LOAN AGREEMENT

dated as ofSeptember 21, 2005

amongVITRO ENVASES NORTEAMERICA, S.A. DE C.V.The GUARANTORS referred to hereinThe LENDERS party heretoandCREDIT SUISSE, 

acting through its Cayman Islands Branch,as Administrative Agent ___________________________CREDIT SUISSE,as Sole Lead Arranger and Bookrunner

 

  

**TABLE OF CONTENTS**

 
| Article  1. Definitions                                                                                |
|--------------------------------------------------------------------------------------------------------|
| Section 1.01. Defined Terms                                                                            |
| Section 1.02. Terms Generally                                                                          |
| Section 1.03. Accounting Terms; Changes in GAAP                                                        |
| Article  2. The Credits                                                                                |
| Section 2.01. Commitments                                                                              |
| Section 2.02. Request to Borrow                                                                        |
| Section 2.03. Funding of Loans                                                                         |
| Section 2.04. Interest Rate                                                                            |
| Section 2.05. Payment at Maturity; Evidence of Debt.                                                   |
| Section 2.06. Optional and Mandatory Prepayments                                                       |
| Section 2.07. Fees                                                                                     |
| Section 2.08. Alternate Rate of Interest                                                               |
| Section 2.09. Increased Costs                                                                          |
| Section 2.10. Break Funding Payments                                                                   |
| Section 2.11. Payments Generally; Pro Rata Treatment;  Sharing of Set-offs                             |
| Section 2.12. Lender's Obligation to Mitigate                                                          |
| Section 2.13. Judgment Currency                                                                        |
| Article  3. Representations and Warranties                                                             |
| Section 3.01. Organization; Powers                                                                     |
| Section 3.02. Stock                                                                                    |
| Section 3.03. Authorization; Enforceability                                                            |
| Section 3.04. Governmental Approvals                                                                   |
| Section 3.05. No Conflicts                                                                             |
| Section 3.06. Financial Statements; No Material Adverse  Change                                        |
| Section 3.07. Litigation                                                                               |
| Section 3.08. Properties                                                                               |
| Section 3.09. Compliance with Laws and Agreements                                                      |
| Section 3.10. Investment and Holding Company Status                                                    |
| Section 3.11. Taxes.                                                                                   |
| Section 3.12. Labor                                                                                    |
| Section 3.13. Insurance                                                                                |
| Section 3.14. Conduct of Business                                                                      |
| Section 3.15. Environmental and Regulatory Matters                                                     |
| Section 3.16. Pari Passu Status                                                                        |
| Section 3.17. Subsidiaries                                                                             |
| Section 3.18. Solvency                                                                                 |
| Section 3.19. Legal Form                                                                               |
| Section 3.20. Disclosure                                                                               |
| Article  4. Conditions                                                                                 |
| Section 4.01. Effective Date                                                                           |
| Article  5. Covenants                                                                                  |
| Section 5.01. Compliance Certificate                                                                   |
| Section 5.02. Waiver of Stay, Extension or Usury Laws                                                  |
| Section 5.03. Limitation on Incurrence of Additional  Indebtedness.                                    |
| Section 5.04. Limitation on Guarantees of Borrower or  Restricted Subsidiary Indebtedness              |
| Section 5.05. Limitation on Restricted Payments                                                        |
| Section 5.06. Limitation on Asset Sales.                                                               |
| Section 5.07. Limitation on the Ownership of Capital  Stock of Restricted Subsidiaries                 |
| Section 5.08. Limitation on Designation of Unrestricted  Subsidiaries                                  |
| Section 5.09. Limitation on Dividend and Other Payment  Restrictions Affecting Restricted Subsidiaries |
| Section 5.10. Limitation on Liens                                                                      |
| Section 5.11. Limitation on Transactions with  Affiliates.                                             |
| Section 5.12. Conduct of Business                                                                      |
| Section 5.13. Financial Statements and Other Information                                               |
| Section 5.14. Payment of Additional Amounts.                                                           |
| Section 5.15. Limitation On Merger, Consolidation And Sale Of Assets.                                  |
| Section 5.16. Use of Proceeds                                                                          |
| Section 5.17. Additional Guarantors                                                                    |
| Article  6. Events of Default                                                                          |
| Article  7. The Administrative Agent                                                                   |
| Section 7.01. Appointment and Authorization                                                            |
| Section 7.02. Rights and Powers as a Lender                                                            |
| Section 7.03. Limited Duties and Responsibilities                                                      |
| Section 7.04. Authority to Rely on Certain Writings,  Statements and Advice                            |
| Section 7.05. Sub-Agents and Related Parties                                                           |
| Section 7.06. Resignation; Successor Administrative  Agent                                             |
| Section 7.07. Credit Decisions by Lenders                                                              |
| Article  8. Loan Guarantees                                                                            |
| Section 8.01. Loan Guarantees                                                                          |
| Section 8.02. Guarantees Unconditional                                                                 |
| Section 8.03. Release of Guarantees                                                                    |
| Section 8.04. Waiver by Guarantors                                                                     |
| Section 8.05. Subrogation                                                                              |
| Section 8.06. Stay of Acceleration                                                                     |
| Section 8.07. Continuing Loan Guarantee                                                                |
| Article  9. Miscellaneous                                                                              |
| Section 9.01. Notices                                                                                  |
| Section 9.02. Waivers; Amendments                                                                      |
| Section 9.03. Expenses; Indemnity; Damage Waiver                                                       |
| Section 9.04. Successors and Assigns                                                                   |
| Section 9.05. Survival                                                                                 |
| Section 9.06. Counterparts; Integration; Effectiveness                                                 |
| Section 9.07. Severability                                                                             |
| Section 9.08. Right of Set-off                                                                         |
| Section 9.09. Governing Law; Jurisdiction; Consent to  Service of Process                              |
| Section 9.10. Waiver of Jury Trial                                                                     |
| Section 9.11. Headings                                                                                 |
| Section 9.12. Confidentiality                                                                          |
| Section 9.13. Interest Rate Limitation                                                                 |

 

LOAN AGREEMENT dated as of September 21, 2005 among VITROENVASES NORTEAMERICA, S.A. DE C.V., the GUARANTORS referred to herein, theLENDERS party hereto and CREDIT SUISSE, acting through its Cayman IslandsBranch, as Administrative Agent.

 

The parties hereto agree as follows:

 

**Article 1Definitions**

 

Section1.01*. Defined Terms.*As used in this Agreement, the following termshave the meanings specified below:

 

"**Acquired Indebtedness**" means Indebtedness of a Person orany of its Subsidiaries existing at the time such Person becomes a RestrictedSubsidiary or at the time it merges or consolidates with the Borrower or anyRestricted Subsidiary or is assumed by the Borrower or any RestrictedSubsidiary in connection with the acquisition of assets from such Person. SuchIndebtedness will be deemed to have been Incurred at the time such Personbecomes a Restricted Subsidiary or at the time it merges or consolidates withthe Borrower or a Restricted Subsidiary or at the time such Indebtedness isassumed by the Borrower or any Restricted Subsidiary in connection with theacquisition of assets from such Person.

"**Additional Amounts**" has the meaning assigned to it in Section5.14(b).

"**Additional Interest Letter**" shall mean the AdditionalInterest Letter substantially in the form of Exhibit B hereto between Vitro andthe Administrative Agent. 

"**Adjusted LIBOR**" means, for any Interest Period, aninterest rate per annum equal to (a) LIBOR for such Interest Period multipliedby (b) the Statutory Reserve Adjustment.

"**Administrative Agent**" means Credit Suisse, actingthrough its Cayman Islands Branch, in its capacity as administrative agentunder the Loan Documents.

"**Administrative Questionnaire**" means an AdministrativeQuestionnaire in substantially the form as set forth on Exhibit F hereto.

"**Affiliate**" means, with respect to any specified Person,any other Person who directly or indirectly through one or more intermediariescontrols, or is controlled by, or is under common control with, such specifiedPerson. For purposes of this definition, the term "control" means thepossession, directly or indirectly, of the power to direct or cause thedirection of the management and policies of a Person, whether through theownership of voting securities, by contract or otherwise. For purposes of thisdefinition, the terms "controlling," "controlled by" and "under common controlwith" have correlative meanings.

"**Affiliate Transaction**" has the meaning assigned to it inSection 5.11(a).

"**Agreement**" means this Loan Agreement, as the same may befurther amended from time to time, including the Schedules and Exhibits hereto.

  "**Alcali**"    means Industria del Alcali, S.A. de C.V., a Mexican corporation.

"**Alternate Rate**" has the meaning set forth in Section2.08.

"**Applicable Margin**" shall mean (i) during the period fromand including the Effective Date to but not including the date twelve monthsafter the Effective Date, 10.0% per annum; (ii) during the period from andincluding the date twelve months after the Effective Date to but not includingthe date fifteen months after the Effective Date, 10.5% per annum; and (iii)thereafter, 11.0% per annum.

"**Asset Acquisition**" means:

(a) an Investment by the Borrower or any RestrictedSubsidiary in any other Person pursuant to which such Person will become aRestricted Subsidiary, or will be merged with or into the Borrower or anyRestricted Subsidiary;

(b) the acquisition by the Borrower or any RestrictedSubsidiary of the assets of any Person (other than a Restricted Subsidiary ofthe Borrower) which constitute all or substantially all of the assets of suchPerson or comprises any division or line of business of such Person or anyother properties or assets of such Person other than in the ordinary course ofbusiness; or 

(c) any Revocation with respect to an UnrestrictedSubsidiary.

"**Asset Sale**" means any direct or indirect sale,disposition, issuance, conveyance, transfer, lease, assignment or othertransfer, including a Sale and Leaseback Transaction (each, a "disposition") bythe Borrower or any Restricted Subsidiary of:

(a) any Capital Stock (other than directors' qualifyingshares or Capital Stock of the Borrower); or

(b) any property or assets (other than cash, CashEquivalents or Capital Stock) of the Borrower or any Restricted Subsidiary;

Notwithstanding the preceding, the following items will not bedeemed to be Asset Sales:

(i) the disposition of all or substantially all of theassets of the Borrower and its Restricted Subsidiaries as permitted under Section5.15;

(i) a disposition of inventory or obsolete or worn-outequipment in the ordinary course of business;

(ii) dispositions of assets in any fiscal year with aFair Market Value not to exceed $5 million in the aggregate;

(iii) a disposition to the Borrower or a RestrictedSubsidiary (other than a Permitted Joint Venture), including a Person that isor will become a Restricted Subsidiary immediately after the disposition;

(iv) the disposition of accounts receivable and relatedassets pursuant to a Qualified Receivables Transaction; and

(v) any foreclosure by any creditor of a Lien permittedunder Section 5.10 on any assets subject thereto; 

(vi) a Collateral Asset Sale; and

(vii) an Event of Loss.

"**Asset Sale Amount**" means, as of any date, the sum of (a)the aggregate purchase price of all Asset Sales consummated by Vitro and itsSubsidiaries on or prior to such date but after the date hereof and (b) theaggregate purchase price to be received by Vitro and its Subsidiaries upon orafter consummation of Asset Sales for which bona fide definitive sale andpurchase agreements have been entered into and are in effect at such date withthird parties unaffiliated with Vitro (except for any affiliation solely as aresult of a joint ownership of a Subsidiary or other joint venture of Vitro andits Subsidiaries or its status as a licensor or licensee). 

"**Asset Sale Offer**" has the meaning assigned to it in Section5.06(b).

"**Asset Sale Offer Amount**" has the meaning assigned to itin Section 5.06(b).

"**Asset Sale Offer Notice**" means notice of an Asset SaleOffer made pursuant to Section 5.06(b), which shall be delivered to each Lenderwithin 20 days following an Asset Sale Offer Trigger Date for the applicationof Net Cash Proceeds of any Asset Sale, with a copy to the AdministrativeAgent, which notice shall govern the terms of the Asset Sale Offer, and shallstate:

(a) the circumstances of the Asset Sale, the Net CashProceeds of which are included in the Asset Sale Offer, that an Asset SaleOffer is being made pursuant to Section 5.06(b);

(b) the Asset Sale Offer Amount and the Asset Sale Offer Payment Date; and

(c) that any Lender electing to have any of its Loansprepaid pursuant to the Asset Sale Offer must specify the principal amount thatis to be prepaid, which principal amount must be $1,000 or an integral multiplethereof.

"**Asset Sale Offer Payment Date**" has the meaning assignedto it in Section 5.06(b).

"**Asset Sale Offer Trigger Date**" has the meaning set forthin Section 5.06(b).

"**Asset Sale Transaction**" means any Asset Sale and,whether or not constituting an Asset Sale, (1) any sale or other disposition ofCapital Stock of a Restricted Subsidiary (other than Capital Stock of theBorrower), and (2) any Designation with respect to an Unrestricted Subsidiary.

"**Assignment**" means an assignment and assumption agreemententered into by a Lender and an assignee (with the consent of any party whoseconsent is required by Section 9.04), and accepted by the Administrative Agent,in the form of Exhibit A or any other form approved by the AdministrativeAgent.

"**Base Rate**" means, for any day, a rate per annum equal tothe greater of (a) the Prime Rate in effect on such day and (b) the FederalFunds Effective Rate in effect on such day plus 1/2 of 1%. Any changein the Base Rate due to a change in the Prime Rate or the Federal FundsEffective Rate will be effective from and including the effective date of suchchange in the Prime Rate or the Federal Funds Effective Rate, respectively.

"**Board of Directors**" means, as to any Person, the boardof directors, management committee or similar governing body of such Person orany duly authorized committee thereof.

"**Board Resolution**" means, with respect to any Person, acopy of a resolution certified by the secretary or an assistant secretary ofsuch Person to have been duly adopted by the Board of Directors of such Personand to be in full force and effect on the date of such certification, anddelivered to the Administrative Agent.

"**Borrower**" means Vitro Envases Norteamerica, S.A. deC.V., a *sociedad anonima de capital variable* organized and existingunder the laws of Mexico.

"**Borrower Debt to EBITDA Ratio**" means, at any time, the ratio,calculated in each case in accordance with Mexican GAAP with respect to the Borrowerand its Subsidiaries on a consolidated basis, of

(1) the aggregate amount of all Indebtedness of the Borrowerand its Subsidiaries that would appear on a consolidated balance sheet of the Borrowerat such time, to

(2) the sum (without duplication) for the most recentlyconcluded Four Quarter Period, of

(A) operating income of the Borrowerand its consolidated Subsidiaries, 

(B) depreciation andamortization of the Borrower and its consolidated Subsidiaries; and

(C) other non-cash items thatare reported above the "operating income (loss)" line on the Borrower'sconsolidated statements of operations applicable to the Borrower and itsRestricted Subsidiaries; *provided* that the amount included in thisclause (C) for any Four Quarter Period will not be less than zero.

  "**Borrowing**"    means the borrowing of Loans hereunder.

"**Business Day**" means any day that is not a Saturday,Sunday or other day on which commercial banks in New York City or Mexico Cityare authorized or required by law or other governmental action to remainclosed; *provided* that, when used in connection with the making orpayment of, or determination of, an Interest Period for a Loan, the term"Business Day" shall also exclude any day on which banks are not open fordealings in dollar deposits in the London interbank market.

"**Capitalized Lease Obligations**" means, as to any Person,the obligations of such Person under a lease that are required to be classifiedand accounted for as capital lease obligations under Mexican GAAP. Forpurposes of this definition, the amount of such obligations at any date will bethe capitalized amount of such obligations at such date, determined inaccordance with Mexican GAAP.

"**Capital Stock**" means:

(1) with respect to any Person that is a corporation, anyand all shares, interests, participations or other equivalents (howeverdesignated and whether or not voting) of corporate stock, including each classof Common Stock and Preferred Stock of such Person;

(2) with respect to any Person that is not a corporation,any and all partnership or other equity or ownership interests of such Person;and

(3) any warrants, rights or options to purchase any of theinstruments or interests referred to in clause (1) or (2) above.

"**Cash Equivalents**" means:

(1) marketable direct obligations issued by, orunconditionally guaranteed by, the United States government or issued by anyagency thereof and backed by the full faith and credit of the United States, ineach case maturing within one year from the date of acquisition thereof;

(2) marketable direct obligations issued by any state ofthe United States or any political subdivision of any such state or any publicinstrumentality thereof maturing within one year from the date of acquisitionthereof and, at the time of acquisition, having one of the two highest ratingsobtainable from either S&P or Moody's or any successor thereto;

(3) commercial paper issued by a corporation (other thanan Affiliate of the Borrower) maturing no more than one year from the date ofcreation thereof and, at the time of acquisition, having a rating of at leastA-1 from S&P or at least P-1 from Moody's;

(4) demand deposits, certificates of deposit, timedeposits or bankers' acceptances maturing within one year from the date ofacquisition thereof issued by any bank organized under the laws of the UnitedStates or any state thereof or the District of Columbia or any U.S. branch of anon-U.S. bank having at the date of acquisition thereof combined capital andsurplus of not less than $500 million (or the equivalent);

(5) repurchase obligations with a term of not more thanseven days for underlying securities of the types described in clause (1) aboveentered into with any bank meeting the qualifications specified in clause (4)above; 

(6) *Certificados de la Tesoreria de la Federacion*(Cetes), *Bonos de Desarrollo del Gobierno Federal* (Bondes) or *BonosAjustables del Gobierno Federal* (Ajustabonos), in each case, issued by thegovernment of Mexico and maturing not later than one year after the acquisitionthereof;

(7) any other instruments issued or guaranteed by thegovernment of Mexico and denominated and payable in Pesos, UDIs or dollars, andmaturing not later than one year after the acquisition thereof;

(8) solely with respect to any Investment by a RestrictedSubsidiary that is not organized under the laws of Mexico, instruments issuedor guaranteed by the national government of the country in which suchRestricted Subsidiary is organized, denominated and payable either in the localcurrency of such jurisdiction or in dollars and maturing not later than oneyear after the acquisition thereof;

(9) investments in money market funds which investsubstantially all of their assets in securities of the types described inclauses (1) through (5) above; and 

(10) demand deposits, certificates of deposit, time depositsand bankers' acceptances maturing not more than 180 days (or 365 days in thecase of clause (A)(I) or (B)(I)) after the acquisition thereof 

(A) denominated in Pesos andissued by (I) any of the five top-rated banks (as evaluated by anyinternationally recognized rating agency) organized under the laws of Mexico orany other state thereof, or (II) any such bank which at the date of acquisitionis a lender to or has made available a line of credit to (in each case in anamount equal to or greater than the amount of the proposed acquisition) theBorrower or any of its Restricted Subsidiaries,

(B) in any jurisdiction otherthan Mexico where the Borrower or any of its Restricted Subsidiaries conductsbusiness and issued by (I) one of the three largest banks doing business insuch jurisdiction, or (II) any such bank in such jurisdiction which at the dateof acquisition is a lender to or has made available a line of credit to (ineach case in an amount equal to or greater than the amount of the proposedacquisition) the Borrower or any of its Restricted Subsidiaries,

(C) issued by any bank which atthe date of acquisition is a lender to or has made available a line of creditto the Borrower or any of its Restricted Subsidiaries and which is not underintervention, receivership or any similar arrangement at the time ofacquisition; provided that the aggregate amount of all such demand deposits,certificates of deposit, time deposits and bankers' acceptances acquired inaccordance with this clause (C) does not exceed $50 million at any one time or

(D) issued by any bank which atthe date of acquisition has an outstanding loan to the Borrower or any of itsRestricted Subsidiaries in an aggregate principal amount at least equal to theaggregate principal amount of such demand deposit, certificate of deposit, timedeposit or bankers' acceptance.

"**Change in Law**" means (a) the adoption of any law, ruleor regulation after the date of this Agreement, (b) any change in any law, ruleor regulation or in the interpretation or application thereof by anyGovernmental Authority after such date or (c) compliance by any Lender (or, forpurposes of Section 2.09(b), by any lending office of such Lender or by suchLender's holding company, if any) with any request, guideline or directive(whether or not having the force of law) of any Governmental Authority made orissued after such date.

"**Change of Control**" means:

(1) any "person" or "group" (as such terms are used forpurposes of Sections 13(d) and 14(d) of the Exchange Act, whether or notapplicable, except that for purposes of this clause (1) such person or groupshall be deemed to have "beneficial ownership" of all shares that such personor group has the right to acquire, whether such right is exercisableimmediately or only after the passage of time), excluding Permitted Holders, isor becomes the "beneficial owner" (as such term is used in Rule 13d-3promulgated pursuant to the Exchange Act), directly or indirectly, of more than35% of the aggregate voting power of the Voting Stock of Vitro;

(2) individuals who on the Effective Date constituted theBoard of Directors of Vitro (together with any new director whose election bysuch Board or whose nomination for election by the stockholders of Vitro wasapproved by a majority of the directors of Vitro then still in office who wereeither directors on the Effective Date or whose election or nomination forelection was previously so approved) cease for any reason to constitute amajority of the Board of Directors of Vitro then in office;

(3) Vitro consolidates with, or merges with or into,another Person, other than a transaction where the Person or Persons that,immediately prior to such transaction are the "beneficial owners" in theaggregate of a majority of the total voting power of the then outstandingVoting Stock of Vitro are, by virtue of such prior ownership, the "beneficialowners" in the aggregate of a majority of the total voting power of the thenoutstanding Voting Stock of the surviving Person (or if such surviving Personis a direct or indirect Wholly Owned Subsidiary of another Person, such Personwho is the ultimate parent entity), in each case whether or not suchtransaction is otherwise in compliance with this Agreement; or

(4) the Borrower will cease to be a Subsidiary of Vitrothat is consolidated under Mexican GAAP in its consolidated financialstatements.

"**CNBV**" means the National Banking and SecuritiesCommission (*Comision Nacional Bancaria y de Valores*) of Mexico or any entity succeeding to any or all of its functions.

  "**Collateral    Asset Sale**" has the meaning set forth in the Existing Senior Note Indenture    as in effect on the date hereof.

  "**Comegua**"    means Empresas Comegua, S.A., a Panamanian corporation.

  "**Commitment**"    means, with respect to each Lender, the commitment of such Lender to make    a Loan on the Effective Date, expressed as an amount representing the maximum    principal amount of such Loan. The initial amount of each Lender's Commitment    is set forth on Schedule 2.01, or in the Assignment pursuant to which such    Lender shall have assumed its initial Commitment, as applicable. The initial    aggregate amount of the Commitments is US$105 million.

"**Commodity Agreement**" of any Person means any commodityfutures contract, commodity option or other similar agreement or arrangementdesigned to protect against fluctuations in the price of commodities used bysuch Person.

"**Common Stock**" of any Person means any and all shares,interests or other participations in, and other equivalents (however designatedand whether voting or non-voting) of such Person's common equity interests,whether outstanding on the Effective Date or issued thereafter, and includes,without limitation, all series and classes of such common equity interests.

"**Consolidated EBITDA**" means for any Person for any periodthe sum of the amounts for such period of Consolidated Net Income, *plus*,or *minus*, as the case may be, for such Person without duplication, tothe extent such amount was deducted or added, as the case may be, incalculating Consolidated Net Income.

(1) Consolidated Interest Expense, *plus*

(2) income andasset taxes and workers' profit sharing other than income taxes (eitherpositive or negative) attributable to extraordinary gains or losses or to gainsor losses on sales of assets), *plus*

(3) depreciation expense, *plus*

(4) amortization expense, *plus*

(5) non-cashextraordinary losses, non-cash foreign exchange losses, non-cash monetarylosses and other non-cash expenses or losses of such Person and itsSubsidiaries (its Restricted Subsidiaries in the case of the Borrower orComegua) for such period, that are reported below the "operating income (loss)"line on such Person's consolidated statements of operations (other than itemsthat will require cash payments and for which an accrual or reserve is, or isrequired by Mexican GAAP to be, made), *plus or minus*

(6) non-cashwrite-offs or writeups of assets, *plus*

(7) extraordinarynon-recurring severance payments to employees, *plus*

(8) non-cashitems related to pension plan liabilities, *less*

(9) non-cashextraordinary gains, non-cash foreign exchange gains, non-cash monetary gainsand other non-cash credits and gains of such Person and its Subsidiaries (itsRestricted Subsidiaries in the case of the Borrower or Comegua) for such periodthat are reported below the "operating income (loss)" line on such Person'sconsolidated statements of operations (other than (A) items that will result inthe receipt of cash payments and (B) items resulting from the reversal of anitem anticipated to require cash payments for which an accrual or reserve was,or was required by Mexican GAAP to be, made, to the extent such item wasdeducted from the calculation of Consolidated EBITDA pursuant to clause (7)above),

all as determined on a consolidated basis for suchPerson and its Subsidiaries (Restricted Subsidiaries in the case of theBorrower or Comegua) in conformity with Mexican GAAP.

"**Consolidated Fixed Charge Coverage Ratio**"means, for any Person as of any date of determination, the ratio of theaggregate amount of Consolidated EBITDA of such Person for the four most recentfull fiscal quarters for which financial statements are available ending priorto the date of such determination (the "**Four Quarter Period**") to Consolidated FixedCharges for such Person for such Four Quarter Period. For purposes of thisdefinition, "Consolidated EBITDA" and "Consolidated Fixed Charges" will becalculated after giving effect on a pro forma basis in accordance withRegulation S-X under the Securities Act for the period of such calculation to:

(1) the Incurrence, repayment (excluding revolving creditborrowings Incurred or repaid for working capital purposes) or redemption ofany Indebtedness (including Acquired Indebtedness) or Preferred Stock of suchPerson or any of its Subsidiaries (Restricted Subsidiaries, in the case of theBorrower or Comegua), and the application of the proceeds thereof, includingthe Incurrence of any Indebtedness (including Acquired Indebtedness) orPreferred Stock, and the application of the proceeds thereof, giving rise tothe need to make such determination, occurring during such Four Quarter Periodor at any time subsequent to the last day of such Four Quarter Period and on orprior to such date of determination, to the extent, in the case of anIncurrence, such Indebtedness is outstanding on the date of determination, asif such Incurrence, and the application of the proceeds thereof, repayment orredemption occurred on the first day of such Four Quarter Period; and

(2) any Asset Sale Transaction or Asset Acquisition bysuch Person or any of its Subsidiaries (Restricted Subsidiaries, in the case ofthe Borrower or Comegua), including any Asset Sale or Asset Acquisition givingrise to the need to make such determination, occurring during the Four QuarterPeriod or at any time subsequent to the last day of the Four Quarter Period andon or prior to such date of determination, as if such Asset Sale Transaction orAsset Acquisition occurred on the first day of the Four Quarter Period.

Furthermore, in calculating "Consolidated Fixed Charges" forpurposes of determining the denominator (but not the numerator) of this"Consolidated Fixed Charge Coverage Ratio,"

(a) interest on outstanding Indebtedness determined on afluctuating basis as of the date of determination and which will continue to beso determined thereafter will be deemed to have accrued at a fixed rate perannum equal to the rate of interest on such Indebtedness in effect on such dateof determination;

(b) if interest on any Indebtedness actually Incurred onsuch date of determination may optionally be determined at an interest ratebased upon a factor of a prime or similar rate, a eurocurrency interbankoffered rate, or other rates, then the interest rate in effect on such date ofdetermination will be deemed to have been in effect during the Four QuarterPeriod; and

(c)    notwithstanding clause (a) above, interest on Indebtedness determined on a    fluctuating basis, to the extent such interest is covered by Hedging Obligations,    will be deemed to accrue at the rate per annum resulting after giving effect    to the operation of the agreements evidencing such Hedging Obligations.

