercompany Revolving Facilities shall have been duly executed by both of theparties hereto and thereto, the Note dated on the Closing Date shall have beenduly executed by the Company, and the Initial Lender shall have received fromthe Company a counterpart of this Agreement and each other Loan Document andIntercompany Revolving Facility, the Initial Lender’s Note and all relateddocumentation each in form and substance satisfactory to the Initial Lender andsigned by the Company.

 

(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 issuenegotiable instruments (*títulos de crédito*);and

 

(iii)                                                       a certificate of the Secretary orAssistant Secretary of the Company (x) certifying the names and truesignatures of the Senior Officers of the Company authorized to execute anddeliver this Agreement, all other Loan Documents and the Intercompany RevolvingFacilities to be delivered by the Company and the Intercompany 

 

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Lenders hereunderand (y) attaching copies of all documents evidencing all necessarycorporate action (including anynecessary resolutions of the Board of Directors or of the shareholders of theCompany or IntercompanyLender) and governmental approvals, if any, with respect tothe authorization for the execution, delivery and performance of each such LoanDocument and the transactions contemplated hereby and thereby, whichcertificates shall state that the resolutions or other information referred toin such certificates have not been amended, modified, revoked or rescinded asof the date of such certificates.

 

(c)                                  Authorizations. The Initial Lender shall have received evidence satisfactory to it thatall approvals, authorizations or consents of, or notices to, or filings orregistrations with, any Governmental Authority (including exchange controlapprovals) or third parties, if any, required in connection with the execution,delivery and performance 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 necessary, the Initial Lender shall havereceived a certificate executed by a Senior Officer of the Company so stating.

 

(d)                                 Process Agent. The Initial Lender shall have received (i) copies of irrevocablepowers of attorney for lawsuits and collections (*poder irrevocable para pleitos y cobranzas*) granted by theCompany, certified by a Mexican notary public, in form reasonably satisfactoryto the Initial 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 Initial Lender shall have received (i) an opinion of Mijares,Angoita, Cortés y Fuentes, special Mexican counsel to the Company,substantially in the form of Exhibit D; (ii) an opinion ofMilbank, Tweed, Hadley & McCloy LLP, special New York counsel to theCompany, substantially in the form of Exhibit E-1; (iii) anopinion of Salvador Vargas Guajardo, General Counsel to the Company,substantially in the form of Exhibit E-2; (iv) a favorableopinion of White & Case S.C., special Mexican counsel to the InitialLender; and (v) a favorable opinion of CGSH, specialNew York counsel to the Initial Lender.

 

(f)                                    Payment of Fees.  The Initial Lender shall have received evidence of payment of the feesand expenses then due 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.

 

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(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 thedate of the audited financial statements of the Company and its ConsolidatedSubsidiaries described in clause (o) below, a Material Adverse Effect,except as otherwise disclosed in the Company’s public filings with the USSecurities and Exchange Commission or the Comisión Nacional Bancaria y deValores prior to the date hereof and listed on Schedule 5.06(c) (*ExistingMaterial Adverse Effects*).

 

(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 acertificate signed by the chief financial officer and one additional SeniorOfficer of the Company, dated as of the Closing Date, to the effect that, bothbefore and after giving effect to the transactions contemplated by the LoanDocuments and the Intercompany Revolving Facilities, each of theconditions precedent in clauses (i) through (vi) above are true andcorrect

 

(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, and including, August 21, 2009, (ii) 2.875% perannum, from and including August 22, 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 Company shall have entered into the Control Agreement with theInitial Lender and the bank where the Temporary Loan Account for the InitialLender is located, on terms and conditions satisfactory to the Initial Lender.

 

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(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.

 

(k)                                  Legal Matters. No Requirement of Law, shall in the reasonable judgment of the InitialLender, 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 IndebtednessDocuments.  The Company shall have provided the InitialLender with copies of all Contractual Obligations for all of the ReportingIndebtedness (suchContractual Obligations, the “Reporting Indebtedness Documentation”).

 

(n)                                 No Litigation. There shall be 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 itself and as requested by the Initial Lender) any documents orinformation reasonably required to obtain, verify and record 

 

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information that identifies the Company and itsSubsidiaries, which information may include (but shall not be limited to) thename and address of the Company and its Subsidiaries and any other informationthat will allow such the Initial Lender to identify the Company and itsSubsidiaries 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.

 

(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 Initial Lender shall have received such other certificates, powersof attorney, approvals, opinions, documents or materials as the Initial Lendermay reasonably request.

 

ARTICLEVREPRESENTATIONS 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 andvalidly existing under the laws of the jurisdiction of its organization and, tothe extent applicable under the laws of its jurisdiction of organization, is ingood standing;

 

(b)                                 is qualified to do business in everyjurisdiction where such qualification is required, except where the failure tobe qualified has not had and could not reasonably be expected to have aMaterial Adverse Effect;

 

(c)                                  has all requisite corporate power andauthority and all requisite governmental licenses, authorizations, consents andapprovals to (i) conduct its business as now conducted and as proposed tobe conducted and to own its Properties, except to the extent that the failureto obtain any such governmental license, authorization, consent or approval hasnot had and could not reasonably be expected to have a Material Adverse Effect,and (ii) execute, deliver and perform all of its obligations under each ofthe Loan Documents andthe Intercompany Revolving Facilities andeach other agreement or instrument contemplated thereby to which it is or willbe a party and receive the Loan hereunder; and

 

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(d)                                 is in compliance with all Requirements ofLaw, except to the extent that the failure to comply therewith has not had andcould not reasonably 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 orany of its Subsidiaries’ Organizational Documents; or

 

(b)                                 conflict or be inconsistent with orresult in any breach, violation or contravention of (alone or with notice orthe lapse of time or both), or the creation of any Lien under, or give rise to any right to accelerate or torequire the prepayment, repurchase or redemption of any obligation under orconstitute a default in respect of (i) any document evidencing any Contractual Obligationto which the Company or any of its Subsidiaries is a party or (ii) anyRequirement of Law to which the Company or any of its Subsidiaries or theirrespective 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 affectthe legality, validity or enforceability of this Agreement or any other LoanDocument, or any of the transactions contemplated hereby or thereby; or

 

(b)                                 could reasonably be expected to have amaterial adverse effect on the ability of the Company to perform itsobligations under any Loan Document; or

 

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(c)                                  that, in the aggregate, could reasonablybe expected to have a Material Adverse Effect

 

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

 

(a)                                  The Company’s audited consolidatedfinancial statements for the Fiscal Year ended December 31, 2008 (copiesof which have been furnished to the Lender) (i) are complete and correctin all material respects, (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 FiscalYear ended December 31, 2008, and (iii) have been audited andcertified by independent certified public accountants of internationalstanding.

 

(b)                                 The Company’s unaudited financialstatements for each of the Fiscal Quarters ended March 31, 2009 and June 30,2009 (copies of which have been furnished to the Lender) (i) are completeand correct in all material respects and (ii) have been prepared inaccordance with Mexican GAAP applied on a consistent basis and fairly presentin accordance with Mexican GAAP the financial condition of the Company and itsConsolidated Subsidiaries as of such date and the results of their operationsfor the period covered thereby, subject to the absence of footnotes and tonormal year-end audit adjustments.

 

(c)                                  Since the date of the most recent auditedfinancial statements, there has occurred no development, event or circumstancewhich has had or could reasonably be expected to have a Material AdverseEffect, except as otherwise disclosed in the Company’s public filings with theUS Securities and Exchange Commission or the Comisión Nacional Bancaria y deValores**and listed on Schedule5.06(c) *(Existing Material AdverseEffects)*.

 

(d)                                 As of the Closing Date, neither theCompany nor any of its Subsidiaries is in default under or with respect to anyContractual Obligation in any respect which has had or could reasonably beexpected to have a Material Adverse Effect, or that would, if such default hadoccurred after the 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 to

 

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be filed, and have timely paid all taxes, assessments,fees and other governmental charges levied or imposed upon them or theirProperties, including related interest and penalties, otherwise due andpayable, except (a) those which are 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) and (b) those taxreturns or taxes for which such failure to timely file or timely pay (as thecase may be) could not reasonably be expected to have a material adverse effecton the business, financial condition or operations of the Company or suchSubsidiary.

 

5.09.                        Environmental Matters.

 

(a)                                  The on-going operations of the Companyand each of its Subsidiaries are, and during the past five (5) years havebeen, in compliance in all material respects with all applicable EnvironmentalLaws except as set forth on Schedule 5.09 (*EnvironmentalMatters*) or except to the extent that the failure to complytherewith has not had and could not reasonably be expected to have a MaterialAdverse Effect;

 

(b)                                 The Company and each of its Subsidiarieshave obtained all material environmental, health and safety permits necessaryor required for its operations, all such permits are in good standing, and theCompany and each of its Subsidiaries is and has been in compliance in allmaterial respects with all applicable terms and conditions of such permits,except as set forth on Schedule 5.09 (*EnvironmentalMatters*) or except to the extent that the failure to obtain, andmaintain in full force and effect, any such permit, or to the extent thatfailure to comply with the material terms thereof, has not had and could notreasonably be expected to have a Material Adverse Effect;

 

(c)                                  Neither the Company nor any of itsSubsidiaries is conducting, or to the best knowledge of the Company afterreasonable investigation, is required to conduct, any investigations orremediation of hazardous substances under any applicable Environmental Law atany property currently or formerly owned or operated by the Company or anySubsidiary (including soils, groundwater, surface water, buildings or otherstructures) except as set forth on Schedule 5.09 (*Environmental Matters*) or except as has not had and couldnot reasonably be expected to have a Material Adverse Effect; and

 

(d)                                 Neither the Company nor any of itsSubsidiaries has received any notice, demand, letter, claim or request forinformation indicating that it may be in violation of or subject to liabilityunder any Environmental Law, including any liability for any release of anyhazardous substance on any third party property, or is subject to any order,decree, injunction or other arrangement with any Governmental Authorityrelating to any Environmental 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.

 

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

 

(a)                                  The Company and each of its MaterialSubsidiaries has good and marketable title to, or valid leasehold interests in,all Property that is reasonably necessary to, or used in the ordinary conductof, or is otherwise material to its business, and has no knowledge of anypending or contemplated 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 MaterialSubsidiaries own or are licensed or otherwise have the right to use all of thematerial trademarks, trade names, copyrights, patents, contractual franchises,licenses, authorizations, other intellectual property and other rights that arereasonably necessary for the operation of their respective business, withoutconflict with the rights of any other Person except as the foregoing may notreasonably be expected to have a Material Adverse Effect.

