VAT NOTE

US $40,000,000                                                New York, New York
Effective as of                                                           , 2005
                                                         -----------------

     WHEREAS,  Kansas  City  Southern,  a Delaware  corporation  ("Obligor")  as
contemplated by the Amended and Restated Acquisition Agreement among Obligor, MM
(defined  below),  and the other parties  named therein dated  December 15, 2004
(the "Acquisition  Agreement"),  promises to pay to the order of TMM Multimodal,
S.A. de C.V., a SOCIEDAD ANONIMA DE CAPITAL VARIABLE organized under the laws of
the United Mexican States ("MM"), an unsecured promissory debt obligation in the
principal amount of Forty Million U.S. Dollars (US $40,000,000) (this "Note");

     WHEREAS,  Obligor and MM each desire to evidence such debt  obligation with
the issuance of this Note upon the terms and conditions set forth herein; and

     WHEREAS,  capitalized  terms  used but not  defined  herein  shall have the
meaning assigned to them in the Acquisition Agreement.

     NOW, THEREFORE,  in consideration of the recitals (which are deemed to be a
part of this Note) and agreements  contained herein, the parties hereto agree as
follows:

     I. PROMISE TO PAY. For value received and subject to reduction  pursuant to
Section  II  below,  Obligor  hereby  promises  to pay to the order of MM in the
manner  set  forth in  Section  III  below,  on the date  that is five (5) years
following  the date hereof or upon such earlier date  following the date that is
two (2) years  following the date hereof as may be determined by KCS in its sole
discretion (the "Payment Date"), the principal sum of Forty Million U.S. Dollars
(USD $40,000,000).

     II. REDUCTION OF PRINCIPAL AMOUNT.  The principal amount of this Note shall
be subject to reduction in accordance  with the terms and  conditions of the VAT
Escrow Agreement dated as of the date hereof, by and among by and among Obligor,
Kara Sub, Inc., KCS Investment I, Ltd., KCS Acquisition Subsidiary, Inc., Caymex
Transportation,  Inc., Grupo MM, S.A., MM Holdings, S.A. de C.V., MM Multimodal,
S.A. de C.V. and the Escrow Agent named therein (the "VAT Escrow Agreement").

     III. PAYMENT,  CONVERSION INTO SHARES. On the Payment Date, this Note shall
automatically  be  converted  into the right to receive that number of shares of
KCS  Common  Stock as,  valued at the Volume  Weighted  Price,  shall  equal the
remaining principal amount of this Note as of the Payment Date.

     IV. INTEREST RATE/PAYMENT. This Note shall bear no interest.

     V.  PREPAYMENT.  Obligor  shall have the right to prepay  the  indebtedness
evidenced by this Note, in whole or in part,  without  premium or penalty,  upon
not less than thirty (30) days notice to the holder thereof.



     VI.  ASSIGNMENT.  MM's  rights  under  this Note may not be  negotiated  or
assigned.

     VII. OBLIGATIONS OF OTHERS. Obligor's obligations under this Note will also
be binding on  Obligor's  successors  and  assigns  and shall only be  assigned,
transferred or otherwise conveyed to a person or entity that consents in writing
to be so bound.

     VIII.  WAIVER;  GOVERNING LAW. Obligor hereby waives notice presentment for
payment, demand, notice of dishonor and protest of this Note, and further agrees
that this Note shall be deemed to have been made under and shall be  governed by
the laws of the State of  Delaware  without  giving  effect to the choice of law
principles of that state, in all respects,  including  matters of  construction,
validity  and  performance,  and that  none of its  terms or  provisions  may be
waived,  altered,  modified or amended  except as may be  consented to in a duly
signed writing by MM.

     VIII. CANCELLATION OF NOTE. This Note shall be automatically cancelled upon
the  delivery by Obligor of the shares of KCS Common  Stock in  accordance  with
Section 5(b) of the VAT Escrow Agreement.

     IN WITNESS WHEREOF,  Obligor has executed and delivered this Note as of the
date first above written.

                                        Kansas City Southern


                                        By:
                                           -------------------------------------
                                        Name:  Robert B. Terry
                                        Title: Senior Vice President and General
                                               Counsel