"**Consolidated Fixed Charges**" means, for any Person forany period, the sum, without duplication, of:

(1) ConsolidatedInterest Expense for such Person, *plus*

(2) the productof:

(a) the amount ofall cash and non-cash dividend payments on any series of Preferred Stock orDisqualified Capital Stock of such Person and its Subsidiaries (RestrictedSubsidiaries in the case of the Borrower or Comegua) paid, accrued or scheduledto be paid or accrued during such period (other than dividends paid, accrued orscheduled to be paid or accrued in Qualified Capital Stock or to such Personand its Subsidiaries (Restricted Subsidiaries in the case of the Borrower orComegua) *times*

(b) a fraction,the numerator of which is one and the denominator of which is one minus thethen current effective Mexican tax rate of the Borrower, expressed as adecimal.

"**Consolidated Interest Expense**" means, for any Person forany period, the sum of, without duplication determined on a consolidated basisin accordance with Mexican GAAP:

(1) the aggregate of cash and non-cash interest expense ofsuch Person and its Subsidiaries (Restricted Subsidiaries in the case of the Borroweror Comegua) for such period determined on a consolidated basis in accordancewith Mexican GAAP, including, without limitation (whether or not interestexpense in accordance with Mexican GAAP):

(a) any amortizationor accretion of debt discount or any interest paid on Indebtedness of suchPerson and its Subsidiaries (Restricted Subsidiaries in the case of the Borroweror Comegua) in the form of additional Indebtedness,

(b) any amortizationof deferred financing costs,

(c) the net costsunder Interest Rate Agreements or Currency Agreements (including amortizationof fees),

(d) all capitalizedinterest,

(e) the interestportion of any deferred payment obligation,

(f) commissions,discounts and other similar fees and charges Incurred in respect of letters ofcredit or bankers' acceptances, and

(g) any interestexpense on Indebtedness of another Person that is Guaranteed by such Person orone of its Subsidiaries (Restricted Subsidiaries in the case of the Borrower orComegua) or secured by a Lien on the assets of such Person or one of itsSubsidiaries (Restricted Subsidiaries in the case of the Borrower or Comegua),whether or not such Guarantee or Lien is called upon;

(2) the interest component of Capitalized LeaseObligations paid, accrued and/or scheduled to be paid or accrued by such Personand its Subsidiaries (Restricted Subsidiaries in the case of the Borrower orComegua) during such period. 

"**Consolidated Net Income**" means with respect to anyPerson for any period, the aggregate net income (or loss) of such Person andits Subsidiaries for such period on a consolidated basis determined inconformity with Mexican GAAP; *provided*that the following items shall beexcluded in computing Consolidated Net Income (without duplication):

(1) net after-tax gains (or losses) from Asset SaleTransactions or abandonments or reserves relating thereto;

(2) net after-tax items classified as extraordinary gains(or losses);

(3) for purposes of calculating Consolidated Net Incomepursuant to Section 5.05(d)(3) only, the net income (or loss) of:

(a) any Personacquired in a "pooling of interests" transaction accrued prior to the date itbecomes a Restricted Subsidiary or is merged or consolidated with the Borroweror any Restricted Subsidiary; or

(b) a SuccessorBorrower (other than the Borrower or a Restricted Subsidiary) prior to assumingthe Borrower's obligations under the Loan Documents pursuant to Section 5.15.

(4) the net income (but not loss) of any Subsidiary ofsuch Person (Restricted Subsidiary in the case of the Borrower) to the extentthat the declaration or payment of dividends or similar distributions by suchSubsidiary is not, during such period, permitted by such Subsidiary's charteror by-laws or any law, regulation, agreement or judgment applicable to any suchdeclaration or payment of dividends or similar distribution;

(5) the net income (or loss) of any Person other than suchPerson and its Subsidiaries (Restricted Subsidiaries in the case of theBorrower);

(6) any restoration to income of any contingency reserve,except to the extent that provision for such reserve was made out of ConsolidatedNet Income accrued at any time following the Effective Date; and

(7) the cumulative effect of changes in accountingprinciples.

"**Consolidated Net Worth**" means, for any Person at anytime, the consolidated stockholders' equity of such Person at such time,determined on a consolidated basis in accordance with Mexican GAAP, less(without duplication) amounts attributable to Disqualified Capital Stock ofsuch Person.

  "**Credit    Parties**" means the Borrower and the Guarantors.

"**Currency Agreement**" means, in respect of any Person, anyforeign exchange contract, currency swap agreement or other similar agreementas to which such Person is a party designed to hedge foreign currency risk ofsuch Person.

  "**Default**"    means any event or condition which constitutes an Event of Default or which    upon notice, lapse of time or both would, unless cured or waived, become an    Event of Default.

  "**Designation**" and "**Designation Amount**" have the meanings set forth in Section 5.08.

  "**Disqualified    Capital Stock**" means that portion of any Capital Stock which, by its terms    (or by the terms of any security into which it is convertible or for which    it is exchangeable at the option of the holder thereof), or upon the happening    of any event, matures or is mandatorily redeemable, pursuant to a sinking    fund obligation or otherwise, or is redeemable at the sole option of the holder    thereof, in any case, on or prior to the 91st day after the final maturity    date of the Loans. Notwithstanding the foregoing, the following shall not    constitute Disqualified Capital Stock:

(a) any Capital Stock that would not constituteDisqualified Capital Stock but for provisions thereof giving holders thereofthe right to require the Borrower to repurchase or redeem such Capital Stockupon the occurrence of any "asset sale" or "change of control" occurring priorto the 91st day after the final maturity of the Existing Senior Notes if the "asset sale" or"change of control" provisions applicable to such Capital Stockare not more favorable to the holders of such Capital Stock than the provisionscontained in Section 5.06 and

(b) Capital Stock shall not be deemed to be DisqualifiedCapital Stock if it may only be so redeemed solely in consideration of CapitalStock that is not Disqualified Capital Stock.

  "**Dollars**", "**US$**" or "**$**" refers to lawful money of the United States.

"**Effective Date**" means the date on which each of theconditions specified in Section 4.01 is satisfied (or waived in accordance withSection 9.02).

  "**Environmental    Laws**" has the meaning specified in Section 3.15.

"**Environmental Liability**"****means any liability,contingent or otherwise (including any liability for damages, costs ofremediation, fines, penalties or indemnities), of the Borrower and/or theGuarantors directly or indirectly resulting from or based on violation of anyEnvironmental Law.

  "**Event    of Loss**" has the meaning set forth in the Existing Senior Note Indenture    as in effect on the date hereof.

  "**Events    of Default**" has the meaning specified in Article 6.

  "**Exchange    Act**" means the U.S. Securities Exchange Act of 1934, as amended, or any    successor statute or statutes thereto.

"**Existing Credit Facility**" means the Amended and RestatedLoan Agreement dated as of February 24, 2005, among the Borrower, theGuarantors referred to therein, the Lenders party thereto and Credit Suisse,acting through its Cayman Islands Branch, as Administrative Agent.

"**Existing Senior Note Indenture**" means the Indenturedated as of July 23, 2004 between the Borrower and Bank of New York, asTrustee, as supplemented by the Supplemental Indenture No. 1 thereto dated asof February 7, 2005.

  "**Existing    Senior Note Indenture Date**" means July 23, 2004.

"**Existing Senior Notes**" means the Borrower's US$250million aggregate principal amount of 10.75% Senior Secured Guaranteed Notesdue 2011 issued under the Existing Senior Note Indenture.

"**Fair Market Value**" means, with respect to any asset, theprice (after taking into account any liabilities relating to such assets) whichcould be negotiated in an arm's-length free market transaction, for cash,between a willing seller and a willing and able buyer, neither of which isunder any compulsion to complete the transaction; provided, that the FairMarket Value of any such asset or assets will be determined conclusively by theBoard of Directors of the Borrower acting in good faith, and will be evidencedby a Board Resolution.

"**Federal Funds Effective Rate**" means, for any day, theweighted average of the rates on overnight Federal funds transactions withmembers of the Federal Reserve System arranged by Federal funds brokers, aspublished on the next succeeding Business Day by the Federal Reserve Bank ofNew York, or, if such rate is not so published on such Business Day, theaverage of the quotations for such day for such transactions received by theAdministrative Agent from three Federal funds brokers of recognized standingselected by it.

"**Federal Reserve Board**" means the Board of Governors ofthe Federal Reserve System of the United States.

"**Four Quarter Period**" has the meaning set forth in thedefinition of Consolidated Fixed Charge Coverage Ratio above.

"**Governmental Authority**" means the executive, legislativeand judicial branches of power of Mexico or any political subdivision thereof,the government of Mexico or any political subdivision thereof, or thegovernment of any other nation or any political subdivision thereof, whether stateor local, and any agency, authority, instrumentality, regulatory body, court,central bank or other entity exercising executive, legislative, judicial,taxing, regulatory or administrative powers or functions of or pertaining togovernment (including, without limitation, the United States Federal ReserveBoard, *Banco de Mexico*, the CNBV and IPAB).

"**Guarantee**" means any obligation, contingent orotherwise, of any Person directly or indirectly guaranteeing any Indebtednessof any other Person and, without limiting the generality of the foregoing, anyobligation, direct or indirect, contingent or otherwise, of such Person:

(a) to purchase or pay, or advance or supply funds for thepurchase or payment of, such Indebtedness of such other Person, whether arisingby virtue of partnership arrangements, or by agreement to keep-well, topurchase assets, goods, securities or services, to take-or-pay, or to maintainfinancial statement conditions or otherwise, or

(b) entered into for purposes of assuring in any othermanner the obligee of such Indebtedness of the payment thereof or to protectsuch obligee against loss in respect thereof, in whole or in part, 

*provided*, that "Guarantee" will not includeendorsements for collection or deposit in the ordinary course of business. "Guarantee" used as a verb has a corresponding meaning.

"**Guarantor**" means each Subsidiary listed on the signaturepages hereof under the caption "Guarantors" and each Subsidiary that shall, atany time after the Effective Date, become a "Guarantor" hereunder.

"**Hedging Obligations**" means the obligations of any Personpursuant to any Interest Rate Agreement, Currency Agreement or CommodityAgreement.

"**IMSS**" means the *Instituto Mexicano del Seguro Social*.

"**Incur**" means, with respect to any Indebtedness or otherobligation of any Person, to create, issue, incur (including by conversion,exchange or otherwise), assume, Guarantee or otherwise become liable in respectof such Indebtedness or other obligation on the balance sheet of such Person(and "Incurrence," "Incurred" and "Incurring" will have meanings correlative tothe preceding).

"**Indebtedness**" means with respect to any Person, withoutduplication (but excluding Trade Payables):

(a) the principal amount (or, if less, the accreted value)of all obligations of such Person for borrowed money;

(b) the principal amount (or, if less, the accreted value)of all obligations of such Person evidenced by bonds, debentures, Loans orother similar instruments;

(c) all Capitalized Lease Obligations of such Person;

(d) all obligations of such Person issued or assumed asthe deferred purchase price of property, all conditional sale obligations andall obligations under any title retention agreement;

(e) all letters of credit, banker's acceptances or similarcredit transactions, including reimbursement obligations in respect thereof;

(f) Guarantees and other contingent obligations of such Person in respect of Indebtedness    referred to in clauses (a) through (e) above and clauses (h) through (i) below;

(g)    all Indebtedness of any other Person of the type referred to in clauses (a)    through (f) which is secured by any Lien on any property or asset of such    Person, the amount of such Indebtedness being deemed to be the lesser of the    Fair Market Value of such property or asset or the amount of the Indebtedness    so secured;

(h) all obligations under Hedging Obligations of suchPerson; and

(i) all Disqualified Capital Stock issued by such Personwith the amount of Indebtedness represented by such Disqualified Capital Stockbeing equal to the greater of its voluntary or involuntary liquidationpreference and its maximum fixed repurchase price, but excluding accrueddividends, if any; provided, that:

(i) if the Disqualified CapitalStock does not have a fixed repurchase price, such maximum fixed repurchaseprice will be calculated in accordance with the terms of the DisqualifiedCapital Stock as if the Disqualified Capital Stock were purchased on any dateon which Indebtedness will be required to be determined pursuant to theAgreement, and

(ii) if the maximum fixedrepurchase price is based upon, or measured by, the fair market value of theDisqualified Capital Stock, the fair market value will be the Fair Market Valuethereof.

"**Independent Financial Advisor**" means an accounting firm,appraisal firm, investment banking firm or consultant of nationally recognizedstanding that is, in the judgment of the Borrower's Board of Directors,qualified to perform the task for which it has been engaged and which is independentin connection with the relevant transaction.

"**INFONAVIT**" means the *Instituto del Fondo Nacional dela Vivienda para los Trabajadores* of Mexico.

"**Interest Period**" means (i) in the case of the InterestPeriod commencing on the Effective Date, the period commencing on the EffectiveDate and ending on the date falling three months thereafter and (ii) for eachsubsequent Interest Period, the period commencing on the last date of theInterest Period then ending and ending on the date falling three monthsthereafter, provided that any Interest Period which would otherwiseexpire on a day that is not a Business Day shall expire on the immediatelypreceding Business Day, and providedfurther, that no InterestPeriod shall end after the Maturity Date.

"**Interest Rate Agreement**" of any Person means anyinterest rate protection agreement (including, without limitation, interestrate swaps, caps, floors, collars, derivative instruments and similaragreements) and/or other types of hedging agreements designed to hedge interestrate risk of such Person.

"**Investment**" means, with respect to any Person, any:

(a) direct or indirect loan, advance or other extension ofcredit (including, without limitation, a Guarantee) to any other Person,

(b) capital contribution (by means of any transfer of cashor other property to others or any payment for property or services for theaccount or use of others) to any other Person, or

(c) any purchase or acquisition by such Person of anyCapital Stock, bonds, Loans, debentures or other securities or evidences ofIndebtedness issued by, any other Person.

"Investment" will exclude accounts receivable ordeposits arising in the ordinary course of business. "Invest," "Investing" and "Invested" will have corresponding meanings.

For purposes of Section 5.05, the Borrower will be deemed tohave made an "Investment" in an Unrestricted Subsidiary at the time of itsDesignation, which will be valued at the Fair Market Value of the sum of thenet assets of such Unrestricted Subsidiary at the time of its Designation andthe amount of any Indebtedness of such Unrestricted Subsidiary owed to theBorrower or any Restricted Subsidiary immediately following such Designation. Any property transferred to or from an Unrestricted Subsidiary will be valuedat its Fair Market Value at the time of such transfer. If the Borrower or anyRestricted Subsidiary sells or otherwise disposes of any Capital Stock of aRestricted Subsidiary (including any issuance and sale of Capital Stock by aRestricted Subsidiary) such that, after giving effect to any such sale ordisposition, such Restricted Subsidiary would cease to be a Subsidiary of theBorrower, the Borrower will be deemed to have made an Investment on the date ofany such sale or disposition equal to sum of the Fair Market Value of theCapital Stock of such former Restricted Subsidiary held by the Borrower or anyRestricted Subsidiary immediately following such sale or other disposition andthe amount of any Indebtedness of such former Restricted Subsidiary Guaranteedby the Borrower or any Restricted Subsidiary or owed to the Borrower or anyother Restricted Subsidiary immediately following such sale or otherdisposition.

"**Investment Return**" means, in respect of any Investment(other than a Permitted Investment) made after the Effective Date by theBorrower or any Restricted Subsidiary:

(a) the cash proceeds received by the Borrower upon thesale, liquidation, repayment or return (in the form of a dividend or otherwise)of such Investment or, in the case of a Guarantee, the amount of the Guaranteeupon the unconditional release of the Borrower and its Restricted Subsidiariesin full, less any payments previously made by the Borrower or any RestrictedSubsidiary in respect of such Guarantee;

(b) in the case of the Revocation of the Designation of anUnrestricted Subsidiary, an amount equal to the lesser of:

(i) the Borrower's Investment insuch Unrestricted Subsidiary at the time of such Revocation;

(ii) that portion of the FairMarket Value of the net assets of such Unrestricted Subsidiary at the time ofRevocation that is proportionate to the Borrower's equity interest in suchUnrestricted Subsidiary at the time of Revocation; and

(iii) the Designation Amount withrespect to such Unrestricted Subsidiary upon its Designation which was treatedas a Restricted Payment; and

(c) in the event the Borrower or any Restricted Subsidiarymakes any Investment in a Person that, as a result of or in connection withsuch Investment, becomes a Restricted Subsidiary, the existing Investment ofthe Borrower and its Restricted Subsidiaries in such Person,

in the case of each of (a), (b) and (c), up to theamount of such Investment that was treated as a Restricted Payment in Section5.05 less the amount of any previous Investment Return in respect of suchInvestment.

"**IPAB**" means the *Instituto para la Proteccion alAhorro Bancario of Mexico*.

"**Lender Affiliate**" means, (a) with respect to any Lender,(i) an Affiliate of such Lender or (ii) any entity (whether a corporation,partnership, trust or otherwise) that is engaged in making, purchasing, holdingor otherwise investing in bank loans and similar extensions of credit in theordinary course of its business and is administered or managed by such Lenderor an Affiliate of such Lender and (b) with respect to any Lender that is afund which invests in bank loans and similar extensions of credit, any otherfund that invests in bank loans and similar extensions of credit and is managedby the same investment advisor as such Lender or by an Affiliate of suchinvestment advisor.

"**Lender Parties**" means the Lenders and the AdministrativeAgent.

"**Lenders**" means each of the Persons listed on thesignature pages hereto (other than the Credit Parties and the AdministrativeAgent, in its capacity as such), and any other Person that shall have become aparty hereto pursuant to an Assignment, other than any such Person that ceasesto be a party hereto pursuant to an Assignment.

"**LIBOR**" means, for any Interest Period, the rate perannum determined by the Administrative Agent at approximately 11:00 a.m.(London time) on the date that is two Business Days prior to the beginning ofthe relevant Interest Period (or in the case of the first Interest Period, onsuch first day) by reference to the British Bankers' Association InterestSettlement Rates for deposits in Dollars (as set forth by the BloombergInformation Service or any successor thereto or any other service selected bythe Administrative Agent which has been nominated by the British Bankers'Association as an authorized information vendor for the purpose of displayingsuch rates) for a period equal to such Interest Period; *provided* that,to the extent that an interest rate is not ascertainable pursuant to theforegoing provisions of this definition, "LIBOR" shall be the interest rate perannum determined by the Administrative Agent to be the average of the rates perannum at which deposits in Dollars are offered for such relevant InterestPeriod to major banks in the London interbank market in London, England by theAdministrative Agent at approximately 11:00 a.m. (London time) on the date thatis two Business Days prior to the beginning of such Interest Period;*provided, further*, that for the initial Interest Period commencing on theEffective Date, "LIBOR" means the rate determined as provided above atapproximately 11:00 a.m. (London time) on the date that is one Business Dayprior to the Effective Date or on the Effective Date, whichever is higher.

"**Lien**" means any lien, mortgage, deed of trust, pledge,security interest, charge or encumbrance of any kind (including any conditionalsale or other title retention agreement, any lease in the nature thereof andany agreement to give any security interest); provided that the lessee inrespect of a Capitalized Lease Obligation or Sale and Leaseback Transactionwill be deemed to have Incurred a Lien on the property leased thereunder.

"**Loan Documents**" means thisAgreement, the Notes and the Additional Interest Letter, and all otheragreements, instruments, documents and certificates executed, by or on behalf ofthe Borrower and delivered concurrently herewith or at any time hereafter to orfor the benefit of the Administrative Agent and/or any of the Lenders inconnection with the transactions contemplated by this Agreement, as the same maybe amended, amended and restated, supplemented or otherwise modified, renewed orextended from time to time. 

"**Loan Guarantee**" means, for any Guarantor, the Guaranteeof the Borrower's Obligations under the Loans and this Agreement provided by suchGuarantor pursuant to Article 8 of this Agreement.

"**Loans**" means loans made by the Lenders to the Borrowerpursuant to Section 2.01 of this Agreement.

"**Material Adverse Effect**" means a material adverse effecton (a) the business, assets, liabilities (actual or contingent), operations,prospects or condition (financial or otherwise) of the Borrower and its Subsidiaries,taken as a whole, (b) the ability of any Credit Party to perform any of itsobligations under any Loan Document or (c) the rights of or benefits availableto any Lender Party under any Loan Document.

"**Material Indebtedness**" means Indebtedness (other thanobligations in respect of the Loans) of the Borrower or any of its Subsidiariesin an aggregate principal amount exceeding $25 million. For purposes ofdetermining Material Indebtedness, the "principal amount" of the HedgingObligations of the Borrower or any of its Subsidiaries at any time will be themaximum aggregate amount (after giving effect to any netting agreements) thatthe Borrower or any of its Subsidiaries would be required to pay if suchHedging Agreement were terminated at such time.

"**Maturity Date**" means the date that correspondsnumerically to the Effective Date in the 18th month thereafter, *provided*that if such date is not a Business Day, the Maturity Date shall be theimmediately preceding Business Day.

"**Mexican GAAP**" means generally accepted accountingprinciples in Mexico that are in effect as of the date of the issuance of theExisting Senior Notes.

"**Mexico**" means the United Mexican States.

  "**Ministry    of Finance**" means the *Secretaria de Hacienda y Credito Publico*of    Mexico.

"**Moody's**" means Moody's Investors Service, Inc.

"**Net Cash Proceeds**" means, with respect to any AssetSale, the proceeds in the form of cash or Cash Equivalents, including paymentsin respect of deferred payment obligations when received in the form of cash orCash Equivalents, received by the Borrower or any of its RestrictedSubsidiaries from such Asset Sale, net of:

(A) reasonable out-of-pocketexpenses and fees relating to such Asset Sale (including, without limitation,legal, accounting and investment banking fees and sales commissions);

(B) taxes paid or payable inrespect of such Asset Sale after taking into account any reduction inconsolidated tax liability due to available tax credits or deductions and anytax sharing arrangements;

(C) repayment of Indebtednessthat is required to be repaid in connection with such Asset Sale; 

(D) solely with respect to suchAsset Sale, appropriate amounts to be provided by the Borrower or anyRestricted Subsidiary, as the case may be, as a reserve, in accordance with MexicanGAAP, against any liabilities associated with such Asset Sale and retained bythe Borrower or any Restricted Subsidiary, as the case may be, after such AssetSale including, without limitation, pension and other post-employment benefitliabilities, liabilities related to environmental matters and liabilities underany indemnification obligations associated with such Asset Sale, but excludingany reserves with respect to Indebtedness; and 

(E) amounts deposited in escrowor under similar arrangements to guarantee indemnification or other obligationsarising in connection with such Asset Sale unless and until such amounts arereleased from escrow or such arrangements to the Borrower or any RestrictedSubsidiary.

"**Note**" has the meaning assigned to it in Section 2.05(e).

"**Obligations**" means, with respect to any Indebtedness,any principal, interest (including, without limitation, Post-Petition Interestthereon), premium, penalties, fees, indemnifications, reimbursements, damages,and other liabilities payable under the documentation governing suchIndebtedness, including in the case of Loans, all principal of and interest(including, with limitation, Post-Petition Interest) on, and all premiumreferred to in Section 2.04 with respect to, the Loans.

"**Obsolete Equipment**" means any machinery, equipment,furniture, apparatus, tools or implements or other similar property that may bedefective or may have become worn out or obsolete or no longer used or usefulin the operations of the Borrower or its Subsidiaries.

"**Officer**" means the Chairman of the Board, President,Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer orthe Treasurer of the Borrower.

"**Officer's Certificate**" means a certificate duly executedby any two of the Chief Executive Officer, the Chief Financial Officer, theChief Accounting Officer or the Treasurer of the Borrower.

"**Opinion of Counsel**" means a written opinion of counsel,who may be an employee of or counsel for the Borrower and who shall bereasonably acceptable to the Administrative Agent.

"**Other Facilities Collateral Documents**" means the"Collateral Documents" as defined in the Existing Senior Note Indenture ineffect on the date hereof.

"**Participants**" has the meaning specified in Section9.04(d).

"**Permitted Business**" means the business or businessesconducted by the Borrower and its Restricted Subsidiaries as of the EffectiveDate and any business ancillary or complementary thereto.

  "**Permitted    Holders**" means (i) any member of the Board of Directors of Vitro on the    Effective Date, (ii) a parent, brother or sister of any of the individuals    named in clause (i), (iii) the spouse or a former spouse of any individual    named in clause (i) or (ii), (iv) the lineal descendants of any person named    in clauses (i) through (iii) and the spouse or a former spouse of any such    lineal descendant, (v) the estate or any guardian, custodian or other legal    representative of any individual named in clauses (i) through (iv), (vi) any    trust established solely for the benefit of any one or more of the individuals    named in clauses (i) through (v), (vii) any Person in which all of the equity    interests are owned, directly or indirectly, by any one or more of the Persons    named in clauses (i) through (vi), (viii) the Vitro employee stock option    trust and (ix) the Vitro employee pension trust.

"**Permitted Indebtedness**" has the meaning assigned to itin Section 5.03(b). 

"**Permitted Investments**" means:

(a) Investments by the Borrower or any RestrictedSubsidiary in any Person that is, or that results in any Person becoming,immediately after such Investment, a Restricted Subsidiary or constituting amerger or consolidation of such Person into the Borrower or with or into aRestricted Subsidiary;

(b) Investments by any Restricted Subsidiary in theBorrower;

(c) Investments in cash and Cash Equivalents;

(d) any extension, modification or renewal of anyInvestments existing as of the Effective Date (but not Investments involvingadditional advances, contributions or other investments of cash or property orother increases thereof, other than as a result of the accrual or accretion ofinterest or original issue discount or payment-in-kind pursuant to the terms ofsuch Investment as of the Effective Date);

(e) Investments permitted pursuant to Section 5.11(b)(ii)and Section 5.11(b)(v);

(f) Investments received as a result of the bankruptcy orreorganization of any Person or taken in settlement of or other resolution ofclaims or disputes, and, in each case, extensions, modifications and renewalsthereof;

(g) Investments made by the Borrower or its RestrictedSubsidiaries as a result of non-cash consideration permitted to be received inconnection with an Asset Sale made in compliance with Section 5.06;

(h) Investments in the form of Hedging Obligationspermitted under Section 5.03(b)(vii);

(i) Investments made solely in the form of common equityof the Borrower constituting Qualified Capital Stock; 

(j) purchases of Capital Stock of Vitro in an aggregateamount not to exceed $2 million in any calendar year by a stock incentive planfor the benefit of employees of the Borrower and its Subsidiaries; and

(k) other Investments in a Person engaged in a PermittedBusiness not to exceed $10 million at any one time outstanding.

"**Permitted Joint Venture**" means (i) Comegua and itsSubsidiaries for so long as any third party that is not an Affiliate of Vitroshall directly or indirectly own any of its Capital Stock, and (ii) any jointventure or other entity created after the Effective Date that is a RestrictedSubsidiary, the purpose of which is to develop a new production facility foruse in a Permitted Business of the Borrower, a portion of the Capital Stock ofwhich is owned by a third party that is not an Affiliate of Vitro.