 

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

 

(d)                                 Neither the Company nor any of itsSubsidiaries are party to any Sale Lease-Back Transactions except as set forthin Schedule 5.11(d) (*Existing SaleLease-Back Transactions*) (the “Existing Sale Lease-BackTransactions”).

 

(e)                                  The Company and each of its MaterialSubsidiaries have insurance with financially sound, responsible and reputableinsurance companies in such amounts and covering such risks as are usuallycarried by companies of good repute engaged in similar businesses and owningand/or operating properties similar to those owned and/or operated by theCompany or such Subsidiary, as the case may be, in the same general areas inwhich the Company or such Subsidiary owns and/or operates its properties, inaccordance with normal industry practice.

 

5.12.                        Subsidiaries.

 

(a)                                  A complete and correct list of allSubsidiaries of the Company, showing the correct name thereof, the jurisdictionof its incorporation and the percentage of shares of each class of capitalstock outstanding owned by the Company and each Subsidiary of the Company isset forth 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 theirterms, expressly prohibit or limit the payment of dividends or otherdistributions to the Company by a Subsidiary or the making of loans to theCompany by a Subsidiary 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 

 

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execution and performance of the Loan Documents by theCompany constitute private and commercial acts and not governmental or publicacts.  The Company and its Property issubject to legal action in respect of its Obligations and is not entitled to immunityon the grounds of sovereignty or otherwise from the jurisdiction of any courtor from any legal process (whether through service or notice, attachment priorto judgment, attachment in aid of execution, execution or otherwise) inconnection therewith.  If the Company orany of its Property should become entitled to any such right of immunity, theCompany 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 Requirements of Law.  To ensure thelegality, validity, enforceability or admissibility into evidence of the LoanDocuments, it is not necessary that any of such Loan Documents or any otherdocument be filed or recorded with any applicable Governmental Authority orthat any stamp or similar tax be paid on or in respect of any Loan Document.  Any judgment against the Company of a stateor United States federal court in the State of New York, United States arisingfrom, related to or in connection with any Loan Document is capable of beingenforced in the courts of Mexico; provided that in the event any legalProceedings are brought in the courts of Mexico, a Spanish translation of thedocuments, including this Agreement, prepared by a court-approved translatorwould be required in such Proceedings. It is not necessary in order for the Lender to enforce any rights orremedies under the Loan Documents, or solely by reason of the execution,delivery and performance by the Company of the Loan Documents, that the Lenderbe licensed or qualified with any Mexican Governmental Authority or be entitledto 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 to stateany material fact necessary to make the statements therein, in light of thecircumstances in which they were made, not misleading on the date on which suchinformation was furnished.  All writtenforward-looking information heretofore furnished in writing to the Lender hasbeen prepared by the Company or its Subsidiaries in good faith based uponassumptions 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.

 

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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.

 

5.18.                        ERISA Compliance; Labor Matters.

 

(a)                                  Each Plan is in compliance in allmaterial respects with the applicable provisions of ERISA, the Code and otherfederal or state laws and the regulations and published interpretationsthereunder.  Each Plan that is intendedto qualify under Section 401(a) of the Code has received a favorabledetermination letter from the IRS or an application for such a letter iscurrently being processed by the IRS with respect thereto and, to the bestknowledge of the Company, nothing has occurred which would prevent, or causethe loss of, such qualification.  TheCompany and each ERISA Affiliate have made all required contributions to eachPlan subject to Section 412 of the Code, and no application for a fundingwaiver or an extension of any amortization period pursuant to Section 412of the Code has been made with respect to any Plan.

 

(b)                                 There are no pending or, to the bestknowledge of the Company, threatened claims, actions or lawsuits, or action byany Governmental Authority, with respect to any Plan that could be reasonablyexpected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciaryresponsibility rules with respect to any Plan that has resulted or couldbe reasonably expected to result in a Material Adverse Effect.

 

(c)                                  (i) No ERISA Event has occurred, orto the best knowledge of the Company, is reasonably expected to occur and nocondition or event currently exists or is reasonably expected to occur thatcould result in an ERISA Event; (ii) no Pension Plan has any UnfundedPension Liability; (iii) neither the Company nor any ERISA Affiliate hasincurred, or reasonably expects to incur, any liability under Title IV of ERISAwith respect to any Pension Plan (other than premiums due and not delinquentunder Section 4007 of ERISA; (iv) no event, condition or amendmenthas occurred, is planned or is reasonably expected to occur which could requirethe Company or any ERISA Affiliate to post security with respect to any Planand no such event, condition or amendment is planned or is reasonably expectedto occur; (v) no Pension Plan has failed to satisfy the minimum fundingstandard, whether or not waived, under Section 302 of ERISA or Section 412of the Code; (vi) the Company and each ERISA Affiliate has made allcontributions required to be made by such person to each Plan as and when suchcontributions have become due; (vii) neither the Company nor any ERISAAffiliate is required to file with the PBGC the information required under Section 4010of ERISA with respect to any Pension Plan; (viii) neither the Company norany ERISA Affiliate has incurred, or reasonably expects to incur, any liability(and no event has occurred which, with the giving of notice, under Section 4219of ERISA, would result in such liability) under Section 4201 or 4243 ofERISA with respect to a Multiemployer Plan; (ix) no Multiemployer Plan isin “endangered” or “critical” status within 

 

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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.

 

(d)                                 Each Foreign Pension Plan is incompliance in all material respects with all requirements of law applicablethereto and the respective requirements of the governing documents for suchplan. With respect to each Foreign Pension Plan, none of the Company or itsSubsidiaries or any of their respective directors, officers, employees oragents has engaged in a transaction which would subject the Company or anySubsidiary, directly or indirectly, to a tax or civil penalty which couldreasonably be expected to result in a Material Adverse Effect. With respect toeach Foreign Pension Plan, reserves have been established in the financialstatements furnished to the Lender to the extent required by Section 6.01(*Financial Statements and Other Information*)in respect of any unfunded liabilities in accordance with all Requirements ofLaw or, where required, in accordance with ordinary accounting practices in thejurisdiction in which such Foreign Pension Plan is maintained. The aggregateunfunded liabilities with respect to such Foreign Pension Plans could notreasonably be expected to result in a Material Adverse Effect; the presentvalue of the aggregate accumulated benefit liabilities of all such ForeignPension Plans (based on those assumptions used to fund each such ForeignPension Plan) did not, as of the last annual valuation date applicable thereto,exceed by more than US$20,000,000 the fair market value of the assets of allsuch Foreign Pension Plans.

 

(e)                                  None of the Company or any of itsSubsidiaries are a party to any labor dispute that could reasonably be expectedto have a Material Adverse Effect, and there are no strikes, walkouts, lockoutsor slowdowns against the Company or its Subsidiaries pending or, to the bestknowledge of the Company or its Subsidiaries, threatened, except as would notbe expected to have a material adverse effect on the business, financialcondition or operations of the Company or such Subsidiary.  There is no unfair labor practice complaintpending against any of the Company or its Subsidiaries or, to the bestknowledge of any of the Company or its Subsidiaries, threatened against any ofthem that could reasonably be expected to have a Material Adverse Effect.  There is no grievance or significantarbitration Proceeding arising out of or under any collective bargainingagreement pending against any of the Company or its Subsidiaries or, to thebest knowledge of any of the Company or its Subsidiaries, threatened againstany of them, in each case that could reasonably be expected to have a MaterialAdverse Effect.

 

5.19.                        Anti-Terrorism Laws.

 

(a)                                  Neither the Company nor any of itsAffiliates is in violation of any laws relating to terrorism or money laundering(“Anti-Terrorism Laws”), including Executive Order No.  

 

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13224 on Terrorist Financing, effective September 24,2001 (the “Executive Order”), and the Uniting and Strengthening Americaby Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Actof 2001, Public Law 107-56 (the “Patriot Act”).

 

(b)                                 Neither the Company nor any of itsAffiliates acting or benefiting in any capacity in connection with the Loan isany of the following:

 

(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;

 

(iii)                                                       a Person or entity with which the Lenderis prohibited from dealing or otherwise engaging in any transaction by anyAnti-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 theCompany’s Affiliates 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.

 

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(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 Valuesset forth 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.

 

(e)                                  Each of the Reporting IndebtednessDocumentation is a true and correct copy of such Contractual Obligation, and (i) theCompany has not entered into any Contractual Obligations in respect of theReporting Indebtedness****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 financialstatements of the 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****has beenapproved 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 thanthe Secured Indebtedness is secured by a Lien on any Property of the Company orits Subsidiaries.

 

(b)                                 No Indebtedness of the Company isguaranteed by the Company’s Subsidiaries.

 

ARTICLEVIAFFIRMATIVE COVENANTS

 

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

 

6.01.                        Financial Statements and Other Information.

 

(a)                                  The Company will deliver to the Lender:

 

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(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 Material OperatingSubsidiary 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 equity and changes infinancial position prepared in accordance with Mexican GAAP (or US GAAP in thecase of Gruma Corp.) consistently applied (except as otherwise discussed in thenotes to such financial statements), which financial statements shall presentfairly, in accordance with Mexican GAAP (or US GAAP in the case of GrumaCorp.), the financial condition of the relevant Reporting Entity as at the endof the relevant Fiscal Year and the results of the operations of such ReportingEntity 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 for suchFiscal 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.

 

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(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;

 

(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*) andother Restricted 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 thefinancial statements for a Fiscal Year pursuant to clause (a)(i) above, acertificate signed by the independent accountants that have audited thefinancial statements described in clause (a)(i) above, stating whether duringthe course of their examination of such financial statements they obtainedknowledge of any Default under Section 7.09 (*Interest Coverage Ratio*) or Section 7.10 

 

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(*Leverage Ratio*) (which certificate may belimited to the extent required by accounting 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;

 

(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 to theCompany by the counterparties to such Hedging Agreements after reasonablerequest.

 

(f)                                    The Company will deliver to the Lender,promptly after the furnishing thereof, copies of any statement, report,proposed amendment or request for waiver, or any other similar notice furnishedto any holder of Reporting Indebtedness and not otherwise required to befurnished to the Lender pursuant to this Section 6.01 or Section 6.02(*Notice of Other Events*).

 

(g)                                 The Company will furnish to the Lender,promptly upon request of the Lender, such additional information regarding thebusiness, financial or corporate affairs of the Company and its Subsidiaries asthe Lender may reasonably request including for know-your-customer andanti-money laundering rules and regulations, including the Patriot Act.

