Document:

Exhibit 4(a)(7)

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Execution Version

 

LOAN AGREEMENT

 

dated

 

June 10, 2013

 

executed by

 

GRUMA, S.A.B. de C.V.
 as Borrower,

 

BANCO INBURSA, S.A.,
 INSTITUCIÓN DE BANCA MÚLTIPLE,
 GRUPO FINANCIERO INBURSA,
 como Lead Arranging Agent and Administrative Agent,

 

The Financial Entities
 listed in Appendix 1 of this Agreement,
 as Creditors

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

	
RECITALS
    	
1
    
	
CLAUSES
    	
7
    
	
FIRST.   Definitions
    	
7
    
	
SECOND.   Loan Facility
    	
19
    
	
THIRD.   Procedure for Borrowing
    	
20
    
	
FOURTH.   Commission for Arranging
    	
21
    
	
FIFTH.   Interest
    	
21
    
	
SIXTH.   Late Payment
    	
21
    
	
SEVENTH.   Loan Amortization
    	
22
    
	
EIGHT.   Early Payments
    	
22
    
	
NINTH.   Place and Form of Payment
    	
23
    
	
TENTH.   Affirmative Covenants
    	
24
    
	
ELEVENTH.   Negative Covenants
    	
28
    
	
TWELFTH.   Pending Conditions
    	
33
    
	
THIRTEEN   Events of Default
    	
36
    
	
FOURTEEN   Illegality; Increase in Costs
    	
39
    
	
FIFTEEN   Assignment and Participations
    	
41
    
	
SIXTEEN.   Set-off
    	
44
    
	
SEVENTEEN.   Credit Information
    	
44
    
	
EIGHTEEN.   Administrative Agent; Majorities
    	
44
    
	
NINETEEN.   Enforcement Title
    	
49
    
	
TWENTY.   Notices
    	
49
    
	
TWENTY   ONE. Applicable Law
    	
50
    
	
TWENTY   TWO. Jurisdiction
    	
50
    
	
TWENTY   THREE. Costs and Expenses
    	
51
    
	
TWENTY   FOUR. Indemnification
    	
51
    
	
TWENTY   FIVE. Amendments and Waivers
    	
51
    
	
TWENTY   SIX. Confidentiality
    	
54
    
	
TWENTY   SEVEN. Counterparts
    	
54
    
	
TWENTY   EIGHT. Headings
    	
54
    
	
TWENTY   NINE. Exhibits
    	
54
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

List Of Exhibits And Appendixes

 

Exhibit “1”                              Creditors

Exhibit “2”                              Commitments

Exhibit “3”                              Accounts of the Borrower

Exhibit “4”                              Hedging Policy

Exhibit “5”                              Note Format

Exhibit “6”                              Compliance Certificate Format

Exhibit “7”                              Secretary’s Certificate Format

Exhibit “8”                              Legal Opinion of the Borrower Opinion

Exhibit “9”                              Responsible Officer Certificate Format

Exhibit “10”                       Assignment and Acceptance Format

Exhibit “11”                       Letter of Authorization of Credit Information

 

Appendix “A”                List of Litigation

Appendix “B”                Environmental Issues List

Appendix “C”                Borrower’s Subsidiaries List

Appendix “D”                Contracts that Limit the Distribution of Dividends List

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

LOAN AGREEMENT (HEREINAFTER THE ‘‘AGREEMENT’’) EXECUTED BY GRUMA, S.A.B. DE C.V. AS BORROWER (THE ‘‘BORROWER’’), BANCO INBURSA, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE, GRUPO FINANCIERO INBURSA, AS ARRANGER LEAD AGENT AND ADMINISTRATIVE AGENT (THE ‘‘AGENT’’) AND THE FINANCIAL ENTITIES LISTED IN APPENDIX ‘‘1’’ OF THIS AGREEMENT AND THOSE BANKS AND INSTITUTIONS THAT IN THE FUTURE ACQUIRE THE CHARACTER OF CREDITOR IN TERMS OF THE PRESENT AGREEMENT (JOINTLY, THE ‘‘CREDITORS’’ AND, EACH ONE AS, A ‘‘CREDITOR’’) AND GOLDMAN SACHS &CO. AND BANCO SANTANDER (MÉXICO), S.A., INSITUCIÓN DE BANCA MÚLTIPLE, GRUPO FINANCIERO SANTANDER MÉXICO, AS ARRANGER AGENTS (THE ‘‘ARRANGER AGENTS’’), IN ACCORDANCE WITH THE FOLLOWING RECITALS AND CLAUSES:

 

RECITALS

 

1.              The Borrower states to the Administrative Agent and to each Creditor in the Maturity Date and on the Borrowing Date, the following:

 

a.              Corporate Existence and Power: That the Borrower and each of its Subsidiaries:

 

(i)            (A) in the case of the Borrower, it is a sociedad anónima bursátil de capital variable, organized under laws of the United Mexican States (‘‘Mexico’’), (B) with respect the Subsidiaries organized in accordance with Mexican laws, they are companies duly incorporated and existing under the laws of Mexico, and (C) with respect to the Subsidiaries that are not incorporated under Mexican laws, they are entities duly incorporated and existing in accordance with the laws of the jurisdiction that corresponds;

(ii)           They have all the corporate authority and powers and have all governmental licenses, authorizations, consents and approvals needed to: (A) carry out their commercial operations and to own their Assets, unless the lack of licenses, authorizations, consents and approvals would not be reasonably expected to have a Material Adverse Effect and (B) only with respect of the Creditor, execute, subscribe and complies with all their obligations under this Agreement and the Notes; and

(iii)          Comply with all the Legal Requirements, except in the case that the lack of compliance with these could be reasonably expected to cause a Material Adverse Effect.

 

b.              Corporate Authorization; Compliance. The Borrower has all the corporate authorizations needed for the execution and compliance with their obligations according to this Agreement and each one of the Loan Documents and the execution and compliance of the same do not:

 

(i)            breach its social current bylaws.

(ii)           are in conflict or result in a violation or contravention or creation of any Lien or give rise to the acceleration of any right or payment requirement, repurchase or redemption of any obligation nor constitute a default with respect of: (A) any document where any Contractual Obligation that the Borrower is a part to is stated

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

or (B) any order, injunction, official letter or decree issued by any Governmental Authority and to which the Borrower or its Assets are subjected to; or

(iii)          breach or will breach any Legal Requirement.

 

c.               Additional Authorizations. It does not need nor require (including approval for exchange control), consent, exemption, authorization, registry or other procedure, notification or presentation from or before any Governmental Authority or third part for the execution and compliance by the Borrower with the present Agreement or any other Loan Documents or for their enforcement, different from the ones that have been obtained and are current to this date.

 

d.              Compulsory. This Agreement constitutes, and the other Loan Documents to be executed will constitute, a legal and valid obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except to the extent that said enforceability is limited by applicable concurso mercantil, bankruptcy or insolvency laws or by similar laws that affect creditors’ rights in general or by law principles related to enforceability.

 

e.               Litigation. Except for what is stated in Appendix ‘A’, in the date of the present Agreement and only in respect of letter (B) immediately below, as revealed by the Borrower in: (i) the financial statements delivered in accordance with Clause Tenth, letter (a); or (ii)  the Borrower’s most recent annual report, whether is it the Form 20-F filed before the Securities and Exchange Commission or the annual report filed before the Mexican Securities and Exchange Commission (Bolsa Mexicana de Valores, S.A.B. de C.V.), there are no pending procedures, suits, trials, claims or disputes, or to the extent of its knowledge, there are no threats thereof nor there are being contemplated in judicial tribunals, of equity or arbitration or before any Governmental Organization, by or against the Borrower nor any of its Material Subsidiaries, that (A) pretend to affect the legality, validity or enforceability of this Agreement or any other Loan Document, or any operation contemplated hereof or thereof: or (B) if its result were to be contrary to the Borrower’s or its Material Subsidiaries’ interests, it could not reasonably be expected to have a Material Adverse Effect.

 

f.                Financial Information; Material Adverse Effect; Default. (i) The audited consolidated financial statements for the Tax Year ending on December 31, 2012 (of which copies have been delivered to the Administrative Agents and each Creditor) are complete and correct in all relevant aspects, and have been elaborated in accordance with the IFRS and show in the appropriate way, in accordance with the IFRS, the financial situation of the Borrower and its Consolidated Subsidiaries to the date indicated and their results of operations for the Tax Year concluded on December 31, 2012.

 

(ii) The non-audited consolidated financial statements of the Borrower for the Tax Trimester concluded on March 31, 2013 (of which copies have been delivered to the Administrative Agent and each Creditor) are complete and correct in all relevant aspects, and have been

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

elaborated in accordance with the IFRS and show in the appropriate way, in accordance with the IFRS, the financial situation of the Borrower and its Consolidated Subsidiaries to the date indicated and their results of operations for the period covered by them, subject to the absence of notes on the financial statements and resulting adjustments of the annual audit.

 

(iii) From the date of the last audited annual financial statements, no events or circumstances have arisen that, individually or jointly, have had or could reasonably be expected to have a Material Adverse Effect.

 

(iv) On the Maturity Date and Borrowing Date, the Borrower nor any of its Material Subsidiaries are in default under or in respect to any Contractual Obligation in respect of which, jointly or individually, could reasonably be expected to have a Material Adverse Effect or that gave rise to, if said default had occurred after the Maturity Date or Borrowing Date, to an Event of Default under Clause Thirteen, letter (a)(v) of this Agreement.

 

g.               Pari Passu. The Borrower’s payment obligations under the present Agreement and other Loan Documents (including, without limitation, the Notes) constitute unconditional and unsubordinated obligations of the Borrower and have and will have at any moment when at least the same preference of payment (pari passu) than its other unguaranteed debt, present or future (with the exception of those payment obligations that have preference in accordance with the applicable legislation).

 

h.              Taxes. The Borrower and its Material Subsidiaries have presented in time and form all returns and reports required under Mexican laws and have paid in a timely fashion all taxes, contributions, fines and any other governmental charges that have been assessed for them or with which they or their assets have been lodged with, including fines and related charges, debt and payable, except for (i) those that were challenged in good faith through the right proceedings and to which the necessary reserves were made in accordance with the IFRS, in that case; and (ii) those that if not paid, individually or jointly, would not be reasonably expected to have a Material Adverse Effect.

 

i.                  Environmental Issues. (i) The Borrower and its Subsidiaries’ ordinary operations comply, in all relevant aspects, with the applicable Environmental Laws, except for the matters listed in Appendix ‘B’ and except for those that if not complied with, individually or jointly, couldn’t be reasonably expected to have a Material Adverse Effect.

 

(ii)  The Borrower and its Subsidiaries have obtained all environmental permits, of health and security needed or required for their operations, all these permits are currently in force and the Borrower and its Subsidiaries comply with the relevant terms and conditions of such permits, except for those listed in Appendix ‘B’ and except for those that if not complied with, individually or jointly, couldn’t be reasonably expected to have a Material Adverse Effect.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(iii) As far as its knowledge goes, after a reasonable investigation, no Asset property owned by the Borrower or any of its Subsidiaries, or operated by them, currently or in the past (including ground, subterraneous water, superficial water, constructions or other structures) has been contaminated with any substance that could reasonably be expected to require investigation or remedying under any Environmental Law nor it has incurred in any liability for the emission of substances in third parties’ property except for those that individually or jointly couldn’t be reasonably expected to have a Material Adverse Effect; and

 

(iv) The Borrower nor any Subsidiary has received any notice, requirement, claim or application for information indicating that they could have contravened or be subject to liability under any Environmental Law or subject to any judgment, decree, injunction or any other type of agreement with any Governmental Authority in relation with any Environmental Law except for what is listed in Appendix B or except for those that individually or jointly could not be reasonably expected to have a Material Adverse Effect.

 

(j) Compliance with Social Security Legislation, etc. The Borrower and its Material Subsidiaries comply with all Legal Requirements regarding social security, except to the extent that the noncompliance with these could not be reasonably expected to have a Material Adverse Effect.

 

(k) Assets; Patents; Licenses; Etc. (i) The Borrower and its Subsidiaries have the deed or a valid leasing agreement in respect of all Assets that are reasonably necessary or utilized in the ordinary course of business or that is relevant to said businesses, except to the extent that the lack of said deed or valid leasing agreement, individually or jointly, could not be reasonably expected to have a Material Adverse Effect.

 

(ii) The Borrower and its Subsidiaries are owners or have licenses or have right to utilize all registered brands, registered names, copyrights, patents, contractual franchises, licenses, authorizations, other intellectual property or other rights that are reasonably necessary for the course of business, without conflict with other Person’s rights, except to the extent that the lack of said licenses or rights, individually or jointly, could not be reasonably expected to have a Material Relevant Effect.

 

(iii) The Borrower and its Subsidiaries have insurance policies with solid, responsible and renowned insurance companies, in the amounts and hedges that are usually gotten by renowned companies involved in similar businesses and that operate and/or possess similar assets to those that are owned and/or are operated by the Borrower or by any Subsidiary, as the case may be, in the same general areas in which the Borrower and/or the Subsidiary possess and/or operates its assets, in accordance with common industrial practices, except to the extent that the lack of said insurance policies, individually or jointly, could not be reasonably expected to have a Material Adverse Effect.

 

(l) Subsidiaries. (i) A complete and correct list of the Borrower’s Material Subsidiaries to the Maturity Date, showing their name, jurisdiction of their incorporation and percentage of shares, that are owned by the Borrower and each Material Subsidiary is found on Appendix ‘C’ of this Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(ii) A list of all contracts and agreements that in their terms, expressly prohibit or limit the payment of dividends or other distributions to the Borrower by the Material Subsidiaries or the granting of Loans to the Borrower by a Material Subsidiary is found in Appendix ‘‘D’’, save for those agreements and contracts that were executed after the Closing Date and that were permitted by the Eleventh Clause, letter (e).

 

(m) Acts of Commerce. The Borrower’s obligations under the present Agreement and the Notes are of commercial nature and are subject to the civil and commercial laws, and the subscription and compliance of the present Agreement constitute private acts of commerce, not public or of the government and the Borrower is subject to litigation with respect to its obligations pursuant to the present Agreement.

 

(n) Legal Form. The present Agreement, and the Notes, once signed and delivered, will have sufficient legal form to demand the Borrower’s compliance in accordance with Mexican laws.

 

(o) Total Disclosure. All written information that is not to be utilized in the future that was delivered by the Borrower to the Administrative Agent or any other Creditor for purposes of or in relation to the present Agreement is, and all said information that is delivered in the future by the Borrower to the Administrative Agent or any other Creditor will be, true and correct in all relevant aspects to the date in which said information is generated as indicated in the document delivered. All written information, to be used in the future, delivered to the Administrative Agent or to the Creditors has been prepared in good faith, based on scenarios considered as reasonable by the Borrower. The Borrower has informed the Administrative Agent and the Creditors, in writing, all the known facts and considered to reasonably be expected to have a Material Adverse Effect.

 

(p) Loan Destination. The Borrower will use the Loan funds (as this term is subsequently defined) only for the refinancing of the Refinanced Debt (as this term is subsequently defined); in the understanding that, the Creditors will not be liable for the destination to which the funds are applied.

 

(q) Representation. The Borrower’s attorney-in-fact who appears to the execution of the present Agreement and other Loan Documents, has sufficient authority to bind it in the terms of the Loan Documents (including, without limitation, the Notes), and such authorities have not been revoked or limited, in any form, to the execution date of the present Agreement.

 

(r) Existence of the Administrative Agent. The existence of the Administrative Agent is expressly recognized, as well as its legal capacity to act as Administrative Agent in representation and benefit of the Creditors in the execution of the present Agreement and the capacity and authorities of its attorney-in-fact to sign the present Agreement.

 

II. The Agent states that:

 

(a)         It is a financial institution incorporated in accordance with Mexican laws, authorized under its corporate purpose to execute the present Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(b)         Its attorney(s)-in-fact have enough power to compel it in the terms of this Agreement and Loan Documents, and such powers have not been revoked, limited, in any way, to the execution date of the present Agreement.

 

III. Each Creditor states that:

 

(a)         It is a financial institution incorporated in accordance with Mexican laws, authorized under its corporate purpose to execute the present Agreement.

 

(b)         Its attorney(s)-in-fact have enough power to compel it in the terms of this Agreement and Loan Documents, and such powers have not been revoked, limited, in any way, to the execution date of the present Agreement.

 

(c)          It expressly recognizes the existence of the Administrative Agent and its legal capacity to act as Administrative Agent in representation and benefit of the Creditors in the execution of the present Agreement and the capacity and authorities of its attorney-in —fact to sign the present Agreement.

 

Pursuant to the foregoing, the parties agree to the following:

 

CLAUSES

 

FIRST. Definitions. (a) The following terms that are utilized in capital letters in the present Agreement, have the definitions indicated below (all terms in this First Clause and other provisions that are used in a singular form in this Agreement will have the same meaning when in plural and vice versa):

 

‘‘Affiliate’’ means, as to any Person, any other Person which, directly or indirectly, through one or more intermediaries, is in Control of, is Controlled by, or is under common Control with, such Person.

 

‘‘Agent’’ or ‘‘Administrative Agent’’ has the meaning provided in the heading of this Agreement.

 

‘‘Agent’s Account’’ means account No. 50018760903, CLABE No. 036580500187609033, that the Administrative Agent maintains with Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa or any other account that the Administrative Agent notifies in writing in substitution to said account.

 

‘‘Agreement’’ has the meaning provided in the heading of this Agreement.

 

‘‘Applicable Margin’’ means the rate (expressed in base points (bps)) that will be added to the TIIE Rate on the total amount disposed of during the validity of this Agreement and that is calculated in accordance with the variations in the Leverage Ratio in accordance with the following:

 

	
Leverage
   Ratio
    	
 
    	
< =
   2.0x
    	
 
    	
>2.0x to
   <=2.5x
    	
 
    	
>2.5x to
   <=3.0x
    	
 
    	
>3.0x to
   <=3.5x
    	
 
    	
>3.5x to
   <=4.0x
    	
 
    	
<4.0x to
   <=4.5x
    	
 
    	
>4.5x to
   <=4.75x
    	
 
    
	
Applicable Margin (in pbs)
    	
 
    	
162.5
    	
 
    	
175.0
    	
 
    	
200.0
    	
 
    	
212.5
    	
 
    	
225.0
    	
 
    	
237.5
    	
 
    	
262.5
    	
 
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Arranging Agents’’ means Goldman Sachs & Co. and Banco Santander (Mexico), S.A., Institución de Banca Múltiple, Grupo Financiero Santander Mexico.

 

‘‘Asset’’ means any asset, income or any other tangible or intangible good, including the right of receiving income.

 

‘‘Assignee’’ has the meaning provided in Clause Fifteen, letter (a) of this Agreement.

 

‘‘Assignment and Acceptance’’ has the meaning provided in Clause Fifteen, letter (a) of this Agreement.

 

‘‘Borrower’’ has the meaning provided in the heading of this Agreement.

 

‘‘Borrower’s Account’’ means the bank account that the Borrower maintains with Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa and that is specified in the document enclosed to the present Agreement as Exhibit ‘‘3’’.

 

‘‘Borrowing’’ means the disbursement of the Loan made by Creditors, through the Administrative Agent, in favor of the Borrower.

 

‘‘Borrowing Date’’ has the meaning set forth on Clause Third, letter (a), of this Agreement.

 

‘‘Business Day’’ means, any day in which commercial banks in Mexico City, Distrito Federal, Mexico, carry out their operations and are not authorized to close down. Notwithstanding the foregoing, for purposes of this Agreement, Saturdays, Sundays and December 31st of every year, will not be considered as a Business Day.

 

‘‘Capital Investments’’ means, to any period, without duplicity, any expense of the Borrower and its Subsidiaries made in order to acquire fixed assets or capital assets related to the Borrower’s Core Business that, in accordance with the IFRS, would be classified as capital investments.

 

‘‘Cash Equivalents’’ means, on any date: (i) any direct obligation of (or guaranteed unconditionally by) the United States of America or a State of this country, or any country of the Organization for Economic Cooperation and Development or any other foreign government in the country where the Borrower or any of its Subsidiaries carry out operations or could carry out operations in that moment, (or any agency or political subdivision of the same, as long as said obligation is supported by good faith and credit of ht the United States of America or a State of this country, or any country of the Organization for Economic Cooperation and Development or any other foreign government in the country where the Borrower or any of its Subsidiaries carry out operations or could carry out operations in that moment) and which maturity is not later than a year after; (ii) commercial paper maturing not more than 270 days form the date of issuance, which is issued by any of the following: (A) any corporation rated A-1 or higher by S&P or P-1 or higher by Moody’s, or any Creditor (or its controlling company); or (B) any certificate of deposit, time deposit or bankers acceptance, maturing not more than one year after its date of issuance, which is issued by any bank which has: (1) a credit rating of A2 or higher according to Moody’s or A or higher according to S&S, and (2) a combined capital and surplus greater than US$500,000,000 (five hundred million Dollars 00/100).

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Closing Date’’ means the date, in or after June 10, 2013, in which the Administrative Agent notifies the Borrower that all specified conditions in letter (a) of Clause Twelfth have been complied with or are considered complied with.

 

‘‘Commitment’’ means, with respect to each Creditor, the obligation of such Creditor to grant the Loan for a principal amount that will not exceed the amount set forth opposite its name in Exhibit’’2’’ of this Agreement.

 

“Consolidated EBITDA” means, for any Measurement Period, for the Borrower and its Consolidated Subsidiaries, an amount equal to the sum, without duplication, to the sum of: (i) consolidated operating income; and (ii) the amount of depreciation and amortization expense deducted during such Measurement Period in determining such consolidated operating income, in each case determined in accordance with the IFRS/NIIF.

 

(b) Every accountability term not expressly defined in this Agreement and all the financial information that the Borrower or any other Person has to deliver in accordance with this Agreement, will be interpreted, prepared and, in the case of, will be consolidated in accordance with the NIIF/IFRS.

 

(c) Every reference made to this Agreement to any clause, subsection, paragraph, exhibit or similar, will be construed as a reference to a clause, subsection, paragraph, exhibit or similar of this Agreement, unless it expressly established that said clause, subsection, paragraph, exhibit or similar refers to another document.

 

‘‘Consolidated Equity’’ means, at any moment, all quantities that in accordance with the IFRS must be included in the equity in the Borrower’s and its Subsidiaries’ consolidated balance sheet.

 

‘‘Consolidated Financial Expenses’’ means, to any Measurement Period in respect of the Borrower and its Consolidated Subsidiaries, the sum of: (i) all interests, prime payments, commissions, charges and expenses related to the Borrower and its Consolidated Subsidiaries related to money taken on loan (including capitalized interests) or related to the deferred purchase price of assets, as long as in all cases they are treated as interests in accordance with the IFRS; and (ii) the part of the expenses for Borrower and its Consolidated Subsidiaries’ lease, in respect to said period, under capital or financial leases that is treated as interest in accordance with the IFRS.

 

“Consolidated Subsidiaries” means, with respect to the Borrower, any Subsidiary or other entity which accounts, under the IFRS, are consolidated with the Borrower’s in the consolidated financial statements of the Borrower; and at any date with respect to any Person, any Subsidiary or other Entity which accounts are consolidated with such Person’s in the consolidated financial statements of such Person as of that date.

 

‘‘Contractual Obligation’’ means, in respect to any Person, any deal, contract, agreement, of which said Person is part of, or through which this or its Assets were compromised or obliged.

 

‘‘Control’’ means, the capacity to determine the administration and policies of a Person, directly or indirectly, whether it is through shares with voting rights, by contract or any other form.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Core Business’’ means, in respect of the Borrower and its Subsidiaries, the production and distribution of corn flour, the production and distribution of tortillas and other related products, the production and distribution of wheat flour and any other business related with foods in which the Borrower and its Subsidiaries are involved in periodically, or could be involved in, or auxiliary businesses of these or for the support of the foregoing.

 

‘‘Corporate Capital’’ means, shares, ownership interests, or similar instruments (regardless of its denomination), representative of a company’s social capital, as well as any Person’s participation (different from a company) and any and all optional warrant, rights or options of purchase of the above.

 

‘‘Creditor’’ or ‘‘Creditors’’ has the meaning provided in the heading of this Agreement.

 

‘‘Default’’ means any event, act or situation that through notification or with the pass of time, or both, would constitute (if not cured, dispensed or otherwise remedied) an Event of Default.

 

“Disposition” means the sale, transfer, license or other disposition of properties (including any sale and leaseback transaction) of any Asset by any Person, other than in the ordinary course of business, including any sale, assignment, transfer or any other disposition with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith; provided, however, that any financing involving, or secured by, the future sale of accounts receivable (or any similar financing transaction) will not be considered to be a sale or disposition in the ordinary course of business.

 

‘‘Early Payment’’ has the meaning set forth on Clause Eight, letter (a), of this Agreement.

 

‘‘Eligible Assignee’’ means (i) a Creditor; (ii) an Affiliate and/or Subsidiary of a Creditor in the extent that such Person, from the subscription of an Assignment and Acceptance has the right to receive additional quantities under the terms of Clause Ninth letter (b)(i), in an amount that does not exceed the quantities that the assignor would have had the right to receive if the assignee has been a Foreign Financial Institution or a Mexican Financial Institution; (iii) a Foreign Financial Institution; (iv) an Export Credit Agency; (v) a Mexican Financial Institution; or (vi) any other Person different from the natural Person, approved by the Creditor to its absolute discretion; provided that, regardless of the above, the ‘‘Eligible Assignee’’ will not include the Borrower nor any of its Subsidiaries or Affiliates of such.

 

‘‘Environmental Laws’’ means any law, regulation, order, statute, norm, code, injunction, judgment, decree or agreement applicable to the Borrower or any of its subsidiaries issued, promulgated or entered into by or with any Governmental Authority related to the contamination or environmental protection, environmental treatment, storage, disposal, liberation or threat of liberating or handling of hazardous materials, including, but not limited to the Ley General de Equilibrio Ecológico y Protección al Ambiente, the Ley General para la Gestión Integral de Residuos Peligrosos, the technical norms issued under the same, as well as any other State laws, rules and regulations related to environmental matters and any specific agreement of the Borrower or any of its Subsidiaries entered into with the corresponding authorities which include obligations related to environmental matters.

 

‘‘Event of Default’’ has the meaning set forth on Clause Thirteen of this Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Export Credit Agency’’ means an official non-Mexican Financial Institution for the promotion of exports duly registered in Book I (Libro I) Section 5 (Sección 5) of the Foreign Banks, Financial Entities, Pension and Retirement Funds and Investment Funds Registry (Registro de Bancos, Entidades de Financiamiento, Fondos de Pensiones y Jubilaciones y Fondos de Inversión del Extranjero) of the Ministry of Finance (Secretaría de Hacienda y Crédito Público) for purposes of Rule II.3.9.1 of the Resolución Miscelanea Fiscal for the year 2013 and Article 196-II of the Mexican Income Tax Law (or any successor provision).

 

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

 

‘‘Foreign Financial Institution’’ means a Borrower or a non-Mexican Financial Institution: (i) registered in Book I (Libro I), Section 1 (Sección 1) or Section 2 (Sección 2) of the Foreign Banks, Financial Entities, Pension and Retirement Funds and Investment Funds Registry (Registro de Bancos, Entidades de Financiamiento, Fondos de Pensiones y Jubilaciones y Fondos de Inversión del Extranjero) maintained by the Ministry of Finance for purposes of Rule II.3.9.1 of the Resolución Miscelánea Fiscal for the year 2013 and Article 195-I of the Ley del Impuesto Sobre la Renta (or any successor provisions thereof), (ii) which is a resident (or, if such entity is lending through a branch or agency, the principal office of which is a resident) for tax purposes in a jurisdiction with which Mexico has entered into a treaty for the avoidance of double-taxation which is in effect, and (iii) which is the effective beneficiary (beneficiario efectivo) of any interest paid hereunder.

 

‘‘Gimsa’’ means Grupo Industrial Maseca, S.A.B. de C.V.

 

‘‘Governmental Authority’’ means, any of the executive, legislative or judicial branches, regardless of the form they are acting, whether federal, state or municipal, any government agency, body, decentralized agency or equivalent entity or any state , department or other political subdivision of the same, or any governmental organism (including any central bank or tax authority) or any entity (including any court) exercising government functions, executive, legislative, judicial, domestic or foreign.