"**Permitted Liens**" means any of the following:

(a) statutory Liens of landlords and Liens of carriers,warehousemen, mechanics, suppliers, materialmen, repairmen and other Liensimposed by law incurred in the ordinary course of business for sums not yetdelinquent or being contested in good faith, if such reserve or otherappropriate provision, if any, as shall be required by Mexican GAAP has beenmade in respect thereof;

(b) Liens for taxes, assessments or governmental chargesor levies on the property of the Borrower or any Restricted Subsidiary if thesame shall not at the time be delinquent or thereafter can be paid withoutpenalty, or are being contested in good faith and by appropriate proceedingspromptly instituted and diligently concluded; *provided* that any reserveor other appropriate provision that shall be required in conformity withMexican GAAP shall have been made therefor;

(c) Liens Incurred or deposits made in the ordinary courseof business in connection with workers' compensation, unemployment insuranceand other types of social security, including any Lien securing letters ofcredit issued in the ordinary course of business consistent with past practicein connection therewith, or to secure the performance of tenders, statutoryobligations, surety and appeal bonds, bids, leases, government performance andreturn-of-money bonds and other similar obligations (exclusive of obligationsfor the payment of borrowed money);

(d) Liens upon specific items of inventory or other goodsand proceeds of any Person securing such Person's obligations in respect ofbankers' acceptances issued or created for the account of such Person tofacilitate the purchase, shipment or storage of such inventory or other goods;

(e) Liens encumbering deposits made to secure obligationsarising from statutory, regulatory, contractual, or warranty requirements ofthe Borrower or a Restricted Subsidiary, including rights of offset andset-off; 

(f) Liens existing on the Effective Date;

(g) zoning restrictions, licenses, easements, servitudes,rights of way, title defects, covenants running with the land and other similarcharges or encumbrances or restrictions not interfering in any material respectwith the ordinary operation of the Borrower or a Restricted Subsidiary;

(h) Liens created pursuant to the Other FacilitiesCollateral Documents; 

(i) Liens securing reimbursement obligations with respectto commercial letters of credit which encumber documents and other propertyrelating to such letters of credit and products and proceeds thereof;

(j) Liens securing Hedging Obligations that relate toIndebtedness that is Incurred in accordance with Section 5.03 and that aresecured by the same assets as secure such Hedging Obligations;

(k)    Liens existing on the Effective Date and Liens to secure any Refinancing Indebtedness    which is Incurred to Refinance any Indebtedness which has been secured by    a Lien permitted in Section 5.10 not incurred pursuant to clause (n) below    and which Indebtedness has been Incurred in accordance with Section 5.03;    *provided*, that such new Liens:

(i) are no less favorable to theLenders with respect to their Loans and are not more favorable to the lienholders with respect to such Liens than the Liens in respect of theIndebtedness being Refinanced and

(ii) do not extend to anyproperty or assets other than the property or assets securing the IndebtednessRefinanced by such Refinancing Indebtedness;

(l) Liens securing Acquired Indebtedness Incurred inaccordance with Section 5.03 not incurred in connection with, or inanticipation or contemplation of, the relevant acquisition, merger orconsolidation; *provided*, that

(i) such Liens secured suchAcquired Indebtedness at the time of and prior to the Incurrence of suchAcquired Indebtedness by the Borrower or a Restricted Subsidiary and were notgranted in connection with, or in anticipation of the Incurrence of suchAcquired Indebtedness by the Borrower or a Restricted Subsidiary and

(ii) such Liens do not extend toor cover any property of the Borrower or any Restricted Subsidiary other thanthe property that secured the Acquired Indebtedness prior to the time suchIndebtedness became Acquired Indebtedness of the Borrower or a RestrictedSubsidiary and are no more favorable to the lienholders than the Liens securingthe Acquired Indebtedness prior to the Incurrence of such Acquired Indebtednessby the Borrower or a Restricted Subsidiary;

(m) [Intentionally Omitted];

(n) Liens on accounts receivable and related assetsgranted in connection with a Qualified Receivables Transaction;

(o) Liens on assets or property of Comegua or itsSubsidiaries securing Indebtedness of Comegua or its Subsidiaries; and

(p) Liens securing the obligations of the Borrower or anyRestricted Subsidiary pursuant to agreements for indemnification, adjustment ofpurchase price or similar obligations, or from Guarantees, letters of credit,escrows or other similar instruments, in any case Incurred in connection withthe disposition of any business, assets or Restricted Subsidiary, in aprincipal amount not to exceed the sales price (including the assumption ofIndebtedness) in connection with such disposition.

"**Person**" means any natural person, corporation, limitedliability company, trust, joint venture, association, company, partnership,Governmental Authority or other entity.

"**Post-Petition Interest**" means all interest accrued oraccruing after the commencement of any insolvency, *concurso mercantil* orliquidation proceeding (and interest that would accrue but for the commencementof any insolvency, *concurso mercantil* or liquidation proceeding) inaccordance with and at the contract rate (including, without limitation, anyrate applicable upon default) specified in the agreement or instrumentcreating, evidencing or governing any Indebtedness, whether or not, pursuant toapplicable law or otherwise, the claim for such interest is allowed as a claimin such insolvency, *concurso mercantil* or liquidation proceeding.

"**Preferred Stock**" of any Person means any Capital Stockof such Person that has preferential rights over any other Capital Stock ofsuch Person with respect to dividends, distributions or redemptions or uponliquidation.

"**Prime Rate**" means the rate of interest per annumannounced from time to time by Credit Suisse as its prime rate in effect at itsprincipal office in New York City. Each change in the Prime Rate will beeffective for purposes hereof from and including the date such change isannounced as being effective.

"**Process Agent**" has the meaning set forth in Section 9.09hereof.

"**Qualified Capital Stock**" means any Capital Stock that isnot Disqualified Capital Stock and any warrants, rights or options to purchaseor acquire Capital Stock that is not Disqualified Capital Stock that are notconvertible into or exchangeable into Disqualified Capital Stock.

"**Qualified Receivables Transaction**" means either (i) theaccounts receivable factoring program existing on the Effective Date and anysuccessor receivables facility involving the sale or other transfers of accountsreceivable of the Mexican sales by the Borrower and its Subsidiaries or anyaccounts receivable factoring program involving the sales or other transfers byAlcali of its accounts receivable, the aggregate outstanding amount of whichwill in no event at any time exceed $81 million and (ii) sales or othertransfers by Comegua and its Subsidiaries of its accounts receivable, theaggregate outstanding amount of which will in no event at any time exceed $30million.

"**Refinance**" means, in respect of any Indebtedness, toissue any Indebtedness in exchange for or to refinance, extend, renew, repay,redeem, replace, defease or refund such Indebtedness in whole or in part. "Refinanced" and"Refinancing" will have correlative meanings.

"**Refinancing Indebtedness**" means Indebtedness of theBorrower or any Restricted Subsidiary issued to Refinance any otherIndebtedness of the Borrower or a Restricted Subsidiary so long as:

(a) the aggregate principal amount (or initial accretedvalue, if applicable) of such new Indebtedness as of the date of such proposedRefinancing does not exceed the aggregate principal amount (or accreted valueas of such date, if applicable) of the Indebtedness being Refinanced (plus theamount of any premium required to be paid under the terms of the instrumentgoverning such Indebtedness and the amount of reasonable expenses incurred bythe Borrower in connection with such Refinancing); or 

(b) such new Indebtednesshas: 

(i) a Weighted Average Life toMaturity that is equal to or greater than the Weighted Average Life to Maturityof the Indebtedness being Refinanced, and 

(ii) a final maturity that isequal to or later than the final maturity of the Indebtedness being Refinanced;or

(c) if the Indebtednessbeing Refinanced is:

(i) Indebtedness of theBorrower, then such Refinancing Indebtedness will be Indebtedness of theBorrower, and 

(ii) Subordinated Indebtedness,then such Refinancing Indebtedness will be subordinate to the Loans, ifapplicable, at least to the same extent and in the same manner as theIndebtedness being Refinanced.

"**Register**" has the meaning specified in Section 9.04(c).

"**Related Parties**" means, with respect to any specifiedPerson, such Person's Affiliates and the respective directors, officers, employees,agents and advisors of such Person and its Affiliates.

  The "**Required Consolidated Fixed Charge Ratio**" shall be satisfied as of    any date of determination if on such date, the Consolidated Fixed Charge Ratio    of the Borrower is greater than (x) 2.50 to 1.00, if such date of determination    is on or prior to July 23, 2006 and (B) 2.75 to 1.00, if such date of determination    is after July 23, 2006 but on or prior to the Maturity Date.

"**Required Lenders**" means, at any time, Lenders havingoutstanding Loans representing at least 51% of the sum of all outstanding Loansat such time; provided that, for purposes of the definition of RequiredLenders, any Loans held by Vitro or its Affiliates shall be deemed to not beoutstanding.

"**Restricted Payment**" has the meaning set forth under Section5.05.

"**Restricted Subsidiary**" means any Subsidiary of the Borrowerwhich at the time of determination is not an Unrestricted Subsidiary. When "Restricted Subsidiary" is used with respect to Comegua, it means a Subsidiaryof Comegua that is a Restricted Subsidiary of the Borrower.

"**Revocation**" has the meaning set forth in Section 5.08(c).

"**Sale and Leaseback Transaction**" means any direct orindirect arrangement with any Person or to which any such Person is a partyproviding for the leasing to the Borrower or a Restricted Subsidiary of anyproperty, whether owned by the Borrower or any Restricted Subsidiary at theEffective Date or later acquired, which has been or is to be sold ortransferred by the Borrower or such Restricted Subsidiary to such Person or toany other Person by whom funds have been or are to be advanced on the securityof such Property.

"**S&P**" means Standard & Poor's Ratings Services, adivision of The McGraw-Hill Companies, Inc.

"**SAR**" means *Sistema de Ahorro para el Retiro*.

"**SEC**" means the U.S. Securities and Exchange Commission,or any successor agency thereto with respect to the regulation or registrationof securities.

"**Securities Act**" means the U.S. Securities Act of 1933,as amended.

"**Senior Credit Facilities**" means (i) the Existing CreditFacility and (ii) one or more bank credit facilities of the Borrower or anyGuarantor, which may be guaranteed by one or more Guarantors, with an initialWeighted Average Life to Maturity of at least two years and any other bankcredit facility of the Borrower or any Guarantor, which may be guaranteed byone or more Guarantors, with an initial Weighted Average Life to Maturity of atleast two years replacing or refinancing any such bank credit facilities. 

"**Significant Subsidiary**" means a Subsidiary of theBorrower constituting a "Significant Subsidiary" of the Borrower in accordancewith Rule 1-02(w) of Regulation S-X under the Securities Act in effecton the date hereof, except that all references to 10% in Rule 102(w) arereplaced with 5%. 

"**SOFIVSA**" means Servicios y Operaciones FinancierasVitro, S.A. de C.V., a Wholly Owned Subsidiary of Vitro.

"**Statutory Reserve Adjustment**" means a fraction (expressedas a decimal), the numerator of which is the number one and the denominator ofwhich is the number one minus the aggregate of the maximum reserve percentages(including any marginal, special, emergency or supplemental reserves) expressedas a decimal established by the Federal Reserve Board to which theAdministrative Agent is subject with respect to eurocurrency funding (currentlyreferred to as "Eurocurrency Liabilities" in Regulation D of the FederalReserve Board). Such reserve percentages will include those imposed pursuantto such Regulation D. Loans will be deemed to constitute eurocurrency fundingand to be subject to such reserve requirements without benefit of or credit forproration, exemptions or offsets that may be available from time to time to anyLender under such Regulation D or any comparable regulation. The StatutoryReserve Adjustment will be adjusted automatically on and as of the effectivedate of any change in any applicable reserve percentage.

"**Subordinated Indebtedness**" means, with respect to theBorrower or any Guarantor, any Indebtedness of the Borrower or such Guarantorwhich is expressly subordinated in right of payment to the Loans or suchGuarantor's Guarantee hereunder, as the case may be.

"**Subsidiary**" means, with respect to any Person, any otherPerson (i) of which such Person owns, directly or indirectly, more than 50% ofthe voting power of the other Person's outstanding Voting Stock and (ii) anyother Person that is combined or consolidated in accordance with Mexican GAAPwith such Person for purposes of financial reporting.

"**Taxing Jurisdiction**" has the meaning assigned to it in Section5.14(a).

"**Trade Payables**" means, with respect to any Person, anyaccounts payable owed by such Person arising in the ordinary course of businessin connection with the acquisition of goods or services and required to be paidwithin one year from the date of Incurrence thereof, which constitute accountspayable and are considered current liabilities in accordance with Mexican GAAP.

"**Trustee**" means the party named as the"Trustee" fromtime to time with respect to the Existing Senior Notes under the Indenture therefor.

"**United States**" means the United States of America.

"**Unrestricted Subsidiary**" means any Subsidiary of the BorrowerDesignated as such pursuant to Section 5.08. Any such Designation may berevoked by a Board Resolution of the Borrower, subject to the provisions of Section5.08.

"**U.S. GAAP**" means generally accepted accountingprinciples in the United States that are in effect as of the date of theissuance of the Existing Senior Notes.

"**Vitro**" means Vitro, S.A. de C.V.

"**Vitro Plan**" means Vitro Plan, S.A. de C.V.

"**Vitro Restricted Subsidiary**" means any Subsidiary (otherthan the Borrower and its Subsidiaries) of Vitro that is a "RestrictedSubsidiary" pursuant to the Agreement, dated as of October 22, 2003, betweenVitro and Wachovia Bank National Association with respect to Vitro's 11.75% SeniorLoans due 2013 or the Agreement, dated May 1, 1997, among SOFIVSA, Vitro asguarantor, and Texas Commerce Bank National Association with respect toSOFIVSA's 11 3/8% Loans due 2007, in each case as amended from time to time.

"**Voting Stock**" with respect to any Person, meanssecurities of any class of Capital Stock of such Person entitling the holdersthereof (whether at all times or only so long as no senior class of stock hasvoting power by reason of any contingency) to vote in the election of members ofthe Board of Directors (or equivalent governing body) of such Person.

"**Weighted Average Life to Maturity**" means, when appliedto any Indebtedness at any date, the number of years (calculated to the nearestone-twelfth) obtained by dividing:

(1) the then outstanding aggregate principal amount orliquidation preference, as the case may be, of such Indebtedness into:

(2) the sum of the products obtained by multiplying:

(a) the amountof each then remaining installment, sinking fund, serial maturity or otherrequired payment of principal or liquidation preference, as the case may be,including payment at final maturity, in respect thereof, by

(b) the numberof years (calculated to the nearest one-twelfth) which will elapse between suchdate and the making of such payment.

"**Wholly Owned Restricted Subsidiary**" means any RestrictedSubsidiary that is a Wholly Owned Subsidiary of the Borrower.

"**Wholly Owned Subsidiary**" with respect to any Person, aSubsidiary of which all of the outstanding Capital Stock of which (other than,in the case of a Restricted Subsidiary not organized in the United States,directors' qualifying shares or an immaterial amount of shares required to beowned by other Persons pursuant to applicable law) is owned by such Person orany other Person that satisfies the definition of Wholly Owned Subsidiary withrespect to such Person.

 

Section 1.02*. Terms Generally.*The definitions of terms herein (including those incorporated by reference toanother document) apply equally to the singular and plural forms of the termsdefined. Whenever the context may require, any pronoun includes thecorresponding masculine, feminine and neuter forms. The words "**include**","**includes**" and "**including**" shall be deemed to be followed by thephrase "**without limitation**". The word "**will**" shall be construed tohave the same meaning and effect as the word "**shall**". Unless thecontext requires otherwise, (a) 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), (b) any referenceherein to any Person shall be construed to include such Person's successors andassigns, (c) the words "**herein**", "**hereof**" and "**hereunder**",and words of similar import, shall be construed to refer to this Agreement inits entirety and not to any particular provision hereof, (d) all referencesherein to Articles, Sections, Exhibits and Schedules shall be construed torefer to Articles and Sections of, and Exhibits and Schedules to, thisAgreement and (e) the words "asset" and "property" shall be construed to havethe same meaning and effect and to refer to any and all tangible and intangibleassets and properties, including cash, securities, accounts and contractrights. Any definition of a term defined by reference to or incorporated byreference from the Existing Senior Note Indenture or the Existing CreditFacility is used as such definition is included in the such agreement as ineffect on the date of this Agreement (including other defined terms used insuch definition), without giving effect to any amendment or modificationthereof except with the prior written approval of the Required Lenders andCredit Parties.

 

Section1.03*. Accounting Terms; Changes in GAAP.*Except as otherwise expresslyprovided herein, all terms of an accounting or financial nature shall beconstrued in accordance with Mexican GAAP.

 

**Article 2    The Credits**

   

Section 2.01*. Commitments.*(a)    *The Loans*. Subject to the terms and conditions set forth herein, each    Lender agrees to make a loan to the Borrower on the Effective Date in a principal    amount equal to its Commitment. Amounts repaid in respect of Loans may not    be reborrowed. The Commitments of the Lenders are several, *i.e.*, the    failure of any Lender to make any Loan required to be made by it shall not    relieve any other Lender of its obligations hereunder, and no Lender shall    be responsible for any other Lender's failure to make Loans as and when required    hereunder.

   

(b)*Termination of the Commitments    on the Effective Date*. Unless previously terminated, the Commitments    will terminate on the Effective Date immediately after the Borrowing (if any)    hereunder.

   

Section 2.02*. Request to Borrow.*To request theBorrowing, the Borrower shall notify the Administrative Agent of such requestin writing by at least one Business Day before the date of the proposedBorrowing. Such Borrowing Request shall be irrevocable, shall be insubstantially the form as set forth on Exhibit H hereto and shall be signed bythe Borrower. The Borrowing Request shall specify the following information:

 

(i)the aggregate amount of the    Borrowing;

(ii)the date of the Borrowing, which    shall be the Effective Date; and

(iii)the location and number of the    Borrower's account to which funds are to be disbursed, which shall comply    with the requirements of Section 2.03.

  

Promptly after it receives the Borrowing Request in accordancewith this Section, the Administrative Agent shall advise each Lender as to thedetails of such Borrowing Request and the amount of such Lender's Loan to bemade pursuant thereto.

 

Section 2.03*. Funding ofLoans.*(a) Each Lender shall wire theprincipal amount of its Loan in immediately available funds, by 12:00 noon, New York City time, on the date of the Borrowing, to the account of the AdministrativeAgent designated by it for such purpose by notice to the Lenders. TheAdministrative Agent shall make such funds available to the Borrower bypromptly crediting the amounts so received, in like funds, to an account of theBorrower in the United States and designated by the Borrower in the applicableBorrowing Request.

 

(b)Unless the Administrative Agent    receives notice from a Lender before the proposed date of any Borrowing that    such Lender will not make its share of such Borrowing available to the Administrative    Agent, the Administrative Agent may assume that such Lender has made such    share available on such date in accordance with Section 2.03(a) and may, in    reliance on such assumption, make a corresponding amount available to the    Borrower. In such event, if a Lender has not in fact made its share of such    Borrowing available to the Administrative Agent, such Lender and (if such    amount is not made available by such Lender within three Business Days of    the date of such Borrowing) the Borrower severally agree to pay to the Administrative    Agent forthwith on demand such corresponding amount with interest thereon,    for each day from and including the day such amount is made available to the    Borrower to but excluding the date of payment to the Administrative Agent,    at (i) in the case of such    Lender, the greater of the Federal Funds Effective Rate and a rate determined    by the Administrative Agent in accordance with banking industry rules on interbank    compensation (but including the interest rate applicable to the Loans and    the credit risk of the Borrower) or (ii) in the case of the Borrower, the    interest rate applicable to such Loan for such period, *provided* that    nothing in this Section 2.03(b) shall impair the Borrower's rights against    such Lender for failure to make such Lender's Loan. If such Lender pays such    amount to the Administrative Agent, such amount shall constitute such Lender's    Loan included in such Borrowing.

 

Section 2.04. Interest Rate.(a) The Loansshall bear interest for each day, subject to clause (b) of this Section 2.04and to Section 2.08, at a rate equal to (x) Adjusted LIBOR for the then currentInterest Period *plus* (y) the Applicable Margin.

 

(b)Notwithstanding    the foregoing, if any principal of or interest on any Loan or any fee or other    amount payable by the Borrower hereunder is not paid when due, whether at    stated maturity, upon acceleration or otherwise, such amount, while overdue,    shall bear interest, to the extent permitted by law, after as well as before    judgment, at a rate per annum equal to (x) in the case of overdue principal    of any Loan, 2% plus the rate otherwise applicable to such Loan as provided    in the preceding subsections of this Section or (y) in the case of any other    amount, 2% plus the Base Rate plus the Applicable Margin.

 

(c)Interest accrued on each Loan    shall be payable in arrears on the last day of each Interest Period; *provided*    that (i) interest accrued    pursuant to clause (b) above shall be payable on demand and (ii) upon any    repayment of any Loan, interest accrued on the principal amount repaid shall    be payable on the date of such repayment.

 

(d)All interest hereunder will    be computed on the basis of a year of 360 days, except that interest computed    by reference to the Alternate Rate shall be determined as agreed in accordance    with Section 2.08, and interest computed by reference to the Base Rate at    times when the Base Rate is based on the Prime Rate will be computed on the    basis of a year of 365 days (or 366 days in a leap year), and in each case    will be payable for the actual number of days elapsed (including the first    day but excluding the last day (including in the case of any calculation thereof    for an Interest Period)). Each applicable Base Rate or Adjusted LIBOR shall    be determined by the Administrative Agent, and its determination thereof will    be conclusive absent manifest error.

   

Section 2.05.*Payment at Maturity; Evidence of Debt*.(a) The Borrower unconditionally promises to pay to the AdministrativeAgent on the Maturity Date, for the account of each Lender, the then unpaidprincipal amount of such Lender's Loan (together with accrued and unpaidinterest thereon to the Maturity Date).

 

(b)Each Lender shall maintain in    accordance with its usual practice an account or accounts evidencing the indebtedness    of the Borrower to such Lender resulting from the Loan made by such Lender,    including the amounts of principal and interest payable and paid to such Lender    from time to time.

 

(c)The Administrative Agent shall    maintain accounts in which it shall record (i)    the amount of each Loan made hereunder, (ii) the amount of any principal or    interest due and payable or to become due and payable from the Borrower to    each Lender hereunder and (iii) the amount of any sum received by the Administrative    Agent hereunder for the account of the Lenders and each Lender's share thereof.

 

(d)The entries made in the accounts    maintained pursuant to subsections (b) and (c) of this Section shall be *prima**facie* evidence of the existence and amounts of the obligations recorded    therein; *provided* that any failure by any Lender or the Administrative    Agent to maintain such accounts or any error therein shall not affect the    Borrower's obligation to repay the Loans in accordance with the terms of this    Agreement.

   

(e)Any Lender may request that  the Loan made by it be evidenced by a promissory note (any such promissory  note, a "**Note**"). In such event, the Borrower shall prepare, execute    and deliver to such Lender a Note substantially in the form of Exhibit D hereto    and payable to the order of such Lender (or, if requested by such Lender,    to such Lender and its registered assigns).

 

Section 2.06. *Optional and Mandatory Prepayments*. (a) *Optional Prepayments*. The Borrower shall not bepermitted to prepay, at its option, any Loan in whole or in part at any timeprior to September 11, 2006. On or after September 11, 2006, the Borrower mayprepay any Loan in whole or in part, subject to the provisions of this Section.

 

(b)*Mandatory    Prepayments.*The    Borrower shall prepay Loans in the manner and to the extent required in connection    with any Asset Sale Offer in accordance with the provisions of Section 5.06.

 

(c)*Notice of and Provisions    for Prepayments.*The Borrower shall notify the Administrative Agent by    telephone (confirmed by telecopy) of any prepayment of the Borrowing hereunder    not later than 11:00 a.m., New York City time, five Business Days before the    date of prepayment. Each such notice shall be irrevocable and shall specify    the prepayment date, the principal amount of the Borrowing or portion thereof    to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed    calculation of the amount of such prepayment. Promptly after it receives    any such notice, the Administrative Agent shall advise the Lenders of the    contents thereof. Each partial prepayment of the Loans shall be applied ratably    to all Loans of the Lenders. Each prepayment of the Loans, in whole or in    part, shall be accompanied by accrued interest thereunder to the date of such    prepayment, and premium, if any, with respect thereto.

   

Section 2.07. *Fees*. (a) TheBorrower shall pay to the Administrative Agent, for its own account, feespayable in the amounts and at the times separately agreed upon by the Borrowerand the Administrative Agent.

 

(b)The Borrower shall pay to the    Administrative Agent on the Effective Date, for the account of the Lenders    ratably in accordance with their respective Commitments, a fee in an amount    equal to 0.50% of the aggregate amount of the Commitments.

   

(c)All fees payable hereunder shall    be paid on the dates due, in immediately available funds, to the Administrative    Agent for distribution to the Lenders entitled thereto. Fees paid shall not    be refundable under any circumstances.

 

Section 2.08. *Alternate Rate of Interest.*Ifbefore the beginning of any Interest Period:

 

(i)the Administrative Agent determines    (which determination will be conclusive absent manifest error) that adequate    and reasonable means do not exist for ascertaining Adjusted LIBOR for such    Interest Period; or

(ii)Lenders whose Loans to be included    in the Borrowing aggregate at least 51% thereof advise the Administrative    Agent that the Adjusted LIBOR for such Interest Period will not adequately    and fairly reflect the cost to such Lenders of making or maintaining such    Loans for such Interest Period;

 

then the Administrative Agent shall give noticethereof to the Borrower and the Lenders by telephone or telecopy as promptly aspracticable thereafter and, until the Administrative Agent notifies theBorrower and the Lenders that the circumstances giving rise to such notice nolonger exist, the Loans shall bear interest at a rate for each day equal to (x)the Base Rate for such day *plus* (y) the Applicable Margin for the thencurrent Interest Period *minus* 1% *per annum* (such rate for any day,the "**Alternate Rate**").

 

Section 2.09. *Increased Costs*. (a) If any Change in Law (other than a Change in Law affecting taxes) shall:

 

(i)impose, modify or deem applicable    any reserve, special deposit or similar requirement against assets of, deposits    with or for the account of, or credit extended by, any Lender (except any    such reserve requirement reflected in Adjusted LIBOR); or

(ii)impose on any Lender or the    London interbank market any other condition affecting this Agreement or Loan    made by such Lender;

  

and the result of any of the foregoing shall be toincrease the cost to such Lender, by an amount which such Lender deems to bematerial, of making or maintaining any Loan or reduce any amount received orreceivable by such Lender hereunder (whether of principal, interest orotherwise), then, subject to Section 2.09(e), the Borrower shall pay to suchLender such additional amount or amounts as will compensate it for suchadditional cost incurred or reduction suffered. If any Lender becomes entitledto claim any additional amounts pursuant to this Section 2.09(a), it shallprovide prompt notice thereof to the Borrower, through the AdministrativeAgent, certifying (i) that one of the events described in this Section 2.09(a)has occurred and describing in reasonable detail the nature of such event, (ii)as to the increased cost or reduced amount resulting from such event and (iii)as to the additional amount demanded by such Lender and a reasonably detailedexplanation of the calculation thereof.

 

(b)If any Lender determines that    any Change in Law regarding capital requirements has or would have the effect    of reducing the rate of return on such Lender's capital or on the capital    of such Lender's holding company, if any, as a consequence of this Agreement    or the Loans made by such Lender to a level below that which such Lender or    such Lender's holding company could have achieved but for such Change in Law    (taking into consideration such Lender's policies and the policies of such    Lender's holding company with respect to capital adequacy) by an amount deemed    by such Lender to be material, then, subject to Section 2.09(e), from time    to time after submission by such Lender to the Borrower (with a copy to the    Administrative Agent) of a written request therefor certifying (i)    that an event described in this Section 2.09(b) has occurred and describing    in reasonable detail the nature of such event, (ii) as to the reduction of    the rate of return on capital resulting from such event and (iii) as to the    additional amount or amounts demanded by such Lender or its holding company    and a reasonably detailed explanation of the calculation thereof, the Borrower    shall pay to such Lender such additional amount or amounts as will compensate    it or its holding company for any such reduction suffered.

