CREDIT AGREEMENT WITH TRUST GUARANTEE, ENTERED INTO:
A) AS PARTY OF THE FIRST PART AND BORROWER, BANCOMER,S.A. INSTITUCION DE BANCA
MULTIPLE, GRUPO FINANCIERO, HEREINAFTER DENOMINATED "BANCOMER,", HEREBY
REPRESENTED BY MESSRS. ENGINEER ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ THIERRY AND ENGINEER ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇.
B) AS PARTY OF THE SECOND PART, AND BORROWER, C.R. RESORTS CAPITAL, SOCIEDAD DE
RESPONSABILIDAD LIMITADA DE CAPITAL VARIABLE, HEREINAFTER DENOMINATED THE
"BORROWER", REPRESENTED HEREUNDER BY MR. ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
C) AS PARTY OF THE THIRD PART, AS FOUNDER OF THE PORTFOLIO, C-R- RESORTS PUERTO
VALLARTA, SOCIEDAD DE RESPONSABILIDAD LIMITADA DE CAPITAL VARIABLE, HERINAFTER
DENOMINATED THE "FOUNDER OF TRUST 1," HEREIN REPRESENTED BY MR. ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇;
D) AS PARTY OF THE FOURTH PART AS FOUNDER OF THE PORT- FOLIO, C.R. RESORTS
CANCUN, SOCIEDAD DE RESPONSABILIDAD LIMITADA DE CAPITAL VARIABLE, HEREINAFTER
DENOMINATED "FOUNDER OF TRUST 2," HEREIN REPRESENTED BY MR. ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇;
E) AS PARTY OF THE FIFTH PART, AS FOUNDER OF THE PORTFOLIO AND REAL ESTATE, C.R.
RESORTS LOS CABOS, SOCIEDAD DE RESPON- SABILIDAD LIMITADA DE CAPITAL VARIABLE,
HEREINAFTER DENOMINATED "FOUNDER OF TRUST 3," HEREIN REPRESENTED BY MR. ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
F) AS PARTY OF THE SIXTH PART, AS FOUNDER OF THE REAL ESTATE, DESARROLLOS
TURISTICOS INTEGRALES DE COZUMEL, SOCIEDAD DE RESPONSAABILIDAD LIMITADA DE
CAPITAL VARIABLE, HEREINAFTER DENOMINATED "FOUNDER OF TRUST 4," HEREIN
REPRESENTED BY MR. ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
G) AS PARTY OF THE SEVENTH PART, FOR THE EFFECTS HEREINBELOW INDICATED,
CORPORACION MEXITUR, SOCIEDAD DE RES- PONSABILIDAD LIMITADA DE CAPITAL VARIABLE,
HEREINAFTER DENOMINATED "MEXITUR", HEREIN REPRESENTED BY MR ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇;
H) AS PARTY OF THE EIGHTH PART, FOR THE EFFECTS HEREIN- BELOW INDICATED, CLUB
▇▇▇▇▇▇, SOCIEDAD ANONIMA DE CAPITAL VARIABLE, HERINAFTER DENOMINATED "▇▇▇▇▇▇,"
HEREIN REPRE- SENTED BY MR. ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇; AND
I) PARTY OF THE NINTH PART, AS TRUSTEE, FIANZAS MONTERREY AETNA, SOCIEDAD
ANONIMA, GRUPO FINANCIERO BANCOMER, HEREINAFTER DENOMINATED "THE TRUSTEE,"
HEREIN REPRESENTED BY ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇.
ALL OF THE ABOVE PURSUANT TO THE FOLLOWING ANTECEDENTS,
DECLARATIONS AND CLAUSES:
A N T E C E D E N T S
I.- CONSTITUTION OF THE BORROWER, FACULTIES AND POWERS-OF ATTORNEY.
The Accredited declares, thrrough its representative that: 0 It is a
company with limited responsibility, duly,constiuted and existing, as
evidenced in public instrument fifty thousand eight hundred fifty seven
dated Augusteleven nineteen hundred ninety seven, granted before Notary
Public number two hundred thirty one in the Federal District, Attorney ▇▇▇▇
de Angoitia ▇▇▇▇▇▇▇, recorded in the Public Registry of Commerce in the
Federal District, under mercantile page No. 225,005.
B) Its corporate object includes de execution of operations such as those
contemplated hereunder.
C) Its representative herunder has sufficient faculties to enter into this
contract and that these faculties have not been revoked, limited nor
modified in any way, as evidenced in the Public Instrument mentioned in
antecedent 1 (A) above.
D) On December first nineteen hundred ninety seven, it carried out in the
city of New York, New York, jointly with Club ▇▇▇▇▇▇ Resorts, Inc.
(currently Raintree International Inc., ) an emission of securities made of
1
of warrants and promissory notes, for the total amount of US$100,000,000.00
(ONE HUNDRED MILLION DOLLARS) United States of America legal currency, with
interest at the rate of 13% (THIRTEEN PERCENT) per annum, payable
half-yearly on the first of June an on the first of December each year,
beginning on the first of June nineteen hundred ninety eight and ending on
the first of December year two thousand and four.
E) It has requested BANCOMER to open a simple credit, nominated in UDIS;
for the principal amount up to the equivalent on the date of disposal of US
$7,000.000 (SEVEN MILLION DOLLARS 00/100) United States of Americal legal
currency, which shall be subject to the terms and conditions hereunder
agreed, for the purpose of guaranteeing, and in its, case, covering to the
holders of the securities described in the foregoing paragraph regarding
the payment of interest, and for the payment of expenses related with this
operation.
II. CONSTITUTION OF FOUNDER OF TRUST 1, FACULTIES AND POWERS-OF ATTORNEY. The
FOUNDER OF THE TRUST declares, through its representative, that:
A) The FOUNDER OF TRUST 1 is a company with limited responsibility and
variable capital, duly constituted and existing, as evidenced in public
instrument fifty five thousand nine hundred thirty dated August eighteen
nineteen hundred ninety seven, granted before Notary Public number one
hundred three in the Federal District, Attorney ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇▇▇, recorded in the Public Registry of Commerce in the Federal
District,under mercantile paage No. 102.373-
B) Its corporate object includes the granting of guarantees and the
execution of operations such as those contemplated hereunder.
C) Its representative hereunder has suficient faculties to enter into this
contract, which have not been revoked, limited nor modified in any way, as
evidenced in Public Instrument No. 51,260 dated December twenty two
nineteen hundred ninety seven, granted before Notary Pulic number two
hndred thirty in the Federal District, Attorney ▇▇▇▇ de Angoitia ▇▇▇▇▇▇▇.
D) It has commercial and associated relationships with THE BORROWER; from
which a direct benefit arises upon guaarnteeing the fulfillment of the
obligations that it assumes, and it is therefore willing to guarantee the
fulfillment of each every one of the obligations derived to the BORROWER in
accordance with this document and other documents related thereto.
III.- CONSTITUTION OF FOUNDER OF TRUST 2, FACULTIES AND POWERS-OF-ATTORNEY. The
FOUNDER OF THE TRUST declares, through its representative, that
A) FOUNDER OF TRUST 2 is a company with limited responsibility and variable
capital duly constituted and existing, as evidenced in public instrument
dated granted before Notary Public number in the Federal District,
Attorney, recorded in the Public Registry of Commerace, under mercantile
page No. _ _ _ _ _ .:
1 Its corporate object includes the granting of guarantees, and
executing operations such as those contemplated hereunder.
2 Its representative hereunder has sufficient faculties to enter into
this contract, which have not been revoked, limited, nor modified in
any way, as evidenced in Public Instrument No. dated before Notary
Public number in the Federal District, attorney
3 It has commercial and associated relationships with the BORROWER,
from which a direct benefit arises upon guaranteeing the fulfillment
of the obligations assumed , and it is therefore willing to gurantee
the fulfillment of each and every one of the obligations derived to
the BORROWER in accordance with this instrument and other documents
related thereto.
IV.- CONSTITUTION OF FOUNDER OF TRUST 3, FACULTIES AND POWERS-OF- ATTORNEY. THE
FOUNDER OF THE TRUST declares, through its representataive, that:
A) FOUNDER OF TRUST 3 is a company with limited responsibility with
variable capital duly constituted and existing, as evidenced in public
instrument, dated granted before Notary Public number in the Federal
District, Attorney, recorded in the Public Registry of Commerce in the
Federal District, under mercantile Page No. _ _ _ _ _
2
B) Its corporate object includes the granting of guarantees and the
execution of operations suchas those contemplated hereunder.
