Document:

Registration Rights Agreement dated November 3, 2004

 Exhibit 4.4 
  

  
  
 REGISTRATION RIGHTS AGREEMENT 
  
 Dated as of November 3, 2004 
  
 among 
  
 AMÉRICA MÓVIL, S.A. de C.V., 
  
 RADIOMÓVIL DIPSA, S.A. de C.V. 
  
 and 
  
 CITIGROUP GLOBAL MARKETS INC. 
  
 CREDIT SUISSE
FIRST BOSTON LLC 
  
 as Initial Purchasers 

 
  

 REGISTRATION RIGHTS AGREEMENT dated as of November 3, 2004 (the “Agreement”) is entered
into by and among América Móvil, S.A. de C.V. (the “Company”), a sociedad anónima de capital variable organized under the laws of the United Mexican States (“Mexico”), Radiomóvil
Dipsa, S.A de C.V. (the “Guarantor”), a sociedad anónima de capital variable, organized under the laws of Mexico, and Citigroup Global Markets Inc. and Credit Suisse First Boston LLC (the “Initial
Purchasers”). 
  
 The Company, the Guarantor and the
Initial Purchasers are parties to the Purchase Agreement dated October 28, 2004 (the “Purchase Agreement”), which provides for the sale by the Company to the Initial Purchasers of U.S.$500,000,000 aggregate principal amount of the
5.750% Senior Notes due 2015 (the “Notes”). The Notes will be guaranteed as to the payment of principal, premium, if any, and interest pursuant to the Indenture (as defined below) by the Guarantor (the
“Guarantees”). As an inducement to the Initial Purchasers to enter into the Purchase Agreement, the Company and the Guarantor have agreed to provide to the Initial Purchasers and their direct and indirect transferees the
registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the closing under the Purchase Agreement. 
  
 In consideration of the foregoing, the parties hereto agree as follows: 
  
 1. Definitions. As used in this Agreement, the following terms shall have the following meanings: 
  
 “Business Day” means any day that is not a
Saturday, Sunday or other day on which commercial banks in New York City or Mexico City are authorized or required by law, regulation or executive order to remain closed. 
  
 “Closing Date” shall have the meaning set forth in the Purchase Agreement. 
  
 “CNBV” means the Mexican Comisión
Nacional Bancaria y de Valores (National Banking and Securities Commission). 
  
 “Company” shall have the meaning set forth in the preamble and shall also include the Company’s successors.

  
 “Exchange Act” means the
U.S. Securities Exchange Act of 1934, as amended. 
  
 “Exchange Dates” shall have the meaning set forth in Section 2(a)(ii) hereof. 
  
 “Exchange Offer” means the exchange offer by the Company and the Guarantor of Exchange Notes for Registrable Notes
pursuant to Section 2(a) hereof. 

 “Exchange Offer Registration” means a registration under the Securities
Act effected pursuant to Section 2(a) hereof. 
  
 “Exchange Offer Registration Statement” means an exchange offer registration statement on Form F-4 (or, if applicable, on another appropriate form) and all amendments and supplements to such registration statement, in each
case including the Prospectus contained therein, all exhibits thereto and any document incorporated by reference therein. 
  
 “Exchange Notes” means 5.750% Notes due 2015 issued by the Company under the Indenture containing terms substantially
identical to the Notes (except that (i) interest thereon shall accrue from the last date to which interest has been paid or duly provided for on the Notes or, if no such interest has been paid or duly provided for, from the Closing Date, (ii) the
transfer restrictions and legends relating to restrictions on ownership and transfer thereof as a result of the issuance of the Notes without registration under the Securities Act shall be eliminated, and (iii) the 5.750% Notes due 2015 shall be
represented by one or more global Exchange Notes in book-entry form unless exchanged for Exchange Notes in definitive certificated form under the limited circumstances provided in the Indenture) to be offered to Holders of Registrable Notes in
exchange for Registrable Notes pursuant to the Exchange Offer. 
  
 “Guarantee” shall have the meaning set forth in the preamble to this Agreement. 
  
 “Guarantor” shall have the meaning set forth in the preamble and shall also include Guarantor’s successors.

  
 “Holder” means any of the
Initial Purchasers, for so long as it owns any Registrable Notes, and each of its successors, assigns and direct and indirect transferees who become owners of Registrable Notes under the Indenture; provided that for purposes of Sections 4 and
5 of this Agreement, the term “Holders” shall include Participating Broker-Dealers. 
  
 “Initial Purchasers” shall have the meaning set forth in the preamble. 
  
 “Indenture” means collectively (i) the
Indenture dated as of March 9, 2004 among the Company, the Guarantor and J.P. Morgan Chase Bank, as trustee, as supplemented by the First Supplemental Indenture dated as of March 9, 2004, the Second Supplemental Indenture dated as of March 9, 2004
and the Third Supplemental Indenture dated as of April 27, 2004 and (ii) the Fourth Supplemental Indenture dated as of November 3, 2004 among the Company, the Guarantor and J.P. Morgan Chase Bank, as trustee, relating to the Notes, in each case, as
amended from time to time in accordance with the terms thereof. 
  
 “Majority Holders” means the Holders of a majority of the aggregate principal amount of outstanding Registrable Notes; provided that, whenever the consent or approval of Holders of a specified
percentage of Registrable Notes is 

  

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required hereunder, Registrable Notes or Exchange Notes owned directly or indirectly by the Company or any of its affiliates (as such term is defined in Rule
405 under the 1933 Act) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage or amount. 
  
 “Participating Broker-Dealers” shall have the meaning set forth in Section 4(a) hereof. 
  
 “Person” means an individual, partnership,
limited liability company, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof. 
  
 “Prospectus” means the prospectus included in a Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus supplement, including a prospectus supplement with respect to the terms of the offering of any portion of the Registrable Notes covered by a Shelf Registration Statement, and by all other
amendments and supplements to such prospectus, and in each case including any document incorporated by reference therein. 
  
 “Purchase Agreement” shall have the meaning set forth in the preamble. 
  
 “Registrable Notes” means all of the Notes;
provided that the Notes shall cease to be Registrable Notes when (i) a Registration Statement with respect to such Notes shall have been declared effective under the Securities Act and such Notes shall have been disposed of pursuant to such
Registration Statement, (ii) such Notes shall have been sold pursuant to Rule 144 (or any similar provision then in force, but not Rule 144A) under the Securities Act, (iii) such Notes shall have ceased to be outstanding, (iv) such Notes have been
exchanged for Exchange Notes which have been registered pursuant to the Exchange Offer Registration Statement upon consummation of the Exchange Offer unless, in the case of any Exchange Notes referred to in this clause (iv), such Exchange Notes are
held by a Participating Broker-Dealer or otherwise are not freely tradable without any limitations or restrictions under the Securities Act (in which case such Exchange Notes will be deemed to be Registrable Notes until the earlier of (A) the
expiration of the period specified in Section 4(b) hereof and (B) such time as such Exchange Notes are sold to a purchaser in whose hands such Exchange Notes are freely tradeable without any limitations or restrictions under the Securities Act) or
(v) such Notes are eligible to be sold pursuant to Rule 144(k). 
  
 “Registration Expenses” means any expenses and costs incident to performance of or compliance by the Company and the Guarantor with this Agreement, including without limitation: (i) all SEC or
National Association of Securities Dealers, Inc. registration and filing fees, (ii) all fees and expenses incurred in connection with compliance with state securities or blue sky laws in jurisdictions designated pursuant to Section 3(d) hereof
(including reasonable 

  

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and documented fees and disbursements of counsel for any Underwriters or Holders in connection with blue sky qualification of any Exchange Notes or
Registrable Notes), (iii) all expenses of any Persons in preparing or assisting in preparing, word processing, printing and distributing any Registration Statement, any Prospectus and any amendments or supplements thereto, any underwriting
agreements, securities sales agreements or other similar agreements and any other documents relating to the performance of and compliance with this Agreement, (iv) any rating agency fees, (v) all fees and disbursements relating to the qualification
of the Indenture under applicable securities laws, (vi) the fees and disbursements of the Trustee and its counsel, (vii) the fees and disbursements of U.S. and Mexican and other counsel to the Company and Guarantor, and, in the case of a Shelf
Registration Statement, the reasonable and documented fees and expenses of one U.S. counsel and, if applicable, one Mexican counsel, for the Holders, the Underwriters and the Initial Purchasers (which counsel shall be Simpson Thacher & Bartlett
LLP and Mijares, Angoitia, Cortés y Fuentes, S.C. or such other counsel as may be selected by the Majority Holders and which counsel may also be counsel for the Initial Purchasers), (viii) all fees relating to the registration of the Exchange
Notes or the Registrable Notes with the Special Section of the Registry maintained by the CNBV; (ix) all fees relating to the listing of Exchange Notes or Registrable Notes on the Luxembourg Stock Exchange, (x) the fees and disbursements of the
independent public accountants of the Company and the Guarantor; however, the term “Registration Expenses” shall exclude fees and expenses of counsel to the Underwriters (other than fees and expenses set forth in clauses (ii) and (vii)
above) or the Holders and underwriting discounts and commissions and transfer taxes, if any, relating to the sale or disposition of Registrable Notes by a Holder. 
  
 “Registration Statement” means any registration statement of the Company and the Guarantor
that covers any of the Exchange Notes or Registrable Notes pursuant to the provisions of this Agreement and all amendments and supplements to any such registration statement, including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and any document incorporated by reference therein. 
  
 “SEC” means the U.S. Securities and Exchange Commission. 
  
 “Securities Act” means the U.S. Securities Act of 1933, as amended from time to time.

  
 “Shelf Effectiveness Period”
shall have the meaning set forth in Section 2(b) hereof. 
  
 “Shelf Registration” means a registration effected pursuant to Section 2(b) hereof. 
  
 “Shelf Registration Statement” means a “shelf” registration statement of the Company and the Guarantor that
covers all the Registrable Notes (but no 

  

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other securities unless approved by the Holders whose Registrable Notes are to be covered by such Shelf Registration Statement) on an appropriate form under
Rule 415 under the Securities Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective amendments, in each case including the Prospectus contained therein,
all exhibits thereto and any document incorporated by reference therein. 
  
 “Trust Indenture Act” means the U.S. Trust Indenture Act of 1939, as amended from time to time, or any rules, regulations and forms promulgated thereunder. 
  
 “Trustee” means the Trustee with respect to
the Notes under the Indenture. 
  
 “Underwriter” shall have the meaning set forth in Section 3 hereof. 
  
 “Underwritten Offering” means an offering in which Registrable Notes are sold to an Underwriter for reoffering to the
public. 
  