 

‘‘Guaranty Obligation’’ means, as to any Person: (a) any obligation, contingent or otherwise, of such Person guarantying or having the economic effect of guarantying any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including an aval and any obligation of such Person, direct or indirect, (A) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (B) to purchase or lease property, securities or services for the purpose of assuring the oblige in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (C) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation; or (D) entered into for the purpose of assuring in any other manner the obliges in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obliges against loss in respect thereof (in whole or in part), or (ii) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person; provided that the term “Guaranty Obligation” shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guaranty Obligation shall be deemed to be an amount equal to the stated or determinable amount of the related main obligation, or portion thereof, in respect of which such Guaranty Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guarantying Person in good faith.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

“Hedging Transaction” means (i) any and all derivative transactions, interest rate swap transactions, variable rate swaps, derivative credit transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, swap options, forward purchase transactions, future transactions or any other similar transactions or option or any other transactions involving or settled by reference to one or more rates, currencies, commodities, equity or debt instruments or securities or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement and (ii) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

 

‘‘IFRS’’ means the International Financial Reporting Standards issued by the International Accounting Standards Board (IASB).

 

‘‘Indebtedness’’ or ‘‘Debt’’ means, in respect of any Person, in any date and without duplicity:

 

(i) any obligation of such Person in respect of money taken in loan, and any obligation of such Person documented by bonds, notes, obligations or similar instruments;

 

(ii) any obligation of such Person in respect of a lease or lease with option to purchase that, in accordance with the IFRS (or, in the case of Persons constituted under the laws of any State in the United States of America, the accounting principles generally accepted in the United States or ‘‘US GAAP’’), is considered as a financial or capital lease;

 

(iii) any third party indebtedness guaranteed by a Lien over any asset of said Person, whether such Person accepts said indebtedness or not;

 

(iv) any obligation of said Person to pay the deferred purchase price of fixed assets or services if such deferral extends over a period that exceeds more than 60 (sixty) days;

 

(v) all Guaranteed Obligations in charge of the Borrower regarding third party obligations that are not related with the Borrower’s Core Business to the present date;

 

notwithstanding the above, the following obligations will be expressly excluded from the definition of the term Indebtedness: (i) accounts payable to suppliers, including any obligation in respect of letters of credit that were issued for the payment accounts payable to suppliers; (ii) accrued expenses and payable in the ordinary course of business; (iii) advance payments and deposits received from clients in the ordinary course of business; and (iv) obligations for ad valorem taxes, value-added taxes, or any other tax or governmental charge.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Indemnity Obligation’’ has the meaning set forth on clause Twenty Fourth of this Agreement.

 

‘‘Interest Coverage Ratio’’ means as of the last day of the Tax Trimester, the ratio of: (i) the Consolidated UAFIDA by (ii) the Consolidated Financial Expenses, determined for the relevant Measurement Period.

 

‘‘Interest Payment Date’’ has the meaning set forth Clause Fifth, letter (b), of this Agreement.

 

‘‘Interest Period’’ means each quarterly period based on which the interest accrued by the principal amount will be calculated, in the understanding that, (i) the first Interest Period shall begin on (and include) the Borrowing Date and shall end on (excluding) the last Business Day of the third calendar month following the month on which the Borrowing was made; (ii) each subsequent Interest Period shall being (and include) the last day of the immediately preceding Interest Period and shall end on (excluding) the last Business Day of the corresponding subsequent calendar month; and (iii) no Interest Period shall be extended longer than the Maturity Date.

 

‘‘Interest Rate’’ has the meaning set forth on Clause Fifth, letter (a), of this Agreement.

 

‘‘Investments’’ means, in respect to any Person, any acquisition or investment made by said Person through: (i) the purchase or acquisition of Corporate Capital or other securities belonging to another Person, (ii) a loan, advance payment or contribution of capital to, guaranty or debt of, or the purchase or acquisition of any other debt or share capital in, other Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or acquisition of all or a substantial portion of the business or Assets of any Person or the assets of any Person that constitute a business unit or division. For purposes of this Agreement, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

 

‘‘ Late Interest Rate’’ has the meaning set forth on Clause Sixth of this Agreement.

 

‘‘Legal Requirement’’  means, respect of any Person, any law, treaty, rules, regulation or order, decree or other determination by an arbitrator, court or any Governmental Authority, including any Environmental Law, that for every case it is applicable and binding for such Person or any of its assets or respect of which said Person or its assets are bound.

 

‘‘Leverage Ratio’’ means, the closing of the last Tax Trimester, the ratio of: (i) the Total Bank Debt as of the last day of said Tax Trimester by (ii) the Borrower’s and its Consolidated Subsidiaries’ Consolidated UAFIDA determined for the corresponding Period of Measure.

 

‘‘Lien’’ means, in relation to any Asset, any mortgage, pledge, charge, guaranty, affectation, limited domain or lien of any kind in respect to said Asset.

 

‘‘Loan’’ means, the term loan that the Creditors jointly or each individually in accordance with their Commitment, will make available to the Borrower in accordance with the present Agreement.

 

‘‘Loan Documents’’ means, this Agreement, the Notes, as well as any other document executed and/or given in relation with or in accordance with this Agreement, including, as the case may be, it’s amendments, supplements or additions.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Majority of Creditors’’ means the Creditors that are holders of at least 51% (fifty one percent) of the unpaid balance of the Loan.

 

‘‘Material Adverse Effect’’ means a chance, condition or event in the operations, projects, business, assets, liabilities (actual or contingent), goods, responsibilities or in the condition (financial or any other type) or the results of the Borrower’s operations and its Subsidiaries takes as a whole that affects in a material way: (i) the Borrower’s capacity to comply with its obligations under any Loan Document; (ii) the legality, validity, compulsory or enforceability against the Borrower on any Loan Document; or (iii) the rights and legal resources of the Administrative Agent or the Creditors in accordance with Loan Documents.

 

“Material Subsidiary” means, at any time, any Subsidiary of the Company that meets any of the following conditions:

 

(i)            The Borrower’s and its Subsidiaries’ investments in or advances to such Subsidiary exceed 10% of the total assets of the Borrower and its Consolidated Subsidiaries as of the end of the Borrower’s most recently completed Fiscal Year; or

 

(ii)           The Borrower’s and its Subsidiaries’ proportionate share of the total assets (after intercompany eliminations) of such Subsidiary exceeds 10% (ten percent) of the total assets of the Borrower and its Consolidated Subsidiaries as of the end of the Borrower’s most recently completed Fiscal Year;

 

(iii)          The Borrower’s and its Subsidiaries’ equity in the earnings before income tax and employees statutory profit sharing of such Subsidiary exceeds 10% of such earnings of the Borrower and its Consolidated Subsidiaries as of the end of the Borrower’s most recently completed Fiscal Year, all as calculated by reference to the then latest audited financial statements (or consolidated financial statements, as the case may be) of such Subsidiary and the then latest audited consolidated financial statements of the Borrower and its Subsidiaries;

 

Provided that, notwithstanding the foregoing, the Venezuelan Subsidiaries shall not be considered Material Subsidiaries.

 

‘‘Maturity Date’’ means June 10, 2018.

 

‘‘Measurement Period’’ means any period of four (4) of the Borrower’s consecutive Tax Quarters, ending with the last completed Tax Trimester, taken as an accountable period.

 

‘‘Mexican Financial Institution’’ means a credit institution established and existing under the laws of Mexico and duly authorized to conduct credit operations in Mexico by the Ministry of Finance.

 

‘‘Mexico’’ has the meaning set forth on Declaration I letter (a)(i) of this Agreement.

 

‘‘Moody’s’’ means Moody’s Investors Services, Inc.

 

‘‘Note’’ or ‘‘Notes’’ has the meaning set forth on Clause Third, letter (d), of this Agreement.

 

‘‘Originating Creditor’’ has the meaning provided in Clause Fifteen, letter (e) of this Agreement.

 

‘‘Participant’’ has the meaning set forth on Clause Fifteen, letter (e) of this Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Payment Date’’ has the meaning set forth on Clause on Clause Seventh of this Agreement.

 

“Permitted Hedging Transaction” means any Hedging Transaction that (i) is not for speculative purposes and was not entered into and is not being maintained with the aim of obtaining profits based on changing market values; (ii) is based on or associated with the underlying value of a product, instrument, security, commodity, interest rate, currency, index or measure of risk or value that is used by the Borrower or any of its Subsidiaries in the ordinary course of business; And (iii) is in compliance with the Hedging Policy.

 

‘‘Person’’ means a natural or legal person, company, business trust or any other trust that has been intended to operate

 

‘‘Peso’’, ‘‘$’’ or ‘‘Pesos’’ means the legal currency in Mexico.

 

‘‘Refinanced Debt’’ means (i) the Debt under the note with maturity date of 12 June 2013, in favour of Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa, for a principal amount of USD$100,000,000.00 (one hundred million Dollars 00/100), and (ii) the Debt under the Bridge Loan Agreement dated 13 December, 2012 (as modified or supplemented), in favor of Goldman Sachs Bank USA and Banco Santander (México), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México, for a principal amount of USD$300,000,000.00 (three hundred million Dollars 00/100).

 

‘‘Registry’’ has the meaning set forth on Clause Fifteen, letter (c), of this Agreement.

 

‘‘Responsible Officer’’  means, in respect of any Person, the CEO, CFO, Treasurer or any other officer with a similar or equivalent position.

 

‘‘Restricted Payment’’ means in relation to any Person (i) any dividend or other distribution (whether is cash, securities or other Assets) declared in favor of the holders of shares representative of the Borrower’s Social Capital or any of its Subsidiaries’ Social Capital; and (ii) any payment (whether in cash, securities, or other Assets), including any amortization fund or similar deposit, purchase, redemption, retirement, acquisition, cancellation of representative shares of the Borrower’s or any of its Subsidiaries’ Social Capital or in relation to any option or any other right to acquire any of said representative shares of the Social Capital on said Person.

 

‘‘S&P’’ means Standard & Poor’s.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, joint venture, limited liability company, trust, estate, or other entity of which more than 50% of (a) in case of a corporation, the issued and outstanding shares of the voting Corporate Capital, (b) in case of a limited liability company, partnership, or joint venture, the ownership interests or stake in the stock or profits of such limited liability company, partnership, or joint venture, or (c) in case of a trust or similar figure, the right to participate in the assets of the same, in that moment, directly or indirectly, owned, or controlled by, (i) such Person, (ii) such Person and one or more of its Subsidiaries, or (iii) one or more of the Subsidiaries of such Person.

 

‘‘Taxes’’ has the meaning set forth on Clause Ninth, letter (b)(i) of this Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Tax Year’’ means any period starting on January 1 and ending on December 31 of every calendar year.

 

‘‘TIIE Rate’’ means, for every Interest Period, the Tasa de Interés Interbancaria de Equilibrio within 91 (ninety-one) days, published by the Mexican Central Bank (Banco de Mexico) in the Official Federation Gazette (Diario Oficial de la Federación) on the first day of the corresponding Interest Period; provided that, in case that the first day of the Interest Period is not a Business Day, the TIIE Rate will be the one published on the immediate previous Business Day to the initial date of said Interest Period or on the closest Business Day.

 

In case the Mexican Central Bank (Banco de México) stops publishing the quoting of the TIIE Rate, whether temporary or definitively, in the Interest Rate will be calculated based on the one the Mexican Central Bank (Banco de México) determines as substitute for the TIIE Rate. In the event the Mexican Central Bank (Banco de México) doesn’t publish a rate that substitutes the TIIE Rate, the Creditors and the Borrower will determine, in good faith, and by mutual agreement and in writing, the corresponding substituting rate, provided that:

 

i.                  During the period comprehended between the date on which said quoting stops being published and the date on which the substitute rate is published, the TIIE Rate is published again or the parties agree upon the substitute rate , the principal unpaid amount of the Loan will bear interests at the Interest Rate that was applicable during the last Interest Period;

 

ii.               If the TIIE Rate stops being published for a period longer than 91 (ninety one) natural days without the Mexican Central Bank (Banco de México) publishing a substitute rate and the Creditors and Borrower doesn’t reach an agreement in respect of the substitute rate within said period, the substitute rate will be the market rate indicated by the Creditors that establishes a similar financial cost to the TIIE Rate and that will be notified in writing to the Borrower, plus the Applicable Margin; and

 

iii.            Any substitute rate determined in accordance with subsections (i) and (ii) above will stop being applicable starting on the following Interest Period on the date on which the Mexican Central Bank (Banco de México) publishes the TIIE Rate or rate that will substitute it.

 

‘‘Total Funded Debt’’ means, at any time, on a consolidated basis and without duplication, the outstanding principal balance of all debt with respect to money borrowed by the Borrower and its Consolidated Subsidiaries and by the Borrower ́s guaranty obligations of third party obligations not related with the Borrower’s Core Business.

 

‘‘USD$’’ or ‘‘Dollars’’ mean American dollars, legal currency in the United States of America.

 

‘‘Venezuelan Subsidiaries’’ means (i) Derivados de Maiz Seleccionado, S.A. and Molinos Nacionales, C.A., together with their respective direct and indirect Subsidiaries and (ii) any of Subsidiary of the Borrower that is constituted after the date of this Agreement if said new Subsidiary is constituted under laws of the Republic of Venezuela.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

SECOND. Loan Facility (a) Loan. Subject to the terms and conditions convened in this Agreement, the Creditors agree to make available to the Borrower a total amount that will not exceed $2,300,000,000.00 (two thousand three hundred million Pesos 00/100 M.N.), amount that does not include the interest, fees and costs generated in relation to the Loan. The Loan amounts disposed of in accordance with Clause Third and paid (totally or partially) by or on behalf of the Borrower, cannot be disposed of again by the Borrower.

 

Subject to compliance by the Borrower of the conditions established on Clause Twelfth of this Agreement, each of the Creditors will be bound to give the proportional part of the Loan that corresponds according to its Commitment, up to an amount that will not exceed the amount of its Commitment in accordance with what is established in Exhibit “2” of this Agreement.

 

THIRD. Procedure for Borrowing.

 

(a)         Borrowing Term. Starting on the Closing Date, the Borrower will have 15 (fifteen) days to request the reimbursement of the Loan in one single Borrowing under the present Agreement (the “Borrowing Term”). The Borrowing will be made in any Business Day during the Borrowing Term (the ‘‘Borrowing Date’’).

 

(b)         Borrowing Request. The Borrowing under the Loan will be made through a written request subscribed by the Borrower (the “Borrowing Notice”) and delivered to the Administrative Agent before the 13:00 hours (Mexico City time) at least two (2) Business Days before the Borrowing Date, and during which it is specified, at least, (i) the amount of the Borrowing, which should not exceed the equivalent amount to the sum of Commitments, and (ii) the Borrowing Date, which should be a Business Day.

 

(c)          Borrowing. The Creditors’ obligation to make the Borrowing under the present Agreement is subject to compliance with each and every one of the conditions established on Clause Twelfth of this Agreement; provided that, in case that the Borrowing Date has not occurred on the maturity of the Borrowing Term at the latest, the Creditor’s obligation to make available to the Borrower the Loan will end immediately and starting then no obligation of the Creditors will exist in accordance with this Agreement or the Loan Documents. Each Creditor will make the Borrowing in a proportional way up to the amount corresponding to its Commitment.

 

(d)         Notes. The Borrowing will be made against the delivery by the Borrower to each of the Creditors, of a Note subscribed by the Borrower, as a debtor, substantially in the format contained on Exhibit ‘‘5’’ of this Agreement (a ‘‘Note’’). The parties agree that any discrepancy between what is stated in this Agreement and what is stated in any of the Notes, it will prevail what is stated in this Agreement, provided that, in their case, the Creditors will be able to request from the Borrower the substitution of the Notes that reflect the terms of this Agreement.

 

(e)          Disbursement of Resources. Once the Administrative Agent received the Borrowing Notice, it shall immediately give notice to all Creditors of the receipt of said Borrowing Notice and the amount of said Borrowing that corresponds to each Creditor in proportion to its Commitment. Each Creditor will deposit the amounts that correspond in said Borrowing in accordance to its Commitment in the Account of the Agent before 12:00 hours (Mexico City time) in the Borrowing Date, so the Agent deposits said funds in the Borrowing Date to the Borrower’s Account.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

No Creditor or the Administrative Agent will be responsible for the non-compliance of any other Creditor of granting its Loan in accordance to its Commitment, and no Creditor will have an obligation before the Administrative Agent or any other Creditor for the incompliance of the Creditor failing in the granting of its Loan, in accordance to its Commitment. In the case that any Creditor does not participate in a timely manner in the granting of the Loan that corresponds to it in accordance with its Commitment on the Borrowing Date and said incompliance continues until 12:00 p.m. (Mexico City time) of the Business Day following the Borrowing Date, said failed Creditor will be responsible for any costs, losses and expenses in which the Administrative Agent and the other Creditors incur for the delay or non-disbursement of the Borrowing.

 

FOURTH. Arranging Commission. The Borrower undertakes to pay to the Administrative Agent, an arranging commission equivalent to 0.75% (cero point seventy five percent) on the total amount of the Loan, wholly payable on the Borrowing Date. In its case, the Administrative Agent will have to deliver to each Creditor the percentage of the commission that corresponds to each one of the Creditors in accordance with the amount of their Commitment, according to what is established in Exhibit “2” of this Agreement. Said commission will be paid adding the corresponding value added tax, in its case.

 

FIFTH. Interest. (a) The Borrower will pay to the Creditors, without need of previous requirement, ordinary interest over the principal amount of the Loan during each Interest Period, starting on the Borrowing Date until the Loan’s outstanding balance is paid in full, at an annual interest rate equivalent to the TIIE Rate applicable to each Interest Period, plus the Applicable Margin (the “Interest Rate”).

 

(b) The interest will be payable on the last Business Day of each Interest Period (each one, a “Interest Payment Date”); provided that, the last Interest Payment Date shall occur on the Maturity Date.

 

(c) The ordinary interest accrued in accordance with this Agreement, will be calculated by the days effectively elapsed over the base of a year of 360 (three hundred and sixty) days, including the first of said days but excluding the last.

 

SIXTH. Late Payment. In case of default in the payment of any amount payable according to this Agreement or the Notes (excepting ordinary interest), late interest will accrue on the late an unpaid amount from the date in which said payment should have been made until its full payment, to an annual rate equal to the Interest Rate applicable during the period in which the default occurs and continues, multiplied by 1.5 (one point five) (the “Late Interest Rate”).

 

To determine the late interest, the applicable Late Interest Rate will be divided by three hundred and sixty (360) and the result will apply to the unpaid and late balance, resulting in the late interest of every day that the Borrower obliges to pay at sight.

 

SEVENTH. Loan Amortization. The Borrower will pay the Creditors the principal amount of the Loan in 8 (eight) semi-annual and subsequent amortizations on the Interest Payment date of the corresponding month in accordance with the following amortization calendar (each, a “Principal Payment Date”):

 

	
Principal Payment Date
    	
 
    	
Amortization Amount
    
	
December 10,   2014
    	
 
    	
$115,000,000.00
    
	
June 10,   2015
    	
 
    	
$115,000,000.00
    
	
December 10,   2015
    	
 
    	
$115,000,000.00
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

	
June 10,   2016
    	
 
    	
$172,500,000.00
    
	
December 10,   2016
    	
 
    	
$172,500,000.00
    
	
June 10,   2017
    	
 
    	
$172,500,000.00
    
	
December 10,   2017
    	
 
    	
$172,500,000.00
    
	
Maturity   Date
    	
 
    	
Outstanding   Balance of the Loan
    

 

EIGHT. Early Payments.

 

(a)         The Borrower may pay in advance, wholly or partially, the outstanding balance of the Loan (each, an “Early Payment”), plus any interest that has been accrued to the date of said early payment; provided that, said Early Payment shall always be made in an Interest Payment Date. The Borrower will notify, with an irrevocable character to the Administrative Agent, at least 3 (three) Business Days in advance, its intention to make an Early Payment and the amount of the payment. Every partial Early Payment shall be made for a minimum amount of $50,000,000.00 (fifty million pesos 00/100) and over that amount, in multiples of $10,000,000.00 (ten million pesos 00/100).

 

(b)         In case that an Early Payment is made in an Interest Payment Date, the Borrower will not be obligated to pay any commission or penalty. In case that an Early Payment is made in a date other than an Interest Payment Date, the Borrower will pay jointly with the Early Payment and the interest, the charges for fund breaking to the Creditors, whichever is applicable; provided that, the Creditor will have to deliver to the Creditor a document in which it is reasonably described the calculations to obtain the total amount of said charges, being that determination definite and obligatory for the Borrower.

 

(c)          The Early Payments made under this Clause will be applied according to what is established on Clause Thirteen, letter (c); provided that, in case of sub-section fifth of said letter (c), the amounts received by the Administrative Agent under any Early Payment will be applied, proportionally, to the payment of each amortization of the Loan, in terms of the amortization calendar on Clause Seventh above, and on a pro rata basis between the Creditors in accordance with their Commitments. The amounts paid early will be at the disposal of the Borrower again.

 

(d)         In case the Borrower doesn’t make any Early Payment that had been notified to the Creditors, on the date it was scheduled, the Borrower will pay to the Creditors, as soon as it is requested, any cost or expense which was incurred by any Creditor in relation to say Early Payment, prior proof by such Creditor.

 

NINTH. Place and Form of Payment. (a) The Creditor will make all payments of principal, interest, commissions and any other payable amount in respect of the Agreement, free of taxes, contributions, retentions, deductions, charges or any other tax responsibility payable in accordance to the laws, regulations and other applicable legal provisions in Mexico, with no set off, in immediately available funds, before 12:00 hours (time of Mexico City, Mexico) of the day such payment expires; provided that, in the case that said payment is received by the Administrative Agent after 12:00 hours (time of Mexico City, Mexico), said payment will be considered made on the next immediate Business Day following its reception. Said payments will be made in Pesos, to the Agent’s Account. The Administrative Agent, the same Business Day in which it receives the Borrower’s payment under the terms of this Clause, will distribute to each one of the Creditors the portion that corresponds  (determined by taking into account the Commitments detailed on Exhibit “2”) of each payment made by the Borrower that the Administrative received; provided that, the Administrative Agent will not have the obligation to carry out any of those distributions, until it has effectively received such payment from the Borrower.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(b) (i) When applicable any tax, right, contribution, tribute, withholding, deduction, charge or lien or any other tax liability along with interest, surcharges, sanctions, fines or derived charges from the same (“Taxes”) over the payments of principal, interest, commissions or any other amount payable in respect of the Loan, the Borrower will pay the necessary additional sums to the corresponding tax authority, on behalf of the Creditors, the amount that any of said Taxes, and will pay the Creditors the additional amounts required to guarantee that the Creditors will receive the same amounts they would have received, if those Taxes has not been applicable and will deliver to the corresponding Creditor the original receipts or other satisfactory certificates to the Creditor, of the payment of any tax within the 30 (thirty) days following the date that said Tax or withholding is due and payable, according to the applicable legal provisions. The aforementioned will not be applicable in respect of income tax or similar taxes payable by the Creditors or any Assignee in accordance with this Agreement over their income or total assets in accordance to the laws, regulations and other applicable legal provisions in Mexico or any other jurisdiction of which the Creditors or Assignees are a resident of, is legally or has a permanent establishment.

 

(ii) The corresponding Creditor will immediately notify the Borrower and the Administrative Agent of any requirement, notification, payment request or any other notice that they receive from any authority in respect of said requirement, notification, payment request or notice; provided that, in such case, the Creditor will deliver to the Borrower any document that the Creditor possesses or a copy thereof, that the Borrower requires in respect of any proceeding concerning said requirement, notification, payment request or notice.

 

(iii) The Borrower’s obligations according to this section, will prevail over all other obligations of the Borrower in accordance with this Agreement and the Notes.

 

(c) The payments received by the Administrative Agent shall be applied in the order established by Clause Thirteen, letter (c) of this Agreement, as applicable.

 

(d)  In case that any payment obligation of the Borrower is due on a day that is not a Business Day or a day that does not exist in the calendar month in which such payment should be made, such payment shall be done the previous immediate Business Day.

 

TENTH. Affirmative Covenants. Starting on the Closing Date and while any payable amount in accordance with the Loan Documents remains unpaid, the Borrower undertakes to the following:

 

(a)         Financial Statements and Other Relevant Information:

 

The Borrower will deliver to the Administrative Agent:

 

(i)            As soon as they are available, within the 120 (one hundred and twenty) calendar days following each Tax Year, consolidated financial statements for said Tax Year, audited by independent auditors of renowned international prestige, including an annual balance sheet audited and the related consolidated statements of income, variation statements on equity and changes in the financial position, elaborated in accordance with the NIIF, which must be presented, in accordance with the IFRS, the Borrower’s and its Consolidated Subsidiaries at the closing of each Tax Year and the operations results of the Borrower and its Consolidated Subsidiaries for said Tax Year, audited by auditors of renowned international prestige.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(ii)           As soon as they are available within the 60 (sixty) following days to each of the first three Tax Quarters, unaudited consolidated financial statements for each of the first three Tax Quarters, unaudited consolidated financial statements for each of said Tax Quarters, of the Borrower and each of its Consolidated Subsidiaries, including an unaudited consolidated balance sheet and its corresponding consolidated income statements elaborated in accordance with the NIIF, the financial condition of the Borrower and its Consolidated Subsidiaries at the closing of the corresponding Tax Quarter and the operations results of the Borrower and its Consolidated Subsidiaries for said Tax Quarter and for the part of the Tax Year terminated at that moment, except for the absence of notes to the financial statements and estimations relative to the tax year closing as well as the adjustments resulting from the annual audit.

 

(iii)          Together with the delivery of the financial statements in accordance with sections (i) and (ii) above, the Borrower will deliver to the Administrative Agent a Compliance Certificate, substantially in accordance with Exhibit ‘‘6’’, signed by a Responsible Officer of the Borrower.

 

(iv)          To the extent that sections (i) or (ii) above do not state the contrary, the Borrower will deliver to the Administrative Agent, in a timely manner, after they are available to the public, copies of all financial statements and financial reports registered by the Borrower before any Governmental Organization (if said registry is necessary for such statements or reports to be available to the public) or registered with any Mexican or foreign securities exchange (including the Luxembourg Securities Exchange) and that are available to the public.

 

(v)           The Borrower will deliver to the Administrative Agent, in a timely manner and upon its request, or to any Creditor (through the Administrative Agent), the additional information related to the business, financial or corporate matters of the Borrower and its Subsidiaries as the Administrative Agent or any Credit may require in a timely manner, including the rules and regulations of credit information and money laundering.

 

(vi)          The Administrative Agent will deliver in a timely manner (and within 5 (five) Business Days following its reception at the latest) to each Creditor copies of the documents delivered by the Creditor in accordance with this letter (a).

 

(b)         Notice of Default and Proceedings. The Borrower will deliver to the Administrative Agent, not later than  5 (five) Business Days after the Borrower has knowledge of (and the Administrative Agent delivers to each Creditor):

 

(i)            A Notice or Event of Default, signed by a Responsible Officer, describing such Default or Event of Default and the measures the Borrower plans to take to remedy it.

 

(ii)           A notice of any proceedings, suits, pending proceedings or threat thereof, instituted against the Borrower or any of its Material Subsidiaries before any Governmental Authority, in which the plaintiff has a probability of obtaining a sentence in favor and if resulting unfavorably to the Borrower or any of its Material Subsidiaries, whether in an individual or jointly manner, could possibly be expected to have a Material Adverse Effect; and

 

(iii)          A notice of modification of any consent, license, approval or authorization required for the execution or validity of this Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(c)          Existence Maintenance: Conduct of Business.

 

(i)            Borrower undertakes and will cause its Material Subsidiaries to: (A) maintain its corporate existence and all necessary registries for it; (B) take all reasonable measures to maintain all rights, privileges, titles of property, franchises and others necessary or desired for the normal conduct of business, activities or operations; and (C) maintain its Assets in good conditions and functioning; provided that, this provision does not prohibit the Borrower’s nor its Material Subsidiaries’ allowed transactions in accordance to Clause Eleventh, letter (c), of this Agreement, not does it oblige the Borrower to maintain the rights, privileges, titles of property or franchise or keep the corporate existence of any Subsidiary, if the Borrower determines in good faith that the maintenance or preservation of it is not desirable for the Borrower’s or its Material Subsidiaries’ conduct of business and that the loss thereof could not be reasonably expected to have a Material Adverse Effect.

 

(ii)           The Borrower undertakes to continue and cause its Material Subsidiaries to continue with the same line of business that the Borrower and its Material Subsidiaries currently are on.

 

(d)         Insurance. The Borrower will maintain and will cause its Subsidiaries to maintain insurance policies with solid, responsible and with renowned prestige insurance companies, in the amounts and coverage that are normally contracted by stable companies involved in similar businesses and that operate and/or possess similar assets to those that are property of and/or are operated by the Borrower or by any of its Subsidiaries, as the case may be, in the same general areas in which the Borrower and/or the Subsidiary possess and/or operates its asses;  provided that, the Borrower and its Subsidiaries will not require to maintain said policies if the lack of them could not be reasonably expected to have a Material Adverse Effect.

