Mexico - Second Power Project : Loan 0186 - Loan Agreement - Conformed

LOAN NUMBER 186 ME Loan Agreement (Second Power Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT .AND THE MEXICAN LIGHT AND POWER COMPANY, LIMITED DATED JANUARY 14, 1958 LOAN NUMBER 186 ME Loan Agreement (Second Power Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND THE MEXICAN LIGHT AND POWER COMPANY, LIMITED DATED JANUARY 14, 1958 Enan Agreement AGREEMENT, dated January 14, 1958, between INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and THE MEXICAN LIGHT AND POWER COMPANY, LIMITED (hereinafter called the Borrow- er). ARTICLE I Loan Regulations; Special Definitions SECTION 1.01. The parties to this Loan Agreement accept all the provisions of Loan Regulations No. 4 of the Bank dated June 15, 1956, subject, however, to the modifications thereof set forth in Schedule 3 to this Loan Agreement (sa",i Loan Regulations No. 4 as so modified being herein- after called the Loan Regulations), with the same force and effect as if they were fully set forth herein. SECTION 1.02. Except where the context otherwise re- quires, the following terms have the following meanings wherever used in this Loan Agreement or any Schedule thereto: (a) The term "Indenture" means the Indenture of Mort- gage dated as of February 1, 1950, executed by the Borrower and its Subsidiaries in favor of National Trust Company, Limited, as Trustee, and includes any indenture supplemental thereto which has been or shall be executed and delivered in accordance with the provisions of the Indenture. (b) The term "Supplemental Indenture" means the sup- plemental indenture to be executed between the Bor- rower and the Trustee providing for the issue, authentication and delivery of First Mortgage and Collateral Trust Bonds, Series E, in accordance with the terms of this Loan Agreement. (c) The term "Indenture of Guarantee" means the in- denture of guarantee to be executed by the Guarantor 4 in favor of the Trustee in accordance with the provi- sions of the Guarantee Agreement. (d) The term "Trustee" means National Trust Com- pany, Limited, and also any successor trustee which shall become Trustee in the manner prescribed in Article Fifteen of the Indenture. (e) The term "Subsidiary" shall have the meaning set forth in Section 1.1.1 of the Indenture. ARTICLE II The Loan SECTION 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions in this Loan Agreement set forth or referred to, an amount in various currencies equiv- alent to eleven million dollars ($11,000,000). SECTION 2.02. The Bank shall open a Loan Account on its books in the name of the Borrower and shall credit to such Account the amount of the Loan. The amount of the Loan may be withdrawn from the Loan Account as provided, and subject to the rights of cancellation and suspension set forth in this Loan Agreement and in the Loan Regulations. SECTION 2.03. The Borrower shall pay to the Bank a commitment charge at the rate of three-fourths of one per cent (3/4 of 1%1) per annum on the principal amount of the Loan not so withdrawn from time to time. Such commit- ment charge shall accrue from November 13, 1957, to the respective dates on which amounts shall be withdrawn by the Borrower from the Loan Account as provided in Article IV of the Loan Regulations or shall be cancelled pursuant to Article V of the Loan Regulations. SECTION 2.04. The Borrower shall pay interest at the rate of five and five-eighths per cent (55/%o) per annum on 5 the principal amount of the Loan so withdrawn and out- standing from time to time. SECTION 2.05. Except as the Bank and the Borrower shall otherwise agree, the charge payable for special commit- ments entered into by the Bank at the request of the Bor- rower pursuant to Section 4.02 of the Loan Regulations shall be at the rate of one-half of one per cent ('/2 of 17) per annum on the principal amount of any such special commitments outstanding from time to time. SECTION 2.06. Interest and other charges shall be pay- able semi-annually on March 15 and September 15 in each year. SECTION 2.07. The Borrower shall repay the principal of the Loan in accordance with the amortization schedule set forth in Schedule 1 to this Loan Agreement. ARTICLE III Use of Proceeds of the Loan SECTION 3.01. The Borrower shall apply the proceeds of the Loan exclusively to financing the cost of goods required to carry out the Project described in Schedule I to this Loan Agreement. The specific goods to be financed out of the proceeds of the Loan shall be determined by agreement between the Bank and the Borrower, subject to modifica- tion by further agreement between them. SECTION 3.02. The Borrower shall cause all goods financed out of the proceeds of the Loan to be imported into the territories of the Guarantor and there to be used exclu- sively in the carrying out of the Project and, except as the Bank shall otherwise agree, (a) title to all such goods shall be acquired by the Borrower or a Subsidiary free and clear of all liens, charges and encumbrances, and (b) all such goods shall constitute bondable property as that term is defined in Section 1.06 of the Indenture. 6 ARTICLE IV Bonds SECTION 4.01. The Borrower shall execute and deliver Bonds representing the principal amount of the Loan of the form, tenor and purport prescribed in the Supplemental Indenture and as provided thereby, by the Indenture and the Loan Regulations, and having the guarantee of the Guarantor endorsed thereon and authenticated by the Trustee as provided by the Indenture of Guarantee. SECTION 4.02. Except as the Bank and the Borrower shall otherwise agree, the Borrower shall, against payment by the Bank of any amount to be withdrawn from the Loan Ac- count, pursuant to Article II of this Loan Agreement, deliv- er to or on the order of the Bank, Bonds in the aggregate principal amount so paid; provided that, if and when the Bank shall so request, the Borrower shall, as soon as prac- ticable, and within 30 days after the date of the request, execute and deliver to or on the order of the Bank, Bonds in the aggregate principal amount specified in such request not exceeding, however, the aggregate principal amount of the Loan which shall have been withdrawn and shall be outstanding and unpaid at the date of such request and for which Bonds shall not theretofore have been so delivered or requested. SECTION 4.03. Upon any exchange of Bonds pursuant to Section 6.11 of the Loan Regulations or upon any exchange of Bonds pursuant to Section 3.10 of the Indenture or any issuance of Bonds in exchange for or in lieu of mutilated, lost or destroyed Bonds pursuant to Section 3.12 of the Indenture, the new Bonds shall be of the same aggregate principal amount; shdll have the guarantee of the Guaran- tor endorsed thereon and autheiticated as provided in the Indenture of Guarantee; and, except as in Section 6.11 of the Loan Regulations or Section 3.10 or 3.12 of the Inden- ture provided, as the case may be, shall be of the same tenor 7 and effect as the Bonds for which they shall be exchanged or in lieu of which they shall be issued. SECTION 4.04. Except as the Bank shall otherwise agree, the Borrower shall not redeem or make provision for the redemption of Bonds otherwise than in inverse order of maturity. SECTION 4.05. The officers of the Borrower specified in Section 3.06 of the Inlenture are designated as authorized representatives of the Borrower for the purposes of See- tion 6.12 (a) of the Loan Regulations. ARTICLE V Particular Covenants SECTION 5.01. (a) The Borrower shall, and shall cause the Subsidiaries to, carry out the Project with due diligence and efficiency and in conformity with sound engineering and financial practices. (b) The Borrower shall, and shall cause the Subsidiaries to, furnish to the Bank, promptly upon their preparation, the plans and specifications for the Project and any material modifications subsequently made therein, in such detail as the Bank shall from time to time request. (c) The Borrower shall, and shall cause the Subsidiaries to, maintain records adequate to identify the goods financed out of the proceeds of the Loan, to disclose the use thereof in the Project, to record the progress of the Project (includ- ing the cost thereof) and to reflect in accordance with con- sistently maintained sound accounting practices the opera- tions and financial condition of the Borrower and the Sub- sidiaries; shall enable the Bank's representatives to inspect the Project and all other plants, works, properties, equip- ment and operations of the Borrower and the Subsidiaries, the goods and any relevant records and documents; and shall furnish to the Bank all such information as the Bank shall reasonably request concerning the expenditure of the 8 proceeds of the Loan, the Project, the goods and the opera- tions and financial condition of the Borrower and the Sub- sidiaries. SECTION 5.02. (a) The Bank and the Borrower shall co- operate fully to assure that the purposes of the Loan will be accomplished. To that end, each of them shall furnish to the other all such information as it shall reasonably r(equest with regard to the general status of the Loan. (b) The Bank and the Borrower shall from time to time exchange views through their representatives with regard to matters relating to the purposes of the Loan and the maintenance of the service thereof. The Borrower shall promptly inform the Bank of any condition which inter- feres with, or threatens to interfere with, the accomplish- ment of the purposes of the Loan or the,maintenance of the service thereof. SECTION 5.03. The Borrower shall, and shall cause each Subsidiary to, perform duly and punctually all the cove- nants, agreements and obligations on its part in the 'Inden- ture set forth. SECTION 5.04. The Borrower shall pay or cause to be paid all taxes or fees, if any, imposed under the laws of the Guarantor or by any taxing or fiscal authority thereof or therein on or in connection with the execution, issue, deliv- ery, registration, recording, filing or protocolization of this Loan Agreement, the Guarantee Agreement, the In- denture, the Supplemental Indenture, the Bonds or the Indenture of Guarantee, or the payment of principal, inter- est, premium or other charges thereunder; provided, how- ever, that the provisions of this Section shall not apply to taxation of, or fees upon, payments under any Bond to a holder thereof other than the Bank when such Bond is beneficially owned by an individual or corporate resident of the Guarantor. 