 

(h)                                 The Company will furnish to the Lenderupon request a complete copy of the annual report (Form 5500) of each Planof the Company or any ERISA Affiliate required to be filed with the InternalRevenue Service.

 

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(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)                                  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,the listing of the Reporto Contracts, specifying the parties thereto andoutstanding principal amounts thereof, current as of the last day of theimmediately 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 ofDefault, signed by a Senior Officer of the Company, describing such Default orEvent of Default and the steps that the Company proposes to take in connectiontherewith;

 

(b)                                 notice of any litigation, claim, actionor Proceeding pending or threatened in writing before any GovernmentalAuthority (i) against the Company or any of its Subsidiaries, in whichthere is a probability of success by the plaintiff on the merits and which, ifdetermined adversely to the Company or such Subsidiary could be reasonablyexpected to have a Material Adverse Effect, (ii) which could reasonably beexpected to result in liability of the Company and its Subsidiaries in anaggregate amount exceeding US$20,000,000 (or the US DollarEquivalent thereof)or (iii) relating to this Agreement or any ofthe other Loan Documents or the Intercompany Revolving Facilities or the transactionscontemplated 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 ERISAEvent that, alone or together with any other ERISA Events that have occurred,could reasonably 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 madeto the Secretary of the Treasury for a waiver or modification of the minimumfunding standard (including any required installment payments) or an extensionof any amortization period under Section 412 of the Code with respect to aPension Plan;

 

(f)                                    notice that a material contributionrequired to be made to a Pension Plan by the Company or any ERISA Affiliate hasnot been timely made;

 

(g)                                 notice that a Pension Plan has failed tomeet minimum funding standards to a level sufficient to give rise to a lienunder ERISA or the Code;

 

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(h)           noticethat a proceeding has been instituted pursuant to Section 515 of ERISA tocollect a material delinquent contribution to a Multiemployer Plan;

 

(i)            noticethat the Company or any ERISA Affiliate is required to file with the PBGC theinformation required under Section 4010 with respect to any Pension Plan;and

 

(j)            noticeof any other event or development of which the Company obtains knowledge thathas had or could reasonably be expected to have a Material Adverse Effect.

 

6.03.        Maintenanceof Existence; Conduct of Business.

 

(a)           TheCompany will, and will cause each of its Subsidiaries to: (i) maintain ineffect its corporate existence and all registrations necessary therefor; (ii) takeall necessary actions to maintain all rights, privileges, titles to property,franchises and the like, necessary or desirable in the normal conduct of itsbusiness (as now conducted and as proposed to be conducted), activities oroperations; and (iii) maintain and preserve all of its Property and keepsuch Property in good working order or condition; provided, however,that this covenant shall not prohibit any transaction by the Company or any ofits Subsidiaries otherwise permitted under Section 7.03 (*Mergers, Consolidations, Sales and Leases*),nor shall it require any Subsidiary (other than a Material Subsidiary) tomaintain any such right, privilege, title to property or franchise or theCompany to preserve the corporate existence of any Subsidiary (other than aMaterial Subsidiary) if the Company shall determine in good faith that themaintenance or preservation thereof is no longer desirable in the conduct ofthe business of the Company or its Subsidiaries and that the loss thereof couldnot reasonably be expected to have a Material Adverse Effect.

 

(b)           TheCompany will, and will cause each of its Material Subsidiaries to, continue toengage only in the Company’s Core Business.

 

6.04.        Insurance.  The Company will, and will cause each of itsSubsidiaries to, maintain, and pay all premiums with respect to, insurance withfinancially sound, responsible and reputable insurance companies in suchamounts and covering such risks as are usually carried by companies of goodrepute engaged in similar businesses and owning and/or operating propertiessimilar to those owned and/or operated by the Company or such Subsidiary, asthe case may be, in the same general areas in which the Company or suchSubsidiary owns and/or operates its properties, in accordance with normalindustry practice; provided that the Company and its Subsidiaries shallnot be required to maintain such insurance for damaged, obsolete or worn-out equipment or other Property that is nolonger used in or useful to the business or if the failure to maintainsuch insurance could not reasonably be expected to have a Material AdverseEffect.

 

6.05.        Maintenanceof Governmental Approvals.  TheCompany will, and will cause each of its Material Subsidiaries to, maintain infull force and effect all governmental approvals (including any exchangecontrol 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 

 

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Loan Documents or the Intercompany Revolving Facilities andfor the validity or enforceability hereof. The Company will, and, if applicable, will cause each of itsSubsidiaries to, file all applications necessary for, and shall use itsreasonable best efforts to obtain, any additional authorization as soon aspossible after determination that such authorization or approval is requiredfor the Company or Subsidiary, as applicable, to perform its obligations underthis Agreement or any of the other Loan Documents or the Intercompany Revolving Facilities.

 

6.06.        Useof Proceeds.  The Company will usethe proceeds of the Loan to repay the Terminated Derivative Obligation on theClosing Date.

 

6.07.        Paymentof Obligations.  The Company will,and will cause each of its Subsidiaries to, pay all taxes, assessments andother governmental charges imposed upon it or any of its Property in respect ofany of its franchises, businesses, income or profits before any penalty orinterest accrues thereon, and pay promptly all Indebtedness and otherobligations or claims (including claims for labor, services, materials andsupplies) for sums that have become due and payable in accordance with theirterms and that by law have or might become a Lien upon its Property, except (a) ifthe failure to make such payment has not had and would not reasonably beexpected to have a Material Adverse Effect or (b) if such charge or claimis being contested in good faith by appropriate provision promptly initiatedand diligently conducted and if such reserves or other appropriate provision,if any, as shall be required by Mexican GAAP (or, in the case of Persons organizedunder laws of any other jurisdiction, the applicable GAAP therein) shall havebeen made therefor.

 

6.08.        Ranking;Priority.  The Company will, and willcause each of its Subsidiaries to, promptly take all actions as may benecessary to ensure that its obligations under the Loan Documents will at alltimes constitute direct, unconditional and general obligations thereof rankingat least *pari passu* in allrespects 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.        Compliancewith Laws.

 

(a)           TheCompany will, and will cause each of its Subsidiaries to, comply in allrespects with all applicable Requirements of Law, including all applicableEnvironmental Laws and all Requirements of Law relating to social security andERISA, including INFONAVIT, IMSS and SAR, except (i) where the necessityof compliance therewith is contested in good faith by appropriate proceedings promptlyinitiated and diligently conducted and if such reserves or other appropriateprovision, if any, as shall be required by Mexican GAAP (or, in the case ofPersons organized under laws of any other jurisdiction, the applicable GAAPtherein) shall have been made therefor or (ii) where any non-compliancecould not reasonably be expected to have a Material Adverse Effect.

 

(b)           Notwithstanding theforegoing, the Company will, and will cause each of its Subsidiaries to, complyin all respects with Requirements of Law relating to or arising frommaintaining the registration of securities with the Mexican Registro Nacionalde Valores (or any substitute registry) and listing of securities in the BolsaMexicana de Valores, S.A.B. de C.V. (or any substitute securities exchange),including filing all statements and reports (financial or 

 

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otherwise)required from time to time under applicable laws and regulations in Mexico; provided,however, that if at any time securities issued by the Company cease to be soregistered or listed for any reason, then the Company shall furnish to theLender (on a non-confidential basis) all such statements and reports (financialor otherwise) that the Company would have been required to file or disclosefrom time to time under applicable laws and regulations in Mexico, had suchsecurities continued to be so registered or listed.

 

6.10.        Maintenanceof Books and Records.

 

(a)           TheCompany will, and will cause each of its Mexican Subsidiaries to, maintainbooks, accounts and other records in accordance with Mexican GAAP, and theCompany will cause its Subsidiaries organized under laws of any otherjurisdiction to maintain their books and records in accordance either with theGAAP of the applicable jurisdiction or Mexican GAAP.

 

(b)           TheCompany will, and will cause each of its Material Subsidiaries to, permitrepresentatives of the Lender or its designee to visit and inspect any of theirrespective properties and to examine their respective corporate, financial andoperating books and records, all at such reasonable times during normalbusiness hours and as often as may be reasonably desired upon reasonableadvance notice to the Company or such Subsidiary, and one (1) such visitper 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.        IntercompanyIndebtedness.

 

(a)           TheCompany will and will cause its Subsidiaries to cause all 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*))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 Intercompany SubordinationAgreement and (ii) become a party to (x) an Intercompany RevolvingFacility and (y) in the case of any Subsidiary other than Subsidiaries inthe Gimsa Division, the Intercompany Trust Agreement and the IntercompanySubordination Agreement.  The Companywill treat the Obligations as senior in payment to any obligations owed to anySubsidiary that is part of the Gimsa Division by the Company in accordance withSection 7.19(c) (*IntercompanyIndebtedness*) and will not take any action that would result in theObligations not being treated as senior in payment to any obligations owed toany Subsidiary that is part of the Gimsa Division by the Company in accordancewith Section 7.19(c) (*Intercompany Indebtedness*).

 

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(b)           Duringthe pendency of any proceeding filed by or against the Company seeking reliefas debtor, or seeking to adjudicate the Company as bankrupt or insolvent, orseeking reorganization, arrangement, adjustment or composition of the Company orits debts under any law relating to bankruptcy, insolvency, reorganization, *concurso mercantil*,*quiebra*, or relief of debtors, or seekingappointment of a receiver, trustee, assignee, custodian, liquidator or *visitador*, *conciliador* or *sindico*or any other similar official for the Company or for any substantial part ofits property, the Company will cause each Subsidiary to vote any claims thatsuch Subsidiary might have based on Intercompany Indebtedness in the samemanner as the majority of the third party creditors of the Company.

 

6.12.        FurtherAssurances.  The Company will, andwill cause each of its Subsidiaries to, at the Company’s own cost and expense,execute and deliver to the Lender all such other documents, instruments andagreements and do all such other acts and things as may be reasonably requiredin the opinion of the Lender or its counsel, to enable the Lender to exerciseand enforce its rights under, and to enable the Lender and the Company to carryout the intent of this Agreement or the other Loan Documents including in eachcase (i) making payments of fees and other charges and (ii) publishingor otherwise delivering notice to third parties.