 

(e)          Maintenance of Governmental Authorizations. The Borrower will maintain all governmental authorizations (including any approval in change of control) , consents, licenses and authorizations that could be necessary or appropriate under any applicable law or regulation, for the conduct of business (unless the lack of maintaining said approvals, consents, licenses or authorizations, could not be reasonably expected to have a Material Adverse Effect) or for the compliance of this Agreement and for its validity and enforceability, in force. The Borrower will present all the necessary applications and will make its best effort to get any additional authorization as soon as it is possible once said authorization is determined or approval is needed for the Borrower to comply with its obligations according to this Agreement.

 

(f)           Funds Purpose. The Borrower will use the funds of the Borrowing for the refinancing of the Refinanced Debt, provided that, the Creditors will not be liable for the purpose to which the funds are applied.

 

(g)          Purpose of Income from Sales in Cash and other Assets Dispositions. The Borrower will apply and will make its Subsidiaries to apply, 100% of its net income in cash received from any sale, transfer, disposition or Transfer of fixed assets (including the ones derived from any sale, transfer, disposition or Transfer of fixed assets resulting from a casualty or condemnation and including any amount received by any insurance policy that represents an insurance payment that has not been applied and will not be applied to the payment or repairs or replacements of any fixed asset that was damaged or destroyed) for (i) the payment of any current Indebtedness

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

at that moment, (ii) the investment in the assets related to the Core Business of the Borrower, or (iii) any combination of the above.

 

(h)         Payment of Obligations. The Borrower will pay and cause its Material Subsidiaries to pay, all taxes, contributions, assessments and other governmental charges imposed, assessed or required directly on them or any of its Assets in respect of its franchises, businesses or utilities, before any fines or recharges are generated and will pay all claims (including employment, services, materials and suppliers) over the due and payable amounts and that by law constitute or may constitute a Lien over its Assets, unless the lack of said payment could not be reasonably expected to have a Material Adverse Effect or if said charge or claim has been challenged in good faith through appropriate, legal proceedings, duly initiated and conducted, and the reserves or provisions required in accordance with the IFRS, in its case, were constituted.

 

(i)             Precedence. The Borrower will make the Loan to have at all moments a precedence of payment at least equivalent (par passu) in respect of the other unguaranteed and not subordinated Indebtedness of the Borrower (with the exception of those obligations of payment that have preference according to the law).

 

(j)            Compliance with the Law. The Borrower will comply and will oblige its Material Subsidiaries to comply with all applicable Legal Requirements, including, without limitation, all applicable Environmental Laws and all Legal Requirements regarding employment and social security; except when compliance is challenged in good faith through appropriate legal processes duly initiated and conducted and the reserves or provisions required under the IFRS, in its case, have been constituted, or if the lack of compliance could not be reasonably expected to have a Material Adverse Effect.

 

(k)         Maintenance of Books and Registries.

 

(i)                                     The Borrower will maintain and will cause its Subsidiaries incorporated in accordance with Mexican laws to maintain the books, accounts and other registries in accordance with the IFRS and the Borrower will oblige its Subsidiaries incorporated under other jurisdictions to maintain its books and registries in accordance with, either principles of accountability generally accepted of the applicable jurisdiction or with the IFRS.

 

(ii)                                  The Borrower will allow and will make its Material Subsidiaries to allow that the Administrative Agent’s Attorney-in-facts visit and inspect its corresponding Assets and will examine the corresponding corporate, financial and operation books and the registries, in reasonable time and during the normal business hours, as soon as they may desire in a reasonable manner through reasonably prior notice to the Borrower or the Material Subsidiary; provided that, when an Event of Default occurs, the Administrative Agent will be able to do everything above, at the expense of the Borrower at any moment during the normal business hours, without prior notice.

 

(l)             Other Obligations. The Borrower, at its own expense, will subscribe and deliver to the Administrative Agent all other documents, instruments and agreements, and will carry out the necessary procedures, all of them required in a reasonable manner by the Administrative Agent and/or its lawyers, in order to allow said Administrative Agent or the Creditors to exercise and demand the compliance of the rights that this Agreement and any Note confers to them and to carry out the compliance of this Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

ELEVENTH. Negative Covenants. Starting on the Closing Date and whilst any payable amount in accordance with the Loan Documents remains unpaid, the Borrower undertakes to the following:

 

(a)         Liens. The Borrower will not create, nor will it allow its Material Subsidiaries, whether directly or indirectly, to create, incur, assume or allow any Lien to exist in respect of its Assets, current or future, except for:

 

(i)                                     Liens created over any Asset (or class of Assets, in the case of a line of credit guaranteed with inventory or accounts receivable) that exists on the Closing Date.

 

(ii)                                  Liens created over an asset that guarantees, in whole or in part, the purchase price of goods or assets (including inventories) or a portion of the cost of construction, development, modification or improvement of a property, installation or asset, or incurred or assumed Debt only to finance all or a part of the cost of acquisition, construction, development, modification or improvement of a property, construction or asset, which lien was created over said good, construction or asset during the period in which said good, construction or asset has been built, developed, modified or improved within the 120 (one hundred and twenty) calendar days following the acquisition, construction, development, modification or betterment thereof;

 

(iii)                               Liens of a Subsidiary that was incorporated prior to it becoming a Subsidiary of the Borrower, which (A) do not guarantee Indebtedness that exceeds the total of the principal of the Indebtedness subject to said Liens before the Subsidiary in question became a Borrower’s Subsidiary; (B) are not created over Assets that are not the Assent on which the Lien was constituted before said Subsidiary became a Borrower’s Subsidiary, and (C) were not constituted contemplating that said Subsidiary would become a Subsidiary of the Borrower;

 

(iv)                              Liens over an existing Asset at the time of acquiring said Asset and that was not created in relation with, or considering, said acquisition;

 

(v)                                 Liens over any Asset (or class of Assets, in the case of a line of credit guaranteed by inventory or accounts receivable) that guarantees an extension, renewal, refinancing or substitution of Indebtedness or a line of credit guaranteed by a Lien to which sections (i), (ii), (iii) or (iv) above are referring to; provided that, said Lien limits to the Assets (or class of Assets, in the case of a line of credit guaranteed with inventory or with accounts receivable) that are subject to said Lien, existing prior to said extension, renewal, refinancing or substitution and; provided that, the principal amount of Indebtedness or the amount of the line of credit guaranteed by the Lien above is not increased before or by consideration of or in relation with said extension, renewal, refinancing or substitution;

 

(vi)                              Liens created to guarantee the payment of taxes, contributions, assessments and other charges determined by the Governmental Authorities, whose payment has not yet expired or whose payment was challenged in good faith through appropriate legal proceedings duly initiated and conducted and for which the reserved or provisions required in accordance to the NIIF, were constituted or, in case of Material Subsidiaries constituted in another jurisdiction, as requires by the applicable accounting principles in said jurisdiction;

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(vii)         Liens incurred or deposits made in the ordinary course of business in relation with the payment of compensations to the employees and obligations on social security.

 

(viii)        Liens imposed by law, for landlords, transporters, warehouse owners (bodegueros), mechanics, material suppliers, suppliers of repair and similar services arising during the ordinary course of business, for amounts that have not expired or which payment was challenged in good faith through the appropriate proceedings duly initiated and conducted and for which the reserved or provisions required by the IFRS, were constituted or, in case of the Material Subsidiaries constituted in another jurisdiction, as required by the applicable accounting principles in said jurisdiction;

 

(ix)          Liens created by means of foreclosure or judgment, unless said judgment guaranteed by it is not discarded or its execution suspended for a pending appeal within the 60 (sixty) days following its notice, or that it is nor discarded within the 60 (sixty) days following said suspension expires;

 

(x)           Liens created in relation with the Allowed Hedging Agreements over cash or Equivalents to Cash or over raw material underlying to said Allowed Hedging Agreements, to the extent that said Allowed Hedging Contracts include the purchase and sale of said raw material: provided that, the face value of said assets subject to a Lien does not exceed in its totality the sum of USD$50,000,000.00 (fifty million Dollars 00/100) (or its equivalent in another currency) at any moment.

 

(xi)          Liens that guarantee dispositions of credit for working capital that does not exceed the greater total between: (A) USD$100,000,000.00 (one hundred million Dollars 00/100) (or its equivalent in another currency), and (B) (1) 15% (fifteen percent) of the Borrower’s Consolidated Equity, minus (2) the amount of any Guaranteeing Obligation assumed by the Borrower or any of its Consolidated Subsidiaries in favor of the parties that are not the Borrower or its Consolidated Subsidiaries; and

 

(xii)         Liens related to the protection of bank overdrafts or credit contracts celebrated by the Borrower to guarantee bank overdrafts incurred in the ordinary course of business.

 

(b)   Investments. The Borrower will not make, nor allow its Material Subsidiaries to make, Investments, except for:

 

(i)            Existing Investments on the date of this Agreement;

 

(ii)           Investments related with the Borrower’s Core Business different from the Investments in any Venezuelan Subsidiary;

 

(iii)          Investments in Equivalents to Cash;

 

(iv)          Investments of the Borrower in any Subsidiary different from the Investments in any Venezuelan Subsidiary or made by any Material Subsidiary in the Borrower or in any other Subsidiary different from the Venezuelan Subsidiaries;

 

(v)           Investments consisting in extensions of credit through accounts receivable or payment documents that arise from a sale or lease of goods or services in the ordinary course of business;

 

(vi)          Capital Investments;

 

(vii)         Subject to the limitations established on the following letters (f) and (h), the Borrower’s or any Material Subsidiary’s Obligations to Guarantee in relation with the obligations with any Subsidiary of the Borrower different from the Venezuelan Subsidiaries;

 

(viii)                      Allowed Hedging Agreement; and

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(ix)          Investments of any Venezuelan Subsidiary in another Venezuelan Subsidiary with funds in said Venezuelan Subsidiary.

 

(c)   Mergers, Consolidations, Dispositions and Leases. The Borrower will not be able to, nor will it allow its Material Subsidiaries to merge, split, nor consolidate with any Person, nor dispose of or lease substantially its goods or assets as a whole to any Person, except:

 

(A)  In case of mergers or consolidations between the Borrower and any of its Subsidiaries or between the Subsidiaries of the Borrower, in both cases, as long as immediately after said merger comes into effect, it does not occur and continue, a Default or Event of Default; and

 

(B)  In the case of mergers and consolidations of the Borrower with any Person immediately after said merger or consolidation comes into effect:

 

(i)            Any Default or Event of Default does not occur and continues; and

 

(ii)           Any Person incorporated as a consequence of said mergers, splits or consolidates with the Borrower, or the Person that acquires through transfer or disposal or lease, the goods and assets of the Borrower substantially as a whole, expressly assumes, in writing, the duly and timely payment of principal and of the interests of all the obligations in accordance to its terms, and duly and timely compliance with all obligations of the Borrower in accordance with this Agreement through an instrument, formally and substantially reasonably satisfactory for the Administrative Agent, jointly with the delivery of an acceptable legal opinion for the Administrative Agent, obtained on behalf of and by cost of the Borrower, and in which the Administrative Agent and the Creditors can base off of.

 

(d)   Restricted Payments. The Borrower will abstain from making, and will not allow its Subsidiaries to make, directly or indirectly, any Restricted Payment or to assume the obligation to do so (contingent or otherwise), unless (i)the Borrower’s Leverage Ratio, once the Restricted Payment is effected and, without duplication, any other Restricted Payment made since the ending of the most recent first Tax Trimester, were inferior to the maximum Leverage Ratio allowed in accordance with letter (j) of this Clause Eleventh for the corresponding Measure Period and (ii) a Default or Event of Default has not occurred or continued.

 

Notwithstanding the limitation above, the Borrower or any subsidiary will be able to declare or make the following Restricted Payments:

 

(i)            Each of the Subsidiaries will be able to make Restricted Payment to the Borrower and to Subsidiaries property of the Borrower as a whole, whether directly or indirectly, wholly of the Borrower, (and, in case of Restricted Payments made by a Subsidiary whose property is not totally, directly or indirectly, of the Borrower, the Borrower and any Subsidiary and the other owners of the social capital of said Subsidiary in a proportional way of its shareholding);

 

(ii)           The Borrower and each of the Subsidiaries may declare and make payments of dividends or other payable distributions only in the common shares of said Person;

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(iii)          Each of the Subsidiaries may buy, redeem or acquire representative shares of its social capital or guarantees or options to buy said shares with the resources received from concurring issuing of new ordinary shares of its capital;

 

(iv)          The Borrower and each of its Subsidiaries may acquire any kind of corporate capital allowed as an Investment in accordance with letter (b) above;

 

(v)           The Borrower will be able to buy shares from Gimsa; and

 

(vi)          The Borrower and Gimsa will be able to buy shares of its own corporate capital.

 

(e)   Limitations in the Payment of Dividends of the Subsidiaries. The Borrower will not execute nor will it allow its Material Subsidiaries to execute any agreements that by their terms expressly prohibit the payment of dividends or other distributions to the Borrower or the allowance of granting a loan to it, that are not in relation with the renewal or extension of any agreement listen in Exhibit ‘‘D’’; provided that (i) the restrictions or prohibitions in accordance to said agreement are not increased as a result of said renewal or extension; and (ii) in relation to said renewal or extension of an agreement that does not contain said prohibition, the Borrower will not agree nor will it accept nor allow its Material Subsidiaries to agree or accept the inclusion of said prohibition.

 

(f)    Limitation of Subsidiaries’ Debt. The Borrower will not allow any of its Consolidated Subsidiaries to constitute, incur, assume or hire any Debt, if at the moment of incurring said Debt and once the proforma effect thereof is considered, the total amount of the Debt of all Consolidated Subsidiaries exceeds 30% (thirty percent) of the Borrower’s and its Consolidated Subsidiaries’ consolidated Debt.

 

(g)   Transactions with Affiliates. The Borrower will not execute, nor will it cause or allow a Material Subsidiary to execute any transaction with an Affiliate of the Borrower, unless it is celebrated in fair and reasonable terms, not least favorable to the Borrower or said Subsidiary that those that they can obtain from an independent market transaction with a Person that it’s not an Affiliate of the Borrower or said Subsidiary.

 

(h)   Guarantees of the Subsidiaries On Certain Debts. Unless it is in relation with the purchase of corn for its production of corn or wheat flour for its production of wheat flour, the Borrower will not allow its Material Subsidiaries to guarantee the Borrower’s Debt, whether directly or indirectly, or in another way acquire liabilities or obligations of any class, over said Debt.

 

(i)    Interest Coverage Ratio. The Borrower will not allow that its Interest Coverage Ratio, at the last day of any Tax Trimester, to be less that 2.50 (two point fifty) to 1.00 (one point zero).

 

(j)    Leverage Index. The Borrower will not allow its Leverage Ratio for any Measurement Period comprehended within the periods detailed below:

 

	
Measurement Period
    	
 
    	
Leverage Ratio
    
	
From   the Closing Date to September 30, 2013
    	
 
    	
Greater   than 4.75 (four point seventy five) to 1.00 (one point zero zero)
    
	
From   October 1, 2013 to September 30, 2014
    	
 
    	
Greater   than 4.50 (four point five zero) to 1.00 (one point zero zero)
    
	
From   October 1, 2014 to September 30, 2015
    	
 
    	
Greater   than 4.00 (four point zero zero) to 1.00 (one point zero zero)
    
	
From   October 1, 2015 onwards
    	
 
    	
Greater   than 3.50 (three point five zero) to 1.00 (one point zero zero)
    

 

(k) Hedging Agreements Limitations. Neither the Borrower, nor its Subsidiaries will be able to execute different Hedging Agreements from the Allowed Hedging Agreements.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

TWELFTH. Conditions to Borrowing. (a) The obligation of each Creditor to grant its Loan in accordance with this Agreement is subject to the satisfaction of each of the following conditions precedent and the Administrative Agent shall have received (as it applies) evidence that said conditions have been complied with in form and substance satisfactory (of said evidence) to the Administrative Agent and the Creditors:

 

(i) Loan Agreement. This Agreement shall be duly executed by each of the parties hereto;

 

(ii) Organizational Documents and Powers of Attorney. That the Administrative Agent shall have received copies of the public deeds that contain (A) the current bylaws of the Borrower, (B) the sufficient powers of attorney from the attorneys-at-law of the Borrower to execute this Agreement, the Notes and other Loan Documents;

 

(iii) Certificate of the Borrower’s Secretary. That the Administrative Agent shall have received a certificate from the Secretary or Substitute Secretary of the Borrower substantially in the format from Exhibit ‘‘7’’: (A) which states the names and authentic signatures of the Borrower’s authorized officers to execute and subscribe this Agreement, the Notes and other Loan Documents; and (B) certifies that any corporate resolutions of the Borrower have been obtained, and, in its case, the Governmental Approvals, with respect of the authorization for the execution of each of the Loan Documents; and (C) That said certificate of the Secretary establishes that the corporate resolutions have not been modified, amended, revoked as of the date of said certificates;

 

(iv) Governmental Authorizations. That all approvals, authorizations or consents, notices or registries before any Governmental Authority (including the change of control approvals) or third parties, if any, that are required in relation to the subscription, execution and compliance of this Agreement on the Borrower’s side have been obtained and remain valid. The Borrower shall deliver to the Administrative Agent satisfactory records for said Agent of such approvals and of their effectiveness and if said authorizations, consents, permits, notices or registries were not necessary, a certificate shall be delivered to the Administrative Agent signed by the Responsible Officer of the Borrower expressing so;

 

(v) Change in Conditions. That no circumstance and/or event of financial, political or economic nature has emerged in Mexico or in the international financial, banking or capital markets, that could reasonably be expected to have as a consequence a Material Adverse Effect for the Borrower and its Subsidiaries;

 

(vi) Legal Opinions. (A) That the Administrative Agent received a favorable opinion of Salvador Vargas, Esq.,General Counsel of the Borrower, substantially in the form of Exhibit ‘‘8’’, and (B) a favorable opinion of Ritch Mueller, S.C., counsel to the Administrative Agent;

 

(vii) Payment of Commissions and Fees. That the Borrower has paid and that the Administrative Agent has received in a satisfactory way, the payment receipts (A) from all commissions, fees and expenses that the Borrower has to pay to the Creditors and to the Administrative Agent on or before the Maturity Date, and (B) all reasonable costs and expenses that are owed and payable to the Administrative Agent on the Closing Date, together with the reasonable and documented legal costs for the preparation and execution of this Agreement incurred by the Administrative Agent, as it was invoiced on the Closing Date or before, plus the additional amounts of estimates of said legal costs in which the Administrative Agent incurs or may incur due to the closing proceedings, and (C) any other due amount at that amount an

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

payable in accordance to this Agreement;

 

(viii) Responsible Officer Certificate. That the Administrative has received, in terms of the format attached in Exhibit ‘‘9’’ of this Agreement, a certificate subscribed by a Responsible Officer, on the Closing Date, affirming that:

 

(1)   the representations made by the Borrower in accordance to this Agreement, are true and correct in all relevant aspects on the Closing Date;

(2)   no Event of Default has occurred or being continued; and

(3)   since March 31, 2013 (A) no fact or circumstance has occurred that has had or could reasonably be expected to have a Material Adverse effect and (B) no fact or circumstance of financial, political or economic nature in Mexico has occurred that has had or could reasonably be expected to have a Material Adverse Effect over the Borrower’s capability to comply with all its obligations under this Agreement or any of the other Loan Documents;

 

(ix) Audited Financial Statements. That the Administrative Agent has received a copy of the consolidated financial statements of the Borrower in respect of the Tax Year ended on December 31, 2012 and audited by a firm of accountants with renowned international prestige; and

 

(x) Delivery of Other Documents. That the Administrative Agent has received any other document, including certificate, power of attorney, approval, legal opinion, documents or materials, that the Administrative Agent or any Creditor (through the Administrative Agent) requested from the Borrower in a reasonable manner.

 

(b) For the Borrowing, the Borrower shall comply with the following conditions.

 

(i)            Closing Date. That the Closing Date has occurred and taken full effects;

(ii)           Borrowing Notice. That the Administrative Agent has received from the Borrower a Borrowing Note;

(iii)          Delivery of Notes. That the Borrower delivers on the Borrowing Date to the Administrative agent, a Note for the amount of said Borrowing dated on the Borrowing Date, subscribed by the Borrower in favor of each of the Creditors, as it corresponds in accordance to the Commitments of each of them;

(iv)          Representations. That the representations made by the Borrower in accordance to this Agreement or any other Loan Document, or that are contained in any document delivered to the Administrative Agent or the Creditors at any moment in accordance to this Agreement are true and correct in all relevant aspects on the Borrowing Date and further, unless said representation specifically refer to an earlier date, in which case they shall be true and correct in all relevant aspects on said earlier date and with the exception that for this section (iv), the representations made under section (f)(i) and (ii) from Point I of the Representations contained in this Agreement are considered to be referring to the most recent financial statements delivered under Clause Tenth, letter (a)(i) and (ii) of this Agreement, and

(v)           Default. That no Default or an Event of Default has occurred, or being continued, whether before or after giving effect to the Borrowing on the Borrowing Date.

 

THIRTEENTH. Events of Default.  (a) For purposes of this Agreement, any of the following events shall constitute an “Event of Default”:

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(i)            Non-Payment. The Borrower fails to pay (A) when and as required to be paid herein, any amount of principal of any Loan, or (B) within five days after the same becomes due, any interest or any other amount payable according to this Agreement or under any other Loan Document; or

 

(ii)           Representations. In the case that any representation of the Borrower made under this Agreement or in another Loan Document, or which is contained in any certificate, document or financial or other statement by the Company or any Responsible Officer of the Company, furnished at any time under this Agreement or any other Loan Document, is incorrect in any material respect on or as of the date made; or

 

(iii)          Specific Defaults. If the Borrower (A) fails to perform or observe any term, covenant or agreement contained in Clause Tenth, letters (b)(i), (c), (e), (f), or (i), or fails to perform or observe any term, covenant or agreement contained in Clause Eleventh (other than letters (e), (g) o (h)) or fails to issue new Notes in exchange for the existing Notes as provided herein ; (B) fails to observe the covenant set forth in Clause Eleventh letter (k) and such default continues un-remedied for a period of 3 Business Days; or

 

(iv)          Other Defaults. The Borrower fails to perform or observe any other term or covenant contained in this Agreement or in any other Loan Document, and such default continues un-remedied for a period of 30 (thirty) days after the date upon which written notice thereof is given to the Borrower by the Administrative Agent or any Creditor; or

 

(v)           Cross-Default. If The Borrower or any of its Material Subsidiaries (A) fails to make any payment in respect of any Indebtedness (other than Indebtedness under this Agreement and under the Notes) having an aggregate principal amount of more than US$20,000,000.00 (twenty million Dollars 00/100) (or the equivalent in another currency) when due (whether by scheduled maturity, required early payment, acceleration, demand, or otherwise) and such failure continues after the applicable grace period, if any, specified in the agreement or instrument relating to such Indebtedness; or (B) fails to perform or observe any other condition or covenant, or any other event shall occur or condition exist, under any agreement or instrument relating to any such Indebtedness, and such failure continues after the applicable grace or notice period, if any, specified in the relevant document on the date of such failure if the effect of such failure, event or condition is to cause, or to permit the holder or holders of such Indebtedness to cause, such Indebtedness to be declared to be due and payable prior to its stated maturity; or

 

(vi)          Involuntary Proceedings. (A) If a decree or order by a court having jurisdiction has been entered adjudging the Borrower or any Material Subsidiary as bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, concurso mercantil, quiebra or bankruptcy of the Borrower or any Material Subsidiary and such decree or order shall have continued undischarged and unstayed for a period of 90 (ninety) days; or (B) a decree or order of a court having jurisdiction for the appointment of a receiver or liquidator or visitador, conciliador or síndico or trustee or assignee in bankruptcy or insolvency or any other similar official of the Company or any Material Subsidiary or of any substantial part of the Property of the Company or any Material Subsidiary or for the winding up or liquidation of the affairs of the Company or any Material Subsidiary has been entered, and such decree

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

or order has continued un-discharged and un-stayed for a period of 90 (ninety) natural days; or

 

(vii)         Voluntary Proceedings. The Borrower or any Material Subsidiary institutes proceedings to be adjudicated a bankrupt or consents to the filing of a bankruptcy proceeding against it, or files a petition or answer or consent seeking reorganization, concurso mercantil, quiebra or bankruptcy or consents to the filing of any such petition, or consents to the appointment of a receiver or liquidator or trustee or visitador, conciliador or síndico or assignee in bankruptcy or insolvency or any other similar official of the Borrower or any substantial part of its Assets; or

 

(viii)        Judgments. If one or more judgments, orders, seizures or embargos, decrees or arbitration awards are entered against the Borrower or any of its Material Subsidiaries involving in the aggregate a liability (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage) as to any single or related series of transactions, incidents or conditions, of US$20,000,000.00 (twenty million Dollars 00/100) or more (or the equivalent thereof in another currency), and the same shall remain unsatisfied, un-vacated or un-stayed pending appeal for a period of 90 days after the entry thereof; or

 

(ix)          Enforceability. If this Agreement or any of the Notes for any reason is suspended or revoked or ceases to be in full force and effect in accordance with its respective terms or the binding effect or enforceability thereof is contested by the Borrower, or it denies that it has any further liability or obligation hereunder or there under or in respect hereof or thereof, or performance by the Borrower under any of the Notes or in respect herein and therein, or the law prohibits the compliance by the Borrower of any of the Law Documents or Borrower determines that any obligation under a Loan Document has been prohibited by law; or

 

(x)           Expropriation. If any Governmental Authority in Mexico or the United States of America nationalizes, seizes or expropriates all or a substantial portion of the assets of the Borrower and its Subsidiaries, taken as a whole, or of the common stock of the Borrower, or the Mexican government or an agency or instrumentality thereof assumes control of the business and operations of the Borrower and its Subsidiaries, taken as a whole; or

 

(xi)          Change of Control. If Mrs. Graciela Moreno Hernández and/or the respective family members (including spouses, siblings and other lineal descendants, estates and heirs, or any trust or other investment vehicle for the primary benefit of any such Person or their respective family members or heirs) of the deceased Mr. Roberto Gonzalez Barrera and/or Mrs. Graciela Moreno Hernandez, fail to elect the majority of the Board of the Directors of the Borrower.

 

(b) At the moment in with any of the Events of Default occur, the Administrative Agent shall, at the request of the Majority of Creditors, or it could, with the consent of the Majority of Creditors, take all and any of the following measures:

 

(i)            Terminate the Commitments of any Creditor;

(ii)           Declare the outstanding balance of the Loan, interests and other accessories as immediately due and payable of, through declaration in writing delivered to the Borrower, and without

 

 

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demand, resolution or presentment or other notice of any other nature, to which the Creditor expressly renounces; and

(iii)          In its case, exercise on behalf of itself and on behalf of the Creditors, all rights and remedies available to it in accordance with the Loan Agreements or the applicable legislation;

 

Provided that, upon the occurrence of ant event specified in sections (a)(vi) or (vii) above, the Commitment of each Creditor shall be automatically terminated and the principal unpaid amount of the outstanding Loan and all interests and other obligations of the Borrower in accordance to this Agreement will automatically be deemed due and payable without further action or act by the Administrative Agent or another Creditor.

 

(d)   Any amount received by the Administrative Agent pursuant letter (a) above, will be applied as follows:

 

First, to the payment of commissions, fees, indemnities, expenses and any other amount due to the Administrative Agent acting in such character in accordance to this Agreement;

 

Second, to the payment of commissions, expenses, fees, indemnities and any other amount (that is not capital and interests) owed to the Creditors, pro rata between them in accordance to its Commitments and in proportion of the amounts described in this Second part;

 

Third, to the payment of accrued and unpaid late interests over the outstanding balance of the Loan, pro rata between the Creditors in accordance with their Commitments and in proportion to the amount of the quantities described in this Third part;

 

Fourth, the payment of accrued and unpaid ordinary interests over the outstanding balance of the Loan, pro rata between the Creditors in accordance to its Commitments and in proportion to the amount of the quantities described in this Fourth part;

 

Fifth, the payment of the outstanding balance of capital of the Loan, pro rata between the Creditors in accordance to its Commitments and in proportion to the amount of the quantities in this Fifth part;

 

Last, the outstanding balance, if any, once all obligations of payment in charge of the Borrower in accordance to this Agreement have been indefeasibly paid, will be delivered to the Borrower.