 

(c)Notwithstanding anything herein    to the contrary, at any time that any Loan is affected by the circumstances    described in paragraphs (a) or (b) of this Section 2.09, the Borrower may,    if the affected Loan is then outstanding, upon at least five Business Days    written notice to the Administrative Agent, repay the Loan of the affected    Lender (including all accrued interest and fees); *provided* that if    more than one Lender is affected at any time, then all affected Lenders must    be treated the same pursuant to this    Section 2.09(c).

 

(d)A certificate of a Lender setting    forth the amount or amounts necessary to compensate it or its holding company,    as the case may be, as specified in subsection (a) or (b) of this Section    shall be delivered to the Borrower and shall be conclusive absent manifest    error. The Borrower shall pay such Lender the amount shown as due on any    such certificate within 10 days after receipt thereof.

   

(e)Failure or delay by any Lender    to demand compensation pursuant to this Section will not constitute a waiver    of its right to demand such compensation; *provided* that the Borrower    will not be required to compensate a Lender pursuant to this Section for any    increased cost or reduction incurred more than 180 days before it notifies    the Borrower of the Change in Law giving rise to such increased cost or reduction    and of its intention to claim compensation therefor. However, if the Change    in Law giving rise to such increased cost or reduction is retroactive, then    the 180-day period referred to above will be extended to include the period    of retroactive effect thereof.

 

Section 2.10. *Break    Funding Payments*. If (a) any principal of    any Loan is repaid on a day other than the last day of an Interest Period    applicable thereto (including as a result of an Event of Default) or (b) the Borrower fails to borrow or prepay any Loan on the    date specified in any notice delivered pursuant hereto, then the Borrower    shall compensate each Lender for its loss, cost and expense attributable to    such event. In the case of a Loan bearing interest based on Adjusted LIBOR,    such loss, cost and expense to any Lender shall be deemed to include an amount    determined by such Lender to be the excess, if any, of (x) the amount of interest    that would have accrued on the principal amount of such Loan had such event    not occurred, at the Adjusted LIBOR that would have been applicable to such    Loan, for the period from the date of such event to the end of the then current    Interest Period therefor (or, in the case of a failure to borrow, convert    or continue, the Interest Period that would have begun on the date of such    failure), over (y) the amount of interest that would accrue on such principal    amount for such period at the interest rate which such Lender would bid were    it to bid, at the beginning of such period, for dollar deposits of a comparable    amount and period from other banks in the eurodollar market. If any Lender    becomes entitled to claim any amounts under this Section 2.10, it shall provide    prompt notice thereof to the Borrower, through the Administrative Agent, certifying    (i) that one of the events described in clause (a) or (b) has occurred and    describing in reasonable detail the nature of such event, (ii) as to the loss    or expense sustained or incurred by such Lender as a consequence thereof and    (iii) as to the amount for which such Lender seeks compensation hereunder    and a reasonably detailed explanation of the calculation thereof. A certificate    of any Lender setting forth any amount or amounts that such Lender is entitled    to receive pursuant to this Section shall be delivered to the Borrower and    shall be conclusive absent manifest error. The Borrower shall pay such Lender    the amount shown as due on any such certificate within 10 days after receipt    thereof.

   

Section 2.11. *Payments Generally; Pro Rata Treatment; Sharing of Set-offs*. (a) The Borrower shall make eachpayment required to be made by it under the Loan Documents (whether ofprincipal, interest or fees or amounts payable under Section 2.09, 2.10 or 5.14 or otherwise) before the time expressly required under the relevant LoanDocument for such payment (or, if no such time is expressly required, before12:00 noon, New York City time), on the date when due, in immediately availablefunds, without set‐off or counterclaim. Any amount received after suchtime on any day may, in the sole discretion of the Administrative Agent, bedeemed to have been received on the next succeeding Business Day for purposesof calculating interest thereon. All such payments shall be made to theAdministrative Agent through wire transfer of immediately available funds tothe Administrative Agent's account at Bank of New York, ABA 021000018, A/CName: CSFB Agency Cayman Account, A/C Number: 8900492627, Reference: Vitro;except that payments pursuant to Sections Section 2.09, 2.10, 5.14 and 9.03 shall be made directly to the Persons entitled thereto and payments pursuant toother Loan Documents shall be made to the Persons specified therein. TheAdministrative Agent shall distribute any such payment received by it for theaccount of any other Person to the appropriate recipient promptly after receiptthereof. If any payment under any Loan Document shall be due on a day that isnot a Business Day, the date for payment will be extended to the nextsucceeding Business Day and, if such payment accrues interest, interest thereonwill be payable for the period of such extension. All payments under each LoanDocument shall be made in Dollars.

 

(b)If at any time insufficient    funds are received by and available to the Administrative Agent to pay fully    all amounts of principal, interest and fees then due hereunder, such funds    shall be applied (i) first,    to pay interest and fees then due hereunder, ratably among the parties entitled    thereto in accordance with the amounts of interest and fees then due to such    parties, and (ii) second, to pay principal then due hereunder, ratably among    the parties entitled thereto in accordance with the amounts of principal then    due to such parties.

 

(c)If any Lender shall, by exercising    any right of set-off or counterclaim or otherwise, obtain payment in respect    of any principal of or interest on any of its Loans resulting in such Lender    receiving payment of a greater proportion of the aggregate amount of its Loans    and accrued interest thereon than the proportion received by any other Lender,    then the Lender receiving such greater proportion shall purchase (for cash    at face value) participations in the Loans of other Lenders to the extent    necessary so that the benefit of all such payments shall be shared by the    Lenders ratably in accordance with the aggregate amount of principal of and    accrued interest on their respective Loans; *provided* that (i)    if any such participations are purchased and all or any portion of the payment    giving rise thereto is recovered, such participations shall be rescinded and    the purchase price restored to the extent of such recovery, without interest,    and (ii) the provisions of this subsection shall not apply to any payment    made by the Borrower pursuant to and in accordance with the express terms    of this Agreement or any payment obtained by a Lender as consideration for    the assignment of or sale of a participation in any of its Loans to any assignee    or participant, other than to the Borrower or any Subsidiary or Affiliate    thereof (as to which the provisions of this subsection shall apply). The    Borrower consents to the foregoing and agrees, to the extent it may effectively    do so under applicable law, that any Lender acquiring a participation pursuant    to the foregoing arrangements may exercise against the Borrower rights of    set-off and counterclaim with respect to such participation as fully as if    such Lender were a direct creditor of the Borrower in the amount of such participation.

 

(d)Unless, before the date on which    any payment is due to the Administrative Agent for the account of one or more    Lender Parties hereunder, the Administrative Agent receives from the Borrower    notice that the Borrower will not make such payment, the Administrative Agent    may assume that the Borrower has made such payment on such date in accordance    herewith and may, in reliance on such assumption, distribute to each relevant    Lender Party the amount due to it. In such event, if the Borrower has not    in fact made such payment, each Lender Party severally agrees to repay to    the Administrative Agent forthwith on demand the amount so distributed to    such Lender Party with interest thereon, for each day from and including the    day such amount is distributed to it to but excluding the day it repays the    Administrative Agent, at the greater of the Federal Funds Effective Rate and    a rate determined by the Administrative Agent in accordance with banking industry    rules on interbank compensation.

 

(e)If any Lender fails to make    any payment required to be made by it pursuant to Section 2.03(b), 2.11(d),    or 9.03(c), the Administrative Agent may, in its discretion (notwithstanding    any contrary provision hereof), apply any amounts thereafter received by the    Administrative Agent for the account of such Lender to satisfy such Lender's    obligations under such Sections until all such unsatisfied obligations are    fully paid.

   

Section 2.12. *Lender's Obligation toMitigate.*If any Lender requests compensation under Section 2.09,or if the Borrower is required to pay any additional amount to any Lender orany Governmental Authority for the account of any Lender pursuant to Section5.14, then such Lender shall use reasonable efforts to designate a differentlending office for funding or booking its Loans hereunder or to assign itsrights and obligations hereunder to another of its offices, branches oraffiliates, if, in the reasonable judgment of such Lender, such designation orassignment **Error! Bookmark not defined.**(i) would eliminate or reduceamounts payable pursuant to Section 2.09 or Section 5.14, as the case may be,in the future, **Error! Bookmark not defined.**(ii) would not subject suchLender to any unreimbursed cost or expense (unless the Borrower agrees toreimburse such Lender for any such costs and expenses) and **Error! Bookmarknot defined.**(iii) would not otherwise be disadvantageous to such Lender. The Borrower shall pay all reasonable costs and expenses incurred by any Lenderin connection with any such designation or assignment.

 

Section 2.13*. Judgment Currency.*Iffor the purpose of obtaining judgment in any court it is necessary to convert asum due from the Borrower under any Loan Document in the currency expressed tobe payable in such Loan Document (the "**specifiedcurrency**") into another currency, the parties hereto agree, to the fullestextent that they may effectively do so, that the rate of exchange used shall bethat at which in accordance with normal banking procedures the AdministrativeAgent could purchase the specified currency with such other currency at theAdministrative Agent's New York City office at 11:00 a.m. (New York City time)on the Business Day preceding that on which final judgment is given. Theobligations of the Borrower in respect of any sum due to any Lender or theAdministrative Agent under any Loan Document shall, notwithstanding anyjudgment in a currency other than the specified currency, be discharged only tothe extent that on the Business Day following receipt by such Lender or theAdministrative Agent (as the case may be) of any sum adjudged to be so due insuch other currency such Lender or the Administrative Agent (as the case maybe) may in accordance with normal banking procedures purchase the specifiedcurrency with such other currency. If the amount of the specified currency sopurchased is less than the sum originally due to such Lender or theAdministrative Agent, as the case may be, in the specified currency, theBorrower agrees, to the fullest extent that it may effectively do so, as aseparate obligation and notwithstanding any such judgment, to indemnify suchLender or the Administrative Agent, as applicable, against such loss, and ifthe amount of the specified currency so purchased exceeds (i) the sumoriginally due to such Lender or the Administrative Agent, as applicable, and (ii) any amounts shared with other Lenders as a result of allocations of such excess as adisproportionate payment to such Lender under Section 2.11, such Lender or theAdministrative Agent, as applicable, agrees to remit such excess to theBorrower.

 

**Article 3     Representations and Warranties**

 

Each Credit Party represents andwarrants to the Lender Parties that:

 

Section 3.01.*Organization;Powers*. Each of the Borrower and its Subsidiaries has been dulyincorporated, is validly existing under the laws of the jurisdiction in whichit was incorporated and, where applicable, is in good standing under the lawsof the jurisdiction in which it is chartered or organized with full corporatepower and authority to own or lease, as the case may be, and to operate itsproperties and conduct its business and is duly qualified to do business as aforeign corporation and is in good standing under the laws of each jurisdictionthat requires such qualification, other than where the failure to be soqualified or in good standing would not have a Material Adverse Effect.

 

Section 3.02*. Stock.* Except as otherwise set forth in Schedule 3.02, (a) all the outstanding sharesof Capital Stock of each Subsidiary of the Borrower have been duly authorizedand validly issued and are fully paid and nonassessable, and (b) alloutstanding shares of Capital Stock of the Subsidiaries of the Borrower held bythe Borrower are owned by the Borrower either directly or through Wholly OwnedSubsidiaries free and clear of any Lien other than Permitted Liens.

 

Section 3.03.*Authorization;Enforceability*. The execution, delivery and performance of (x) the LoanDocuments and (y) the borrowing of the Loans and the other transactionscontemplated hereby or thereby are within the corporate powers of each CreditParty party thereto and have been duly authorized by all necessary corporateand, if required, stockholder action. This Agreement has been duly executedand delivered by the Borrower and each of its Subsidiaries party hereto andconstitutes, and each other Loan Document to which any Credit Party is to be aparty, when executed and delivered by such Credit Party, will constitute, alegal, valid and binding obligation enforceable against each of the Borrowerand any Credit Party that is a party thereto, in accordance with its terms,subject to applicable bankruptcy, *concurso mercantil*, insolvency,reorganization, moratorium, tax, labor and other laws affecting creditors'rights generally and subject to general principles of equity, regardless ofwhether considered in a proceeding in equity or at law.

 

Section 3.04.*GovernmentalApprovals*. No consent, approval, authorization, filing with or order ofany court or governmental agency or body is required in connection with thetransactions contemplated in the Loan Documents, except such as may be requiredunder the Loan Documents.

 

Section 3.05*. No Conflicts.* None of the execution and delivery of the Loan Documents, the consummation ofany other of the transactions therein contemplated, nor the fulfillment of theterms thereof will conflict with, result in a breach or violation or impositionof any Lien upon any property or assets of the Borrower or any of itsSubsidiaries pursuant to, (i) the *estatutos sociales* or comparableconstituting documents of Vitro, the Borrower or any of their Subsidiaries; (ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note agreement,loan agreement or other agreement, obligation, condition, covenant orinstrument to which Vitro, the Borrower or any of their Subsidiaries is a partyor bound or to which its or their property is subject; or (iii) any statute,law, rule, regulation, judgment, order or decree of any court, regulatory body,administrative agency, governmental body, arbitrator or other authority havingjurisdiction over Vitro, the Borrower or any of their Subsidiaries or any ofits or their properties.

 

Section 3.06.*FinancialStatements; No Material Adverse Change*. (a) The Borrower has heretoforefurnished to the Lenders (i) its audited combined consolidated balance sheet asof December 31, 2004 and the related audited combined consolidated statementsof income, stockholders' equity and changes in financial position (*cambiosen la situacion financiera*) for the fiscal year then ended, reported on byDeloitte Touche Tohmatsu, independent public accountants, and (ii) itsunaudited combined consolidated balance sheet as of June 30, 2005, and therelated combined consolidated statements of income and changes in financialposition (*cambios en la situacion financiera*) for the portion of thefiscal year then ended, all certified by its chief financial officer. Suchfinancial statements present fairly, in all material respects, the financialposition (*cambios en la situacion financiera*) of the Borrower and itsconsolidated Subsidiaries as of such dates and their results of operations andchanges in financial position (*cambios en la situacion financiera*) forsuch periods in accordance with Mexican GAAP, subject to normal year‐endadjustments and the absence of footnotes in the case of the statements referredto in clause (ii) above.

 

(b)Since December 31, 2004, there    has been no Material Adverse Effect.

   

Section 3.07.*Litigation.*Except as set forth on Schedule 3.07, no action, suit or proceeding by orbefore any court or governmental agency, authority or body or any arbitratorinvolving the Borrower or any of its Subsidiaries or its or their property ispending or, to the best knowledge of the Borrower, threatened that, in eachcase, could reasonably be expected to have a Material Adverse Effect.

 

Section 3.08*. Properties.*(a) Except as set forth in Schedule 3.08(a), each of the Borrower and its Subsidiarieshas good and marketable title in fee simple to all real property purported tobe owned by it and owns all of its personal property purported to be owned byit, in each case, free and clear of all liens, encumbrances, claims and defectsexcept Permitted Liens. 

 

(b)The Borrower and its    Subsidiaries own, possess, license or have other rights to use all patents,    patent applications, trade and service marks, trade and service mark    registrations, trade names, copyrights, licenses, inventions, trade secrets,    technology, know-how and other intellectual property (collectively, the "**Intellectual Property**")    necessary for the conduct of the Borrower's business as now conducted, except    where the failure to own, possess, license or have other rights to use such    Intellectual Property would not reasonably be expected to have a Material    Adverse Effect. Except as set forth in Schedule 3.08(b), there is no pending    or, to the Borrower's knowledge, threatened action, suit, proceeding or claim    by others challenging the validity or scope of any of the Intellectual Property    that could reasonably be expected to have a Material Adverse Effect, and the    Borrower is unaware of any facts that would form a reasonable basis for any    such claim. Except as set forth in Schedule 3.08(b), (i) there is no pending or, to the Borrower's knowledge, threatened action, suit, proceeding or claim    by others that the Borrower or any of its Subsidiaries infringes or otherwise    violates any patent, trademark, copyright, trade secret or other proprietary    rights of others that could reasonably be expected to have a Material Adverse    Effect, and (ii) the Borrower is unaware of any other fact that would form    a reasonable basis for any such claim.

   

Section 3.09*. Compliance with Laws andAgreements.*Except for laws relating to taxes, which arecovered in Section 3.11 below, neither the Borrower nor any of its Subsidiariesis in violation or default of (a) any provision of its *estatutos sociales*or comparable constituting documents; (b) the terms of any indenture, contract,lease, mortgage, deed of trust, note agreement, loan agreement or otheragreement, obligation, condition, covenant or instrument to which it is a partyor bound or to which its property is subject; or (c) any statute, law, rule,regulation, judgment, order or decree applicable to the Borrower or any of itsSubsidiaries of any court, regulatory body, administrative agency, governmentalbody, arbitrator or other authority having jurisdiction over the Borrower orsuch subsidiary or any of its properties, as applicable, other than violationsand defaults with respect to clauses (b) and (c) which individually and in theaggregate do not have and would not reasonably be expected to have a MaterialAdverse Effect.

 

Section 3.10.*Investment andHolding Company Status*. None of the Borrower and its Subsidiaries is an"investment company" as defined in, or subject to regulation under, theInvestment Company Act of 1940.

 

Section 3.11.*Taxes*. 

 

(a)There are no stamp or other    issuance or transfer taxes or duties or other similar fees or charges required    to be paid in connection with the execution and delivery of this Agreement    or Borrowing hereunder. 

   

(b)Each of the Borrower and its    Subsidiaries has filed all foreign, federal, state and local tax returns that    are required to be filed or has requested extensions thereof (except in any    case in which the failure so to file would not have a Material Adverse Effect)    and has paid all taxes required to be paid by it and any other assessment,    fine or penalty levied against it, to the extent that any of the foregoing    is due and payable, except for any such assessment, fine or penalty that is    currently being contested in good faith or as would not have a Material Adverse    Effect.

   

Section 3.12*. Labor.*Nolabor problem or dispute with the employees of the Borrower or any of itsSubsidiaries exists or, to the knowledge of the Borrower, is threatened orimminent, and the Borrower is not aware of any existing or imminent labordisturbance by the employees of any of its or its Subsidiaries' principalsuppliers, contractors or customers, except as would not have a MaterialAdverse Effect. 

 

Section 3.13*. Insurance.*TheBorrower and each of its Subsidiaries are insured by insurers of recognizedfinancial responsibility against such losses and risks and in such amounts asare prudent and customary in the businesses in which they are engaged; allpolicies of insurance and fidelity or surety bonds insuring the Borrower or anyof its Subsidiaries or their respective businesses, assets, employees, officersand directors are in full force and effect; the Borrower and its Subsidiariesare in compliance in all material respects with the terms of such policies andinstruments; there are no material claims by the Borrower or any of itsSubsidiaries under any such policy or instrument as to which any insurancecompany is denying liability or defending under a reservation of rights clause;neither the Borrower nor any of its Subsidiaries has been refused any insurancecoverage sought or applied for; and neither the Borrower nor any of itsSubsidiaries has any reason to believe that it will not be able to renew itsexisting insurance coverage as and when such coverage expires or to obtainsimilar coverage from similar insurers as may be necessary to continue itsbusiness at a cost that would not have a Material Adverse Effect.

 

Section 3.14*. Conduct of Business.*(a) The Borrower and its Subsidiaries possess all licenses,certificates, permits and other authorizations issued by the appropriatefederal, state or foreign regulatory authorities necessary to conduct theirrespective businesses, other than such licenses, certificates, permits or otherauthorization the failure of which to possess would not have a Material AdverseEffect; neither the Borrower nor any of its Subsidiaries has received anynotice of proceedings relating to the revocation or modification of any suchlicense, certificate, authorization or permit which, singly or in theaggregate, if the subject of an unfavorable decision, ruling or finding, wouldreasonably be expected to have a Material Adverse Effect. 

 

(b)The Borrower and each of its    Subsidiaries maintain a system of internal accounting controls sufficient    to provide reasonable assurance that (i) transactions are executed in accordance    with management's general or specific authorizations; (ii) transactions are    recorded as necessary to permit preparation of financial statements in conformity    with Mexican GAAP and to maintain asset accountability; (iii) access to assets    is permitted only in accordance with management's general or specific authorization;    and (iv) the recorded accountability for assets is compared with the existing    assets at reasonable intervals and appropriate action is taken with respect    to any differences. 

   

Section 3.15*. Environmental andRegulatory Matters.*(a) The Borrower and its Subsidiaries (i) are incompliance with any and all applicable Mexican and foreign, federal, state andlocal laws and regulations relating to the protection of human health andsafety, the environment or hazardous or toxic substances or wastes, pollutantsor contaminants ("**Environmental Laws**"); (ii) have received and are incompliance with all permits, licenses or other approvals required of them underapplicable Environmental Laws to conduct their respective businesses; and (iii) have not received notice of any actual or potential liability under anyEnvironmental Law, except, in the case of clauses (i) through (iii), where suchnon-compliance with Environmental Laws, permits, licenses or other approvals,failure to receive required permits, licenses or other approvals, or liabilitywould not, individually or in the aggregate, have a Material Adverse Effect.

 

(b)In the ordinary course of its    business, the Borrower periodically reviews the effect of Environmental Laws    on the business, operations and properties of the Borrower and its Subsidiaries,    in the course of which it identifies and evaluates associated costs and liabilities    (including, without limitation, any capital or operating expenditures required    for clean-up, closure of properties or compliance with Environmental Laws,    or any permit, license or approval, any related constraints on operating activities    and any potential liabilities to third parties). On the basis of such review,    the Borrower has reasonably concluded that such associated costs and liabilities    could not, singly or in the aggregate, reasonably be expected to have a Material    Adverse Effect.

   

(c)The operations of the Borrower    and its Subsidiaries are and have been conducted at all times in compliance    with applicable financial recordkeeping and reporting requirements of the    Currency and Foreign Transactions Reporting Act of 1970, as amended, the money    laundering statutes of all jurisdictions, the rules and regulations thereunder    and any related or similar rules, regulations or guidelines, issued,    administered or enforced by any governmental agency (collectively, the "**Money Laundering    Laws**") and no action, suit or proceeding by or before any court or governmental    agency, authority or body or any arbitrator involving the Borrower or any    of its Subsidiaries with respect to the Money Laundering Laws is pending or,    to the best knowledge of the Borrower, threatened.

   

(d)None of the Borrower, any of    its Subsidiaries or, to the knowledge of the Borrower, any director,    officer, agent, employee or Affiliate of the Borrower or any of its    Subsidiaries is currently subject to any U.S. sanctions administered by the    Office of Foreign Assets Control of the U.S. Department of the Treasury ("**OFAC**"); and    the Borrower will not directly or indirectly use the proceeds of the Loans,    or lend, contribute or otherwise make available such proceeds to any subsidiary,    joint venture partner or other person or entity, for the purpose of financing    the activities of any person currently subject to any U.S. sanctions administered    by OFAC. 

   

Section 3.16.*Pari Passu Status.* The obligations of each Credit Party under the Loan Documents constitute direct    and unconditional obligations of such Credit Party and rank at least *pari    passu* in right of payment, with all other obligations of such Credit Party    at any time outstanding; except (i) with respect to assets that are subject    to Permitted Liens and (ii) that in any bankruptcy proceeding initiated in    Mexico pursuant to the laws of Mexico, labor claims (with respect to base    salary, exclusively for a period of two years), claims of tax authorities    for unpaid taxes, litigation costs, fees and expenses of the mediator (*conciliador*),    receiver (*sIndico*) and visitor (*visitador*), social security    quotas, workers' housing fund quotas, retirement fund quotas and claims of    secured creditors up to the value of their respective collateral will have    priority over claims of the Administrative Agent and the Lenders. 

 

Section 3.17.*Subsidiaries*. Schedule 3.17 sets forth the name of, and the ownership interest of theBorrower in, each of its Subsidiaries and identifies each Subsidiary that is aGuarantor, in each case as of the Effective Date. All the Borrower'sSubsidiaries are, and will at all times be, except as required or permittedunder Mexican GAAP, fully consolidated in its consolidated financialstatements. As of the Effective Date, each Subsidiary that is a "Guarantor"under the Existing Senior Note Indenture and Existing Credit Facility is aGuarantor under this Agreement.

 

Section 3.18.*Solvency*. As of the Effective Date, (i) the fair value of the assets of each CreditParty, at a fair valuation, exceeds its debts and liabilities, subordinated,contingent or otherwise; (ii) the present fair saleable value of the propertyof each Credit Party exceeds the amount that will be required to pay theprobable liability of its debts and other liabilities, subordinated, contingentor otherwise, as such debts and other liabilities become absolute and matured; (iii) each Credit Party will be able to pay its debts and liabilities, subordinated,contingent or otherwise, as such debts and liabilities become absolute andmatured; (iv) no Credit Party has unreasonably small capital with which toconduct the business in which it is engaged as such business is now conductedand proposed to be conducted after the Effective Date and (v) each Credit Partywill not, or will not deemed to be, generally in default with respect to itspayment obligations pursuant to the Mexican*Ley de Concursos Mercantiles*.

 

Section 3.19.*Legal Form.* (a) Each of the Loan Documents is in proper legal form under all applicablelaws for the enforcement thereof in accordance with their respective termsagainst the parties thereto under such laws. To ensure the legality, validity,enforceability or admissibility into evidence of the Loan Documents, it is notnecessary that any of such Loan Documents or any other document be filed orrecorded with any applicable Governmental Authority or that any stamp orsimilar tax be paid on or in respect of this Agreement or any Note, or anyother such document, except that in the event that any legal proceedings withrespect to any Loan Document are brought in the courts of Mexico, a Spanishtranslation of the documents required in such proceedings prepared by a Mexicancourt-approved translator would have to be approved by the court after thedefendant had been given an opportunity to be heard with respect to theaccuracy of such translation, and the proceedings would thereafter be basedupon the translated documents. Any judgment against the Borrower obtained in anon-Mexican state or federal court to which the Borrower is submitting pursuantto Section 9.09(b) hereof is capable of being enforced in the courts of Mexico,subject to the satisfaction of all applicable procedural requirements.

   

(b)Neither the Borrower nor any    of its property has any immunity on the ground of sovereignty or otherwise,    from the jurisdiction of any court or from any legal process (whether through    service or notice, attachment prior to judgment, attachment in aid of execution,    execution or otherwise) under any applicable laws in respect of the obligations    of the Borrower under the Loan Documents or from the execution or enforcement    of any judgment resulting therefrom, and if the Borrower or any of its revenues,    assets or properties should become entitled to any such right of immunity,    the Borrower has effectively waived such right pursuant to Section 9.09(e).

   

(c)It is not necessary in order    for any Lender Party to enforce any of its rights or remedies under the Loan    Documents or solely by reason of the execution, delivery and performance by    the Borrower of the Loan Documents, that any Lender Party be licensed or qualified    with any Mexican Governmental Authority or be entitled to carry on business    in any jurisdiction.

   

(d)Any certificate signed by any    officer of the Borrower and delivered to the Administrative Agent (or its    counsel) in connection with the Loans and this Agreement shall be deemed a    representation and warranty by the Borrower, as to matters covered thereby,    to each Lender.

   

Section 3.20*. Disclosure.*Allinformation furnished on or prior to the Effective Date by any Credit Party tothe Administrative Agent or any Lender in connection with this Agreement andthe transactions contemplated hereby are true, complete and accurate in allmaterial respect, or (in the case of projections, if applicable) based onreasonable estimates, on the date as of which such information is stated orcertified. 