99 SECTION 5.05. The Borrower shall pay or cause to be paid all taxes and fees, if any, imposed under the laws of Canada or the country or countries in whose currency the Loan and the Bonds are payable or laws in effect in Canada or the territories of such country or countries on or in connection with the execution, issue, delivery or registration of this Loan Agreement, the Guarantee Agreement, the Indenture, the Supplemental Indenture, the Indenture of Guarantee or the Bonds. SECTION 5.06. (a) The Borrower shall, and shall cause each Subsidiary to, at all times maintain its existence and right to carry on operations and shall, except as the Bank shall otherwise agree, take all steps necessary to acquire, maintain and renew all rights, powers, privileges and fran- chises which are necessary in the conduct of its business. (b) The Borrower shall, and shall cause each Subsidiary to, operate its undertaking nwl conduct its affairs all in accordance with sound business, financial and public utility practices and shall operate, maintain, repair and renew its plants, machinery, equipment and property as required in accordance with sound engineering practices. SECTION 5.07. Unless the Bank shall otherwise agree, the Borrower shall not declare or pay any dividend or make any other distribution on any of its shares of capital stock of any class (other than a dividend payable in shares of capital stock of the Borrower), if, after giving effect to any such dividend or distribution (other than those payable in shares of capital stock), the aggregate payments by the Bor- rower for all such purposes subsequent to December 31, 1956, would exceed the sum of (i) $6,000,000 and (ii) the consolidated net income of the Borrower and all the Sub- sidiaries (determined in accordance with sound accounting practice) available for dividends on shares of capital stock of the Borrower earned subsequent to December 31, 1956; . provided, however, that this covenant shall not prevent the Borrower from paying dividends at the fixed preferential 10 rate on its now outstanding preferred shares and on any other preferred shares hereafter issued by the Borrower for cash. SECTION 5.08. Except as in this Loan Agreement ex- pressly provided and unless the Bank shall otherwise agree, the Borrower shall not (a) issue any bonds pursuant to Section 5.06 of the In- denture unless the proceeds thcreof shall be invested in property additions as such term is defined in the Indenture; or (b) request the release under Article Seven of the Inden- ture or otherwise dispose or permit the disposal of (1) ownership or control of any Subsidiary; or (2) all or substantially all of its property and assets or all or substantially all of the property and assets of any Subsidiary; or (3) all or substantially all the property included in the Project. SECTION 5.09. The Borrower shall within 8 months after the end of each calendar year deliver to the Bank a list of all bondable property (as the term bondable property is defined in Section 1.06 of the Indenture) acquired by the Borrower or any Subsidiary during such calendar year. Such list shall include a description of such property and the estimated value thereof. If the Bank shall so request the Borrower shall, and shall cause each Subsidiary to, take such action as shall be necessary to subject any or all of such property to the specific lien of the Indenture to the extent and in the manner provided in Section 9.08 thereof and to perfect such lien by recordation and filing to the extent permitted under the laws of the Guarantor. SECTION 5.10. In any calendar year in which the Bor- rower or any Subsidiary shall redeem or purchase, directly or indirectly, prior to maturity any bonds issued under the Indenture other than Series D bonds, unless the Bank shall otherwise agree, the Borrower shall in such year redeem, 11 or purchase or cause to be purchased prior to maturity, an aggregate principal amount of Bonds which shall bear a not lower ratio to the aggregate principal amount of Bonds outstanding at the beginning of such calendar year than the highest ratio derived by dividing the aggregate principal amount of bonds of each series other than Series E or D redeemed or purchased directly or indirectly during such year by the Borrower and all Subsidiaries by the aggregate principal amount of bonds of such series outstanding ot the beginning of such calendar year. For the purpose of this Section there shall be excluded in determining the aggregate amount of bonds so redeemed or purchased in any calendar year (a) bonds of serial maturities maturing during such year and (b) bonds purchased or redeemed durir such year which shall have been applied during such year as a credit to any sinking fund or analogous fund provided for in the Indenture or any supplemental inden- ture relating to such bonds or purchased or redeemed by operation of any such funds. SECTION 5.11. The Borrower shall not consent, and shall not permit any Subsidiary to consent, to any action taken at any meeting of bondholders pursuant to Section 19.01 of the Indenture or by written instrument pursuant to See- tion 19.02 thereof which would change the terms of the Bonds or adversely affect the holders thereof unless the Bank shall have expressed in writing its approval of such action or such consent. SECTION 5.12. Unless the Bank shall otherwise agree, neither the Borrower nor any Subsidiary shall directly or indirectly, redeem, purchase or otherwise acquire for any consideration other than capital stock of the Borrower any of the capital stock of the Borrower or of the 51/2% Cumu- lative Income Debenture Stock of the Borrower, except as such 5 % Cumulative Income Debenture Stock shall be retired through operation. of the sinking fund therefor in accordance with the provisions of the Trust Deed under 12 which said Debenture Stock was issued; provided that the provisions of this Section shall not apply to or restrict the redemption or purchase, for a consideration other than capital stock of the Borrower, of capital stock or 51/2% Cumulative Income Debenture Stoe' of the Borrower to the extent that the aggregate cost of all such redemptions and purchases shall not exceed the net proceeds received by the Borrcwer after December 31, 1949, from the sale of shares of its capital stock and, in the case of such redemp- tion or purchase of 51/2% Cumulative Income Debenture Stock of the Borrower, to the extent that the aggregate cost thereof does not exceed the net proceeds received by the Borrower after December 31, 1949, from the sale of its income debenture stock having terms no more favorable to the holders than the 5 %% Cumulative Income Debenture Stock. SECTION 5.13. (a) Except as shall be otherwise agreed between the Bank and the Borrower, the Borrower shall insure or cause to ,be insured with responsible insurers all goods financed with the proceeds of the Loan. Such insur- ance shall cover such marine, transit and other hazards incident to delivery of the goods into the territories of the Guarantor, and shall be for such amounts, as shall be con- sistent with sound commercial practice. Such insurance shall be payable in the currency in which the cost of the goods insured thereunder shall be payable. (b) In addition, the Borrower shall, and shall cause its Subsidiaries to, insure against such risks and in such amounts as shall be consistent with sound public utility and business practices. SECTION 5.14. The Borrower shall pay all charges, fees and expenses which the Trustee and any successor trustee from time to time in office under the Indenture of Guar- antee shall make for or incur in the performance of their duties thereunder and shall give the Trustee and any such successor trustee such written undertakings to that effect as any of them may request. 