C) Its representataive hereunder has sufficient faculties to execute this
operation,. which have not been revoked, limited nor modified in any way,
as evidenced in Public Instrument No. dated, granted before Notary Public
number in the FederalDistrict, attorney
D) It has commercial and associated relationships with the BORROWER, feom
which a direct benefit arises upon guaranteeing the fulfillment of the
obligations assumed hereunder and, therefore, it is willing to guarantee
the fulfillment of each and every one of the obligations derived to the
BORROWER in accordance with this document and other documents related
thereto.
V.- CONSTITUTION OF FOUNDER OF TRUST 4, FACULTIES AND POWERS-OF-ATTORNEY. The
FOUNDER OF THE TRUST declares through its representative that:
A) FOUNDER OF THE TRUST 4 is a company with limited responsibility with
variable capital, duly constituted and existing, as evidenced in public
instrument dated, granted before Notary Public number in the Federal
District, attorney recorded in the Public Registry of Commerce in the
Federal District, under Mercantile page No. _ _ _ _
B) Its corporate object includes the granting of guarantees and the
execution of operataions such as those contemplated hereunder.
C) Its representative hereunder has sufficient faculties to execute the
same, which have not been revoked, limited or modified in any way, as
evidenced in Public Instrument dated granted before Notary Public number
for the Federal District, attorney
D. That it has commercial and associated relationships with the BORROWER,
from which a direct benefit arises upon guaranteeing the fulfillment of
each and every one of the obligations derived to the BORROWER in accordance
with this document and other documents related thereto.
VI.- CONSTITUTION OF MEXITUR, FACULTIES AND POWERS-OF-
ATTORNEY.
MEXITUR declares, through its representative, that:
A) MEXITUR is a company with limited responsibility with variable capital,
duly constituted and existing, as evidenced in public instrument, dated
granted before Notary Public number in the Federal District, Attorney,
recorded in the Public Registry of Commerce in the Federal District, under
Mercantile Page No. _ _ _ _.
B) Its corporate object .includes the commercialization and collection of
time-share, and the execution of operations such as those contemplated
hereunder.
A) i
B) Its representative hereunder has sufficient faculties to execute the
same, which have not been revoked, limited nor modified in anyway, as
evidenced in Public Instrument No., dated, granted before Notary Public
Number in the Federal District, Attorney _ _ _ _.
C) That it agrees to carry out the operations and activities derived
hereunder, particularly to act as Depositary of the Portfolio, to carry out
the collections, and to act as depositary of the product of the said
collections.
VI.- CONSTITUTION OF ▇▇▇▇▇▇, FACULTIES AND POWERS-OF-ATTORNEY. ▇▇▇▇▇▇ declares,
through its representative, that:
A) ▇▇▇▇▇▇ is a sociedad anonima with variable capital, duly constituted and
existing, as evidenced in public instrument, dated, granted before Notary
Public number in the Federal District, Attorney , recorded in the Public
Registry of Commerce in the Federal District under mercantile Page No. _ _
_ _
B) Its corporate object includes the commercialization and operation of
time-share clubs and the execution of operations such as those contemplated
hereunder.
3
C) Its representative hereunder has sufficient faculties to execute the
same, which have not been revoked, limited nor modified in any way, as
evidenced in Public Instrument No. dated, granted before Notary Public
number for the Federal District, Attorney .
D) That it agrees to carry out the operations and activities derived
hereunder and accepts the corresponding responsibilities.
VII.- CONSTITUTION OF THE TRUSTEE, FACULTIES AND POWERS-OF ATTORNEY The Trustee
declares, through its representaataive that:
A) It is a bonding institution, duly authorized to perform as trustee in
trust agreements in guarantee.
B) That its representative hereunder has sufficient faculties to execute
the same, which have not been revoked, limited nor modified in any way.
IX.- CONSTITUTION OF BANCOMER, FACULTIES AND POWERS-OF-ATTORNEY. BANCOMER
declares,through its representative, that:
A) It is a multiple bank institution, duly authorized to carry out the
operations inherent to its corporate object.
B) Its representative hereunder has sufficient faculties to execute the
same, which have not been revoked, limited nor modified in any way.
PRELIMINARY STATEMENTS
I- The BORROWER declares that:
a) The execution, delivery and fulfillment of the Contract hereunder and
the Promissory Note through its representative, are operations inherent to
its corporate object which have been duly authorized and do not violate its
constitutions or its corporate statatutes, nor any contractual retriction
or law, regulation or order from any government organism which may obligate
or affect the BORROWER or any of its properties.
b) The Contract hereunder and the Promissory Note, once subscribed and
signed by the BORROWER, shall constitute the BORROWER's legal and valid
obligations, demandable against it in accordance with the respective terms.
c) The existence of any legal action or judicial proceeding is not pending
nor hasthe BORROWER been notified about the existence of any legal action
or judicial proceeding which affect or may affect substantially and
adversely its financial operations, or the legitimacy, validity or
enforceability of the Contract hereunder and/or the Promissory Note.
d) Up to the date of this Contract, it has not been subject to any strike,
nor has it been summoned to any strike, and as far as it knows, it is not
attempted to present against it any action by its employees which might
affect its financial condition or its operations, or which might affect the
legitimacy, validity or enforceability of this Contract and/or the
Promissory Note.
e) It is not in default on debts or contracts in which it participates, or
through which it could be commited, at the date of this contract.
f) It has applied to BANCOMER for a simple credit denominated in UDIS, with
a fiduciary guarantee, equal to up to the principal amount of US
$7,000,000.00 legal currency of the United States of America on the date of
its disposal, which shall be applied to warrant, and in its case, to cover
the payment of interests to the holders of the securities described in
Antecedent I (D) hereunder, and to the payment of expenses related to this
operation.
II.- THE FOUNDERS OF THE TRUST declare that they are willing to guarantee the
fulfillment of the BORROWER'S obligations, in accordance with the contract
here-under through the constitutions of Trusts in Guarantee on (a) certain
collection rights resulting from the sale to the public of Memberships; (b) the
Maintenance Fees which will serve to conserve the value of the Portfolio; and c)
the Real Estate in Trust, all of which is defined hereinafter.
4
III.- BANCOMER declares through its representatives, that it is willing to open
the credit requested to the BORROWER, subject to the fulfillment of the terms
and conditions, herein contemplated.
By virtue of the above, the parties agree to the following
C L A U S E S
FIRST.- DEFINITIONS AND ACCOUNTING TERMS.
A) Definitions.
When used in this Contract, the terms set forth below shall have the
meaning herein indicated, which shall be applicable both in the
singular and in the plural forms:
"Portfolio",.- Means the collection rights derived from the present
and future accounts payable denominated in UDIS and in Pesos,
resulting to physical or moral parties acquiring Memberships from the
FOUNDERS OF THE TRUST, regarding all matters that by fact or by right
may correspond to them, including their accessory rights,affecting the
Portfolio and Fees Trust. In the amounts payable or effectively paid
by the FOUNDERS OF THE TRUST.
"Maintenance Contract." Means the maintenance contract executed with
Starwood for each of: FOUNDER OF TRUST 1, FOUNDER OF TRUST 2, and
FOUNDER OF TRUST 3, so that Starwood may provide the preventive and
corrective maintenance service at the above mentioned FOUNDERS'
facilities.
"Credit" Means the credit denominated in UDIS opened by BANCOMER to
the BORROWER, pursuant to the terms of the contract hereunder, up to
the the principal amount, equal to, on the date of its disposal,
US$7,000.000.00 (SEVEN MILLION DOLLARS 00/100 ) Currency of the United
States of America.
"Maintenance Fees.-" Means the fees which the purchasers of
Memberships shall pay to FOUNDERS 1, and 3, accordingly, with which
Starwood and other third parties providing maintenance service to the
FOUNDERS' facilities shall be paid.
"Bond RRI Coupon.-" Means the coupon corresponding to the payment of
net interest derived from the emission, in the amount of
US$6,500,000.00 SIX MILLION FIVE HUNDRED THOUSAND DOLLARS 00/100),
plus the applicable taxes payable on June first and December first
each year.
"Working Day".- MeansMeans a day when banks are open to the public to
carry out operations, or are not authorized to close in Mexico City,
D.F.
"Disposal.-" Means the disposal of funds from the credit carried out
by the BORROWER on the Date of the disposal, as covered by the
Contract hereunder.