 

FOURTEENTH. Illegality, Increase in Costs. (a) If any of the Creditors determines, following the execution date of this Agreement, that pursuant to any amendments in any law, regulation, bulletin or other provision applicable to any Creditor or any of its offices in charge of the administration and funding of the Loan, or changes in the interpretation of any of them by any court or competent Governmental Authority and, as a consequence of the aforementioned, it were illegal for the Creditor to make or maintain the corresponding Loan in force, said Creditor will be considered as an ‘‘Affected Creditor’’ and shall, through the Administrative Agent, request in writing the declaration of early termination of the unpaid portion of the Loan corresponding to its Commitment, without any penalty for the Borrower,  together with accrued interest, any other payable accessories; provided that, the Borrower shall have the right, with the consent of the Administrative Agent, to find an Eligible Assignee

 

 

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to acquire the rights and obligations of the Affected Creditor, and also, provided that, the Creditors not considered as Affected Creditors shall not have the right to request the early payment of the Loan owed to them under this Agreement.

 

(b) If any one of the Creditors determines in a reasonable manner, following the date of execution of this Agreement, that pursuant to the modifications to any law, regulation, bulletin or other provision (including without limitation, requirement in respect of the capitalization of Creditors, reserves, deposits, ordinary or extraordinary contributions (or any Governmental Authority), taxes and other conditions, but excluding provisions regarding income tax or other similar applicable to the Creditors (their assignees, participants or acquirers in terms of the Clause Fifteen below) in relation to its income o total assets in accordance with the laws, regulations and other applicable legal provisions in Mexico), applicable to said Creditors, any of its offices in charge of the administration or funding of the corresponding Loan or the changes to the interpretation by any court or competent authority of any thereof, and as a consequence of any of the facts above the cost increases for said Creditor to grant or maintain the corresponding Loan in force, or the received amounts decreased or to be received by said Creditor, the Borrower, at the request of the Administrative Agent, will pay to said Creditor, through the Administrative Agent, the last day of the current Interest Period in said moment or the date that is 10 (ten) Business Days after said request, whichever is last, the additional reasonable amounts, that are required to compensate the Creditor for said increase in cost or decrease in income. In the request of the Administrative Agent the causes for the increase in cost or decrease in income will be specified, as well as its respective calculations and, except for an error in said calculations, the determination of the Administrative Agent will be conclusive and binding for the Borrower. The obligation of the Borrower to compensate the Creditors in accordance with this letter (b) will end 90 (ninety) natural days after the Maturity Date.

 

(c) Any Creditor that requests reimbursement or compensation under this Clause Fourteen will have to deliver the Borrower (with copy to the Administrative Agent) a certificate establishing in detail, as is reasonable, the amount that will have to be paid to said Creditor under this Agreement and the reasons to make such claim and said certificate will be conclusive and binding for the Borrower in the absence of any manifested error.

 

(d) Each Creditor agrees to give notice to the Borrower in case of any claim of reimbursement in accordance with letters (a) and (b) above, no later than 60 (sixty) days after one officer of the Creditor responsible for the administration of this Agreement, received knowledge of the facts that gave place to said claim. If the Creditor does not give notice, the Borrower will only have the obligation to reimburse or compensate the Creditor, retroactively, for the claims related to the period of 60 (sixty) days immediately before the date in which the claim was made.

 

(e) The Creditors undertake, once a case of illegality or a case of increase in costs or decrease in income occurs, in accordance with letters (a) and/or (b) of this Clause Fourteen, to make its best efforts, as long as it is requested by the Borrower (and subject to the considerations of the general policies of the Creditor) to designate any other of its offices that fund loans to eliminate said case of illegality or case of increase in costs or decrease in income, as long as it does not result in economic, legal or regulatory disadvantage for the Creditors in question or its offices that fund loans.

 

(f) When the Borrower receives a claim of payment or compensation under this Clause Fourteen and Clause Ninth, letter (b)(i), the Borrower shall, at its own choice, request from said Creditor to make its best effort to search an Eligible Assignee that is willing to acquire the Loan of said Creditor and assume

 

 

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the rights and obligations of said Creditor in accordance with this Loan through the execution of an Assignment and Acceptance; provided that, that Creditor will not be replaced or dismissed in accordance with this Agreement until the total owed amounts in accordance with this Agreement and other Loan Documents have been paid to said Creditor, unless the amounts that the Creditor pretends to charge under this Clause Fourteen are challenged by the Borrower in good faith.

 

FIFTEENTH. Assignments and Participations. (a) Any Creditor may assign, and if requested by the Borrower under Clause Fourteen, letter (f) shall, at any moment, assign one or several Eligible Assignee, all or a part of its Loan and rights and obligations said Creditor, in accordance with this Agreement for a minimum amount of $60,000,000.00 (sixty million Mexican Pesos 00/100), with the written consent of the Borrower, which shall not be conditioned or denied without justified reason and in the case that an Event of Default has occurred and be continuing, said consent of the Borrower will not be required (provided that, also, (i) any obligation that results in the payment of additional costs in accordance with Clauses Ninth, letter (b)(i) or Fourteen of this agreement starting on the date that said assignment occurs, it would justify the Borrower to deny such consent, (ii) except for the case that an assigning Creditor does not comply with letter (c) below, the consent of the Borrower will not be considered as granted unless the Borrower replies in writing any request of consent within the five Business Days following the receipt of said request, and (iii) with respect to the Eligible Assignees described in section (vi) of the definition of ‘‘Eligible Assignees’’, any assignment to any of the Eligible Assignees will be subject to the absolute discretion of the Borrower) and with the confirmation of the Administrative Agent with respect of the payment of the management commission referred to in section (D)(3) below; provided that, the consent in writing of the Borrower in the assignments made by any Creditor to its Affiliates and /or Subsidiaries will not be required as long as the Borrower is not obliged to pay additional amounts in accordance with Clauses Ninth, letter (b)(i) and Fourteen whose payment would not be required if it was not for said assignment) (each a ‘‘Assignee’’, however, (A) if an Event of Default occurred and is continued at the moment of the assignment, any Creditor may assign to any third party the proportional part of the Loan that corresponds to it in accordance to its Commitment: (B) after any assignment, the established dispositions in Clause Twenty Four will come into effect in benefit of the assigning Creditor to the extent that it is related with events, circumstances, claims, costs, expenses or responsibilities that emerged before said assignment; (C) in the case of an assignment to an entity described in section (vi) of the definition ‘‘Eligible Assignee’’, the Creditor in question will provide the Borrower with information and documents relative to the proposed assignee as requested by the Borrower; and (D) the Borrower and the Administrative Agent may continue negotiating only with said Borrower in what respects to the assigned rights and obligations to the Assignee and the assignment will not be effective until: (1) the assigning Creditor and its Assignee deliver to the Borrower and the Administrative Agent a notice in writing informing them of said assignment, together with the payment instructions, addresses and information related to the Assignee; (2) the assigning Borrower and its Assignee have delivered to the Borrower and the Administrative Agent an Assignment and Acceptance in the format of Exhibit ‘‘10’’  (‘‘Assignment and Acceptance’’): (3) the assigning Creditor or the Assignee has paid to the Administrative Agent a management commission for the amount of USD$3,500.00 (three thousand five hundred American dollars 00/100) (said management commission will be payable in all assignments, including without limitation, the assignment of a Creditor to another Creditor); and (4) except if an Event of Default occurs and it is continued, that the Assignee has delivered to the Borrower, in case it is applicable, copy of the tax residency certificate that shows the residency of the Assignee, as stipulated above.

 

(b) Starting on the date that the Administrative Agent notifies the assigning Creditor that has received an Assignment and Acceptance signed by all parties thereof, as it corresponds, as well as the payment

 

 

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for the management commission, (i) the Assignee in question will be a party of this Agreement, and to the extent that all rights and obligations of this Agreement were assigned in accordance with said Assignment and Acceptance, the Assignee will have the rights and obligations of a Creditor in accordance with the Loan Documents, and (ii) the assigning Creditor shall, in accordance with the Assignment and Acceptance, waive its rights and be freed of its obligations under the Loan Documents.

 

(c) The Administrative Agent, acting solely as such, shall maintain a copy of each Assignment and Acceptance that has been delivered to it and a book for the recording of names and addresses of the Creditors and its Commitments and of the amounts of capital of the Loan that are owed to each Creditor in accordance with the terms of this Agreement (the ‘‘Registry’’). The notes in the Registry shall be conclusive, without manifest error, and the Borrower, the Administrative Agent and the Creditors may deal with each Person whose name is recorded in the Registry in the terms of this Agreement, as a Creditor in accordance thereto, notwithstanding that a notice that indicates the contrary exists. The Registry will be at the Borrower’s disposal and of any of the Creditors for its inspection prior notice given to the Administrative Agent.

 

(d) Within the 10 (ten) Business Days following the Borrower receiving a notice of the Administrative Agent that has received an Assignment and Acceptance signed and the payment for the management commission has been made (and as long as the Borrower consents to said assignment in accordance to letter (a) above), the Borrower shall sign and deliver to the Administrative Agent a new Note for the amount of the assigned Loan to said Assignee, and if the assigning Creditor has retained a portion of its Loan, a new Note for the assigning Creditor (such new Notes to be exchanged for the Note in possession of the assigning Creditor, and not be considered as payment). Immediately after each one of the Assignees pays the management commission in accordance with the Assignment and Acceptance, this Agreement will be considered amended to the extent, but only to the extent that is necessary to reflect the addition of the Assignee and the resulting adjustment of the Loan and Commitments that emerge from said amendment.

 

(e) Any Creditor (the ‘‘Originating Creditor’’) may transmit, at any moment, without need for getting consent from the Borrower or the Administrative Agent, to one or more entities that may have been an Eligible Assignee (a ‘‘Participant’’) participations in all or in the proportional part of the Loan in accordance to its Commitment; provided that, (i) the obligations of the Originating Creditor in accordance to this Agreement will remain unchanged, (ii) the Originating Creditor will be the only one responsible of the compliance of said obligations; (iii) the Borrower and the Administrative Agent will remain linked directly to the Originating Creditor in relation to the rights and obligations under this Agreement and the other Loan Documents; and (iv) no Creditor may assign or grant a participation in accordance to which a Participant will have the right to approve a reform or a consent or waive in respect to this Agreement or the other Loan Documents, except until said reform, consent or waive require the unanimous consent of the Creditors; and as long as the Participant, at the moment of acquiring the participation, provides to the Borrower, at the reasonable request of it, the documentation in which it being an Eligible Assignee is stated. In the case that a participation occurs, the Creditor that transfers said participation will have the right to transfer to the Participant any amount received for said Creditor in accordance to Clauses Ninth, letters (b)(i) and Fourteen and if the amounts pending payment hereunder are payable or have been declared as such, or are overdue and shall be paid when an Event of Default occurs, each Participant will have the right to compensate, respect to a participation in owed amounts under this Agreement, to the same extend as if the amount of its participation was owed directly to each Participant as a Creditor in accordance to this Agreement; provided that, said agreement or instrument may stipulate that said Creditor shall not, without the

 

 

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consent of the Participant, accept any reform, waive or other amendment that (A) postponed the date in which a payment of money shall be made to said Participant or (B) reduced the capital, the interests, commissions, fees, or other owed amounts said Participant. Subject to what is established in letter (f) below, the Borrower agrees that each Participant shall have the right to the benefits established in Clause Fourteen above to the same extent as if this was a Creditor and had acquired its interests through assignment in accordance to letter (a) above of this Clause. To the extent that the law allows, each Participant may also have the right to the benefits of Clause Sixteen below as if it was a Creditor.

 

(f) A Participant will not have the right to receive a payment over what is established in Clauses Ninth, letter (b)(i) and Fourteen above, to which the Creditors in question have the right to receive in respect to the participation transferred to said Participant, unless the transfer to said participation to said Participant is made with the previous consent in writing of the Borrower.

 

(g) If the consent of the Borrower is required in relation to an assignment or an Assignee, said consent will be considered granted by the Borrower at the 5 (five) Business Days following to the date in which the Borrower has received the respective notice, unless the Borrower expressly denied such consent before the fifth Business Day of said term.

 

SIXTEENTH. Set-off. In the case that on any date in which the Borrower has to pay to the Creditors any amount in accordance with this Agreement, the Notes or the rest of the Loan Documents and the Borrower does not comply with this obligation of payment, the Borrower, to the extent allowed by the law, will irrevocably authorize and empower the Creditors to (a) charge on any account that the Borrower keeps with each of the Creditors, including without limitation, deposits and/or demand accounts, savings, forward, provisional or definitive, investment accounts, whatever they may be, and (b) set-off any indebtedness that the Creditors may have on their favor and charged to the Borrower for any concept, precisely until an amount equaling the unpaid amount to the Creditors, without needing any presentment, notice or demand, of any nature.

 

The Creditors will give notice to the Borrower and the Administrative Agent as soon as it is possible of any charge or set-off that they may have made in accordance with what is allowed in this Clause, provided that, the lack of said notice will not affect in any way the validity of said charge or set-off. The Creditors’ right in accordance to this Clause is additional to any other right including other set-off rights) that the Creditors may have under the law.

 

SEVENTEENTH. Credit Information. (a) With the purpose of complying with what is stated in the Law to Regulate Credit Reporting Companies (Ley para Regular las Sociedades de Información Crediticia), the Borrower in this same date shall deliver to the Creditors and the Administrative Agent a letter of authorization duly executed by its Attorneys-in-Fact, which is attached hereto as Exhibit ‘‘11’’, in order to authorize the Creditors and Administrative Agent to make periodic consultations to the credit reporting companies in respect of the credit history of the Borrower, as well as to empower them to give the credit information of the Borrower to said companies.

 

(b) In addition to the people and authorities that article 93 and 117 of the Mexican Law of Credit Institutions (Ley de Instituciones de Crédito) makes reference to, the Borrower authorizes the Creditors and the Administrative Agent to disclose the information derived from the operations that this Agreement makes reference to and the other Loan Documents to (i) other financial entities members of the financial group of each of the Creditors (if any), and the headquarters, directly or indirectly of the Creditor in question, (ii) the regulatory authorities of the Creditors and the headquarters of the

 

 

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Creditors, (iii) Banco de Mexico, and (iv) other people with which the Creditors contract, especially in accordance with Clause Fifteen.

 

EIGHTEENTH. Administrative Agent; Majorities.

 

(a)         Appointment of the Administrative Agent. Each Creditor, hereby, irrevocably appoints, designates and authorizes Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa, as ‘‘Administrative Agent’’ in accordance to this Agreement, and each Creditor in this act irrevocably authorizes the Administrative Agent to execute acts on its behalf under the provisions of this Agreement and the Loan Documents and to exercise the powers and comply with the duties that are expressly delegated to it in the terms of this Agreement and the Loan Documents, together with the powers that are reasonably incidental for said effect. Also, in this act, each of the Creditors authorizes and appoints the Administrative Agent as a commission agent in accordance with articles 273 and 274 of the Mexican Code of Commerce (Código de Comercio) to sign, execute and comply with any Loan Document that the Administrative Agent is a part thereof, as well as any other necessary or convenient document, contract, agreement or instrument for the execution, formation, subscription and settlement of the Loan Documents or Lien that may be granted in accordance with this Agreement. Notwithstanding any provision stating otherwise contained in this Agreement or any of the Loan Documents, the Administrative Agent will not have other duties or responsibilities from the ones established herein, nor will the Administrative Agent have, nor will it be considered to have, a fiduciary relationship with any Creditor or Participant, and will not imply the existence of any agreement, function, responsibility, duty or obligation under this Agreement nor any other Loan Document, nor will they exist against the Administrative Agent. Without limiting the generality of the above, the use of the term ‘‘agent’’ herein and other Loan Documents in reference to the Administrative Agent, it shall not be understood in any way that implies any fiduciary obligation or other, implicit (or expressed), that arises under the doctrine of the representation of any applicable law. In its place, said term will be used only as commercial and it is intended to create or reflect only one administrative agent between independent contracting parties.

 

(b)         Delegation of Duties. The Administrative Agent will be able to carry out any of its obligations under this Agreement or any other Loan Document by or through its representatives, employees, attorneys-in-fact and will be able to receive opinions from lawyers in relation with all matters related with said duties. The Administrative Agent will be liable for negligence or misconduct of its representatives or attorneys-in-conduct.

 

(c)          Liability of the Administrative Agent. Neither the Administrative Agent nor any of its Affiliates, officers, directors, employees, agents or attorneys-in-fact shall (i) be liable for any action or failure by it or any such Person under or in connection with this Agreement or any other Loan Document or the transactions contemplated hereby (except for its own gross negligence or willful misconduct), or (ii) be responsible in any manner to any Creditor or any Participant for any recital, statement, representation or warranty made by the Company, or any officer thereof, contained in this Agreement or in any other Loan Document, or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or any other Loan Document, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any failure of the Company to perform its obligations hereunder or there under. Except as otherwise expressly stated therein, the Administrative Agent shall not be under

 

 

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any obligation to any Creditor or any Participant to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of the Company or any of its Subsidiaries.

 

(d)         Reliance. (i) The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, communication, signature, resolution, representation, notice, consent, certificate, affidavit, letter, telegram, facsimile, telex, teletype or telephone message, electronic mail message, statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to the Company), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Majority of Creditors as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Banks against any and all liability and expense which may be incurred by it by reason of failing to take, taking or continuing to take any such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Majority of Creditors (or such greater number of Banks as may be expressly required hereby) and such request and any action taken or failure to act pursuant thereto shall be binding upon all of the Creditors.

 

(ii) For purposes of determining compliance with the conditions specified in Clause Twelfth of this Agreement, each Creditor that has executed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter either sent by the Administrative Agent to such Bank for consent, approval, acceptance or satisfaction, or required there under to be consented to or approved by or acceptable or satisfactory to such Bank unless the Administrative Agent shall have received notice from such Creditor prior to the proposed Borrowing Date specifying its objection thereto.

 

(e)          Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Creditors, unless the Administrative Agent shall have received written notice from a Creditor or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “Notice of Default.” The Administrative Agent will notify the Creditors of its receipt of any such notice in a timely manner, and in the 5 (five) Business Days following the receipt of such notice at the latest. The Administrative Agent shall take such action with respect to such Default or Event of Default as may be directed by the Majority of Creditors in accordance with Clause Thirteen; provided, however, that unless and until the Administrative Agent has received any such direction, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable or in the best interest of the Creditors.

 

(f)           Credit Decision. Each Creditor acknowledges that neither the Administrative Agent nor any of its Affiliates, officers, directors, employees, agents or attorneys-in-fact have made any representation or warranty to it, and that no act by the Administrative Agent hereinafter taken,

 

 

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including any consent to and acceptance of any assignment or any review of the affairs of the Borrower and its Subsidiaries, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Creditor as to any matter, including whether the Administrative Agent has disclosed material information in its possession. Each Creditor represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of an investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of the Borrower and its Subsidiaries and all applicable bank regulatory laws relating to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to the Borrower hereunder. Each Creditor also represents that it will, independently and without reliance upon the Administrative Agent and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of the Borrower and its Subsidiaries. Except for notices, reports and other documents expressly herein required to be furnished to the Creditors by the Administrative Agent, the Administrative Agent shall not have any duty or responsibility to provide any Creditor with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of the Borrower which may come into the possession of any of the Administrative Agent or any of its Affiliates, officers, directors, employees, agents or attorneys-in-fact.

 

(g)          Indemnity. Whether or not the transactions contemplated hereby are consummated, the Creditors shall indemnify upon demand the Administrative Agent and its Affiliates, directors, officers, agents and employees (to the extent not reimbursed by or on behalf of the Borrower and without limiting the obligation of the Borrower to do so), pro rata, and hold the Administrative Agent harmless from and against any and all Indemnified Liabilities; provided, however, that no Creditor shall be liable for the payment to the Administrative Agent of any portion of such Indemnified Liabilities to the extent determined in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from the Administrative Agent’s gross negligence or willful misconduct. Without limitation of the foregoing, each Creditor shall reimburse the Administrative Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by the Administrative Agent in connection with the preparation, execution, delivery, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of the Borrower and without limiting the Borrower’s obligation to do so. The undertaking in this letter shall survive the payment of all Obligations and the resignation of the Administrative Agent.

 

(h)         Administrative Agent in Individual Capacity. Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business with the Borrower and any of the Borrower’s Affiliates as though Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa were not the Administrative Agent hereunder and without notice to or

 

 

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consent of the Creditors. The Creditors acknowledge that, pursuant to such activities, Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa or its Affiliates may receive information regarding the Borrower or any of its Affiliates (including information that may be subject to confidentiality obligations in favor of the Borrower or such Affiliate) and acknowledge that the Administrative Agent shall be under no obligation to provide such information to them. With respect to its Commitment, Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa shall have the same rights and powers under this Agreement as any other Creditor and may exercise such rights and powers as though it were not the Administrative Agent, and the terms “Creditor” and “Creditors” include Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa in its individual capacity.

 

(i)             Successor of the Administrative Agent. The Administrative Agent may resign as Administrative Agent upon 30 (thirty) days’ notice to the Creditors. If the Administrative Agent resigns under this Agreement, the Majority of Creditors shall appoint from among the Creditors a successor agent for the Creditors which successor agent shall be subject to the prior approval of the Borrower at all times other than during the existence of an Event of Default (which consent of the Borrower shall not be unreasonably withheld or delayed). If no successor agent is appointed prior to the effective date of the resignation of the Administrative Agent, the Administrative Agent may appoint, after consulting with the Creditors and the Borrower, a successor agent from among the Creditors. Upon the acceptance of its appointment as successor agent hereunder, such successor agent shall succeed to all the rights, powers and duties of the retiring Administrative Agent and the term “Administrative Agent” shall mean such successor agent and the retiring Administrative Agent’s appointment, powers and duties as Administrative Agent shall be terminated. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Clause Eighteen and of the following Clauses Twenty Three and Twenty Four shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement. If no successor agent has accepted appointment as Administrative Agent by the date which is 30 (thirty) days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective and the Creditors shall perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Majority of Creditors appoint a successor agent as provided for above.

 

NINETEENTH. Enforcement Title. This Agreement, jointly with the account statement certified by the Borrower’s accountant, as the case may be, constitute an enforcement title in terms of article 68 of the Mexican Law of Credit Institutions (Ley de Instituciones de Crédito).

 

TWENTIETH. Notices. (a) For purposes of this Agreement, each party indicates as its address for service the following:

 

The Agent:

 

BANCO INBURSA, S.A., INSTITUCION DE BANCA MULTIPLE,

GRUPO FINANCIERO INBURSA

Paseo de las Palmas No. 736,

Col. Lomas de Chapultepec,

México, D.F. Zip Code 11000

Attention: Felipe Molina Bernal

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Telephone: (5281) 83180450

Facsimile: (5281) 83359400

Email: fmolinab@inbursa.com

 

The Borrower:

 

GRUMA, S.A.B. de C.V.

Calzada del Valle 407 Oriente

Col. Del Valle,

Zip Code 66230, San Pedro Garza García, N.L.

Telephone: +(5281)8399

Facsimile: +(5281) 8399-3357

Email: rcavazosm@gruma.com

 

The Creditors:

BANCO INBURSA, S.A., INSTITUCION DE BANCA MULTIPLE

GRUPO FINANCIERO INBURSA

Paseo de las Palmas No. 736,

Col. Lomas de Chapultepec,

México, D.F. C.P. 11000

Attention: Felipe Molina Bernal

Telephone: (5281) 83180450

Facsimile: (5281) 83359400

Email: fmolinab@inbursa.com

 

BANCO NACIONAL DE COMERCIO EXTERIOR, S.N.C.,

BANCA DE DESARROLLO

Av. Gómez Morín No. 350.

Col. Valle del Campestre,

San Pedro Garza García, Nuevo León

C.P. 66265

Attention: Leonel Napoleón Vásquez Gómez and

Felipe Cárdenas Estrada

Telephone: (5281) 83692121

Facsimile: (5281) 83692155

Email: lvasquezg@bancomext.gob.mx

 

HSBC MEXICO, S.A., INSTITUCION DE BANCA MULTIPLE,

GRUPO FINANCIERO HSBC

Av. Paseo de la Reforma 347,

Col. Cuauhtémoc,

Mexico, D.F., C.P. 06500

Attention: Victor Manuel Elixondo and

Cordelia González Flores

Telephone: (5281) 83192203

Facsimile: (5281) 83192349

Email: Victor.ELIZONSO@hsbc.com.mx

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

(b)         All notices and notifications made under this Agreement will be sent in writing, electronic transmission systems, through courier, facsimile, email or through personal notice and will be effective in the moment in which they are delivered to the recipient and, in the case of notices by facsimile or email, at the moment in which they are transmitted and they obtain confirmation of transmission.

 

(c)          As long as a change of address is not notified in writing, the notices, notifications and other judicial and extrajudicial proceedings made in the indicated addresses will have full effects.

 

TWENTY FIRST. Applicable Law. This Agreement shall be governed and construed in accordance to Mexican laws.

 

TWENTY SECOND. Jurisdiction. For everything related to the interpretation and compliance of this Agreement, the parties submit to the jurisdiction of the courts located in Mexico City, Mexico, waiving to the jurisdiction of any other court that because of its present or future address or by any other reason may correspond to them.

 

TWENTY THIRD. Costs and Expenses. The Borrower will pay to the Administrative Agent and the Creditors, any documented cost or expense, including reasonable costs and expenses, documented and in terms of market and legal advisors outside of the Agent and the Creditors, incurred in connection with the preparation and execution of this Agreement, any Note or any of the Loan Documents. Also, the Borrower will pay to the Administrative Agent and the Creditors, within 30 (thirty) days after demand by the Administrative Agent or by the Creditors, as the case may be, any expense and reasonable fees, documented and in terms of market, legal advisors, incurred in connection with any amendment to this Agreement or any other Loan Document.

 

TWENTY FOURTH. Indemnity. The Borrower undertakes to indemnify the Administrative Agent, any member of the economic group identified as Grupo Financiero Inbursa and the Creditors and their respective directors, officers, employees, lawyers, agents and to bring them at peace from any losses, liabilities, claims, damages or expenses incurred by them, including without limitation, fees and expenses of legal advisors, incurred in relation with said proceeding or process (but excluding any losses, liabilities, claims, damages or expenses derived exclusively in bad faith, fraud, gross negligence and negligence of the Person with right to be indemnified, as determined by final judgment from competent court) that result from (i) the noncompliance of the Borrower’s obligations in accordance to this Agreement and the Loan Documents, (ii) any act or omission of the Borrower in relation to this Agreement and the Loan Documents, (iii) the omission of information or false, incomplete or incorrect information that was provided to the Administrative Agent or the Creditors in relation to this Agreement and the Loan Documents, or (iv) any dispute or proceeding (including threats of disputes or proceedings) related to this Agreement or any of the Loan Documents (the obligation to indemnify in relation to said scenarios, jointly, the ‘‘Indemnification Obligations’’). The obligations of the Borrower under this Clause Twenty Four will remain valid even after the termination of this Agreement.

 

TWENTY FIFTH. Amendments and Waivers.

 

(a)         Any amendment to any Loan Document, will only be considered valid if it was made in writing, subject to what is stated in letter (b) below, signed by the Majority of the Creditors or by the Administrative Agent in representation of the Creditors and the Borrower. Any waivers of rights in accordance to this Agreement will only be valid if they, subject to what is stated in letter (b) below, are recorded in writing by the Majority of the Creditors or the Administrative Agent in

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

representation of the Creditors. If any Creditor, or the Creditors as a group, does not exercise or are delay the exercise of their right in accordance hereof, or any Loan Document, will not be considered, by that fact, that the Creditors or the Administrative Agent, as the case may be, have waived the exercise of their rights.

 

(b)         The following amendments to any Loan Document and the following waivers of rights under the Loan Documents will be authorized by the Creditors that represent 100% (one hundred percent) of the outstanding balance of the Loan:

 

(i)            Increase or extend the Commitment of the Creditors;

(ii)           Postpone or delay any fixed date by this Agreement or a Note for any payment of capital, interest, commissions, fees or other amounts under this or any other Loan Document;

(iii)          Reduce the capital or interest rate stipulated in this Agreement or reduce the amount or change the method of calculation the commissions, fees or other payable amounts under this or any other Loan Document;

(iv)          Amend, modify or cause any condition stipulated in Clause Twelfth, letter (a) to be waived;

(v)           Amend or modify the definition of ‘‘Majority of Creditors’’ or any other provision of this Agreement that specifies the percentage of the Commitments or the percentage or number of Creditors required to amend, waive or modify in another manner the rights hereunder or take determinations or actions hereunder;

(vi)          Amend, modify or waive any disposition of this Clause Twenty Fifth, letter (a); and

(vii)         Amend, modify or waive any disposition of Clause Ninth in a way that may alter the proportional participation required by said Clause;

 

Provided that, in addition to, no amendments, waivers or consent, unless it is in writing and signed by the Administrative Agent, plus the Majority of Creditors or by all Creditors, as the case may be, will affect the rights or obligations of the Administrative Agent in accordance with this Agreement or any other Loan Document, including, but without limiting to Clause Eighteen.