 For purposes of this Agreement, (i) all references in
this Agreement to any Registration Statement, preliminary prospectus or Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the version filed with the SEC pursuant to its EDGAR; (ii) all references in this
Agreement to financial statements and schedules and other information which is “contained”, “included” or “stated” in any Registration Statement or Prospectus (or other similar references) shall be deemed to mean and
include all such financial statements and schedules and other information which is incorporated or deemed to be incorporated by reference in such Registration Statement or Prospectus, as the case may be; (iii) all references in this Agreement to
amendments or supplements to any Registration Statement or Prospectus shall be deemed to mean and include the filing of any document under the Exchange Act which is incorporated or deemed to be incorporated by reference in such Registration
Statement or Prospectus, as the case may be; (iv) all references in this Agreement to Rule 144, Rule 144A or Rule 405 under the Securities Act, and all references to any sections or subsections thereof or terms defined therein, shall include any
successor provisions thereto; and (v) all references in this Agreement to “days” (but not to Business Days) means calendar days. 
  
 For purposes of this Agreement, all references to the “Notes”, the “Exchange Notes”, or the “Registrable Notes” shall be
deemed to include the related Guarantees of such Notes by the Guarantor pursuant to the Indenture, except where otherwise indicated or the context otherwise requires. 
  
 2. Registration Under the Securities Act. (a) To the extent not prohibited by any applicable law or applicable
interpretations of the staff of the SEC and except in the circumstances contemplated by Section 2(b)(i) below, the Company and the Guarantor shall use their reasonable best efforts to (i) cause to be filed with the SEC an 

  

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Exchange Offer Registration Statement covering an offer to the Holders to exchange all the Registrable Notes for Exchange Notes as soon as practicable
following the Closing Date, (ii) cause such Exchange Offer Registration Statement to be declared effective by the SEC as soon as practicable following filing with the SEC, and (iii) have such Registration Statement remain effective until the earlier
of (A) 120 days after the closing of the Exchange Offer and (B) such time as all Participating Broker-Dealers no longer own any Registrable Notes. The Company and the Guarantor shall commence the Exchange Offer promptly after the Exchange Offer
Registration Statement is declared effective by the SEC and use their reasonable best efforts to complete the Exchange Offer not later than 60 days after such effective date. For purposes of this Agreement, the Exchange Offer shall be deemed
completed upon the earlier to occur of (i) the Company and the Guarantor having exchanged the Exchange Notes for all outstanding Registrable Notes (other than those held by Holders that are ineligible to participate in the Exchange Offer) pursuant
to the Exchange Offer and (ii) the Company and the Guarantor having exchanged, pursuant to the Exchange Offer, Exchange Notes for all Registrable Notes that have been properly tendered and not withdrawn before the expiration of the Exchange Offer;
provided, however, that the Company and the Guarantor may, in their discretion, accept tenders of Registrable Notes for Exchange Notes subsequent to the date the Company and the Guarantor consummate the Exchange Offer with respect to
Registrable Notes tendered as of the date of initial consummation, and the Exchange Offer shall be deemed to have been consummated notwithstanding any such extension of the tender period. 
  
 The Company and the Guarantor shall commence the Exchange Offer by mailing the related Prospectus, appropriate letters of
transmittal and other accompanying documents to each Holder stating, in addition to such other disclosures as are required by applicable law: 
  
 (i) that the Exchange Offer is being made pursuant to this Agreement and that all Registrable Notes validly tendered and not properly
withdrawn will be accepted for exchange; 
  
 (ii)
the dates of acceptance for exchange (which shall be a period of at least 20 Business Days from the date such notice is mailed) (the “Exchange Dates”); 
  
 (iii) that any Registrable Note not tendered will remain outstanding and continue to accrue interest but
will not retain any rights under this Agreement; 
  
 (iv) that any Holder electing to have a Registrable Note exchanged pursuant to the Exchange Offer will be required to surrender such Registrable Note, together with the appropriate letters of transmittal, to the institution and at the
address (located in New York City) and in the manner specified in the notice, prior to the close of business on the last Exchange Date; and 
  

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 (v) that any Holder will be entitled to withdraw its election, not later than the close
of business on the last Exchange Date, in the manner specified in such notice. 
  
 As a condition to participating in the Exchange Offer, a Holder will be required to represent to the Company and the Guarantor that (i) any Exchange Notes to be received by it will be acquired in the ordinary course
of its business, (ii) at the time of the commencement of the Exchange Offer it has no arrangement or understanding with any Person to participate in the distribution (within the meaning of the Securities Act) of the Exchange Notes in violation of
the provisions of the Securities Act, (iii) it is not an “affiliate” (within the meaning of Rule 405 under Securities Act) of the Company or the Guarantor and (iv) if such Holder is a broker-dealer, that it will receive Exchange Notes for
its own account in exchange for Registrable Notes that were acquired as a result of market-making or other trading activities, and that it will deliver, to the extent required by applicable law or regulation or SEC pronouncement, a Prospectus in
connection with any resale of such Exchange Notes. 
  
 As soon as
practicable after the last Exchange Date, the Company and the Guarantor shall: 
  
 (i) accept for exchange Registrable Notes or portions thereof validly tendered and not properly withdrawn pursuant to the Exchange Offer;
and 
  
 (ii) deliver, or cause to be delivered,
to the Trustee for cancellation all Registrable Notes or portions thereof so accepted for exchange by the Company and issue, and cause the Trustee to promptly authenticate and deliver to each Holder, Exchange Notes equal in principal amount to the
principal amount of the Registrable Notes surrendered by such Holder. 
  
 The Company and the Guarantor shall use their reasonable best efforts to complete the Exchange Offer as provided above and shall comply with the applicable requirements of the Securities Act, the Exchange Act and other applicable laws and
regulations in connection with the Exchange Offer. 
  
 (b) In the
event that (i) the Company and the Guarantor determine that the Exchange Offer Registration provided for in Section 2(a) above is not permitted or may not be completed as soon as practicable after the last Exchange Date because it would violate any
applicable law or applicable interpretations of the Staff of the SEC, or because the Exchange Notes received by Holders are not or would not be, upon receipt, transferable by each such holder without need for further compliance with Section 5 of the
Securities Act (except for the requirement to deliver a Prospectus in connection with any resale by a Participating Broker-Dealer), (ii) the Exchange Offer is not for any other reason completed by May 31, 2005 or (iii) upon completion of the
Exchange Offer the Initial Purchasers shall so request in connection with any offering or sale of Registrable Notes initially purchased by it pursuant to the Purchase Agreement, the Company and the Guarantor shall use their reasonable best efforts
to cause to be filed as soon as practicable after such determination, date or request, as the case may 

  

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be, a Shelf Registration Statement providing for the sale of all the Registrable Notes by the Holders thereof and to have such Shelf Registration Statement
declared effective by the SEC. 
  
 If the Company and the
Guarantor receive reasonable advance notice that they will be required to file a Shelf Registration Statement pursuant to clause (iii) of the preceding paragraph, the Company and the Guarantor shall use their reasonable best efforts to file and have
declared effective by the SEC both an Exchange Offer Registration Statement pursuant to Section 2(a) with respect to all Registrable Notes and a Shelf Registration Statement (which may be a combined Registration Statement with the Exchange Offer
Registration Statement) with respect to offers and sales of Registrable Notes held by the Initial Purchasers after completion of the Exchange Offer. 
  
 The Company and the Guarantor agree to use their reasonable best efforts to keep the Shelf Registration Statement continuously effective until expiration
of the period referred to in Rule 144(k) under the Securities Act with respect to the Registrable Notes or such shorter period that will terminate when all the Registrable Notes covered by the Shelf Registration Statement have been sold pursuant to
the Shelf Registration Statement (the “Shelf Effectiveness Period”). The Company and the Guarantor further agree to supplement or amend the Shelf Registration Statement and the related Prospectus if required by the rules,
regulations or instructions applicable to the registration form used by the Company and the Guarantor for such Shelf Registration Statement or by the Securities Act or by any other rules and regulations thereunder for shelf registration or if
reasonably requested by a Holder of Registrable Notes with respect to information relating to such Holder, and to use their reasonable best efforts to cause any such amendment to become effective and such Shelf Registration Statement and Prospectus
to become usable as soon as thereafter practicable. The Company and the Guarantor agree to furnish to the Holders of Registrable Notes copies of any such supplement or amendment promptly after its being used or filed with the SEC. 
  
 (c) The Company and the Guarantor shall pay all Registration Expenses in
connection with the registration provided in Sections 2(a) and 2(b). Each Holder shall pay all underwriting discounts and commissions and transfer taxes, if any, relating to the sale or disposition of such Holder’s Registrable Notes pursuant to
the Shelf Registration Statement. 
  
 (d) In the event that either
the Exchange Offer is not completed or the Shelf Registration Statement, if required hereby, is not declared effective by the SEC on or prior to May 31, 2005 (June 30, 2005 solely in the case of a Shelf Registration Statement pursuant to Section
2(b)(iii) above), the interest rate on the Registrable Notes will be increased by 0.50% per annum until the Exchange Offer is completed or the Shelf Registration Statement, if required hereby, is declared effective by the SEC or the Notes become
freely tradable under the Securities Act, at which time the increased interest shall cease to accrue. 
  

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 If the Shelf Registration Statement has been declared effective by the SEC and thereafter either ceases
to be effective or the Prospectus contained therein ceases to be usable at any time during the Shelf Effectiveness Period, and such failure to remain effective or usable exists for more than 30 days (whether or not consecutive) in any 12-month
period (two suspensions not to exceed 30 days each in any 365-day period in the case of a Suspension described in Section 3), then the interest rate on the Registrable Notes will be increased by 0.50% per annum commencing on the 31st day in such 12-month period and ending on such date that the Shelf Registration Statement has again been declared effective or
the Prospectus again becomes usable, at which time the increased interest shall cease to accrue; provided, however, that if the Prospectus ceases to be usable because audited financial statements are required to be filed with the SEC and
incorporated by reference in the Shelf Registration Statement to comply with the undertaking of the Company and the Guarantor pursuant to Item 512(a)(4) of Regulation S-K (or any successor provision), such a suspension shall not be a suspension for
purposes of the foregoing provision unless and to the extent its duration exceeds 60 days. 
  