"Credit Documents.-" Means the contract hereunder, the Promissory
Note, the Trusts in Guarantee and other documents in connection with
this contract.
"DOLLARS" AND "U.S. $.-" MeansDollars, legal currency of the United
States of America.
"Emission.-" Means the emission of securites, made up of warrants and
promissory notes carried out by the BORROWER on December first 1998,.
jointly with Club ▇▇▇▇▇▇ Resorts, Inc, (currently Raintree Resorts
International, Inc.) in the city of New York, New York, for a total
amount of US $100,000,000.00 (ONE HUNDRED MILLION DOLLLARS 00/100)
legal currency of the United States pf America, with interest at the
rate of 13% (THIRTEEN PERCENT) per annum, payable half-yearly, on June
first and December first each year, beginning on June first 1998, and
ending on December first, year 2004.-
"Date of Disposal".- Means the date which occurs forty eight Working
Hours before December first nineteen hundred ninety nine, when the
BORROWER may dispose of the total amount of the Credit..
5
"Date of Payment of Principal and Interest.-" Means the last day in
each Interest Period, and any other date when the BORROWER shall make
a payment of the principal sum or ordinary interests of the Credit and
Promissory Note in favor of BANCOMER in accordance with the provisions
established hereunder. Assuming that anyDate of Payment of Principal
and Interests should fall on a date that is not a Working Day,. the
said Date of Payment of Principal and Interest shall be understood to
be extended to the immediately following Working Day, and this
extension shall be included in the corresponding calculation of
interests.
"Trust Cabo San ▇▇▇▇▇.-" Means the trust in guarantee which FOUNDER OF
TRUST 3 constitutes with the Trustee on this date to warrant the
fulfillment of the obligations derived from the Credit Documents, to
which it shall contribute the Cabo San ▇▇▇▇▇ Real Estate.
"Trust Cozumel.-" Means the trust in guarantee which FOUNDER OF TRUST
4 constitutes with the Trustee on this date to warrant the fulfillment
of the obligations. derived in the Credit Documents, to which it shall
contribute the Cozumel Real Estate.
"Trust on Portfolio and Fees.-" Means the trust in guarantee and the
payments which FOUNDERS OF TRUSTS 1, 2 and 3 constituted with the
Trustee on this date to guarantee the fulillment of the obligations
derived from the Credit Documents- to which the Portfolio, the
Maintenance Fees and the Real Estate in Trust shall be contributed.
"FOUNDER OF TRUST 1" Refers to C.R. Resorts Puerto Vallarta, S. de
▇.▇. de C.V-
"FOUNDER OF TRUST 2" Refers to C.R. Resorts Cancun, S. de ▇.▇. de C.V.
"FOUNDER OF TRUST 3" Refers to C.R. Resorts Los Cabos, S. de ▇.▇. de
C.V..
"FOUNDER OF TRUST 4" Refers to Desarrollos Turisticos Integrales de
Cozumel, S. de ▇.▇.▇▇ C.V.
"FOUNDERS OF TRUSTS" Refers, collectively, to FOUNDER OF TRUST 1,
FOUNDER OF TRUST 2, FOUNDER OF TRUST 3 AND FOUNDER OF TRUST 4.
"TRUSTEE" Refers to Fianzas Monterrey Aetna, Bonding Institution,
BANCOMER Financial Group, or anyother fiduciary institution designated
by common agreement by the parties.
"AFFILIATE" Refers to any company wherein the BORROWER or any of the
FOUNDERS OF THE TRUST may be titleholders of stock of the coraporate
cpital, in a proportion below 25% (TWENTY FIVE PERCENT)
"MAINTENANCE FUND.-" This has the meaning attributed to the said term
in Clause EIGHTEENTH hereunder.
"PAYMENT FUND.-" This has the meaning attributed to the said term in
Clause EIGHEENTH hereunder.
"WORKING HOURS" Means the hours that are understood to be bank working
hours in the City of New York, New York, United States of America.
"CABO SAN ▇▇▇▇▇ REAL ESTATE.-" Means the real estate owned by FOUNDER
OF TRUST 3, located at San ▇▇▇▇ del Cabo, Baja California Sur,
acquired through public instrument number 36,979 on June 8, 1998,
granted before Notary Public number seven in the State of Baja
California sur, Attorney ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, and recorded in the
Public Registry of Property in San ▇▇▇▇ del Cabo, Baja California Sur,
under number _ _ _ volume :_ _ _ _ _, First Section, on _ _ _ _ _ _ _
_ _ _ _ _ , including land, improvements and constructions.
"COZUMEL REAL ESTATE.-" Means the real estate owned by FOUNDER OF
TRUST 4, located at Cozumel, ▇▇▇▇▇▇▇▇ Roo, acquired through public
instrument Number 4,378 dated November 126, 1996, granted before
Notary Public number four In the state of ▇▇▇▇▇▇▇▇ Roo, Attorney Bello
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and recorded in rhe Public Registry of Property in
Cozumel, ▇▇▇▇▇▇▇▇ Roo, under number _ _ _ volume _ _ _ Section First,
on __ ___ _ _ _ _ _ _ __ _ _ _ including land, improve- ments and
constructions.
6
"Real Estate under Trust.-" This refers jointly to the Cabo San ▇▇▇▇▇
Real Estaate and the Cozumel Real Estate.
"Memberships" Means the vacational periods in time-share only
corresponding to the use of vacational units in the FOUNDERS OF
TRUSTS' facilities, which are derived from the purchase of series "B"
shares in ▇▇▇▇▇▇, and to the membership contracts executed with
FOUNDER OF TRUST 1, FOUNDER OF TRUST 2 OR FOUNDER OF TRUST 3, which
form the Portfolio, through which concepts the initial payments and
the periodical monthly amortizations, interests, commissions,
collection expenses, Maintenance Fees and in general, any other
concept inherent to the payment shall be carried out.
"Mexico" refers to the United Mexican States.
"Promissory Note" refers the series of thirty promissory notes for a
period of one month, subscribed by the BORROWER in favor of BANCOMER,
documenting its debt additionally, which shall be written under terms
acceptable to BANCOMER.
"Interest Period.-" Means each of the monthly periods, on whose basis
the Credit interests shall be calculated. The first Interest Period
for the Disposal of this Credit shall begin on the date in which the
said Disposal is effected, and shall terminate precisely on December
29, 1999, and on this same date, the first Payment of Principal and
Interests shall occur. The second period and all the other Interest
Periods shall begin on the immediate day after the the termination of
the immediately prior Interest period and shall terminate on the
twenty ninth day of each month, except that corresponding to the month
of February each year, which shall terminate precisely on February 28
"Pesos" Means the legal currency in the United Mexican States.
"RCI" Means Resort Condominiums International, a company constituted
in accordance with the laws of the United States of America.
"RRI" Means Raintree Resorts Internation, a company constituted in
accordance with the laws of the United States of America.
"Starwood" This refers jointly, to Starwood Puerto Vallarta, S. de
▇.▇. de C.V., Starwood Cancun, S. de ▇.▇. de C.V. and Starwood Los
Cabos, S. de ▇.▇. de C.V.
"Subsidiary" Means any company in which the BORROWER or any of the
FOUNDERS OF THE TRUSTS may be titleholder of 25% (twenty five percent)
or more of the corporaate capital, or have the faculty to designate
the majority of members of the Board of Directors, or through a trust
to vote, administration contracts or other controlling vehicles which
may determine the administration of the company.
"Ordinary Rate" MeansBORROWERMeans the rate of interest of 12% per
annum.
"Textron" Means the Textron Financial Corporation, a company
constituted in accordance with the laws of the United States of
America.
"UDIS" or "Investment Units." Means the unit in the account of
constant real value determining all the payment obligations in Pesos
that may be agreed or generated due to judicial acts evidenced in this
instrument, which are regulated in the Decree establishing the
obligations that can be denominated in Investment Units, and reforms
and adds various provisions in the Fiscal Code for the Federation and
in the Income Tax Law, published in the Official Gazette of the
Federation on April first 1995.
"Securities" This refers jointly to the warrants and Promissory Notes,
derived from the emission described in antecedent I (D) hereunder.
B) Accounting terms
All the accounting terms used in this instrument and in the Credit
Documents shall be interpreted in accordance with the generally
accepted accounting principles in Mexico, issued by the Mexican
Institute of Public Accountants, unless a different meaning is
assigned hereunder.
7
SECOND. OPENING THE CREDIT.