 

ARTICLEVIINEGATIVE COVENANTS

 

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

 

7.01.        NegativePledge.  The Company will not, andwill not cause or permit any of its Subsidiaries (other than any Subsidiarythat is part of the Venezuelan Division) to, directly or indirectly, create,incur, assume or suffer to exist any Lien upon or with respect to any of itspresent or future Property, except the following Liens (each a “PermittedLien”):

 

(a)           anyLien existing to secure the Secured Indebtedness (including any Lien created byan amendment thereto in connection with the incurrence of Permitted RefinancingIndebtedness in respect of the Mandatory Prepayment Indebtedness);

 

(b)           theLiens in favor of the Initial Lender, the Other Minor Derivative Counterpartiesor the Major Derivative Counterparties on such Person’s Temporary Accounts; provided,however, that such Liens shall be terminated immediately upon payment ofthe Initial Lender’s Terminated Derivative 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)           anyLien on any Property (or, in the case of a line of credit secured by inventoryor accounts receivable, class of Property) existing on the date hereof and setforth in Schedule 7.01 (*Existing Liens*);provided that such Liens shall secure only those obligations which theysecure on the date hereof;

 

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(d)           anyLien on any asset securing all or any part of the purchase price of property orassets (excluding inventories) acquired or any portion of the cost ofconstruction, development, alteration or improvement of any property, facilityor asset or Indebtedness incurred or assumed solely for the purpose offinancing all or any part of the cost of acquiring or constructing, developing,altering or improving such property, facility or asset; provided that (i) suchIndebtedness is otherwise permitted by Section 7.16 (*Limitations on Incurrence of Additional Indebtedness*),(ii) such Indebtedness does not exceed the lesser of the cost and the fairmarket value of such property, facility or asset, and (iii) such Lienattaches solely to such property, facility or asset during the period that suchproperty, 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)           Liensof a Subsidiary existing prior to the time such Subsidiary became a Subsidiaryof the Company which (i) do not secure Indebtedness exceeding theaggregate principal amount of Indebtedness subject to such Lien prior to thetime such Subsidiary became a Subsidiary of the Company, (ii) do notattach to any Property other than the Property attached pursuant to such Lienprior to the time such Subsidiary became a Subsidiary of the Company, and (iii) werenot created in contemplation of such Subsidiary becoming a Subsidiary of theCompany;

 

(f)            anyLien on any Property existing thereon at the time of the acquisition of suchProperty and not created in connection with or in contemplation of suchacquisition;

 

(g)           anyLien on any Property (or, in the case of a line of credit secured by inventoryor accounts receivable, class of Property) securing an extension, renewal,refunding or replacement of Indebtedness or a line of credit secured by a Lienreferred to in clauses (c), (d), (e) or (f) above or this clause (g);provided that (A) the prior Lien was otherwise permitted pursuantto this Agreement at the time of such extension, renewal, refunding orreplacement; (B) such new Lien is limited to the Property (or, in the caseof a line of credit secured by inventory or accounts receivable, class ofProperty) which was subject to the prior Lien immediately before suchextension, renewal, refunding or replacement; and (C) the principal amountof Indebtedness or the amount of the line of credit secured by the prior Lienis not increased immediately before or in contemplation of or in connectionwith such extension, renewal, refunding or replacement;

 

(h)           anyLien securing taxes, assessments and other governmental charges, the payment ofwhich is not yet due or the payment of which is being contested in good faithby appropriate proceedings promptly initiated and diligently conducted and forwhich such reserves or other appropriate provision, if any, as shall berequired by Mexican GAAP or, in the case of Subsidiaries organized under lawsof any other jurisdiction, the applicable GAAP therein, shall have been made;

 

(i)            Liensincurred or deposits made in the Ordinary Course of Business in connection withworkers’ compensation, unemployment insurance, other types of social securityand any Liens imposed by ERISA;

 

(j)            statutoryLiens of landlords and Liens of carriers, warehousemen, mechanics, materialmen,repairmen or the like arising in the Ordinary Course of Business for sums notyet 

 

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due or the payment of which is being contested in goodfaith by appropriate proceedings promptly initiated and diligently conductedand for which such reserves or other appropriate provision, if any, as shall berequired by Mexican GAAP or, in the case of Subsidiaries organized under lawsof any other jurisdiction, the applicable GAAP therein, shall have been made;

 

(k)           anyLien created by attachment or judgment (provided that such attachment orjudgment does not constitute an Event of Default), unless the judgment itsecures shall not, within sixty (60) days after the entry thereof, have beendischarged or execution thereof stayed pending appeal;

 

(l)            anyLien on cash, Cash Equivalent Investments or in the form of a letter of credit,in each case created in connection with, and posted or granted as required by,a Hedging Agreement entered into in accordance with Section 7.18 (*Limitations on Hedging*) in an amount not in excessof US$35,000,000 (or the US Dollar Equivalent thereof) in the aggregate at anyone time**;** and

 

(m)          Lienscreated to secure Permitted New Indebtedness not in excess of US$250,000,000(or the US Dollar Equivalent thereof) in the aggregate consisting of:

 

(i)                    Liens onreal or personal property to secure Permitted New Capital Obligationsconsisting of Capital Lease Obligations not in excess of US$50,000,000 (or theUS Dollar Equivalent thereof); provided that any Lien on real orpersonal property to secure a Permitted New Capital Obligation consisting of aCapital Lease Obligation shall be on the real or personal property leasedpursuant to such Capital Lease Obligation; and

 

(ii)                   Liens on inventories oraccounts receivable created to secure Permitted New Working CapitalIndebtedness, whentaken together with Liens pursuant to clause (l)(i) of this Section 7.01, not in excess of US$250,000,000 (or the USDollar Equivalent thereof), subject to the restrictions on such Indebtedness inSection 7.16(g) (*Limitations onIncurrence of Additional Indebtedness*).

 

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

 

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

 

(i)                    AnyInvestment existing on the date hereof (A) as set forth on Schedule 7.02 (*Existing Investments*) if in excess ofUS$1,000,000 (or the US Dollar Equivalent thereof) and (B) if less thansuch amount, included in the financial statements of the Company and/or itsSubsidiaries prior to the date hereof;

 

(ii)                   CashEquivalent Investments;

 

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(iii)                  CapitalExpenditures not to exceed (A) the Permitted Capital Expenditures Amountand (B) any portion of the Permitted Capital Expenditures Amount carriedover in accordance with Section 7.14(b) (*Limitations on Capital Expenditures*);

 

(iv)                  Investmentsconsisting of extensions of credit of less than sixty (60) days in the natureof accounts receivable or notes receivable arising from the sale or lease ofgoods or services in the Ordinary Course of Business;

 

(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 inthe Core Business (otherthan Investments in the Venezuelan Division) made from any Net Cash Proceeds of a Permitted Company EquityIssuance that is consummated in accordance with Section 7.22(b) (*Equity Issuances*) that are not required tobe applied to the mandatory prepayment 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 assetsused in the Core Business (other than Investments in the Venezuelan Division) made from 50% of the Net Cash Proceeds of anAsset Sale during the relevant Reinvestment Period for such Asset Sale; providedthat (x) no Default or Event of Default has occurred and is continuing, orwill occur as a result of such Investment, (y) a Reinvestment Certificatehas been delivered within the applicable Required Payment Period for such AssetSale and (z) the Company has made any mandatory prepayments requiredpursuant to Section 2.05(a) (*MandatoryPrepayments*);

 

(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 permitted byand entered into in accordance with Section 7.16(f) (*Limitations on Incurrence of Additional Indebtedness*)and Section 7.18 (*Limitations onHedging*);

 

(ix)                   Investments in Intercompany Indebtedness permitted byand made in accordance with Sections 7.16(e), 7.16(h) or 7.16(j) (*Limitations on Incurrence of Additional Indebtedness*);and

 

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(x)                    Investmentsin Subsidiaries, other than Subsidiaries in the Venezuelan Division, consistingof (x) Intercompany Indebtedness Capitalization made prior to January 1,2010 in an aggregate amount not to exceed an amount equal to the sum of (A) theamount of Existing 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) Intercompany IndebtednessCapitalization in an aggregate amount not to exceed US$30,000,000 (or the USDollar Equivalent thereof) per annum thereafter; and

 

(b)           as long as no Default or Event ofDefault has occurred and is continuing, or will occur as a result of suchInvestment, in any Fiscal Year, if such Fiscal Year follows an Excess CashYear, the Company and its Subsidiaries may make, solely from the AvailableExcess Cash Amount for such Fiscal Year, Restricted Investments (other thanInvestments in the Venezuelan Division, which shall be deemed excluded fromthis Clause (b)) in an amount not to exceed in the aggregate for the Companyand its Subsidiaries the Permitted New Investment Amount

 

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

 

7.03.        Mergers, Consolidations, Sales andLeases.  The Company will not, andwill not permit or cause any of its Material Subsidiaries (other than anySubsidiary that is part of the Venezuelan Division) to (x) dissolve orliquidate, (y) merge, amalgamate or consolidate with or into, or (z) convey,transfer or lease all or substantially all of its Property (other than Propertyof any Subsidiary that is part of the Venezuelan Division) (whether now ownedor hereinafter acquired) to or in favor of any Person (in each case, whether inone transaction or a series of transactions), unless (i) the MinorDerivative Counterparties holding more than 50% of the then aggregateoutstanding principal amount of the Minor Derivative Counterparty Loans consentto any such dissolution, liquidation, merger, amalgamation, consolidation,conveyance, transfer or lease and (ii) immediately after giving effect toany dissolution, liquidation, merger, amalgamation, consolidation, conveyance,transfer or lease:

 

(a)           noDefault or Event of Default has occurred and is continuing; and

 

(b)           inthe case of a merger, amalgamation, consolidation, or conveyance, transfer orlease of substantially all of the Company’s Property, any corporation formed byany such merger or consolidation with the Company or the Person which acquiresby conveyance or transfer, or which leases, all or substantially all of theCompany’s Property shall expressly assume in writing the due and punctualpayment of the principal of, and interest on all Obligations, according totheir terms, and the due and punctual performance of all of the covenants andobligations of the Company under this Agreement by an instrument in form andsubstance reasonably satisfactory to the Lender and shall provide an opinion ofcounsel acceptable to the Lender, obtained at the Company’s expense, on whichthe Lender may conclusively 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 

 

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than a Material Operating Subsidiary or itsSubsidiaries) where the Material 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, transfer or leaseall or substantially all of its Property (whether now owned or hereinafteracquired) to or in favor of any Person (in each case, whether in onetransaction or a series of transactions).