13 SECTION 5.15. The Borrower shall, and shall cause the Subsidiaries to, protocolize, record, file and register the Supplemental Indenture as provided in Section 9.08 of the Indenture as promptly as shall be reasonably practicable, and shall, upon the protocolization, recordation, filing and registration thereof, furnish to the Bank an opinion or opinions satisfactory to the Bank of legal counsel acceptable to the Bank showing that the Supplemental Indenture has been validly and effectively protocolized, recorded, filed and registered, and has created valid and effective liens, charges and priorities in accordance with its terms. ARTICLE VI Remedies of the Bank SECTION 6.01. (i) If any of the events defined in Section 12.01 of the Indenture as "defaults" shall occur and be continuing or the security constituted by the Indenture shall have, by any reason, become enforceable, or (ii) if any event specified in paragraph (a), paragraph (b), paragraph (e) or paragraph (f) of Section 5.02 of the Loan Regula- tions shall occur and shall continue for a period of thirty days, or (iii) if any event specified in paragraph (c) of Section 5.02 of the Loan Regulations shall occur and shall continue for a period of sixty days after notice thereof shall have been given by the Bank to the Borrower, then at any subsequent time during the continuance thereof, the Bank, at its option, may declare the principal of the Loan and of all the Bonds then outstanding to be due and payable im- mediately, and upon any such declaration such principal shall become due and payable immediately anything in this Loan Agreement, in the Indenture or the Bonds to the contrary notwithstanding. ARTICLE VII Effective Date; Termination SECTION 7.01. The following events are specified as ad- ditional conditions to the effectiveness of this Loan Agree- 14 ment within the meaning of Section 9.01 (a) (ii) and Sec- tion 9.01 (b) (ii) of the Loan Regulations: (a) The Supplemental Indenture, substantially in the form annexed hereto as Schedule 4, has been exe- cuted and delivered by the Borrower, the Subsid- iaries and the Trustee. (b) First Mortgage and Collateral Trust Bonds of Series E in an aggregate principal amount of $11,000,000 have been executed by the Borrower and authenti- cated by the Trustee as provided in Section 2.04 of the Supplemental Indenture. (c) The Indenture of Guarantee, substantially in the form annexed to the Guarantee Agreement, has been executed and delivered by the Guarantor and the Trustee. SECTION 7.02. The following are specified as additional matters within the meaning of Section 9.02 (e) of the Loan Regulations, to be included in the opinion or opinions to be furnished to the Bank: (a) That the execution and delivery of the Supplemental Indenture by the Borrower, the Subsidiaries and the Trustee have been duly authorized and ratified by all necessary corporate and governmental action and that such Supplemental Indenture is valid and bind- ing on the Borrower, the Subsidiaries and the Trus- tee in accordance with its terms; and (b) That First Mortgage arid Collateral Trust Bonds of Series E in an aggregate principal amount of $11,000,000 have been executed by the Borrower and authenticated by the Ti ustee as provided in Section 2.04 of the Supplemental Indenture, and will, when delivered to the Bank in accordance with the Loan Agreement and the Indenture, constitute valid and binding obligations of the Borrower in accordance 15 with their terms, and that no additional signatures or formalities are required for that purpose; and (c) That the execution and delivery of the Indenture of Guarantee by the Guarantor and the Trustee have been duly authorized and ratified by all necessary corporate and governmental action and that such Indenture of Guarantee is valid and binding in ac- cordance with its terms; and (d) That the guarantee on the Bonds when executed and delivered by the Guarantor and authenticated by the Trustee, in accordance with the Guarantee Agree- ment and the Indenture of Guarantee, will constitute a valid and binding obligation of the Guarantor in accordance with its ternis and that, except as stated in such opinion, no signatures or formalities other than those provided for in the Guarantee Agreement and the Indenture of 'Ouarantee are required for that purpose. SECTION 7.03. The date specified for the purposes of Section 9.04 of the Loan Regulations shall be January 31, 1958. ARTICLE VIII Miscellaneous SECTION 8.01. The Closing Date shall be July 1, 1959. SECTION 8.02. The following addresses are specified for the purposes of Section 8.01 of the Loan Regulations: (a) For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington 25, D. C. United States of America 16 Alternative address for cablegrams and radiograms: Intbafrad Washington, D. C. (b) For the Borrower: The Mexican Light and Power Company, Limited 25 King Street West Toronto 1, Ontario Canada with copy to The Mexican Light and Power Company, Limited 2a Calle de Gante No. 20 Mexico, D. F. Mexico Alternative address for cables and radiograms: Melipo Toronto with copy to Melipoco Mexico City IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Loan Agreement to be signed in their respective names and delivered in the District of Columbia, United 긔 18 SOREDULZI Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars) Sept. 15, 1959 $18000 March 15,1960 186,000 Sept. 15, 1960 191VOOO March 15,1961 196tOOO Sept.15,1961 202POOO March 15,1962 207,000 Sept. 15, 1962 213,000 March 15,1963 219,000 Sept.15,1963 225,000 March 15,1964 232,000 Sept.15,1964 238,000 March 15,1965 245,000 Sept. 15, 1965 252,000 March 15,1966 259,000 Sept. 15, 1966 266,000 March 15,1967 274,000 Sept. 15, 1967 281pOOO March 15, 1968 289,000 Sept. 15t 1968 297,000 March 15,1969 306,000 Sept. 15, 1969 314,000 March 15,1970 323,000 Sept.15,1970 332,000 March 15,1971 342,000 Sept.15,1971 351,000 March 15,1972 361,000 Sept. 15, 1972 371,000 March 15,1973 382,000 Sept. 15, 1973 392,000 March 15,1974 403pOOO Sept. 15, 1974 415,000 March 15,1975 427pOOO Sept. 15, 1975 438,000 March 15, 1976 451,000 Sept. 15,1976 463tOOO March 15,1977 477,000 To the extent that any part of the Loan is repayable in a currency other than dollars (see Loan Regulations, Section 3.02), the figures in this column represent dollar equivalents determined as for purposes of withdrawal. 19 Premiums on Prepayment and Redemption The following percentages are specified as the premiums payable on repayment in advance of maturity of any part of the principal amount of the Loan pursuant to Section 2.05 (b) of the Loan Regulations or on the redemption of any Bond prior to its maturity pursuant to Section 6.16 of the Loan Regulations and the Indenture: Time of Prepayment or Redemption Premium Not more than three years before maturity .. . ................ ..... 1 of 1% More than three years and not more than six years before maturity . . . . . . . . 11/2% More than six years and not more than eleven years before maturity . 2% More than eleven years and not more than sixteen years before maturity 31/2% More than sixteen years and not niore than eighteen years before maturity 41/2% More than eighteen years before maturity 5%8 20 SHEDULE 2 Description of Project I. THERMAL GENERATING PLANTS (a) Lecheria An additional generating unit (Unit No. 3) will be in- stalled in the Lecheria thermoelectric plant, consisting of one 82,400 KW, maximum capacity turbo-generator with adequate steam boiler, cooling tower, miscellaneous piping, transformer, switchboard and necessary auxiliary equip- ment. An extension to the existing turbine room with space sufficient for the later addition of a fourth unit will be con- structed. Additional switchgear equipment will be pro- vided at the Lecheria substation for the interconnection of the new unit to the power system of the Borrower. (b) Nonoalco The capacity of the existing turbo-generators Nos. 4 and 5 of the Nonoalco Steam Plant will be increased from 25,000 KW to 31,250 KW each. To this end, some turbine parts will be replaced by appropriate ones and small modifica- tions to the corresponding cooling towers, circulating pumps and other auxiliaries will be made. II. TRANSMISSION AND DISTRIBUTION SYSTEMS The existing Narvarte substation in Mexico City will be reconstructed and a 30,000 kva, 85/6 kv transformer bank will be installed. Two 85 kv compression-type three-phase underground cables, 5.5 kilometers long, will be installed connecting the Narvarte and Tasquefia substations. The necessary switchgear equipment for the protection and con- trol of the new cables will be installed at both ends of the new transmission circuits. Miscellaneous extensions to the transmission and distri- bution systems will be made, including the installation of underground cable and equipment for a new automatic net- 21 work in Mexico City. The necessary equipment for new 6 kv feeders and for routine distribution extensions will be installed. Watthour meters and demand meters required for connecting new services will be provided. The installa- tion of static condensers at several points of the power system of the Borrower to improve the operating condi- tions of the transmission and distribution facilities will be carried out. 22 SHEDULE 3 Modifications of Loan Regulations No. 4 For the purposes of this Loan Agreement the provisions of Loan Regulations No. 4 of the Bank, dated June 15, 1956, are modified as follows: (a.) Section 2.02 is deleted. (b) Section 6.01 is.deleted. (c) Section 6.03 is deleted. (d) Section 6.06 is amended to read as follows: " SECTION 6.06. Maturities of Bonds. The maturities of the Bonds shall correspond to the maturities of installments of the principal amount of the Loan set forth in the amortization schedule to the Loan Agree- ment. Except as the Bank and the Borrower shall otherwise agree, the maturities of the Bonds deliv- E -ed at any one time shall correspond pro rata as warly as practicable to the maturities of the Loan not theretofore cancelled." (e) Section 6.07 is amended to read as follows: " SECTION 6:07. Form of Bonds. The Bonds shall be fully registered bonds without coupons (hereinafter sometimes called registered Bonds) or bearer bonds (registrable as to principal) with coupons for semi- annual interest attached (hereinafter sometimes called coupon Bonds). Bonds delivered to the Bank shall be registered Bonds or coupon Bonds in such form (authorized by the Supplemental Indenture) as the Bank shall request. Registered Bonds and coupon Bonds payable in dollars and the coupons attached thereto shall be substantially in the forms respec- tively set forth in the Supplemental Indenture. Bonds payable in any currency other than dollars shall be substantially in the forms respectively set forth in the Supplemental Indenture, as the case may be, except that they shall (a) provide for payment 9 23 of principal, interest and premium on redemption, if any, in such other currency, (b) provide for such place of payment as the Bank shall specify, and (c) contain such other modifications as the Bank shall reasonably request in order to conform to the laws or to the financial usage of the place where they are payable." (f) The words "delivered pursuant to any request under Section 6.03" and the words "in such request" are deleted from Sections 6.05 and 6.10. (g) The first two sentences