BANCOMER hereby opens a simple credit with a fiduciary guarantee to the
BORROWER, denominated in UDIS, up to the equivalent principal sum on the
Date of the Disposal, of US $7,000,000.00 (SEVEN MILLION DOLLARS 00/100)
which do not cover the interest and expenses caused by virtue of the
contract hereunder.
The applicable rate of exchange to establish exactly the total amount of
the credit in UDIS shall be determined 48 hours prior to the Date of
Disposal.
Under the terms of Article 294 (two hundred ninety four) in the General Law
for Credit Titles and Operations, the parties agree that BANCOMER shall
have faculties to limit the amount of the credit and the period, or both at
the same time, or to denounce the credit as from a certain date or at any
time, through the simple writen notification sent to the BORROWER under the
terms of this instrument, with which the said Contract shall be considered
expired.
THIRD.- DISPOSAL OF THE CREDIT.
The BORROWER may dispose of the Credit on the Date of Disposal, up to the
equivalent principal sum on the said Date of Disposal to US $7,000,000.00
(SEVEN MILLION DOLLARS 00/100) providing it fulfills the conditions for the
disbursement provided in Clause FIFTEENTH hereunder, and intends the funds
received for the purposes described in Clause Fifth in this contract.
FOURTH.- PERIOD
The total period for the Credit is thirty months, with no period of grace,
beginning on November 29, 1999 and terminating on May 29, 2002..
FIFTH.- DESTINATION OF THE CREDIT
The destination of the Credit is to warrant, and in its case to cover, to
the holders of the of bonds resulting from the emission, the punctual
payment of the amount of US $6,500,000.00 (SIX MILLION FIVE HUNDRED
THOUSAND 00/100 DOLLARS) corresponding to half-yearly interest at the rate
of 13% per annum, payable on the first of December 1999 under the terms of
the Emission, and to finance the BORROWER for the Income Tax on interest
paid in accordance with the Emission, commisions and expenses for this
Credit.
SIXTH.- PAYMENT OF THE CREDIT
The BORROWER shall return the principal amount of the Credit through thirty
successive monthly amortizations, substantially equal, beginning the first
Payment Date of Principal and Interests on December 29, 1999, and these
shall be covered at the value of UDIS on the date in which the
corresponding Date of Payment of Principal and Interests occurs.
SEVENTH.- ANTICIPATED PAYMENTS.
In the event that the BORROWER should decide to pay totally or partially
the unpaid balance of the Credit, it shall send BANCOMER a written
notification 5 (five) natural days in advance, indicating the date in which
the anticipated payment shall be made and the amount of same, in the
understanding that all anticipated payments shall 1) be made on the Date of
Payment of the Principal; and 2) be made together with the accumulated
unpaid interest up to the date of the said anticipated payment.
The above mentioned prepayments are not subject to premium or penalty, but
if the anticipated payment is made on a date different from a Date of
Payment of Principal and Interest, the BORROWER shall pay BANCOMER an
amount equal to the amount which BANCOMER has to pay to its source of funds
for making prepayments on dates different from a Date of Payment of
Principal and Interest. This amount shall be determined by BANCOMER at the
time when the BORROWER notifies the prepayment, under the terms above
provided, and shall be payable jointly with the anticipated payment.
8
EIGHTH.- COMMISSIONS AND INTEREST
I Opening Commission
The BORROWER shall pay BANCOMER, on the date of execution of this contract,
an opening commission in the amount of US $105,000.00, equal to 1.50% (ONE
POINT FIFTY PERCENT) of the principal sum of the Credit, plus the
corresponding Value Added Tax, for an aggregate of US$120,750.00.
II. INTEREST
The Accredited shall pay ordinary and penalty interest, as the case may be
on the principal unpaid amount of the Credit, calculated on the basis of
one commercial year with 360 (three hundred sixty) days by the number of
natural days which have effectively elapsed, from the date in which the
Disposal is made, and up to the total and complete payment, calculated as
follows:
1) Ordinary interest: THE BORROWER shall pay on each Date of Payment
of Principal and Interest, ordinary interest on unpaid balances of the
principal amount of the Credit, calculated at the Ordinary Rate.
2) Moratorium interest: In the event of a moratoruium, this shall
cause interest on the expired and unpaid balances of the Credit, at
the annual rate resulting from multiplying the Ordinary Rate in effect
on the date of payment by 1.50 (ONE POINT FIFTY). The Moratorium
interest shall be caused as long as the delay lasts, as from the date
in which the default originates and up to the total payment, and shall
be payable on sight.
NINTH.- APPLICATION OF PAYMENTS
Each amount received by BANCOMER under this Contract for the payment of the
Principal sum, commissions, interests and Credit accessories, shall be
applied as far as it may be sufficient, to the payment of the obligations
derived from this contract, in accordance with the following order of
precedence:
In the first place, for the payment of each and every expense and cost in
which BANCOMER may have incurred, due to obtaining the obligatory
fulfillment of the obligations derived hereunder, assuming that any default
should occur to any of the Credit Documents;
In second place, the remaining amount after liquidating the above mentioned
concepts, shall be applied to the payment of moratorium interests earned up
to the date in which the corresponding payment is made.
In third place, the remainder after liquidating the above mentioned
concepts shall be applied to the payment of ordinary interests earned up to
the date in which the corresponding payment is made.
In the fourth place, the remainder after liquidating the above mentioned
concepts shall be applied to the payment of the monthly installments for
the principal unpaid balance of the Credit, in an inverted order to its
dates of maturity, beginning with the most distant date.
The above shall be applied without detriment to the provisions contained in
Clause Ninth in the Portfolio and Fees Trust Agreement.
TENTH.- EXPENSES
All the reasonable expenses in connection with this Contract, as well as
registrations and cancellations in the Public Registries of Property,
notarial fees and expenses, Trustee's reasonable fees and expenses, as well
those of its technical committee, administration expenses for the Trust,
fees, expenses and taxes caused by the assessment of the Portfolio to
warrant the fulfillment of this Contract, as well as the half-yearly
revisions carried out under the terms hereunder, supervisor's expenses, in
the event he is designated, expenses and insurance premiums incured by
BANCOMER, travelling expenses, fees and expenses of BANCOMER'S external
legal consultants, as well as other expenses in connection with the above,
shall be paid by the BORROWER or by any of the FOUNDERS, as soon as
BANCOMER requires the payment, without needing the intervention of a
Federal or judicial officer. BANCOMER agrees to make all the efforts within
its reach so that the amount of the above mentioned expenses are not above
the market average.
9
With reference to the above, the parties agree that a) BANCOMER shall
inform the BORROWER about all the traveling expenses and every expense that
involves important amounts (understanding as such all the amounts involving
disbursements over US. $ 2,000 per event), at least five Working Days prior
to making such disbursements; b) the BORROWER cannot deny its authorization
to make such important expenses without a justified cause; and c) in the
event that a Cause of Anticipated Maturity occurs, BANCOMER may make the
expenses it deems pertinent charged to the patrimony of the Trusts in
Guarantee, without requiring a notification or authorization.
ELEVENTH. INCREASE IN COSTS
In the event that, as a result of a) the proclamation or modification of
any law or regulation, or due to any change in the interpretation, or b)
the fulfillment of any request from any central bank or government
authority or c) the anticipated payment of all or part of the Credit's
principal sum on a date which is not a Date of Payment of Principal and
Interest, an increase in the cost should be produced for BANCOMER to obtain
funds to exhibit or to maintain in effect the Disposal of the Credit, it
shall inform the BORROWER in writing about this matter, indicating the
amount of the increase. Once this information is received, the BORROWER
shall pay BANCOMER the amounts it may indicate that are required to cover
the said increase in costs, and shall make such payments within 5 (FIVE)
Working days after the date in which the corresponding information has been
received.
TWELTH.- PLACE AND FORM OF PAYMENT
All the payments that the BORROWER shall be made in favor of BANCOMER
covered by this Contract and the Promissory Note shall be made precisely in
Pesos, in the equivalent amount of UDIS, without needing a previous
requirement, making the credit before 11:A.M. (Mexico City time), to the
account which BANCOMER may indicate in writing, or at any other place and
in any account which BANCOMER may designate through a written notification
addressed to the BORROWER ten Working Days in advance.
THIRTEENTH.- TAXES
All the amounts payable by the BORROWER shall be covered without deductions
and shall be free from any taxes, contributions, deductions or retentions
of any nature that may be imposed or encumbered at any time by any
authority.