 

(c)          Any amendment to this Agreement or any other Loan Document in relation with the obligations, liabilities, or powers of the Administrative Agent, shall be previously consented to by the Administrative Agent.

 

TWENTY SIXTH. Improvidence. To the extent that the applicable law allows, the Borrower expressly and irrevocable waives to invoke and/or exercise any right that it may have in its favor because of unknown, extraordinary and/or unpredictable circumstances or events, that affect or may affect in any way the compliance of its obligations under this Agreement or any other Loan Documents.

 

TWENTY SEVENTH. Confidentiality. Each of the Administrative Agent and the Creditors agree to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates, and their respective directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that, the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b) to the extent requested by any regulatory or self-regulatory authority including any securities exchange; (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process; (d) to any other party from the ones intervening in this

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Agreement; (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder; (f) subject to an agreement containing provisions substantially the same as those of this Clause, to (i) any Assignee of or Participant in, or any prospective Assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterparty’s or prospective counterparty’s professional advisor) to any credit derivative transaction relating to obligations of the Company; (g) with the consent of the Company; or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Clause or (ii) becomes available to the Administrative Agent or any Creditor on a non-confidential basis from a source other than the Company. In addition, the Administrative Agent and the Creditors may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry, and service providers to the Administrative Agent and the Creditors in connection with the administration and management of this Agreement, the Commitments, and the Loan. For the purposes of this Clause, “Information” means all information sent by the Borrower relating to the Borrower and/or its Subsidiaries and/or its business, other than any such information that is available to the Administrative Agent or any Creditor on a non-confidential basis prior to disclosure by the Borrower; provided that, in the case of information received from the Company after the date hereof, such information shall be deemed to be confidential unless it is clearly identified in writing at the time of delivery as not confidential or it is apparent that such information is not confidential. Any Person required to maintain the confidentiality of Information as provided in this Clause shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

TWENTY EIGHTH. Counterparts. This Agreement may be signed in the number of counterparts that, by common agreement, the parties hereof determine, which will constitute one sole Agreement.

 

TWENTY NINTH. Headings. The parties agree that the headings to each of the Clauses of this Agreement are for reference purposes only and will not affect the meaning or interpretation of this Agreement.

 

THIRTIETH. Exhibits. The parties agree that the Exhibits are an integral part of this Agreement as if they were included hereof, and that this Agreement shall be interpreted taking into account the content of sad Exhibits.

 

[SIGNATURES ON A SEPARATE PAGE]

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

This Agreement is signed on June 10, 2013 in Mexico City, Mexico.

 

	
 
    	
THE BORROWER
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
GRUMA, S.A.B. DE C.V.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
/s/ Raul Cavazos Morales
    	
 
    
	
 
    	
By: Raul Cavazos Morales
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
/s/ Rodrigo Martinez Villarreal
    	
 
    
	
 
    	
By: Rodrigo Martinez Villarreal
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    

 

This page of signatures belongs to the loan agreement dated June 10, 2013, executed between GRUMA, S.A.B. de C.V., as the borrower, Banco Inbursa, S.A., Institución de Banca Múltiple Grupo Financiero Inbursa, as a Lead Arranging Agent, Creditor and Administrative Agent, the financial entities that are listed on Exhibit 1 of this Agreement, ad Creditors, Goldman Sachs & Co and Banco Santander (Mexico), S.A. Institución de Banca Múltiple, Grupo Financiero Santander Mexico and Arranging Agents.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

THE LEAD ARRANGER AGENT AND ADMINISTRATIVE AGENT

 

BANCO INBURSA, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE GRUPO FINANCIERO INBURSA

 

 

	
 
    	
/s/ Felipe Molina Bernal
    	
 
    
	
 
    	
By: Felipe Molina Bernal
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    

 

This page of signatures belongs to the loan agreement dated June 10, 2013, executed between GRUMA, S.A.B. de C.V., as the borrower, Banco Inbursa, S.A., Institución de Banca Múltiple Grupo Financiero Inbursa, as a Lead Arranging Agent, Creditor and Administrative Agent, the financial entities that are listed on Exhibit 1 of this Agreement, ad Creditors, Goldman Sachs & Co and Banco Santander (Mexico), S.A. Institución de Banca Múltiple, Grupo Financiero Santander Mexico and Arranging Agents.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

THE CREDITORS

 

BANCO INBURSA, S.A., INSTITUCION DE BANCA MULTIPLE GRUPO FINANCIERO INBURSA

 

 

	
 
    	
/s/ Felipe Molina Bernal
    	
 
    
	
 
    	
By: Felipe Molina Bernal
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    

 

This page of signatures belongs to the loan agreement dated June 10, 2013, executed between GRUMA, S.A.B. de C.V., as the borrower, Banco Inbursa, S.A., Institución de Banca Múltiple Grupo Financiero Inbursa, as a Lead Arranging Agent, Creditor and Administrative Agent, the financial entities that are listed on Exhibit 1 of this Agreement, ad Creditors, Goldman Sachs & Co and Banco Santander (Mexico), S.A. Institución de Banca Múltiple, Grupo Financiero Santander Mexico and Arranging Agents.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

THE CREDITORS

 

BANCO NACIONAL DE COMERCIO EXTERIOR, S.N.C., BANCA DE DESARROLLO

 

 

	
 
    	
/s/ Leonel Napoleón Vásquez Gómez
    	
 
    
	
 
    	
By: Leonel Napoleón Vásquez Gómez
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
/s/ Felipe Cárdenas Estrada
    	
 
    
	
 
    	
By: Felipe Cárdenas Estrada
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    

 

This page of signatures belongs to the loan agreement dated June 10, 2013, executed between GRUMA, S.A.B. de C.V., as the borrower, Banco Inbursa, S.A., Institución de Banca Múltiple Grupo Financiero Inbursa, as a Lead Arranging Agent, Creditor and Administrative Agent, the financial entities that are listed on Exhibit 1 of this Agreement, ad Creditors, Goldman Sachs & Co and Banco Santander (Mexico), S.A. Institución de Banca Múltiple, Grupo Financiero Santander Mexico and Arranging Agents.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

THE CREDITORS

 

HSBC MEXICO, S.A., INSTITUCION DE BANCA MULTIPLE, GRUPO FINANCIERO HSBC

 

 

	
 
    	
/s/ Victor Manuel Elizondo Arias
    	
 
    
	
 
    	
By: Victor Manuel Elizondo Arias
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
/s/ Cordelia González Flores
    	
 
    
	
 
    	
By: Cordelia González Flores
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    

 

This page of signatures belongs to the loan agreement dated June 10, 2013, executed between GRUMA, S.A.B. de C.V., as the borrower, Banco Inbursa, S.A., Institución de Banca Múltiple Grupo Financiero Inbursa, as a Lead Arranging Agent, Creditor and Administrative Agent, the financial entities that are listed on Exhibit 1 of this Agreement, ad Creditors, Goldman Sachs & Co and Banco Santander (Mexico), S.A. Institución de Banca Múltiple, Grupo Financiero Santander Mexico and Arranging Agents.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘1’’

List of Creditors

 

1.              Banco Inbursa, S.A., Institución de Banca Multiple, Grupo Financiero Inbursa.

2.              Banco Nacional de Comercio Exterior, S.N.C., Banca de Desarrollo.

3.              HSBC México, S.A., Institución de Banca Múltiple, Grupo Financiero HSBC.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘2’’

Commitments

 

	
Bank
    	
 
    	
Amount
    	
 
    	
Percentage of
   Participation
    	
 
    
	
Banco Inbursa,   S.A., Institución de Banca Multiple, Grupo Financiero Inbursa
    	
 
    	
$
    	
1,533,333,333.34
    	
 
    	
66.66
    	
%
    
	
Banco Nacional de   Comercio Exterior, S.N.C., Banca de Desarrollo
    	
 
    	
$
    	
383,333,333.33
    	
 
    	
16.67
    	
%
    
	
HSBC México,   S.A., Institución de Banca Múltiple, Grupo Financiero HSBC
    	
 
    	
$
    	
383,333,333.33
    	
 
    	
16.67
    	
%
    
	
Total
    	
 
    	
2,300,000,000.00
    	
 
    	
100
    	
%
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘3’’

Borrower’s Accounts

 

	
Bank:
    	
 
    	
Banco Inbursa, S.A., Institución de   Banca Multiple, Grupo Financiero Inbursa
    
	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
Gruma, S.A.B. de C.V.
    
	
 
    	
 
    	
 
    
	
Account   No:
    	
 
    	
50018760903
    
	
 
    	
 
    	
 
    
	
Clabe
    	
 
    	
036580500187609033
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘4’’

Hedging Politics

 

See Exhibit.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

	
International Corporate Policy
    	
Code:
    PDGIN04
    	
 
    
	

    	
Title
    	
 
    	
 
    
	
Risk Management
    	
Substitutes:
    1/SEP/2009
    	
Edition:
    002
    
	
 
    	
 

Validity Date:
    1/MARCH/2011
    	
 
    

 

Objective

 

The Company recognizes that there are certain inherent risks to its business operations.  The Company will therefore establish guidelines that, to the extent practicable, allow Gruma to efficiently manage the risks to which it is exposed.

 

Scope

 

This policy is applicable to all of Gruma’s business divisions.

 

Issuing Area

 

Risk Management Committee

 

Contents

 

I.                                        Policy

 

II.                                   Definitions

 

III.                              Guidelines

 

Appendix

 

	
Autorización:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
[illegible   signature]
    	
 
    	
 
    
	
[illegible signature]
    	
 
    	
C.P. Juan. A. Quiroga
    	
 
    	
[ illegible signature ]
    
	
Ing. Raul Pelaez Cano
    	
 
    	
Chief Financial and Strategic
    	
 
    	
Lic. Salvador Vargas Guajardo
    
	
Chief Corporate Officer
    	
 
    	
Planning Officer
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
Chief Legal Officer
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
[illegible signature]
    	
 
    	
[illegible signature]
    
	
Ing. Leonel Garza Ramírez
    	
 
    	
Ing. Homero Huerta M.
    
	
 
    	
 
    	
 
    
	
Chief Procurement Officer
    	
 
    	
Chief Administrative Officer
    
							

 

 2009 Risk Management Committeeã

 

1

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

I.                                        Policy

 

Establish a Risk Management Process which will allow Gruma to identify, and to the extent practicable, to anticipate and/or mitigate events that could prevent or jeopardize the realization of its strategic, financial and operational objectives.

 

II.                                   Definitions

 

Risk

 

The possibility that an event, either internal or external, could adversely affect the organization’s ability to execute its strategies and prevent the achievement of its objectives.

 

Risk Management

 

A logical and systematic method of identifying, analyzing, evaluating, treating and monitoring the risks associated with the organization’s business activities, thereby allowing the organization to minimize losses and maximize opportunities. Risk management involves both identifying opportunities and avoiding or mitigating losses.

 

Environmental Risks

 

Risks that arise as a result of external situations and can affect the viability of the company’s business model.

 

Financial Risks

 

Risks associated with market and economic variable, including interest rates, financial instruments, commodities, and foreign exchange rates.

 

Operational Risks

 

Risks that result from the day-to-day operations of the company.

 

Strategic Risks

 

Risks that arise from the implementation of the corporate strategy and might jeopardize the achievement of its long-term objectives, including but not limited to political risks.

 

Risk Tolerance

 

The level of risk considered acceptable to the organization, taking into account the achievement of its objectives.

 

RMC

 

The Risk Management Committee, which includes the following members:

 

a.                   Chief Corporate Officer

b.                   Chief Financial and Strategic Planning Officer

c.                    Chief Legal Officer

d.                   Chief Administrative Officer

e.                    Chief Procurement Officer

f.                     Chief Technology Officer

 

2

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

II.                                   Definitions, continuation

 

DRMC

 

Each DRMC will include the following members:

 

a.              Divisional Directors Team

b.              Corporate Director in charge of the specified area of business

 

III.                              Guidelines

 

·                  Gruma will adopt a risk management methodology which will allow it to identify risks, measure and quantify its level of exposure to such risks, and evaluate the appropriate strategies designed to mitigate the risks.  The objective is to achieve the best combination of risk and performance.  The divisional risk management committees will be responsible for the implementation of the risk management methodology within each division, as described in the appendix.

 

·                  The following categories will be established within the overall Risk Management structure:

 

a.       Environmental Risks: Risks associated with competition, customer needs, guarantee of supply, technological innovation, legal environment and financial markets.

 

b.       Operational Risks: Risks associated with day-to-day operations, including:

 

·                  Management style (leadership, performance incentives, and communications).

·                  Corporate governance (organizational culture, ethical behavior).

·                  Image (investor’s relationship, image qualification).

·                  Integrity (management fraud, employee fraud).

·                  Information Technologies (integrity, access, availability).

·                  Operation (client satisfaction, efficiency, capacity, care and environmental sustainability).

 

c.        Financial Risk: Risks associated with market and economic variable, including interest rates, financial instruments, commodities prices, and foreign exchange rates.

 

d.       Strategic Risks: Risks associated with the proper execution of the corporate strategy and might jeopardize the achievement of its long term objectives, including but not limited to:

 

·                  Entry to new products and/or markets

·                  Resource Allocation

·                  Merge and Acquisition transactions

·                  Reliability of information related to strategy design and execution

·                  Political

 

Continues...

 

3

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

III.                              Guidelines, continuation

 

·                  Gruma’s Board of Directors will supervise the application of the Risk Management Policy throughout the Organization.  The Board will  review and authorize the risk management policy. The Board must monitor the execution of appropriate risk-mitigation actions such that the most significant risks to the company are properly reviewed and analyzed by the Audit Committee.

 

·                  The Gruma CEO may designate and/or substitute RMC members.

 

·                  The RMC monitors all the risks which have the potential to hinder the organization’s strategic business objectives.  The Committee will use the risk management methodology and take the necessary actions to ensure the fulfillment of the organization’s objectives. In order to carry out its  responsibilities, the RMC has the following functions:

 

a.              Propose objectives, policies and procedures for risk management.

 

b.              Verify that the general objectives of the organization are widely known since they are the basis for any risk management policy.

 

c.               Authorize risks tolerance by division, business area and type of risk.

 

d.              Report to the Audit Committee, at a minimum on a quarterly basis, regarding:

 

·                  The assumed risk exposure and the negative impact to the company, consolidated, by division, by unit of business / area and by type of risk.

 

·                  The behavior of the tolerance to the established risks, bearing in mind the result of the audits and evaluations relative to the procedures of risk management.

 

e.               Authorize and implement institutional strategies to control and / or minimize the diverse risks facing the organization.  This task includes, for example, the authorization of interest rate hedging and other financial transactions.

 

f.                The RMC is responsible for ensuring that all Gruma’s different DRMC are verifying that the risks the company faces in its operations are being identified, evaluated and monitored.  The RMC should promote the integration of its risk management activities with the organization’s broader strategic planning process and make sure that the necessary mitigating elements are considered in the Divisional annual budget process. This monitoring activity should be performed through the year.

 

g.               The RMC shall act by a vote of a super majority of its members equal to five out of six of its members. In the absence of agreement by five out of six of the members of the RMC in respect of any matter, the CEO shall decide such matter and such decision by the CEO shall be bind over.

 

4

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

III.                              Guidelines, continuation

 

h.              Upon request by the RMC, each Divisional and functional areas will provide all risk strategies to RMC. The RMC will consolidate all risk strategies in the official budget presentations to the Board of Directors and Audit Committee.

 

·                      Each DRMC is responsible for identifying, evaluating and monitoring the risks the company faces in its operations, such as environmental risks, operational risks, financial risks and strategic risks.  The DRMC should promote the integration of its risk management activities with the organization’s broader strategic planning process and make sure that the necessary mitigating elements are considered in the Divisional annual budget process.  Each Divisional Risk Management Committee will be led by the most senior employee responsible for each division.  As necessary, each Committee will be able to seek input from the individuals in charge of risk evaluation, that is, each DRMC must determine the risk tolerance for its division and submit it to the RMC approval.

 

·                  The DRMC will designate the person(s) responsible(s) to apply the risk management methodology.  In other words, the person(s) who must identify, document, evaluate, and monitor the relevant risks, as well as of determining the related risk tolerance, which will be then presented for approval by the respective Committee.

 

·                  Internal Audit Department must conduct an objective evaluation of the integral risk management process through periodic reviews. Such periodic reviews should involve observing, evaluating and recommending actions designed to improve the decision-making process, which should be informed through the institutional communication channels to the corresponding RMC and DRMC.

 

·                       Mitigation Risk Instruments. The following  Mitigation Risk Instruments are permissible:

 

·                  Financial Derivative Instruments and Hedging Instruments

 

i.                       With respect to the use of derivatives, the use of derivative financial instruments and hedging instruments for speculative purposes or with the aim of obtaining profits based on changing market values is prohibited under all circumstances. Any derivative financial contracts entered into by the organization must be associated with a hedged item that is relevant to business activities, such as the purchase of inventories, heating oil, packaging material, fuel consumption (commodities), interest payments with a determined rate, foreign currency payments at a given exchange rate. The notional amounts cannot be higher than 100% of the operational needs of the hedge item, in a period not longer of 18 months.

 

Continues...

 

5

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

III.                              Guidelines, continuation

 

·                       Mitigation Risk Instruments. The following  Mitigation Risk Instruments are permissible:

 

·                  Financial Derivative Instruments, continuation

 

ii.                    Only the derivative financial instruments hedging alternatives presented by financial institutions, which are recognized on the financial ambit as honest an professionals, should be analyzed.

 

iii.                 The purchase of derivative financial instruments for hedging purposes is only allowed if such derivatives are used with the objective of mitigating any or several of the financial risks generated by a transaction or a group of transactions associated with a hedged item, such as those which are used to mitigate market risks.

 

iv.                To the extent practicable, derivative financial instruments should not be contracted with financial institutions that require margin calls.

 

v.                   All contracts for the purchase of derivative financial instruments must have the approval of Gruma’s Chief Legal Officer.

 

vi.                The derivative instruments must be used within the limits established by the Risk Management Committee.  The use of derivatives must be evaluated in conjunction with the additional risks posed by their use, including credit risks, liquidity risks and legal risks.  Derivatives must only be used when the proposed result outweighs the risks associated with their use.

 

vii.             The Mexican Financial Reporting Standards establish in the C-10 bulletin “Derivative Financial Instruments and of Hedging”, some documentary evidence conditions so that a financial instrument can be considered as hedging.  For the purpose of this policy these conditions do not apply, it is only necessary to demonstrate that the intention of the financial instrument is not speculative or entered into with the and solely to obtain profits based on the changes of its market value.

 

Continues...

 

6

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

III.                              Guidelines, continuation

 

·                       Mitigation Risk Instruments. The following  Mitigation Risk Instruments are permissible:

 

·                  Other Hedging Instruments

 

Gruma will establish the necessary loss prevention programs for its business operations and human element (safety). Within this program the following can be used:

 

·                       Operative Coverage

 

a.              Property Loss Prevention

b.              Property All Risk

c.               Malicious Product Tampering

d.              Crime

e.               Terrorism

 

·                       Third Parties Coverage

 

f.                General and Products Liability

g.               Directors and Officers Liability

h.              Automobile Liability

 

·                       Employee Benefits Coverage

 

i.                  Life insurance

j.                 Disability insurance

k.              Medical insurance

 

·                  Any modification to the present policy requires the prior approval of the Board of Directors based on the Audit Committee’s recommendation.

 

7

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Appendix

 

Risk Management Methodology

 

The company establishes a risk management methodology based on the norm AS/NZ 4360 which presents the following 7 components:

 

 

8

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘5’’

Note Template

 

NOTE

NOT TRANSFERABLE BY ENDORSEMENT

 

$[*]

 

FOR VALUE RECEIVED, the undersigned, Gruma, S.A.B. de C.V. (the ‘‘Borrower’’), by this Note unconditionally promises to pay to the order of [*] (the ‘‘Bank’’) the principal amount of $[*] ([*] Mexican Pesos [*]/100), payable on eight semiannual installments on the Principal Payment Date (as defined below) of the corresponding month in accordance with the following calendar of amortizations (each one, a ‘‘Principal Payment Date’’), unless the last Principal Payment Date, which will be on 10 June 2018 (the ‘‘Maturity Date’’)) and in the quantities that are listed below:

 

	
Principal Payment Date
    	
 
    	
Amortization
   Amount
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
[*]
    	
 
    	
$
    	
[*]
    	
 
    
	
Maturity Date
    	
 
    	
$
    	
[*]
    	
 
    

 

The Borrower also unconditionally promises to pay to the Bank interest on the unpaid principal amount of this Note, from the date hereof until the Maturity Date, at the annual Interest Rate (as defined below) that will be the same as the TIIE Rate (as defined below) applicable during each Interest Period (as defined below) plus the Applicable Margin (as defined below) (the ‘‘Interest Date’’). The interest shall be paid in arrears on the last day of the Interest Period; given that, the last interest payment date shall occur precisely on the Maturity Date.

 

Any outstanding principal amount and, to the extent permitted by the applicable law, interest not paid when due under this Note, shall bear overdue interest on the overdue and unpaid amount from the date in which said payment should have been made in its entirety, at a rate per annum equal to the sum of the Interest Rate applicable during each Interest Period on which the default occurs and is continuing multiplied by 1.5 (one point 5). Said overdue interest shall be payable on demand.

 

Ordinary and overdue interest hereunder shall be calculated on the basis of the actual number of days elapsed (including the first day but excluding the last day), divided by 360.

 

For the purposes of this Note, the following terms shall have the following meanings:

 

‘‘Administrative Agent’’ means Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa.

 

‘‘Applicable Margin’’ means 262.5 pbs (two hundred sixty-two point five base points (pbs)).

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

‘‘Business Day’’ means, any day on which commercial banks in Mexico City, Distrito Federal, México, carry out their operations and are not authorized to close. Notwithstanding the foregoing, for purposes of this Note, Saturdays, Sundays, and December 31 of every year won’t be considered as a Business Day.

 

‘‘Interest Payment Date’’ means the last day of each Interest Period.

 

‘‘Interest Period’’ means every quarterly period based on which the interest on the unpaid principal of this Note shall be calculated.

 

‘‘Mexico’’ means the United Mexican States.

 

 ‘‘TIIE Rate’’ means, for each Interest Period, the Tasa de Interés Interbancaria de Equilibrio within 91 (ninety one) days, published by the Mexican Central Bank (‘‘Banco Central de México’’) in the Official Federation Gazette (‘‘Diario Oficial de la Federación’’) on the first day of the corresponding Interest Period; provided that, in case that the first day of the Interest Period is not a Business Day, the TIIE Rate will be the one published on the immediate preceding Business Day to the starting date of such Interest Period or the closes Business Day.

 

All payments of principal and interest that the Borrower should make in accordance with this Note will be free of taxes, rights, contributions, retentions, deductions, charges or any other tax responsibility payable in accordance with the law, rules and other legal dispositions applicable in Mexico, with no setoff, in immediately available funds no later than 12:00 noon (Mexico City time) on the day that the payment is due, in pesos, legal currency in Mexico, to the benefit of the Bank, in bank account No. 50018760903, CLABE No. 036580500187609033, maintained by the Administrative Agent in Banco Inbursa Bancomer, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa. The Borrower agrees to reimburse upon demand, in the same manner and funds, all reasonable and documented costs and expenses incurred in connection with the enforcement of the Note (including, without limitation, all reasonable and documented legal fees and expenses).

 

If any tax, right, contribution, retention, charge, lien or any other tax responsible together with interest, charges, sanctions, fines or derived charges (‘‘Taxes’’) are applicable on the payments of principal, interests, commissions and any other payable amount in relation with this Note, the Borrower will pay the necessary additional sums to the corresponding tax authority, on the account of the holder of this, the amount of any of such Taxes, and will pay to the holder of this Note the additional amounts that are required to ensure that the Bank will receive the same amounts that they received, if those Taxes were not applicable. The foregoing will not be applicable in relation to the income tax or similar taxes payable by the holder of this Note over his income or total assets in accordance with the laws, rules and other legal dispositions in Mexico or any other jurisdiction of which it is a resident, is legally established in or has a permanent establishment in.

 

This Note shall be governed by and construed in accordance with the laws of Mexico.

 

Any legal action or proceeding relating to this Note could be brought in any federal court sitting in Mexico City, Distrito Federal; the undersigned and the holder of this Note waive the jurisdiction of any other courts.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

The Borrower hereby waives diligence, demand, protest, presentment, notice of dishonor or any other notice or demand whatsoever.

 

For purposes of article 128 of the General Law of Negotiable Instruments and Credit Transactions of  Mexico, the term  of presentment of this Note is hereby irrevocably extended for a period of six (6) months following the Maturity Date, provided that such extension will not prevent the presentment of this  Note prior to such date.

 

This Note consists of 3 (three) pages evidencing one instrument.

 

This Note is issued in the City of Monterrey, Nuevo Leon, Mexico, on [*] of [june] of 2013.

 

THE BORROWER

 

GRUMA, S.A.B. DE C.V.

 

	
 
    	
 
    	
 
    
	
By: [*]
    	
 
    	
By: [*]
    
	
Title: Attorney-in-fact
    	
 
    	
Title: Attorney-in-fact
    

 

Borrower’s Address:

Rio de la Plata No. 407 Oriente

Colonia del Valle, C.P. 66220

San Pedro Garza Garcia,

Estado de Nuevo Leon, Mexico.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘6’’

Compliance Certificate Template (Financial Information)

 

Responsible Officer Certificate

 

The undersigned, in my character as a Responsible Officer (as defined on the Loan Agreement) of Gruma, S.A.B. de C.V., (the ‘‘Borrower’’), in accordance with Clause Tenth, letter (a), numeral (iii) of the Loan Agreement dated 10 June 2013, entered into the Borrower, as borrower, Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa, as a arranging agent leader and administrative agent, and the financial entities listed in the Schedule 1 of said contract, as creditors (jointly, the ‘‘Creditors’’) ( the ‘‘Loan Agreement’’), I CERTIFY that:

 

(i)                                     [based on the Borrower and its Consolidated Subsidiaries’ determined and consolidated financial statements (as said term is defined on the Loan Agreement) to [*]] [the internal consolidated financial statements of the Borrower and its Consolidated Subsidiaries to [*]], delivered to the Agent in this act, the Borrower maintains (A) a Hedging Interest Index (as defined on the Loan Agreement) of [*] to [*], thus being in compliance with such financial indexes in accordance with what is stated on Clause Eleventh letters (i) and (j), respectively, of the Loan Agreement ; and

 

(ii)                                  that as of this date it has not occurred nor it is continued an Event of Default (as defined on the Loan Agreement).

 

IN WHITNESS WHEREOF, in my own handwriting, I hereby Certify on this [*] day of [june] of 2013.

 

 

	
 
    	
 
    
	
By:   [*]
    	
 
    
	
Title:   [*]
    	
 
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘7’’

Secretary Certificate Template

 

Secretary Certificate

 

GRUMA, S.A.B. DE C.V.

 

I, the undersigned, Mr. Salvador Vargas Guajardo, in my capacity as Secretary of the Board of Directors of Gruma, S.A.B. de C.V. (the ‘‘Company’’), in accordance with Clause Twelfth, letter (a), numeral (iii) of the Loan Agreement dated June 10 2013, entered into by the Company, as the borrower, Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa, as leader arranging agent and administrative agent, and the financial entities listed on Schedule 1 of said agreement, as creditors (the ‘‘Loan Agreement’’), hereby certify that:

 

1.              The capitalized terms and not defined in this document, will have those meanings set forth on the Loan Agreement.

 

2.              The undersigned has enough capacity and sufficient powers to subscribe and deliver this Certificate in representation of the Company.