 

7.04.        RestrictedPayments.  The Company will not, andwill not cause or permit any of its Subsidiaries to, declare or make, directlyor indirectly, any Restricted Payment, or incur any obligation (contingent orotherwise) to do so. Notwithstanding the foregoing limitation**,** and if and to the extent permitted by this Agreement,the Company or any Subsidiary may declare or make the followingRestricted Payments:

 

(a)           eachSubsidiary may make Restricted Payments:

 

(i)                    to theCompany (and, in the case of such Restricted Payment by a non-wholly-ownedSubsidiary, to each other owner of capital stock of such Subsidiary on a prorata basis based on their relative ownership interests);

 

(ii)                   consistingof dividend payments or other distributions in respect of such Subsidiary’scapital stock, partnership interest or ownership interest to any otherSubsidiary of the Company (and, in the case of such Restricted Payment by anon-wholly-owned Subsidiary, to each other owner of capital stock of suchSubsidiary on a prorata basis based on their relative ownershipinterests); and

 

(iii)                  other than as permitted by clauses (i) or(ii) above as long as no Default or Event of Default has occurred and iscontinuing, to wholly-owned Subsidiaries (other than any Subsidiary that ispart of the Venezuelan Division) (and, in the case of such Restricted Paymentby a non-wholly-owned Subsidiary, to the Company and any Subsidiary (other thanany Subsidiary that is part of the Venezuelan Division) and to each other ownerof capital 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)           theCompany and each Subsidiary may declare and make dividend payments or otherdistributions payable solely in the common stock of such Person; and

 

(c)           as long as no Default orEvent of Default has occurred and is continuing, or would occur as a result ofsuch Restricted Payment, Gimsa may purchase shares of the capital stockof Gimsa to the extent permitted pursuant to Section 7.02 (*Investments*).

 

7.05.        Other Agreements.  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 

 

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covenants)mandatory prepayments or events of default that are more restrictive than thoseset forth herein other than as set forth in the Major Derivative CounterpartyLoan and the BBVA Loan.

 

7.06.        Burdensome Agreements. The Company will not, and will not cause or permit any of itsSubsidiaries to, create, cause, incur, assume, enter into, renew, extend, suffer or permitto exist on or become effective, any consensual encumbrance or restriction ofany kind or agreement that: (a) expresslyprohibits or restricts the payment of dividends or other distributions to theCompany or the making of loans to the Company or the ability to transfer any ofits property or assets to any of the foregoing, other than in connection withthe maintenance, renewal or extension of any agreement listed in Schedule 5.12(b) (*Restrictive Subsidiary Agreements*), providedthat (i) the restrictions or prohibitions under such agreement are notincreased as a result of such renewal or extension, and (ii) in connectionwith any such renewal or extension of an agreement that does not alreadycontain any such prohibition, the Company will not, and will not permit itsSubsidiaries to, agree to or accept the inclusion of such prohibition; (b) subordinates anyIndebtedness (other than Intercompany Indebtedness) owed to the Company or itsSubsidiaries, 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 Company will not, and will not cause or permit any of its Subsidiariesto, enter into, renew or extend or be a party to any transaction or series ofrelated transactions with (a) any Affiliate of the Company, (b) anyJoint Venture Partner, or (c) any director or officer of the Company,except in each case if such transaction is entered into upon fair andreasonable terms no less favorable to the Company or such Subsidiary than areobtainable in a comparable arm’s length transaction with an independentunrelated third party that is not one of the persons listed in (a), (b) or(c) above.  The Company will not,and will not cause or permit any of its Subsidiaries to, enter into anytransaction other than on an arm’s length basis.

 

7.08.        NoSubsidiary Guarantees of Certain Indebtedness.  The Company will not cause or permit any ofits Subsidiaries, directly or indirectly, to guarantee or otherwise becomeliable or responsible for, in any manner, any Indebtedness of the Company.

 

7.09.        Interest Coverage Ratio.  The Companywill not permit its Interest Coverage Ratio as of the last day of any FiscalQuarter ending after the date of this Agreement to be less than the following ratios in the following years:

 

| **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                |

 

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7.10.        Leverage Ratio. The Company will not permit its Leverage Ratio on any date after thedate of this Agreement to be greater than the following ratios in the following years:

 

| **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, andwill not cause or permit any of its Subsidiaries to:

 

(a)           amend,modify or otherwise change any of its Organizational Documents in any way thatwould adversely affect the Lender; provided  that anyamendment, 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 the terms of any Reporting Indebtedness (includingthrough an amendment or modification to the Reporting IndebtednessDocumentation or the entry into any Contractual Obligation in respect of theReporting Indebtedness) in any way that would (i) require additionalmandatory prepayments of such Reporting Indebtedness, (ii) require theCompany or its Subsidiaries to incur any Liens, (iii) reduce the weightedaverage maturity of such Reporting Indebtedness, (iv) increase theinterest rate or any other amount payable in respect of such ReportingIndebtedness, (v) require the payment of any fees to the holders of suchReporting Indebtedness (other than nominal amendment and waiver fees in amountsconsistent with market practice at the time such fees are paid), or (vi) in any way that would otherwise adversely affect (x) the economic rightsof the Lender or (y) the economic obligations of the Company in a moreonerous manner than the terms of such Reporting Indebtedness;

 

(c)           takeany action or conduct its affairs in a manner that could reasonably be expectedto result in its corporate existence being ignored by any court of competentjurisdiction or in its assets and/or liabilities being substantivelyconsolidated with those of any other Person in a bankruptcy, reorganization orother insolvency proceeding; or

 

(d)           withrespect to the Company, change its accounting policies or tax reportingpractices (other than as permitted by Mexican GAAP) or change the end of itsFiscal Year to a date other than December 31 (regardless of whether suchchange is permitted by Mexican GAAP).

 

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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) the consideration for such Asset Sale is at least 80% cash and (ii) a mandatory prepayment is made in accordance with Section 2.05(a) (*Mandatory Prepayments*), if applicable**;**

 

(b)           The Company and its Subsidiaries may acquireall or substantially all of the assets or capital stock of any Person (the “Target”)(in each case, a “Permitted Acquisition”) subject to any otherlimitations under this Agreement and the satisfaction of each of the followingconditions:

 

(i)                    the Lender shall receive at least fifteen(15) days’ prior written notice of such proposed Permitted Acquisition, whichnotice shall include a reasonably detailed description of such proposedPermitted Acquisition;

 

(ii)                   such Permitted Acquisition shall only involveassets comprising a business, or those assets of a business, engaged in theCore Business, and which would not subject the Lender to regulatory or thirdparty approvals in connection with the exercise of its rights and remediesunder this Agreement or any other Loan Documents other than approvalsapplicable to the exercise of such rights and remedies with respect to Companyprior to such Permitted Acquisition;

 

(iii)                  no additional Indebtedness or other liabilitiesother than Indebtedness permitted pursuant to Section 7.16 (*Limitations on Incurrence of Additional Indebtedness*)shall be incurred, assumed or otherwise be reflected on a consolidated balancesheet of Company and Target after giving effect to such Permitted Acquisition,except ordinary course trade payables and accrued expenses;

 

(iv)                  the sum of all amounts payable in connectionwith all Permitted Acquisitions (including, without duplication, alltransaction costs and all Indebtedness and liabilities (other than customaryindemnities provided by purchasers) incurred or assumed in connection therewithor otherwise reflected on a consolidated balance sheet of Company and Target)shall be permitted pursuant to Section 7.02 (*Investments*);

 

(v)                   at the time of such Permitted Acquisition andafter giving effect thereto, no Default or Event of Default has occurred and iscontinuing;

 

(vi)                  the business and assets acquired in such PermittedAcquisition shall be free and clear of all Liens (other than Liens permittedpursuant to Section 7.01 (*NegativePledge*)); and

 

(vii)                 with respect to any Permitted Acquisitionwhere the aggregate consideration (including any assumption of Indebtedness) inconnection therewith is equal to or greater than US$40,000,000 (or the US DollarEquivalent thereof):

 

(A)                  Target shall have had a consolidated EBITDA ofgreater than negative US$5,000,000 (or the US Dollar Equivalent thereof), proforma for adjustments reasonably satisfactory to the Lender for the trailingtwelve-month 

 

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period preceding the date of the PermittedAcquisition, as determined based upon the Target’s financial statements for itsmost recently completed fiscal year and its most recent interim financialperiod completed within sixty (60) days prior to the date of consummation ofsuch Permitted Acquisition; and

 

(B)                   Concurrently with delivery of the notice referred toin clause (i) above, the Company shall have delivered to the Lender:

 

1.               a proforma consolidated balance sheet, income statement and cash flow statement ofthe Company and its Subsidiaries (the “Acquisition Pro Forma”), based onrecent financial statements, which shall be complete and shall fairly presentin all material respects the assets, liabilities, financial condition andresults of operations of the Company and its Subsidiaries in accordance withGAAP consistently applied, but taking into account such Permitted Acquisition;and

 

2.               a certificate of the chief financial officer of the Company to the effectthat:  (i) the Company will beSolvent upon the consummation of the Permitted Acquisition; (ii) theAcquisition Pro Forma fairly presents the financial condition of the Companyand its Subsidiaries (on a consolidated basis) as of the date thereof aftergiving effect to the Permitted Acquisition; and (iii) the Company and itsSubsidiaries have completed their due diligence investigation with respect tothe Target and such Permitted Acquisition, which investigation has producedresults satisfactory to the Company and its Subsidiaries.

 

7.13.        Limitationson Sale Lease-Back Transactions.  TheCompany will not, and will not cause or permit any of its Subsidiaries (otherthan Subsidiaries 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)           Subjectto clauses (b) and (c) below, the Company will not, and will notcause or permit any of its Subsidiaries to, directly or indirectly, make (or beor become legally or contractually obligated to make) any Capital Expenditures(other than Capital Expenditures in Venezuela by Subsidiaries that are part ofthe Venezuelan Division) during any Fiscal Year that would cause the aggregate CapitalExpenditures for such year to exceed thePermitted Capital Expenditures Amount for such Fiscal Year (which amount shallinclude any Permitted New Capital Obligations consisting of Capital LeaseObligations incurred in such Fiscal Year).

 

(b)           Tothe extent that the Company and its Subsidiaries do not expend the fullPermitted Capital Expenditures Amount in any given Fiscal Year the Company andits Subsidiaries will be permitted to carry forward any Unused CapEx to theimmediately following Fiscal Year (but not to any subsequent Fiscal Year); providedthat (i) the Company has delivered 

 

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the CapEx Report in the present Fiscal Year and (ii) no Default orEvent of Default has occurred and is continuing or would occur after givingeffect to such transaction**.**

 

(c)           Inaddition to the foregoing, the Company may, in its discretion, make additionalCapital Expenditures to the extent permitted by Section 7.02(b) (*Investments*); provided that (i) theCompany has delivered the CapEx Report in the present Fiscal Year and (ii) noDefault or Event of Default has occurred and is continuing or would occur aftergiving effect to such Capital Expenditure.