   

**Article 4    Conditions**

 

Section 4.01.*Effective Date*. The obligations of the Lenders to make Loans hereunder shall not becomeeffective until the date on which each of the following conditions is satisfied(or waived in accordance with Section 9.02):

 

(a)The Administrative Agent (or    its counsel) shall have received (i) from each party to this Agreement either    (x) a counterpart hereof signed on behalf of such party or (y) written evidence    satisfactory to the Administrative Agent (which may include telecopy transmission    of a signed signature page) that such party has signed a counterpart of this    Agreement and (ii) from each party to the Additional Interest Letter either    (x) a counterpart hereof signed on behalf of such party or (y) written evidence    satisfactory to the Administrative Agent (which may include telecopy transmission    of a signed signature page) that such party has signed a counterpart of the    Additional Interest Letter.

   

(b)The Administrative Agent shall    have received a favorable written opinion (addressed to the Administrative    Agent and the Lenders and dated the Effective Date) of each of (i) Cravath,    Swaine & Moore LLP, special New York counsel to the Borrower and the Guarantors,    (ii) Lic. Alejandro Sanchez, General Counsel to the Borrower and the Guarantors,    and (iii) Kuri Brena, Sanchez Ugarte, Corcuera y Aznar, S.C., special Mexican    counsel to the Borrower and the Guarantors, substantially in the form of Exhibits    B-1, B-2 and B-3, respectively. The Borrower requests such counsel to deliver    such opinions.

   

(c)The Administrative Agent shall    have received a favorable written opinion (addressed to the Administrative    Agent and the Lenders and dated the Effective Date) of each of (i) Davis Polk    & Wardwell, special New York counsel to the Administrative Agent and (ii)    Creel, Garcia-Cuellar y Muggenburg, S.C., special Mexican counsel to the Administrative    Agent, substantially in the form of Exhibits C-1 and C-2, respectively, in    each case covering such matters relating to the Loan Documents as the Required    Lenders may reasonably request.

   

(d)The Administrative Agent shall    have received such documents and certificates as the Administrative Agent    or its counsel may reasonably request relating to (i) the organization, existence    and good standing of each Credit Party, (ii) the authorization of the Borrowing    hereunder (including the execution and delivery of, and performance by such    Credit Party of its obligations under, each Loan Document to which it is a    party) and any other transactions contemplated hereby and (iii) any other    legal matters relating to the Credit Parties, the Loan Documents or such other    transactions, all in form and substance satisfactory to the Administrative    Agent and its counsel.

   

(e)The Administrative Agent shall    have received a certificate, dated the Effective Date and signed by the President,    a Vice President or an Officer of the Borrower, confirming compliance with    the conditions set forth in clauses (l) and (m) of this Section.

   

(f)The Administrative Agent shall    have received irrevocable authorization by the Borrower to deduct (i) all    fees referred to in Section 2.07 hereof and all reasonable and documented    accrued fees and expenses of the Administrative Agent and of the expenses    then due and payable under Section 9.03 hereof, including, without limitation,    the reasonable and documented fees and expenses of Davis Polk & Wardwell,    special New York counsel to the Administrative Agent, and Creel, GarcIa-Cuellar    y Muggenburg, S.C., special Mexican counsel to the Administrative Agent, in    connection with the negotiation, preparation, execution and delivery of the    Loan Documents and the making of the Loans hereunder, and also including all    stamp taxes or similar taxes in connection with the Loan Documents, from the    proceeds of the Loans; *provided*, that a statement of such fees and    expenses shall have been submitted at least one Business Day prior to the    Effective Date and (ii) all outstanding fees and expenses due to Cravath,    Swaine & Moore LLP.

   

(g)The Administrative Agent shall    have received certification, substantially in the form of Exhibit E hereto,    as to the financial condition and solvency of the Borrower and its Subsidiaries    from the Chief Financial Officer of the Borrower.

   

(h)The Administrative Agent shall    have received a certificate of each Credit Party in substantially the form    of Exhibit G hereto as to the authority, incumbency and specimen signatures    of the persons who have executed the Loan Documents and any other documents    in connection herewith on behalf of such Credit Party.

   

(i)No changes or developments shall    have occurred, and no new or additional information, shall have been received    or discovered by the Administrative Agent or the Lenders regarding the Borrower    and its Subsidiaries after September 1, 2005 as a result of their continuing    investigation or otherwise that either individually or in the aggregate, could    reasonably be expected to have a Material Adverse Effect.

   

(j)There shall not have occurred    a material adverse change in the business, assets, properties, liabilities    (actual and contingent), operations, condition (financial or otherwise) or    prospects of the Borrower and its Subsidiaries, taken as a whole, since December    31, 2004.

   

(k)The Administrative Agent shall    have received (i) a Mexican law notarized special irrevocable power of Borrower    and each Guarantor (other than Vitro Packaging, Inc.) appointing the Process    Agent in substantially the form of Exhibit J hereto; and (ii) a Process Agent    Acceptance, duly executed and delivered by the Process Agent in accordance    with Section 9.09(d).

   

(l)Each of the representations    and warranties of each Credit Party set forth in the Loan Documents shall    be true in all material respects on and as of the Effective Date.

   

(m)No Default shall have occurred    and be continuing.

   

(n)The Administrative Agent shall    have received the Borrowing Request in accordance with Section 2.02 hereof.

   

(o)The Administrative Agent shall    have received the Notes evidencing the Loans in accordance with Section 2.05(e)    hereof. 

   

(p)The Administrative Agent shall    have received irrevocable instructions signed by the Borrower, in form and    substance satisfactory to the Administrative Agent, as to the remittance by    the Administrative Agent of the proceeds of the Loans (such instructions to    be consistent with the provisions of Section 4.01(f) above). 

   

(q)Substantially simultaneously    with the making of the Loans hereunder, Vitro Plan shall have entered into    a credit facility in an aggregate principal amount of $45,000,000, and the    loans provided for thereunder shall have been fully made.

 

Promptly after the Effective Date occurs, theAdministrative Agent shall notify the Borrower and the Lenders thereof, andsuch notice shall be conclusive and binding. Notwithstanding the foregoing,the obligations of the Lenders to make Loans shall not become effective unlesseach of the foregoing conditions is satisfied, all in form and substance reasonablysatisfactory to the Administrative Agent and its counsel, (or waived pursuantto Section 9.02) before 5:00 p.m., New York City time, on October 3, 2005 (and,if any such condition is not so satisfied or waived, the Commitments shallterminate at such time).

 

Unless the Borrower otherwise notify the Administrative Agentprior to the Effective Date, the Borrowing Request shall constitute acertification by the Borrower that all the conditions set forth in this Section 4.01 have been fulfilled as of the Effective Date.

   

**Article 5    Covenants**

   

Section 5.01.*Compliance Certificate.* The Borrower and each Guarantor shall deliver to the Administrative Agent    within 90 days after the end of each fiscal year of the Borrower, an Officer's    Certificate stating that in the course of the performance by the signers of    their duties as Officers of the Borrower or such Guarantor, as the case may    be, they would normally have knowledge of any Default or Event of Default    and whether or not the signers know of any Default or Event of Default that    occurred during such period or following such event, as the case may be. If they do, the certificate shall describe the Default or Event of Default,    its status and what action the Borrower or such Guarantor is taking or proposes    to take with respect thereto.

   

Section 5.02.*Waiver of Stay, Extension    or Usury Laws.* The Borrower and each Guarantor covenants (to the    fullest extent permitted by applicable law) that it will not at any time insist    upon, plead, or in any manner whatsoever claim or take the benefit or advantage    of, any stay or extension law or any usury law or other law that would prohibit    or forgive the Borrower or such Guarantor from paying all or any portion of    the principal of or interest on the Loans as contemplated herein, wherever    enacted, now or at any time hereafter in force, or which may affect the covenants    or the performance of this Agreement. The Borrower and each Guarantor hereby    expressly waives (to the fullest extent permitted by applicable law) all benefit    or advantage of any such law, and covenants that it will not hinder, delay    or impede the execution of any power herein granted to the Administrative    Agent, but will suffer and permit the execution of every such power as though    no such law had been enacted.

   

Section 5.03.*Limitation on Incurrence    of Additional Indebtedness.* (a) The Borrower will not, and will    not cause or permit any of its Restricted Subsidiaries to, directly or indirectly,    Incur any Indebtedness, including Acquired Indebtedness, without duplication,    or permit any Restricted Subsidiary to Incur Preferred Stock, except that    Comegua and its Subsidiaries may Incur Indebtedness, including Acquired Indebtedness,    if, at the time of and immediately after giving pro forma effect to the Incurrence    thereof and the application of the proceeds therefrom, the Consolidated Fixed    Charge Coverage Ratio of Comegua is greater than (x) 2.50 to 1.00, if such    Indebtedness is Incurred on or prior to July 23, 2006 and (y) 2.75 to 1.00    if such Indebtedness is Incurred after July 23, 2006 but on or prior to the    Maturity Date; provided that any such Indebtedness may not be Guaranteed    by VENA or any of its Restricted Subsidiaries (other than Comegua and its    Subsidiaries).

   

(b)Notwithstanding clause (a)    above, the Borrower and its Restricted Subsidiaries, as applicable, may    Incur the following Indebtedness, including Acquired Indebtedness, if    applicable ("**Permitted    Indebtedness**"):

(i)Indebtedness of the Borrower    in respect of the Existing Senior Notes not to exceed an amount equal to (A)    the lesser of (i) $250 million and (ii) $400 million minus the aggregate principal    amount of all Senior Credit Facilities at any one time outstanding, minus    (B) the sum of (x) the aggregate principal amount of any Indebtedness incurred    to refinance the Existing Senior Notes pursuant to (xi)(B) below at any one    time outstanding and (y) the amount of all permanent repayments, redemptions,    repurchases or reductions of commitments, as applicable, in respect of the    Existing Senior Notes and the Senior Credit Facilities made in order to comply    with Section 3.9 of the Existing Senior Note Indenture and Section 5.03(b)    of the Existing Credit Facility;

(ii)Indebtedness Incurred by the    Borrower and any Guarantor under any    Senior Credit Facilities (including Indebtedness under the Loan Documents    and any other Indebtedness deemed to be a Senior Credit Facility after the    date hereof) in an aggregate principal amount at any one time outstanding    not to exceed an amount equal to (A) $400 million minus the aggregate principal    amount of the Existing Senior Notes at any one time outstanding, minus (B)    the sum of (x) the aggregate principal amount of any Indebtedness incurred    to refinance the Existing Senior Notes pursuant to (xi)(B) below at any one    time outstanding and (y) the amount of all permanent repayments, redemptions,    repurchases or reductions of commitments, as applicable, in respect of the    Existing Senior Notes and the Senior Credit Facilities made in order to comply    with Section 3.9 of the Existing Senior Note Indenture and Section 5.03(b)    of the Existing Credit Facility;

(iii)[Intentionally Omitted]

(iv)Indebtedness of the Borrower    or any Guarantor in respect of a Qualified Receivables Transaction;

(v)Indebtedness of the Borrower    or any Guarantor Incurred for working capital needs, to fund capital expenditures    and to make interest payments, in each case in the ordinary course of business,    in an aggregate principal amount not to exceed $75 million at any one time    outstanding (it being understood that Indebtedness outstanding on the date    hereof and listed under the caption "Existing Working Capital Liens" in Schedule    5.03 shall be deemed Incurred under this clause (v));

(vi)Indebtedness of the Borrower    and its Restricted Subsidiaries outstanding on the Effective Date as set forth    in Schedule 5.03 (other than Indebtedness outstanding on the date hereof and    listed under the caption "Existing Working Capital Liens" in Schedule 5.03);

(vii)Hedging Obligations entered    into by the Borrower and its Restricted Subsidiaries in the ordinary course    of business and not for speculative purposes;

(viii)intercompany Indebtedness or    Preferred Stock between the Borrower and any Restricted Subsidiary or between    any Restricted Subsidiaries; *provided* that in the event that at any    time any such Indebtedness ceases to be held by the Borrower or a Restricted    Subsidiary, such Indebtedness will be deemed to be Incurred and not permitted    by this clause (viii) at the time such event occurs;

(ix)Indebtedness of the Borrower    or any of its Restricted Subsidiaries arising from the honoring by a bank    or other financial institution of a check, draft or similar instrument inadvertently    (including daylight overdrafts paid in full by the close of business on the    day such overdraft was Incurred) drawn against insufficient funds in the ordinary    course of business; *provided* that such Indebtedness is extinguished    within five Business Days of Incurrence;

(x)Indebtedness of the Borrower    or any of its Restricted Subsidiaries represented by bankers' acceptances,    surety or appeal bonds, letters of credit, performance bonds or similar instruments    for the account of the Borrower or any Restricted Subsidiary, as the case    may be, in order to provide security for workers' compensation claims, payment    obligations in connection with self insurance or similar requirements in the    ordinary course of business;

(xi)Refinancing Indebtedness in    respect of:

(A)Indebtedness (other than Indebtedness    owed to the Borrower or any Subsidiary) Incurred pursuant to clause (a) above    (it being understood that no Indebtedness outstanding on the Effective Date    is Incurred pursuant to such clause (a) above), or

(B)Indebtedness Incurred pursuant    to clauses (i), (vi), (xii) or (xvi) or this clause (xi) of this definition    of "Permitted Indebtedness";

(xii)Acquired Indebtedness of a Restricted    Subsidiary Incurred and outstanding on or prior to the date on which such    Restricted Subsidiary was acquired by the Borrower (other than Acquired Indebtedness    Incurred in connection with, or to provide all or any portion of the funds    or credit support utilized to consummate, the transaction or series of related    transactions pursuant to which such Restricted Subsidiary became a Restricted    Subsidiary or was acquired by the Borrower); *provided*, *however*,    that on the date of such acquisition and after giving pro forma effect to    the Incurrence of such Acquired Indebtedness, (x) in the case of Acquired    Indebtedness of a Subsidiary of Comegua, Comegua would have been able to Incur    at least $1.00 of additional Indebtedness pursuant to clause (a)    above or (y) in any other case, the Required Consolidated Fixed Coverage Ratio    shall be satisfied;

(xiii)Indebtedness arising from agreements    providing for indemnification, adjustment of purchase price or similar obligations,    or from Guarantees, letters of credit, escrows or other similar instruments    securing the obligations of the Borrower or any Restricted Subsidiary pursuant    to such agreements, in any case Incurred in connection with the disposition    of any business, assets or Restricted Subsidiary, in a principal amount not    to exceed the sale price (including the assumption of Indebtedness) in connection    with such disposition;

(xiv)Indebtedness with respect to    bankers' acceptances, surety or appeal bonds, letters of credit, performance    bonds or similar instruments securing obligations entered into in the ordinary    course of business of the Borrower and its Restricted Subsidiaries to the    extent such letters of credit, performance bonds or similar instruments are    not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed    no later than the tenth Business Day following payment on the letter of credit,    performance bonds or similar instrument;

(xv)Indebtedness of one or more    of the Borrower or any Guarantor in a principal amount not to exceed $10 million    in the aggregate at any one time outstanding; and

(xvi)Indebtedness of the Borrower    and any Guarantor under this Agreement in an aggregate principal amount not    to exceed $105,000,000.

  

(c)For purposes of determining    compliance with, and the outstanding principal amount of, any particular Indebtedness    Incurred pursuant to and in compliance with this Section 5.03:

   

(i)the amount of Indebtedness issued    at a price that is less than the principal amount thereof will be equal to    the amount of the liability in respect thereof determined in accordance with    Mexican GAAP;

(ii)accrual of interest, the accretion    or amortization of original issue discount, the payment of regularly scheduled    interest in the form of additional Indebtedness of the same instrument or    the payment of regularly scheduled dividends on Disqualified Capital Stock    in the form of additional Disqualified Capital Stock or Preferred Stock with    the same terms will not be deemed to be an Incurrence of Indebtedness for    purposes of this Section    5.03; *provided*, that any such outstanding additional Indebtedness or    Disqualified Capital Stock paid in respect of Indebtedness Incurred pursuant    to any provision of clause (b) of this Section 5.03    will be counted as Indebtedness outstanding thereunder for purposes of any    future Incurrence under such provision;

(iii)(x) in the event that an item    of Indebtedness meets the criteria of more than one of the types of Indebtedness    described above, the Borrower, in its sole discretion, will classify such    item of Indebtedness at the time of Incurrence and only be required to include    the amount and type of such Indebtedness in one of the above clauses and (y)    an item of Indebtedness may be divided and classified in more than one of    the types of Indebtedness described above; and

(iv)the maximum amount that the    Borrower or a Restricted Subsidiary may Incur pursuant to this Section    5.03 shall not be deemed to be exceeded, with respect    to outstanding Indebtedness, due solely to the result of fluctuations in the    exchange rates of currencies.

  

Section 5.04.*Limitation on Guarantees    of Borrower or Restricted Subsidiary Indebtedness.* The Borrower    will not permit any Restricted Subsidiary other than a Guarantor to Guarantee    any Indebtedness of the Borrower or another Restricted Subsidiary, unless    contemporaneously therewith (or prior thereto) effective provision is made    to Guarantee the Loans, as the case may be, on an equal and ratable basis    with such Guarantee for so long as such Guarantee or Lien remains effective,    and in an amount at least equal to the amount of Borrower or other Restricted    Subsidiary Indebtedness so Guaranteed; *provided*, *however*, that    any Guarantee by any such Restricted Subsidiary of Subordinated Indebtedness    of the Borrower or any Guarantor will be subordinated and junior in right    of payment to the contemporaneous Guarantee of the Loans by such Restricted    Subsidiary; and *provided**further*, that the Borrower will not    permit a Restricted Subsidiary to Guarantee any Capital Stock of the Borrower    or another Restricted Subsidiary.

   

Section 5.05.*Limitation on Restricted    Payments.*  Subject to the terms described in this Section 5.05, the    Borrower will not, and will not cause or permit any of its Restricted    Subsidiaries to, directly or indirectly, take any of the following actions    (each, a "**Restricted Payment**"):

   

(a)declare or pay any dividend    or return of capital or make any distribution on or in respect of shares of    Capital Stock of the Borrower or any Restricted Subsidiary to holders of such    Capital Stock, other than:

(i)dividends or distributions payable    in Qualified Capital Stock of the Borrower,

(ii)dividends, returns of capital    or distributions payable to the Borrower and/or a Restricted Subsidiary, or

(iii)dividends, distributions or    returns of capital made on a pro rata basis to the Borrower and its Restricted    Subsidiaries, on the one hand, and minority holders of Capital Stock of a    Restricted Subsidiary on the other hand (or on less than a pro rata basis    to any minority holder);

  

 (b)purchase, redeem or otherwise    acquire or retire for value:

   

(i)any Capital Stock of the Borrower,    or

(ii)any Capital Stock of any Restricted    Subsidiary held by an Affiliate of the Borrower (other than a Restricted Subsidiary)    or any Preferred Stock of a Restricted Subsidiary, except for Capital Stock    held by the Borrower or a Restricted Subsidiary or purchases, redemptions,    acquisitions or retirements for value of Capital Stock on a pro rata basis    from the Borrower and/or any Restricted Subsidiaries, on the one hand, and    minority holders of Capital Stock of a Restricted Subsidiary, on the other    hand, according to their respective percentage ownership of the Capital Stock    of such Restricted Subsidiary;

  

(c)make any principal payment on,    purchase, defease, redeem, prepay, decrease or otherwise acquire or retire    for value, prior to any scheduled final maturity, scheduled repayment or scheduled    sinking fund payment, as the case may be, any Subordinated Indebtedness; or

   

(d)make any Investment (other than    Permitted Investments);

   

if at the time of theRestricted Payment and immediately after giving effect thereto:

(1) a Default or an Event of    Default has occurred and be continuing;

(2) the Required Consolidated    Fixed Coverage Ratio shall not be satisfied; or

(3) the aggregate amount (the    amount expended for these purposes, if other than in cash, being the Fair    Market Value of the relevant property) of the proposed Restricted Payment    and all other Restricted Payments made subsequent to the Existing Senior Note    Indenture Date up to the date thereof, less any Investment Return calculated    as of the date thereof, shall exceed the sum of (without duplication):

(A) 50% of cumulative Consolidated    Net Income of the Borrower or, if cumulative Consolidated Net Income of the    Borrower is a loss, minus 50% of the loss, accrued during the period, treated    as one accounting period, beginning on the first full fiscal quarter after    the Existing Senior Note Indenture Date to the end of the most recent fiscal    quarter for which consolidated financial information of the Borrower is available;    *plus*

(B) 100% ofthe aggregate net cash proceeds received by the Borrower from any Person fromany:

* contribution to the equity capital    of the Borrower (not representing an interest in Disqualified Capital Stock)    or issuance and sale of Qualified Capital Stock of the Borrower, in each case,    subsequent to the Existing Senior Note Indenture Date, or

* issuance and sale subsequent    to the Existing Senior Note Indenture Date (and, in the case of Indebtedness    of a Restricted Subsidiary, at such time as it was a Restricted Subsidiary)    of any Indebtedness for borrowed money of the Borrower or any Restricted Subsidiary    that has been converted into or exchanged for Qualified Capital Stock of the    Borrower,

excluding, in each case, any net cash    proceeds:

(w) received from a Subsidiary    of the Borrower;

(x) used to redeem Notes under    "-Redemption-Optional Redemption Upon Public Equity Offerings" in Exhibit    A of the Indenture; or

(y) applied in accordance with    clause (4) or (5) of the second paragraph of this covenant below.

   

Notwithstanding    the preceding paragraph, this Section 5.05 does not prohibit:

  

(1) any dividend or other distribution in respect ofCapital Stock of the Borrower while it is a Vitro Restricted Subsidiary either:

(a) payable solely in shares of common stock of theBorrower; or

(b) if:

(i) the making of such Restricted Payment wouldnot result in an Event of Default; and

(ii) at the time of such Restricted Payment andimmediately after giving effect thereto, the Borrower Debt to EBITDA Ratio isless than or equal to 2.0 to 1.0;

 

(2) any loan or advance to Vitro or any VitroRestricted Subsidiary;

 

(3) the payment of any dividend within 60 days afterthe date of declaration of such dividend if the dividend would have beenpermitted on the date of declaration pursuant to the preceding paragraph;

 

(4) if no Default or Event of Default has occurred andbe continuing, the acquisition of any shares of Capital Stock of the Borrower,

(x) in exchange for Qualified    Capital Stock of the Borrower; or

(y) through the application of    the net cash proceeds received by the Borrower from a substantially concurrent    sale of Qualified Capital Stock of the Borrower or a contribution to the equity    capital of the Borrower not representing an interest in Disqualified Capital    Stock, in each case not received from a Subsidiary of the Borrower;

*provided*, that the value of any    such Qualified Capital Stock issued in exchange for such acquired Capital    Stock and any such net cash proceeds will be excluded from clause (3)(B) of    the first paragraph of this Section 5.05 (and were not included therein at    any time); or

 

(5) if no Default or Event of Default has occurred andis continuing, the voluntary prepayment, purchase, defeasance, redemption orother acquisition or retirement for value of any Subordinated Indebtednesssolely in exchange for, or through the application of net cash proceeds of asubstantially concurrent sale, other than to a Subsidiary of the Borrower, of:

(x) Qualified Capital Stock of    the Borrower; or

(y) Refinancing Indebtedness for    such Subordinated Indebtedness;

   

*provided*, that the value of any    Qualified Capital Stock issued in exchange for Subordinated Indebtedness and    any net cash proceeds referred to above will be excluded from clause (3)(B)    of the first paragraph of this Section 5.05 (and were not included therein    at any time).

   

In determining the aggregate amount of RestrictedPayments made subsequent to the Effective Date, amounts expended pursuant toclause (1), (2) (to the extent such loans and advances are not repaid) or (3)(without duplication for the declaration of the relevant dividend) above willbe included in such calculation and amounts expended pursuant to clauses (2)(to the extent such loans and advances are repaid), (3) and (4) above will notbe included in such calculation.

 

Section 5.06.*Limitation on Asset    Sales.*

   

(a)*Asset Sales.* The Borrower    will not, and will not permit any of its Restricted Subsidiaries to, consummate    an Asset Sale unless:

 (i)the Borrower or the applicable    Restricted Subsidiary, as the case may be, receives consideration at the time    of the Asset Sale at least equal to the Fair Market Value of the assets sold    or otherwise disposed of; and

 (ii)(A) prior to the Asset Sale    Amount exceeding $300,000,000, the consideration received for the assets sold    by the Borrower or the Restricted Subsidiary, as the case may be, in the Asset    Sale will be in the form of (I) with respect to at least 80% of such consideration,    cash, Cash Equivalents or the assumption of Indebtedness (other than Indebtedness    owed to the Borrower or any Restricted Subsidiary or any Subordinated Indebtedness)    and (II) with respect to the remainder of such consideration, if any, 

 (1)property or assets (other than    current assets as determined in accordance with Mexican GAAP, except for current    assets acquired incidental to the acquisition of assets that constitute a    line of business, or Capital Stock) to be owned by and used in a Permitted    Business of the Borrower or any Restricted Subsidiary; 

 (2)Capital Stock of (i) one or  more Persons engaged in a Permitted Business (except as otherwise permitted by  Section 5.15) which thereby become Restricted Subsidiaries, or (ii) a  Restricted Subsidiary, in each case which Capital Stock was acquired from a  third party other than the Borrower or a Restricted Subsidiary (Clauses (1)  and (2), together, "**Replacement Assets**"), in each case received at the time of such Asset    Sale; or 

 (3)promissory notes or debt  securities representing seller financing ("**Seller Financing**"); and

 (B)upon and after the Asset Sale    Amount exceeding $300,000,000, 100% of the consideration received for assets    sold by the Borrower or the Restricted Subsidiary, as the case may be, in    the Asset Sale will be in the form of:

 (1)cash, Cash Equivalents or the    assumption of Indebtedness (other than Indebtedness owed to the Borrower or    any Restricted Subsidiary or any Subordinated Indebtedness);

 (2)Replacement Assets; or 

 (3)Seller Financing.

  

The Borrower or such Restricted Subsidiary, as thecase may be, may apply the Net Cash Proceeds of any such Asset Sale to prepayobligations as required or permitted under the Existing Senior Note Indentureor the Existing Credit Facility.

   

(b)*Asset Sale Offer.* (i) To the extent all or a portion of the Net Cash Proceeds of any Asset Sale    by the Borrower or any Restricted Subsidiary are not applied as described    in the paragraph set forth above on or prior to the last day for the application    of such proceeds therefor, *provided* that the aggregate amount of such    Net Cash Proceeds not so applied and not previously the subject of an Asset    Sale Offer (at any time, the "**Unapplied Net Cash Proceeds**") is at    least $5 million (such date, the "**Asset Sale Offer Trigger Date**"),    the Borrower will make an offer to prepay an aggregate principal amount of    the Loans (the "**Asset Sale Offer**") equal to such Unapplied Net Cash    Proceeds (the "**Asset Sale Offer Amount**"). Such Asset Sale Offer shall    be made at 100% of the principal amount of the Loans to be prepaid, plus    accrued and unpaid interest thereon and all other amounts payable under    Section 5.04 in connection therewith, to the date of prepayment. The    Borrower will prepay pursuant to an Asset Sale Offer Loans from all Lenders    accepting such Asset Sale Offer (the "**Accepting Lenders**") on a *pro rata* basis (based    on the amount of Loans the Accepting Lenders have elected to have prepaid). Pending application in accordance with this Section, amounts equal to the    amount of such Asset Sale Offer will be invested in Cash Equivalents.