 

3.              The following people are dully empowered and authorized to jointly, execute and subscribe the Loan Agreement, and the signatures that appear below are the true and authentic signatures of the corresponding attorneys-in-fact:

 

	
Name 
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
Mr. Juan Antonio Quiroga García
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Mr.   Raúl Cavazos Morales
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Mr.   Salvador Vargas Guajardo
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Mr.   Homero Huerta Moreno
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Mr.   Rodrigo Martinez Villarreal
    	
 
    	
 
    

 

4.              The Company has executed all necessary corporate actions and obtained all corresponding authorizations in relation to the transactions contemplated on the Loan Agreement. Particularly, the undersigned, in his character of Secretary of the Board of Directors of the Company, certifies that during the Company’s Board of Directors’ Meeting celebrated on April 24, 2013, it was resolved, among other matters, to authorize the Company to execute and subscribe the Loan Agreement, the Notes and other Financial Documents. Said resolutions are valid and enforceable, have not been modified, amended or revoked to this date, and are the only necessary actions and authorizations for the Company to subscribe and execute the Loan Agreement, the Financial Documents and any other document in relation to the same.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

5.              The approval, authorization, resignation or consent it is not required to, or registry before any Governmental Authority (including, without limitation, approval for exchange control), in relation with the signature, delivery and execution of the Loan Agreement or any other Financial Document by the Company.

 

IN WHITNESS WHEREOF, in my own handwriting sign this Certificate on this [*] day of [june] of 2013.

 

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
Mr. Salvador Vargas Guajardo
    
	
 
    	
 
    	
Secretary   of the Board of Directors
    
	
 
    	
 
    	
Gruma, S.A.B. de C.V.
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘8’’

Legal Opinion Template of the Borrower

 

[*] of [*] of 2013

 

Banco Inbursa, S.A., Institución de Banca Múltiple

Grupo Financiero Inbursa,

As Leader Arranging Agent and

Administrative Agent of the Loan Agreement
 mentioned further below

 

Dear Sirs:

 

I, Salvador Vargas Guajardo, in my character as the Borrower’s (as defined below) in-house counsel, make reference to the Loan Agreement dated June 10, 2013, for a total amount of $2,300,000,000.00 (two thousand three hundred million pesos, legal currency in the United Mexican States 00/100) (the ‘‘Loan Agreement’’), entered into by Gruma, S.A.B. de C.V., as the borrower (the ‘‘Borrower’’); Banco Inbursa, S.A., Institución de Banca Múltiple, as arranging leade agent and administrative agent (the ‘‘Administrative Agent’’) and the financial entities listed on Schedule 1 of said agreement (the ‘‘Creditors’’) and Goldman Sachs & Co. and Banco Santander (Mexico), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México, as arranging agents (the ‘‘Arranging Agents’’). This opinion is pursuant to Clause Twelfth, letter (a), subsection (vi)(A), of the Loan Agreement. The capitalized terms used in this document will have the same meaning set forth for them in the Loan Agreement, unless they are defined here in a different manner.

 

In rendering this opinion, I have reviewed originals or copies of the following documents:

 

(a)         a counterpart of the Loan Agreement;

 

(b)         the Note template attached as Exhibit ‘‘5’’ to the Loan Agreement;

 

(c)          the public deed described in Appendix ‘‘A’’ hereto, that contains the Borrower’s current articles of association;

 

(d)         the public deeds described in Appendix ‘‘B’’ hereto, that contain the Borrower’s current powers-of-attorney; and

 

(e)          those other documents and those laws, decrees, regulations and similar considered to be necessary to issue the opinions subject matter hereto.

 

The referred to documents in letters (a) and (b) above, in the following will be jointly referred to as the ‘‘Financial Documents’’.

 

To render this opinion, I have assumed, without carrying out an independent investigation or any verification, (i) the accuracy of all signatures (except for the signatures of the Borrower’s attorney-in-fact), (ii) the authenticity of all documents that were delivered to us as originals, as well as the fidelity of the original documents with the documents that we delivered to us as certifications or

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

copies, and (iii) the corresponding powers, as well as the due execution of the Financial Documents by the parties (except by the Borrower).

 

Based on the foregoing, I am of the following opinion:

 

1.              The Borrower is a corporation duly organized as a sociedad anónima bursátil de capital variable in accordance with the laws of the United Mexican States (‘‘Mexico’’), and it is fully empowered according to its company purpose to execute and subscribe the Financial Documents, and to assume the obligations that are established in them.

 

2.              The execution and subscription on the Borrower’s part of the Financial Documents and the compliance of every one of its obligations under them, has been duly authorized in accordance with the applicable legislation and its articles of association, and do not infringe (i) its valid articles of association to this date, (ii) any law or administrative or contractual provision, of any nature, that binds or affects it.

 

3.              Any two of the sirs Juan Antonio Quiroga García, Homero Huerta Moreno, Salvador Vargas Guajardo, Raúl Cavazos Morales, Rogelio Sánchez Martínez and Rodrigo Martínez Villarreal, acting in a joint manner, have sufficient powers to bind the Borrower in accordance with the Financial Documents.

 

4.              The Borrower does not require consent, authorization or registration of or before Governmental Authority or any third party for the execution and subscription of the Financial Documents or for the subscription of the Notes, for the validity and enforceability of the same or the compliance of its obligations in accordance with them.

 

5.              The Loan Agreement constitutes, and the Notes, once they have been subscribed in the terms on the Loan Agreement by any two of the individuals referred to in letter 3 above, acting jointly, as attorneys-in-fact of the Borrower, will constitute, legal and valid obligations of the Borrower, respectively, enforceable against him in accordance with its respective terms.

 

6.              All tax returns and reports of the Borrower and each of its Material Subsidiaries, that according to the applicable law must be filed with tax authorities, have been filed; and all taxes and other contributions in charge of the Borrower and each of its Material Subsidiaries, in respect of its income or assets, that must be made or withheld, have been made or withheld; except for (i) those that were contested in good faith through the adequate proceedings and for those that were established the necessary reserved in accordance with the NIIF, in its case; and (ii) those that if not filed or paid, individually or jointly, it could not be reasonably expected to have a Material Adverse Effect.

 

7.              The Borrower’s payment obligations in accordance with the Loan Agreement and the Note, once subscribed, constitute unsubordinated obligations of the Borrower and will have at all times at least the same preference of payment as its other non-guaranteed debts, current of future (with the exception of those obligations of payment that have preference in accordance with applicable legislation).

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

8.              None of the payments in favor of the Creditors (that qualify as a Mexican Financial Institution) according to the Loan Agreement and the Note, once subscribed, are subject to retentions or deductions according to Mexican tax legislation.

 

9.              The submission by the Borrower to the jurisdiction of the courts located in Mexico City according to the Loan Agreement and the Notes, are valid and enforceable in accordance with Mexican laws.

 

10.       Except as disclosed on Appendixes ‘‘A’’ and ‘‘B’’ of the Loan Agreement, as of the date hereof there are no pending actions, suits or proceedings, including environmental, tax and labor conflicts or any other disputes against the Borrower or any of its Material Subsidiaries before any court, Governmental Authority or arbitrator, that (a) could reasonably be expected to have a Material Adverse Effect, or (b) could affect the legality, validity or enforceability of the Financial Documents.

 

11.       The Borrower is in compliance of every contract to which it is a part of, or that is applicable to itself or its assets, except for those defaults, individually or jointly, could not be reasonably expected to cause a Material Adverse Effect, or that in any other way could affect the validity and enforceability of the Financial Documents.

 

12.       The Notes, once subscribed in the terms of the Loan Agreement will constitute a ‘‘título de crédito’’ according to the current Law of Credit Instruments and Operations (‘‘Ley General de Títulos y Operaciones de Crédito’’).

 

This opinion is subject to the following exceptions:

 

a.              The enforceability of the Financial Documents could be limited in case of a ‘‘concurso mercantil’’ and other statutes of general application related to or affecting the creditors’ rights;

 

b.              In accordance with Mexican law, labor obligations, claims from tax authorities for unpaid taxes, social security fees, housing fund or retirement savings system, they have preference by operation of law and will have preference over the Creditors.

 

c.               the Borrower’s obligations that have the purpose to bind itself in matters that by law are reserved to shareholders, or that require for its compliance force shareholders to vote or abstain from doing so or require that the Borrower votes or abstains from voting in any of its Subsidiaries, are not enforceable under Mexican law through compulsory compliance.

 

d.              The clauses in the Financial Documents that grant discretionary powers to the Creditors or to the Administrative Agent cannot be enforced in an inconsistent way with relevant facts nor are they above any requirement of a competent authority to generate sufficient evidence in respect of the basis of any determination. Also, under Mexican law, the Borrower will have the right to defend itself before any court from any determination made in use of said discretionary powers that pretend to be definitive and binding;

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

e.               The Notes include the caption ‘‘not negotiable’’ so that the Notes are not transferrable through endorsement and the exceptions had against the original holder of the Note including those exceptions that arise from the Financial Documents will be effective against the assignee of the Notes;

 

f.                To take the possession, enter, remove, sell, transfer or make any other use of the property or carry out any other similar proceeding in Mexico, the intervention of a Mexican judicial or administrative authority will be necessary, complying with the rules of hearing rights;

 

g.               According to Mexican law it is not possible to waive process rights. Any waiver from the Borrower in the Financial Documents to its right to defend itself against payment claims or any other defending right, to object the designation of jurisdiction or assist a trial could not be valid under Mexican law.

 

h.              The proceedings in favor of the Administrative Agent and/or the Creditors could be limited by statutes of limitations (‘‘prescripción’’), subject to exceptions, to set-off, or to a counterclaim. Under Mexican law, waiving statute of limitations dispositions and other applicable dispositions considered to be of public interest are not valid, binding nor enforceable.

 

i.                  The right to set-off established on Clause Sixteen of the Loan Agreement can only be enforced (i) over determined and payable amounts, and (ii) provided that a relationship between the Borrower and Creditor exists;

 

j.                 Any clause in the Financial Documents that establish that the invalidity or illegality of any part of it will not void the rest of said document, it could not be enforceable in Mexico in the case that said invalid or illegal part is an essential element of the corresponding Financial Document;

 

k.              According to Mexican law, the charge of interest on interest is not enforceable;

 

l.                  According to Mexican law, the enforceability of the compensatory clauses of the Financial Documents can be limited by the public interest;

 

m.          This legal opinion is limited to matters related to applicable current Mexican law as of the date hereof, thus I do not assume any obligation to update or review in the future.

 

This opinion is issued solely for your benefit and that of the Creditors and solely in connection to the Financial Documents, so that it may not be used by you or the Creditors for a different purpose that the one stated above, nor will it be possible to be quoted, circulated, presented or referred to in another public document nor delivered to any other person without my previous consent; provided that, it can be delivered to the legal advisors of the Administrative Agent, of the Creditors, and the assignees and participants of the Loan Agreement and/or the Notes under the terms of the Loan Agreement.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Sincerely,

 

 

	
 
    	
 
    	
 
    
	
 
    	
By: Mr. Salvador Vargas Guajardo
    	
 
    
	
 
    	
Title: In house Counsel
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Appendix
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Appendix ‘‘A’’
    	
 
    
	
 
    	
Bylaws
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Appendix ‘‘B’’
    	
 
    
	
 
    	
Powers of Attorney
    	
 
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘9’’

Responsible Official Certificate Template

 

I, the undersigned, in my character as Responsible Officer (according to said term as defined on the Loan Agreement) of Gruma, S.A.B. de C.V. (the ‘‘Borrower’’), in accordance with Clause Twelfth, letter (a), subsection (viii) of the Loan Agreement dated June 10, 2013, entered into by the Borrower, as borrower, Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa, as arranging leade agent and administrative agent, and the financial entities listed in Exhibit 1 of said contract, as creditors (jointly, the ‘‘Creditors’’), and Goldman Sachs & Co. and Banco Santander (Mexico) S.A., Institución de Banca Múltiple, Grupo Financiero Santander Mexico (the ‘‘Arranging Agents’’) (the ‘‘Loan Agreement’’), CERTIFIY that:

 

1.              Each and every one of the representations made by the Borrower in accordance with the Loan Agreement are true in every aspect as of the date hereof.

 

2.              No Event of Default (as defined in the Loan Agreement) has occurred is being continued.

 

3.              That from March 31, 2013, there has been no (A) fact or circumstance that has had or could reasonably be expected to have a Material Adverse Effect, and (B) a fact or circumstance of financial, political or economic nature in Mexico that has had or could reasonably be expected to have a Material Adverse Effect on the capacity of the Borrower to comply with its obligations under the Loan Agreement or any o the other Financial Documents.

 

IN WITNESS WHEREOF, in my own handwriting, I sign this Certificate in this day [*] of [June] of 2013.

 

 

	
 
    	
 
    	
 
    
	
 
    	
By:   [*]
    	
 
    
	
 
    	
Title:   [*]
    	
 
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit ‘‘10’’

Assignment and Acceptance Template

 

Assignment and Acceptance Agreement dated [*] of[*] of 20[*] (in the following, the ‘‘Agreement’’), entered into [Name of the Assigning Creditor], as assignor (in the following, the ‘‘Assigning Creditor’’)and (name of the new assignee creditor] as assignee (in the following, the ‘‘New Creditor’’), and with the appearance of [Gruma, S.A.B. de C.V., as borrower (in the following, ‘‘Gruma’’ or the ‘‘Borrower’’)](1) and Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa, as administrative agent (in the following, the ‘‘Administrative Agent’’) of the Loan Agreement (as defined below) in accordance with the following RECITALS, REPRESENTATIONS and CLAUSES.

 

RECITALS

 

I.                                        Dated June 10, 2013, the Borrower, the Administrative Agent and the financial institutions set forth on Exhibit 1 of the same, as creditors (jointly, the ‘‘Creditors’’), and Goldman Sachs & Co. and Banco Santander (Mexico), S.A., Institución de Banca Múltiple, Grupo Financiero Santander Mexico, as arranging agents (the ‘‘Arranging Agents’’) executed a Loan Agreement (as it is amended, added into or supplemented, from time to time, in the following, the ‘‘Loan Agreement’’), according to which the Creditors convened to grant Gruma a loan for an amount of up to $[*].00 ([*] pesos Mexican Currency 0/100).

 

REPRESENTATIONS

 

1.              The new Creditor represents:

 

(a)         That it is its will to acquire the rights of the Assigning Creditor in accordance to the Loan Agreement to the effect to be a ‘‘Creditor’’ in the terms of said agreement, and assume obligations and responsibilities of a ‘‘Creditor’’ in accordance with the Loan Agreement, through the execution of this Agreement to the effect of complying with what is stated in Clause Fifteen, letter (a)(D)(2) of the Loan Agreement.

 

(b)         That it is an Eligible Assignee

 

(c)          That it has received a copy of the Loan Agreement and financial information referred to in Clause Tenth, letters (a)(i) and (ii) of the Loan Agreement.

 

(d)         That it expressly recognizes the existence of the Administrative Agent and its the legal capacity to act as Administrative Agent in representation and benefit of the Creditors under the terms of the Loan Agreement.

 

Pursuant the foregoing, the Assigning Creditor and the New Creditor convene on the following:

 

CLAUSES

 

FIRST. Definitions. The terms capitalized used in this agreement, will have the same meaning set forth on the Loan Agreement unless they are defined differently in this Agreement.

 

SECOND. Assignment of Rights. In accordance with what is stated on Clause Tenth, letter (a)(D)(2) of the Loan Agreement, the Assigning Creditor assigns [all of his rights] [a participation of [*]% of the Loan

 

(1)  Prior to an Event of Default

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

derived from its Commitment equivalent to an amount of %[*] ([*] Pesos)] in accordance to the Loan Agreement to the New Creditor, who accepts in this act, in the terms of Articles 2019, 2020, 2032 and other applicable from the Federal Civil Code (“Codigo Civil Federal”) and its correlative articles from the civil codes of the rest Federal Entities of the Mexico and Mexico City.

 

THIRD. Recognition and Acceptance. Through the execution of this Agreement, as of this date, the New Creditor recognizes and accepts before the Borrower, the Administrative Agent and the Creditors that it will bear all the obligations, responsibilities and rights of a “Creditor” in accordance with what is established in the Loan Agreement and will be considered a ‘‘Creditor’’ in the terms of the Loan Agreement and its Exhibits and thus it undertakes to comply with all obligations established in charge of the Creditors under the Loan Agreement.

 

FOURTH. Effective Date. The effective date of this assignment will be on [*](the “Effective Date”). Once this Agreement has been signed by the Assigning Creditor and the New Creditor, the Assigning Creditor will deliver to the Administrative Agent and the Creditor so these will sign of conformity, being such case, and once signed by all parties it will take effect on the Effective Date.

 

FIFTH. Note Substitution. [The Assigning Creditor shall deliver to the New Creditor the Note that evidences the Loan deriving from the Credit Object of this assignment, duly assigned in favor of the New Creditor, who at the same time could instruct the Administrative Agent, so he requests and arranges the substitution of said Note with the Creditor in favor of the New  Assignor](2) [The Assigning Creditor shall deliver to the Administrative Agent the Note that derives from the Loan object of this Assignment so the Administrative Agent requests from the Borrower the issuance of the new note(s) (as the case may be) that substitute the Note as to reflecting the assignment matter of this Agreement](3)

 

SIXTH. No Novation. The execution of this Agreement does not constitute novation, payment, early payment, compliance with or extinction of any of the Borrower ́s obligations in accordance with the Loan Agreement or the Notes, including its exhibits, appendixes and amendments.

 

SEVENTH. Governing Law. This Agreement shall be governed by, and construed in accordance with Mexican laws.

 

EIGHT. Submission to Jurisdiction. In case of conflict in the interpretation and compliance with this Agreement, the parties submit to the jurisdiction of the courts of Mexico City, Distrito Federal, waiving to the jurisdiction of any other court that corresponds to them because of their current or future domiciles or any other cause.

 

This Agreement is signed in Mexico City, on the date stated in the foreword.

 

THE ASSIGNING CREDITOR
 [*]

 

 

	
 
    	
 
    	
 
    
	
By: [*]
    	
 
    	
By:   [*]
    

 

(2)  In case of a Total Assignment

(3)  In case of a Partial Assignment

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

 

	
Title: Attorney-in-fact
    	
 
    	
Title:   Attorney-in-fact
    

 

THE NEW CREDITOR
 [*]

 

 

	
 
    	
 
    	
 
    
	
By: [*]
    	
 
    	
By:   [*]
    
	
Title: Attorney-in-fact
    	
 
    	
Title:   Attorney-in-fact
    

 

 

Consented to and Accepted on [*] of [*] of 20[*] by:

 

THE ADMINISTRATIVE AGENT

 

BANCO INBURSA, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE, GRUPO FINANCIERO INBURSA

 

 

	
 
    	
 
    	
 
    
	
By: [*]
    	
 
    	
By:   [*]
    
	
Title: Attorney-in-fact
    	
 
    	
Title:   Attorney-in-fact
    

 

 

Consented to and Accepted on [*] of [*] of 20[*] by:

 

THE BORROWER

 

GRUMA, S.A.B. DE C.V.

 

 

	
 
    	
 
    	
 
    
	
By: [*]
    	
 
    	
By:   [*]
    
	
Title: Attorney-in-fact
    	
 
    	
Title:   Attorney-in-fact
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Exhibit “11”

Authorization Letter of Credit Information Template

 

Authorization Letter to request Credit Reports

Legal Entity

 

By this means, the undersigned, on behalf and in representation of Gruma, S.A.B. de C.V. (the “Company”), expressly manifests that it is knowledge of my client that the Credit Reporting Companies are intended to provide credit information services on the operations made by financial institutions with natural persons and/or legal entities, for which in this act I expressly authorize Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa and [name of other Creditors] (jointly, the ‘‘Banks’’), so each one of them, through its empowered representatives, carries out, at any moment, investigations over the credit behavior of the Company represented in the Credit Reporting Companies (Sociedades de Información Crediticia) as deemed convenient.

 

Also, I declare on behalf and in representation of the Company that it fully knows the nature and scope of the information that will be requested, of the use the Banks will give to such information and that the Banks may make periodic consults of its credit history during the time it maintains a legal relation with my client in accordance to certain Loan Agreement dated June 10, 2013, celebrated between the Company, as borrower, and the Banks as Creditors.

 

Under oath, I state to be a legal representative of the Company and that the powers of attorney which I hold me have not been revoked or limited in any way.

 

Name of the Company: Gruma, S.A.B. de C.V.

 

Federal Tax Registry (Registro Federal de Contribuyentes):

Address:

Telephone(s):

Date in which the consult is authorized:

 

I hereby state on behalf and in representation of my client, that the Company does not reserve any right and/or legal action and/or any other nature in relation to this authorization.

 

Also, I state that the Company recognizes and accepts that this document shall stay under property of the Banks and/or the Credit Reporting Company (Sociedades de Información Crediticia) that is consulted for purposes of control and compliance with article 28 of the Law to Regulate Credit Reporting Companies (Ley para Regular a las Sociedades de Información Crediticia).

 

GRUMA, S.A.B. DE C.V.

 

 

	
 
    	
 
    	
 
    
	
 
    	
By: [Name of the Legal Representative]
    	
 
    
	
 
    	
Title: Attorney-at-Law
    	
 
    

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Appendix “A”

 

List of Litigation of the Borrower and Material Subsidiaries

 

GRUMA Corporation

 

Cox v. Gruma Corporation

 

Approximately on December 21, 2013, a consumer presented a supposed collective suit against Gruma Corporation, alleging that Mission corn chips should not be labeled as “All Natural” if they contain certain non-natural ingredients. The plaintiff claims compensatory damages and loss profit, including the payment of legal fees. Gruma Corporation thinks that the claims have no fundamental basis and presented a request to dismiss the Lawsuit. In response to the request to dismiss the Lawsuit, the plaintiff presented a First Modified Lawsuit, Gruma Corpotation presented a request to dismiss said First Modified Lawsuit on April 10, 2013, and a hearing will take place on June 11, 2013 to solve Gruma’s request. We pretend to vigorously defend ourselves from this suit. Gruma thinks that the outcome of this proceeding will not have a material adverse effect on its financial position, results of operations or cash flows.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Appendix “B”

Environmental Matters List

 

·                  None

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Appendix “C”

Borrower’s Subsidiaries List

 

	
Company Name
    	
 
    	
Place of Incorporation
    	
 
    	
Equity Interest
    	
 
    	
Controlled by
    
	
Grupo Industrial Maseca, S.A.B. de C.V.
    	
 
    	
Nuevo Leon, Mexico
    	
 
    	
83
    	
%
    	
GRUMA, S.A.B. de C.V.
    
	
Gruma Corporation
    	
 
    	
Nevada, USA
    	
 
    	
100
    	
%
    	
GRUMA, S.A.B. de C.V.
    
	
Azteca Milling, L.P.
    	
 
    	
Texas, USA
    	
 
    	
100
    	
%
    	
GRUMA   Holding, Inc. And Valley Holding, Inc.(1)
    
	
Compañía Nacional Almacenadora, S.A. de C.V.
    	
 
    	
Nuevo Leon, Mexico
    	
 
    	
100
    	
%(2)
    	
Grupo Industrial Maseca, S.A.B. de C.V.
    

 

(1)         Gruma Corporation is holder of 100% of equity on GRUMA Holding, Inc. and Valley Holding, Inc.

 

(2)         Grupo Industrial Maseca, S.A.B. de C.V. is holder of all, but one, of the shares of share capital of Compañía Nacional Almacenadora, S.A.B. de C.V.

 

 

TRANSLATION FOR INFORMATION PURPOSES ONLY

 

Appendix ‘‘D’’

List of Agreement that Limit the Distribution of Dividends

 

A)           GRUMA Corporation

 

Syndicated, Amended and Re-expressed Loan Agreement dated June 20, 2013, executed between GRUMA Corporation, Bank of America, N.A. and several banks part of the same.Exhibit 10.1

 

FIFTH AMENDED AND RESTATED 
 STOCKHOLDERS’ AGREEMENT

 

THIS FIFTH AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT (this “Agreement”), dated as of the 24th day of April, 2014 (the “Agreement Date”), is entered into by and among Radius Health, Inc., a Delaware corporation (the “Corporation”), and each of the stockholders of the Corporation listed on Schedule 1 hereto and/or Schedule 2 hereto (hereinafter referred to collectively as the “Stockholders”).

 

WITNESSETH:

 

WHEREAS, the Corporation and the Stockholders are parties to a Fourth Amended and Restated Stockholders’ Agreement, dated February 14, 2014 (as amended, the “Prior Agreement”), which the requisite Stockholders desire to amend and restate in its entirety as set forth herein;

 

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and undertakings of the Corporation and the Stockholders, the parties hereto do hereby agree as follows:

 

SECTION 1.  Definitions. As used herein, the following terms shall have the following respective meanings:

 

Board means the Board of Directors of the Corporation.

 

Commission means the U.S. Securities and Exchange Commission.

 

Common Stock means shares of the Corporation’s Common Stock, par value $.0001 per share.

 

Demand Notice shall have the meaning set forth in Section 3.4(a) hereof.

 

Effective Time means immediately prior to the listing of the Common Stock on a national securities exchange.

 

Exchange Act means the Securities Exchange Act of 1934, as amended.

 

Expiration Date means June 30, 2017.

 

FINRA means the Financial Industry Regulatory Authority.

 

Group means as to any Stockholder that is a corporation or other entity, any and all of the venture capital limited partnerships or corporations now existing or hereafter formed that are affiliated with or under common control with one or more of the controlling stockholders of such Stockholder and any predecessor or successor thereto.

 

Holder means any holder of Registrable Securities who is a party to this Agreement.

 

 

Immediate Family Member means a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, of a natural person referred to herein.

 

Initiating Holders means, collectively, Holders who properly initiate a registration request under this Agreement.

 

Investors means the Persons listed on Schedule 2 hereto, severally, but not jointly and severally.

 

Other Shares shall have the meaning set forth in Section 3.6(b) hereof.

 

Oxford/Saints Group means (i) Oxford Bioscience Partners IV L.P., (ii) mRNA Fund II L.P., (iii) OBP IV — Holdings LLC, (iv) mRNA II — Holdings LLC, (v) Saints Capital VI, L.P., (vi) any other venture capital limited partnership now existing or hereafter formed which is affiliated with or under common control with the foregoing or one or more general partners of the foregoing and (vii) any successors or assigns of the foregoing.

 

Person (whether or not capitalized) means an individual, corporation, partnership, limited partnership, limited liability company, syndicate, trust, association or other entity.

 

Preferred Stock means, collectively, shares of the Corporation’s Series B-2 Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series B Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-1 Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-2 Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-3 Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-4 Convertible Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-5 Convertible Preferred Stock, par value $.0001 per share, and shares of the Corporation’s Series A-6 Convertible Preferred Stock, par value $.0001 per share.

 

Preferred Stockholders means, collectively, the holders of the Preferred Stock.

 

Registrable Securities means (i) the Common Stock issued or issuable upon the conversion of the Preferred Stock, (ii) the Common Stock issued or issuable upon exercise of the warrants issued pursuant to the Series B Convertible Preferred Stock and Warrant Purchase Agreement, dated April 23, 2013, by and among the Corporation and the Series B Stockholders named therein, as amended, and the warrants issued pursuant to the Series B-2 Convertible Preferred Stock and Warrant Purchase Agreement, dated February 14, 2014, by and among the Corporation and the Series B-2 Stockholders named therein, as amended, (iii) any Common Stock, or any Common Stock issued or issuable (directly or indirectly) upon conversion and/or exercise of any other securities of the Corporation, acquired by the Investors or any member of an Investor’s Group after the date hereof, (iv) any Common Stock issued as (or issuable upon conversion or exercise of any warrant, right or other security that is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares referenced in clause (i) above or; excluding in all cases, however, any Registrable Securities sold by a Person in a transaction in which the 

 

2

 

applicable rights under this Agreement are not assigned pursuant to Section 5, and excluding any shares for which registration rights have terminated pursuant to Section 3.13.

 

Registrable Senior Securities means the Registrable Securities issued or issuable upon conversion of, or in respect of, the Senior Preferred Stock.

 

Restricted Stock means all shares of capital stock of the Corporation, including (i) all shares of Common Stock, (ii) all shares of Preferred Stock, (iii) all shares of capital stock of the Corporation into which such shares may be converted or for which they may be exchanged or exercised and (iv) all other shares of capital stock issued or issuable by way of stock splits, stock dividends, stock combinations, recapitalizations or like occurrences on such shares.

 

Rule 145 means Rule 145 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

 

Securities Act means the Securities Act of 1933, as amended.

 

Selling Expenses means all underwriting discounts, selling commissions, and stock transfer taxes applicable to the sale of Registrable Securities, and fees and disbursements of counsel for any Holder.

 

Senior Preferred Stock means shares of the Corporation’s Series B-2 Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series B Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-1 Convertible Preferred Stock, par value $.0001 per share, shares of the Corporation’s Series A-2 Convertible Preferred Stock, par value $.0001 per share, and shares of the Corporation’s Series A-3 Convertible Preferred Stock, par value $.0001 per share.

