Mexico - Second Small & Med. Scale Industry Dev. Project : Loan 1881 - Loan Agreement - Conformed

LOAN NUMBER 1881 ME Loan Agreement (Second Small- and Medium-Scale Industry Development Project) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and NACIONAL FINANCIERA, S. A. Dated , 1980 LOAN NUMBER 1881 ME LOAN AGREEMENT AGREEMENT, dated -J), 1980, between INTERNATIONAL BANK FOR RECONSTRUCTO AND DEVELOPMENT (hereinafter called the Bank) and NACIONAL FINANCIERA, S. A. (hereinafter called the Borrower). ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Loan and Guarantee Agreements of the Bank dated March 15, 1974, with the same force and effect as if they were fully set forth herein, subject, however, to the modifications thereof set forth in Schedule 2 to this Agreement (said General Conditions Applicable to Loan and Guarantee Agreements of the Bank, as so modified, being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth, and the following additional terms have the following meanings: (a) "FOGAIN" means Fondo de Garantia y Fomento a la Indus- tria Mediana y Pequeria, established by a law of the Guarantor published in the Diario Oficial on December 30, 1953 of which the Borrower is the Trustee pursuant to a contrato de fideicomiso between the Guarantor and the Borrower dated April 7, 1954, as amended; and such term includes the technical and administrative organization, resources, staff and facilities used, or to be used, by the Borrower to operate FOGAIN. (b) "FOMIN" means Fondo Nacional de Fomento Industrial, established by a contrato de fideicomiso between the Guarantor and the Borrower dated April 12, 1972, as amended, and of which the Borrower is Trustee pursuant to said contrato; and such term includes the technical and administrative organization, resources, staff and facilities used, or to be used, by the Borrower to operate FOMIN. (c) "FIDEIN" means Fideicomiso de Conjuntos, Parques y Ciudades Industriales y Centros Comerciales, established by a law of the Guarantor published in the Diario Oficial on December 24, 1970 of which the Borrower is Trustee pursuant to a contrato -2- de fideicomiso between the Guarantor and the Borrower dated February 1, 1971, as amended; and such term includes the technical and administrative organization, resources, staff and facilities used, or to be used, by the Borrower to operate FIDEIN. (d) "Fideicomisos" means FOGAIN, FOMIN and FIDEIN. (e) "Participating Intermediary" means any public or private financial institution approved by FOGAIN. (f) "FOCAIN Loan" means a loan made by the Borrower as Trustee for FUGAIN to a Participating Intermediary to assist the latter in the financing of an Investment Project in accordance with the FOGAIN Operating Regulations, such loan to be relent to an Investment Enterprise and to be partially financed out of the proceeds of the Loan, and "FOGAIN Loan Agreement" means the agreement for the FOGAIN Loan. (g) "FIDEIN Loan" means a loan made by the Borrower as Trustee for FIDEIN to a Fideicomiso Especial or Arrendadora Internacional, S.A. or any other leasing agency to assist in the financing of an Investment Project under Part A (3) of the Project in accordance with the FIDEIN Operating Regulations, and to be partially financed out of the proceeds of the Loan; and "FIDEIN Loan Agreement" means the agreement for the FIDEIN Loan. (h) "FIDEIN Operation" means a FIDEIN Loan or an Investment Project carried out by FIDEIN, and "free-limit FIDEIN Operation" means a FIDEIN Operation, as so defined, which qualifies as a free-limit FIDEIN Operation pursuant to the provisions of Section 2.02 (c) (i) of this Agreement. (i) "Sub-loan" means a loan made or proposed to be made by a Participating Intermediary out of the proceeds of a FOGAIN Loan to an Investment Enterprise for an Investment Project. (j) "FOMIN Investment" means an investment made or proposed to be made by the Borrower as Trustee for FOMIN in an Investment Enterprise for an Investment Project in accordance with the FOMIN Operating Regulations and to be partially financed out of the proceeds of the Loan, and "free-limit FOMIN Investment" means a FOMIN Investment, as so defined, which qualifies as a free-limit FOMIN Investment pursuant to the provisions of Section 2.02 (c) (ii) of this Agreement. -3- (k) "Investment Enterprise" means (i) a small- or medium- scale industrial enterprise engaged in the production of goods or services to which a Participating Intermediary proposes to make or has made a sub-loan, or (ii) an industrial enterprise in which the Borrower as Trustee for FOMIN proposes to make or has made a FOMIN Investment, or (iii) a Fideicomiso Especial or Arrendadora International, S.A. or any other leasing entity to which the Borrower as Trustee for FIDEIN proposes to make or has made a FIDEIN Loan. (1) "Fideicomiso Especial" means a Fideicomiso established by the Guarantor for purposes of carrying out its industrial estates program. (m) "Investment Project" means a specific development project to be carried out by an Investment Enterprise or FIDEIN under Part A of the Project utilizing the proceeds of the Loan. (n) "Peso" means the currency unit of the Guarantor. (o) "Foreign currency" means any currency other than the currency of the Guarantor. (p) "FOGAIN Operating Regulations" means the operating regulations of FOGAIN dated April 6, 1954, as amended to the date of this Agreement. (q) "FOMIN Operating Regulations" means the operating regulations of FOMIN dated April 12, 1972, as amended to the date of this Agreement. (r) "FIDEIN Operating Regulations" means the operating regulations of FIDEIN dated April 27, 1976, as amended to the date of this Agreement. (s) "Operating Regulations" means the FOGAIN Operating Regulations, the FOMIN Operating Regulations and the FIDEIN Operating Regulations. (t) "Separate Account" means the account that the Borrower shall open in its books pursuant to Section 3.09 of this Agreement. (u) "Small- and Medium-scale industrial enterprises" means small- and medium-scale industrial enterprises as defined in the FOGAIN Operating Regulations. (v) "Prevailing interest rate" means an annual rate of interest which reflects the average cost of borrowed funds to the financial departments of multipurpose banks operating in Mexico as calculated monthly by Banco de Mexico, S.A. ARTICLE II The Loan Section 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions in the Loan Agreement set forth or referred to, an amount in various currencies equivalent to one hundred million dollars ($100,000,000). Section 2.02. (a) The amount of the Loan may be withdrawn from the Loan Account for: (i) 55% of amounts expended by the Borrower, as Trustee for the Fideicomisos, under a FOGAIN Loan or FOMIN Investment or FIDEIN Operation to meet the reason- able cost of fixed assets and permanent working capital related thereto required for the Investment Project in respect of which the withdrawal from the Loan Account is requested; provided, however, that (A) no withdrawal shall be made in respect of a FOGAIN Loan, FOMIN Investment or FIDEIN Operation unless (1) the Bank shall have authorized withdraw- als from the Loan Account for the FOGAIN Loan, or (2) the FIDEIN Operation or FOMIN Investment shall have been approved by the Bank, or (3) the FIDEIN Operation or FOMIN Investment shall be a free-limit FIDEIN Operation or free-limit FOMIN Investment for which the Bank shall have authorized withdrawals from the Loan Account; and (B) the percentage specified above shall not exceed the estimated aggregate foreign exchange cost of Part A of the Project; and (ii) (A) 100% of expenditures in foreign currency or 70% of expenditures in pesos made by the Borrower to meet the reasonable cost of imported goods and services required for Part C of the Project; and -5- (B) 25% of expenditures made by the Borrower to meet the reasonable cost of local goods and services required for Part C of the Project. (b) The proceeds of the Loan shall be allocated as follows: (i) $70,000,000 equivalent for FOGAIN Loans; (ii) $12,000,000 equivalent for FOMIN Investments; (iii) $8,000,000 equivalent for FIDEIN Operations; (iv) $8,000,000 equivalent for FOMIN Investments or FIDEIN Operations once the funds allocated under subparagraphs (ii) or (iii) above have been with- drawn from the Loan Account; and (v) $2,000,000 equivalent for Part C of the Project; the foregoing allocation of the proceeds of the Loan being subject to change from time to time as determined by the Bank after consultation with the Borrower. (c) Except as the Bank and the Borrower shall otherwise agree, (i) free-limit FIDEIN Operation shall be any FIDEIN Operation other than: (A) a FIDEIN Operation consisting of construction of factory buildings of an area of more than 2,400 square meters, or (B) a FIDEIN Operation consisting of construction of factory buildings in respect of which there is no sale, rent or lease contract, or (C) the first two FIDEIN Operations made under Part A (3) (ii) of the Project, or (D) the first two FIDEIN Operations made under Part A (3) (iii) of the Project; and (ii) free-limit FOMIN Investment shall be a FOMIN Investment for an Investment Project in an amount to be financed out of the proceeds of the Loan which