of Section 6.09 are deleted. (h) The following new subparagraph (d) is added to Section 6.11, namely: "(d) Subject to the provisions of Section 6.05 and 6.06 of these Regulations, Bonds payable in any currency may be exchanged, upon pay- ment by the Bank of the reasonable cost of such exchange, for Bonds of an equivalent ag- grcgate principal amount payable in the same currency hut having a different maturity or maturities." (i) Section 6.18 is deleted. (j) In. Section 7.01, after the words "Guarantee Agree- ment" where those words occur, the words ", the Indenture" are added. (k) The second sentence of Section 7.02 is amended to read as follows: "Such obligations shall not be subject to any prior notice to, demand upon or action against the Bor- rower or to any prior notice to or demand upon the Guarantor with regard to any default by the Bor- rower, and shall not be impaired by any of the fol- lowing: any extension of time, forbearance or con- cession given to the Borrower; any assertion of, or failure to assert, or delay in asserting, any right, 24 power or remedy against the Borrower or in respect of any security for the Loan; any modification or amplification of the provisions of the Loan Agree- ment contemplated by the terms thereof; any modi- fication or amplification of any other document re- lated to the Loan or related to any security therefor; any failure of the Borrower to comply with any re- quirement of any law, regulation or order of the Guarantor or of any political subdivision or agency of the Guarantor." (1) subparagraph (j) of Section 7.04 is amended to read as follows: "(j) The provisions for arbitration set forth in this Section shall be in lieu of any other procedure for the determination of controversies between the parties to the Loan Agreement and Guar- antee Agreement or any claim by any such party agaii,st any other such party arising thereunder; provided, however, that nothing herein shall be deemed to preclude any of the said partie,i from exercising, or instituting any legal or equitable action to enforce, any right or claim arising out of or pursuait to the Inden- ture or the Bonds, and submission to arbitra- tion hereunder shall not be deemed to be a con- dition precedent or in any way to prejudice such exercise or other enforcement of any such right or claim." (m) Subparagraphs (b) and (d) of Section 9.02 are de- leted. (n) Paragraph 10 of Section 10.01 is amended to read as follows: "The term 'Bond' or 'Bonds' means one or more First Mortgage and Collateral Trust Bonds, Series E, issued and authenticated pursuant to the Inden- ture with the guarantee of the Guarantor endorsed thereon and authenticated as provided in the Inden- ture of Guarantee." 25 SCHEDULE 4 Form of Supplemental Indenture In the City of Toronto, in the County of York, in the Province of Ontario, Canada, on the day of I .. . , 719. , before me, a Notary Public by royal authority duly appointed, residing in the said City of Toronto, with office at No. 25 King Street West in the said City of Toronto, in the presence of the witnesses who will be named at the end hereof, residents of this locality, without disqualification to act as such, APPEAR: Firstly, , years of age, to me personally known, citizen of, and resident of , and G. L. Stewart, years of age, to me personally known, citizen of Canada, married, public utility official and resident of the said City of Toronto, who severally declare that the said is..... and the said G. L. Stewart is Secretary, of The Mexican Light and Power Company, Limited, hereinafter sometimes referred to as the "Company", a corporation organized and existing under the laws of Canada and having its dorni- cile in the said City of Toronto, and duly qualified to do business in the United Mexican States, its charter having been protocolized and registered in the Public Registry of the City of Mexico under No. 4456, page 164 of Book 3, Volume 21 of the Section of Commerce. And the said appearers further severally declare that they appear and act herein for and in the name and behalf of said Company, in their respective capacities aforesaid, by virtue of a resolution duly adopted by the Board of Directors of said Company at itt meeting legally convened and held at the office of said Comipany in the said City of Toronto, on the day of . , 19. ; all as the appearers establish by the certificate which they 26 deliver to me in order that I may attach it to this Supple- mental Indenture and by which certificate there is also proved their respective characters of................ and Secretary of said Company. Secondly: I. .... ......, .... years of age, to me personally known, citizen of .. .. .........., and resident of . . ... . ..... who declares that he is ................of Compania de Luz y Fuerza de Pachuca, S.A., Compania Mexicana Meridional de Fuerza, S.A., Compania de Fuerza del Suro- este de Mexico, S.A., Compania de Luz y Fuerza Electrica de Toluca, S.A., Compania Mexicana Hidro-Electrica y de Terrenos, S.A., and Edificio de Luz y Fuerza, S.A., all of which are corporations organized and existing under the laws of the United Mexican States and having their respec- tive domiciles in the said City of Mexico, D.F., Mexico, and all of which together with L. M. Guibara, Sucesores, S. en C., are hereinafter sometimes collectively referred to as the "Subsidiaries"; the respective charters having been proto- colized and registered in the Public Registry of the City of Mexico as follows: As to the Subsidiary, Comipania de Luz y Fuerza de Pachuca, S.A., under No. 281, page 113 of Book 3 of Volume 37 of the Section of Commerce; As to the Subsidiary, Compania Mexicana Meridional de Fuerza, S.A., under No. 656, page 331 of Book 3 of Volume 68 of the Section of Commerce; As to the Subsidiary, Compania de Fuerza del Suroeste de Mexico, S.A., under No. 503, page 234 of Book 3 of Volume 63 of the Section of Commerce; As to the Subsidiary, Compania de Luz y Fuerza Elec- trica de Toluca, S.A., under No. 841, page 354 of Book 3 of Volume 73 of the Section of Commerce; As to the Subsidiary, Compania Mexicana Hidro-Elec- trica y de Terrenos, S.A., under No. 14, page 7, back, of Book 3 of Volume 62 of the Section of Commerce; 27 As to the Subsidiary, Edificio de Luz y Fuerza, S.A., under No. 916, page 392 of Book 3 of Volume 74 of the Section of Commerce. And the said appearer further declares that he appears and acts herein for and in the name and behalf of said Subsidiaries except as to L. M. Guibara, Sucesores, S. en C., in his capacity as of each of said Sub- sidiaries, by virtue of resolutions duly adopted by the sev- eral Boards of Directors of said Subsidiaries at meetings thereof legally convened and held at the respective offices of said Subsidiaries in the City of Mexico on the clay of . . ., 19 . ; all as the said appearer establishes by the certificates which he delivers to me in order that I may attach them to this Supplemental Inden- ture and by which certificates there is also proved his char- acter as of the respective Subsidiaries. Thirdly: . 7 years of age, to me personally known, citizen of , . . ... and resident of who declares that he appears and acts herein for and in the name of L. M. Guibara, Sucesores, S. en C., a partnership organized and existing under the laws of the United Mexican States having its domicile in the City of Mexico, D. F., Mexico; such partnership being estab- lished by documents protocolized and registered in the Pub- lic Registry of the City of Mexico under No. 576, page 291 of Book 3 of Volume 68 of the Section of Commerce. And the said appearer further declares that he appears and acts herein for and in the name and on behalf of said partnership by virtue of a resolution duly adopted by the Board of Directors of Compania Mexicana Hidiro-Electrica y de Terrenos, S.A., hereinabove mentioned, at its meeting legally convened and held at the office of said corporation in the said City of Mexico on the day of . , 19 ; and the appearers firstly above named declare that they appear pursuant to a resolution duly adopted by the 28 Board of Directors of The Mexican Light and Power Com- pany, Limited, hereinabove mentioned, at its meeting legally convened and held at the office of said Company in the said City of Toronto on the ...... day of ........... ., 19. . for the purpose of granting the consent of said Company to the said partnership entering into this Supplemental Inden- ture; the said The Mexican Light and Power Company, Limited, and the said Compania Mexicana Hidro-Electrica y de Terrenos, S.A., being the sole partners of the said partnership; all as the appearers establish by the certifi- cates which they deliver to me in order that I may attach them to this Supplemental Indenture. Fourthly: ........... ........... years of age, to me personally known, citizen of Canada .. ........... , trust company official, and a resident of the said City of Toronto, and . . , . . . ........ .... years of age, to me personally known, citizen of Canada,..........., trust company official, and a, resident of the said City of Toronto, who severally declare that the said...... is ............, and the said is ........ , of National Trust Company, Limited, hereinafter sometimes referred to as the "Trustee", a corporation organized and existing under the laws of the Province of Ontario, Canada, having its domicile in the said City of Toronto. And the said appearers further severally declare that they appear and act herein for and in the name and behalf of said Trustee by virtue of a resolution duly adopted by the Board of Directors of said Trustee at its meeting legally convened and held at its principal office in the said City of Toronto, on the . . . . day of.. , 19 . .; all as the appearers establish by the certificate which they deliver to me in order that I may attach it to this Supple- mental Indenture and by which certificate there is also proved their respective characters as ....... ...and . . of said Trustee. 