Due to the above, the BORROWER undertakes to leave BANCOMER free and safe
from any taxes or fiscal charges derived from or related to any of the
Credit documents that may not have been paid and of which the BORROWER was
not opportunely aware. This obligation shall remain in force during the
period of prescription due to fiscal responsibilities, in accordance with
the applicable legislation.
FOURTEENTH. PROMISSORY NOTE
The Promissory Note subscribed by the BORROWER to the order of BANCOMER
under the terms of this Contract, shall be understood to be in recognition
of the amount which the BORROWER has at its disposal as an additional form
of documentation of the same.
BANCOMER may also assign or transfer this Agreement, and the assignee will
be entitled to the same rights and benefits as if it were BANCOMER.
BORROWER may not assign the rights and obligations hereunder without the
prior written consent of BANCOMER.
BANCOMER may discount, transfer, assign, endorse or negotiate the
Promissory Note prior to its maturity under the terms of the applicable
legislation, and this instrument is the specific authorization required by
Article 299 (TWO HUNDRED NINETY NINE) in the General Law for Credit Titles
and Operations.
FIFTEENTH, CREDIT CONDITIONS
BANCOMER's obligation to effect the disbursements in accordance with this
Contract is subject to the previous fulfillment of the following
conditions:
I. To deliver to BANCOMER at least 5 (FIVE)) working days prior to the
date of execution of this Contract, the original documents and
10
powers-of-attorney evidencing the BORROWER's legal existence as well
as the legal existence of each of the FOUNDERS OF THE TRUST, MEXITUR
and ▇▇▇▇▇▇, as well as the faculties of the attorneys-in-fact,
including the information regarding their registration in the
corresponding Public Registry.
II: To deliver to BANCOMER, no later than on the Date of Disbursement:
A) This instrument, duly signed by all the parties participating
in same.
B) Testimony of the public instrument through which the trust
covering the transfer of ownership in benefit of the company
denominated Promotora ▇▇▇▇▇ ▇▇▇▇, S. de ▇. ▇. de C.V. with
respect to Hotel ▇▇▇▇▇ ▇▇▇▇, located in Acapulco, Guerrero.
C) Evidence of having constituted the Trusts in Guarantee and the
Maintenance Funb, to BANCOMER'S satisfaction.
D) Evidence issued by an authorized official of the BORROWER,
stating that no default exists on its part with respect to the
positive and negative covenants hereunder and under all credit
contracts contracted in the past.
E) Evidence issued by the TRUSTEE stating that it has affected
the PORTFOLIO in a minimum proportion of 2.5 to 1(TWO POINT FIVE
TO ONE) in guarantee with respect to the total amount of the
Promissory Note, considering to this effect, the value of the
UDIS on the date of the Disposal, in the understanding that in
the event that all or part of the Portfolio should be replaced by
another in Pesos or Dollars, the parties shall determine the
applicable equivalence.
F) Certificate issued by the Trustee to the effect that it
received a deposit fo rUS$500,000.00, to form the Maintenance
Fund.
G) Evidence of having notified MEXITUR, or any other company in
charge of the Collection of the Portfolio endorsed to BANCOMER,
and of receiving the correspond-ing funds for the Maintenance
Fees, stating that it continues receiving the payments relative
to the capital, interests, anticipated payments, accelerated
amortizations and all the amounts that the clients may make in
favor of their debt, as well as such Maintenance Fees, so that
the amounts of both are concentrated in the Trust for the
Portfolio and Fees.
H) A commitment letter issued by any financing institution
satisfactory to BANCOMER, written in terms satisfactory to
BANCOMER, where the former undertakes to finance working capital
to the BORROWER, the FOUNDERS OF THE TRUST, its Affiliates and
Subsidiaries, as well as the ordinary interest derived from the
Emission, payable on June first in the year two thousand.. I) To
deliver to BANCOMER, no later than on the date of the Disposal,
the Promissory Note documenting the said Disposal, subscribed by
the BORROWER.
SIXTEENTH. POSITIVE COVENANTS
As long as any portion of the Credit is unpaid, and while the BORROWER has
any outstanding obligation to fulfill, the BORROWER, THE FOUNDERS OF THE
TRUST, MEXITUR and ▇▇▇▇▇▇ undertake to carry out the items indicated below,
unless they obtain the previous written consent from BANCOMER, exempting
them from fulfilling any of the said obligations, in which case, the said
consent shall be effective only with respect to the specific matter and
occasion for which it was granted.
A) Information requirements: To provide BANCOMER the information
indicated below;
1. As soon as available, and in any case within 45 (FORTY FIVE )
natural days after the close of each quarter in the corporate
year of BORROWER, the FOUNDERS OF THE TRUST, MEXITUR and ▇▇▇▇▇▇;
an internal quarterly financial statement for the said companies
(in the BORROWER'S specific case, the statement known as 10K in
the United States) at the close of the said quarter, which should
11
at least include General Balance sheet, Statement of Results and
Cash Flows, with its analytic reports signed by the corresponding
company's representative, that it is up to date in the
fulfillment of all the obligations To Do and Not to Do contained
in Clauses Sixteenth and Seventeenth hereunder.
2. As soon as available and in any case within 120 (ONE HUNDRED
TWENTY) natural days after the close of the fiscal yeaar of the
BORROWER and of the FOUNDERS OF THE TRUST, their respective
subsidiaries and/or affilates, a copy of their individual annual
financial stataements (in the BORROWER's and RRI's specific case,
the statement known as 10K in the Unted States) with the opinion
from one of the independent public accountant offices with the
best international prestige, or by any other that may be
acceptable to BANCOMER, as well as a letter subscribed by the
BORROWER's authorized official, stating that it is up to date in
the fulfillment of the Obligations to Do and Not to Do contained
in Clauses Sixteenth and Seventeenth hereunders.
3. Immediately after initiating or notifying any action, demand
or proceeding before any court, council, government entity or
commission, to deliver BANCOMER a notification indicating the
details of the corresponding demand or proceeding, assuming that
a) claims in connection with taxes, products, uses or
contributions to social security, local or federal, for an amount
equal to over Pesos Mexican Currency, US $250,000.00 (TWO HUNDRED
FIFTY THOUSAND DOLLARS 00/100) b) In any other case, except
bankruptcy, for an amount equal to over the equivalent to 3.0%
(THREE PERCENT) of the annual sales of any of them; or c)
requests or demands for bakruptcy or suspension of payments,
unlimited with respect to the amount involved.
4. On the date in which BANCOMER reasonably requests that any
other information be provided with respect to the financial
conditions or of any other nature from the BORROWER or from the
FOUNDERS OF THE TRUST, to deliver to BANCOMER such information,
providing that this information is immediately available..-
5. As soon as possible, but in any case within 10 (TEN) natural
days after the date in which a Cause for Anticipated Maturity
occurs, or an event that, with time, could constitute a Cause for
Anticipated Maturity, a notification from the corresponding
company's principal offical, stating the details of the said
Cause for Anticipated Maturity, and the measures that the said
company has taken or proposes to take in this respect.
6. To notify BANCOMER in writing, at least 30 (THIRTY) working
days in advance about any possible reduction of over 10% (TEN
PERCENT) of the corporate capital of the BORROWER, THE FOUNDERS
OF THE TRUST, ▇▇▇▇▇▇ and MEXITUR, or any of their respective
subsidiries.
7. As soon as possible, but in any case at least 10 (TEN)working
days in advance, to notify in writing, the expenses made from
capital or investments in fixed assets by the BORROWER or by the
FOUNDERS OF THE TRUST (different from expenses to cover
replacements or substitutions) which, considered individually or
in conjunc-tion during a fiscal yeara, amount to over US
$125,000.00 (ONE HUNDRED TWENT FIVE THOUSAND DOLLARS 00/100) per
quarter, accumulated up to a maximum of US $500,000.00 (FIVE
HUNDRED THOUSAND DOLLARS 00/100) annually, or its equivalent in
Mexican Currency, indicating the amount, destination and source
of funds to this effect.
In the event of any deviation from the amount proposed, to
explain to BANCOMER the nature of the same, so that BANCOMER may
authorize the corresponding investment, which shall not be denied
without a reason, all of which shall be under the terms of Clause
Seventeenth (F) hereunder.