shall not exceed the sum of $250,000 equiva- lent. -6- (d) Except as the Bank and the Borrower shall otherwise agree, no withdrawals shall be made on account of (i) expenditures made before the date of this Agreement, or (ii) expenditures made by an Investment Enterprise in respect of a FIDEIN Operation or FOMIN Investment subject to the Bank's approval if such expendi- tures shall have been made more than one hundred and eighty days prior to the date on which the Bank shall have received in respect of such FIDEIN Operation or FOMIN Investment the application and information required by Section 2.03 (a) of this Agreement or, in respect of a FOGAIN Loan, free-limit FIDEIN Operation or free- limit FOMIN Investment more than one hundred and eighty days prior to the date on which the Bank shall have received in respect of such FOGAIN Loan, free-limit FIDEIN Operation or free-limit FOMIN Investment the request and information required by Section 2.03 (b) of this Agreement, or (iii) expenditures in respect of Part A (1) or Part A (2) or Part A (3) of the Project unless the Borrower has entered into the contractual arrangements referred to in Section 3.02 (a) of this Agreement with FOGAIN or FIDEIN or FOMIN, respectively, and the Bank has been furnished with an opinion satisfactory to the Bank of counsel acceptable to the Bank showing that such contractual arrangements are legally binding upon the parties thereto. Section 2.03. (a) When presenting a FIDEIN Operation (other than a free-limit FIDEIN Operation) or FOMIN Investment (other than a free-limit FOMIN Investment) to the Bank for approval, the Borrower shall furnish to the Bank an application together with: (i) an appraisal of the Investment Project, including a summary description of the expenditures proposed to be partially financed out of the proceeds of the Loan, and, whenever applicable, a description of the Investment Enterprise; (ii) the proposed terms and conditions of the FOMIN Investment or, in the case of a FIDEIN Operation consisting of a FIDEIN Loan, the terms and condi- tions of such FIDEIN Loan; and (iii) such other information as the Bank shall reasonably request. (b) Each request by the Borrower for authorization to make withdrawals from the Loan Account in respect of a FOGAIN Loan, a free-limit FIDEIN Operation or a free-limit FOMIN Investment shall contain: (i) a summary description of the Investment Pro- ject, including a summary description of the expenditures proposed to be partially financed out of the proceeds of the Loan, and, whenever applicable, a summary description of the Investment Enterprise; (ii) the proposed terms and conditions of the FOGAIN Loan or free-limit FOMIN Investment or, in the case of a FIDEIN -7- Operation consisting of a FIDEIN Loan, the terms and conditions of such FIDEIN Loan; and (iii) such other information as the Bank shall reasonably request. (c) Except as the Bank and the Borrower shall otherwise agree, applications and requests made pursuant to the provisions of paragraphs (a) and (b) of this Section shall be presented to the Bank on or before December 31, 1983. Section 2.04. The Closing Date shall be December 31, 1984 or such later date as the Bank shall establish. The Bank shall promptly notify the Borrower and the Guarantor of such later date. Section 2.05. The Borrower shall pay to the Bank a commitment charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Loan not withdrawn from time to time. Section 2.06. The Borrower shall pay interest at the rate of eight and twenty-five hundredths per cent (8.25%) per annum on the principal amount of the Loan withdrawn and outstanding from time to time. Section 2.07. Interest and other charges shall be payable semiannually on June 1 and December 1 in each year. Section 2.08. The Borrower shall repay the principal amount of the Loan in accordance with the amortization schedule set forth in Schedule 1 to this Agreement. ARTICLE III The Project; Management and Operations of the Borrower Section 3.01. (a) The purpose of the Project is to assist the Borrower in financing such technical assistance and productive facilities and resources in Mexico as will contribute to the economic development of the country's small- and medium-scale industry. The Project consists of the following Parts: Part A: Financing of: (1) Investment Projects through FOGAIN Loans to Participat- ing Intermediaries for further relending to Investment -8- Enterprises; such Investment Projects to consist of establishment or expansion of productive capacity. (2) Investment Projects through FOMIN Investments in Invest- ment Enterprises; such Investment