 3. Registration Procedures. In connection with their obligations pursuant to Sections 2(a) and 2(b) hereof, the Company and the Guarantor shall as expeditiously as possible: 
  
 (a) prepare and file with the SEC a Registration Statement on the appropriate
form under the Securities Act, which form (i) shall be selected by the Company, (ii) shall, in the case of a Shelf Registration, be available for the sale of the Registrable Notes by selling Holders thereof and (iii) shall comply as to form in all
material respects with the requirements of the applicable form and include all financial statements and other information required by the SEC to be filed therewith; and use their reasonable best efforts to cause such Registration Statement to become
effective and remain effective for the applicable period in accordance with Section 2 hereof; 
  
 (b) prepare and file with the SEC such amendments and post-effective amendments to each Registration Statement as may be necessary to keep such Registration Statement effective for the applicable period in accordance
with Section 2 hereof and cause each Prospectus to be supplemented by any required prospectus supplement and, as so supplemented, to be filed pursuant to Rule 424 under the Securities Act; and keep each Prospectus current during the period described
in Section 4(3) of and Rule 174 under the Securities Act that is applicable to transactions by brokers or dealers with respect to the Registrable Notes or Exchange Notes; 
  
 (c) in the case of a Shelf Registration, furnish to each Holder of Registrable Notes, to U.S. counsel to the Initial
Purchasers, to counsel for such Holders and to each Underwriter of an Underwritten Offering of Registrable Notes, if any, without charge, as many copies of each Prospectus, including each preliminary Prospectus, and any amendment or supplement
thereto as they may reasonably request, in order to facilitate the sale or other disposition of the Registrable Notes thereunder; and the Company and the Guarantor consent to the use of such Prospectus and any amendment or supplement thereto in
accordance with applicable law by each of the 

  

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selling Holders of Registrable Notes and any such Underwriters in connection with the offering and sale of the Registrable Notes covered by and in the manner
described in such Prospectus or any amendment or supplement thereto in accordance with applicable law; 
  
 (d) use their reasonable best efforts to register or qualify the Registrable Notes under all applicable state securities or blue sky laws of such
jurisdictions as a majority of the Holders of Registrable Notes covered by a Registration Statement shall reasonably request in writing by the time the applicable Registration Statement is declared effective by the SEC; cooperate with the Holders in
connection with any filings required to be made with the National Association of Securities Dealers, Inc.; and do any and all other acts and things that may be reasonably necessary or advisable to enable each Holder to complete the disposition in
each such jurisdiction of the Registrable Notes owned by such Holder; provided that neither the Company nor the Guarantor shall be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such
jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject;

  
 (e) in the case of a Shelf Registration, notify each Holder of
Registrable Notes, counsel for such Holders and counsel for the Initial Purchasers promptly and, if requested by any such Holder or counsel, confirm such advice in writing (i) when a Registration Statement has become effective and when any
post-effective amendment thereto has been filed and becomes effective, (ii) of any request by the SEC or any state securities authority for amendments and supplements to a Registration Statement and Prospectus or for additional information after the
Registration Statement has become effective, (iii) of the issuance by the SEC or any state securities authority of any stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that purpose, (iv)
if, between the effective date of a Registration Statement and the closing of any sale of Registrable Notes covered thereby, the representations and warranties of the Company and the Guarantor contained in any underwriting agreement, securities
sales agreement or other similar agreement, if any, relating to an offering of such Registrable Notes cease to be true and correct in all material respects or if the Company receives any notification with respect to the suspension of the
qualification of the Registrable Notes for sale in any jurisdiction or the initiation of any proceeding for such purpose (to the extent that such agreement provides for such notice), (v) of the happening of any event during the period a Shelf
Registration Statement is effective that makes any statement made in such Registration Statement or the related Prospectus untrue in any material respect or that requires the making of any changes in such Registration Statement or Prospectus in
order to make the statements therein not misleading and (vi) of any determination by the Company or the Guarantor that a post-effective amendment to a Registration Statement would be appropriate; 
  
 (f) use their reasonable best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement at the earliest possible 

  

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moment and provide immediate notice to each Holder of the withdrawal of any such order; 
  
 (g) use all reasonable efforts to obtain the consent or approval of each Mexican or U.S. governmental agency or authority,
whether federal or state that may be required to effect the Exchange Offer and the offering and sale of Exchange Notes; 
  
 (h) in the case of a Shelf Registration, furnish to each Holder of Registrable Notes, without charge, at least one conformed copy of each Registration
Statement and any post-effective amendment thereto (without any documents incorporated therein by reference or exhibits thereto, unless requested); 
  
 (i) in the case of a Shelf Registration, cooperate with the selling Holders of Registrable Notes to facilitate the timely preparation and delivery of
certificates representing Registrable Notes to be sold and not bearing any restrictive legends and enable such Registrable Notes to be issued in such denominations and registered in such names (consistent with the provisions of the Indenture) as the
selling Holders may reasonably request at least one Business Day prior to the closing of any sale of Registrable Notes; 
  
 (j) in the case of a Shelf Registration, upon the occurrence of any event contemplated by Section 3(e)(v) hereof, use their reasonable best efforts to
prepare and file with the SEC a supplement or post-effective amendment to a Registration Statement or the related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to
purchasers of the Registrable Notes, such Prospectus will not contain any 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, in the light of the
circumstances under which they were made, not misleading; and the Company and the Guarantor shall notify the Holders of Registrable Notes to suspend use of the Prospectus as promptly as practicable after the occurrence of such an event, and such
Holders hereby agree to suspend use of the Prospectus until the Company and the Guarantor have amended or supplemented the Prospectus to correct such misstatement or omission; 
  
 (k) if reasonably requested by the Initial Purchasers or Holders and their respective counsel, a reasonable time prior to
the filing of any Registration Statement, any Prospectus, any amendment to a Registration Statement or amendment or supplement to a Prospectus or of any document that is to be incorporated by reference into a Registration Statement or a Prospectus
after initial filing of a Registration Statement (and prior to the completion of an Exchange Offer in the case of an Exchange Offer Registration Statement), provide copies of such document to the Initial Purchasers and U.S. counsel to the Initial
Purchasers (and, in the case of a Shelf Registration Statement, to the Holders of Registrable Notes and their counsel) and make such of the representatives of the Company and the Guarantor as shall be reasonably requested by the Initial Purchasers
or such counsel (and, in the case of a Shelf Registration Statement, the Holders of Registrable Notes or their counsel) available for discussion of such document; and, in such event, the Company and the 

  

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Guarantor shall not, at any time after initial filing of a Registration Statement, file any Prospectus, any amendment of or supplement to a Registration
Statement or a Prospectus, or any document that is to be incorporated by reference into a Registration Statement or a Prospectus, of which the Initial Purchasers and such counsel (and, in the case of a Shelf Registration Statement, the Holders of
Registrable Notes and their counsel) shall not have previously been advised and furnished a copy or to which the Initial Purchasers or such counsel (and, in the case of a Shelf Registration Statement, the Holders or their counsel) shall reasonably
and timely object; 
  
 (l) obtain CUSIP and ISIN numbers for all
Exchange Notes or Registrable Notes, as the case may be, not later than the effective date of a Registration Statement, and provide the Trustee with printed or word-processed certificates for the Exchange Notes or Registrable Notes, as the case may
be, in a form eligible for deposit with the Depositary; 
  
 (m)
take all reasonable action necessary to maintain the registration of the Exchange Notes, at the time of the Exchange Offer, with the Sección Especial of the Registro Nacional de Valores (the “Registry”)
maintained by the CNBV; 
  
 (n) take all reasonable action
necessary to ensure that the Exchange Notes, at the time of the consummation of the Exchange Offer (or as soon as reasonably practicable thereafter), are listed on the Luxembourg Stock Exchange and take such other actions as shall be necessary or
advisable to maintain such listing of the Exchange Notes; provided that if such listing of the Exchange Notes shall be obtained and (i) it subsequently becomes impracticable or unduly burdensome, in the good faith determination of the
Company, to maintain, due to changes in listing requirements occurring subsequent to the Closing Date or (ii) the Directive of the European Parliament and of the Council 2003/0045 (COD) (the Transparency Directive) is adopted and implemented in
Luxembourg in a manner that would require the Company to publish financial information according to accounting principles or standards that are materially different from those it applies in its financial reporting under the securities laws of Mexico
and the United States, the Company may de-list the Exchange Notes from the Luxembourg Stock Exchange; and, in the event of any such de-listing, the Company shall use its reasonable best efforts to obtain an alternative admission to listing, trading
and/or quotation of the Exchange Notes by another listing authority, exchange or system within or outside the European Union as it may reasonably decide, provided that, if such alternative admission is not available or is, in the
Company’s reasonable opinion, unduly burdensome, the Company shall have no further obligation in respect of any listing of the Exchange Notes; 
  
 (o) cause the Indenture to be qualified under the Trust Indenture Act in connection with the registration of the Exchange Notes or Registrable Notes, as
the case may be; cooperate with the Trustee and the Holders to effect such changes to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and execute, and use their
reasonable best efforts to cause the Trustee to execute, all documents as may be required to effect such changes 

  

 12 

 
and all other forms and documents required to be filed with the SEC to enable the Indenture to be so qualified in a timely manner; 
  
 (p) in the case of a Shelf Registration, make available for inspection by a
representative of Holders of Registrable Notes that confirm to the Company and the Guarantor that it is their current intention to sell Registrable Notes pursuant to a Shelf Registration (an “Inspector”), any Underwriter
participating in any disposition pursuant to such Shelf Registration Statement, and counsel and accountants designated by the Holders, at reasonable times and in a reasonable manner, all pertinent financial and other records, documents and
properties of the Company and the Guarantor as may be reasonably requested by any such Inspector, Underwriter, counsel or accountant in connection with a Shelf Registration Statement, and cause the respective officers, directors and employees of the
Company and the Guarantor to supply such information; provided that if any such information is identified in writing by the Company and the Guarantor as being confidential or proprietary, each Person receiving such information shall use such
Person’s reasonable best efforts to protect the confidentiality of such information to the extent such action is otherwise not inconsistent with, an impairment of or in derogation of the substantial and necessary rights and interests of any
Inspector, Holder or Underwriter; 
  
 (q) if reasonably requested
by any Holder of Registrable Notes covered by a Registration Statement, promptly incorporate in a Prospectus supplement or post-effective amendment such information with respect to such Holder as such Holder reasonably requests to be included
therein and make all required filings of such Prospectus supplement or such post-effective amendment as soon as the Company has received notification of the matters to be incorporated in such filing; and 
  
 (r) in the case of a Shelf Registration, enter into such customary agreements
and take all such other actions in connection therewith (including those requested by the Holders of a majority in principal amount of the Registrable Notes being sold) in order to expedite or facilitate the disposition of such Registrable Notes
including, but not limited to, an Underwritten Offering and in such connection, (i) to the extent possible, make such representations and warranties to the Holders and any Underwriters of such Registrable Notes with respect to the business of the
Company and the Guarantor and their respective subsidiaries, the Registration Statement, Prospectus and documents incorporated by reference or deemed incorporated by reference, if any, in each case, in form, substance and scope as are customarily
made by issuers to underwriters in underwritten offerings and confirm the same if and when requested, (ii) obtain opinions of counsel to the Company and the Guarantor (which counsel and opinions, in form, scope and substance, shall be reasonably
satisfactory to the Holders and such Underwriters and their respective counsel) addressed to each selling Holder and Underwriter of Registrable Notes, covering the matters customarily covered in opinions requested in underwritten offerings, (iii)
subject to receipt of the documentation to the extent required by Statement of Auditing Standard No. 72 (or successor pronouncements), obtain “comfort” letters from the independent certified public accountants of the Company and the
Guarantor (and, if necessary, any other certified public accountant of any subsidiary of the Company and the Guarantor, or of 

  

 13 

 
any business acquired by the Company and the Guarantor for which financial statements and financial data are or are required to be included in the
Registration Statement) addressed to each selling Holder and Underwriter of Registrable Notes, such letters to be in customary form and covering matters of the type customarily covered in “comfort” letters in connection with underwritten
offerings, (iv) deliver such documents and certificates as may be reasonably requested by the Holders of a majority in principal amount of the Registrable Notes being sold or the Underwriters, and which are customarily delivered in underwritten
offerings, to evidence the continued validity of the representations and warranties of the Company and the Guarantor made pursuant to clause (i) above and to evidence compliance with any customary conditions contained in an underwriting agreement.