 

7.15.        Limitationson Voluntary Prepayments of Indebtedness. The Company will not, and will not cause or permit any of itsSubsidiaries to, directly or indirectly make any payment in violation of anysubordination terms of any Indebtedness, other than the payment of VenezuelanNon-Recourse Indebtedness by any Subsidiary that is part of the VenezuelanDivision.

 

7.16.        Limitationson Incurrence of Additional Indebtedness. The Company will not, and will not cause or permit any of itsSubsidiaries to, directly or indirectly, create, incur, assume or suffer toexist any Indebtedness; provided that the Company and its Subsidiariesshall be permitted to incur, assume, or suffer to exist, without duplication:

 

(a)           Indebtednessunder the Loan Documents;

 

(b)           ExistingIndebtedness listed on Schedule 5.20(a) (*ExistingIndebtedness*);

 

(c)           PermittedRefinancing Indebtedness (provided that, if applicable, the Companymakes any mandatory prepayment required by Section 2.05(d) (*Mandatory Prepayments*));

 

(d)           VenezuelanNon-Recourse Indebtedness;

 

(e)           VenezuelanRecourse Indebtedness in respect of Indebtedness owed to Persons other than theCompany or its Affiliates in an amount not to exceed US$40,000,000 (or the USDollar Equivalent thereof) outstanding at any one time to the extent such VenezuelanRecourse Indebtedness is Working Capital Indebtedness, the proceeds of whichare used solely for grain purchases (“PermittedVenezuelan Recourse Indebtedness”);

 

(f)            theAgreement Value of Hedging Agreements executed in accordance with Section 7.18(*Limitations on Hedging*);

 

(g)           As long as no Default orEvent of Default has occurred and is continuing or would occur after givingeffect to such Indebtedness under this clause (g), additional Indebtedness nototherwise permitted by this Section 7.16 in an aggregate amount for theCompany and its Subsidiaries at any time outstanding not to exceed an amountequal to (x) US$250,000,000 (or the US Dollar Equivalent thereof) less (y) the aggregateprincipal amount of all Reporto Contracts outstanding at such time (suchIndebtedness, “Permitted New Indebtedness”), to the extent suchPermitted New Indebtedness:

 

(i)                    is eitherunsecured or secured in accordance with Section 7.01 (*Negative Pledge*); and

 

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(ii)                   consists ofeither: (x) Working Capital Indebtedness (excluding Venezuelan RecourseIndebtedness) (such Working Capital Indebtedness, “Permitted New Working CapitalIndebtedness”) or (y) no more than US$50,000,000 (or the US DollarEquivalent thereof) of Capital Lease Obligations and/or Sale Lease-BackTransactions related to the Company’s Core Business (collectively, “PermittedNew Capital Obligations”);

 

(h)           anyof the following Guaranty Obligations in respect of Indebtedness owed toPersons other than the Company or its Affiliates (provided that solely for thepurposes of this Section 7.16(h), Grupo Financiero Banorte S.A.B. de. C.V.and its Subsidiaries shall not be considered Affiliates of the Company):

 

(i)                    GuarantyObligations of a Subsidiary in respect of obligations of its direct or indirectSubsidiaries that are related to the Core Business provided that, notwithstanding the foregoing, anySubsidiary that is not part of the Venezuelan Division may not incur GuarantyObligations in respect of obligations of any Subsidiary that is part of theVenezuelan Division;

 

(ii)                   thePermitted Bancomext Guaranty;

 

(iii)                  theGuaranty Obligation incurred by the Company in respect of operating leases ofSubsidiaries that are not part of the Gruma Corp. Division, the Latin AmericanDivisions or the Venezuelan Division; provided that such GuarantyObligation shall not exceed US$25,000,000 (or the US Dollar Equivalent thereof);

 

(iv)                  Guaranty Obligations of the Company in respectof Indebtedness not to exceed US$60,000,000 (or the US Dollar Equivalentthereof) outstanding principal amount in the aggregate at any time, consistingof:

 

(A)                  WorkingCapital Indebtedness (other than Venezuelan Recourse Indebtedness, andincluding Guaranty Obligations in respect of Existing Working CapitalIndebtedness but excluding the Permitted Bancomext Guaranty) or IT Operating Leases ofSubsidiaries that are part of the Gimsa Division, in each case to the extentpermitted under this clause (iv), which Working Capital Indebtedness and ITOperating Leases shall not exceed US$60,000,000 (or the US Dollar Equivalentthereof) of outstanding principal amount in the aggregate at any time**;**

 

(B)                   Working Capital Indebtedness of Subsidiaries that arepart of the Central America Division (including Guaranty Obligations in respect of Existing Working CapitalIndebtedness but excluding the Permitted Bancomext Guaranty), to the extentpermitted pursuant to this clause (iv), which Working Capital Indebtednessshall not exceed US$35,000,000 (or the US Dollar Equivalent thereof) ofoutstanding principal amount in the aggregate at any time;

 

(C)                   WorkingCapital Indebtedness of Subsidiaries that are part of the Molinera Division(including Guaranty Obligations in respect of Existing Working CapitalIndebtedness but excluding the Permitted Bancomext Guaranty), 

 

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to the extent permitted pursuant to this clause(iv), which Working Capital Indebtedness shall not exceed US$20,000,000 (or theUS Dollar Equivalent thereof) of outstanding principal amount in the aggregateat any time;

 

(i)            OtherRestructured Indebtedness; and

 

(j)            IntercompanyIndebtedness (i) evidenced by and issued pursuant to the Intercompany RevolvingFacilities in accordance with Section 6.11 (*Intercompany Indebtedness*), (ii) subordinated to theLoan pursuant to the Intercompany Subordination Agreement and the IntercompanyTrust Agreement (other than, in each case, Intercompany Indebtedness owed bythe Company to a Subsidiary in the Gimsa Division) and (iii) where allrights 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 Companyshall not, and shall not cause or permit any of its Subsidiaries or any ERISAAffiliate to (i) permit any Pension Plan to incur any “funding deficiency,”whether or not waived, within the meaning of Section 302 of ERISA or Section 412of the Code or (ii) permit or cause the Unfunded Pension Liability of allPension Plans to exceed, in the aggregate, US$10,000,000 (or the US DollarEquivalent thereof).

 

7.18.        Limitationson Hedging.

 

(a)           TheCompany will not, and will not cause or permit any Subsidiary to, enter into(or become legally obligated to enter into) any Hedging Agreement ortransaction under any Hedging Agreement that:

 

(i)                    is forspeculative purposes or is with the aim of obtaining profits based on changingmarket values;

 

(ii)                   is based onor associated with the underlying value of a product, interest rate or currencyother than those products, interest rates or currencies that are used by theCompany or such Subsidiary in the Ordinary Course of Business;

 

(iii)                  has anotional value that exceeds:

 

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(A)                  in the caseof a commodity or product, 150% of the volume of such commodity or productconsumed by the Company or such Subsidiary during the most recent MeasurementPeriod; or

 

(B)                   in the caseof an interest rate or currency, the Company’s or such Subsidiary’srequirements for such interest rate or currency (pursuant to the Company’s orsuch Subsidiary’s Contractual Obligations) for the eighteen (18) monthsimmediately following the date of such Hedging Agreement;

 

(iv)                  has a tenorof more than eighteen (18) months;

 

(v)                   would causethe aggregate notional amount of all Hedging Agreements with any singlecounterparty to exceed US$100,000,000 (or the US Dollar Equivalent thereof);

 

(vi)                  is with acounterparty other than a Qualified Counterparty; or

 

(vii)                 is inviolation of, or otherwise violates, the Hedging Policy as in effect from timeto 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 withclauses (i), (ii), (v), (vi) and (vii) above.

 

(b)           TheCompany will not:

 

(i)                    permit orcause the effectiveness of the Hedging Policy to lapse until the Loan has beenrepaid;

 

(ii)                   permit orcause the Hedging Policy to permit hedging for speculative purposes orwith the aim of obtaining profits based on changing market values;

 

(iii)                  amend orotherwise change the Hedging Policy unless (x) such amendment or changehas been approved by the Board of Directors of the Company (or of a committeeduly delegated by such Board of Directors comprised of two (2) or moremembers thereof) and (y) the Lender is provided with written notice andcopies of such amendment or change to the Hedging Policy no later than five (5) BusinessDays after any such amendment or change is approved as contemplated above.

 

7.19.        IntercompanyIndebtedness.

 

(a)           The Company will not, andwill not cause or permit any Subsidiary to, enter into or maintain anyIntercompany Indebtedness other than (i) Guaranty Obligations permitted bySections 7.16(e) and 7.16(h) (*Limitationson Incurrence of Additional Indebtedness*) and (ii) IntercompanyIndebtedness entered into pursuant to Section 6.11 (*Intercompany Indebtedness*) and that iseither (x) owed to any Subsidiary in the Gimsa Division by the Company or (y) subordinatedto the Loan pursuant to the Intercompany Subordination Agreement and the 

 

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IntercompanyTrust Agreement, and where all rights of such Intercompany Lender of suchIntercompany Indebtedness (other than Intercompany Indebtedness owed to anySubsidiary in the Gimsa Division by the Company) have been assigned to theTrustee pursuant to the Intercompany Trust Agreement.

 

(b)           The Company will not, andwill not cause or permit any Subsidiary to, amend or waive any part of theIntercompany Revolving Facilities in any way that would result in (i) aviolation of this Agreement or (ii) a change of any kind in the provisionsof the Intercompany Revolving Facilities relating to the subordination of theIntercompany 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 or cause the Company and its Material Subsidiaries to:

 

(a)           ownless than 85% of the total assets of the Company and its ConsolidatedSubsidiaries as of the end of the Company’s most recently completed FiscalYear; or

 

(b)           generateless than 85% of earnings before income tax and employee statutory profitsharing of the Company and its Consolidated Subsidiaries as of the end of theCompany’s most recently completed 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 theReporto Contracts at any time when taken together with all Permitted NewIndebtedness shall not exceed US$250,000,000 (or the US Dollar Equivalentthereof).