Projects to consist of establishment or expansion of productive capacity. (3) Investment Projects consisting of: (i) construction of factory buildings by FIDEIN or by a Fideicomiso Especial for purposes of leasing them with or without option to purchase or selling them on deferred terms to small- and medium-scale industrial enterprises; (ii) construction and equipping of common servic: facilities by FIDEIN or a Fideicomiso Especial to be used by small- and medium-scale industrial enterprises; or (iii) acquisition of industrial equipment by a leasing entity approved by FIDEIN for purposes of leasing it with or without option to purchase or selling it on deferred terms to small-and medium-scale indus- trial enterprises. Part B: Operation of a scheme to guarantee the repayment of the principal of sub-loans made by Participating Intermedi- aries to Investment Enterprises, including provision for an adequate reserve fund. Part C: A technical assistance program consisting of: recruit- ment and training of personnel; technical assistance to industrial enterprises by industrial extension agents and specialized agencies; acquisition and utilization of equipment, materials and services for this program; and technical and financial assistance to industrial enter- prises to carry out studies. (b) The Borrower as Trustee for the Fideicomisos and in its own capacity shall carry out the Project and conduct its opera- tions and affairs in accordance with sound financial standards and practices, with adequate personnel, and in accordance with the Operating Regulations and shall, at all times make available, promptly as needed, such funds and other resources as shall be required for the purpose. - 9 - Section 3.02. The Borrower shall: (a) transfer to the Fideicomisos' accounts, for purposes of Part A of the Project and under contractual arrangements satis- factory to the Bank, the equivalent in pesos at the time of withdrawal of each portion of the Loan withdrawn from the Loan Account. The Borrower shall not, acting in its own capacity or as Trustee for the Fideicomisos, change or fail to enforce any provision of such arrangements; and (b) use, as Trustee for the Fideicomisos, the amounts accruing to it from the carrying out of Part A of the Project and corresponding to the portion of FOGAIN Loans, FIDEIN Operations and FOMIN Investments financed out of the proceeds of the Loan for purposes similar to those of said Part of the Project. Section 3.03. Except as the Bank shall otherwise agree: (a) Interest on sub-loans shall be payable by the Invest- ment Enterprises at annual interest rates which, on the average, shall be equal to the average of the prevailing interest rates in effect during the twelve months preceding the date on which such rates are adjusted pursuant to the provisions of paragraph (b) of this Section plus at least one percentage point. (b) The Borrower shall adjust the rates of interest pay- able on sub-loans at least once a year to reflect, on the average, the change in the average of the prevailing interest rates in effect during the preceding twelve months in relation to the average prevailing interest rates used for purposes of the pre- vious adjustment. Section 3.04. The Borrower as Trustee for FOMIN shall charge on any FOMIN Investment consisting of subordinated debt or debt represented by instruments convertible into equity interest at an annual rate equal to at least the prevailing rate of interest in effect at the time such FOMIN Investment is made less three percentage points. Section 3.05. The Borrower as Trustee for FIDEIN shall require that the entities referred to in Part A (3) (i) and (iii) of the Project charge such fees on the facilities and equipment included in said Part of the Project and leased or sold on de- ferred terms as shall be required to recover at least the oper- ating expenses of such entities in respect of the Project, the - 10 - amounts expended to finance such facilities and equipment, and, on the average, the equivalent of an annual rate of interest on such amounts at least equal to the prevailing rate of interest in effect at the time such amounts were expended plus one percentage point. Section 3.06. The Borrower as Trustee for FOGAIN shall require that if a sub-loan or any part thereof shall be repaid to a Participating Intermediary in advance of mazurity, or if a sub-loan shall be sold, transferred, assigned or otherwise dis- posed of for value by a Participating Intermediary, stch Partici- pating Intermediary shall iepay promptly to the Borrower the amounts of the FOGAIN Loan corresponding to such sub-loan or parts thereof