(ii)To conduct an Asset Sale  Offer, the Borrower shall deliver to the Administrative Agent an Asset Sale  Offer Notice offering to prepay the Loans as described above. Each Asset Sale  Offer Notice shall state, in addition to the matters specified in the  definition thereof, the prepayment date (the "**Asset Sale Offer Payment Date**"),    which shall be no later than the fifth Business Day after receipt was due    of the Lenders' election to have their Loans repaid in accordance with the    following sentence. The Administrative Agent shall forward such Asset Sale    Offer Notice to the Lenders within one Business Day following its receipt    thereof. Upon receiving an Asset Sale Offer Notice, each Lender may elect,    by notice to the Administrative Agent and the Borrower not later than five    Business Days after receipt of the Asset Sale Notice, to have its Loan prepaid    in whole or in part in integral multiples of $1,000, and shall notify the    Administrative Agent of its acceptance thereof and, if relevant, the portion    of its Loan to which such acceptance applies. Any Lender that does not deliver    notice of its election to have its Loans repaid within five Business Days    after receipt of the Asset Sale Notice, such Lender shall be deemed to have    declined the Asset Sale Offer.

(iii)On the Asset Sale Offer  Payment Date, the Borrower will, to the extent lawful, prepay the relevant  portion of each Loan as to which such Asset Sale Offer has been accepted on  the terms specified in this Section. To the extent that the aggregate amount  of Loans the Accepting Lenders elected to have prepaid (the "**Applicable Loans**")    exceeds the Asset Sale Offer Amount, the Borrower will prepay the Applicable    Loans on a *pro rata* basis (based on amounts of the Applicable Loans    as to which the Asset Sale Offer was accepted).

(iv)Upon completion of an Asset    Sale Offer, the amount of Net Cash Proceeds will be reset at zero. To the    extent that the aggregate amount of Loans prepaid pursuant to an Asset Sale    Offer is less than the Asset Sale Offer Amount, the Borrower may use any remaining    Net Cash Proceeds for general corporate purposes of the Borrower and its Subsidiaries.

(v)If at any time any non-cash    consideration received by the Borrower or any Restricted Subsidiary, as the    case may be, in connection with any Asset Sale is converted into or sold or    otherwise disposed of for cash (other than interest received with respect    to any non-cash consideration), the conversion or disposition will be deemed    to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof will    be applied in accordance with this Section 5.06 within the applicable time    period from such conversion or disposition as set forth above.

  

Section 5.07.*Limitation on the    Ownership of Capital Stock of Restricted Subsidiaries.* The Borrower    will not permit any Person other than the Borrower or another Restricted Subsidiary    to, directly or indirectly, own or control any Capital Stock of any Restricted    Subsidiary, except for:

   

(a)Capital Stock owned by such    Person (or any direct or indirect transferee thereof) as of the Effective    Date;

   

(b)directors' qualifying shares;

   

(c)any Capital Stock of any Permitted    Joint Venture; 

   

(d)the ownership by Persons other    than the Borrower, its Restricted Subsidiaries or any Affiliate of Vitro of    Capital Stock of a Restricted Subsidiary so long as the Borrower directly    or through a Restricted Subsidiary owns and controls at least 51% of the Voting    Stock of, and economic interest in, such Restricted Subsidiary;

   

(e)the sale of 100% of the shares    of the Capital Stock of any Restricted Subsidiary held by the Borrower and    its Restricted Subsidiaries to any Person other than the Borrower or another    Restricted Subsidiary effected in accordance with Section 5.06; and

   

(f)in the case of a Restricted    Subsidiary other than a Wholly Owned Restricted Subsidiary, the issuance by    that Restricted Subsidiary of Capital Stock on a pro rata basis to the Borrower    and its Restricted Subsidiaries, on the one hand, and minority holders of    the Capital Stock of such Restricted Subsidiary, on the other hand (or on    less than a pro rata basis to any minority holder).

   

Section 5.08.*Limitation on Designation    of Unrestricted Subsidiaries.* The Borrower may designate after the Effective    Date any Subsidiary of the Borrower as an "Unrestricted Subsidiary" under    this Agreement (a "**Designation**") only if:

 (i)no Default or Event of Default    has occurred and be continuing at the time of or after giving effect to such    Designation and any transactions between the Borrower or any of its Restricted    Subsidiaries and such Unrestricted Subsidiary are in compliance with Section    5.11;

 (ii)at the time of and after giving    effect to such Designation, the Required Consolidated Fixed Coverage Ratio    shall be satisfied;

 (iii)the Borrower would be  permitted to make an Investment at the time of Designation (assuming the  effectiveness of such Designation and treating such Designation as an  Investment at the time of Designation) as a Restricted Payment pursuant to the  first paragraph of Section 5.05 in an amount (the "**Designation Amount**") equal to the    amount of the Borrower's Investment in such Subsidiary on such date; and

 (iv)such Subsidiary is not a Vitro    Restricted Subsidiary.

  

(b)Neither the Borrower nor any    Restricted Subsidiary will at any time:

(i)provide credit support for,    subject any of its property or assets (other than the Capital Stock of any    Unrestricted Subsidiary) to the satisfaction of, or Guarantee, any Indebtedness    of any Unrestricted Subsidiary (including any undertaking, agreement or instrument    evidencing such Indebtedness);

(ii)be directly or indirectly liable    for any Indebtedness of any Unrestricted Subsidiary; or

(iii)be directly or indirectly liable    for any Indebtedness which provides that the holder thereof may (upon notice,    lapse of time or both) declare a default thereon or cause the payment thereof    to be accelerated or payable prior to its final scheduled maturity upon the    occurrence of a default with respect to any Indebtedness of any Unrestricted    Subsidiary; except

(A)for any non-recourse Guarantee    given solely to support the pledge by the Borrower or any Restricted Subsidiary    of the Capital Stock of any Unrestricted Subsidiary; and

(B)that the Borrower may Guarantee    any Indebtedness of an Unrestricted Subsidiary if at the time of and after    giving effect to such Guarantee, the Required Consolidated Fixed Coverage    Ratio shall be satisfied and the first paragraph of Section 5.05 and the aggregate    amount of all Guarantees of the Borrower of Indebtedness of Unrestricted Subsidiaries    shall not exceed $50 million.

  

 (c)The Borrower may revoke any    Designation of a Subsidiary as an Unrestricted Subsidiary (a "**Revocation**")    only if:

 (i)No Default or Event of Default    has occurred and be continuing at the time of and after giving effect to such    Revocation; and

 (ii)all Liens and Indebtedness of    such Unrestricted Subsidiary outstanding immediately following such Revocation    would, if Incurred at such time, have been permitted to be Incurred for all    purposes of this Agreement.

  

 (d)The Designation of a Subsidiary    of the Borrower as an Unrestricted Subsidiary will be deemed to include the    Designation of all of the Subsidiaries of such Subsidiary. All Designations    and Revocations must be evidenced by resolutions of the Board of Directors    of the Borrower, delivered to the Administrative Agent certifying compliance    with the preceding provisions.

   

Section 5.09.*Limitation on Dividend    and Other Payment Restrictions Affecting Restricted Subsidiaries.* (a) Except as provided in paragraph (b) below, the Borrower will not, and    will not cause or permit any of its Restricted Subsidiaries to, directly or    indirectly, create or otherwise cause or permit to exist or become effective    any encumbrance or restriction on the ability of any Restricted Subsidiary    to:

(i)pay dividends or make any other    distributions on or in respect of its Capital Stock to the Borrower or any    other Restricted Subsidiary or pay any Indebtedness owed to the Borrower or    any other Restricted Subsidiary;

(ii)make loans or advances to the    Borrower or any other Restricted Subsidiary; or

(iii)transfer any of its property    or assets to the Borrower or any other Restricted Subsidiary.

  

 (b)Paragraph (a) above will not    apply to encumbrances or restrictions existing under or by reason of:

(i)applicable law;

(ii)this Agreement;

(iii)any encumbrances or restrictions    in effect as of the Effective Date and any encumbrances or restrictions contained    in extensions, refinancings, renewals or replacements of any Indebtedness    outstanding on the Effective Date that are not materially more restrictive    than those in existence on the Effective Date;

(iv)customary non-assignment provisions    of any contract and customary provisions restricting assignment or subletting    in any lease governing a leasehold interest of any Restricted Subsidiary,    or any customary restriction on the ability of a Restricted Subsidiary to    dividend, distribute or otherwise transfer any asset which secures Indebtedness    secured by a Lien, in each case permitted to be Incurred under this Agreement;

(v)any instrument governing Acquired    Indebtedness not Incurred in connection with, or in anticipation or contemplation    of, the relevant acquisition, merger or consolidation, which encumbrance or    restriction is not applicable to any Person, or the properties or assets of    any Person, other than the Person or the properties or assets of the Person    so acquired;

(vi)restrictions with respect to    a Restricted Subsidiary of the Borrower imposed pursuant to a binding agreement    which has been entered into for the sale or disposition of Capital Stock or    assets of such Restricted Subsidiary; *provided*, that such restrictions    apply solely to the Capital Stock or assets of such Restricted Subsidiary    being sold;

(vii)customary restrictions imposed    on the transfer of copyrighted or patented materials;

(viii)arising in connection with the    Incurrence of Indebtedness of a Guarantor after the Effective Date; *provided*,    that such encumbrances or restrictions (1) relate solely to such Guarantor,    are required in order to effect such financing and are not more restrictive    on the ability of such Guarantor to make the payments, distributions, loans,    advances or transfers referred to above than necessarily and customarily accepted    and (2) the proposed encumbrances or restrictions, taken together with other    encumbrances or restrictions on the payments, distributions, loans, advances    or transfers referred to above in effect with respect to Restricted Subsidiaries,    do not prevent the Restricted Subsidiaries of the Borrower from making distributions    to the Borrower sufficient to pay amounts payable in respect of its Indebtedness    due during the 12 month period immediately following the Incurrence of such    Indebtedness;

(ix)arising in connection with the    Incurrence of Indebtedness by a Permitted Joint Venture after the Effective    Date, *provided*, that such encumbrances or restrictions are required    in order to effect such financing and are not more restrictive on the ability    of the applicable Permitted Joint Venture to make the payments, distributions,    loans, advances or transfers referred to above than necessarily and customarily    accepted; or

(x)customary provisions in joint    venture agreements and other similar agreements entered into in the ordinary    course of business consistent with past practice.

  

Nothing    contained in this Section 5.09 shall prevent the Borrower or any Restricted    Subsidiary from (1) creating, incurring, assuming or suffering to exist any    Liens otherwise permitted by Section 5.10 or (2) restricting the sale or other    disposition of property or assets of the Borrower or any of its Restricted    Subsidiaries that secure Indebtedness provided such restriction is otherwise    permitted by Section 5.10.

  

Section 5.10.*Limitation on Liens.*    The Borrower will not, and will not cause or permit any Restricted Subsidiary    to, directly or indirectly, incur any Liens of any kind securing Indebtedness    against or upon any assets or property or any proceeds therefrom (except for    Permitted Liens) unless contemporaneously therewith effective provision is    made to secure the Loans, or in the case of a Guarantor, the relevant Loan    Guarantee, and all other amounts due under this Agreement equally and ratably    with such Indebtedness or other obligation (or, in the event that such Indebtedness    is subordinated in right of payment to the Loans or the relevant Loan Guarantee,    as the case may be, prior to such Indebtedness or other obligation) with a    Lien on the same properties and assets securing such Indebtedness or other    obligation for so long as such Indebtedness or other obligation is secured    by such Lien.

   

Section 5.11.*Limitation on Transactions    with Affiliates.*

   

(a)The Borrower will not, and    will not permit any of its Restricted Subsidiaries to, directly or    indirectly, enter into any transaction or series of related transactions    (including, without limitation, the purchase, sale, lease or exchange of any    property or the rendering of any service) with, or for the benefit of, any    of its Affiliates (each an "**Affiliate Transaction**"), unless:

(i)the terms of such Affiliate    Transaction are no less favorable than those that could reasonably be expected    to be obtained in a comparable transaction, at the time such transaction was    entered into, on an arm's-length basis from a Person that is not an Affiliate    of the Borrower;

(ii)in the event that such Affiliate    Transaction involves aggregate payments, or transfers of property or services    with a Fair Market Value, in excess of $5 million, the terms of such Affiliate    Transaction will be approved by a majority of the members of the Board of    Directors of the Borrower (including a majority of the disinterested members    thereof), the approval to be evidenced by a Board Resolution stating that    the Board of Directors has determined that such transaction complies with    the preceding provisions; and

(iii)in the event that such Affiliate    Transaction involves aggregate payments, or transfers of property or services    with a Fair Market Value, in excess of $10 million, the Borrower will, prior    to the consummation thereof, obtain a favorable opinion as to the fairness    of such Affiliate Transaction to the Borrower and the relevant Restricted    Subsidiary (if any) from a financial point of view from an Independent Financial    Advisor and file the same with the Administrative Agent.

  

 (b)Section 5.11(a) above will not    apply to:

(i)Affiliate Transactions with    or among the Borrower and any Restricted Subsidiary or between or among Restricted    Subsidiaries, excluding any Affiliate Transaction with a Restricted Subsidiary    in which Vitro or any of its Affiliates directly or indirectly own any Capital    Stock (other than by virtue of ownership by the Borrower and its Restricted    Subsidiaries or the issuance to Vitro or any of its Affiliates of any nominal    shares of the Borrower or its Restricted Subsidiaries as required by applicable    law);

(ii)reasonable fees and compensation    paid to, and any indemnity provided on behalf of, officers, directors, employees,    consultants or agents of the Borrower or any Restricted Subsidiary as determined    in good faith by the Borrower's Board of Directors (including contributions    to employee stock option plans maintained by Vitro and its Subsidiaries);

(iii)Affiliate Transactions undertaken    in the ordinary course of business pursuant to any contractual obligations    or rights in existence on the Effective Date (as in effect on the Effective    Date) or any amendments, extensions or renewals of such contractual obligations    on comparable terms;

(iv)any Restricted Payments made    in compliance with Section 5.05;

(v)loans and advances to officers,    directors and employees of the Borrower or any Restricted Subsidiary for travel,    entertainment, moving and other relocation expenses, in each case made in    the ordinary course of business, and not exceeding in the aggregate $300,000    outstanding at any one time;

(vi)Affiliate Transactions on an    arm's-length basis with Vitro or any Subsidiary of Vitro (other than the Borrower    or any of its Subsidiaries) that consist of (1) the purchase or sales of goods    and services (including accounting services) or the leasing of real estate    or equipment in the ordinary course of business consistent with past practice;    (2) payments made to Vitro or its Subsidiaries relating to the use and development    of intellectual property; and (3) purchases, leases or sales of assets up    to an aggregate amount of $5 million in any fiscal year;

(vii)(A) the assumption of the rights    and obligations under a lease agreement relating to an airplane pursuant to    which aggregate annual payments of approximately $7 million will be made,    (B) the use of the airplane identified in the prior clause (A), or any replacement    airplane, by customers, directors and officers of Vitro and its Affiliates,    and (C) performance under outsourcing agreement entered into for hangar, maintenance,    repair and operating services relating to the airplane identified in clause    (A), or any replacement airplane, involving aggregate annual payments of up    to $8 million;

(viii)(A) loans, advances or other    extensions of credits (including guarantees) by Vitro or its Affiliates made    to the Borrower or any of its Subsidiaries and any payments made in connection    therewith, and (B) any hedging agreements or arrangements entered into between    Vitro or its Affiliates, on the one hand, and the Borrower or any of its Subsidiaries,    on the other hand, and any payments made in connection therewith, in each    case so long as the terms thereof are no less favorable to the Borrower and    its Restricted Subsidiaries than could have been obtained on an arm's-length    basis;

(ix)any management, administrative,    information technology or similar services performed by Vitro or its Affiliates    for the benefit of the Borrower or any of its Subsidiaries, and any payments    made in connection therewith, so long as the aggregate amount of all payments    made pursuant to this clause (ix) in any calendar year does not exceed 1.50%    of the net sales of the Borrower (determined on a consolidated basis) for    such year; and

(x)services rendered by Vitro or    its Affiliates for the benefit of the Borrower or any of its Subsidiaries,    and any payments in connection therewith not in excess of Vitro's or its Affiliates'    cost of rendering such services, including, without limitation, payments made    by the Borrower or any of its Subsidiaries in connection with (A) information    technology services, (B) the salaries of Vitro's Chairman of the Board and    Chief Executive Officer and (C) Clinica Vitro, El Manzano and Vitro Club.

  

Section 5.12.*Conduct of Business.* The Borrower and its Restricted Subsidiaries will not engage in any business    other than a Permitted Business, except that the Borrower and any Restricted    Subsidiary may acquire a Restricted Subsidiary after the Effective Date that    is engaged in a business other than a Permitted Business so long as it is    principally engaged in a Permitted Business.

   

Section 5.13.*Financial Statements    and Other Information.* The Borrower will furnish to the Administrative    Agent who will distribute to each Lender:

   

(a)with respect to Vitro, 

1.annual reports on Form 20-F    (or any successor form) of Vitro containing the information required to be    contained therein (or such successor form) as well as (x) segment disclosure    with respect to the Borrower and its Restricted Subsidiaries substantially    similar to that provided in the annual report on Form 20-F for Vitro for the    year ended December 31, 2004 and (y) additional information with respect to    the Borrower's and its Subsidiaries in the section "Item 5. Operating and    Financial Review and Prospects" of such annual reports that would substantially    comply with "Item 5.A. Operating Results" (including a discussion of net sales,    cost of sales, general, administrative and selling expenses, operating income    and net income for applicable periods) and "Item 5.B. Liquidity and capital    resources" as applied to the Borrower and its Subsidiaries, within the time    period required under the rules of the SEC for the filing of Form 20-F (or    any successor form) by foreign private issuers subject thereto, and

2.reports on Form 6-K (or any    successor form) of Vitro including, whether or not required, unaudited quarterly    financial statements (which shall include at least a balance sheet, income    statement and statement of changes in financial position (*cambios en la    situacion financiera*), in each case prepared in accordance with Mexican    GAAP as in effect from time to time) along with other financial information    and a discussion of results in each case with (i) at least the level of information    provided by Vitro in its Form 6-K for the second quarter of 2005 and (ii)    a discussion of net sales, cost of sales, general, administrative and selling    expenses, operating income and net income of the Borrower and its Subsidiaries    covering the periods for which the discussion of results is presented for    Vitro, within 60 days after the end of each of the first three fiscal quarters    of each fiscal year, 

  

(b)(notwithstanding that the Borrower    may not be subject to the reporting requirements of Section 13 or 15(d) of    the U.S. Securities Exchange Act) with respect to the Borrower, audited annual    and unaudited quarterly financial statements (which will include at least    a balance sheet, income statement and statement of changes in financial position    (*cambios en la situacion financiera*) and notes thereto, in each case    prepared in accordance with Mexican GAAP with an explanation of the principal    differences between Mexican GAAP and U.S. GAAP, in each case as in effect    from time to time), in each case in English and in content comparable to that    required under Regulation S-X and Regulation S-K of the SEC, with respect    to any audited annual financial statements, within the time period required    under the rules of the SEC for the filing of Form 20-F (or any successor form)    by foreign private issuers subject thereto or with respect to any unaudited    quarterly financial statements, within 60 days after the end of each of the    first three fiscal quarters of each fiscal year, *provided* that if at    any time the Borrower is subject to the reporting requirements of Section    13 or 15(d) of the Exchange Act, it shall file with the SEC the information    described above in clause (a) with respect to itself, in which case it shall    not be required to also provide the information described above in this clause    (b);

   

(c)concurrently with each delivery    of financial statements under clause (b) above, a certificate of the Chief    Financial Officer of the Borrower (i) certifying as to whether a Default has    occurred and is continuing and, if a Default has occurred and is continuing,    specifying the details thereof and any action taken or proposed to be taken    with respect thereto and (ii) stating whether any change in Mexican GAAP or    in the application thereof has occurred since the date of the Borrower's December    31, 2004 audited financial statements referred to in Section 3.06 or delivered    pursuant to this Section and, if any such change has occurred, specifying    the effect of such change on the financial statements accompanying such certificate;    and

   

(d)promptly following any request    therefor, such other information regarding the operations, business affairs    and financial condition of Borrower or any of its Subsidiaries, or compliance    with the terms of any Loan Document, as the Administrative Agent or any Lender    may reasonably request.

   

Section 5.14.*Payment of Additional    Amounts.*

   

(a)All payments by the Borrower    in respect of the Loans or by a Guarantor in respect of its Loan Guarantee    shall be made free and clear of and without deduction or withholding for or    on account of any present or future taxes, duties, assessments, fees or    other governmental charges ("**Taxes**") imposed or levied by or on    behalf of Mexico or of any other jurisdiction in which the Borrower or any    Guarantor is incorporated or any political subdivision or taxing authority    thereof or therein (any of the aforementioned, a "**Taxing Jurisdiction**"), unless    such withholding or deduction is required by law.

   

(b)Subject to Section 5.14(c),    if the Borrower or a Guarantor is required by the law of any Taxing Jurisdiction    to make any such withholding or deduction, the Borrower or such Guarantor    shall (i) pay to the Lender Parties such additional amounts ("**Additional    Amounts**") as may be necessary so that every net payment made by the Borrower    on the Loans after deduction or withholding for or on account of any such    Taxes (including deductions applicable to Additional Amounts payable under    this paragraph (b)) shall not be less than the amount the Lender Parties would    have received with respect to such Loans had no such deduction or withholding    been made; and (ii) pay the full amount deducted or withheld to the relevant    Governmental Authority in accordance with applicable law.

   

(c)The obligation to pay Additional    Amounts set forth in (b)Section 5.14(b) shall not apply to:

(i)any tax, duty, assessment, fee    or other governmental charge that would not have been imposed but for the    existence of any present or former connection, including a permanent establishment    or fixed base, between such Lender Party and Mexico or any other applicable    Taxing Jurisdiction imposing such governmental charge other than by the receipt    of such payment and the terms of the Loan Documents; 

(ii)any estate, inheritance, gift,    sale, transfer, personal property or similar tax, assessment or other governmental    charge; or

(iii)in the case of any Lender Party    that is or was a Foreign Financial Institution (as defined below) on the date    such Person became a Lender and thus subject to the requirements of paragraph    (h) below, any withholding taxes imposed as a result of a failure of such    Lender to comply with its obligations set forth in paragraph (h) below, subject    to the exceptions and limitations provided therein; *provided* that the    taxes excluded shall be deemed to include only withholdings or deductions    payable by the Borrower in respect of payments hereunder in excess of a rate    equal to the rate applicable if there had been no such failure by such Lender    Party to comply with paragraph (h) below.

  

(d)At least 30 calendar days prior    to each date on which any payment under or with respect to the Loans is due    and payable (or, as early as practicable, if the obligation to pay Additional    Amounts arises after the 30th day prior to such date), if the Borrower or    a Guarantor will be obligated to pay Additional Amounts with respect to such    payment in an amount different than the Additional Amounts payable on the    date hereof, the Borrower or such Guarantor shall deliver to the Administrative    Agent an Officers' Certificate stating the fact that such Additional Amounts    will be payable and the amounts so payable, and setting forth such other information    necessary to enable the Administrative Agent to pay such Additional Amounts    to Lenders on the payment date. In the absence of any such certificate, the    Administrative Agent may assume that no such deduction or withholding shall    be required. The Borrower agrees to indemnify the Administrative Agent for,    and to hold it harmless against, any loss, liability or expense incurred without    bad faith on its part arising out of or in connection with actions taken or    omitted by it in reliance, absent manifest error, on any certificate furnished    pursuant to this Section 5.14(d) or not furnished. The obligations of the    Borrower under this Section 5.14(d) shall survive the payment of the Loans,    the resignation or removal of the Administrative Agent and/or the termination    of this Agreement.

   

(e)The Borrower or Guarantor, as    the case may be, shall provide to the Administrative Agent documentation evidencing    payment of withholding taxes within 30 days after payment thereof. Copies    of such documentation shall be made available to Lenders upon written request    therefor. 

   

(f)The Borrower or a Guarantor    will pay any stamp, issue, registration, documentary or other similar taxes    and duties, including interest and penalties in Mexico or the United States    or any political subdivision thereof or taxing authority of or in the foregoing    in respect of the Borrowing.

   

(g)Whenever in this Agreement there    is mentioned, in any context:

(i)the payment of principal, interest    or additional interest on the Loans;

(ii)redemption or repurchase prices    in respect of the Loans; or

(iii)any other amount payable on    or with respect to any of the Loans,

  

such reference will be deemed to include payment ofAdditional Amounts as described under this Section 5.14 to the extent that, insuch context, Additional Amounts are, were or would be payable in respectthereof.

 

(h)Each Lender Party that is a    Foreign Financial Institution on the Effective Date (or, if such Lender    Party becomes a Lender after the Effective Date as a result of an    assignment, on the date of such assignment) shall, at the request of the    Borrower, made pursuant to a written notice given at least 30 days prior to    the relevant filing date, use reasonable commercial efforts to file with the    Ministry of Finance or, where applicable, in accordance with the laws of any    jurisdiction outside Mexico from or through which payments hereunder or    under any Notes are made, a form, certificate or other similar document    requested by the Borrower (including without limitation any such form,    certificate or other similar document that may be required to maintain such    Lender Party's status as a Foreign Financial Institution) if (1) such filing    is required under applicable law or a treaty for the avoidance of double    taxation then in effect, (2) such filing would avoid the need for making any    tax withholding or deduction, or reduce the tax rate of any such withholding    or deduction which may thereafter accrue to or for the account of such    Lender Party pursuant to this Section and (3) such filing would not, in the    good faith judgment of such Lender Party, require such Lender Party to    disclose any confidential or proprietary information or be otherwise    disadvantageous to such Lender Party. Notwithstanding the foregoing, it is    understood and agreed that nothing in this Section shall interfere with the    rights of any Lender Party to conduct its fiscal or tax affairs in such    manner as it deems appropriate. As used herein, "**Foreign    Financial Institution**" means an institution registered as a foreign financial    institution with the Ministry of Finance in the registry referred to in Article    197 of Mexico's Income Tax Law and any successor provision thereof, for purposes    of *fraccion I, inciso a), subinciso 2,*of Article 195 of Mexico's Income    Tax Law. 

   

(i)The Borrower shall indemnify    each Lender against, and reimburse each Lender on demand for, any Taxes and    any loss, liability, claim or expense, including interest, penalties and legal    fees, that such Lender may incur at any time arising out of or in connection    with any failure of the Borrower to make any payment of Taxes when due *provided*    that the Borrower shall not be obligated to make payment to the Lender pursuant    to this clause (i) in respect of penalties, interest and other liabilities    attributable to any Taxes, if (i) written demand therefor has not been made    by the Lender within 60 days from the date on which the Lender had actual    knowledge of the imposition of Taxes by the relevant taxing or governmental    authority or (ii) such penalties, interest and other liabilities are attributable    to the gross negligence or willful misconduct of the Lender. After the Lender    learns of the imposition of Taxes, the Lender shall act in good faith to notify    the relevant Borrower of its obligations hereunder.