29 I, the Notary, certify to being acquainted with the parties who appear, and to being informed by their declarations as to their occupations and residences, nothing to the contrary being known to me. All the parties assure me, under their most strict respon- sibility, that the said Company and Subsidiaries and Trus- tee which they respectively represent have not been dis- solved nor are they in the course of liquidation and that the resolutions set forth in the certificates which they have respectively delivered to me have not been revoked, sus- pended nor modified in any manner. . Said parties further respectively assure me not only with respect to themselves but also to the entities which they represent that they have not only the free administration of their property but also the full enjoyment and exercise of their civil rights, and that they have, as in my judgment they do have, the legal capacity for the execution of this instrument. I, the Notary, also certify to having had before me evi- dence that the said Company and Subsidiaries and Trustee were duly organized and are validly existing. EXPOSITION: And the said appearers, firstly, secondly and thirdly above named further declare: First: This Indenture is supplemental to: (1) The Indenture of Mortgage bearing formal date as of the first day of February, 1950, executed by the said parties and by The Mexican Electric Light Company, Limited in the said City of Toronto on the 4th day of May, 1950 before Peter Scarth Osler, Notary, which Indenture of Mortgage, together with a Supplemental Indenture dated the 15th day of September, 1950 executed for the purpose of correcting errors therein, was protocolized by Deed No. 22,688 on the 16th day of January, 1951 by the Notary in charge of the Notaries Office No. 21 of the Federal District 30 of Mexico and in accordance with the resolution of the First Judge in Civil Matters of the Federal District given by sentence on the 8th day of January, 1951 and was registered in all the registry offices having jurisdiction over the prop- erties described in the First Schedule thereto; and (2) A Supplemental Indenture of Mortgage executed by the said parties in the said City of Toronto on the 28th day of March, 1955 before the said Peter Scarth Osler, Notary, proto- colized by Deed No. 26,357 on the 13th day of June, 1955 by the Notary in charge of the Notaries Office No. 21 of the Federal District of Mexico and in accordance with the resolution of the Sixth Judge in Civil Matters of the Fed- e'ral District given by sentence on the 2nd day of June, 1955 and was registered in all the registry offices having juris- diction over the properties described in the Second Sched- ule thereto. The said Indenture of Mortgage and Supplemental Inden- tures are hereinafter collectively referred to as the "Prin- cipal Indenture ". Second: Under the provisions of the'Principal Indenture the Company has issued Bonds of Series A in an aggregate principal amount of $10,369,930 (U.S.) or the equivalent thereof as provided in the Principal Indenture; Bonds of Series B in the aggregate principal amount of $26,000,000 (U.S.) or the equivalent thereof as provided in the Prin- cipal Indenture; Bonds of Series C in the aggregate prin- cipal amount of $5,530,000 (U.S.); and Bonds of Series D in the aggregate principal amount of 89,076,000 pesos Mexi- can currency. The funds represented by the foregoing Bonds have been invested and used in the electric business of the Company and its Subsidiaries in the United Mexican States. Third: Pursuant to the Principal Indenture the Board of Directors of the Company has by the resolution hereinabove mentioned authorized the creation of an additional series of Bonds (hereinafter in this Exposition referred to as "Bonds of Series E") in an aggregate principal amount not exceed- 31 ing $11,000,000 (U.S.), or the equivalent thereof as here- inafter provided, to be issued for the purpose of financing certain expenditures in connection with a construction pro- gram of the Company and its Subsidiaries. Fourth: The funds represented by the Bonds of Series E have been or will be invested and used in the electric busi- ness of the Company and its Subsidiaries. Fifth: The Company and its Subsidiaries have requested the Trustee to execute this Supplemental Indenture for the purpose of creating the Bonds of Series E and establishing the terms thereof and the forms and denominations in which they may be issued. Sixth: The Company has obtained such approval of administrative authorities of the United Mexican States as is necessary to issue the Bonds of Series E and the Company and its subsidiaries have also obtained such approval of administrative authorities of the United Mexican States as is necessary to enable the Company and the Subsidiaries parties hereto to charge their respective properties referred to in the First Schedule of the Indenture of Mortgage dated as of the 1st day of February, 1950 and in the Second Sched- ule of the Supplemental Indenture of Mortgage dated as of the 28th day of March, 1955 with the payment of the prin- cipal of, premium, if any, and interest on, the Bonds of Series E as provided herein. And the said appearers firstly, secondly and thirdly above named further declare that, pursuant to the resolutions hereinabove mentioned, they do hereby proceed to execute in the names and behalf of said Company and Subsidiaries in favour of said National Trust Company, Limited, as Trustee, for the benefit of all present and future holders of the Bonds issued and to be issued as hereinbefore and hereinafter mentioned, this Supplemental Indenture rela- tive to the creation and issue of the Bonds of Series E upon the conditions and in the manner expressed in the fol- lowing articles: 32 ARTICLE ONE Interpretation SECTION 1.01. This Supplemental Indenture is a supple- mental indenture within the ieaning of the Principal In- denture, and the Principal Indenture and this Supplemental Indenture shall hereafter he read together and shall have effect so far as practicable as though all the provisions thereof and hereof were contained in one instrument; and terms used in this Supplemental Indenture shall have the same meanings as corresponding terms defined in the Prin- cipal Indenture, unless there is soihething in the subject matter or context inconsistent therewith; and without lim- iting the generality of the foregoing the term "Indenture", when not qualified by the word "Principal" or the word "Supplemental" shall mean the Principal Indenture as it may from time to time be supplemented, modified or amended by any supplemental indenture entered into pur- suant to the provisions thereof, including this Supplemental Indenture. SECTION 1.02. In this Supplemental Indenture the term "1958 Loan Agreement" means the Loan Agreement dated , .1958 between International Bank for Reconstruction and Development (hereinafter referred to as the "Bank") and the Company, as the same may from time to time be amended. ARTICLE TWO Issue of Bonds of Series E SECTION 2.01. The Bonds authorized by thi9 Supple- mental Indenture to be issued under the Indenture shall be known as and entitled "First Mortgage and Collateral Trust Bonds, Series E" and are hereinafter sometimes referred to as "Bonds of Series E". The aggregate principal amount of Bonds of Series E that may be issued hereunder is lim- 33 ited to $11,000,000 or the equivalent in currencies other than dollars. SECTION 2.02. Bonds of Series E shall bear interest at the rate of 5%% per annum or at such rates as may be provided for pursuant to Section 2.06 of this Supplemental Indenture, not in excess of 5%% per annum, until the pay- ment of,the principal thereof, such interest to be payable semi-annually on March 15 and September 15 in each year. Bonds of Series E shall mature semi-annually from Septem- ber 15, 1959 to March 1.5, 1977, inclusive, in the respective principal amounts and on the respective dates set forth in the Annex hereto. Both principal of and interest on Bonds of Series E will be payable in dollars or in such other cur- rency as may be determined pursuant to Section 2.05 of this Supplemental Indenture, at such place or places as shall be specified in the Bonds and at such additional places, if any, as the Board of Directors may from time to time determine. SECTION 2.03. Bonds of Series E shall be issuable as coupon Bonds registrable as to principal only or as fully registered Bonds without coupons in such denominations as the Board may from time to time authorize and shall be substantially in the forms set forth in Article Five of this Supplemental Indenture, with such omissions, variations and insertions as may be appropriate to express the prin- cipal amounts, interest rates, currencies, places of payment, date of issue and maturity and otherwise as may be re- quired or permitted by any provision of the Indenture or of the 1958 Loan Agreement. The Bonds of Series E of different authorized forms and denominations shall be inter- changeable in accordance with Section 3.10 of the Principal Indenture which shall be applicable thereto. SECTION 2.04. Bonds of Series E payable in dollars may, from time to time upon and after the execution and delivery of this Supplemental Indenture, be executed by the Com- pany and delivered to the Trustee and thereupon the Trus- 34 tee shall authenticate and deliver in accordance with the written order of the Company, Bonds of Series E upon compliance by the Company with the provisions of Section 5.05 of the Principal Indenture and upon receipt by the Trustee of the following: A. A resolution of the Board, or a written order of the Company authorized by general resolution of the Board, requesting the authentication and delivery pursuant to the provisions of this Section 2.04 of Bonds