so repaid in advance or disposed of for value. Section 3.07. (a) The Borrower as Trustee for the Fideicomisos undertakes that, unless the Bank shall otherwise agree, a sub-loan or FIDEIN Loan, or FOMIN Investment will be made on terms whereby a Participating Intermediary or the Borrower shall obtain, by written contract with an Investment Enterprise or by other appropriate legal means, rights adequate to protect the interests of the Borrower and the Participating Intermediary, including, in the case of any sub-loan or FIDEIN Loan and to the extent that it shall be appropriate in the case of any FOMIN Investment, the right to: (i) require the Investment Enterprise to carry out and operate the Investment Project with due diligence and efficiency and in accordance with sound technical, financial and managerial standards and to maintain adequate records; (ii) require that (A) the goods and services to be financed out of the proceeds of the Loan shall be purchased at a reasonable price, account being taken also of other relevant factors such as time of delivery and efficiency and reliability of the goods and avail- ability of maintenance facilities and spare parts therefor, and, in the case of services, of their quality and the competence of the parties rendering them, and (B) such goods and services shall be used exclusively in the carrying our of the Investment Project; (iii) inspect, by itself or jointly with representatives of the Bank, if the Bank shall so request after consultation with the Borrower, such goods and the sites, works, plants and construction included in the Investment Project, the operation thereof, and any relevant records and documents; (iv) require that the Investment Enterprise shall take out and maintain with responsible insurers such insurance, against such risks and in such amounts, as shall be consistent with sound business practice; and that such insur- ance cover marine, transit and other hazards incident to the - 11 - acquisition, transportation and delivery of goods financed out of the proceedo of the Loan to the place of use or installation, and that any indemnity thereunder be made payable in a currency freely usable by the Investment Enterprise to replace or repair such goods; (v) obtain all such information as the Borrower or the Participating Intermediaries shall reasonably request relating to the foregoing and to the administration, operations and financial condition of the Investment Enterprise; and (vi) suspend or terminate the right of the Investment Enterprise to the use of the proceeds of the Loan upon failure by such Investment Enterprise to perform any of its obligations under its contract with the Parti- cipating Intermediary or the Borrower. (b) The Borrower shall exercise its rights, and cause the Participating Intermediary to exercise its rights, in relation to each Investment Project in such manner as to: (i) protect the interests of the Bank, the Borrower and the Participating Inter- mediary; (ii) comply with its obligations under the FOGAIN Loan Agreement or FIDEIN Loan Agreement; and (iii) achieve the purposes of the Project. Section 3.08. (a) The Borrower shall furnish to the Bank all such information as the Bank shall reasonably request concerning the Project, the Investment Enterprises, the Investment Projects, the FOGAIN Loans, the FIDEIN Operations, the sub-loans, and the FOMIN Investments. (b) The Borrower: (i) shall maintain or cause to be main- tained records and procedures adequate to record and monitor the progress of the Project, to identify the goods and services financed out of the proceeds of the Loan, and to disclose their use in the Project; and (ii) shall furnish to the Bank all such information as the Bank shall reasonably request concerning the Project, the expenditure of the proceeds of the Loan, and the goods and services financed out of such proceeds. (c) Promptly after completion of the Project, but in any event not later than one year after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, the Borrower shall prepare and furnish to the Bank a report on the execution and operation of the Project and its cost and benefits, and on the accomplishment of the purposes of the Loan. - 12 - Section 3.09. The Borrower shall: (a) establish and maintain, in its books, a Separate Account; and (b) record in the Separate Account: (i) the amounts trans- ferred to each of the Fideicomisos for purposes of Part A of the Project and pursuant to Section 3.02 (b) of this Agreement; and (ii) all receipts and payments for or in respect of Part C of the Project, in accordance with sound accounting practices