  
 In the case of a Shelf Registration Statement, the Company and
the Guarantor may require each Holder of Registrable Notes to furnish to the Company or the Guarantor, as the case may be, such information regarding such Holder and the proposed disposition by such Holder of such Registrable Notes as the Company or
the Guarantor may from time to time reasonably request in writing. 
  
 In the case of any Registration Statement, each Holder of Registrable Notes agrees that, upon receipt of any notice from the Company or the Guarantor to the effect of the happening of any event of the kind described in Section 3(e)(iii) or
3(e)(iv) hereof or that the Prospectus included in any Registration Statement cannot be used for any other reason, such Holder will forthwith discontinue disposition of Registrable Notes pursuant to such Registration Statement until such
Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 3(i) hereof and, if so directed by the Company and the Guarantor, such Holder will deliver to the Company and the Guarantor all copies in its
possession, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Registrable Notes that is current at the time of receipt of such notice. The Company and the Guarantor may give any such notice only
twice during any 365-day period and any such suspensions shall not exceed 30 days for each suspension and there shall not be more than two suspensions in effect during any 365-day period; provided, however, that if the Prospectus ceases to be
usable because audited financial statements are required to be filed with the SEC and incorporated by reference in the Shelf Registration Statement to comply with the undertaking of the Company and the Guarantor pursuant to Item 512(a)(4) of
Regulation S-K (or any successor provision), such a suspension shall not be a suspension for purposes of the foregoing provision unless and to the extent its duration exceeds 60 days. 
  
 If the Company and the Guarantor shall give any such notice to suspend the disposition of Registrable Notes pursuant to any
Registration Statement, the Company and the Guarantor shall extend the period during which the Registration Statement shall be maintained effective pursuant to this Agreement by the number of days during the period from and including the date of the
giving of such notice to and including the date when the Holders shall have received copies of the supplemented or amended Prospectus necessary to resume such dispositions. 
  

 14 

 The Holders of Registrable Notes covered by a Shelf Registration Statement who desire to do so may sell
such Registrable Notes in an Underwritten Offering. In any such Underwritten Offering, the investment banker or investment bankers and manager or managers (the “Underwriters”) that will administer the offering will be selected by
the Majority Holders of the Registrable Notes included in such offering. 
  
 4. Participation of Broker-Dealers in Exchange Offer. (a) The Staff of the SEC has taken the position that any broker-dealer that receives Exchange Notes for its own account in the Exchange Offer in exchange
for Notes that were acquired by such broker-dealer as a result of market-making or other trading activities (a “Participating Broker-Dealer”) may be deemed to be an “underwriter” within the meaning of the Securities Act
and must deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Notes. 
  
 The Company and the Guarantor understand that it is the Staff’s position that if the Prospectus contained in the Exchange Offer Registration
Statement includes a plan of distribution containing a statement to the above effect and the means by which Participating Broker-Dealers may resell the Exchange Notes, without naming the Participating Broker-Dealers or specifying the amount of
Exchange Notes owned by them, such Prospectus may be delivered by Participating Broker-Dealers to satisfy their prospectus delivery obligation under the Securities Act in connection with resales of Exchange Notes for their own accounts, so long as
the Prospectus otherwise meets the requirements of the Securities Act. 
  
 (b) In light of the above, and notwithstanding the other provisions of this Agreement, the Company and the Guarantor agree to amend or supplement the Prospectus contained in the Exchange Offer Registration Statement, as would otherwise be
contemplated by Section 3(i), for a period of up to 120 days after the last Exchange Date (as such period may be extended pursuant to the penultimate paragraph of Section 3 of this Agreement), if requested by the Initial Purchasers or by one or more
Participating Broker-Dealers, in order to expedite or facilitate the disposition of any Exchange Notes by Participating Broker-Dealers consistent with the positions of the Staff recited in Section 4(a) above. The Company and the Guarantor further
agree that Participating Broker-Dealers shall be authorized to deliver such Prospectus during such period in connection with the resales contemplated by this Section 4. 
  
 (c) The Initial Purchasers shall have no liability to the Company, the Guarantor or any Holder with respect to any request
that they may make pursuant to Section 4(b) above. 
  
 5.
Indemnification and Contribution. (a) The Company and the Guarantor, jointly and severally, agree to indemnify and hold harmless the Initial Purchasers and each Holder, their respective affiliates, directors and officers and each Person, if
any, who controls the Initial Purchasers or any Holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against 

  

 15 

 
any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses incurred in connection with any suit,
action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement
or any Prospectus or any omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading,
except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information furnished to the
Company or the Guarantor in writing or to any selling Holder by or on behalf of such Person expressly for use therein. In connection with any Underwritten Offering permitted by Section 3, the Company and the Guarantor, jointly and severally, will
also indemnify the Underwriters, their directors and officers and each Person who controls such Underwriters (within the meaning of the Securities Act and the Exchange Act) to the same extent as provided above with respect to the indemnification of
the Holders, if requested in connection with any Registration Statement. Notwithstanding the preceding sentences of this Section 5(a), with respect to any such untrue statement in or omission from a preliminary Prospectus, the indemnity agreement
contained in this Section 5(a) shall not inure to the benefit of any Holder to the extent that the sale to the Person asserting any such loss, claim, damage or liability was an initial resale by such Holder and any such loss, claim, damage or
liability of or with respect to such Holder results from the fact that both (i) a copy of the final Prospectus (excluding any documents incorporated by reference therein) was not sent or given to such Person at or prior to the written confirmation
of the sale of such Exchange Notes to such Person and (ii) the untrue statement in or omission from such preliminary Prospectus was corrected in the final Prospectus unless, in either case, such failure to deliver the final Prospectus was a result
of non-compliance by the Company with the provisions of Section 3 hereof. 
  
 (b) Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, the Guarantor, the Initial Purchasers and the other selling Holders, their respective affiliates, the directors of the
Company and the Guarantor, each officer of the Company and the Guarantor who signed the Registration Statement and each Person, if any, who controls the Company, the Guarantor, any Initial Purchaser and any other selling Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in Section 5(a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any
untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Holder furnished to the Company or the Guarantor in writing by such Holder expressly for use in any
Registration Statement and any Prospectus and, subject to the limitation set forth immediately preceding this clause, shall reimburse such Persons for any legal or other expenses reasonably incurred by them in connection with investigating or
defending any loss, claim, damage, liability or action in respect thereof. 
  

 16 

 (c) If any suit, action, proceeding (including any governmental or regulatory investigation), claim or
demand shall be brought or asserted against any Person in respect of which indemnification may be sought pursuant to either Section (a) or (b) above, such Person (the “Indemnified Person”) shall promptly notify the Person against
whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under this Section 5 except
to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have to an Indemnified Person otherwise than under this Section 5. If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying
Person shall retain counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person and any others entitled to indemnification pursuant to this Section 5 that the Indemnifying Person may designate in such proceeding and
shall pay the fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the
Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any
such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between
them. It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as they are incurred. Any such separate firm (x) for the Initial Purchasers, their respective affiliates, directors and officers and any control Persons of
each of the Initial Purchasers shall be jointly designated in writing by the Initial Purchasers, (y) for any Holder, its affiliates, directors and officers and any control Persons of such Holder shall be designated in writing by the Majority Holders
and (z) in all other cases shall be designated in writing by the Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified
Person shall have requested that an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this Section 5(c), the Indemnifying Person shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the 

  

 17 

 
Indemnified Person in accordance with such request prior to the date of such settlement. No Indemnifying Person shall, without the written consent of the
Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such
settlement (A) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (B) does not
include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person. 
  
 (d) If the indemnification provided for in Sections (a) and (b) above is unavailable to an Indemnified Person or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each Indemnifying Person under such Section, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result
of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantor from the offering of the Notes and the Exchange Notes, on the one hand, and by the
Holders from receiving Notes or Exchange Notes registered under the Securities Act, on the other hand, or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) but also the relative fault of the Company and the Guarantor on the one hand and the Holders on the other in connection with the statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The relative fault of the Company and the Guarantor on the one hand and the Holders on the other shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company and the Guarantor or by the Holders and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission. 
  
 (e) The Company, the Guarantor and the Holders agree that it would not be just and equitable if contribution pursuant to this Section 5 were determined by pro rata allocation (even if the Holders were
treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 5(d) above. The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in Section 5(d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim.
Notwithstanding the provisions of this Section 5, in no event shall a Holder be required to contribute any amount in excess of the amount by which the total price at which the Notes or Exchange Notes sold by such Holder exceeds the amount of any
damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 

  

 18 

 
Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. 
  
 (f) The remedies provided for in this Section 5 are not exclusive and shall
not limit any rights or remedies that may otherwise be available to any Indemnified Person at law or in equity. 
  
 (g) The indemnity and contribution provisions contained in this Section 5 shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of the Initial Purchasers or any Holder, their respective affiliates or any Person controlling each of the Initial Purchasers or any Holder, or by or on behalf of the Company
or the Guarantor, their respective affiliates or the officers or directors of or any Person controlling the Company or the Guarantor, (iii) acceptance of any of the Exchange Notes and (iv) any sale of Registrable Notes pursuant to a Shelf
Registration Statement. 
  
 6. General. 
  
 (a) Rule 144 and Rule 144A. For so long as the Company is subject to
the reporting requirements of Section 13 or 15 of the Exchange Act, the Company covenants that it will file all reports required to be filed by it under Section 13(a) or 15(d) of the Exchange Act and the rules and regulations adopted by the SEC
thereunder and that if it ceases to be so required to file such reports, it will upon the request of any Holder or beneficial owner of Registrable Notes (i) make publicly available such information (including, without limitation, the information
specified in Rule 144(c)(2) under the Securities Act) as is necessary to permit sales pursuant to Rule 144 under the Securities Act, (ii) deliver or cause to be delivered, promptly following a request by any Holder or beneficial owner of Registrable
Notes or any prospective purchaser or transferee designated by such Holder or beneficial owner, such information (including, without limitation, the information specified in Rule 144A(d)(4) under the Securities Act) as is necessary to permit sales
pursuant to Rule 144A under the Securities Act, and (iii) take such further action that is reasonable in the circumstances, in each case to the extent required from time to time to enable such Holder to sell its Registrable Notes without
registration under the Securities Act within the limitation of the exemptions provided by (A) Rule 144 under the Securities Act, as such Rule may be amended from time to time, (B) Rule 144A under the Securities Act, as such Rule may be amended from
time to time, or (C) any similar rules or regulations hereafter adopted by the SEC. Upon the request of any Holder or beneficial owner of Registrable Notes, the Company will deliver to such Holder a written statement as to whether it has complied
with such requirements. 
  