8. As soon as available, but in any case within 10 (TEN) natural
days after the close of each quarter, a report regarding the
respective approvals for capital or investment expenses in fixed
assets, different from replacement or substitution expenses made
during the immediately foregoing quarter, for amounts over US
$125,000.00 (ONE HUNDRED TWENTY FIVE THOUSAND DOLLARS 00/100) oe
12
its equivalent in Pesos considering the BORROWER and the FOUNDERS
OF THE TRUST and their respected Subsidiaries and Affiliates
jointly.
9 As soon as available, but in any case within 60 (SIXTY) natural
days after the beginning of each calendar year, an executive
summary of its master operational budget applicable to the new
year, including all the proforma financial statements, (general
balance sheet,statement of results, statement of changes in the
capital and statement of changes in the financial position and
cash flow) all of which consider jointly the BORROWER and the
FOUNDERS OF THE TRUST and their respective affiliates and
subsidiaries.
A) To continue as an on-going company with no change in
their line of business.
B) To maintain their judicial personality, without modifying
its corporate object or the structure of their shares of
stock without the previous written authorization from
BANCOMER, whose consent shall not be denied without a
reason.
C) To permit BANCOMER or whomsoever it may designate to
carry out periodical visits, with a previous notification
and without interfering with the business's normal
operations, also providing the periodical information on
same which BANCOMER may reasonably request.
D) To keep insured against any insurable risk including,
without limitation, against fire, earthquake, flood,
hurricane, cyclone, storms, stormy winds, hurricane winds
and any other coverage in connection with the proper
safeguard of all and each one of the properties of which the
BORROWER, THE FOUNDERS OF THE TRUST or their respective
Affiliates and Subsidiaries may be owners or lessees, in
accordance with the standards in effect in Mexico The
corresponding policy or policies covering the properties on
which a guarantee is constituted under the terms hereunder,
shall be endorsed in favor of the Trustee, so that he may
proceed to repair the properties destined to time-share, or
to the payment of the credit. BANCOMER undertakes to
instruct the Trustee that, as long as the Guarantee Measure
is maintained, the amounts paid for insurance is for the
payment of the repairs required in the facilities and real
estate that may have been affected
F) To invoice at market prices comparable to the average in
the hotel and time-share industry, all the properties and
services provided by THE BORROWER, THE FOUNDERS OF THE
TRUST, and their respective Subsidiaries and Affiliates.
G) To maintain in the sales contracts of time-share, the
terms, conditions and period (including without limitation
the amounts for any kind of counterbenefits) similar to
those that are currently executed, and in general, to carry
out sales in competitive conditions and equivalent to those
in the maraket of developments having a similar category,
unless BANCOMER grants its written consent to modify the
same.
H) To substantially maintain in effect the preventive and
corrective maintenance programs provided in the Maintenance
Contract executed with Starwood, as well as the replacement
or substitution reserve, so that the time-share units and
the other properties in guarantee, may substantially
maintain their category of services, furnishings,
decoration, and other aspects related to those which they
currently have.
I) To maintain an investment program that ensures the
quality of the services to be provided to the clients in
each development
13
J) To assign to the anticipated payment of the Credit, as
much as may be possible, the product obtained in cash of
emissions of debt or capital at a corporate level by the
BORROWER individually, or together with other companies, in
national or international markets.
K) Maintain a percentage of overdue Portfolio of less than
10%. Overdue portfolio means Portfolio between 1 and 90
calendar days late. Portfolio overdue for more than 90 days
will not be accepted.
L) To maintain FOUNDER OF TRUST 1, FOUNDER OF TRUST 2 AND
FOUNDER OF TRUST 3, within the "Golden Crown"
--------------- distinction granted by RCI.
M) To maintain and make its respective Subsidiaries or
Affiliates keep adequate Accounting books and records, where
they shall keep complete records in accordance with
generally accepted accounting principles in Mexico and
consistently applied, reflecting all the corresponding
company's financial operations.
N) To take all the necessary measures required at any time
to obtain and to maintain in effect all the governmental
records, authorizations and approvals necessary so that the
BORROWER and the FOUNDERS OF THE TRUST may fulfill their
obligations in accordance with this Contract.
SEVENTEENTH. NEGATIVE COVENANTS
As long as any part of the Credit is unpaid, and as long any obligation is
pending fulfillment, the BORROWER and the FOUNDERS OF THE TRUST are
obligated to abstain from, and to make their respective Affiliaates and
Subsidiares abstain from carrying out any of the activities indicated
below, unless they obtain the writtenconsent from BANCOMER, in which case
the said consent or approval shall be effective only and exculusively with
respect to the specific matter and the occasion for which it was granted.
A) To carry out any substantial modification in its administrative and
sales system which might have the direct or indirect result of a
reduction or deviation of the cash flows from the use of the
time-share.
A) To contract without BANCOMER's previous written authorization, any
credit or loan, in an individual or in a Consolidated level different
from the (i) The credit alternatives described in Clause FIFTEENTH
(III) (D) hereof; (ii) the revolving lines opf credit, up to the
principal amount of US$32,500,000 entered into with FINOVA Capital
Corporation; and (iii) the credit for the purchase of Hotel ▇▇▇▇▇ ▇▇▇▇
in Acapulco, Gro., unless the product obtained is applied to the
anticipated payment of this Credit and this authorization shall not be
denied without a justified cause.
B) To totally encumber or assign the BORROWER's fixed assets or those
of any of THE FOUNDERS OF THE TRUST for an amount over US $100,000.00
(ONE HUNDRED THOUSAND DOLLARS 00/100) annually or its equivalent in
Pesos, in the understanding that this obligation is exclusively to the
BORROWER and to the FOUNDERS OF THE TRUST, excluding its fulfillment
by their respective Affiliates and Subsidiaries.
C) To grant loans or prepayments to its shareholders, parent
companies, direct orindirect third parties, or any third party, except
in payment of debts assumed prior to the date of this Contract, loans
or prepayments to its subsidiaries and affiliates, its suppliers or
its employees in accordance with the normal practices of the BORROWER
AND THE FOUNDERS OF THE TRUST and sales credits to its clients within
the normal parameters of the hotel and time-share industry, without
this imposing any restriction other than as provided in Section 4.08
of the Emission."
D) To make sales of Memberships, weeks and/or time-share units at
wholesale, both to physical and to moral parties different from the
FOUNDERS OF THE TRUST, unless a minimum of 50% of the product thus
obtained is applied to the prepayment of the Credit.
14
E) To carry out different capital or investment expenses in fixed
assets for an amount over Us $500,000.00 (FIVE HUNDRED THOUSAND
DOLLARS 00/100) annually, accumulated, unless it is a matter of
investments for replacement, substitutions, or replacement of
equipment or properties directly in relation with the operations of
the FOUNDERS OF THE TRUST, ▇▇▇▇▇▇ or MEXITUR.
F) That the BORROWER carry out any emission of debt or capital at a
corporate level, in an individual form or jointly with another
company, both in the national or in the international markets, unless
the product from the same is assigned to the pre-payment of the
Credit.
G) To reduce its corporate capital in any amount, or to pay dividends
with resources from payments of the Maintenance Fees.
EIGHTEENTH. GUARANTEE/COLLATERAL
For the purpose of preserving the correct application of the Maintenance
Fees, which in turn preseve the value of the Portfolio, and to guaranatee
the fulfillment of each and every one of the BORROWER's obligations, as
well as for the punctual and opportune payment of the principal and of the
ordinary and moratorium interest earned, charges, costs, expenses or taxes,
and any other payment obligations assumed or derived in charge of the
BORROWER under the terms hereunder, and in the other documents in
connection with the Credit, and without prejudice to responding with all
its patrimony for the obligations acquired, the BORROWER and the FOUNDERS
OF THE TRUSTS constitute the fiduciary warranty contemplated in the Trusts
in Guarantee which on this date are constituted with the Trustee, under the
terms of Exhibits "▇," "▇," and "C" hereunder, whose general
characteristics are the following:
I TRUST CABOS SAN ▇▇▇▇▇ REAL ESTATE
A) Nature: An irrevocable trust in guarantee
B) Parties:
Founder of Trust Founder of Trust 3
Beneficiary BANCOMER in the first place
Founder of Trust 3 in second place.
Trustee The Trustee
C) Matter: Cabo San Luicas Real Estate
D) Purposes: So that the Trustee may keep the Cabo San ▇▇▇▇▇ Real
Estate in guarantee for the fulfillment of the obligations .
derived from the Credit Documents, carrying out the corresponding
execution procedure when BANCOMER communicates the existence of
default, without liability for the Trustee.