of Series E payable in dollars and specifying the respective dates, amounts, interest rates, serial maturities and authorized denominations of such Bonds. B. Such other orders, resolutions, certificates, opinions and documents as are required by Section 5.05 of the Principal Indenture. The aggregate principal amount of Bonds of Series E is limited to $11,000,000 or the equivalent in currencies other than dollars and, except as provided in Sections 3.10 and 3.12 of the Principal Indenture and in -this Article Two of this Supplemental Indenture, the Trustee shall not authen- ticate and the Company shall not execute or deliver Bonds of such Series in excess of such aggregate principal amount. SECTION 2.05. Whenever under the provisions of the 1958 Loan Agreement the Company is required to deliver to the Bank Bonds of Series E payable in a currency other than dollars, Bonds of Series E payable in dollars which have been authenticated and delivered by the Trustee pursuant to Section 2.04 of this Supplemental Indenture but have not been issued, sold, pledged or otherwise negotiated by the Company may be surrendered by the Company to the Trus- tee in exchange for Bonds of Series E of the same maturity and interest rate, payable in such other currency, of aggre- gate principal amount equivalent to the principal amount of Bonds so surrendered and not exceeding the principal amount so required to be delivered to the Bank. For the 35 purpose of determining such equivalent, the value of such other currency shall be as reasonably determined by the Bank. Such exchange shall be effected and such Bonds of Series E in a currency or currencies other than dollars shall be authenticated and delivered by the Trustee only upon re- ceipt by the Trustee of the following: A. A written order of the Company, dated not more than 20 days prior to the filing thereof with the Trustee, for the authentication and delivery pursuant to the provisions of this Section 2.05 of Bonds of Series E in a specified currency or currencies and specifying the respective dates, amounts, interest rates, serial maturities and authorized denominations of such Bonds. B. Bonds of Series E payable in dollars of aggregate principal amount equivalent to the principal amount of Bonds the authentication and delivery of which is re- quested and of the same maturities and interest rates, together with all coupons if any which were attached thereto at the time of authentication and delivery by the Trustee. C. An officers' certificate, dated not more than 20 days prior to the filing thereof with the .Trustee, stating: (i) that the Bonds, the authentication and delivery of which is requested, are required for delivery to the Bank pur- suant to the provisions of the 1958 Loan Agreement and will represent a principal amount of outstanding loan under the 1958 Loan Agreement equal to the principal amount of Bonds delivered; (ii) the equivalent in dollars of the principal amount of Bonds, the authentication and delivery of which is requested, and that the same has been determined in accordance with the foregoing provisions of this Section 2.05; and (iii) that the Bonds surrendered for exchange have not been issued, sold, pledged or other- wise negotiated by the Company. 36 SECTION 2.06. In addition to the foregoing, any Bonds of Series E at any time outstanding may, upon the sur- render thereof to the Trustee, be exchanged pursuant to the provisions of the 1958 Loan Agreement. The Trustee shall be fully protected in connection with any such ex- change upon receipt of an officers' certificate and opinion of counsel to the effect that such exchange is being made upon the request of the Bank pursuant to the terms of the 1958 Loan Agreement. SECTION 2.07. All Bonds surrendered for exchange un- der this Article shall have attached thereto all coupons, if any, pertaining thereto representing unmatured interest and interest that may have matured and may, by reason of default on the part of the Company, remain unpaid and all Bonds and coupons so surrendered shall be forthwith can- celled by the Trustee. The Company shall execute and the Trustee, subject to the applicable provisions hereof, shall authenticate and deliver all Bonds required to carry out any such exchange. ARTICLE THREE Redemption of Bonds of Series E SECTION 3.01. The Bonds of Series E shall be subject to redemption prior to maturity as a whole at any time or in part from time to time, at the option of the Company or in accordance with the provisions of subparagraph (b) of Section 8.01 of the Principal Indenture, upon payment of the applicable percentage of the principal amount thereof 37 set forth below under the heading "Regular Redemption Price": Regular If redeemed Redemption Price Not more than three years before maturity ....................... 1001/2% More than three years and not more than six years before maturity ........... 1011% More than six years and not more than eleven years before maturity ....... .1021% More than eleven years and not more than sixteen years before maturity . . . 1031/% More than sixteen years and not more than eighteen years before maturity. 1041/2% More than eighteen years before maturity .......................105%% together in any case with interest accrued thereon to the redemption date, upon not less than thirty days' nor more than ninety days' notice given in the manner provided in Article Ten of the Principal Indenture, by publication or otherwise as provided in Section 2.07 thereof, unless waived as provided in said Section. ARTICLE FOUR Sundry Provisions SECTION 4.01. For greater certainty it is hereby de- clared that failure to pay the principal of, or premium (if any) on, any Bond of Series E when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption, by declaration under the Indenture or by the Bank pursuant to the 1958 Loan Agreement or otherwise, shall constitute a "default" as that term is defined in Section 12.01 of the Principal Indenture. 38 SECTION 4.02. The Trustee hereby accepts the trusts in this Supplemental Indenture declared and provided for and agrees to perform the same upon the terms and conditions and subject to the provisions set forth in the Indenture. SECTION 4.03. The Principal Indenture as supplemented by this Supplemental Indenture is in all respects confirmed. ARTIOLE FIVE Forms of Series E Bonds SECTION 5.01. The following is the form of coupon Bond of Series E referred to in Section 2.03 of this Supplemental Indenture: No.. $.. . ....... THE MEXICAN LIGHT AND POWER COMPANY, LIMITED Incorporated under the laws of Canada FIRST MORTGAGE AND COLLATERAL TRUST BOND SERIES E (UNITED STATES CURRENCY) DUE MARCH (SEPTEMBER) 15, 19.. THE MEXICAN LIGHT AND POWER COMPANY, LIMITED, a cor- poration organized and existing under the laws of Canada, (hereinafter sometimes called "the Company") for value received hereby promises to pay to the bearer hereof or, if this bond be registered as to principal, to the registered owner hereof, on March (September) 15, 19........... . .. DOLLARS upon surrender of this bond, and to pay interest thereon from the date hereof, at -the rate of . % per annum, semi-annually on the 15th day of March and on the 15th day of September in each year until pay- ment of the principal hereof, payable, as to interest accru- ing prior to maturity, only upon surrender of the respective coupons attached hereto as they severally become due. 39 Both principal of and interest on this bond will be paid in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, at the office or agency of Inter- national Bank for Reconstruction and Development, in the Borough of Manhattan, in the City of New York, State of New York, United States of America. The principal of this bond, the interest accruing thereon and the premium, if any, on the redemption thereof shall be paid without deduction for and free from any taxes or fees now or at any time hereafter imposed by the United Mexican States or by any taxing or fiscal authority thereof or therein and free from any restrictions now or at any time hereafter imposed by the United Mexican States, its political subdivisions or its agencies. This bond is one of an authorized issue of bonds of the Company known as First Mortgage and Collateral Trust Bonds, all issued or issuable in one or more series under and equally secured by an Indenture of, Mortgage dated as of February 1, 1950 executed and delivered by the Company to National Trust Company, Limited (herein sometimes called "the Trustee"), to which Indenture (herein some- times called "the Indenture") and all indentures supple- mental thereto reference is hereby made for a description of the property mortgaged and charged as security for said bonds, the nature and extent of the security, and the rights, duties and immunities thereunder of the Trustee, the rights of the holders of said bonds and of the Trustee and of the Company in respect of such security, and the terms upon which bonds may be issued thereunder, to all of which the holder hereof by acceptance hereof assents. Bonds of the several series may be for varying aggregate principal 4mounts and bonds of any series may differ from other bonds of the same series and from bonds of any other series to the extent provided in the Indenture. This is one of a series of bonds designated "First Mortgage and Col- 40 lateral Trust Bonds, Series E ", of an authorized aggregate principal amount of $11,000,000 payable in United States currency or in other currencies as provided in the Inden- ture and particularly in a Supplemental Indenture dated . . , 195.. The bonds of this series mature in varying amounts semi-annually from September 15, 1959 to March 15, 1977 inclusive. The bonds of this series are subject to redemption prior to maturity as a whole at any time or in part from time to time, at the option of the Company, or through application of certain moneys in the hands of the Trustee as specified in the Indenture, upon payment of the applicable percentage of the principal amount thereof set forth below under the heading "Regular Redemption Price": Regular If redeemed Redemption Price Not more than three years before maturity ....................... 