 

7.22.        EquityIssuances.  The Company will not, andwill not cause or permit any Subsidiary to issue any capital stock of theCompany or such Subsidiary, except:

 

(a)           theCompany may pay dividends in capital stock of the Company and a Subsidiary ofthe Company may pay dividends in capital stock of such Subsidiary, in each casein accordance with Section 7.04(b) (*RestrictedPayments*); and

 

(b)           theCompany may issue capital stock of the Company in a primary offering (suchissuance a “Permitted Company Equity Issuance”); provided thatthe Company makes any required mandatory prepayment of the Mandatory PrepaymentIndebtedness.

 

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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*)).

 

ARTICLEVIIIEVENTS OF DEFAULT

 

8.01.        Eventsof Default.  Any of the followingevents shall constitute an “Event of Default”:

 

(a)           Non-Payment.  The Company fails to pay (i) when and asrequired to be paid herein, any amount of principal of the Loan, (ii) withinthree (3) days after the same becomes due, any interest payablehereunder or under any other Loan Document or (iii) within five (5) days afterthe same becomes due, any other amount payable hereunder (including any amountdue under 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)           Representationor Warranty.  Any representation orwarranty by the Company made herein or in any other Loan Document, or which iscontained in any certificate, document or financial or other statement by theCompany or any Senior Officer of the Company, furnished at any time under thisAgreement or any other Loan Document, is incorrect in any material respect onor as of the date made; or

 

(c)           SpecificDefaults.  The Company fails toperform or observe any term, covenant or agreement contained in Sections 6.02(a) (*Notice of Other Events*), 6.03(a) (*Maintenance of Existence; Conduct of Business*)with respect to the corporate existence of the Company and the MaterialSubsidiaries, 6.05 (*Maintenance ofGovernment Approvals*), 6.08 (*Ranking;Priority*) or fails to perform or observe any term, covenant oragreement contained in Article VII (*NegativeCovenants*); or

 

(d)           OtherDefaults.  The Company fails toperform or observe any other term or covenant contained in this Agreement or inany other Loan Document **(**otherthan as specified in clauses (a) and (c) above), and such defaultcontinues unremedied for a period of thirty (30) days after the earlier of (a) date upon which written notice thereof is given to theCompany by the Lender or (b) thedate on which the Company has knowledge thereof; or

 

(e)           Cross-Default.  The Company or any of its Material Subsidiaries(i) fails to make any payment in respect of any Indebtedness (other thanIndebtedness hereunder and under the Note) having an aggregate principal amount(or its US Dollar Equivalent) equal to US$20,000,000 (or the US DollarEquivalent thereof) or more when due (whether by scheduled maturity, requiredprepayment, acceleration, demand, or otherwise) and such failure continuesafter the applicable grace period, if any, specified in the agreement orinstrument relating to such Indebtedness; or (ii) fails to perform orobserve any other condition or covenant, or any other event shall occur orcondition exist, under any agreement or instrument relating to suchIndebtedness, and such failure continues after the applicable grace or noticeperiod, if any, specified in the relevant document on the date of such failureif the effect of such failure, event 

 

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or condition is to cause, or to permit the holder orholders of such Indebtedness to cause, such Indebtedness to be declared to bedue and payable prior to its stated maturity; or

 

(f)            BBVADefault.  There shall have occurredand be continuing an “Event of Default” under the BBVA Loan (as definedtherein); or

 

(g)           InvoluntaryProceedings.  (i) A decree ororder by a court having jurisdiction has been entered adjudging the Company orany Material Subsidiary as bankrupt or insolvent, or approving as properlyfiled a petition seeking reorganization, *concursomercantil*, *quiebra*orbankruptcy of the Company or any Material Subsidiary and such decree or ordershall have continued undischarged and unstayed for a period of sixty (60) consecutive days; or (ii) a decree or order of a court havingjurisdiction 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)           VoluntaryProceedings.  The Company or anySubsidiary institutes proceedings to be adjudicated bankrupt or consents to thefiling of a bankruptcy proceeding against it, or files a petition or answer orconsent in any proceeding seeking reorganization, *concurso mercantil*, *quiebra*or bankruptcy or consents to the filing of any such petition, orconsents to the appointment of a receiver or liquidator or trustee or *visitador*, *conciliador*or s*índico*orassignee in bankruptcy or insolvency or any other similar official of it or anysubstantial part of its Property, or admits in writing that it is unable to payits debts, or fails to generally to pay its debts when they come due or makes ageneral assignment for the benefit of creditors; or

 

(i)            MonetaryJudgments.  One or more judgments,orders, attachments or *embargos*,decrees or arbitration awards are entered against the Company or any of itsSubsidiaries involving in the aggregate a liability (to the extent not coveredby independent third-party insurance as to which the insurer does not disputecoverage) as to any single or related series of transactions, incidents orconditions, of an amount (or its US Dollar Equivalent) equal to US$20,000,000(or, if in another currency, the US Dollar Equivalent thereof), and the sameshall remain unsatisfied, unvacated or unstayed pending appeal for a period ofsixty (60) consecutive days after the entry thereof; or

 

(j)            Unenforceability.  Any of the Loan Documents or theIntercompany 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

 

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(k)           Expropriation.  Any Governmental Authority Expropriates allor a substantial portion of (x) the Property of the Company and itsSubsidiaries taken as a whole or (y) the common stock of the Company; or

 

(l)            Change of Control.  Any Change in Control hasoccurred; or

 

(m)          Intercompany Trust Agreement.  At any time the assignment ofrights pursuant to the Intercompany Trust Agreement (i) shall be or becomeunenforceable, (ii) shall be contested or denied in writing by anyIntercompany Lender or (iii) shall be contested or denied in writing by any GovernmentalAuthority and such contest or denial shall continue unstayed for a period ofsixty (60) consecutive days**;** or

 

(n)           GovernmentApproval.  Any approval,authorization, consent or registration of a Governmental Authority that is atany time necessary to enable the Company to comply with any of its obligationsunder any of the Loan Documents is revoked, withdrawn, withheld or otherwisenot in full force and effect and is not reinstated to the satisfaction of theLender within the earlier of (i) ten (10) days after such revocation,withdrawal, withholding or other loss of effectiveness or (ii) the third(3rd) Business Day before the day in which itshall be required to enable the Company to comply with its obligations underthe Loan Documents; or

 

(o)           ERISA.  (i) An ERISA Event has occurred; (ii) theCompany, any Subsidiary or any ERISA Affiliate has been notified by the sponsorof a Multiemployer Plan that it has incurred Withdrawal Liability to suchMultiemployer Plan or that such Multiemployer Plan is in reorganization or isbeing terminated, partitioned or reorganized; (iii) the Company or anERISA Affiliate fails to pay, when due, after the expiration of any applicablegrace period, any installment payment with respect to its Withdrawal Liabilityunder Section 4201 of ERISA or (iv) the Company, any Subsidiary orany ERISA Affiliate has incurred any liability in connection with a withdrawalfrom a Pension Plan subject to Section 4063 of ERISA, such that, in thecase of any event described in (i), (ii), (iii) or (iv), the Company, anySubsidiary or any ERISA Affiliate has incurred, in the aggregate andaggregating liabilities resulting from all such events that have occurred,liability equal to US$20,000,000 (or the US Dollar Equivalent thereof) or more;or

 

(p)           Lapseof Process Agent.  The Company’sappointment of the Process Agent or the Alternate Process Agent shall havelapsed, whether because of nonpayment of fees or otherwise, and such lapseremains unremedied for a period of three (3) Business Days after theCompany obtains knowledge or receives notice thereof.

 

8.02.        Remedies.  (a)  If any Event of Default occurs, theLender may take any or all of the following actions:

 

(i)                    declare theunpaid principal amount of the Loan, all interest accrued and unpaidthereon, and all other Obligations owing or payable hereunder or under anyother Loan Document to be immediately due and payable, without presentment,demand, protest or other notice of any kind, all of which are hereby expresslywaived by the Company; and

 

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(ii)                   exerciseall rights and remedies available to the Lender under the Loan Documents orapplicable law;

 

(b)           Notwithstandingthe foregoing, upon the occurrence of any event specified in Section 8.01(g) (*Involuntary Proceedings*) or 8.01(h) (*Voluntary Proceedings*), the unpaidprincipal amount of the Loan and all interest and otherObligations shall automatically become due and payable without further act ofthe Lender.

 

(c)           Afterthe exercise of remedies provided for in this Section 8.02 (or after theLoan has automatically become immediately due and payable), any amountsreceived on account of the Obligations shall be applied by the Lender in thefollowing order:

 

(i)                    first, topayment of that portion of the Obligations constituting fees, indemnities andother amounts (other than principal and interest) payable to the Lender(including Attorney Costs and amounts payable under Article III (*Taxes, Yield Protection and Illegality*));

 

(ii)                   second, to payment of thatportion of the Obligations constituting accrued and unpaid interest on theLoan;

 

(iii)                  third, to payment of thatportion of the Obligations constituting unpaid principal of the Loan; and

 

(iv)                  last, the balance, if any,after all of the Obligations have been indefeasibly paid in full, to theCompany or as otherwise required by law.

 

8.03.        RightsNot Exclusive.  The rights providedfor in this Agreement and the other Loan Documents are cumulative and are notexclusive of any other rights, powers, privileges or remedies provided by lawor in equity, or under any other instrument, document or agreement now existingor hereafter arising.

 

ARTICLEIXMISCELLANEOUS

 

9.01.        Amendmentsand Waivers.  No amendment or waiverof any provision of this Agreement or any other Loan Document, and no consentto any departure by the Company therefrom, shall be effective unless the sameshall be in writing and signed by the Lender and the Company, and then any suchwaiver or consent shall be effective only in the specific instance and for thespecific purpose for which given.

 

9.02.        Notices.

 

(a)           Exceptas otherwise expressly provided herein, all notices, requests, demands or othercommunications to or upon any party hereunder shall be in English and inwriting (including facsimile transmission and, subject to clause (c) below,a PDF attachment to an electronic mail message) and shall be mailed by aninternationally recognized overnight courier service, transmitted by facsimileor electronic mail or delivered by hand to such party: (i) in the case ofthe Company or the Initial Lender, at its address, facsimile number orelectronic mail 

 

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address set forth on Schedule 9.02 (*Notices*) hereof or at such other address,facsimile number or electronic mail address as such party may designate bynotice to the other parties hereto, and (ii) in the case of any Lenderother than the Initial Lender, at its address, facsimile number or electronicmail address set forth in the Administrative Questionnaire or at such otheraddress, facsimile number or electronic mail address as the Lender maydesignate by notice to the Company.