   

Section 5.15*. Limitation On Merger,Consolidation And Sale Of Assets.*

   

(a)The Borrower will not, in a    single transaction or series of related transactions, consolidate or merge    with or into any Person (whether or not the Borrower is the surviving or continuing    Person), or sell, assign, transfer, lease, convey or otherwise dispose of    (or cause or permit any Restricted Subsidiary to sell, assign, transfer, lease,    convey or otherwise dispose of) all or substantially all of the Borrower's    properties and assets (determined on a consolidated basis for the Borrower    and its Restricted Subsidiaries), to any Person unless:

(i)either:

(A)the Borrower will be the surviving    or continuing corporation, or

(B)the Person (if other than the  Borrower) formed by such consolidation or into which the Borrower is merged or  the Person which acquires by sale, assignment, transfer, lease, conveyance or  other disposition the properties and assets of the Borrower and of the  Borrower's Restricted Subsidiaries substantially as an entirety (the "**Successor    Borrower**"):

(1)shall be a corporation organized    and validly existing under the laws of Mexico, and

(2)will expressly assume, by supplemental    agreement (in form and substance satisfactory to the Administrative Agent),    executed and delivered to the Administrative Agent, the due and punctual payment    of the principal of, and premium, if any, and interest on all of the Loans    and the performance and observance of every covenant of the Loans, this Agreement,    the Notes and each other Loan Document on the part of the Borrower to be performed    or observed;

  (ii)immediately after giving effect    to such transaction and the assumption contemplated by Section 5.15(a)(i)(B)(y)    above (including giving effect on a pro forma basis to any Indebtedness, including    any Acquired Indebtedness, Incurred or anticipated to be Incurred in connection    with or in respect of such transaction), the Borrower or such Successor Borrower,    as the case may be:

(A)will have a Consolidated Net    Worth equal to or greater than the Consolidated Net Worth of the Borrower    immediately prior to such transaction, and

(B)will be able to satisfy the    Required Consolidated Fixed Coverage Ratio.

(iii)immediately before and immediately    after giving effect to such transaction and the assumption contemplated by    Section 5.15(a)(i)(B)(2) above (including, without limitation, giving effect    on a pro forma basis to any Indebtedness, including any Acquired Indebtedness,    Incurred or anticipated to be Incurred and any Lien granted in connection    with or in respect of the transaction), no Default or Event of Default has    occurred or be continuing;

(iv)the Borrower or the Successor    Borrower has delivered to the Administrative Agent an Officers' Certificate    and an Opinion of Counsel, each stating that the consolidation, merger, sale,    assignment, transfer, lease, conveyance or other disposition comply with the    applicable provisions of this Agreement and that all conditions precedent    in this Agreement relating to the transaction have been satisfied; and

(v)each Guarantor (including Persons    that become Guarantors as a result of the transaction) has confirmed by an    addendum hereto (in form and substance reasonably satisfactory to the Administrative    Agent) that its Loan Guarantee will apply for the Obligations of the Successor    Borrower in respect of this Agreement and the other Loan Documents.

  

For purposes of this Section, the transfer (by lease,assignment, sale or otherwise, in a single transaction or series oftransactions) of all or substantially all of the properties or assets of one ormore Restricted Subsidiaries of the Borrower, the Capital Stock of whichconstitutes all or substantially all of the properties and assets of theBorrower (determined on a consolidated basis for the Borrower and itsRestricted Subsidiaries), will be deemed to be the transfer of all orsubstantially all of the properties and assets of the Borrower *provided*that the provisions of Section 5.15(a)(i) and Section 5.15(a)(v) shall notapply in respect of any such transaction to any Person (other than theBorrower) that otherwise would be a surviving or continuing corporation subjectto Section 5.15(a)(i)(A) or that would be required to assume the Obligations ofthe Borrower under the Loan Documents subject to Section 5.15(a)(i)(B), to theextent such Person is or becomes a Guarantor in accordance with Section 5.15(d)below.

 

(b)The provisions of Section 5.15(a)    above will not apply to:

(i)any transfer of the properties    or assets of the Borrower or a Restricted Subsidiary to the Borrower or a    Guarantor;

(ii)any merger of a Restricted Subsidiary    into the Borrower or a Guarantor;

(iii)any merger of the Borrower into    a Wholly Owned Subsidiary of the Borrower created for the purpose of holding    the Capital Stock of the Borrower,

  

so long as, in each case the Indebtedness of theBorrower and its Restricted Subsidiaries taken as a whole is not increasedthereby and such transferee or surviving or continuing person, as applicable,assumes the Obligations under and becomes a party to the applicable LoanDocuments in accordance with the terms thereof.

 

(c)Upon any consolidation, combination    or merger or any transfer of all or substantially all of the properties and    assets of the Borrower and its Restricted Subsidiaries in accordance with    this Section 5.15, in which the Borrower is not the continuing corporation,    the Successor Borrower formed by such consolidation or into which the Borrower    is merged or to which such conveyance, lease or transfer is made will succeed    to, and be substituted for, and may exercise every right and power of, the    Borrower under this Agreement and the Loans with the same effect as if such    Successor Borrower had been named as such.

   

(d)Each Guarantor will not, and    the Borrower will not cause or permit any Guarantor to, consolidate with or    merge into, or sell or dispose of all or substantially all of its assets to,    any Person (other than the Borrower) that is not a Guarantor unless:

   

(i)such Person (if such Person    is the surviving entity) assumes all of the obligations of such Guarantor    in respect of its Loan Guarantee by executing an accession agreement substantially    in the form of Exhibit D and providing the Administrative Agent with an Officers'    Certificate and Opinion of Counsel, and such transaction is otherwise in compliance    with this Agreement;

(ii)such Loan Guarantee is to be    released as provided under Article 8; or

(iii)such sale or other disposition    of substantially all of such Guarantor's assets is made in accordance with    Section 5.06.

  

Section 5.16*. Use of Proceeds.*The proceeds of the Loans will be used by the Borrower solelyto (i) repay existing Indebtedness of the Borrower or an Affiliate of the Borrowerand (ii) pay fees and expenses relating to the transactions contemplatedhereby. No part of the proceeds of any Loan will be used, directly orindirectly, for any purpose that entails a violation of any of the Regulationsof the Board of Governors of the Federal Reserve System of the United States, including Regulations T, U and X.

 

Section 5.17*. Additional Guarantors.*If at any time any Subsidiary is required to become a"Guarantor" pursuant to the Existing Credit Facility, such Subsidiary shall simultaneouslyexecute an addendum to this Agreement in form and substance reasonablysatisfactory to the Administrative Agent in order to become a Guarantor partyhereto.

 

**Article 6    Events of Default**

 

If any of the following events ("**Events of Default**")shall occur:

(a)the Borrower shall fail to pay    any principal of or premium on any Loan when the same shall become due, whether    at the due date thereof or at a date fixed for prepayment thereof or otherwise;

(b)the Borrower shall fail to    pay when due any interest on any Loan or any fee or other amount (including    Additional Amounts, but excluding an amount referred to in clause (a) above)    payable under any Loan Document, and such failure shall continue unremedied    for a period of three Business Days;

(c)any representation, warranty    or certification made or deemed made by or on behalf of the Borrower or any    of its Subsidiaries in or in connection with any Loan Document or any amendment    or modification thereof or waiver thereunder, or in any report, certificate,    financial statement or other document furnished pursuant to or in connection    with any Loan Document or any amendment or modification thereof or waiver    thereunder, shall prove to have been incorrect when made or deemed made;

(d)the Borrower shall fail to observe    or perform any covenant or agreement contained in Article 5 except any covenant    or agreement in Section 5.01, 5.02, 5.12, 5.13, 5.14 or 5.15;

(e)any Credit Party shall fail    to observe or perform any covenant or agreement contained in any Loan Document    (other than those specified in clause (a), (b) or (d) above), and such failure    shall continue unremedied for a period of 30 days after written notice thereof    from the Administrative Agent to the Borrower (which notice will be given    at the request of any Lender);

(f)default by the Borrower or any    Restricted Subsidiary under any Indebtedness which:

(i)is caused by a failure to pay    principal of or premium, if any, or interest on such Indebtedness prior to    the expiration of any applicable grace period provided in such Indebtedness    on the date of such default; or

(ii)results in the acceleration    of such Indebtedness prior to its stated maturity;

and the principal or accreted amount of Indebtednesscovered by (i) or (ii) at the relevant time aggregates $25 million or more;

(g)a court having jurisdiction    in the premises enters a decree or order for (i) relief in respect of the    Borrower or any of its Significant Subsidiaries (or group of Subsidiaries    that, taken together, would constitute a Significant Subsidiary) in an involuntary    case under any applicable bankruptcy, *concurso mercantil*, insolvency    or other similar law of Mexico or the United States now or hereafter in effect,    (ii) appointment of a receiver, liquidator, assignee, custodian, trustee,    *liquidador, conciliador*, *sIndico*, sequestrator or similar official    of the Borrower or any of its Significant Subsidiaries (or group of Subsidiaries    that, taken together, would constitute a Significant Subsidiary) or for all    or substantially all of the property and assets of the Borrower or any of    its Significant Subsidiaries (or group of Subsidiaries that, taken together,    would constitute a Significant Subsidiary) or (iii) the winding up or liquidation    of the affairs of the Borrower or any of its Significant Subsidiaries (or    group of Subsidiaries that, taken together, would constitute a Significant    Subsidiary) and, in each case, such decree or order shall remain unstayed    and in effect for a period of 60 consecutive days, or any involuntary proceeding    shall be commenced or an involuntary petition shall be filed seeking the relief    mentioned in sections (i)), (ii) or (iii) above, and such proceeding or petition    shall continue undismissed for a period of 60 consecutive days;

(h)the Borrower or any of its Significant    Subsidiaries (or group of Subsidiaries that, taken together, would constitute    a Significant Subsidiary) (i) commences a voluntary case under any applicable    bankruptcy, *concurso mercantil*, insolvency, suspension of payments    or other similar law of Mexico or the United States now or hereafter in effect,    or consents to the entry of an order for relief in an involuntary case under    any such law, (ii) consents to the appointment of or taking possession by    a receiver, liquidator, assignee, custodian, trustee, *liquidador*, *conciliador*,    *sIndico*, sequestrator or similar official of the Borrower or any of    its Significant Subsidiaries (or group of Subsidiaries that, taken together,    would constitute a Significant Subsidiary) or for all or substantially all    of the property and assets of the Borrower or any of its Significant Subsidiaries    (or group of Subsidiaries that, taken together, would constitute a Significant    Subsidiary), (iii) effects any general assignment for the benefit of creditors,    (iv) files a petition or answer or consent seeking reorganization or relief    under any Bankruptcy Law (as defined in the Existing Senior Note Indenture)    or (v) approves any plan or proposal for the liquidation or dissolution of    the Borrower or any of its Significant Subsidiaries (or group of Subsidiaries    that, taken together, would constitute a Significant Subsidiary);

(i)one or more judgments for the    payment of money in an aggregate amount exceeding $25 million (or its equivalent    in other currencies) shall be rendered against one or more of the Borrower    or any of its Restricted Subsidiaries and shall remain undischarged for a    period of 60 consecutive days during which execution shall not be effectively    stayed, or any action shall be legally taken by a judgment creditor to attach    or levy upon any asset of the Borrower or any of its Restricted Subsidiaries    to enforce any such judgment;

(j)a Change of Control shall occur;

(k)any Guarantor's Loan Guarantee    shall at any time fail to constitute a valid and binding agreement of such    Guarantor or any party shall so assert in writing;

(l)the Borrower or any of its Restricted    Subsidiaries shall fail to pay when due any and all amounts payable as required    under IMSS, INFONAVIT or SAR, except to the extent that such payments are    disputed in good faith through appropriate proceedings and proper reserves    therefor are maintained by the relevant Person or Persons in accordance with    Mexican GAAP, and the outstanding amount of such due but unpaid payments does    not in the aggregate exceed at any time $25 million; 

(m)any Governmental Authority (or    any Person acting or purporting to act under the authority of any such Governmental    Authority) shall take any action to condemn, seize, nationalize, expropriate    or otherwise compulsorily acquire all or any substantial part of the consolidated    assets of the Borrower and its Subsidiaries, taken as a whole; 

(n)Vitro shall (i) during any fiscal    year prior to fiscal year 2007, make Dividend Payments in an aggregate amount    exceeding $8,500,000 (or, in each case, its equivalent in Pesos or other currencies)    in such fiscal year or (ii) during fiscal year 2007 until payment in full    of all amounts payable by the Borrower hereunder and under the other Loan    Documents, make any Dividend Payment; or

(o)any restriction or requirement    shall have been imposed or amended after the date hereof, whether by legislative    enactment, decree, regulation, order or otherwise, which limits the acquisition    or the transfer of foreign exchange by the Borrower or a Guarantor, and such    restriction or requirement shall have the effect of preventing the Borrower    or a Guarantor from performing in any material respect its material obligations    under this Agreement, or under any other Loan Document, including, without    limitation, all payment obligations in Dollars;

   

then, and in every such event (except an event withrespect to the Borrower described in clause (g)or (h) above), and at any timethereafter during the continuance of such event, the Administrative Agent may,and at the request of the Required Lenders shall, by written notice to theBorrower, take either or both of the following actions, at the same ordifferent times: (i) if the Loans have not been made, terminate theCommitments, and thereupon the Commitments shall terminate immediately, and (ii) declare the Loans then outstanding to be due and payable in whole (or in part, inwhich case any principal not so declared to be due and payable may thereafterbe declared to be due and payable), and thereupon the principal of the Loans sodeclared to be due and payable, together with accrued interest thereon and allfees and other obligations of the Borrower accrued hereunder, shall become dueand payable immediately, without presentment, demand, protest or other noticeof any kind, all of which are waived by the Borrower; and in the case of anyevent with respect to the Borrower described in clause (g) or (h) above, theCommitments shall automatically terminate and the principal of the Loans thenoutstanding, together with accrued interest thereon and all fees and otherobligations of the Borrower accrued hereunder, shall automatically become dueand payable, without presentment, demand, protest or other notice of any kind,all of which are waived by the Borrower.

 

**Article 7    The Administrative Agent**

   

Section 7.01.*Appointment andAuthorization.*Each Lender Party irrevocably appoints the AdministrativeAgent and authorizes the Administrative Agent to take such actions on its behalfand to exercise such powers as are delegated to the Administrative Agent by theterms of the Loan Documents, together with such actions and powers as arereasonably incidental thereto. 

 

Section 7.02*. Rights and Powers as aLender.*A bank serving as the Administrative Agent shall, inits capacity as a Lender, have the same rights and powers as any other Lenderand may exercise the same as though it were not the Administrative Agent. Suchbank and its Affiliates may accept deposits from, lend money to and generallyengage in any kind of business with the Borrower or any of its Subsidiaries orAffiliate thereof as if it were not the Administrative Agent.

 

Section 7.03.*Limited Dutiesand Responsibilities*. The Administrative Agent shall not have any dutiesor obligations except those expressly set forth in the Loan Documents. Withoutlimiting the generality of the foregoing, (a) the Administrative Agent shallnot be subject to any fiduciary or other implied duties, regardless of whethera Default has occurred and is continuing, (b) the Administrative Agent shallnot have any duty to take any discretionary action or exercise anydiscretionary powers, except discretionary rights and powers expresslycontemplated by the Loan Documents that the Administrative Agent is required inwriting to exercise by the Required Lenders (or such other number or percentageof the Lenders as shall be necessary under the circumstances as provided in Section9.02) and (c) except as expressly set forth in the Loan Documents, theAdministrative Agent shall not have any duty to disclose, and shall not beliable for any failure to disclose, any information relating to the Borrower orany of its Subsidiaries that is communicated to or obtained by the bank servingas Administrative Agent or any of its Affiliates in any capacity. TheAdministrative Agent shall not be liable for any action taken or not taken byit with the consent or at the request of the Required Lenders (or such othernumber or percentage of the Lenders as shall be necessary under thecircumstances as provided in Section 9.02) or in the absence of its own grossnegligence or willful misconduct. The Administrative Agent shall be deemed notto have knowledge of any Default unless and until written notice thereof isgiven to the Administrative Agent by the Borrower or a Lender, and theAdministrative Agent shall not be responsible for or have any duty to ascertainor inquire into (i) any statement, warranty or representation made in or inconnection with any Loan Document, (ii) the contents of any certificate, reportor other document delivered thereunder or in connection therewith, (iii) the performance or observance of any of the covenants, agreements or other terms orconditions set forth in any Loan Document, (iv)the validity, enforceability,effectiveness or genuineness of any Loan Document or any other agreement,instrument or document or (v) the satisfaction of any condition set forth in Article4 or elsewhere in any Loan Document, other than to confirm receipt of itemsexpressly required to be delivered to the Administrative Agent.

 

Section 7.04.*Authority toRely on Certain Writings, Statements and Advice*. The Administrative Agentshall be entitled to rely on, and shall not incur any liability for relying on,any notice, request, certificate, consent, statement, instrument, document orother writing believed by it to be genuine and to have been signed or sent bythe proper Person. The Administrative Agent also may rely on any statementmade to it orally or by telephone and believed by it to be made by the properPerson, and shall not incur any liability for relying thereon. TheAdministrative Agent may consult with legal counsel (who may be counsel for theBorrower or any of its Subsidiaries), independent accountants and other expertsselected by it, and shall not be liable for any action taken or not taken by itin accordance with the advice of any such counsel, accountants or experts.

 

Section 7.05.*Sub-Agents andRelated Parties*. The Administrative Agent may perform any and all itsduties and exercise its rights and powers by or through one or more sub-agentsappointed by it. The Administrative Agent and any such sub-agent may performany and all its duties and exercise its rights and powers through theirrespective Related Parties. The exculpatory provisions of the precedingSections of this Article shall apply to any such sub-agent and to the RelatedParties of the Administrative Agent and any such sub-agent, and shall apply toactivities in connection with the syndication of the credit facilities providedfor herein as well as activities as Administrative Agent.

 

Section 7.06.*Resignation;Successor Administrative Agent*. Subject to the appointment and acceptanceof a successor Administrative Agent as provided in this Section, theAdministrative Agent may resign at any time by notifying the Lenders and theBorrower. Upon any such resignation, the Required Lenders shall have theright, with the approval of Borrower (unless an Event of Default exists, inwhich case the approval of the Borrower will not be required), to appoint asuccessor. If no successor shall have been so appointed by the RequiredLenders with the approval of the Borrower, if required, and shall have acceptedsuch appointment within 30 days after the retiring Administrative Agent givesnotice of its resignation, then the retiring Administrative Agent may, onbehalf of the Lenders, appoint a successor Administrative Agent which shall bea bank with an office in New York, New York, having a combined capital andsurplus of at least $500 million. Upon acceptance of its appointment asAdministrative Agent hereunder by a successor, such successor shall succeed toand become vested with all the rights, powers, privileges and duties of theretiring Administrative Agent, and the retiring Administrative Agent shall bedischarged from its duties and obligations hereunder. The fees payable by theBorrower to a successor Administrative Agent shall be the same as those payableto its predecessor unless otherwise agreed by the Borrower and such successor. After the Administrative Agent's resignation hereunder, the provisions of thisArticle and Section 9.03 shall continue in effect for the benefit of suchretiring Administrative Agent, its sub-agents and their respective RelatedParties in respect of any actions taken or omitted to be taken by any of themwhile the retiring Administrative Agent was acting as Administrative Agent.

 

Section 7.07.*CreditDecisions by Lenders*. Each Lender acknowledges that it has, independentlyand without reliance on the Administrative Agent or any other Lender and basedon such documents and information as it has deemed appropriate, made its owncredit analysis and decision to enter into this Agreement. Each Lender alsoacknowledges that it will, independently and without reliance on theAdministrative Agent or any other Lender and based on such documents andinformation as it shall from time to time deem appropriate, continue to makeits own decisions in taking or not taking action under or based on thisAgreement, any other Loan Document or related agreement or any documentfurnished hereunder or thereunder.

 

**Article 8    Loan Guarantees**

   

Section 8.01*. Loan Guarantees.*Each Guarantor unconditionally guarantees the full and punctual payment    of (x) all principal of all Loans outstanding from time to time under this    Agreement, (y) all interest (including any interest that accrues after the    commencement of any case, proceeding or other action relating to the    bankruptcy, insolvency or reorganization of the Borrower (or would accrue    but for the operation of applicable bankruptcy or insolvency laws), whether    or not such interest is allowed or allowable as a claim in any such    proceeding) on such Loans and (z) all other amounts now or hereafter payable    by the Borrower pursuant to the Loan Documents (the amounts described in    clauses (x), (y) and (z), collectively, the "**Obligations**") when due (whether at stated maturity,    upon acceleration or otherwise). If the Borrower fails to pay any Obligation    punctually when due, each Guarantor agrees that it will forthwith on demand    pay the amount not so paid at the place and in the manner specified in this    Agreement, including without limitation with respect to Additional Amounts    as provided under Section 5.14, which shall apply to each Guarantor in making    payments hereunder as fully as though such Guarantor were the "Borrower" in    making payments hereunder.

 

Section 8.02*. GuaranteesUnconditional*. The obligations of each Guarantor under its Loan Guaranteeshall be unconditional and absolute and, without limiting the generality of theforegoing, shall not be released, discharged or otherwise affected by:

(a)any extension, renewal, settlement,    compromise, waiver or release in respect of any obligation of the Borrower,    any other Guarantor or any other Person under any Loan Document, by operation    of law or otherwise;

(b)any modification or amendment    of or supplement to any Loan Document;

(c)any release, impairment, non-perfection    or invalidity of any direct or indirect security for any obligation of the    Borrower, any other Guarantor or any other Person under any Loan Document;

(d)any change in the corporate    existence, structure or ownership of the Borrower, any other Guarantor or    any other Person or any of their respective subsidiaries, or any insolvency,    bankruptcy, *concurso mercantil*, reorganization or other similar proceeding    affecting the Borrower, any other Guarantor or any other Person or any of    their assets or any resulting release or discharge of any obligation of the    Borrower, any other Guarantor or any other Person under any Loan Document;

(e)the existence of any claim,    set-off or other right that such Guarantor may have at any time against the    Borrower, any other Guarantor, any Lender Party or any other Person, whether    in connection with the Loan Documents or any unrelated transactions, *provided*    that nothing herein shall prevent the assertion of any such claim by separate    suit or compulsory counterclaim;

(f)any invalidity or unenforceability    relating to or against the Borrower, any other Guarantor or any other Person    for any reason of any Loan Document, or any provision of applicable law or    regulation purporting to prohibit the payment of any Obligation by the Borrower,    any other Guarantor or any other Person; or

(g)any other act or omission to    act or delay of any kind by the Borrower, any other Guarantor, any other party    to any Loan Document, any Lender Party or any other Person, or any other circumstance    whatsoever that might, but for the provisions of this clause (g), constitute    a legal or equitable discharge of or defense to any obligation of any Guarantor    hereunder.

 

Section 8.03*. Release ofGuarantees*. (a) All the Guarantees will be released when all theCommitments have expired or terminated and the principal of and interest oneach Loan and all fees payable hereunder have been paid in full. If at anytime any payment of an Obligation is rescinded or must be otherwise restored orreturned upon the insolvency or receivership of the Borrower or otherwise, the LoanGuarantees shall be reinstated with respect thereto as though such payment hadbeen due but not made at such time. 

 

(b)If all the capital stock of a    Guarantor or all the assets of a Guarantor are sold to a Person other than    the Borrower or one of its Subsidiaries in a transaction permitted by this    Agreement (any such sale, a "**Sale of Guarantor**"), the Administrative    Agent shall release such Guarantor from its Loan Guarantee; *provided*    that, if such sale is a Prepayment Event, arrangements satisfactory to the    Administrative Agent have been made to apply the Net Proceeds thereof as required    by this Agreement. Such release shall not require the consent of any Lender    Party, and the Administrative Agent shall be fully protected in relying on    a certificate of the Borrower as to whether any particular sale constitutes    a Sale of Guarantor.

   

(c)In addition to any release permitted    by subsection (b), the Administrative Agent may release any Loan Guarantee    with the prior written consent of the Required Lenders; *provided* that    any release of all or substantially all the Loan Guarantees shall require    the consent of all the Lenders.

   

Section 8.04*. Waiver by Guarantors*. Each Guarantor irrevocably waives acceptance hereof, presentment, demand,    protest and any notice not provided for herein, as well as any requirement    that at any time any action be taken by any Person against the Borrower, any    other Guarantor or any other Person. Each Guarantor irrevocably waives acceptance    hereof, presentment, demand, protest and any notice not provided for herein,    as well as any requirement that at any time any action be taken by any Person    against the Borrower, any other Credit Party or any other Person, prior to    making a claim against such Guarantor, and any right to which it may otherwise    be entitled to (i) require any Lender or the Administrative Agent to sue and/or    complete an action against the Borrower or any other Credit Party prior to    a claim being made against such Guarantor hereunder; (ii) have the assets    of any the Borrower or any other Credit Party first be used and/or applied    in full or in part as payment of the Borrower's or any such other Credit Party's    obligations under the Loan Document prior to any amounts being claimed from    or paid by such Guarantor hereunder; or (iii) have its obligations hereunder    divided among itself and one or more other Credit Parties, if such Guarantor's    obligations would be less than the full amount claimed hereunder. In addition,    each Guarantor hereby waives, to the extent applicable, the benefits of *orden,    excusion, division, prorroga* and *quita* and any benefits it may    have under any of Articles 2813 through 2823, Articles 2839 and 2840 or    Articles 2844 through 2849 (in each case inclusive) of Mexico's Federal    Civil Code (the "**Civil Code**"), and the correlative articles of the civil codes    of each political subdivision of Mexico. The obligations assumed by each    Guarantor hereunder shall not be affected by the absence of judicial request    of payment by any Lender or the Administrative Agent to the Borrower, and    whether or not any Lender or the Administrative Agent takes any action within    the time set forth in Articles 2848 and 2849 of the Civil Code, and each Guarantor    hereby expressly waives the provisions of such Articles.

   

Section 8.05*. Subrogation.*AGuarantor that makes a payment with respect to a Obligation hereunder shall besubrogated to the rights of the payee against the Borrower with respect to suchpayment; provided that no Guarantor shall enforce any payment by way ofsubrogation against the Borrower, or by reason of contribution against anyother Guaranteeing Person of such Obligation, until all the Commitments haveexpired or terminated and the principal of and interest on each Loan and allfees payable hereunder have been paid in full.

 

Section 8.06*. Stay ofAcceleration*. If acceleration of the time for payment of any Obligation bythe Borrower is stayed by reason of the insolvency or receivership of theBorrower or otherwise, all Obligations otherwise subject to acceleration underthe terms of any Loan Document shall nonetheless be payable by the Guarantorshereunder forthwith on demand by the Administrative Agent.

 

Section 8.07.*Continuing LoanGuarantee*. Each Loan Guarantee is a continuing guarantee, shall be bindingon the relevant Guarantor and its successors and assigns, and shall beenforceable by the Administrative Agent or the Lender Parties. If all or partof any Lender Party's interest in any Obligation is assigned or otherwisetransferred as permitted hereby, the transferor's rights under each Loan Guarantee,to the extent applicable to the obligation so transferred, shall automaticallybe transferred with such obligation.

 

**Article 9    Miscellaneous**

 

Section 9.01.*Notices*. Except in the case of notices and other communications expressly permitted tobe given by telephone, all notices and other communications provided for hereinshall be in writing and shall be delivered by hand or overnight courierservice, mailed by certified or registered mail or sent by telecopy, asfollows:

a)if to the Borrower, to it at    Av. Ricardo Margain 440, Col. Valle del Campestre, 66265 San Pedro Garza GarcIa, N.L. Mexico, Attention of    Departamento JurIdico (Telecopy No. +52 (81) 8335-8319);

(b)if to any Guarantor, in care    of the Borrower as described in clause (a) above;

(c)if to the Administrative Agent,    to it at Eleven Madison Avenue, OMA-2 New York, NY 10010, Attention of John    Burke (Telecopy No. (212) 325 8304); and

(d)if to any other Lender, to it    at its address (or telecopy number) set forth in its Administrative Questionnaire.