1001/2% More than three years and not more than six years before maturity ........... 1011% More than six years and not more than eleven years before maturity ....... .1021/2% More than eleven years and not more than sixteen years before maturity . . . 1031/% More than sixteen years and not more than eighteen years before maturity. . 1041/2% More than eighteen years before maturity .................... 105/8% together in any case with interest accrued thereon to the redemption date; upon prior notice given by publication at least once each week for three successive calendar weeks, the first publication to be not less than thirty days nor more than ninety days prior to the redemption date, in a news- paper customarily published on each business day and of general circulation in each of the cities where the bonds of 41 this series are payable; provided that if all of the bonds of this series at the time outstanding shall be registered, such notice may be given by registered mail in lieu of such publication; all as more fully provided in the Indenture. If this bond matures or is duly called for redemption and payment is duly provided for as specified in the Inden- ture, this bond shall cease to be entitled to the security created by the Indenture from and after the date payment is so provided for and shall cease to bear interest from and after the date of maturity or redemption, as the case may be. The Indenture contains provisions giving to bondholders certain powers specified therein, including the power to agree to any modification, abrogation, alteration, compro- mise or arrangement of the rights of the bondholders and the Trustee against the Company or against its undertak- ing, property and assets or any part thereof, whether such rights arise under the Indenture or the bonds or otherwise, which powers are exercisable either by extraordinary reso- lutions passed by the holders of 75%0 of the principal amount of the bonds (or in certain cases specified in the Indenture, of the bonds of each series) represented and voted at meet- ings held under the provisions of the Indenture or by instruments in writing signed by the holders of 75% of the principal amount of the bonds (or in certain cases specified in the Indenture, of the bonds of each series) out- standing, and resolutions so passed and instruments so signed are binding upon all the holders of outstanding bonds. If a default as defined in the Indenture shall occur, the principal of this bond may become or be declared due and payable before maturity in the manner and with the effect provided in the Indenture. If certain events provided in a loan agreement dated ...... ..... . . .I ., 1958 between International Bank for Recon- struction and Development and the Company, a copy of which has been lodged with the Trustee, shall occur and be 42 continuing, the principal of all the bonds of this series may, at the option of said International Bank, be declared, and shall thereupon become due and payable immediately in the manner and with the effect provided in said loan agree- ment. No reference herein to said loan agreement shall confer upon the holder hereof any rights thereunder or impair the obligation of the.Company to pay the principal and interest on this bond at the times and place and in the amounts and in the currency herein prescribed. This bond shall pass by delivery, except that it may be registered as to principal from time to time at the option of the bearer on registration books to be kept for the pur- pose at the principal office in the city of Toronto, Canada, of the Trustee and at such other places as the Board of Directors of the Company may from time to time specify, such registration being noted hereon, and if so registered shall pass only by transfer upon such books by the regis- tered owner hereof or his attorney authorized in writing, similarly noted hereon, unless such transfer shall have been made and registered to bearer and noted hereon, in which case it shall again pass by delivery until again registered. Such registration of this bond as to principal shall not affect the negotiability of its coupons, which shall remain payable to bearer, be treated as negotiable and pass by delivery, whether or not this bond is registered. Coupon bonds of this series, bearing all unmatured and unpaid coupons, may be exchanged at said office of the Trustee for coupon bonds of the same series or registered bonds of the same series without coupons for a like aggre- gate principal amount in authorized denominations of the same maturity, upon payment of the charges provided for in the Indenture and subject to the terms and conditions therein set forth. Neither this bond nor any of the coupons for interest hereon shall become or be valid or obligatory for any pur- 43 pose until the authentication certificate hereon shall have been signed by the Trustee. IN WITNESS WHEREOF THE MEXICAN LIGHT AND POWER COMPANY, LIMITED has caused this bond to be sealed with its Corporate Seal and to be signed by its ........... and ........... .by their facsimile signatures and has likewise caused the annexed coupons to be signed by its by his facsimile signature, all as of the ..... .. day of ....... ......., 19. THE MEXICAN LIGHT AND POWER COMPANY, LIMITED Form of Coupon $............ No..... .... On the 15th day of March (September), 19. ., THE MEXI- CAN LIGHT AND POWER COMPANY, LIMITED, upon surrender hereof, unless the bond mentioned below shall previously have become due and payable and payment shall have been duly provided therefor, will pay to the bearer at the office or agency of International Bank for Reconstruction and Development, in the Borough of Manhattan, in the City of New York, State of New York, United States of America, . . . . ....II........... ........Dollars in such coin or cur- rency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, being six months' interest then due on its First Mortgage and Collateral Trust Bond Series E, N o .............. 44 SECTION 5.02. The following is the form of fully regis- tered Bond of Series E referred to in Section 2.03 of this Supplemental Indenture: No..... $........ THE MEXICAN LIGHT AND POWER COMPANY, LIMITED Incorporated under the laws of Canada FIRST MORTGAGE AND COLLATERAL TRUST BOND SERIES E (UNITED STATES CURRENCY) DUE MARCH (SEPTEMBER) 15, 19. THE MEXICAN LIGHT AND POWER COMPANY, LIMITED, a cor- poration organized and existing under the laws of Canada, (hereinafter some.times called "the Company") for value received hereby promises to pay to the registered owner hereof, on March (September) 15, 19 . ....... ......... DOLLARS upon surrender of this bond, and to pay interest thereon from the date hereof or from the last interest date to which interest has been paid in full or made available for payment in full on outstanding bonds of this series, whichever shall be later, at the rate of . . o per annum, semi-annually on the 15th day of March and on the 15th day of September in each year, until payment of the principal hereof. 45 Both principal of and interest on this bond will be paid in such coin or currency of the United States of America as at the time of payment shall be legal tender for the pay- ment of public and private debts, at the office or agency of International Bank for Reconstruction and Development, in the Borough of Manhattan, in the City of New York, Ftate of New York, United States of America. As interest becomes due on this bond (except in case of payment at maturity or on redemption, at which time inter- est will be paid upon surrender of this bond) the Company, either directly or through the Trustee or Registrar, will mail, first class, postage prepaid, a. cheque for such interest payable to the then registered owner of this bond and addressed to him at his address as the same shall appear on the register. In the case of joint registered owners the cheque shall, unless such joint owners otherwise direct in writing, be made payable to all of such joint owners and addressed to them at the address appearing on the register in respect of their joint holding or, if more than one address so appears, at the first address so appearing. The mailing of such cheque shall satisfy and discharge the liability for interest on this bond to the extent of the sum represented thereby unless the said cheque be not paid on presentation at any of the places of payment above mentioned. In the event of non-receipt of any cheque for interest by the person to whom it is so sent as aforesaid, the Company will issue to such person a replacement cheque for a like amount upon being furnished with such evidence of non-receipt as it shall reasonably require and upon being indemnified to its satisfaction. 