 (b) Specific Performance. The
Company and the Guarantor acknowledge that there would be no adequate remedy at law if the Company and the Guarantor failed to perform any of their obligations in this Agreement (including, without limitation, their obligations under Sections 2(a)
and 2(b) hereof) and that any such failure may result in material irreparable injuries to the Initial Purchasers and the Holders from time to time of the Registrable Notes and that it will not be possible to 

  

 19 

 
measure damages for such injuries precisely, and, accordingly the Company and the Guarantor agree that the Initial Purchasers and such Holders, in addition
to any other remedy to which they may be entitled at law or in equity, shall be entitled to compel specific performance of the obligations of the Company and the Guarantor under this Agreement in accordance with the terms and conditions of this
Agreement, in any U.S. federal or New York court located in New York City. 
  
 (c) No Inconsistent Agreements. The Company and the Guarantor represent, warrant and agree that (i) the rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the
rights granted to the holders of any other outstanding securities issued or guaranteed by the Company and the Guarantor under any other agreement and (ii) neither the Company nor the Guarantor has not entered into, or on or after the date of this
Agreement will enter into, any agreement that is inconsistent with the rights granted to the Holders of Registrable Notes in this Agreement or otherwise conflicts with the provisions hereof. 
  
 (d) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given unless the Company and the Guarantor have obtained the written consent of
Holders of at least a majority in aggregate principal amount of the outstanding Registrable Notes affected by such amendment, modification, supplement, waiver or consent; provided that no amendment, modification, supplement, waiver or consent
to any departure from the provisions of Section 5 hereof shall be effective as against any Holder of Registrable Notes unless consented to in writing by such Holder. Any amendments, modifications, supplements, waivers or consents pursuant to this
Section 6(d) shall be by a writing executed by each of the parties hereto. 
  
 (e) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, registered first-class mail, telex, telecopier, or any courier guaranteeing
overnight delivery (i) if to a Holder, at the most current address given by such Holder to the Company by means of a notice given in accordance with the provisions of this Section 6(e), which address initially is, with respect to the Initial
Purchasers, the address set forth in the Purchase Agreement; (ii) if to the Company and the Guarantor, initially at the Company’s address set forth in the Purchase Agreement and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 6(e); and (iii) to such other persons at their respective addresses as provided in the Purchase Agreement and thereafter at such other address, notice of which is given in accordance with the provisions
of this Section 6(e). All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on the next Business Day if timely delivered to an air courier guaranteeing overnight delivery. Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee, at the address specified in the Indenture. 
  

 20 

 (f) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the
successors, assigns and transferees of each of the parties, including, without limitation and without the need for an express assignment, subsequent Holders; provided that nothing herein shall be deemed to permit any assignment, transfer or
other disposition of Registrable Notes in violation of the terms of the Purchase Agreement or the Indenture. If any transferee of any Holder shall acquire Registrable Notes in any manner, whether by operation of law or otherwise, such Registrable
Notes shall be held subject to all the terms of this Agreement, and by taking and holding such Registrable Notes such Person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement
and such Person shall be entitled to receive the benefits hereof. The Initial Purchasers (in their capacity as Initial Purchasers) shall have no liability or obligation to the Company and the Guarantor with respect to any failure by a Holder to
comply with, or any breach by any Holder of, any of the obligations of such Holder under this Agreement. 
  
 (g) Third-Party Beneficiaries. Each Holder shall be a third-party beneficiary to the agreements made hereunder between the Company and the
Guarantor, on the one hand, and the Initial Purchasers, on the other hand, and shall have the right to enforce such agreements directly to the extent it deems such enforcement necessary or advisable to protect its rights or the rights of other
Holders hereunder. 
  
 (h) Purchases and Sales of Notes.
The Company and the Guarantor shall not, and shall use their reasonable best efforts to cause their affiliates (as defined in Rule 405 under the Securities Act) not to, purchase and then resell or otherwise transfer any Registrable Notes.

  
 (i) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. 
  
 (j) Jurisdiction, Venue and Service of Process. Each of the parties
hereto hereby submits to the jurisdiction of any U.S. federal or New York state court in New York City or to the courts of its own corporate domicile, in respect of actions brought against it as a defendant, in any legal suit, action or proceeding
based on or arising under this Agreement and agrees that all claims in respect of such suit or proceeding may be determined in any such court. Each of the Company and the Guarantor waives, to the extent permitted by law, the defense of an
inconvenient forum or objections to personal jurisdiction with respect to the maintenance of such legal suit, action or proceeding. Each of the Company and the Guarantor hereby designates and appoints CT Corporation System, 111 Eighth Avenue,
13th Floor, New York, New York 10011 (the “Process Agent”), as its authorized agent, upon whom
process may be served in any such legal suit, action or proceeding based on or arising under this Agreement, it being understood that the designation and appointment of CT Corporation System as such authorized agent shall become effective
immediately without any 

  

 21 

 
further action on the part of the Company or the Guarantor. Such appointment shall be irrevocable to the extent permitted by applicable law and subject to
the appointment of a successor agent in the United States on terms substantially similar to those contained in this Section 6(j). If the Process Agent shall cease to act as agent for service of process, the Company and the Guarantor shall each
appoint, without unreasonable delay, another such agent, and notify the holders of such appointment. Each of the Company and the Guarantor represents to the holders that it has notified the Process Agent of such designation and appointment and that
the Process Agent has accepted the same in writing. Each of the Company and the Guarantor hereby authorizes and directs the Process Agent to accept such service. Each of the Company and the Guarantor further agrees that service of process upon the
Process Agent and written notice of said service to such party shall be deemed in every respect effective service of process upon the Company, in any such legal suit, action or proceeding. Nothing herein shall affect the right of any holder or any
person controlling any holder to serve process in any other manner permitted by law. 
  
 (k) Additional Amounts. If any amounts to be received by the Initial Purchasers or the Holders under this Agreement are subject to any present or future taxes, assessments, deductions, withholdings,
governmental charges or charges of any nature imposed or levied by or on behalf of Mexico or any political subdivision thereof or taxing authority therein (“Mexican Taxes”), then the Company and the Guarantor shall, jointly and
severally, pay to the Initial Purchasers and the Holders, an additional amount so that the Initial Purchasers and the Holders, shall retain, after taking into consideration all such Mexican Taxes, an amount equal to the amounts owed to them under
this Agreement as if such amounts had not been subject to Mexican Taxes. If any Mexican Taxes are collected by deduction or withholding, the Company and the Guarantor shall, upon request provide to the Initial Purchasers and the Holders, copies of
documentation evidencing the transmittal to the proper authorities of the amount of Mexican Taxes deducted or withheld. Notwithstanding the preceding sentences of this Section 6(k), any withholding or deduction of Mexican Taxes in respect of
payments under the Notes (as opposed to amounts to be received by the Initial Purchasers or the Holders under this Agreement) shall be subject to the gross-up provisions of the Notes and the Indenture. 
  
 (l) Judgment Currency. The Company and the Guarantor, jointly and
severally, shall indemnify the Initial Purchasers and the Holders against any loss incurred by them as a result of any judgment or order against the Company or the Guarantor being given or made and expressed and paid in a currency (“Judgment
Currency”) other than U.S. dollars and as a result of any variation as between (i) the rate of exchange at which the U.S. dollar amount is converted into the Judgment Currency for the purpose of such judgment or order and (ii) the spot rate
of exchange in New York, New York at which the Initial Purchasers on the date of payment of such judgment or order are able to purchase U.S. dollars with the amount of the Judgment Currency actually received by the Initial Purchasers. The foregoing
indemnity shall constitute a separate and independent obligation of the Company and the Guarantor and shall continue in full force and effect notwithstanding any such judgment or order as 

  

 22 

 
aforesaid. The term “spot rate of exchange” shall include any premiums and costs of exchange payable in connection with the purchase of, or
conversion into, U.S. dollars. 
  
 (m) Headings. The
headings in this Agreement are for convenience of reference only, are not a part of this Agreement and shall not limit or otherwise affect the meaning hereof. 
  

(n) Severability. The remedies provided herein are cumulative and not exclusive of any remedies provided by law. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their reasonable best efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable. 
  
 (o) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. 
  
 (p) Miscellaneous. This Agreement contains the entire agreement between the parties relating to the subject matter hereof and supersedes all oral
statements and prior writings with respect thereto. If any term, provision, covenant or restriction contained in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable or against public policy, the remainder
of the terms, provisions, covenants and restrictions contained herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated. The Company, the Guarantor and the Initial Purchasers shall endeavor in good faith
negotiations to replace the invalid, void or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, void or unenforceable provisions. 
  

 23 

 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

  
 Very truly yours, 
  

			
	AMÉRICA MÓVIL, S.A. de C.V.
		
	By:	 	 /s/    CARLOS GARCÍA
MORENO

	 	 	Name: Carlos García Moreno
	 	 	Title: Attorney-in-Fact

  

			
		
	By:	 	 /s/    ALEJANDRO CANTÚ
JIMÉNEZ

	 	 	Name: Alejandro Cantú Jiménez
	 	 	Title: Attorney-in-Fact

  

			
	RADIOMÓVIL DIPSA, S.A. de C.V.
		
	By:	 	 /s/    CARLOS GARCÍA
MORENO

	 	 	Name: Carlos García Moreno
	 	 	Title: Attorney-in-Fact

  

			
		
	By:	 	 /s/    ALEJANDRO CANTÚ
JIMÉNEZ

	 	 	Name: Alejandro Cantú Jiménez
	 	 	Title: Attorney-in-Fact

  

			
	CITIGROUP GLOBAL MARKETS INC.
		
	By:	 	 /s/    JOHN HARTZELL

	 	 	Name: John Hartzell
	 	 	Title: Managing Director

  

			
	CREDIT SUISSE FIRST BOSTON LLC
		
	By:	 	 /s/    HELENA M. WILLNER

	 	 	Name: Helena M. Willner
	 	 	Title: Director

  

 24EXHIBIT 10.2   2004 NON-QUALIFIED STOCK COMPENSATION PLAN

                   2004 NON-QUALIFIED STOCK COMPENSATION PLAN

1.   PURPOSE  OF  PLAN

     1.1  This  2004  NON-QUALIFIED  STOCK  COMPENSATION  PLAN  (the  "Plan")
ofPingchuan  Pharmaceutical,  Inc.,  a  North  Carolina  corporation  (the
"Company"),for  employees,  directors,  officers consultants, advisors and other
persons  associated  with the Company, is intended to advance the best interests
of  the Company by providing those persons who have a substantial responsibility
for  its management and growth with additional incentive and by increasing their
proprietary  interest in the success of the Company, thereby encouraging them to
maintain  their  relationships  with  the Company. Further, the availability and
offering of stock options and common stock under the Plan supports and increases
the  Company's  ability  to attract and retain individuals of exceptional talent
upon whom, in large measure, the sustained progress, growth and profitability of
the  Company  depends.