E) Releases: The Trustee, by instructions fromBANCOMER, releases
the guarranty constituted on the Cabo San ▇▇▇▇▇ Real Estate.
BANCOMER shall give give the respective instructions, providing
no default has occured to the terms of the Credit documents, and
providing the two following assumptions have occured: 1) The
BORROWER has fully and punctually complied with the first seven
monthly amortiza- tions of the Credit; and 2) Total and punctual
compliance has been made of the payment of the RRI Bond Coupon,
maturing on June first in the year 2000-
II TRUST COZUMEL REAL ESTATE
A) Nature : Irrevocable trust in guarantee.
B)Parties
Founder of Trust; Founder of Trust 4
Fideicommissary: BANCOMER in the first place
Founder of Trust 4 in the second place
Trustee: The Trustee
C) Matter: Cozumel Real Estaate
15
A) Purpose: That the Trustee may keep the Cozumel real estate to
guarantee the fulfillment of the obligations derived from the
Credit Docu- ments, carrying out the corresponding execution
proceeding when BANCOMER communicates the existence of such
default, without liability to the Trustee.
III) TRUST ON PORTFOLIO AND FEES.
A) Nature; An irrevocable trust in guarantee and payment
A) Parties:
Founders of Trust
for Portfolio: Founder of Trust 1
Founder of T
Founders of Trust
for Fees Founder of Trust 1
Founder of Trust 2
Founder of Trust 3
Beneficiary: BANCOMER I in the first place
The Founders of the Trust in second place
Trustee: The Trustee.
C) Matter:
1) The Portfolio approved by BANCOMER with a value
representing at all times an equal or superior proportion to
2.5 to 1 with respect to the unpaid value of the Credit,
considering exclusively the portion of the Portfolio which
is up-to-date. To determine the indicated measurement, the
Portfolio in moratorium shall not be considered. The
FOUNDERS OF THE TRUST shall primarily affect all the portion
of the Portfolio denominated in UDIS, and only in the event
that this should be insufficient to cover the agreed
measurement, they shall affect the Portfolio in Pesos. 2)
All the Maintenance Fees
A) Purposes:
1) That the Trustee shall maintan affected in guarantee the
credit titles documenting the Portfolio, both those which
are contributed initially and those contributed later in
trust, in addition or in substitution to those existing, in
order to preserve the value of the said warranty, in order
to comply with the provisions contained in this contract and
in the Trust for the Portfolio and Fees.
2) That the Trustee, on its own behalf, or through
depositaries to whom the collection is delegated, to
collect, receive and keep the funds corresponding to the
Portfolio, including prepayments, usually denominated
"Cashouts as well as the interest earned by the Porfolio and
the total amount of the Maintenance Fees, in guarantee for
the fulfillment of the obligations derived from the Credit
Documents, carrying out the corresponding execution
procedure when BANCOMER communicates the existence of a
default, without liability for the Trustee
3) That the Trustee shall monthly apply the product from the
collection of the Portfolio in the first place, to the
constitution or re-constitution of the Payment Fund,
releasing the FOUNDERS OF THE TRUST from the excess, in the
understanding that from the moment in which the Trustee
receives instructions from BANCOMER that a default has
occurred to the terms of the Credit, the Trustee shall
deliver to BANCOMER the total amont received, to be applied
to the prepayment of the Credit.
4) That as long as the Trustee does not receive instructions
to the contrary from BANCOMER, it shall deliver to the
designated depositaries the amounts received from
Maintenance Fees, with the exception of the portion
16
corresponding to the Maintenance Fund indicated below, for
purpose of covering the total amounts to be paid for these
concepts to the respective providers of services.
5) Thaat the Trustee shall montly separate from the amounts
received for Maintenance Fees, the necessary amount fo form
a fund denominated "Maintenance Fund" in an amount not to be
under US $500,000.00, determined in accordance with the rate
of exchange at the end ofthe month, and this shall be
deposited in the account which BANCOMER shall indicate, for
the purpose of guaranteeing that at all times it shall have
at least the said sum to face the payments to Starwood for
maintenance services.
6) That the Trustee, in accordance with the procedure
established in Clause NINETEENTH in the Trust for the
Portfolio and Fees, as from the date in which it receives
instructions from BANCOMER indicating that a default has
occurred to any of the terms and conditions of the Credit or
the Trusts in Guarantee, shall deliver to BANCOMER each and
every one of the amounts it keeps and is receiving from the
25 Portfolio, Maintenance Fees, or any other, to be applied
under the terms which BANCOMER shall indicate, in the
understanding that BANCOMER shall apply the Maintenance Fees
in the first place to pay Starwood and MEXITUR.
7) All those provided in the Trust for the Portfolio and
Fees.
Besides the above, BANCOMER shall contract an external accounting
auditor, who may be from REGINA's current auditors' office, to
carry out an aleatory sample of the Portfolio, always different
and statistically selected, for the purpose of examining
half-yearly:
* The Control of Collections (the correct application of
payments, for automatic charges and on-site payments, calendar of
payments, control and application in the collection of interests,
etc.).
Overdue Portfolio not exceeding 90 calendar days.
Promissory notes properly documented (amount, signatures,
date of payment)
Promissory Notes properly endorsed in favor of the Trustee.
One of the monthly reports for the immediately foregoing
semester.
MEXITUR shall also prepare, under its responsibility, a
monthly report of the Portfolio, under the terms of the
Trust for the Portfolio and Fees.
NINETEENTH. CASES OF ANTICIPATED MATURITY
BANCOMER may consider as anticipated expiry of the period for the Credit
herein stipulated, and demand the payment of the balance of the principal
amount of the Credit and the Promissory Note, together with the accumulated
and unpaid interest, and other amounts that should be paid, in the event
that BORROWER, any of the FOUNDERS OF THE TRUST, ▇▇▇▇▇▇, MEXITUR, or any of
the respective Subsidiaries default on any of the obligations derived from
the Credit Documents or from any other document in connection thereto, at
all times complying with the periods provided for in the execution
proceedings set forth in the Guaranty trusts, including without limitation,
the following:
A) In the event that the BORROWER fails to punctually pay an
exhibition of Capital, interest or commissions in accordance with the
provisions established here_ under and/or in the Promissory Note that
are subscribed, and other amounts payable in accordance with the
Credit Documents-.
B) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST
default with any other credit contract executed with any third party,
if such default results in the anticipated expiry of the said credit.
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C) In the event that (i) Starwood, MEXITUR or ▇▇▇▇▇▇ fail to provide
their services or (ii) if they terminate the service or the operation
and maintenance contract with Starwood, unless within the following 60
working days after the situation, a third party begins to provide the
said services at an efficiency level comparable to that which is
currently provided.
D) In the event that ▇▇▇▇▇▇ ceases to be depositary of the rights of
use of weeks or Time-share intervals in any of the facilities of the
FOUNDERS OF THE TRUST.
E) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST
should encumber or alienate any of its fixed assets registered in
their acounting on the date of execution of this instrument, exceeding
US $100,000.00 (ONE HUNDRED THOUSAND DOLLARS 00/100) annually, with
the exception of those encumbered with this Credit.
F) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST
i) should declare itself in bankrupcy or in suspension of payments;
ii) if it is intervened by any authority; iii) if it admits in writing
its incapacity to pay its debts upon maturity; iv) if it makes a
general assignment of properties in benefit of creditors; or (v) if it
begins and continues during more than sixty natural days, any
proceeding through which it seeks any of the above, or vi) in the
event that situations should arise affecting the BORROWER'S or the
FOUNDERS OF THE TRUST'S, REGINA'S or MEXITUR's good operations, or of
any of its respective Subsidiaries that can endanger the economic or
financial stability of any one of them.
G) In the event that any of the Trusts in Guarantee are not
constituted in accordance with the agreements contained hereunder, if
it fails to have the desired effects of the value of the guarantee or
declines in such a way that it does not comply ith the measurements
herein provided, or in the event that due to any cause the FOUNDERS OF
THE TRUST apply the funds from the Collection of Memberships or Fees
for the payment of debts of any other kind
H) In the event that the BORROWER'S stockholders meetings, or of any
of the FOUNDERS OF THE TRUST, ▇▇▇▇▇▇, MEXITUR, or of any of their
respective Affilates or Subsidiaries should at any time during the
period of the credit, resolve to decree the payment of dividends,
applying amounts derived or from the Maintenance fees, except with
BANCOMER's previous written authorization.