46 The principal of this bond, the interest accruing thereon and the premium, if any, on the redemption thereof shall be paid without deduction for and free from any taxes or fees now or at any time hereafter imposed by the United Mexican States or by any taxing or fiscal authority thereof or therein and free from any restrictions now or at any time hereafter imposed by the United Mexican States, its political sub- divisions or its agencies. This bond is one of an authorized issue of bonds of the Company known as First Mortgage and Collateral Trust Bonds, all issued or issuable in one or more series under and equally secured by an Indenture of Mortgage dated as of February 1, 1950 executed and delivered by the Com- pany to National Trust Company, Limited (herein sometimes called "the Trustee"), to which Indenture (herein sometimes called "the Indenture") and all inden- tures supplemental thereto reference is hereby made for a description of the property mortgaged and charged as secu- rity for said bonds, the nature and extent of the security, and the rights, duties and immunities 'thereunder of the Trustee, the rights of the holders of said bonds and of the Trustee and of the Company in respect of such security, and the terms upon which bonds may be issued thereunder, to all of which the holder hereof by acceptance hereof assents. Bonds .of the several series may be for varying aggregate principal amounts and bonds of any series may differ from other bonds of the same series and from bonds of any other series to the extent provided in the Indenture. This is one of a series of bonds designated "First Mortgage and Col- lateral Trust Bonds, Series E", of an authorized aggregate principal amount of $11,000,000 payable in United States currency or in other currencies as provided in the Inden- ture and particularly in a Supplemental Indenture dated . . , 195 . The bonds of this series mature in varying amouits semi-annually from September 15, 1959 to March 15, 1977 inclusive. 47 The bonds of this series are subject to redemption prior to maturity as a whole at any time or in part from time to time, at the option of the Company, or through application of certain moneys in the hands of the Trustee as specified in the Indenture, upon payment of the applicable percentage of the )rhincipal amount thereof set forth below under the heading "Regular Redemption Price": Regular If redeemed Redem pt ion Price Not more than three years before maturity 100% More than three years and not more than six years before maturity . ........ 101/% More than six years and not more than eleven years before maturity . 102% More than eleven years and not more than sixteen years before maturity 103/%o More than sixteen years and not more than eighteen years before maturity . 1041/2% More than eighteen years before maturity 15. . . . 15% t6gether in any case with interest accrued thereon to the redemption date; upon prior notice given by publication at least once each week for three successive calendar weeks, the first publication to be not less than thirty days nor more than ninety days prior to the redemption date, in a news- paper customarily published on each business day and of general circulation in each of the cities where the bonds of this series are payable; provided that if all of the bonds of this series at the time outstanding shall be registered, such notice may be given by registered mail in lieu of such pub- lication; all as more fully provided in the Indenture. If this bond matures or if this bond or any portion thereof (being $1,000 or a multiple thereof) is duly called 48 for redemption and payment is duly provided for as speci- fied in the Indenture, this bond or such portion thereof shall cease to be entitled to the security created by the Indenture from and after the date payment is so provided for and shall cease to bear interest from and after the date of maturity or redemption, as the case may be. In the event of the selection for redemption of a portion only of the principal of this bond, payment of the redemp- tion price will be made only, at the option of the Company, (a) upon presentation of this bond for notation hereon of such payment of the portion of the principal of this bond so called for redemption, or (b) upon surrender of this bond in exchange for a bond or bonds, in either registered or coupon form, for the unredeemed balance of the principal amount of this bond. The Indenture contains provisions giving to bondholders certain powers specified therein, including the power to agree to any modification, abrogation, alteration, compro- mise or arrangement of the rights of the bondholders and the Trustee against the Company or against its undertak- ing, property and assets or any part thereof, whether such rights arise under the Indenture or the bonds or otherwise, which powers are exercisable either by extraordinary reso- lutions passed by the holders of 75% of the principal amount of the bonds (or in certain cases specified in the Indenture, of the bonds of each series) represented and voted at meet- ings held under the provisions of the Indenture or by instru- ments in writing signed by the holders of 75% of the prin- cipal amount of the bonds (or in certain cases specified in the Indenture, of the bonds of each series) outstanding, and resolutions so passed and instruments so signed are binding upon all the holders of outstanding bonds. If a default as defined in the Indenture shall occur, the principal of this bond may become or be declared due and payable before maturity in the manner and with the effect provided in the Indenture. 49 If certain events provided in a loan agreement dated 1958 between International Bank for Re- • construction and Development and the Company, a copy of which has been lodged with the Trustec, shall occur and be continuing, the principal of all the honds of this series may, at the option of said International Bank, be declared, and shall thereupon becone due and payable imroediately in the ianner and with the effeet provided in said i-, :reement. No reference herein to said loan agreement shall confer upon the holder hereof any rights thereunder or impair the obligation of the Conipany to pay the principal and interest on this bond at the tiies and place and in the aionlts and in the currencv herein preseribed. Subject, to the ternis and conditions set forth in the Inden- ture and. upon payment, if the Conipany shaili so require, of the ebarges therein provided for: (a) this bond may be transferred by the registered owner hereof or his attoriney duly authorized in writing at the principal office in the city of Toronto, Canada, of the Trustee and at suchli other places as the Board of Directors of the Company Imay fron time to time specify, such transfer being noted hereon; and (b) the registered owner of this bond at his option may sur- render the same for cancellation at the said office of the Trustee and receive in exchange therefor registered bonds of other authorized denominations or coupon hearer bonds (registrable as to principal only) in authorized denomina- tions, of the saine series, maturity, and rate. of interest, of the same aggregate principal amount and payable in the same currency. Neither the Company nor the Trustee nor any Registrar shall be required to make any exclianges, registrations or transfers on any interest payment date or during the fourteen immediately preceding days. This bond shall not become or be valid or obligatory for any purpose until the authentication certificate hereon shall have been signed by the Trustee. 50 IN WITNESS WHEREOF THE MEXICAN LIGHT AND POWER COMPANY, LIMITED, has caused this bond to be sealed with its Corporate Seal and to be signed by * and ........... as of ......... ....... THE MEXICAN LIGHT AND POWER COMPANY, LIMITED SECTION 5.03. The following is the form of Trustee's authentication certificate for all Bonds of Series E: TRUSTEE'S CERTIFICATE This is one of the bonds of Series E described iii the with- in mentioned Indenture. NATIONAL TRUST COMPANY, LIMITED as Trustee By Authorized Officer And the said appearers, Messrs........ ......... and .., declare that for and in be- half of said National Trust Company, Limited, they do hereby accept the trusts hereby imposed and by their sig- natures thereby bind the said National Trust Company, Linited well and truly to perform all and singular the o0ligations hereby imposed upon it according to the tenor of the Indenture. I, the Notary, made to the parties the pertinent legal warnings. THus THEY STATED AND DECLARED in the presence of the witnesses thereto, who were and legally qualified to act as such, 51 adults, residents of the City of Toronto, County of York, Province of Ontario, Canada, and with whom I am ac- quainted. And after the appearers and witnesses have declared to have taken cognizance of this instrument and to have exempted me, the said Notary, from reading it or causing it to be read, the said appearers ratified its contents and signed with the witnesses in a single act, Messrs. G. L. Stewart, Secretary of The Mexican Light and Power Coni- pany, Limited, and of National Trust Company, Limited, sealing it with the respective Corporate Seals of the said Corporations. As To ALL OF WHICi, as to the occupations and residences of the appearers, and as to everything contained in this instrument, I, the Notary, certify. For THE MEXICAN LIGHT AND POWER COMPANY, LIMITED For COMPANIA DE LTz v FUERZA DE PACHUCA, S.A. For COMPANIA DE FITERZA DEL SUROESTE DE MEXICO, S.A. For COMPANIA MEXICANA MERIDIONAL DE FUERZA, S.A. For COMPANIA DE Luz Y FTERZA ELECTRICA DE TOLUCA, S.A. For COMPANIA MEXICANA HIDRO-ELECTRICA Y DE TERRENOS, S.A. For EDIFICIO DE Luz v FUERZA, S.A. For L. M. GUIBARA, SUCESORES, S. EN C. For NATIONAL TRuST COMPANY, LIMITED WITNESSES: NOTARY 52 ANNEX Schedule of Maturities BONDS OF SERIES E in the principal amount of $11,000,000 U.S. currency. Principal Amount Date of Maturity of Maturity Sept. 15, 1959 $180,000 March 15, 1960 186,000 Sept. 15, 1960 191,000 March 15, 1961 196,000 Sept. 15,1961 202,000 March 15, 1962 207,000 Sept. 15, 1962 213,000 March 15, 1963 219,000 Sept. 15, 1963 225,000 March 15,1964 232,000 Sept. 15, 1964 238,000 March 15,1965 245,000 Sept. 15, 1965 252,000 March 15, 1966 259,000 Sept. 15, 1966 266,000 March 15, 1967 274,000 Sept. 15, 1967 281,000 March 15, 1968 289,000 Sept. 15, 1968 297,000 March 15, 1969 306,000 Sept. 15, 1969 314,000 March 15, 1970 323,000 Sept. 15, 1970 332,000 March 15,1971 342,000 Sept. 15, 1971 351,000 March 15,1972 361,000 Sept. 15, 1972 371,000 March 15, 1973 382,000 Sept. 15, 1973 392,000 March 15, 1974 403,000 Sept. 15, 1974 415,000 March 15, 1975 427,000 Sept. 15, 1975 438,000 March 15, 1976 451,000 Sept. 15, 1976 463,000 March 15, 1977 477,000