 

(b)           Unlessotherwise expressly provided for herein, each such notice, request, demand orother communication shall be effective upon the earlier to occur of (i) actualreceipt and (ii) (A) if sent by overnight courier service ordelivered by hand, when signed for by or on behalf of the party to whom suchnotice is directed, (B) if given by facsimile, when transmitted to thefacsimile number specified pursuant to clause (a) above and confirmationof receipt of a legible copy is received by telephone, return facsimile orelectronic mail, or (C) if given by any other means, when delivered at theaddress 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 IXshall not be effective until received. Delivery by the Lender by facsimile transmission or electronic mail ofan executed counterpart of any amendment or waiver or any provision of thisAgreement or the Note or any other Loan Document to be executed and deliveredhereunder shall be effective as delivery of a manually executed counterpartthereof.

 

(c)           Electronicmail and internet websites may be used only to distribute routinecommunications, such as financial statements, Casualty Certificates,Reinvestment Certificates, or any certificate or document required by Article IV(*Conditions Precedent*) (exceptfor the Initial Lender’s Note), Article VI (*Affirmative Covenants*) or Article VII (*Negative Covenants*) and other relatedinformation, and to distribute Loan Documents for execution by the partiesthereto, and may not be used for any other purpose.

 

9.03.        NoWaiver; Cumulative Remedies.  Nofailure to exercise and no delay in exercising, on the part of the Lender, anyright, remedy, power or privilege hereunder or under any Loan Document, shalloperate as a waiver thereof; nor shall any single or partial exercise of anyright, 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)           topay or reimburse the Initial Lender (i) upon demand for all reasonable anddocumented costs and expenses (including Attorney Costs) incurred by theInitial Lender in connection with the Terminated Derivative Obligation and thepreparation, negotiation, administration and execution of the Loan Documents(whether or not consummated) and (ii) within five (5) Business Daysafter demand for all reasonable and documented costs and expenses incurred bythe Lender in connection with any amendment, supplement, waiver or modificationrequested by the Company (in each case, whether or not consummated) to thisAgreement or any other Loan Document, including Attorney Costs incurred by theLender with respect thereto; provided that the obligation of the Companywith respect to the reimbursement 

 

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of Attorney Costs shall in any event be limited to one(1) US counsel and one (1) local Mexican counsel; and

 

(b)           topay or reimburse the Lender within five (5) Business Days after demand forall reasonable costs and expenses (including Attorney Costs) incurred by themin connection with the enforcement, attempted enforcement, or preservation ofany rights or remedies under this Agreement or any other Loan Document duringthe existence of an Event of Default or after acceleration of the Loan(including in connection with any “workout” or restructuring regarding theLoan, and including in any insolvency or bankruptcy proceeding involving theCompany).

 

9.05.        Indemnificationby the Company.  Whether or not thetransactions contemplated hereby are consummated, the Company agrees toindemnify and hold harmless the Lender and its respective Affiliates,directors, officers, employees, counsel, agents and attorneys-in-fact(collectively the “Indemnitees”) from and against: (a) any and alldirect, punitive and consequential damages, claims, demands, actions or causesof action that are asserted against any Indemnitee by any Person relating,directly or indirectly, to a claim, demand, action or cause of action that suchPerson asserts or may assert against the Company or any of its respectiveofficers or directors, (b) any and all claims, demands, expenses(including Attorney Costs) actions or causes of action that may at any time(including at any time following repayment of the Obligations and thereplacement of the Lender) be asserted or imposed against any Indemnitee,arising out of or relating to, the Loan Documents (including the preparation,negotiation, execution and administration thereof), or the use or contemplateduse of the proceeds of the Loan, (c) any administrative or investigativeproceeding by any Governmental Authority arising out of or related to a claim,demand, action or cause of action described in (a) or (b) above, and (d) anyand all liabilities (including liabilities under indemnities), losses, costs orexpenses (including Attorney Costs) that any Indemnitee suffers or incurs as aresult of the assertion of any foregoing claim, demand, action, cause of actionor proceeding, or as a result of the preparation of any defense in connectionwith any foregoing claim, demand, action, cause of action or proceeding, in allcases, whether or not an Indemnitee is a party to such claim, demand, action,cause of action or proceeding (all the foregoing, collectively, the “IndemnifiedLiabilities”), in all cases, whether or not caused by or arising, in wholeor in part, out of the negligence of the Indemnitee; provided that noIndemnitee shall be entitled to indemnification for any claim caused by its owngross negligence or willful misconduct or for any loss asserted against it byanother Indemnitee determined in a final, nonappealable judgment by a court ofcompetent jurisdiction.  No Indemniteesshall be liable for any damages arising from the use by others of anyinformation or other materials obtained through any information transmissionsystems in connection with this Agreement, nor shall any Indemnitee have anyliability for any indirect or consequential damages relating to this Agreementor any other Loan Document or arising out of its activities in connection herewithor therewith (whether before or after the Closing Date).  All amounts due under this Section 9.05shall be payable within ten (10) Business Days after demand therefor.  The agreements in this Section 9.05shall survive the repayment of all Obligations.

 

9.06.        PaymentsSet Aside.  To the extent that theCompany makes a payment to the Lender or the Lender exercises its right ofset-off, and such payment or the proceeds of such set-off or any part thereofare subsequently invalidated, declared to be fraudulent or preferential, setaside or required (including pursuant to any settlement entered into by theLender in its 

 

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discretion) to be repaid to a trustee, receiver or anyother party, in connection with any insolvency, “*concurso mercantil*” or bankruptcy proceeding involving theCompany or otherwise, then to the extent of such recovery, the obligation orpart thereof originally intended to be satisfied shall be revived and continuedin full force and effect as if such payment had not been made or such set-offhad not occurred.

 

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 be conclusive,absent manifest error, and the Company and the Lender may treat each Personwhose name is recorded in the Register pursuant to the terms hereof as theLender hereunder for all purposes of this Agreement, notwithstanding notice tothe contrary.  The Register shall beavailable for inspection by the Lender at any reasonable time and from time totime upon reasonable prior notice.

 

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(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 its Loan, a replacement Note for the assignorLender (such Note to be in exchange for, but not in payment of, the Note heldby the assigning Lender).  Immediatelyupon the assigning Lender and its Assignee having delivered to the Company aduly executed 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 solelyresponsible for the performance of such obligations, (iii) the Companyshall continue to deal solely and directly with the originating Lender inconnection with the originating Lender’s rights and obligations under thisAgreement and the other Loan Documents and (iv) the Lender shall nottransfer or grant any participating interest under which the Participant hasrights to approve any amendment to, or any consent or waiver with respect to,this Agreement or any other Loan Document. In the case of any such participation, the Lender selling suchparticipation shall be entitled to agree to pay over to the Participant anyamounts paid to the Lender pursuant to Section 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 ofmoney is scheduled to be paid to such Participant or (ii) reduce theprincipal, 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.

 

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(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 pledge or assignment shall release theLender from any of its obligations hereunder or substitute any such pledgee orassignee for the Lender 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 itsAffiliates’, directors, officers, employees and agents, including accountants,legal counsel and other advisors (it being understood that the Persons to whomsuch disclosure 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 anydirect or indirect credit insurance provider, insurer, insurance broker orrating agencies relating to the Company and the Obligations (v) to anyother party 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 the occurrenceof any Event of Default; or (ix) to the extent such Information (1) becomespublicly available other than as a result of a breach of this Section or (2) becomesavailable to the Lender on a nonconfidential basis from a source other than theCompany.  In addition, the Lender maydisclose the existence of this Agreement and information about this Agreementto 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 confidential information.  This Section 9.09 shall supersede anyprior confidentiality agreements entered into between the Company and theInitial Lender, and all Information provided prior to the date hereof shall besubject 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 the 

 

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Company to the fullest extent permitted by law, to setoff and apply any and all deposits (general or special, time or demand,provisional or final in any currency, matured or unmatured) at any time heldby, and other Indebtedness at any time owing by, the Lender to or for thecredit or the account of the Company against any and all Obligations owing tothe Lender, now or hereafter existing, irrespective of whether or not theLender 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 a signature page to thisAgreement by facsimile or electronic mail shall be effective as delivery of amanually executed counterpart of this Agreement.

 

9.13.        Severability.  The illegality or unenforceability of anyprovision of this Agreement or any instrument or agreement required hereundershall not in any way affect or impair the legality or enforceability of theremaining provisions of this Agreement or any instrument or agreement requiredhereunder.

 

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 

 

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DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,STATEMENT OR ACTIONS OF THE LENDER OR THE COMPANY RELATING THERETO.

 

(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, incare of 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 be enforcedin other jurisdictions by suit on the judgment or in any other manner providedby 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 legalprocess (whether service or notice, attachment prior to judgment, attachment inaid of execution of judgment, execution of judgment or otherwise) with respectto itself 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 

 

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the extent that on the Business Day following receiptby the Lender of any sum adjudged to be so due in the Other Currency the Lendermay in accordance with normal banking procedures purchase US Dollars with theOther Currency; if the amount of US Dollars so purchased is less than the sumoriginally due to the Lender in US Dollars, the Company hereby agrees, as aseparate obligation and notwithstanding any such judgment, to indemnify theLender 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 Accountant selectedby the mutual agreement of the parties, which in any event shall be the sameQualified Accountant selected in this respect for the Mandatory PrepaymentIndebtedness.  The Qualified Accountantshall consider only the IFRS Amendments and shall only make a decision withrespect thereto that is within the bounds set by the differing positions of theLender and the Company.  The QualifiedAccountant’s decision with respect thereto shall be final and binding on theparties hereto and shall be made in writing and notified to the parties heretoat least five (5) Business Days prior to the adoption of IFRS by theCompany.  Any IFRS Amendments agreedbetween the Company and the Lender or determined by the Qualified Accountantshall take effect as of the date of the Company’s adoption of IFRS.  The parties agree that no amendment fee shallbe payable by the Company to the Lender in respect of any IFRS Amendments otherthan 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:                   |   |
|   |                  | Name: |
|   |                  | Title: |
|   |                  |   |
|   |                  |   |
|   | By:                   |   |
|   |                  | Name: |
|   |                  | Title: |

 

*Signature Page toLoan 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

 
|   | ABN AMRO BANK N.V., |
|--------|---------------------|
|   | as Lender           |
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|   | By:                 |   |
|   |                | Name: |
|   |                | Title: |
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|   | By:                 |   |
|   |                | Name: |
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