2.   DEFINITIONS

     2.1     For  Plan purposes, except where the context might clearly indicate
otherwise,  the  following  terms  shall  have  the  meanings  set  forth below:

    "Board"  shall  mean  the  Board  of  Directors  of  the  Company.

    "Committee"  shall mean the Compensation Committee, or such other committee
appointed by the Board, which shall be designated by the Board to administer the
Plan,  or the Board if no committees have been established.  The Committee shall
be composed of three or more persons as from time to time are appointed to serve
by  the  Board.  Each member of the Committee, while serving as such, shall be a
disinterested  person  with  the  meaning  of  Rule  16b-3 promulgated under the
Securities  Exchange  Act  of  1934.

     "Common Shares" shall mean the Company's Common Shares, $.001 par value per
share, or, in the event that the outstanding Common Shares are hereafter changed
into  or exchanged for different shares of securities of the Company, such other
shares  or  securities.

     "Company"  shall  mean  Pingchuan  Pharmaceutical,  Inc.,  a North Carolina
corporation,  and  any  parent  or  subsidiary  corporation  of  Pingchuan
Pharmaceutical,  Inc.,  as such terms are defined in Sections 425(e) and 425(f),
respectively,  of  the  Code.

     "Fair  Market  Value"  shall  mean,  with respect to the date a given stock
option  is  granted or exercised, the average of the highest and lowest reported
sales  prices  of  the  Common Shares, as reported by such responsible reporting
service  as  the  Committee may select, or if there were not transactions in the
Common  Shares  on  such  day, then the last preceding day on which transactions
took place.  The above withstanding, the Committee may determine the Fair Market
Value in such other manner as it may deem more equitable for Plan purposes or as
is  required  by  applicable  laws  or  regulations.

     "Optionee"  shall  mean an employee of the company who has been granted one
or  more  Stock  Options  under  the  Plan.

     "Common  Stock"  shall  mean shares of common stock which are issued by the
Company  pursuant  to  Section  5,  below.

     "Common  Stockholder"  means the employee of, consultant to, or director of
the  Company  or other person to whom shares of Common Stock are issued pursuant
to  this  Plan.

     "Common  Stock  Agreement"  means  an  agreement  executed  by  a  Common
Stockholder  and  the Company as contemplated by Section 5, below, which imposes
on  the  shares of Common Stock held by the Common Stockholder such restrictions
as  the  Board  or  Committee  deem  appropriate.

     "Stock Option" or "Non-Qualified Stock Option" or "NQSO" shall mean a stock
option  granted  pursuant  to  the  terms  of  the  Plan.

     "Stock  Option  Agreement" shall mean the agreement between the Company and
the  Optionee  under  which  the  Optionee may purchase Common Shares hereunder.

3.   ADMINISTRATION  OF  THE  PLAN

     3.1  The Committee shall administer the Plan and accordingly, it shall have
full  power  to grant Stock Options and Common Stock, construe and interpret the
Plan,  establish rules and regulations and perform all other acts, including the
delegation  of  administrative  responsibilities,  it  believes  reasonable  and
proper.

     3.2 The determination of those eligible to receive Stock Options and Common
Stock,  and  the  amount,  type  and  timing  of  each  grant  and the terms and
conditions of the respective stock option agreements and Common Stock Agreements
shall rest in the sole discretion of the Committee, subject to the provisions of
the  Plan.

     3.3 The Committee may cancel any Stock Options awarded under the Plan if an
Optionee  conducts  himself  in  a  manner  which the Committee determines to be
inimical  to  the  best  interest  of  the  Company,  as set forth more fully in
paragraph  8  of  Article  11  of  the  Plan.

     3.4  The  Board,  or  the  Committee,  may  correct  any defect, supply any
omission  or  reconcile  any  inconsistency in the Plan, or in any granted Stock
Option, in the manner and to the extent it shall deem necessary to carry it into
effect.

     3.5  Any  decision  made,  or  action  taken, by the Committee or the Board
arising  out  of  or in connection with the interpretation and administration of
the  Plan  shall  be  final  and  conclusive.

<PAGE>
     3.6  Meetings  of  the  Committee shall be held at such times and places as
shall be determined by the Committee. A majority of the members of the Committee
shall  constitute  a  quorum  for the transaction of business, and the vote of a
majority  of  those  members  present  at  any meeting shall decide any question
brought  before  that  meeting.  In  addition, the Committee may take any action
otherwise  proper  under  the  Plan  by  the  affirmative  vote, taken without a
meeting,  of  a  majority  of  its  members.

     3.7  No  member of the Committee shall be liable for any act or omission of
any  other  member  of the Committee or for any act or omission on his own part,
including,  but not limited to, the exercise of any power or discretion given to
him  under  the  Plan,  except  those resulting from his own gross negligence or
willful  misconduct.

     3.8  The  Company,  through  its  management,  shall supply full and timely
information  to  the  Committee  on  all  matters relating to the eligibility of
Optionees,  their  duties  and  performance,  and  current  information  on  any
Optionee's  death,  retirement,  disability  or other termination of association
with  the  Company,  and  such  other pertinent information as the Committee may
require.  The  Company  shall furnish the Committee with such clerical and other
assistance  as  is  necessary  in  the  performance  of  its  duties  hereunder.

4.     SHARES  SUBJECT  TO  THE  PLAN

     4.1 The total number of shares of the Company available for grants of Stock
Options  and  Common  Stock  under  the  Plan  shall be 3,000,000 Common Shares,
subject to adjustment in accordance with Article 7 of the Plan, which shares may
be  either  authorized  but unissued or reacquired Common Shares of the Company.

     4.2  If a Stock Option or portion thereof shall expire or terminate for any
reason  without having been exercised in full, the unpurchased shares covered by
such  NQSO  shall  be  available  for  future  grants  of  Stock  Options.

5.     AWARD  OF  COMMON  STOCK

     5.1  The  Board or Committee from time to time, in its absolute discretion,
may (a) award Common Stock to employees of, consultants to, and directors of the
Company,  and  such  other persons as the Board or Committee may select, and (b)
permit Holders of Options to exercise such Options prior to full vesting therein
and  hold  the Common Shares issued upon exercise of the Option as Common Stock.
In  either  such  event,  the  owner  of such Common Stock shall hold such stock
subject  to  such  vesting schedule as the Board or Committee may impose or such
vesting  schedule  to  which  the  Option  was  subject,  as  determined  in the
discretion  of  the  Board  or  Committee.

     5.2 Common Stock shall be issued only pursuant to a Common Stock Agreement,
which  shall  be  executed  by  the Common Stockholder and the Company and which
shall  contain  such  terms  and  conditions  as  the  Board  or Committee shall
determine  consistent with this Plan, including such restrictions on transfer as
are  imposed  by  the  Common  Stock  Agreement.

     5.3  Upon delivery of the shares of Common Stock to the Common Stockholder,
below, the Common Stockholder shall have, unless otherwise provided by the Board
or  Committee,  all  the  rights  of  a stockholder with respect to said shares,
subject  to  the restrictions in the Common Stock Agreement, including the right
to  receive  all  dividends and other distributions paid or made with respect to
the  Common  Stock.

     5.4. Notwithstanding anything in this Plan or any Common Stock Agreement to
the  contrary, no Common Stockholders may sell or otherwise transfer, whether or
not  for  value,  any  of the Common Stock prior to the date on which the Common
Stockholder  is  vested  therein.

     5.5 All shares of Common Stock issued under this Plan (including any shares
of Common Stock and other securities issued with respect to the shares of Common
Stock  as  a  result  of stock dividends, stock splits or similar changes in the
capital  structure  of the Company) shall be subject to such restrictions as the
Board  or  Committee  shall  provide,  which  restrictions  may include, without
limitation, restrictions concerning voting rights, transferability of the Common
Stock and restrictions based on duration of employment with the Company, Company
performance  and  individual  performance;  provided that the Board or Committee
may,  on such terms and conditions as it may determine to be appropriate, remove
any  or  all  of  such restric-tions. Common Stock may not be sold or encumbered
until  all  applicable restrictions have terminated or expire. The restrictions,
if any, imposed by the Board or Committee or the Board under this Section 5 need
not  be  identical  for  all Common Stock and the imposition of any restrictions
with respect to any Common Stock shall not require the imposition of the same or
any  other  restrictions  with  respect  to  any  other  Common  Stock.

     5.6  Each  Common Stock Agreement shall provide that the Company shall have
the  right  to  repurchase from the Common Stockholder the unvested Common Stock
upon  a termination of employment, termination of directorship or termination of
a consultancy arrangement, as applicable, at a cash price per share equal to the
purchase  price  paid  by  the  Common  Stockholder  for  such  Common  Stock.

     5.7 In the discretion of the Board or Committee, the Common Stock Agreement
may  provide  that  the  Company  shall  have  the a right of first refusal with
respect  to  the  Common Stock and a right to repurchase the vested Common Stock
upon  a termination of the Common Stockholder's employment with the Company, the
termination of the Common Stockholder's consulting arrangement with the Company,
the  termination  of the Common Stockholder's service on the Company's Board, or
such  other  events  as  the  Board  or  Committee  may  deem  appropriate.

     5.8  The Board or Committee shall cause a legend or legends to be placed on
certificates  representing  shares  of  Common  Stock  that  are  subject  to
restrictions  under  Common Stock Agreements, which legend or legends shall make
appropriate  reference  to  the  applicable  restrictions.

6.     STOCK  OPTION  TERMS  AND  CONDITIONS

     6.1  Consistent  with  the  Plan's purpose, Stock Options may be granted to
non-employee directors of the Company or other persons who are performing or who
have  been  engaged to perform services of special importance to the management,
operation  or  development  of  the  Company.

     6.2  All  Stock  Options  granted  under  the  Plan  shall  be evidenced by
agreements which shall be subject to applicable provisions of the Plan, and such
other  provisions as the Committee may adopt, including the provisions set forth
in  paragraphs  2  through  11  of  this  Section  6.

     6.3  All  Stock  Options granted hereunder must be granted within ten years
from  the  earlier  of  the  date  of  this  Plan  is adopted or approved by the
Company's  shareholders.