   

Any party hereto may change its address or telecopynumber for notices and other communications hereunder by notice to theAdministrative Agent and the Borrower. All notices and other communicationsgiven to any party hereto in accordance with the provisions of this Agreementwill be deemed to have been given on the date of receipt.

 

Section 9.02.*Waivers;Amendments*. (a) No failure or delay by any Lender Party in exercising anyright or power hereunder or under any other Loan Document shall operate as awaiver thereof, nor shall any single or partial exercise of any such right orpower, or any abandonment or discontinuance of steps to enforce such a right orpower, preclude any other or further exercise thereof or the exercise of anyother right or power. The rights and remedies of the Lender Parties under theLoan Documents are cumulative and are not exclusive of any rights or remediesthat they would otherwise have. No waiver of any provision of any LoanDocument or consent to any departure by any Credit Party therefrom shall in anyevent be effective unless the same shall be permitted by subsection (b) of thisSection, and then such waiver or consent shall be effective only in thespecific instance and for the purpose for which given. Without limiting thegenerality of the foregoing, the making of a Loan shall not be construed as awaiver of any Default, regardless of whether any Lender Party had notice orknowledge of such Default at the time.

 

(b)No Loan Document or provision    thereof may be waived, amended or modified except, in the case of this Agreement,    by an agreement or agreements in writing entered into by the Borrower and    the Required Lenders or, in the case of any other Loan Document, by an agreement    or agreements in writing entered into by the parties thereto with the consent    of the Required Lenders; *provided* that no such agreement shall:

(i)increase the Commitment of any    Lender without its written consent;

(ii)reduce the principal amount    of any Loan or reduce the rate of interest thereon, or reduce any fee payable    hereunder, without the written consent of each Lender Party affected thereby;

(iii)postpone the maturity of any    Loan, premium or any date for the payment of any interest or fee payable hereunder,    or reduce the amount of, waive or excuse any such payment, or postpone the    scheduled date of expiration of any Commitment, without the written consent    of each Lender Party affected thereby; 

(iv)change Section 2.11(b) or 2.11(c)    in a manner that would alter the pro rata sharing of payments required thereby,    without the written consent of each Lender;

(v)change any provision of this    Section or the percentage set forth in the definition of "Required Lenders"    or any other provision of any Loan Document specifying the number or percentage    of Lenders required to take any action thereunder, without the written consent    of each Lender; or

(vi)release any Guarantor from its    Loan Guarantee (except as expressly provided in Section 8.03), or limit its    liability in respect of its Loan Guarantee, without the written consent of    each Lender; *provided further* that no such agreement shall amend, modify    or otherwise affect the rights or duties of the Administrative Agent without    its prior written consent.

   

(c)Notwithstanding the foregoing,    if the Required Lenders enter into or consent to any waiver, amendment or    modification pursuant to subsection (b) of this Section, no consent of any    other Lender will be required if, when such waiver, amendment or modification    becomes effective, (i) the Commitment of each Lender not consenting thereto    terminates and (ii) all amounts owing to it or accrued for its account hereunder    are paid in full; provided that this Section 9.02(c) shall not give    the Borrower any additional right to prepay.

   

Section 9.03.*Expenses;Indemnity; Damage Waiver*. (a) The Borrower shall pay (i) all reasonableand documented out‐of‐pocket expenses incurred by theAdministrative Agent and its Affiliates, including the reasonable fees, chargesand disbursements of counsel for the Administrative Agent, in connection withthe syndication of the credit facilities provided for herein, the preparationand administration of the Loan Documents and any amendments, modifications orwaivers of the provisions thereof (whether or not the transactions contemplatedhereby or thereby shall be consummated) and (ii) all out-of-pocket expensesincurred by any Lender Party, including the fees, charges and disbursements ofany counsel for any Lender Party, in connection with the enforcement orprotection of its rights in connection with the Loan Documents (including itsrights under this Section) or the Loans, including all such out-of-pocketexpenses incurred during any workout, restructuring or negotiations in respectof the Loans.

 

(b)The Borrower shall indemnify    each of the Lender Parties and their respective Related Parties (each such    Person being called an "**Indemnitee**") against, and hold each Indemnitee    harmless from, any and all losses, claims, direct damages, liabilities and    related expenses, including the fees, charges and disbursements of counsel    for any Indemnitee, incurred by or asserted against any Indemnitee arising    out of, in connection with, or as a result of (i) the execution or delivery    of any Loan Document or any other agreement or instrument contemplated hereby,    the performance by the parties to the Loan Documents of their respective obligations    thereunder or the consummation of the Transactions or any other transactions    contemplated hereby, (ii) any Loan or the use of the proceeds therefrom, (iii)    any Environmental Liability related in any way, directly or indirectly, to    the Borrower or any Subsidiary or (iv) any actual or prospective claim, litigation,    investigation or proceeding relating to any of the foregoing, whether based    on contract, tort or any other theory and regardless of whether any Indemnitee    is a party thereto; *provided* that such indemnity shall not be available    to any Indemnitee to the extent that such losses, claims, damages, liabilities    or related expenses have resulted from such Indemnitee's or any of such Indemnitee's    Affiliates' gross negligence or willful misconduct.

   

(c)To the extent that the Borrower    fails to pay any amount required to be paid by it to the Administrative Agent    under subsection (a) or (b) of this Section, each Lender severally agrees    to pay to the Administrative Agent such Lender's pro rata share (determined    as of the time that the applicable unreimbursed expense or indemnity payment    is sought, on the basis of respective outstanding Loans) of such unpaid amount;    *provided* that the unreimbursed expense or indemnified loss, claim,    damage, liability or related expense, as the case may be, was incurred by    or asserted against the Administrative Agent in its capacity as such.

   

(d)To the extent permitted by applicable    law, the Borrower shall not assert, and hereby waives, any claim against any    Indemnitee, on any theory of liability, for special, indirect, consequential    or punitive damages (as opposed to direct or actual damages) arising out of,    in connection with, or as a result of, this Agreement or any agreement or    instrument contemplated hereby, any Loan or the use of the proceeds thereof.

   

(e)All amounts due under this Section    shall be payable within 10 Business Days after written demand therefor.

   

Section 9.04.*Successors andAssigns*. (a) The provisions of this Agreement shall be binding on andinure to the benefit of the parties hereto and their respective successors andassigns permitted hereby, except that the Borrower may not assign or otherwisetransfer any of its rights or obligations hereunder without the prior writtenconsent of each Lender (and any attempted assignment or transfer by theBorrower without such consent shall be null and void). Nothing in thisAgreement, expressed or implied, shall be construed to confer upon any Person(except the parties hereto, their respective successors and assigns permittedhereby and, to the extent expressly provided herein, the Related Parties of theLender Parties) any legal or equitable right, remedy or claim under or byreason of this Agreement.

 

(b)Any Lender may assign to one    or more assignees all or a portion of its rights and obligations under this    Agreement (including all or a portion of any Commitment it has at the time    and any Loans at the time owing to it); *provided* that:

(i)unless each of the Borrower    and the Administrative Agent otherwise consent, the amount of the Commitment    or Loans of the assigning Lender subject to each such assignment shall not    be less than $1,000,000; *provided* that this sub-clause (i) shall not    apply to an assignment to a Lender or a Lender Affiliate or an assignment    of the entire remaining amount of the assigning Lender's Commitment or Loans;

(ii)the parties to each such assignment    shall (a) electronically execute and deliver to the Administrative Agent an    Assignment via an electronic settlement system acceptable to the Administrative    Agent (which initially shall be ClearPar, LLC) or (b) manually execute and    deliver to the Administrative Agent an Assignment, together with a processing    and recordation fee of $3,500 (such fee payable by the assignor or assignee,    as agreed by the parties); *provided* that only one such fee shall be    due in respect of a simultaneous assignment to more than one Lender Affiliate;    and

(iii)the assignee, if it shall not    be a Lender, shall deliver to the Administrative Agent a completed Administrative    Questionnaire and applicable tax forms;

 

Subject to acceptance and recording thereof pursuantto subsection (d) of this Section, from and after the Effective Date specifiedin each Assignment the assignee thereunder shall be a party hereto and, to theextent of the interest assigned by such Assignment, have the rights andobligations of a Lender under this Agreement, and the assigning Lenderthereunder shall, to the extent of the interest assigned by such Assignment, bereleased from its obligations under this Agreement (and, in the case of anAssignment covering all of the assigning Lender's rights and obligations underthis Agreement, such Lender shall cease to be a party hereto but shall continueto be entitled to the benefits of Sections 2.09, 2.10, 5.14 and 9.03). Any assignment or transfer by a Lender of rights or obligations under this Agreementthat does not comply with this subsection shall be treated for purposes of thisAgreement as a sale by such Lender of a participation in such rights andobligations in accordance with subsection (e) of this Section.

 

(c)The Administrative Agent,    acting for this purpose as an agent of the Borrower, shall maintain at one    of its offices in New York City a copy of each Assignment delivered to it    and a register for the recordation of the names and addresses of the    Lenders, their respective Commitments and the principal amounts of the Loans    owing to each Lender pursuant to the terms hereof from time to time (the "**Register**"). The entries    in the Register shall be conclusive, and the parties hereto may treat each    Person whose name is recorded in the Register pursuant to the terms hereof    as a Lender for all purposes of this Agreement, notwithstanding notice to    the contrary. The Register shall be available for inspection by any party    hereto at any reasonable time and from time to time upon reasonable prior    notice.

   

(d)Upon its receipt of a duly completed    Assignment executed by an assigning Lender and an assignee, the assignee's    completed Administrative Questionnaire and applicable tax forms (unless the    assignee shall already be a Lender hereunder), the processing and recordation    fee referred to in subsection (b) of this Section and any written consent    to such assignment required by subsection (b) of this Section, the Administrative    Agent shall accept such Assignment and record the information contained therein    in the Register. No assignment shall be effective for purposes of this Agreement    unless it has been recorded in the Register as provided in this subsection.

   

(e)Any Lender may, without the    consent of the Borrower or any other Lender Party, sell participations to    one or more banks or other entities ("**Participants**") in all or a portion    of such Lender's rights and obligations under this Agreement (including all    or a portion of its Commitments and the Loans owing to it); *provided*    that (i) such Lender's obligations under this Agreement shall remain unchanged,    (ii) such Lender shall remain solely responsible to the other parties hereto    for the performance of such obligations and (iii) the Borrower and the other    Lender Parties shall continue to deal solely and directly with such Lender    in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation    shall provide that such Lender shall retain the sole right to enforce the    Loan Documents and to approve any amendment, modification or waiver of any    provision of the Loan Documents; *provided* that such agreement or instrument    may provide that such Lender will not, without the consent of the Participant,    agree to any amendment, modification or waiver described in the first proviso    to Section 9.02(b) that affects such Participant. Subject to subsection (f)    of this Section, each Participant shall be entitled to the benefits of Sections    Section 2.09, 2.10 and 5.14 to the same extent as if it were a Lender and    had acquired its interest by assignment pursuant to subsection (b) of this    Section.

   

(f)A Participant shall not be entitled    to receive any greater payment under Section 2.09 than the applicable Lender    would have been entitled to receive with respect to the participation sold    to such Participant, unless the sale of the participation to such Participant    is made with the Borrower's prior written consent.

   

(g)Any Lender may at any time pledge    or assign a security interest in all or any portion of its rights under this    Agreement to secure obligations of such Lender, including any pledge or assignment    to secure obligations to a Federal Reserve Bank, and this Section shall not    apply to any such pledge or assignment of a security interest; *provided*    that no such pledge or assignment of a security interest shall release a Lender    from any of its obligations hereunder or substitute any such pledgee or assignee    for such Lender as a party hereto. 

   

(h)If at any time any Lender that    is a Foreign Financial Institution (as defined in Section 5.14) is required    to file with the Ministry of Finance a report setting forth each effective    beneficiary (*beneficiario efectivo*) of payments made to such Lender    of interest on its Loans, such Lender shall contemporaneously deliver a copy    of such report to the Borrower.

   

Section 9.05.*Survival*. All covenants, agreements, representations and warranties made by the CreditParties in the Loan Documents and in certificates or other instrumentsdelivered in connection with or pursuant to the Loan Documents shall beconsidered to have been relied upon by the other parties hereto and shallsurvive the execution and delivery of the Loan Documents and the making of anyLoans, regardless of any investigation made by any such other party or on itsbehalf and notwithstanding that any Lender Party may have had notice orknowledge of any Default or incorrect representation or warranty at the timeany credit is extended hereunder, and shall continue in full force and effectas long as any principal of or accrued interest on any Loan or any fee or otheramount payable hereunder is outstanding and unpaid or any Commitment has notexpired or terminated. The provisions of Sections 2.09, 2.10, 5.14 and 9.03 and Article 7 shall survive and remain in full force and effect regardless of theconsummation of the transactions contemplated hereby, the repayment of theLoans, the expiration or termination of the Commitments or the termination ofthis Agreement or any provision hereof.

 

Section 9.06.*Counterparts;Integration; Effectiveness*. This Agreement may be executed in counterparts(and by different parties hereto on different counterparts), each of whichshall constitute an original, but all of which when taken together shallconstitute a single contract. This Agreement, the other Loan Documents and anyseparate letter agreements with respect to fees payable to the AdministrativeAgent constitute the entire contract among the parties relating to the subjectmatter hereof and supersede any and all previous agreements and understandings,oral or written, relating to the subject matter hereof. Except as provided in Section4.01, this Agreement (i) will become effective when the Administrative Agentshall have signed this Agreement and received counterparts hereof that, whentaken together, bear the signatures of each of the other parties hereto and (ii) thereafter will be binding upon and inure to the benefit of the parties hereto andtheir respective successors and assigns. Delivery of an executed counterpartof a signature page of this Agreement by telecopy will be effective as deliveryof a manually executed counterpart of this Agreement.

 

Section 9.07.*Severability.*If any provision of any Loan Document is invalid, illegal or unenforceablein any jurisdiction then, to the fullest extent permitted by law, (i) such provision shall, as to such jurisdiction, be ineffective to the extent (but only tothe extent) of such invalidity, illegality or unenforceability, (ii) the otherprovisions of the Loan Documents shall remain in full force and effect in suchjurisdiction and (iii) the invalidity, illegality or unenforceability of anysuch provision in any jurisdiction shall not affect the validity, legality orenforceability of such provision in any other jurisdiction.

 

Section 9.08.*Right ofSet-off*. If an Event of Default shall have occurred and be continuing,each Lender and each of its Affiliates is authorized at any time and from time totime, to the fullest extent permitted by law, to set off and apply any and alldeposits (general or special, time or demand, provisional or final) at any timeheld and other obligations at any time owing by such Lender or Affiliate to orfor the credit or the account of the Borrower against any obligations of theBorrower now or hereafter existing hereunder and held by such Lender,irrespective of whether or not such Lender shall have made any demand hereunderand although such obligations may be unmatured. The rights of each Lenderunder this Section are in addition to other rights and remedies (includingother rights of setoff) that such Lender may have. Each Lender agrees promptlyto notify the Borrower and the Administrative Agent after any such set-off andapplication made by such Lender, *provided* that the failure to give suchnotice shall not affect the validity of such set-off and application.

 

Section 9.09.*Governing Law;Jurisdiction; Consent to Service of Process*. (a) This Agreement shall beconstrued in accordance with and governed by the law of the State of New York.

 

(b)Each of the parties hereto    hereby irrevocably and unconditionally submits, for itself, to the exclusive    jurisdiction of the Supreme Court of the State of New York sitting in New    York County and of the United States District Court of the Southern District    of New York, and any relevant appellate court (each, a "**New York Court**"), in any    action or proceeding arising out of or relating to any Loan Document, or for    recognition or enforcement of any judgment, and each party hereto irrevocably    and unconditionally agrees that all claims in respect of any such action or    proceeding may be heard and determined in any such New York Court. Each party    hereto (i) expressly and irrevocably waives its rights to any other jurisdiction    to which it may be entitled to by reason of its present or future domiciles    or for any other reason, and (ii) agrees that a final judgment in any such    action or proceeding shall be conclusive and may be enforced in other jurisdictions    by suit on the judgment or in any other manner provided by law.

   

(c)Each Credit Party irrevocably    and unconditionally waives, to the fullest extent it may legally and effectively    do so, any objection that it may now or hereafter have to the laying of venue    of any suit, action or proceeding arising out of or relating to any Loan Document    in any court referred to in subsection (b) of this Section and any right to    which it may be entitled on account of place of residence or domicile. Each    party hereto irrevocably waives, to the fullest extent permitted by law, the    defense of an inconvenient forum to the maintenance of any such suit, action    or proceeding in any such court.

   

(d)Each Credit Party hereby    irrevocably designates, appoints, authorizes and empowers as its agent for    service of process, CT Corporation System, at its offices currently located    at 111 Eighth Avenue, 13th Floor, New York, NY 10011 (the "**Process Agent**"), to receive    and forward on its behalf service of any and all process, notices or other    documents that may be served in any suit, action or proceeding relating hereto    in any New York Court (as defined in subsection (b) of this Section). Each    Credit Party consents to process being served in any suit, action or proceeding    of the nature referred to in this Section by serving a copy thereof upon the    Process Agent. Without prejudice to the foregoing, the Lenders agree that    to the extent lawful and possible, written notice of said service upon the    Process Agent shall also be mailed by registered or certified airmail, postage    prepaid, return receipt requested, to such Credit Party at the address provided    pursuant to Section 9.01. If said service upon the Process Agent shall not    be possible or shall otherwise be impractical after reasonable efforts to    effect the same, the Borrower consents to process being served in any suit,    action or proceeding of the nature referred to in the Section by the mailing    of a copy thereof by registered or certified airmail, postage prepaid, return    receipt requested, to the address of such Credit Party provided pursuant to    Section 9.01, which service shall be effective 14 days after deposit in the    United States Postal Service. Each Credit Party agrees that such service    (1) shall be deemed in every respect effective service of process upon it    in any such suit, action or proceeding and (2) shall, to the fullest extent    permitted by law, be taken and held to be valid personal service upon and    personal delivery to it. Without limitation of the foregoing, each party    hereto irrevocably consents to service of process in the manner provided for    notices in Section 9.01. Nothing in any Loan Document will affect the right    of any party hereto to serve process in any other manner permitted by law.

   

(e)To the extent that any Credit    Party has or hereafter may be entitled to claim or may acquire, for itself    or any of its assets, any immunity from suit, jurisdiction of any court or    from any legal process (whether through service or notice, attachment prior    to judgment, attachment in aid of execution, or otherwise) with respect to    itself or its property, such Credit Party hereby irrevocably waives such immunity    in respect of its obligations under the Loan Documents to the extent permitted    by applicable law and, without limiting the generality of the foregoing, agrees    that the waivers set forth in this Section shall be effective to the fullest    extent now or hereafter permitted under the Foreign Sovereign Immunities Act    of 1976 of the United States and are intended to be irrevocable for purposes    of such Act.

   

Section 9.10.*Waiver of JuryTrial*. EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BYAPPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGALPROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO ANY LOANDOCUMENT OR ANY TRANSACTION CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT,TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NOREPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLYOR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEKTO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHERPARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHERTHINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 9.11.*Headings*. Article and Section headings and the Table of Contents herein are forconvenience of reference only, are not part of this Agreement and shall notaffect the construction of, or be taken into consideration in interpreting,this Agreement.

 

Section 9.12.*Confidentiality*. Each Lender Party agrees to maintain the confidentiality of the Information (asdefined below), *provided* that Information may be disclosed (a) to itsand its Affiliates' directors, officers, employees and agents, includingaccountants, legal counsel and other advisors (it being understood that thePersons to whom such disclosure is made will be informed of the confidentialnature of such Information and instructed to keep such Informationconfidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by applicable laws or regulations or by any subpoena orsimilar legal process, (d) to any other party to this Agreement, (e) inconnection with the exercise of any remedy hereunder or any suit, action orproceeding relating to any Loan Document or the enforcement of any right thereunder, (f) subject to an agreement containing provisions substantially thesame as those of this Section, to (i) any actual or prospective assignee of orParticipant in any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivativetransaction relating to the Borrower and its obligations, (g) with the consentof the Borrower or (h) to the extent such Information either (i) becomespublicly available other than as a result of a breach of this Section or (ii) becomes available to any Lender Party on a nonconfidential basis from a source otherthan the Borrower,*provided, further*, that the Borrower and each LenderParty hereby agrees that the Borrower and each Lender Party (and each of theirrespective employees, representatives, or agents) are permitted to disclose toany and all persons, without limitation of any kind, the structure and taxaspects of the transactions contemplated herein, and all materials of any kind(including opinions or other tax analyses) that relate to such structure and taxaspects. In this regard, the parties acknowledge and agree that any disclosureof the structure or tax aspects of the transactions contemplated by thisAgreement is not limited in any way by an express or implied understanding oragreement, oral or written (whether or not such understanding or agreement islegally binding)*.*For the purposes of this Section, "**Information**"means all information received from the Borrower relating to the Borrower orits business, other than any such information that is available to any LenderParty on a nonconfidential basis before disclosure by the Borrower; *provided*that, in the case of information received from the Borrower after the datehereof, such information is clearly identified at the time of delivery asconfidential. Any Person required to maintain the confidentiality ofInformation as provided in this Section shall be considered to have compliedwith its obligation to do so if such Person has exercised the same degree ofcare to maintain the confidentiality of such Information as such Person wouldaccord to its own confidential information.

 

Section 9.13*. Interest Rate Limitation.*Notwithstanding anything herein to the contrary, if at any time the interestrate applicable to any Loan, together with all fees, charges and other amountsthat are treated as interest on such Loan under applicable law (collectively the"**Charges**"), shall exceed the maximum lawful rate (the "**Maximum Rate**") that may be contracted for, charged or otherwisereceived by the Lender holding such Loan in accordance with applicable law, therate of interest payable in respect of such Loan hereunder, together with allCharges payable in respect thereof, shall be limited to the Maximum Rate and,to the extent lawful, the interest and Charges that would have been payable inrespect of such Loan but were not payable as a result of the operation of thisSection shall be cumulated and the interest and Charges payable to such Lenderin respect of other Loans or periods shall be increased (but not above theMaximum Rate therefor) until such Lender shall have received such cumulatedamount, together with interest thereon at the Federal Funds Effective Rate tothe date of payment.

IN WITNESS WHEREOF, the parties hereto have caused thisAgreement to be duly executed by their respective authorized officers as of theday and year first above written.

 
| VITRO ENVASES NORTEAMERICA, S.A. DE  C.V. |
|-------------------------------------------|
| By:                                       |   |
|                                      | Name: |   |
|                                      | Title: |   |
| By:                                       |   |
|                                      | Name: |   |
|                                      | Title: |   |

 
| INDUSTRIA DEL  ALCALI, S.A. DE C.V., as  a Guarantor |
|------------------------------------------------------|
| By:                                                  |   |
|                                                 | Name: |   |
|                                                 | Title: |   |
| By:                                                  |   |
|                                                 | Name: |   |
|                                                 | Title: |   |

 
| COMPANIA VIDRIERA, S.A. DE C.V.,   as a Guarantor |
|---------------------------------------------------|
| By:                                               |   |
|                                              | Name: |   |
|                                              | Title: |   |
| By:                                               |   |
|                                              | Name: |   |
|                                              | Title: |   |

 

  
| FABRICACION DE MAQUINAS, S.A. DE C.V., as a Guarantor |
|-------------------------------------------------------|
| By:                                                   |   |
|                                                  | Name: |   |
|                                                  | Title: |   |
| By:                                                   |   |
|                                                  | Name: |   |
|                                                  | Title: |   |

 
| PROCESADORA          DE MATERIAS PRIMAS INDUSTRIALIZABLES, S.A. DE C.V., as a Guarantor |
|-----------------------------------------------------------------------------------------|
| By:                                                                                     |   |
|                                                                                    | Name: |   |
|                                                                                    | Title: |   |
| By:                                                                                     |   |
|                                                                                    | Name: |   |
|                                                                                    | Title: |   |

 
| VIDRIERA          MONTERREY, S.A. DE C.V., as a Guarantor |
|-----------------------------------------------------------|
| By:                                                       |   |
|                                                      | Name: |   |
|                                                      | Title: |   |
| By:                                                       |   |
|                                                      | Name: |   |
|                                                      | Title: |   |

 

 
| VIDRIERA          GUADALAJARA, S.A. DE C.V., as a Guarantor |
|-------------------------------------------------------------|
| By:                                                         |   |
|                                                        | Name: |   |
|                                                        | Title: |   |
| By:                                                         |   |
|                                                        | Name: |   |
|                                                        | Title: |   |

 
| VIDRIERA          QUERETARO, S.A. DE C.V., as a Guarantor |
|-----------------------------------------------------------|
| By:                                                       |   |
|                                                      | Name: |   |
|                                                      | Title: |   |
| By:                                                       |   |
|                                                      | Name: |   |
|                                                      | Title: |   |

 
| VIDRIERA          TOLUCA, S.A. DE C.V., as Guarantor |
|------------------------------------------------------|
| By:                                                  |   |
|                                                 | Name: |   |
|                                                 | Title: |   |
| By:                                                  |   |
|                                                 | Name: |   |
|                                                 | Title: |   |

 

 
| VIDRIERA          LOS REYES, S.A. DE C.V., as a Guarantor |
|-----------------------------------------------------------|
| By:                                                       |   |
|                                                      | Name: |   |
|                                                      | Title: |   |
| By:                                                       |   |
|                                                      | Name: |   |
|                                                      | Title: |   |

 
| VITRO          PACKAGING, INC., as a Guarantor |
|------------------------------------------------|
| By:                                            |   |
|                                           | Name: |   |
|                                           | Title: |   |
| By:                                            |   |
|                                           | Name: |   |
|                                           | Title: |   |

 

 
| CREDIT SUISSE, acting through its  Cayman Islands Branch, as a Lender and as Administrative Agent |
|---------------------------------------------------------------------------------------------------|
| By:                                                                                               |   |
|                                                                                              | Name: |   |
|                                                                                              | Title: |   |
|                                                                                              |
| By:                                                                                               |   |
|                                                                                              | Name: |   |
|                                                                                              | Title: |   |

 

 
| American          General Life Insurance Company |
|--------------------------------------------------|
| By:                                              |   |
|                                             | Name: |   |
|                                             | Title: |   |

 

 
| [Bissini          Playfield] |
|------------------------------|
| By:                          |   |
|                         | Name: |   |
|                         | Title: |   |
| BPW          Emerging markets opportunity portfolio lp |
|--------------------------------------------------------|
| By:                                                    |   |
|                                                   | Name: |   |
|                                                   | Title: |   |

  

 
| Cargill          Financial Services International, Inc. |
|---------------------------------------------------------|
| By:                                                     |   |
|                                                    | Name: |   |
|                                                    | Title: |   |

  

 
| FIMEX          International Ltd. |
|-----------------------------------|
| By:                               |   |
|                              | Name: |   |
|                              | Title: |   |

 

 
| Spinnaker          Global Strategic Fund Ltd. |
|-----------------------------------------------|
| By:                                           |   |
|                                          | Name: |   |
|                                          | Title: |   |

  

 
| Spinnaker Global Emerging Markets Fund Ltd. |
|---------------------------------------------|
| By:                                         |   |
|                                        | Name: |   |
|                                        | Title: |   |

  

 
| Spinnaker          Global Opportunity Fund Ltd. |
|-------------------------------------------------|
| By:                                             |   |
|                                            | Name: |   |
|                                            | Title: |   |