 

Stockholders shall have the meaning set forth in the first paragraph hereof.

 

Transfer shall include any disposition of any Restricted Stock or of any interest therein which would constitute a sale thereof within the meaning of the Securities Act.

 

SECTION 2.  Filing of Reports Under the Exchange Act.  For so long as the Common Stock is registered under the Exchange Act, the Corporation shall comply with all reporting requirements of the Exchange Act and shall comply with all other public information reporting requirements of the Commission as a condition to the availability of an exemption from the Securities Act for the sale of any of the Registrable Securities (including any such exemption pursuant to Rule 144 thereof, as amended from time to time, or any successor rule thereto or otherwise). The Corporation shall cooperate with each Holder in supplying such information as may be necessary for such holder to complete and file any information reporting forms presently or hereafter required by the Commission as a condition to the availability of an exemption from the Securities Act (under Rule 144 thereof or otherwise) for the sale of any Registrable Securities.

 

3

 

 

SECTION 3.  Transfer of Securities.

 

3.1                               Restriction on Transfer.  The Restricted Stock shall not be transferable, except upon the conditions specified in this Section 3, which conditions are intended solely to ensure compliance with the provisions of the Securities Act in respect of the Transfer thereof.  In addition, no Restricted Stock shall be transferred unless, as conditions precedent to such transfer, the transferee thereof agrees in writing to be bound by the obligations of the transferring Stockholder hereunder.

 

3.2                               Restrictive Legend.  Each certificate evidencing any Restricted Stock and each certificate evidencing any such securities issued to subsequent transferees of any Restricted Stock shall (unless otherwise permitted by the provisions of Sections 3.3 or 3.10 hereof) be stamped or otherwise imprinted with a legend in substantially the following form:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAW. THE SECURITIES MAY NOT BE PLEDGED, HYPOTHECATED, SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAW OR AN EXEMPTION THEREFROM UNDER SUCH ACT OR LAW.

 

3.3                               Notice of Transfer.  By acceptance of any Restricted Stock, the holder thereof agrees to give prior written notice to the Corporation of such holder’s intention to effect any Transfer and to comply in all other respects with the provisions of this Section 3.3. Each such notice shall describe the manner and circumstances of the proposed Transfer and shall be accompanied by: (a) the written opinion of counsel for the holder of such Restricted Stock or, at such holder’s option, a representation letter of such holder, addressed to the Corporation (which opinion and counsel, or representation letter, as the case may be, shall be reasonably acceptable to the Corporation), as to whether, in the case of a written opinion, in the opinion of such counsel such proposed Transfer involves a transaction requiring registration of such Restricted Stock under the Securities Act and applicable state securities laws or an exemption thereunder is available, or, in the case of a representation letter, such letter sets forth a factual basis for concluding that such proposed transfer involves a transaction requiring registration of such Restricted Stock under the Securities Act and applicable state securities laws or that an exemption thereunder is available, or (b) if such registration is required and if the provisions of Section 3.4 hereof are applicable, a written request addressed to the Corporation by the holder of such Restricted Stock, describing in detail the proposed method of disposition and requesting the Corporation to effect the registration of such Registrable Securities pursuant to the terms and provisions of Section 3.4 hereof; provided, however, that (y) in the case of a Transfer by a holder to a member of such holder’s Group, no such opinion of counsel or representation letter of the holder shall be necessary, provided that the transferee agrees in writing to be subject to Sections 3.1, 3.2, 3.3 and 3.10 hereof to the same extent as if such transferee were originally a signatory to this Agreement, and (z) in the case of any holder of Restricted Stock that is a partnership, no such opinion of counsel or representation letter of the holder shall be necessary for a Transfer by

 

4

 

such holder to a partner of such holder, or a retired partner of such holder who retires after the date hereof, or the estate of any such partner or retired partner if, with respect to such Transfer by a partnership, (i) such Transfer is made in accordance with the partnership agreement of such partnership, and (ii) the transferee agrees in writing to be subject to the terms of Sections 3.1, 3.2, 3.3 and 3.10 hereof to the same extent as if such transferee were originally a signatory to this Agreement. If in an opinion of counsel or as reasonably concluded from the facts set forth in the representation letter of the holder (which opinion and counsel or representation letter, as the case may be, shall be reasonably acceptable to the Corporation), the proposed Transfer may be effected without registration under the Securities Act and any applicable state securities laws or “blue sky” laws, then the holder of Restricted Stock shall thereupon be entitled to effect such Transfer in accordance with the terms of the notice delivered by it to the Corporation. Each certificate or other instrument evidencing the securities issued upon such Transfer (and each certificate or other instrument evidencing any such securities not Transferred) shall bear the legend set forth in Section 3.2 hereof unless: (a) in such opinion of such counsel or as can be concluded from the representation letter of such holder (which opinion and counsel or representation letter shall be reasonably acceptable to the Corporation) the registration of future Transfers is not required by the applicable provisions of the Securities Act and state securities laws, or (b) the Corporation shall have waived the requirement of such legend; provided, however, that such legend shall not be required on any certificate or other instrument evidencing the securities issued upon such Transfer in the event such transfer shall be made in compliance with the requirements of Rule 144 (as amended from time to time or any similar or successor rule) promulgated under the Securities Act. The holder of Restricted Stock shall not effect any Transfer until such opinion of counsel or representation letter of such holder has been given to and accepted by the Corporation (unless waived by the Corporation) or, if applicable, until registration of the Registrable Securities involved in the above-mentioned request has become effective under the Securities Act. In the event that an opinion of counsel is required by the registrar or transfer agent of the Corporation to effect a transfer of Restricted Stock in the future, the Corporation shall seek and obtain such opinion from its counsel, and the holder of such Restricted Stock shall provide such reasonable assistance as is requested by the Corporation (other than the furnishing of an opinion of counsel) to satisfy the requirements of the registrar or transfer agent to effectuate such transfer.  Notwithstanding anything to the contrary herein, the provisions of this Section 3.3 and of Sections 3.1 and 3.2 shall not apply, and shall be deemed of no force or effect, with respect to shares of capital stock of the Corporation that are subject to a re-sale registration statement under the Securities Act, provided that such registration statement has been declared, and continues to remain, effective by the Commission.

 

3.4                       Registration Rights.

 

(a)                                 Form S-1 Demand.  If at any time after 180 days after the Effective Time, the Corporation receives a request from Holders of a majority of the Registrable Securities then outstanding that the Corporation file a Form S-1 registration statement with respect to at least thirty percent (30%) of the Registrable Securities then outstanding, then the Corporation shall (i) within 20 days after the date such request is given, give notice thereof (the “Demand Notice”) to all Holders other than the Initiating Holders; and (ii) as soon as practicable, and in any event within 60 days after the date such request is given by the Initiating Holders, file a Form S-1 registration statement under the Securities Act covering all Registrable Securities that the Initiating Holders requested to be registered and any additional Registrable Securities

 

5

 

requested to be included in such registration by any other Holders, as specified by notice given by each such Holder to the Corporation within 20 days of the date the Demand Notice is given, and in each case, subject to the limitations of Sections 3.4(c), 3.4(f) and 3.6.

 

(b)                                 Form S-3 Demand.  If at any time when it is eligible to use a Form S-3 registration statement, the Corporation receives a request from Holders of at least ten percent (10%) of the Registrable Securities then outstanding that the Corporation file a Form S-3 registration statement with respect to outstanding Registrable Securities of such Holders having an anticipated aggregate offering price, net of Selling Expenses, of at least $10.0 million, then the Corporation shall (i) within 10 days after the date such request is given, give a Demand Notice to all Holders other than the Initiating Holders; and (ii) as soon as practicable, and in any event within 45 days after the date such request is given by the Initiating Holders, file a Form S-3 registration statement under the Securities Act covering all Registrable Securities requested to be included in such registration by any other Holders, as specified by notice given by each such Holder to the Corporation within 20 days of the date the Demand Notice is given, and in each case, subject to the limitations of Sections 3.4(c), 3.4(f) and 3.6.

 

(c)                                  Notwithstanding the foregoing obligations, if the Corporation furnishes to Holders requesting a registration pursuant to this Section 3.4 a certificate signed by the Corporation’s chief executive officer stating that in the good faith judgment of the Board it would be materially detrimental to the Corporation and its stockholders for such registration statement to be filed and it is therefore necessary to defer the filing of such registration statement, then the Corporation shall have the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for a period of not more than 90 days after the request of the Initiating Holders is given; provided, however, that the Corporation may not invoke this right more than twice in any 12-month period.

 

(d)                                 The Corporation shall not be obligated to effect, or to take any action to effect, any registration pursuant to Section 3.4(a) (i) after the Corporation has effected two registrations pursuant to Section 3.4(a); or (ii) if the Initiating Holders propose to dispose of shares of Registrable Securities that may be immediately registered on Form S-3 pursuant to a request made pursuant to Section 3.4(b).  The Corporation shall not be obligated to effect, or to take any action to effect, any registration pursuant to Section 3.4(b) (i) during the period that is 30 days before the Corporation’s good faith estimate of the date of filing of, and ending on a date that is 90 days after the effective date of, a Corporation-initiated registration, provided, that the Corporation is actively employing in good faith commercially reasonable efforts to cause such registration statement to become effective; or (ii) if the Corporation has effected two registrations pursuant to Section 3.4(b) during the 12-month period immediately preceding the date of such request.  A registration shall not be counted as “effected” for purposes of this Section 3.4(d) until such time as the applicable registration statement has been declared effective by the Commission, unless the Initiating Holders withdraw their request for such registration, elect not to pay the registration expenses therefor, and forfeit their right to one demand registration statement pursuant to Section 3.4(a), in which case such withdrawn registration statement shall be counted as “effected” for purposes of this Section 3.4(d).

 

6

 

(e)                                  Existing Registration Statement.  The Corporation shall prepare and file with the Commission such amendments and supplements to the Corporation’s Registration Statement on Form S-1 (Reg. No. 333-175091) and the prospectus used in connection therewith as may be requested by the Holders of a majority of the Registrable Senior Securities and necessary to keep such registration statement effective until the earlier of (i) the sale of all Registrable Securities covered thereby or (ii) such time as the Registrable Securities registered on such registration statement are included in another registration statement covering the sale of such Registrable Securities, and to comply with the provisions of the Securities Act with respect to the sale or other disposition of all Registrable Securities covered by such registration statement.

 

(f)                                   The Corporation shall not be required to include in any registration statement an amount of securities that would exceed the maximum number of shares that can be included therein in accordance with the Securities Act and the rules and regulations promulgated thereunder.  In the event that not all Registrable Securities that Holders desire to include in a registration statement can be included in any one registration statement, then the Registrable Securities to be included shall be allocated among Holders on a pro rata basis based on the total number of Registrable Securities held by all Holders that have not been included in a registration statement.

 

3.5                       Piggyback Registration.

 

(a)                                 Each time that the Corporation proposes for any reason to register any of its securities under the Securities Act, other than (i) a registration relating to the sale of securities to employees of the Corporation or a subsidiary pursuant to a stock option, stock purchase or similar plan; (ii) a registration relating to a Rule 145 transaction; (iii) a registration on any form that does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Registrable Securities; (iv) a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered; or (v) under the Registration Statement on Form S-1 (Reg. No. 333-194150) or any registration statement filed pursuant to Rule 462(b) under the Securities Act in connection therewith, the Corporation shall promptly give written notice of such proposed registration to all Holders, which notice shall also constitute an offer to such Holders to request inclusion of any Registrable Securities in the proposed registration.

 

(b)                                 Each Holder shall have 30 days from the receipt of such notice to deliver to the Corporation a written request specifying the number of Registrable Securities such Holder intends to sell and the Holder’s intended method of disposition.

 

(c)                                  In the event that the proposed registration by the Corporation is, in whole or in part, an underwritten public offering of securities of the Corporation, any request under Section 3.5(b) may specify that the Registrable Securities be included in the underwriting (i) on the same terms and conditions as the shares of Common Stock, if any, otherwise being sold through underwriters under such registration, or (ii) on terms and conditions comparable to those normally applicable to offerings of common stock in reasonably similar circumstances in

 

7

 

the event that no Common Stock other than Registrable Securities are being sold through underwriters under such registration.

 

(d)                                 Upon receipt of a written request pursuant to Section 3.5(b), the Corporation shall promptly use its best efforts to cause all such Registrable Securities to be registered under the Securities Act, to the extent required to permit sale or disposition as set forth in the written request.

 

3.6                       Underwriting Requirements.

 

(a)                                 If, pursuant to Section 3.4, the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Corporation as a part of their request made pursuant to Section 3.4, and the Corporation shall include such information in the Demand Notice.  The underwriter(s) will be selected by the Corporation and shall be reasonably acceptable to a majority in interest of the Initiating Holders.  In such event, the right of any Holder to include such Holder’s Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein.  All Holders proposing to distribute their securities through such underwriting shall (together with the Corporation) enter into an underwriting agreement in customary form with the underwriter(s) selected for such underwriting.  Notwithstanding any other provision of this Section 3.6, if the managing underwriters advise the Initiating Holders in writing that marketing factors require a limitation on the number of shares to be underwritten, then the Initiating Holders shall so advise all Holders of Registrable Securities that otherwise would be underwritten pursuant hereto, and the number of Registrable Securities that may be included in the underwriting shall be allocated among such Holders of Registrable Securities, including the Initiating Holders, in proportion (as nearly as practicable) to the number of Registrable Securities owned by each Holder or in such other proportion as shall mutually be agreed to by all such selling Holders; provided, however, that the number of Registrable Securities held by the Holders to be included in such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting.

 

(b)                                 In connection with any offering involving an underwriting of shares of the Corporation’s capital stock pursuant to Section 3.5, the Corporation shall not be required to include any of the Holders’ Registrable Securities in such underwriting unless the Holders accept the terms of the underwriting as agreed upon between the Corporation and its underwriters, and then only in such quantity as the underwriters in their sole discretion determine will not jeopardize the success of the offering by the Corporation.  If the managing underwriter(s) of any proposed registration under Section 3.5 determines and advises in writing that the inclusion of all Registrable Securities proposed to be included in the underwritten public offering, together with any other Common Stock proposed to be included therein by holders other than the Holders (such other shares hereinafter collectively referred to as the “Other Shares”) would interfere with the successful marketing of the Corporation’s securities, then the total number of such securities proposed to be included in such underwritten public offering shall be reduced, (i) first by the shares requested to be included in such registration by the holders of Other Shares, (ii) second, if necessary, by all Registrable Securities which are not Registrable Senior Securities and (iii) third, if necessary, so that (A) one-half (1/2) of the securities to be

 

8

 

included consist of the securities proposed to be issued by the Corporation, and (B) one-half (1/2) of the securities to be included consist of the Registrable Senior Securities proposed to be included in such registration by the holders thereof, allocated among such Holders on a pro rata basis calculated based upon the number of Registrable Senior Securities sought to be registered by each such holder; provided, that the aggregate number of securities proposed to be included in such registration by the holders of Registrable Senior Securities shall only be reduced hereunder if and to the extent that such securities exceed twenty-five percent (25%) of the aggregate number of securities included in such registration. The shares of Common Stock that are excluded from the underwritten public offering pursuant to the preceding sentence shall be withheld from the market by the holders thereof for a period, not to exceed 90 days from the closing of such underwritten public offering, that the managing underwriter reasonably determines as necessary in order to effect such underwritten public offering.  For purposes of the provision in this Section 3.6(b) concerning apportionment, for any selling Holder that is a partnership, limited liability company, or corporation, the partners, members, retired partners, retired members, stockholders, and affiliates of such Holder, or the estates and Immediate Family Members of any such partners, retired partners, members, and retired members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single “selling Holder,” and any pro rata reduction with respect to such “selling Holder” shall be based upon the aggregate number of Registrable Securities owned by all Persons included in such “selling Holder,” as defined in this sentence.

 

(c)                                  For purposes of Section 3.4, a registration shall not be counted as “effected” if, as a result of an exercise of the underwriter’s cutback provisions in Section 3.6(a) or (b), fewer than fifty percent (50%) of the total number of Registrable Senior Securities that Holders have requested to be included in such registration statement are actually included.

 

3.7                       Preparation and Filing.  If and whenever the Corporation is under an obligation pursuant to the provisions of Sections 3.4 and/or 3.5 to use its best efforts to effect the registration of any Registrable Securities, the Corporation shall, as expeditiously as practicable:

 

(a)                                 prepare and file with the Commission a registration statement with respect to such securities and use its best efforts to cause such registration statement to become and remain effective in accordance with Section 3.7(b) hereof;

 

(b)                                 prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective until the earlier of (i) the sale of all Registrable Securities covered thereby or (ii) nine months from the date such registration statement first becomes effective, and to comply with the provisions of the Securities Act with respect to the sale or other disposition of all Registrable Securities covered by such registration statement;

 

(c)                                  furnish to each holder whose Registrable Securities are being registered pursuant to this Section 3 such number of copies of any summary prospectus or other prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as such holder may reasonably request in order to facilitate the public sale or other disposition of such Registrable Securities;

 

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(d)                                 use its best efforts to register or qualify the Registrable Securities covered by such registration statement under the securities or blue sky laws of such jurisdictions as each holder whose Registrable Securities are being registered shall reasonably request, and do any and all other acts or things which may be necessary or advisable to enable such holder to consummate the public sale or other disposition in such jurisdictions of such Registrable Securities; provided, however, that the Corporation shall not be required to consent to general service of process for all purposes in any jurisdiction where it is not then subject to process, qualify to do business as a foreign corporation where it would not be otherwise required to qualify or submit to liability for state or local taxes where it is not otherwise liable for such taxes;

 

(e)                                  at any time when a prospectus covered by such registration statement and relating thereto is required to be delivered under the Securities Act within the appropriate period mentioned in Section 3.7(b) hereof, notify each holder whose Registrable Securities are being registered of the happening of any event as a result of which the prospectus included in such registration, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and, at the request of such holder, prepare, file and furnish to such holder a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such shares, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing;

 

(f)                                   if the Corporation has delivered preliminary or final prospectuses to the holders of Registrable Securities that are being registered and after having done so the prospectus is amended to comply with the requirements of the Securities Act, the Corporation shall promptly notify such holders and, if requested, such holders shall immediately cease making offers of Registrable Securities and return all prospectuses to the Corporation. The Corporation shall promptly provide such holders with revised prospectuses and, following receipt of the revised prospectuses, such holders shall be free to resume making offers of the Registrable Securities; and

 

(g)                                  furnish, at the request of any holder whose Registrable Securities are being registered, on the date that such Registrable Securities are delivered to the underwriters for sale in connection with a registration pursuant to this Agreement if such securities are being sold through underwriters, or on the date that the registration statement with respect to such securities becomes effective if such securities are not being sold through underwriters, (i) an opinion, dated such date, of the counsel representing the Corporation for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to the underwriters, if any, and to the holder or holders making such request, and (ii) a letter dated such date, from the independent certified public accountants of the Corporation, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters, if any, and to the holder or holders making such request.

 

3.8                       Expenses.  The Corporation shall pay all expenses incurred by the Corporation in complying with this Section 3, including all registration and filing fees (including

 

10

 

all expenses incident to filing with the FINRA), fees and expenses of complying with the securities and blue sky laws of all such jurisdictions in which the Registrable Securities are proposed to be offered and sold, printing expenses and fees and disbursements of counsel (including with respect to each registration effected pursuant to Sections 3.4 and 3.5, the reasonable fees and disbursements of a counsel for the holders of Registrable Securities that are being registered pursuant to this Section 3, such counsel for the holders of Registrable Securities shall be designated by a vote of the holders of a majority of the Registrable Securities to be included in such registration); provided, however, that all underwriting discounts and selling commissions applicable to the Registrable Securities covered by registrations effected pursuant to Section 3.4 or 3.5 hereof shall be borne by the seller or sellers thereof, in proportion to the number of Registrable Securities sold by each such seller or sellers.

 

3.9                       Indemnification.

 

(a)                                 In the event of any registration of any Registrable Securities under the Securities Act pursuant to this Section 3 or registration or qualification of any Registrable Securities pursuant to Section 3.7(d) hereof, the Corporation shall indemnify and hold harmless the seller of such shares, each underwriter of such shares, if any, each broker or any other person acting on behalf of such seller and each other person, if any, who controls any of the foregoing persons, within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which any of the foregoing persons may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any registration statement under which such Registrable Securities were registered under the Securities Act, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereto, or any document incident to registration or qualification of any Registrable Securities pursuant to Section 3.7(d) hereof or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading or, with respect to any prospectus, necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or any violation by the Corporation of the Securities Act or any state securities or blue sky laws applicable to the Corporation and relating to action or inaction required of the Corporation in connection with such registration or qualification under the Securities Act or such state securities or blue sky laws. The Corporation shall reimburse on demand such seller, underwriter, broker or other person acting on behalf of such seller and each such controlling person for any legal or any other expenses reasonably incurred by any of them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Corporation shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in said registration statement, preliminary or final prospectus or amendment or supplement thereto or any document incident to registration or qualification of any Registrable Securities pursuant to Section 3.7(d) hereof, in reliance upon and in conformity with written information furnished to the Corporation by such seller, underwriter, broker, other person or controlling person specifically for use in the preparation hereof.

 

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(b)                                 Before Registrable Securities held by any prospective seller shall be included in any registration pursuant to this Section 3, such prospective seller and any underwriter acting on its behalf shall have agreed to indemnify and hold harmless (in the same manner and to the same extent as set forth in paragraph (a)) the Corporation, each director of the Corporation, each officer of the Corporation who signs such registration statement and any person who controls the Corporation within the meaning of the Securities Act, with respect to any untrue statement or omission from such registration statement, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereto, if such untrue statement or omission was made in reliance upon and in conformity with written information furnished to the Corporation through an instrument duly executed by such seller or such underwriter specifically for use in the preparation of such registration statement, preliminary prospectus, final prospectus or amendment or supplement; provided, however, that the maximum amount of liability in respect of such indemnification shall be limited, in the case of each prospective seller, to an amount equal to the net proceeds actually received by such prospective seller from the sale of Registrable Securities effected pursuant to such registration.

 

(c)                                  Promptly after receipt by an indemnified party of notice of the commencement of any action involving a claim referred to in Section 3.9(a) or (b) hereof, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 3.9, give written notice to the latter of the commencement of such action. In case any such action is brought against an indemnified party, the indemnifying party will be entitled to participate in and to assume the defense thereof jointly with any other indemnifying party similarly notified to the extent that it may wish, with counsel reasonably satisfactory to such indemnified party, and, after notice to such indemnified party from the indemnifying party of its election to assume the defense thereof, the indemnifying party shall be responsible for any legal or other expenses subsequently incurred by such indemnifying party in connection with the defense thereof; provided, however, that, if any indemnified party shall have reasonably concluded that there may be one or more legal defenses available to such indemnified party which are different from or additional to those available to the indemnifying party, or that such claim or litigation involves or could have an effect upon matters beyond the scope of the indemnity agreement provided in this Section 3.9, the indemnifying party shall not have the right to assume the defense of such action on behalf of such indemnified party, and such indemnifying party shall reimburse such indemnified party and any person controlling such indemnified party for the fees and expenses of counsel retained by the indemnified party which are reasonably related to the matters covered by the indemnity agreement provided in this Section 3.9. The indemnifying party shall not make any settlement of any claims in respect of which it is obligated to indemnify an indemnified party or parties hereunder, without the written consent of the indemnified party or parties, which consent shall not be unreasonably withheld.

 

(d)                                 In order to provide for just and equitable contribution to joint liability under the Securities Act, in any case in which either (i) any Holder exercising rights under this Agreement, or any controlling person of any such holder, makes a claim for indemnification pursuant to this Section 3.9, but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 3.9 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of any such holder or any such

 

12

 

controlling person in circumstances for which indemnification is provided under this Section 3.9; then, in each such case, the Corporation and such holder will contribute to the aggregate losses, claims, damages or liabilities to which they may be subject as is appropriate to reflect the relative fault of the Corporation and such holder in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, it being understood that the parties acknowledge that the overriding equitable consideration to be given effect in connection with this provision is the ability of one party or the other to correct the statement or omission which resulted in such losses, claims, damages or liabilities, and that it would not be just and equitable if contribution pursuant hereto were to be determined by pro rata allocation or by any other method of allocation which does not take into consideration the foregoing equitable considerations. Notwithstanding the foregoing, (i) no such holder will be required to contribute any amount in excess of the proceeds to it of all Registrable Securities sold by it pursuant to such registration statement, and (ii) no person or entity guilty of fraudulent misrepresentation, within the meaning of Section 11(f) of the Securities Act, shall be entitled to contribution from any person or entity who is not guilty of such fraudulent misrepresentation.

 

(e)                                  Notwithstanding any of the foregoing, if, in connection with an underwritten public offering of any Registrable Securities, the Corporation, the holders of such Registrable Securities and the underwriters enter into an underwriting or purchase agreement relating to such offering which contains provisions covering indemnification among the parties, then the indemnification provision of this Section 3.9 shall be deemed inoperative for purposes of such offering.

 

3.10                        Removal of Legends, Etc.  Notwithstanding the foregoing provisions of this Section 3, the restrictions imposed by this Section 3 upon the transferability of any Restricted Stock shall cease and terminate when (a) any such Restricted Stock are sold or otherwise disposed of in accordance with the intended method of disposition by the seller or sellers thereof set forth in a registration statement or such other method contemplated by Section 3 hereof that does not require that the securities transferred bear the legend set forth in Section 3.2 hereof, including a Transfer pursuant to Rule 144 or a successor rule thereof (as amended from time to lime), or (b) the holder of Restricted Stock has met the requirements for transfer of such Restricted Stock pursuant to subparagraph (b)(1) of Rule 144 or a successor rule thereof (as amended from time to time) promulgated by the Commission under the Securities Act. Whenever the restrictions imposed by this Section 3 have terminated, a holder of a certificate for Restricted Stock as to which such restrictions have terminated shall be entitled to receive from the Corporation, without expense, a new certificate not bearing the restrictive legend set forth in Section 3.2 hereof and not containing any other reference to the restrictions imposed by this Section 3.

 

3.11                        Lock-up Agreement.

 

(a)                                 Each Stockholder agrees that, if the Corporation or a managing underwriter so requests of such Stockholder in connection with a registered public offering of securities of the Corporation, such Stockholder will not, without the prior written consent of the Corporation or such underwriters, sell, assign, transfer, make a short sale of, loan, grant any option for the purchase of, or exercise registration rights with respect to any shares of Common Stock or shares of capital stock or other securities of the Corporation convertible into or

 

13

 

exercisable for, whether directly or indirectly, shares of Common Stock, other than to a member of such Stockholder’s Group, during the period of (i) 180 days following the closing of the first public offering of securities offered and sold for the account of the Corporation that is registered under the Securities Act, or (ii) 90 days following the closing of any other public offering of securities offered and sold for the account of the Corporation that is registered under the Securities Act; provided that such request is made of all officers, directors and 1% and greater Stockholders and each such person shall be similarly bound; and, provided, further, that nothing in this Section 3.11(a) shall prevent any Stockholder from participating in any registered public offering of the Corporation as a selling stockholder or security holder.

 

(b)                                 In the event that the Corporation releases or causes to be released any Stockholder from any restrictions on transfer set forth in the foregoing provisions of this Section 3.11, the Corporation shall release or cause to be released all other Stockholders in similar fashion and any such release of all Stockholders shall be implemented on a pro rata basis.

 

3.12                        Furnish Information.  It shall be a condition precedent to the obligations of the Corporation to take any action pursuant to this Section 3 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Corporation such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as is reasonably required to effect the registration of such Holder’s Registrable Securities.

 

3.13                        Termination of Registration Rights.  The right of any Holder to request registration or inclusion of Registrable Securities in any registration pursuant to this Section 3 shall terminate upon the earlier to occur of: (a) such time as Rule 144 or another similar exemption under the Securities Act is available for the sale of all of such Holder’s shares without volume, manner of sale or other limitation during a three-month period without registration; and (b) the Expiration Date.

 

SECTION 4.  Remedies.  In case any one or more of the covenants and/or agreements set forth in this Agreement shall have been breached by any party hereto, the party or parties entitled to the benefit of such covenants or agreements may proceed to protect and enforce its or their rights, either by suit in equity and/or action at law, including an action for damages as a result of any such breach and/or an action for specific performance of any such covenant or agreement contained in this Agreement.  The rights, powers and remedies of the parties under this Agreement are cumulative and not exclusive of any other right, power or remedy which such parties may have under any other agreement or law. No single or partial assertion or exercise of any right, power or remedy of a party hereunder shall preclude any other or further assertion or exercise thereof.