     6.4  No  Stock  Option  granted to any employee or 10% Shareholder shall be
exercisable  after  the  expiration  of  ten  years  from  the date such NQSO is
granted.  The  Committee, in its discretion, may provide that an Option shall be
exercisable  during  such  ten  year period or during any lesser period of time.

          The  Committee  may  establish  installment exercise terms for a Stock
Option  such  that  the NQSO becomes fully exercisable in a series of cumulating
portions.  If  an  Optionee shall not, in any given installment period, purchase
all  the  Common  Shares which such Optionee is entitled to purchase within such
installment  period,  such  Optionee's  right  to purchase any Common Shares not
purchased  in  such  installment  period  shall continue until the expiration or
sooner termination of such NQSO.  The Committee may also accelerate the exercise
of any NQSO.  However, no NQSO, or any portion thereof, may be exercisable until
thirty  (30)  days  following  date  of  grant  ("30-Day  Holding  Period.").

     6.5  A  Stock Option, or portion thereof, shall be exercised by delivery of
(i)  a written notice of exercise of the Company specifying the number of common
shares  to  be  purchased,  and  (ii)  payment  of the full price of such Common
Shares,  as  fully  set  forth  in  paragraph  6  of  this  Section  6.

          No  NQSO  or  installment  thereof  shall  be  exercisable except with
respect  to  whole  shares, and fractional share interests shall be disregarded.
Not  less  than 100 Common Shares may be purchased at one time unless the number
purchased is the total number at the time available for purchase under the NQSO.
Until  the  Common  Shares  represented  by  an  exercised NQSO are issued to an
Optionee,  he  shall  have  none  of  the  rights  of  a  shareholder.

     6.6  The exercise price of a Stock Option, or portion thereof, may be paid:

          A.   In  United  States  dollars,  in  cash  or  by  cashier's  check,
               certified  check, bank draft or money order, payable to the order
               of  the  Company  in  an  amount  equal  to  the option price; or

          B.   At the discretion of the Committee, through the delivery of fully
               paid  and  nonassessable  Common  Shares,  with an aggregate Fair
               Market  Value  on  the  date  the  NQSO is exercised equal to the
               option  price,  provided  such tendered Shares have been owned by
               the  Optionee  for  at  least one year prior to such exercise; or

          C.   By  a  combination  of  both  A  and  B  above.

          The  Committee shall determine acceptable methods for tendering Common
Shares  as  payment  upon  exercise  of  a  Stock  Option  and  may  impose such
limitations  and prohibitions on the use of Common Shares to exercise an NQSO as
it  deems  appropriate.

     6.7  With the Optionee's consent, the Committee may cancel any Stock Option
issued  under  this  Plan  and  issue  a  new  NQSO  to  such  Optionee.

     6.8  Except  by  will  or the laws of descent and distribution, no right or
interest  in  any  Stock  Option  granted  under the Plan shall be assignable or
transferable,  and  no right or interest of any Optionee shall be liable for, or
subject  to,  any  lien,  obligation or liability of the Optionee. Stock Options
shall  be exercisable during the Optionee's lifetime only by the Optionee or the
duly  appointed  legal  representative  of  an  incompetent  Optionee.

     6.9  If  the Optionee shall die while associated with the Company or within
three  months after termination of such association, the personal representative
or  administrator  of  the  Optionee's  estate  or the person(s) to whom an NQSO
granted  hereunder  shall  have  been  validly  transferred  by  such  personal
representative  or  administrator pursuant to the Optionee's will or the laws of
descent and distribution, shall have the right to exercise the NQSO for one year
after  the  date  of  the  Optionee's  death,  to  the  extent (i) such NQSO was
exercisable  on  the  date  of such termination of employment by death, and (ii)
such  NQSO  was not exercised, and (iii) the exercise period may not be extended
beyond  the  expiration  of  the  term  of  the  Option.

          No  transfer  of  a  Stock Option by the will of an Optionee or by the
laws  of  descent and distribution shall be effective to bind the Company unless
the  Company  shall  have  been  furnished  with  written  notice thereof and an
authenticated  copy  of the will and/or such other evidence as the Committee may
deem  necessary  to establish the validity of the transfer and the acceptance by
the  transferee  or transferee of the terms and conditions by such Stock Option.

          In  the  event  of  death  following  termination  of  the  Optionee's
association  with  the Company while any portion of an NQSO remains exercisable,
the  Committee,  in its discretion, may provide for an extension of the exercise
period  of  up  to  one  year  after  the  Optionee's  death  but not beyond the
expiration  of  the  term  of  the  Stock  Option.

     6.10 Any Optionee who disposes of Common Shares acquired on the exercise of
a  NQSO  by  sale  or exchange either (i) within two years after the date of the
grant  of  the  NQSO under which the stock was acquired, or (ii) within one year
after  the  acquisition  of  such  Shares,  shall  notify  the  Company  of such
disposition  and  of  the amount realized upon such disposition. The transfer of
Common  Shares may also be Common by applicable provisions of the Securities Act
of  1933,  as  amended.

7.     ADJUSTMENTS  OR  CHANGES  IN  CAPITALIZATION

     7.1  In  the  event  that  the outstanding Common Shares of the Company are
hereafter  changed into or exchanged for a different number or kind of shares or
other  securities  of  the  Company  by  reason  of merger, consolidation, other
reorganization, recapitalization, reclassification, combination of shares, stock
split-up  or  stock  dividend:

          A.   Prompt,  proportionate, equitable, lawful and adequate adjustment
               shall  be made of the aggregate number and kind of shares subject
               to  Stock  Options which may be granted under the Plan, such that
               the  Optionee shall have the right to purchase such Common Shares
               as may be issued in exchange for the Common Shares purchasable on
               exercise  of  the  NQSO  had  such  merger,  consolidation, other
               reorganization,  recapitalization,  reclassification, combination
               of  shares,  stock  split-up  or  stock dividend not taken place;

          B.   Rights  under  unexercised  Stock  Options  or  portions  thereof
               granted  prior  to any such change, both as to the number or kind
               of  shares  and  the  exercise price per share, shall be adjusted
               appropriately,  provided  that  such  adjustments  shall  be made
               without  change  in  the  total  exercise price applicable to the
               unexercised  portion  of  such NQSO's but by an adjustment in the
               price  for  each  share  covered  by  such  NQSO's;  or

          C.   Upon  any dissolution or liquidation of the Company or any merger
               or  combination  in  which  the  Company  is  not  a  surviving
               corporation,  each  outstanding  Stock  Option  granted hereunder
               shall  terminate,  but  the  Optionee  shall  have  the  right,
               immediately  prior  to  such  dissolution, liquidation, merger or
               combination,  to  exercise  his  NQSO in whole or in part, to the
               extent  that  it shall not have been exercised, without regard to
               any  installment  exercise  provisions  in  such  NQSO.

     7.2  The  foregoing  adjustments  and  the  manner  of  application  of the
foregoing  provisions  shall  be  determined  solely  by  the  Committee,  whose
determination as to what adjustments shall be made and the extent thereof, shall
be final, binding and conclusive. No fractional Shares shall be issued under the
Plan  on  account  of  any  such  adjustments.

8.     MERGER,  CONSOLIDATION  OR  TENDER  OFFER

     8.1  If  the Company shall be a party to a binding agreement to any merger,
consolidation  or  reorganization or sale of substantially all the assets of the
Company, each outstanding Stock Option shall pertain and apply to the securities
and/or  property  which  a  shareholder  of  the  number of Common Shares of the
Company  subject  to  the  NQSO  would  be  entitled to receive pursuant to such
merger,  consolidation  or  reorganization  or  sale  of  assets.

     8.2  In  the  event  that:

          A.   Any  person other than the Company shall acquire more than 20% of
               the Common Shares of the Company through a tender offer, exchange
               offer  or  otherwise;

          B.   A  change in the "control" of the Company occurs, as such term is
               defined  in  Rule  405  under  the  Securities  Act  of  1933;

          C.   There  shall  be a sale of all or substantially all of the assets
               of  the  Company;

any  then  outstanding  Stock  Option  held by an Optionee, who is deemed by the
Committee  to  be  a statutory officer ("Insider") for purposes of Section 16 of
the Securities Exchange Act of 1934 shall be entitled to receive, subject to any
action  by  the Committee revoking such an entitlement as provided for below, in
lieu  of  exercise  of  such  Stock  Option,  to  the  extent  that  it  is then
exercisable,  a  cash  payment  in an amount equal to the difference between the
aggregate  exercise  price  of  such  NQSO, or portion thereof, and, (i)  in the
event  of  an  offer  or similar event, the final offer price per share paid for
Common  Shares, or such lower price as the Committee may determine to conform an
option  to  preserve  its Stock Option status, times the number of Common Shares
covered by the NQSO or portion thereof, or (ii)  in the case of an event covered
by B or C above, the aggregate Fair Market Value of the Common Shares covered by
the  Stock  Option,  as  determined  by  the  Committee  at  such  time.

     8.3 Any payment which the Company is required to make pursuant to paragraph
8.2 of this Section 8 shall be made within 15 business days, following the event
which  results in the Optionee's right to such payment. In the event of a tender
offer  in  which  fewer  than  all  the  shares  which  are  validly tendered in
compliance with such offer are purchased or exchanged, then only that portion of
the  shares  covered  by  an  NQSO  as results from multiplying such shares by a
fraction,  the  numerator  of  which  is  the  number  of Common Shares acquired
pursuant  to  the  offer  and  the  denominator of which is the number of Common
Shares  tendered  in  compliance  with such offer shall be used to determine the
payment thereupon. To the extent that all or any portion of a Stock Option shall
be  affected  by  this  provision,  all  or  such  portion  of the NQSO shall be
terminated.

     8.4 Notwithstanding paragraphs 8.1 and 8.3 of this Section 8, the Committee
may,  by  unanimous vote and resolution, unilaterally revoke the benefits of the
above  provisions;  provided, however, that such vote is taken no later than ten
business  days  following  public  announcement of the intent of an offer or the
change  of  control,  whichever  occurs  earlier.

9.     AMENDMENT  AND  TERMINATION  OF  PLAN

     9.1  The Board may at any time, and from time to time, suspend or terminate
the  Plan  in whole or in part or amend it from time to time in such respects as
the  Board  may  deem  appropriate  and  in  the  best  interest of the Company.

     9.2 No amendment, suspension or termination of this Plan shall, without the
Optionee's  consent,  alter or impair any of the rights or obligations under any
Stock  Option  theretofore  granted  to  him  under  the  Plan.

     9.3  The  Board may amend the Plan, subject to the limitations cited above,
in  such  manner  as  it deems necessary to permit the granting of Stock Options
meeting  the requirements of future amendments or issued regulations, if any, to
the  Code.