con- sistently applied. Section 3.10. The Borrower shall at all times maintain such organizational arrangements as shall be necessary for purposes of coordinating the carrying out of all of the several Parts of the Project. Section 3.11. The Borrower shall: (a) not later than June 30, 1981, review with the Bank progress made in the carrying out of the Project; and (b) as Trustee for FOGAIN and for purpoes of refining its criteria for project appraisal, carry out, each year during the 1982-1983 period, an evaluation of a representative sample of Investment Projects financed out of the proceeds of FOGAIN Loans completed during that year. ARTICLE IV Financial Covenants Section 4.01. The Borrower, in its capacity as Trustee for the Fideicomisos in respect of Part A of the Project, and in its own capacity in respect of Part C of the Project, shall maintain or cause to be maintained records adequate to record the progress of the Project and of each Investment Project and to reflect in accordance with consistently maintained sound accounting practices the operations and financial condition of the Borrower in respect of Part C of the Project and of the Fideicomisos. Section 4.02. The Borrower shall: (i) make or cause to be made an annual audit satisfactory to the Bank of the Fideicomisos' accounts and financial statements (balance sheets, statements of income and expenses and related statements), and of the Separate Account for each fiscal year audited in accordance with sound - 13 - auditing principles consistently applied, by independent and qualified auditors; (ii) furnish to the Bank, as soon as available but in any case not later than six months after the end of each such year, (A) certified copies of such financial statements and of the Separate Account for such year as so audited and (B) the report of such audit by said auditors, of such scope and in such detail as the Bank shall have reasonably requested; and (iii) furnish to the Bank such other information concerning the accounts and financial statements of the Fideicomisos, the Separate Account and the audit thereof as the Bank shall from time to time reason- ably request. Section 4.03. (a) The Borrower represents that at the date of this Agreement no lien exists on any of its assets as security for any external debt or the assets of any of the Fideicomisos as security for any debt, except as otherwise stated to the Bank in writing. (b) The Borrower undertakes that, except as the Bank shall otherwise agree: (i) if the Borrower shall create any lien on any of its assets as security for any external debt or the assets of any of the Fideicomisos as security for any debt, such lien will ipso facto equally and ratably secure the payment of the principal of, and interest and other charges on, the Loan, and in the creation of any such lien express provision will be made to that effect, at no cost to the Bank; provided, however, that the foregoing provisions of this paragraph shall not apply to: (A) any lien created on property, at the time of purchase thereof, solely as security for the payment of the purchase price of such property; or (B) any lien arising in the ordinary course of banking transactions and securing a debt maturing not more than one year after the date on which it is originally incurred. Section 4.04. The Bank and the Borrower shall from time to time, at the request of either party, exchange views through their representatives with regard to the administration and operations of the Fideicomisos, and the Borrower shall furnish to the Bank all such information as the Bank shall reasonably request con- cerning such administration and operations. Section 4.05. The Borrower shall enable the Bank's repre- sentatives to inspect the records referred to in Section 4.01 of this Agreement and any relevant documents. - 14 - ARTICLE V Remedies of the Bank Section 5.01. For the purposes of Section 6.02 of the General Conditions the following additional events are specified: (a) a change shall have been made in any legal instrument under which FOGAIN, FOMIN or FIDEIN has been established which would materially and adversely affect the carrying out of the Project or the financial condition of FOGAIN, FOMIN or FIDEIN; (b) a change shall have been made in any of the Operating Regulations which would materially and adversely affect the carrying out of the Project; and (c) a resolution shall have been passed for the dissolution or liquidation of FOGAIN or FOMIN or FIDEIN. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified, namely, any event specified in Section 5.01 of this Agreement shall occur. ARTICLE VI Effective Date; Termination Section 6.01. The following event is specified as an addi- tional condition to the effectiveness of the Loan Agreement within the meaning of Section 12.01 (c) of the General Conditions, namely, that the Borrower and at least one of the Fideicomisos have entered into the contractual arrangements referred to in Section 3.02 (a) of this Agreement. Section 6.02. The following are specified as additional matters, within the meaning of Section 12.02 (c) of the General Conditions, to be included in the opinion or opinions to be furnished to the Bank: (a) that the contractual arrangements referred to in Section 6.01 of this Agreement are legally binding upon the parties thereto; and - 15 - (b) that all necessary acts, consents and approvals to be performed or given by the Guarantor, its political subdivisions or agencies or by any agency of any political subdivision or other- wise to be performed or given in order to authorize the carrying out of the Project and to enable the Borrower to perform, in its own capacity and as Trustee for the Fideicomisos, all of the covenants, agreements and obligations of the Borrower in the Loan Agreement contained, together with all necessary powers and rights in connection therewith, have been duly and validly per- formed or given and no other such acts, consents and approvals are required to be performed or given for said purpose. Section 6.03. The date /9SJ 1q cn, is hereby specified for the purpose of Section 12.02 of the General Condi- tions. ARTICLE VII Addresses Section 7.01. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAFRAD 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) For the Borrower: Nacional Financiera, S.A. Isabel la Cat6lica 51 Mexico 1, D.F. Mexico Cable address: Telex: NAFIN NAFIN 383-1775765 BMXME Mexico City Mexico City - 16 - IN WITNESS WHEREOF the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By Regional Vice President Latin America and the Caribbean NACIONAL FINANCIERA, S.A. By Aut'horized Representative - 17 - SCHEDULE 1 Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* On each June 1 and December 1 beginning December 1, 1984 through December 1, 1996 3,845,000 On June 1, 1997 3,875,000 * To the extent that any portion of the Loan is repayable in a currency other than dollars (see General Conditions, Section 4.02), the figures in this column represent dollar equivalents determined as for purposes of withdrawal. - 18 - Premiums on Prepayment The following percentages are specified as the premiums payable on repayment in advance of maturity of any portion of the principal amount of the Loan pursuant to Section 3.05 (b) of the General Conditions: Time of Prepayment Premium Not more than three years before maturity 1.45% More than three years but not more than six years before maturity 2.90% More than six years but not more than eleven years before maturity 5.35% More than eleven years but not more than fifteen years before maturity 7.30% More than fifteen years before maturity 8.25% - 19 - SCHEDULE 2 Modifications of the General Conditions For the purposes of the Loan Agreement, the provisions of the General Conditions are modified as follows: (1) The words "Investment Projects" are added after the words "the Project" at the end of Section 5.03. (2) Section 6.03 is deleted and replaced by the following new Section: "Section 6.03. Cancellation by the Bank. If (a) the right of the Borrower to make withdrawals from the Loan Account shall have been suspended with respect to any amount of the Loan for a continuous period of thirty days, or (b) by the date specified in paragraph (c) of Section 2.03 of the Loan Agreement no applications or requests permitted under paragraph (a) or paragraph (b) of such Section shall have been received by the Bank in respect of any portion of the Loan, or having been so received, shall have been denied, or (c) after the Closing Date an amount of the Loan shall remain unwithdrawn from the Loan Account, or (d) the Bank shall have received notice from the Guarantor pursuant to Section 6.07 with respect to an amount of the Loan, the Bank may by notice to the Borrower terminate the right of the Borrower to submit such applications or requests or to make withdrawals from the Loan Account, as the case may be, with respect to such amount or portion of the Loan. Upon the giving of such notice such amount or portion of the Loan shall be cancelled." INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Bank for Reconstruction and Develop- ment. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Bank thereunto this % day of ., 198 C2. FOR SECRETARY