I) In the event that the BORROWER, any of the FOUNDERS OF THE TRUST, ,
▇▇▇▇▇▇, MEXITUR, reduce the fixed portion of their corporate capital
stock.
J) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST
do not deliver to BANCOMER the financial statements representative of
the economic entity that constitute its Subsidiaries or Affiliates,
including the annual financial statements, which shall have the
professional opinion from an Independent Public Accountant acceptable
to BANCOMER on the date of closing its corporate year as well as the
financial statements prepared y its Administration corresponding to
natural quarters with the accumulated results for the corresponding
year.
K) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST,
▇▇▇▇▇▇, MEXITUR, or any if the respective Affiliates or Subsidiaries
abandon the Administration of their business.
L) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST,
▇▇▇▇▇▇ OR MEXITUR should default, with no justified cause in any of
their local and federal fiscal obligations, as taxpayers and as
retainers, and with respect to payments to the Mexican Institute of
Social Security (IMSS), to the Savings System for Retirement (SAR), or
any other in connection with the operation of their business, and as a
result, the corresponding authority dictates a mandate of execution
against it and is not attended on time and through proper procedures,
or if it is paid within the following 60 (SIXTY) natural days or
within the legally applicable period to do so, whichsoever may result
first.
M) In the event that any of the declarations or statements under oath
to tell the Truth in any of the Credit Documents the BORROWER or by
any of its Subsidiaies should be false or inexact.
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N) In the event that any authority should expropriate, attach, assume
custody, or take control of all or part of the BORROWER'S properties
or those of one of the FOUNDERS OF THE TRUSTS, REGINA'S or MEXITUR'S
or those of their respective Subsidiaries or Affiliates, it should
displace its present administration, or limit its faculty to operate
the business.
O) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST
▇▇▇▇▇▇, MEXITUR, or any of its respective subsidiaries should ▇▇▇▇▇ ▇
▇▇▇▇ or guarantee , or if it isjointly and severally obligated in
favor of third parties without the previous written authorization from
BANCOMER, except in amounts not greater than 100,000 Pesos.
P) In the event that the BORROWER'S or any of the FOUNDERS OF THE
TRUST, ▇▇▇▇▇▇, MEXITUR's or any of their respective subsidiaries
resolve to merge, liquidate or spin-off the corresponding company;
Q) In the event that the use of all or part of the public areas, or
those for common use in the facilities should be obstructed or
restricted, the FOUNDERS OF THE TRUST, or if the corresponding
companies should be boxed-in, assigned, segregated, encumbered, merged
or, due to any cause the use is obstructed or limited .
R) In the event that during the period of the Credit, Mr. ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is substituted as a General Director or in the
Administration of the time-share Business,. assuming that the need
arises to substitute him, the BORROWER shall provide BANCOMER the
information about the person with whom it seeks to substitute him, and
it shall obtain the previous written authorization from BANCOMER to
carry out this change, which shall not be denied without a justified
cause.
S) In the event that the amount of the Credit is not used precisely
for the purposes consigned in Clause Fifth hereunder.
T) In the event that the BORROWER or any of the FOUNDERS OF THE TRUST,
▇▇▇▇▇▇ or MEXITUR OR ANY OF the respective Subsidiaries or Affiliates
cease to provide BANCOMER the information or documentation it may
request under the terms hereunder, and such deficiency is not remedied
within a period of ten natural days, when the corresponding
information is not found subject to a period for delivery under the
terms of this contract.
U) In the event that any of the stipulations or provisions of any of
the Credit Documents should be null or unenforceable.
V) In the event that the RRI stockholders do not increase the capital
of the said RRI in at least two million dollars within the three
months following the date of execution of this instrument, or, if RRI,
individually or jointly with the BORROWER has not determined to
BANCOMER'S satisfaction the mechanism under which it shall face the
payment of the said ordinary interest derived from the Emission, and
under the said supposition, the BORROWER, the FOUNDERS OF THE TRUST,
MEXITUR or ▇▇▇▇▇▇ have not constituted a new company within the
following five Working Days which will result the isolation of any
adverse situation in the operation, reservation system, collection of
the Portfolio and Maintenance Fees, in the understanding that the
shares or the corporate parts of the corporate capital of the said new
company shall be contributed to the Trust for the Portfolio and Fees
within twenty four hours after the date in which they are issued.
W) In the event that, at least three months prior to the date in which
the interests derived from the Emmission should be covered, the
BORROWER does not demonstrate to BANCOMER that it has an adequate
mechanism to pay the said interest.
TWENTIETH.- PARTICIPATIONS
At all times, BANCOMER shall be entitled to syndicate or sub-participate
the credit totally or partially, keeping the same conditions for the
BORROWER through the simple written notification to the said BORROWER,
indicating such syndication or sub-participation, provided that costs for
the BORROWER are not increased.
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TWENTY FIRST. MODIFICATIONS
No modification of terms or conditions in this instrument, and no consent
or exemption with respect to any of the said terms and conditions shall be
effective in any case, unless it is made in writing and is subscribed by
the parties, and even then such modification, exemption or consent shall
only be effective for the specific case and purposes for which it was
granted.
TWENTY SECOND. NOTIFICATIONS
All notifications and communications anticipated or required in accordance
with this contract shall be made in writing, and shall be delivered or sent
to each party to the addresses indicated in this Clause, or to any other
address that the said party may indicate in writing to the others. These
notifications and communications shall be effective upon being delivered in
the above expressed form, and no notification shall be effective until
after it has been effectively received by the party to which it is
intended.
With respect to the above, and for all matters relative to this document
and other Credit Documents, to the Trusts in Guarantee and any other
document in relation Thereto, the parties establish the following
addresses:
THE BORROWER Boulevard ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
No. 3642 THE FOUNDERS OF
THE TRUST Floor 7
MEXITUR AND ▇▇▇▇▇▇ Colonia Jardines del Pedregal
Postal Code 01900
Mexico, Federal District
BANCOMER ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
Postal Code 03339
Mexico, Federal District
THE TRUSTEE ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
Postal Code 01900
Mexico, Federal District
TWENTY THIRD.- Authorization to receive and provide information.
BORROWER and any obligee here under hereby expressly and irrevocably
authorized BANCOMER to obtain any and all information concerning credit and
other transactions of such companies with BANCOMER or with any other bank
or company. Up on request of third parties, BANCOMER may provide credit
history information of the borrower or any obligee her under to other users
of credit bureaus, as well as any domestic or foreign rating agency.
TWENTY FOURTH.- JURISDICTION
For all matters relative to this instrument, the other Credit documents,
the Trusts in Guarantee and the documents in connection with or derived
therefore, the parties expressly submit to the jurisdiction of the
competent courts in the City of Mexico, Federal District, waiving any other
jurisdiction that might correspond to them by virtue of their present or
future domiciles, or due to any other reason.
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TWENTY FIFTH.- APPLICABLE LAW
This Contract and the other Credit Documents shall interpret the agreement
to the Laws in effect in the United Mexican States.
In Testimony of the above, the parties hereunder sign this Contract in
Mexico City, D.F. on the twenty-sixth day of November, 1999-
THE BORROWER FOUNDERS OF THE TRUST
CR Resorts Capital, S. de ▇.▇. de
C.V., CR Resorts Puerto Vallarta,
S. de ▇.▇. de C.V., CR Resorts
Cancun, S. de ▇.▇. de V.B.,
CR Resorts Los Cabos, S. de ▇.▇.
de C.V.- Desarrollos Turisticos
Integrales de Cozumel, S. deR.L.
de C.V.
-- ---- - - -- - - - - - - - - - - - - - - - - - - - - - - - -
By: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Attorney-in-Fact Attorney-in-Fact
MEXITUR ▇▇▇▇▇▇
Corporacion Mexitur, S. de ▇.▇. de C.V. Club ▇▇▇▇▇▇, S.A. de C.V.
- - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - -
By ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Attorney-in-Fact Attorney-in-Fact
BANCOMER THE TRUSTEE
Bancomer, S.A. Fianzas Monterrey Aetna, S.A.
Institucion de Banca Multiple Bancomer Financial Group
Financial Group
- - - - - - - -- - - - - - - - - - - - - - - - - - - - - - -
By: Ing. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ Thierry By: Lic. ArmandoVignau ▇▇▇▇▇▇
Director Corporate bank Fiduciary Delegate
- -- - - - -- - - - - - - - - -
By ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Viezca
Corporate Bank
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