     9.4  No  NQSO  may  be  granted  during any suspension of the Plan or after
termination  of  the  Plan.

10.     GOVERNMENT  AND  OTHER  REGULATIONS

     10.1  The  obligation  of the Company to issue, transfer and deliver Common
Shares  for  Stock  Options  exercised  under  the  Plan shall be subject to all
applicable  laws, regulations, rules, orders and approval which shall then be in
effect  and  required by the relevant stock exchanges on which the Common Shares
are  traded and by government entities as set forth below or as the Committee in
its  sole  discretion  shall  deem  necessary  or  advisable.  Specifically,  in
connection  with  the  Securities  Act of 1933, as amended, upon exercise of any
Stock  Option,  the  Company shall not be required to issue Common Shares unless
the  Committee  has  received evidence satisfactory to it to the effect that the
Optionee  will  not  transfer  such  shares  except  pursuant  to a registration
statement  in effect under such Act or unless an opinion of counsel satisfactory
to  the  Company  has  been  received  by  the  Company  to the effect that such
registration  is  not  required.  Any  determination  in  this connection by the
Committee  shall be final, binding and conclusive. The Company may, but shall in
no  event  be  obligated to, take any other affirmative action in order to cause
the exercise of a Stock Option or the issuance of Common Shares pursuant thereto
to  comply  with  any  law  or  regulation  of  any  government  authority.

11.     MISCELLANEOUS  PROVISIONS

     11.1  No  person shall have any claim or right to be granted a Stock Option
or  Common  Stock under the Plan, and the grant of an NQSO or Common Stock under
the  Plan shall not be construed as giving an Optionee or Common Stockholder the
right to be retained by the Company. Furthermore, the Company expressly reserves
the  right  at  any  time to terminate its relationship with an Optionee with or
without  cause,  free from any liability, or any claim under the Plan, except as
provided herein, in an option agreement, or in any agreement between the Company
and  the  Optionee.

     11.2 Any expenses of administering this Plan shall be borne by the Company.

     11.3  The payment received from Optionee from the exercise of Stock Options
under  the Plan shall be used for the general corporate purposes of the Company.

     11.4 The place of administration of the Plan shall be in the State of North
Carolina,  and  the  validity,  construction, interpretation, administration and
effect  of the Plan and of its rules and regulations, and rights relating to the
Plan,  shall  be  determined  solely in accordance with the laws of the State of
North  Carolina.

     11.5  Without  amending  the  Plan,  grants  may be made to persons who are
foreign  nationals or employed outside the United States, or both, on such terms
and  conditions,  consistent  with  the  Plan's  purpose,  different  from those
specified  in the Plan as may, in the judgment of the Committee, be necessary or
desirable  to  create  equitable  opportunities given differences in tax laws in
other  countries.

     11.6  In  addition to such other rights of indemnification as they may have
as  members of the Board or the Committee, the members of the Committee shall be
indemnified by the Company against all costs and expenses reasonably incurred by
them  in  connection with any action, suit or proceeding to which they or any of
them  may  be  party by reason of any action taken or failure to act under or in
connection with the Plan or any Stock Option granted thereunder, and against all
amounts paid by them in settlement thereof (provided such settlement is approved
by  independent  legal  counsel  selected  by  the  Company)  or paid by them in
satisfaction  of  a  judgment  in  any such action, suit or proceeding, except a
judgment  based  upon a finding of bad faith; provided that upon the institution
of  any  such  action,  suit or proceeding a Committee member shall, in writing,
give  the  Company  notice  thereof  and  an opportunity, at its own expense, to
handle and defend the same, with counsel acceptable to the Optionee, before such
Committee  member  undertakes  to  handle  and  defend  it  on  his  own behalf.

     11.7  Stock  Options  may  be granted under this Plan from time to time, in
substitution  for  stock options held by employees of other corporations who are
about  to  become  employees  of  the  Company  as  the  result  of  a merger or
consolidation  of  the employing corporation with the Company or the acquisition
by  the Company of the assets of the employing corporation or the acquisition by
the  Company  of  stock  of  the  employing  corporation as a result of which it
becomes a subsidiary of the Company. The terms and conditions of such substitute
stock  options  so  granted  may vary from the terms and conditions set forth in
this Plan to such extent as the Board of Directors of the Company at the time of
grant may deem appropriate to conform, in whole or in part, to the provisions of
the  stock  options  in  substitution  for  which  they are granted, but no such
variations  shall  be  such as to affect the status of any such substitute stock
options  as  a  stock  option  under  Section  422A  of  the  Code.

     11.8 Notwithstanding anything to the contrary in the Plan, if the Committee
finds  by  a  majority  vote, after full consideration of the facts presented on
behalf  of both the Company and the Optionee, that the Optionee has been engaged
in  fraud,  embezzlement,  theft,  insider  trading  in  the  Company's  stock,
commission  of  a  felony  or proven dishonesty in the course of his association
with  the Company or any subsidiary corporation which damaged the Company or any
subsidiary  corporation,  or  for disclosing trade secrets of the Company or any
subsidiary corporation, the Optionee shall forfeit all unexercised Stock Options
and  all  exercised  NQSO's  under  which  the Company has not yet delivered the
certificates  and  which  have  been  earlier  granted  to  the  Optionee by the
Committee.  The  decision  of  the  Committee  as  to the cause of an Optionee's
discharge  and the damage done to the Company shall be final. No decision of the
Committee,  however, shall affect the finality of the discharge of such Optionee
by  the  Company  or  any  subsidiary  corporation  in  any  manner.

12.     WRITTEN  AGREEMENT

     12.1  Each  Stock  Option  granted hereunder shall be embodied in a written
Stock  Option  Agreement  which  shall  be  subject  to the terms and conditions
prescribed above and shall be signed by the Optionee and by the President or any
Vice President of the Company, for and in the name and on behalf of the Company.
Such  Stock  Option  Agreement  shall  contain  such  other  provisions  as  the
Committee,  in  its  discretion  shall  deem  advisable.

<PAGE>
Number  of  Shares:___________                                  Date  of  Grant:

     FORM  OF  NON-QUALIFIED  STOCK  OPTION  AGREEMENT

     AGREEMENT  made  this___ day  of__________ 200,  between_______
    (the  "Optionee"),  and  Pingchuan  Pharmaceutical,  Inc., (the  "Company").

     1.  GRANT  OF  OPTION

     The  Company,  pursuant  to  the  provisions  of  the  Non-Qualified  Stock
Compensation Plan (the "Plan"), adopted by the Board of Directors on_____, 2004,
the  Company  hereby grants to the Optionee, subject to the terms and conditions
set  forth or incorporated herein, an option to purchase from the Company all or
any  part of an aggregate of______shares of its $.001 par value common stock, as
such  common  stock  is now constituted, at the purchase price of $___per share.
The  provisions  of  the  Plan  governing the terms and conditions of the Option
granted  hereby  are  incorporated  in  full  herein  by  reference.

     2.  EXERCISE

          The  Option  evidenced hereby shall be exercisable in whole or in part
on  or  after _____and  on or before____________ , provided that the
cumulative  number  of  shares  of  common  stock as to which this Option may be
exercised  (except  in  the  event  of death, retirement, or permanent and total
disability,  as  provided  in  paragraph  6.9  of the Plan) shall not exceed the
following  amounts:

     Cumulative  Number              Prior  to  Date
        of  Shares               (Note  Inclusive  of)
     -----------------           ---------------------

The  Option evidenced hereby shall be exercisable by the delivery to and receipt
by  the  Company of (i)  written notice of election to exercise, in the form set
forth  in  Attachment B hereto, specifying the number of shares to be purchased;
(ii)  accompanied  by  payment  of  the  full  purchase price thereof in cash or
certified  check  payable  to  the  order  of  the Company, or by fully paid and
nonassessable common stock of the Company properly endorsed over to the Company,
or  by  a  combination  thereof,  and  (iii)  by  return  of  this  Stock Option
Agreement  for  endorsement of exercise by the Company on Schedule I hereof.  In
the  event  fully  paid  and nonassessable common stock is submitted as whole or
partial  payment for shares to be purchased hereunder, such common stock will be
valued  at  their  Fair  Market  Value (as defined in the Plan) on the date such
shares  received  by  the  Company are applied to payment of the exercise price.

<PAGE>
     3.     TRANSFERABILITY

     The  Option  evidenced  hereby  is  not  assignable  or transferable by the
Optionee  other  than  by  the  Optionee's  will  or  by the laws of descent and
distribution,  as  provided  in  paragraph  6.9 of the Plan. The Option shall be
exercisable  only  by  the  Optionee  during  his  lifetime.

                                       Pingchuan  Pharmaceutical,  Inc.

                                       By:
                                       Name:
ATTEST:                                Title:

_____________________________________
Secretary

     Optionee hereby acknowledges receipt of a copy of the Plan, attached hereto
and  accepts  this  Option  subject to each and every term and provision of such
Plan.  Optionee  hereby  agrees  to accept as binding, conclusive and final, all
decisions  or interpretations of the of the Board of Directors administering the
Plan  on  any  questions  arising  under such Plan.  Optionee recognizes that if
Optionee's  employment  with  the  Company  or  any  subsidiary thereof shall be
terminated  without  cause,  or  by  the  Optionee,  prior  to  completion  or
satisfactory  performance by Optionee (except as otherwise provided in paragraph
6 of the Plan) all of the Optionee's rights hereunder shall thereupon terminate;
and  that, pursuant to paragraph 6 of the Plan, this Option may not be exercised
while  there  is outstanding to Optionee any unexercised Stock Option granted to
Optionee  before  the  date  of  grant  of  this  Option.

Dated:_________                                     ____________________________
                                                    Optionee

                                                   _____________________________
                                                   Print  Name

                                                   _____________________________
                                                   Address

                                                   _____________________________
                                                   Social  Security  No.

<PAGE>

ATTACHMENT  B

                                  NOTICE OF EXERCISE

To:     Pingchuan  Pharmaceutical,  Inc.,

(1)     The  undersigned  hereby  elects  to  purchase ________ shares of Common
Shares (the "Common Shares"), of Pingchuan Pharmaceutical, Inc., pursuant to the
     terms  of  the  attached  Non-Qualified Stock Option Agreement, and tenders
herewith  payment  of  the  exercise price in full, together with all applicable
transfer  taxes,  if  any.

(2)     Please  issue  a certificate or certificates representing said shares of
Common  Shares  in  the  name  of  the  undersigned  or in such other name as is
specified  below:

               _______________________________
               (Name)

               _______________________________
               (Address)
               _______________________________

Dated:

                                                  ______________________________
                                                      Signature

Optionee:_____________________          _______________________Date  of  Grant:

<PAGE>

<TABLE>
<CAPTION>
                                     SCHEDULE  I

DATE       SHARES  PURCHASED        PAYMENT          UNEXERCISED       ISSUING
                                    RECEIVED           SHARES          OFFICER
                                                      REMAINING        INITIALS
-------------------------------------------------------------------------------
<S>         <C>                   <C>               <C>               <C>
</TABLE>

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