 

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SECTION 5.  Successors and Assigns.  Except as otherwise expressly provided herein, this Agreement shall bind and inure to the benefit of the Corporation and each of the Stockholder parties hereto and the respective successors and permitted assigns of the Corporation and each of the Stockholder parties hereto (including any member of a Stockholder’s Group).  Subject to the requirements of Section 3 hereof, this Agreement and the rights and duties of the any Stockholder set forth herein may be freely assigned, in whole or in part, by such Stockholder to any member of their respective Group, provided such transferee is an “affiliate” of such Stockholder, as the case may be, as such term is defined under Rule 501 of the Securities Act (it being recognized and agreed that each member of the Oxford/Saints Group shall be deemed to be “affiliates” of each other for this purpose).  Subject to the requirements of Section 3 hereof, the rights under this Agreement may be assigned (but only with related obligations) by  a Holder to a transferee of Registrable Securities that, after such transfer, holds at least 100,000 shares of Registrable Securities (subject to appropriate adjustment for stock splits, stock dividends, combinations and other recapitalizations).  For the purposes of determining the number of shares of Registrable Securities held by a transferee, the holdings of a transferee (a) that is an affiliate or stockholder of a Holder; (b) who is a Holder’s Immediate Family Member; or (c) that is a trust for the benefit of an individual Holder or such Holder’s Immediate Family Member shall be aggregated together and with those of the transferring Holder; provided further that all transferees who would not qualify individually for assignment of rights shall have a single attorney-in-fact for the purpose of exercising any rights, receiving notices, or taking any action under this Agreement.  Any transferee from a Stockholder to whom rights under Section 3 are transferred shall, as a condition to such transfer, deliver to the Corporation a written instrument by which such transferee identifies itself (together with its address), gives the Corporation notice of the transfer of such rights, identifies the securities of the Corporation owned or acquired by it and agrees to be bound by the obligations imposed hereunder to the same extent as if such transferee were a Stockholder hereunder. A transferee to whom rights are transferred pursuant to this Section 5 will be thereafter deemed to be a Stockholder for the purpose of the execution of such transferred rights and may not again transfer such rights to any other person or entity, other than as provided in this Section 5.  Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assignees any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided herein.

 

SECTION 6.  Duration of Agreement.  The rights and obligations of the Corporation and each Stockholder set forth herein shall survive indefinitely, unless and until, by the respective terms of this Agreement, they are no longer applicable.

 

SECTION 7.  Entire Agreement.  This Agreement, together with the other writings referred to herein or delivered pursuant hereto which form a part hereof, contains the entire agreement among the parties with respect to the subject matter hereof and amends, restates and supersedes all prior and contemporaneous arrangements or understandings with respect thereto, including the Prior Agreement.

 

SECTION 8.  Notices.  All notices, requests, consents and other communications hereunder to any party shall be deemed to be sufficient if contained in a written instrument delivered in person or duly sent by first class registered, certified or overnight mail, postage prepaid, by electronic mail or telecopied with a confirmation copy by regular mail, addressed or

 

15

 

telecopied, as the case may be, to such party at the address, email address or telecopier number, as the case may be, set forth below or such other address, email address or telecopier number, as the case may be, in the Corporation’s records or as may hereafter be designated in writing by the addressee to the addressor listing all parties:

 

(i)                                   if to the Corporation, to:

 

Radius Health, Inc.

201 Broadway

Sixth Floor

Cambridge, MA 02139

Attention: Chief Executive Officer

Telecopier: (617) 551-4701

 

with a copy to:

 

Latham & Watkins LLP

John Hancock Tower, 20th Floor

200 Clarendon Street

Boston, MA 02116

Attention: Peter N. Handrinos

Telecopier: (617) 948-6001

 

(ii)                                if to the Stockholders, as set forth on Schedule 1 or Schedule 2.

 

All such notices, requests, consents and communications shall be deemed to have been received (a) in the case of personal delivery, on the date of such delivery, (b) in the case of mailing, on the third business day following the date of such mailing, (c) in the case of overnight mail, on the first business day following the date of such mailing, (d) in the case of electronic mail, when sent and (e) in the case of facsimile transmission, when confirmed by facsimile machine report.

 

SECTION 9.  Changes.  The terms and provisions of this Agreement may not be modified or amended, or any of the provisions hereof waived, temporarily or permanently, except pursuant to the written consent of the Corporation and the holders of a majority of the Registrable Securities then outstanding; provided that the Corporation may in its sole discretion waive compliance with Section 3.3 (and the Corporation’s failure to object promptly in writing after notification of a proposed assignment allegedly in violation of Section 3.3 shall be deemed to be a waiver); and provided further that any provision hereof may be waived by any waiving party on such party’s own behalf, without the consent of any other party.  Notwithstanding the foregoing, any modification or amendment to this Agreement that would adversely affect one Stockholder in a manner that is directed specifically to such Stockholder, rather than to all Stockholders, shall be subject to the approval of each such Stockholder.  It is understood that this separate consent would not be required if any such adverse effect results from the application of criteria uniformly to all Stockholders even if such application may affect Stockholders differently.

 

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SECTION 10.  Counterparts.  This Agreement may be executed in any number of counterparts, each such counterpart shall be deemed to be an original instrument and all such counterparts together shall constitute but one agreement.

 

SECTION 11.  Headings; Interpretation.  The headings of the various sections of this Agreement have been inserted for convenience of reference only, and shall not be deemed to be a part of this Agreement. All references in this Agreement to “including” shall be deemed to mean “including without limitation.”

 

SECTION 12.  Nouns and Pronouns.  Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of names and pronouns shall include the plural and vice-versa.

 

SECTION 13.  Severability.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

SECTION 14.  Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, excluding choice of law rules thereof that would result in the application of the laws of any other jurisdiction; provided that Section 3 of this Agreement shall be governed by and construed in accordance with the General Corporation Law of the State of Delaware as to matters within the scope thereof.

 

SECTION 15.  Additional Parties.  Notwithstanding anything to the contrary contained herein, any holder of shares of capital stock of the Corporation may become a party to this Agreement as a “Stockholder” following the delivery to, and written acceptance by, the Corporation of an executed Instrument of Adherence to this Agreement in the form attached hereto as Annex A.  No action or consent by Stockholder parties hereto shall be required for such joinder to this Agreement by such additional Stockholder, so long as such additional Stockholder has agreed in writing to be bound by all of the obligations as Stockholder party hereunder as indicated in the Instrument of Adherence and the Instrument of Adherence has been accepted in writing by the Corporation.

 

SECTION 16.  Waiver; Amendment.  The parties to this Agreement hereby agree and acknowledge that the Corporation has, as of, and at all times prior to, the Effective Time, complied with all of its obligations under the Prior Agreement and that the Corporation shall have no liability or obligation to pay any damages under the Prior Agreement with respect to any right, covenant or obligation arising under the Prior Agreement at any time prior to the Effective Time.  All provisions of, rights granted and covenants made in, the Prior Agreement are hereby waived, released and superseded, with full retrospective and prospective effect, in their entirety and shall have no further force or effect.  Without limiting the foregoing, the right of first refusal set forth in Section 2.3 of the Prior Agreement shall not be applicable to shares of Common Stock issued in the offering contemplated by the Corporation’s Registration Statement on Form S-1 (Reg. No. 333-194150).

 

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SECTION 17.  Effectiveness.  Effective as of, and contingent upon, the Effective Time, the Prior Agreement is hereby amended and restated in its entirety to read as set forth in this Agreement.  This Agreement shall be effective as of, and contingent upon, the Effective Time.

 

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IN WITNESS WHEREOF the parties hereto have executed this Agreement on the date first above written.

 

 

	
 
    	
CORPORATION:
    
	
 
    	
 
    
	
 
    	
RADIUS   HEALTH, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Robert E. Ward
    
	
 
    	
Name:   Robert E. Ward
    
	
 
    	
Title:   President & Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
INVESTORS:
    
	
 
    	
 
    
	
 
    	
F2   BIOSCIENCE III, L.P.
    
	
 
    	
 
    
	
 
    	
By:   F2 Bioscience GP, Ltd., General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Morana Jovan-Embiricos
    
	
 
    	
Name:   Morana Jovan-Embiricos
    
	
 
    	
Title:   Director of Investment Adviser
    
	
 
    	
To   F2 Bioscience III, L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
F2   BIOSCIENCE IV L.P.
    
	
 
    	
 
    
	
 
    	
By:   F2 Bioscience IV GP Ltd., General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Morana Jovan-Embiricos
    
	
 
    	
Name:   Morana Jovan-Embiricos
    
	
 
    	
Title:   Authorized Signatory
    
	
 
    	
 
    
	
 
    	
F2   BIO VENTURES V L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:   F2 Bio Ventures GP Ltd., General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Morana Jovan-Embiricos
    
	
 
    	
Name:   Morana Jovan-Embiricos
    
	
 
    	
Title:   Authorized Signatory
    

 

 

	
 
    	
BB   BIOTECH VENTURES II, L.P.
    
	
 
    	
 
    
	
 
    	
On   behalf of BB Biotech Ventures GP (Guernsey) Limited
   as General Partners to BB Biotech Ventures II, L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ben Morgan
    
	
 
    	
Name:   Ben Morgan
    
	
 
    	
Title:   Director
    
	
 
    	
 
    
	
 
    	
BIOTECH   GROWTH N.V.
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   H.J. van Neutegem
    
	
 
    	
Name:   H.J. van Neutegem
    
	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
MPM   BIOVENTURES III, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
MPM   BioVentures III GP, L.P.,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
By:
    	
MPM   BioVentures III LLC,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ansbert Gadicke
    
	
 
    	
Name:   Ansbert Gadicke
    
	
 
    	
Title:   Series A Member
    
	
 
    	
 
    
	
 
    	
MPM   BIOVENTURES III-QP, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
MPM   BioVentures III GP, L.P.,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
By:
    	
MPM   BioVentures III LLC,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ansbert Gadicke
    
	
 
    	
Name:   Ansbert Gadicke
    
	
 
    	
Title:   Series A Member
    
	
 
    	
 
    
	
 
    	
MPM   BIOVENTURES III GMBH & CO.
    BETEILIGUNGS KG
    
	
 
    	
 
    
	
 
    	
By:
    	
MPM   BioVentures III GP, L.P.,
    
	
 
    	
 
    	
in   its capacity as the Managing Limited Partner
    
	
 
    	
By:
    	
MPM   BioVentures III LLC,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ansbert Gadicke
    
	
 
    	
Name:   Ansbert Gadicke
    
	
 
    	
Title:   Series A Member
    
					

 

 

	
 
    	
MPM   BIOVENTURES III PARALLEL FUND, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
MPM   BioVentures III GP, L.P.,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
By:
    	
MPM   BioVentures III LLC,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ansbert Gadicke
    
	
 
    	
Name:   Ansbert Gadicke
    
	
 
    	
Title:   Series A Member
    
	
 
    	
 
    
	
 
    	
MPM   ASSET MANAGEMENT INVESTORS 2003 BVIII

LLC
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ansbert Gadicke
    
	
 
    	
Name:   Ansbert Gadicke
    
	
 
    	
Title:   Manager
    
	
 
    	
 
    
	
 
    	
MPM   BIO IV NVS STRATEGIC FUND, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
MPM   BioVentures IV GP LLC, its General Partner
    
	
 
    	
By:
    	
MPM   BioVentures IV LLC,
    
	
 
    	
 
    	
its   Managing Member
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Ansbert Gadicke
    
	
 
    	
Name:   Ansbert Gadicke
    
	
 
    	
Title:   Member
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
HEALTHCARE   PRIVATE EQUITY LIMITED
   PARTNERSHIP
    
	
 
    	
 
    
	
 
    	
By:  Waverley Healthcare Private Equity Limited,   its general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    

 

 

	
 
    	
OBP   IV – HOLDINGS LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
OXFORD   BIOSCIENCE PARTNERS IV., L.P.
    
	
 
    	
By:
    	
OBP   Management iv, L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Jonathan Fleming
    
	
 
    	
Name:   Jonathan Fleming
    
	
 
    	
Title:   General Partner
    
	
 
    	
 
    
	
 
    	
By:   SAINTS CAPITAL GRANITE, L.P.
    
	
 
    	
By:   SAINTS CAPITAL GRANITE, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Scott Halsted
    
	
 
    	
Name:   Scott Halsted
    
	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
MRNA   II - HOLDINGS LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
MRNA   FUND II, L.P.
    
	
 
    	
By:
    	
OBP   MANAGEMENt II , L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Jonathan Fleming
    
	
 
    	
Name:   Jonathan Fleming
    
	
 
    	
Title:   General Partner
    
	
 
    	
 
    
	
 
    	
By:   SAINTS CAPITAL GRANITE, L.P.
    
	
 
    	
By:   SAINTS CAPITAL GRANITE, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Scott Halsted
    
	
 
    	
Name:   Scott Halsted
    
	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
THE   WELLCOME TRUST LIMITED,
    
	
 
    	
AS   TRUSTEE OF THE WELLCOME TRUST
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Peter Pereira Gray
    
	
 
    	
Name:   Peter Pereira Gray
    
	
 
    	
Title:   Managing Director,
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
BROOKSIDE   CAPITAL PARTNERS FUND, L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Matthew McPherron
    
	
 
    	
Name:   Matthew McPherron
    
	
 
    	
Title:   Managing Director
    

 

 

	
 
    	
NORDIC   BIOSCIENCE CLINICAL
    
	
 
    	
DEVELOPMENT   VII A/A
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
IPSEN   PHARMA SAS
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
The   Breining Family Trust dated August 15, 2003
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Dr. Raymond   F. Schinazi
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Dr. Dennis   A. Carson
    
	
 
    	
 
    
	
 
    	
The   David E. Thompson Revocable Trust
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
Jonnie   K. Westbrook Revocable Trust dated March 17,
   2000
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
HEALTHCARE   VENTURES VII, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
HealthCare   Partners VII, L.P.
    
	
 
    	
 
    	
Its   General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jeffrey Steinberg
    
	
 
    	
Name:   Jeffrey Steinberg
    
	
 
    	
Title:   Administrative Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
The   Kent C. Westbrook Revocable Trust,
    

 

 

	
 
    	
Dated   March 17, 2000
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:   Kent Westbrook, M.D.
    
	
 
    	
Title:   Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
H.   Watt Gregory III
    
	
 
    	
 
    
	
 
    	
H2   ENTERPRISES, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
Hostetler   Family Trust UTD 3/18/92
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:   Karl Y. Hostetler
    
	
 
    	
Title:   Co-Trustee
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:   Margarethe. Hostetler
    
	
 
    	
Title:   Co-Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
The   Richman Trust dated 2/6/83
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:   Douglas D. Richman
    
	
 
    	
Title:   Co-Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:   Eva A. Richman,
    
	
 
    	
Title:   Co-Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Stavros   C. Manolagas
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Michael   Rosenblatt, M.D.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Patricia   E. Rosenblatt
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Dr. John   Potts, Jr and Susanne K. Potts
    

 

 

	
 
    	
Irrevocable   Trust for Stephen K. Potts
    
	
 
    	
dated   6-15-05
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
John   Thomas Potts, M.D.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
John   A. Katzenellenbogen, PhD.
    
	
 
    	
 
    
	
 
    	
John   A. Katzenellenbogen Trust
    
	
 
    	
Under   Agreement Dated August 2, 1999
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Benita   S. Katzenellenbogen, PhD
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Bart   Henderson
    
	
 
    	
 
    
	
 
    	
BOARD   OF TRUSTEES OF THE UNIVERSITY OF ARKANSAS
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Benjamin   C. Lane
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Ruff   Trust dated l-1-02
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:   F. Bronson Van Wyck
    
	
 
    	
Title:   Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Stavroula   Kousteni, PhD.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Robert   L. Jilka, PhD.
    

 

 

	
 
    	
 
    
	
 
    	
Robert S. Weinstein, M.D.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Teresita   M. Bellido, PhD.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Dotty   McIntyre
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Thomas   E. Sparks
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Samuel   Ho
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Charles   O’Brien, PhD.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Alwyn   Michael Parfitt, M.D.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Barnette   Pitzele
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Kelly   Colbourn
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Julie   Glowacki
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Socrates   E. Papapoulos, M.D.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Tonya   D. Smith
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Maysoun   Shomali
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Jonathan   Guerriero
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
E.   Kelly Sullivan
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Cecil   Richard Lyttle
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Louis   O’Dea
    

 

 

	
 
    	
 
    
	
 
    	
Brian   Nicholas Harvey
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Christopher   Miller
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Chris   Glass
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Maria   Grunwald
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Kathy   Welch
    

 

 

Schedule 1

 

List of Common Stockholders

 

	
Name of Common Stockholder
    	
 
    	
Address of Record
    
	
Teresita M. Bellido, Ph.D
    	
 
    	
9302   Windrift Way

Zionsville, IN   46077
    
	
Julie   Glowacki, Ph.D
    	
 
    	
76   Perkins Street

Jamaica   Plain, MA 02130
    
	
H2   Enterprises, LLC
    	
 
    	
c/o H. Watt Gregory, III. Esq.

Kutak   Rock, LLP

124   West Capitol Avenue, Suite 2000

Little   Rock, AR 72201
    
	
Hostetler   Family Trust, UTD 3/18/92
    	
 
    	
14024   Rue St. Raphael

Del   Mar, CA 92014
    
	
Robert   L, Jilka, Ph.D
    	
 
    	
14202   Clarborne Court

Little   Rock, AR 72211
    
	
Benita S. Katzenellenbogen, Ph.D
    	
 
    	
704   West Pennsylvania Ave

Urbana, IL   61801
    
	
John A. Katzenellenbogen, Ph. D
    	
 
    	
704   West Pennsylvania Ave

Urbana, IL   61801
    
	
John   A. Katzenellenbogen Trust Under Agreement dated August 2, 1999
    	
 
    	
704   West Pennsylvania Ave

Urbana, IL   61801
    
	
Stavroula   Kousteni, Ph.D
    	
 
    	
58   Hillside Avenue

Glen   Ridge, NJ 07028
    
	
Bart   Henderson
    	
 
    	
45   Prentiss Lane

Belmont,   MA 02478
    
	
Dr. Stavros   C. Manolagas
    	
 
    	
35   River Ridge Circle

Little   Rock AR 72227
    
	
Charles   O’Brien, Ph. D
    	
 
    	
2824   Mossy Creek Dr

Little Rock, AR 72211
    
	
Socrates E. Papapoulos, M.D.
    	
 
    	
Javastraat 64

2585   AR the Hague

The   Netherlands
    
	
Alwyn   Michael Parfitt, M.D.
    	
 
    	
28   Baeza Way

Hot   Springs Village, AR 71909
    
	
John   Thomas Potts, Jr., M.D.
    	
 
    	
18   Hawthorne Street

Cambridge,   MA 02138
    
	
Dr. John   Potts Jr and Susanne K. Potts Irrevocable Trust for Stephen K. Potts, dated   6/15/05
    	
 
    	
18   Hawthorne Street

Cambridge,   MA 02138
    
	
Michael   Rosenblatt, M.D.
    	
 
    	
130   Lake Ave

Newton   Center, MA 02459
    
	
Patricia   E. Rosenblatt
    	
 
    	
876   Beacon Street, Apt 5

Newton,   MA 02459
    
	
Ruff   Trust, F. Bronson Van Wyck, Trustee
    	
 
    	
2141   Highway 224 East

Tukerman,   AR 72473
    
	
Tonya   D. Smith
    	
 
    	
7790   Shannon Rd.

Pine   Bluff, AR 71603
    
	
Thomas   E. Sparks, Jr.
    	
 
    	
PO   Box 472290
    

 

 

	
Name of Common Stockholder
    	
 
    	
Address of Record
    
	
 
    	
 
    	
San   Francisco, CA 94147
    
	
Board   of Trustees of the University of Arkansas
    	
 
    	
University   of Arkansas

c/o   UAMS Bioventures Technology Licensing & Life Science Incubator

4301   West Markham St #831

Little   Rock, AR 72205-7199
    
	
Robert S. Weinstein, M.D.
    	
 
    	
11   Chalmette

Little   Rock, AR 72211
    
	
The   Kent C. Westbrook Revocable Trust, dated March 17, 2000
    	
 
    	
56   River Ridge Road

Little   Rock, AR 72227
    
	
Jonnie   K. Westbrook Revocable Trust dated March 17, 2000
    	
 
    	
56   River Ridge Road

Little   Rock, AR 72227
    
	
Rich   Lyttle
    	
 
    	
Radius   Health, Inc.

201   Broadway, Sixth Floor

Cambridge,   MA 02139
    
	
Nick   Harvey
    	
 
    	
Radius   Health, Inc.

201   Broadway, Sixth Floor

Cambridge,   MA 02139
    
	
Louis   O’Dea
    	
 
    	
566   Main Street

Hingham,   MA 02043
    
	
Dotty   McIntyre
    	
 
    	
799   Shawsheen Street

Tewksbury,   MA 01876
    
	
Samuel   Ho
    	
 
    	
15   Hillview Ave.

Holbrook,   MA 02343
    
	
Barnett   Pitzelle
    	
 
    	
7924   N Tripp Ave

Skokie, IL   60076
    
	
Kelly   Colbourn
    	
 
    	
123   Oxford Street #3

Cambridge,   MA 01238
    
	
Maysoun   Shomali
    	
 
    	
354   School Street

Watertown,   MA 02472
    
	
Jonathan   Guerriero
    	
 
    	
20   Bazin Lane

Canton,   MA 02021
    
	
E.   Kelly Sullivan
    	
 
    	
23   Bilknap St

Arlington,   MA 02474
    
	
Christopher   Miller
    	
 
    	
1685   Millburne Rd.

Lake   Forest, IL 60045
    
	
Benjamin   C. Lane
    	
 
    	
1284   Deer Trail Lane

Libertyville, IL   60048
    
	
Chris   Glass
    	
 
    	
467   San Fernando St.

San   Diego, CA 92106-3337
    
	
Maria   Grunwald
    	
 
    	
82   Pine St.

Malden,   MA 02148-2355
    
	
Kathy   Welch
    	
 
    	
15   Kristyn Ln.

North   Reading, MA 01864-2629
    

 

 

Schedule 2

 

List of Preferred Stockholders

 

	
Name
    	
 
    	
Address of Record
    
	
F2   Bioscience III, L.P.
    	
 
    	
Ugland   House

South   Church Street

PO   Box 309

George   Town KY1-1104

Grand   Cayman

Cayman   Islands
    
	
 
    	
 
    	
 
    
	
F2   Bioscience IV L.P.
    	
 
    	
Ugland   House

South   Church Street

PO   Box 309

George   Town KY1-1104

Grand   Cayman

Cayman   Islands
    
	
 
    	
 
    	
 
    
	
F2   Bio Ventures V L.P.
    	
 
    	
Ugland   House

South   Church Street

PO   Box 309

George   Town KY1-1104

Grand   Cayman

Cayman   Islands
    
	
 
    	
 
    	
 
    
	
BB   Biotech Ventures II, L.P.
    	
 
    	
Trafalgar   Court

Les   Banques

St.   Peter Port

Guernsey

Channel   Islands

GY1   3QL

 

With   copies to

Martin Münchbach

Bellevue Asset Management

Seestrasse 16

8700   Küsnacht

Switzerland
    
	
 
    	
 
    	
 
    
	
Biotech   Growth N.V.
    	
 
    	
Snipweg   26

Curaçao
    
	
 
    	
 
    	
 
    
	
HealthCare   Ventures VII
    	
 
    	
44   Nassau Street

Princeton,   NJ 08542
    
	
 
    	
 
    	
 
    
	
MPM   BioVentures III, L.P.
    	
 
    	
c/o   MPM Capital

200   Clarendon Street, 54th Floor

Boston, MA 02116
    
	
 
    	
 
    	
 
    
	
MPM BioVentures III - QP, L.P.
    	
 
    	
c/o MPM Capital

200   Clarendon Street, 54th Floor
    

 

 

	
Name
    	
 
    	
Address of Record
    
	
 
    	
 
    	
Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
MPM   Bio IV NVS Strategic Fund, L.P.
    	
 
    	
c/o   MPM Capital

200   Clarendon Street, 54th Floor

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
MPM   BioVentures III GmbH & Co. Beteiligungs KG
    	
 
    	
c/o   MPM Capital

200   Clarendon Street, 54th Floor

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
MPM   BioVentures III Parallel Fund, L.P.
    	
 
    	
c/o   MPM Capital

200   Clarendon Street, 54th Floor

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
MPM   Asset Management Investors 2003 BVIII LLC
    	
 
    	
c/o   MPM Capital

200   Clarendon Street, 54th Floor

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
Healthcare   Private Equity Limited Partnership

(Registered   Number SL004769)
    	
 
    	
Edinburgh   One, Morrison Street

Edinburgh,   EH3 8BE  United Kingdom
    
	
 
    	
 
    	
 
    
	
Dr. Raymond   F. Schinazi
    	
 
    	
Emory   University School of Medicine

Veterans   Affairs Medical Center

1670   Clairmont Road

Decatur,   GA 30033
    
	
 
    	
 
    	
 
    
	
The   Wellcome Trust Limited as trustee of the Wellcome Trust
    	
 
    	
215   Euston Road

London   NW1 2BE

England
    
	
 
    	
 
    	
 
    
	
OBP   IV Holdings, LLC
    	
 
    	
c/o   Oxford Bioscience Partners

222   Berkeley Street

Suite 1960

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
mRNA   Fund II Holdings, LLC
    	
 
    	
c/o   Oxford Bioscience Partners

222   Berkeley Street

Suite 1960

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
H.   Watt Gregory, III 
    	
 
    	
Suite 2000

124   West Capitol Avenue

Little   Rock, Arkansas 72201
    
	
 
    	
 
    	
 
    
	
The   Breining Family Trust 2/15/03
    	
 
    	
PO Box 9540

Rancho Santa Fe, CA 92067
    
	
 
    	
 
    	
 
    
	
The   Richman Trust dated 2/6/83
    	
 
    	
9551   La Jolla Farms Road

La   Jolla, CA 92037
    
	
 
    	
 
    	
 
    
	
Brookside   Capital Partners Fund, L.P.
    	
 
    	
Attn:  Brookside Legal Department

Bain   Capital, LLC

John   Hancock Tower

200   Clarendon Street

Boston,   MA 02116
    
	
 
    	
 
    	
 
    
	
David   E. Thompson Revocable Trust
    	
 
    	
1045   Mason Street, # 501

San   Francisco, CA 94108
    

 

 

	
Dennis   A. Carson 
    	
 
    	
9672   Clairborne Square

La   Jolla, CA  92037
    
	
 
    	
 
    	
 
    
	
Nordic   Bioscience Clinical Development VII A/S
    	
 
    	
Herlev   Hovedgade 207

2730   Herlev

Denmark

Attn:   Clinical Trial Leader & Medical Advisor/Clinical Studies

Phone:   45.4452.5251

Fax:   45.4452.5251
    
	
 
    	
 
    	
 
    
	
Ipsen   Pharma SAS 
    	
 
    	
65   Quai Georges Gorse

Boulogne   Billancourt 92100

Franci
    

 

 

Annex A

 

Instrument of Adherence
  to
 Fifth Amended and Restated

Stockholders’ Agreement
 dated April 18, 2014

 

Reference is hereby made to that certain FIFTH AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT (the “Agreement”), dated the 18th day of April, 2014, entered into by and among (i) Radius Health, Inc., a Delaware corporation (the “Corporation”) and the Stockholders party thereto. Capitalized terms used herein without definition shall have the respective meanings ascribed thereto in the Agreement.

 

The undersigned (the “New Stockholder Party”), in order to become the owner or holder of                                    shares of Common Stock and all other shares of the Corporation’s capital stock hereinafter acquired, of the Corporation (the “Acquired Shares”), hereby agrees that, from and after the date hereof, the undersigned has become a party to the Agreement in the capacity of a Stockholder party to the Agreement, and is entitled to all of the benefits under, and is subject to all of the obligations, restrictions and limitations set forth in, the Agreement that are applicable to such Stockholder parties and shall be deemed to have made all of the representations and warranties made by such Stockholder parties thereunder.  This Instrument of Adherence shall take effect and shall become a part of the Agreement on the latest date of execution by both the New Stockholder Party and the Corporation.

 

Executed under seal as of the date set forth below under the laws of the Commonwealth of Massachusetts.

 

	
 
    	
Print   Name:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Signature:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
Accepted:
    	
 
    
	
RADIUS   HEALTH, INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Date:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00230-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00230-of-00352.parquet"}]]